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Speaker 1: Welcome to Head of Money.

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Speaker 2: I'm Joel and I am Matt.

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

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Speaker 2: That's right, buddy. Happy Monday to everyone out there. We

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Speaker 2: hope you had a wonderful weekend. We've got list of

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Speaker 2: our questions to get to. This is again more we're

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Speaker 2: able to hear directly from listeners their specific financial quandaries

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Speaker 2: that they find themselves in. We've got a listener asking

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Speaker 2: about utilizing some rough contributions in a pinch. How to

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Speaker 2: go about doing that? Another listener is asking about the

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Speaker 2: save plan for student loans, but he's also a high earner,

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Speaker 2: so we'll discuss that. And another listener is asking about

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Speaker 2: purchasing a home in order to save money every single month.

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Speaker 2: Is that even possible? Is that something that you do?

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Speaker 2: It's something that she has heard folks talking about, so

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Speaker 2: we'll get to that one and more during this episode.

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Speaker 1: Yeah, I don't know. It feels a different math these

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Speaker 1: days in twenty twenty four than it was in twenty eleven.

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Speaker 2: Right, and maths, the math is broken, the matha math

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Speaker 2: Andjrol that's true. All right, We've got yeah, like you said,

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Speaker 2: a lot to get to on this one. But Matt,

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Speaker 2: before we get to that, I just wanted to quit

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Speaker 2: a bit. My dad sadly was My dad and mom

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Speaker 2: were driving in town the other day.

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Speaker 1: They were rear ended. They're smashed by the truck in

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Speaker 1: the in the back end of their car and so

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Speaker 1: their car like shattered glass. They are okay, they were okay.

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Speaker 1: Fortunately they were okay on the way the doctor's appointment.

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Speaker 1: My mom was able to walk to her doctor's appointment.

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Speaker 2: So what's crazy is you know how I learned about this?

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Speaker 2: My wife told me he didn't. He didn't tell me

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Speaker 2: about this.

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Speaker 1: Yeah, so okay, our friendship still matters, it does.

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Speaker 2: But that we talk about so many different things. I

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Speaker 2: think sometimes we forget. Yeah, but it's true. So they

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Speaker 2: got shared it with me though, and I was like, wait,

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Speaker 2: when did this happen? And she's like, no, that's why

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Speaker 2: he's driving a Jeep. Why is he driving a Jeep?

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Speaker 1: Because it's a rental car.

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Speaker 2: You can share that say that for some other parts.

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Speaker 1: Will Their Toyota is being repaired, right, and so they're

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Speaker 1: that thing's being fixed up. But the thing I talked

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Speaker 1: to my dad about, and the thing that I think

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Speaker 1: most people forget is that when you're in an accident

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Speaker 1: like that. Well one, I mean, there's so many things

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Speaker 1: we could talk about about, what to do in the

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Speaker 1: aftermath of an accident, how to document things, how to

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Speaker 1: make sure that you are getting taken care of and

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Speaker 1: you're getting your car fixed in the way that it

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Speaker 1: needs to be, that you deserve.

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Speaker 2: What you're supposed to say is immediately you just get

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Speaker 2: out of the vehicle and you just start saying, it's

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Speaker 2: my fault, it's my fault. Yeah, don't worry about it.

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Speaker 1: Make sure you get it on video.

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Speaker 2: So yeah, yeah, exactly, start recording me. Yeah, it's totally

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Speaker 2: my fault.

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Speaker 1: Right, it's all good. Say, oh, no need to involve

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Speaker 1: any sort of the police here, any sort of documentation.

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Speaker 1: Yeah you don't want you know what. Just kidding obviously,

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Speaker 1: But yeah, there's a lot we can say on that.

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Speaker 1: But the one thing I feel like that almost nobody

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Speaker 1: knows about, or a lot of people have forgotten about.

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Speaker 1: And the thing I had to remind my data is

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Speaker 1: that something known as diminished value and the fact that

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Speaker 1: when your car is in an accident, the nicer, the

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Speaker 1: newer your car is, the more money you're gonna be

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Speaker 1: able to get from the offending insured person from that

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Speaker 1: insurance company, because not only are is the insurance company

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Speaker 1: responsible for fixing your car up and bringing you back

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Speaker 1: to the state that it was, but because of the

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Speaker 1: fact that car has now been in an accident, it

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Speaker 1: is worthless by that, just by that one metric.

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Speaker 2: By the fact that it has been involved in IRAQ.

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Speaker 1: That's right. So I was like looking up to figure

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Speaker 1: out for my dad, Okay, how much are you owed

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Speaker 1: from the insurance company, and there's like a there's a

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Speaker 1: calculator you can find online, there's things you can do

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Speaker 1: to kind of try to figure out. There's not a

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Speaker 1: lot out there, but there's there's a little bit at least,

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Speaker 1: And it was like, Okay, you probably deserve somewhere in

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Speaker 1: the eighteen hundred to twenty four hundred dollars range. Push

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Speaker 1: for something in this and if they try to say, oh,

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Speaker 1: we'll give you five hundred bucks, well that's clearly a

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Speaker 1: low ball value based on the calculations you can run.

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Speaker 1: And so it's just one of those things most people

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Speaker 1: don't think about that if you've been in a car

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Speaker 1: accident that wasn't your fault, that is a term you

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Speaker 1: need to know, you need to bring up with the

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Speaker 1: insurance company, with the agent who you're working with, so

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Speaker 1: that you can get paid for the fact that your

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Speaker 1: car is now worth less than it was before it's

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Speaker 1: I think Nebraska is the only state that maybe doesn't

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Speaker 1: have the minish value. In the other forty nine states,

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Speaker 1: you can ask for that and you are entitled to it.

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Speaker 2: Yeah, that's one good reason to not live in Nebraska.

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Speaker 2: This is I'm kidding, one of the other good reasons. Kidding.

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Speaker 2: By the way, no hate all the Nebraska's out there

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Speaker 2: where they driving the Toyota.

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Speaker 1: They were what, what's the other call? They both have toyos. Yeah, well,

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Speaker 1: yeah with a Highlander and a Prius.

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Speaker 3: Oh I thought they used to have they used to

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Speaker 3: have a rat for yes, right, a toy I don't

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Speaker 3: think I knew that they Hey there's other Toyota's our

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Speaker 3: words that when it comes to the hybrid drive train,

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Speaker 3: I mean you're looking at gas mileage, you're looking at dependability.

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Speaker 2: I kind of kicked myself that I don't have a

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Speaker 2: ci Na. Yeah, I've been on the ads. We've both

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Speaker 2: been on the Odyssey bandwagon now for quite a while.

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Speaker 2: But the ability to have yeah, hybrid man, I'm trying

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Speaker 2: to find a way to reduce our fuel costs. Yea,

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Speaker 2: even though we still only have one vehicle.

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Speaker 1: Keep trying to tell you go for the EV dog,

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Speaker 1: but or a plug.

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Speaker 2: In EV well. As prices continue to drop, Yes, that

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Speaker 2: will be something I consider, because folks are there. I

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Speaker 2: think a lot of folks are getting kind of scared

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Speaker 2: off by the idea of like, oh no, like you know,

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Speaker 2: the EV's aren't all what they're cracked up to be.

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Speaker 2: Because of that, prices are dropping, and I think there

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Speaker 2: could definitely be an opportunity there to snag some deals.

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Speaker 2: I mean there already have been massive deals, specifically with Tesla,

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Speaker 2: but then in the coming years more.

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Speaker 4: Yeah.

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Speaker 2: And have we talked about in China? How at their

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Speaker 2: like latest auto show or this is a few weeks ago,

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Speaker 2: I guess at this point, but they unveiled specifically is

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Speaker 2: it bid? Is the Chinese evary.

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Speaker 1: Are kicking butt making great rides.

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Speaker 2: Twelve to thirteen hundred miles on a single charge from an.

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Speaker 1: EV But we're not going to see those here in

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Speaker 1: the States anytime soon.

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Speaker 5: I know.

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Speaker 2: But it's so messed up. Yeah, it just tells me

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Speaker 2: there's more to do with I don't know, it seems

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Speaker 2: like there's more politics involved as opposed to like doing

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Speaker 2: what's green and what's best for the earth and ultimately

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Speaker 2: what's going to make consumers the happiest of right, Oh

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Speaker 2: my gosh about you. Imagine if you had a twelve

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Speaker 2: hundred mile.

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Speaker 1: Charge ev adoption would soar in this country if we

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Speaker 1: had inexpensive, longer range EV's. But it doesn't seem like

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Speaker 1: any politician right now wants to fight for that.

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Speaker 2: So yeah, what is it mile anxiety or rangings? Yeah,

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Speaker 2: that would completely disappe you go completely, Yeah, and we're

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Speaker 2: headed in that. Actually I have more than a thousand

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Speaker 2: miles in one day.

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Speaker 1: Right, we're headed in that direction anyway. But sadly, we

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Speaker 1: could be there sooner and we can have those options

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Speaker 1: at our disposal. And I get some of the reasons

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Speaker 1: for productionism, but you also can't have it both ways.

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Speaker 1: You can't say that this is the future and we

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Speaker 1: have to all go in this direction and then say,

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Speaker 1: but we won't take the most low cost brand. We're

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Speaker 1: going to essentially prevent them, bar them from entering the market.

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Speaker 1: It's pretty messed up, yeap.

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Speaker 2: Maybe what we need to do is like ramp up

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Speaker 2: our espionage, like maybe maybe we need to steal more.

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Speaker 1: Point more trade secrets Matt. Matt doubles as an FBI informant,

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Speaker 1: So yeah, that's a side hustle.

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Speaker 2: A little, the ways she makes some extra money.

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Speaker 1: That's right, alright, midlistisch And the beer we're having on

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Speaker 1: this episode, it's called Duchess Red. It's a sour cherry

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Speaker 1: beer that we've had before, but never on this never

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Speaker 1: on the podcast. So yeah, one of your wife's favorite beers.

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Speaker 1: In fact, one of my favorite beers.

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Speaker 2: I love it as well.

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Speaker 1: All right, we'll give our thoughts at the end of

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Speaker 1: the episode, but Matt loves it, all right. So let's

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Speaker 1: get to listener questions. If you have a question, a

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Speaker 1: money question, go to how to money dot com slash ask.

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Speaker 1: Or if you just want to know that's deepest darket secrets,

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Speaker 1: you can record that question too and send it our

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Speaker 1: way they tell you, but you got to record it

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Speaker 1: and send it over that's the only way you get

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Speaker 1: the information. Just go to how to money dot com

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Speaker 1: slash ask for the simple instructions, but basically record a

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Speaker 1: voice memo sending it to us via email. Now let's

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Speaker 1: get to the first question for this episode. This one

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Speaker 1: is about student loan payoff.

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Speaker 6: Hello, Matthew and Joel Sith. This is Shakatron from Benuda, California.

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Speaker 6: I'm calling in with a question about student loans. My

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Speaker 6: question is, at what point or what are the drawbacks

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Speaker 6: of the new SAVE program. I guess it's not super

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Speaker 6: new anymore, especially for high income earners. I am fortunate

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Speaker 6: enough to make three hundred thousand dollars a year, but unfortunately,

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Speaker 6: to get to that point, I had to take out

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Speaker 6: a lot of student loans, and I have roughly one

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Speaker 6: hundred and fifty thousand dollars in student loans right now

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Speaker 6: that I'm chipping away at. I have a six percent

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Speaker 6: interest on those graduate student loans. I currently am in

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Speaker 6: the pay program that PAYE program. Everyone in their mom

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Speaker 6: says that the new Save program online and that I

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Speaker 6: talk to is the best thing since sliced bread. But

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Speaker 6: when I read into the fine print, it seems like

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Speaker 6: there's no cap on the amount of payments that you'd

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Speaker 6: have every month versus my current plan, and so I

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Speaker 6: get a little bit confused with all of these different options.

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Speaker 6: Is it just a gimmick? And so I think in

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Speaker 6: my situation it might not be beneficial. And I think

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Speaker 6: I'm trying to push out my student loans as much

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Speaker 6: as possible and try and get some help from Uncle

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Speaker 6: Sam with different government programs for student loan forgiveness. But

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Speaker 6: any thoughts you guys have would be much appreciated. And

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Speaker 6: thank you for your show. It is very interesting and

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Speaker 6: has kept me on the right path financially, So thank.

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Speaker 2: You for that.

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Speaker 1: Oh, Matt, you hear that you have been like the

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Speaker 1: bumpers in the bowling lane for I was going to

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Speaker 1: do which.

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Speaker 2: By the way, that's it's worth mentioning. Maybe Shakatron I'm guessing,

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Speaker 2: isn't his birth name given to him name? He's not

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Speaker 2: an evil robot. No, you kind of gravitated towards it

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Speaker 2: that my real name is joelseph it is. Yeah, I

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Speaker 2: wanted to jump on the exact same thing that you did,

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Speaker 2: which is the fact that he's I think what he

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Speaker 2: said was that he is on the right financial path, which, dude,

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Speaker 2: that is one hundred percent what it's about right there. Like,

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Speaker 2: you might be listening to the podcast and you might

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Speaker 2: not have much in common with Joel or I you

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Speaker 2: might workron, but the fact is, like, what we're trying

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Speaker 2: to do here with the show is just normalize these

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Speaker 2: conversations around personal finances and money and delaying that immediate

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Speaker 2: gratification and instead planning for your future. And the more

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Speaker 2: that we're able to present that as normal and the

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Speaker 2: more widely accepted. And it's not ever, I don't think

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Speaker 2: going to be widely accepted as this is the path forward,

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Speaker 2: not in this country. Not no, because we're constantly being

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Speaker 2: fed but oh no, it's owed to you, like you

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Speaker 2: need to live your life now, you don't need to

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Speaker 2: plan for the future. But the fact that Shakatron is

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Speaker 2: thinking about his future, I love that, and I mean

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Speaker 2: honestly like that is like hearing that part of his

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Speaker 2: comment there may be the happiest the fact that he's

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Speaker 2: just proactively thinking about it.

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Speaker 1: It's going to take some willingness to be countercultural. And

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Speaker 1: it's also important to mention that that it doesn't happen overnight.

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Speaker 1: Progress is slow and steady, but like man turning that

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Speaker 1: rudder just a little bit, think about how quickly that's

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Speaker 1: going to pivot you in a new direction over the

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Speaker 1: coming weeks and months. That is the goal of the show.

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Speaker 1: Get you on the right financial path. Some of that, too,

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Speaker 1: is overarching advice, and some of it gets really specific too,

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Speaker 1: rit like talking about diminished value or now talking about

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Speaker 1: something like specific student on payment programs. Those are all

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Speaker 1: worth discussing, and they're all kind of part of what

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Speaker 1: it looks like to have a healthy financial life. And

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Speaker 1: so let's specifically get to Chakatron's question here. Matt he

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Speaker 1: by the way, he's got a big salary, which is huge.

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Speaker 1: I mean, that's gonna help you pivot and continue along

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Speaker 1: that healthy financial path much better than if your salary was, like,

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Speaker 1: got quite a bit lower. But a high salary, of

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Speaker 1: course doesn't mean that why choices aren't still necessary, right,

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Speaker 1: I think some people that's the problem. As you tick

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Speaker 1: up the income scale, you still see a lot of

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Speaker 1: people in those upper echelons living paycheck to paycheck. You

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Speaker 1: can make more progress, but you can also continue the

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Speaker 1: same bad habits that led you to poor financial decisions

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Speaker 1: when you were making half as much. Sure, and so yeah,

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Speaker 1: but we want Chocatron to pick the right payback plan

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Speaker 1: that gives him of the most bang for his buck,

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Speaker 1: because every dollar he doesn't have to put towards his

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Speaker 1: student loans is a dollar that he can say that

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Speaker 1: he can invest or that he can just spend in

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Speaker 1: other ways that are more fulfilling, that are more joyful.

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Speaker 1: And by the way, I think that that one hundred

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Speaker 1: and fifty thousand dollars of student loan debt, I don't

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Speaker 1: see it as an anvil weighing him down, but I

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Speaker 1: see it actually the reason he's able to command such

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Speaker 1: an income right that it's catapulted him into a higher

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Speaker 1: earning stratusphere. I know, of course, it's not fun to

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Speaker 1: owe that much, to have this a debt amount that's

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Speaker 1: this high, But that mindset shift, I think is an

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Speaker 1: important one to say, Hey, listen, this was the thing

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Speaker 1: that got me here. This isn't necessarily the thing holding

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Speaker 1: me back. It's propelling me. Although now I got to

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Speaker 1: figure out a way it's kind of eradicated so I

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Speaker 1: can run even faster.

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Speaker 2: Yeah. I guess what we don't know is how long

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Speaker 2: he's been working since he graduated, because if you let's

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Speaker 2: just say he just graduated, Hey, this seems like a

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Speaker 2: perfectly a perfectly reasonable student loan amount. Rule of thumb

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Speaker 2: being to not borrow more than what you earn in

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Speaker 2: your first year after you graduate. But maybe it's been

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Speaker 2: like five years. I don't know, but either way, I

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Speaker 2: think there is he's he's climbed the ladder and he's

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Speaker 2: doing it.

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Speaker 6: Yeah.

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Speaker 2: I think there's a lot of progress that you can

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Speaker 2: make with an income that high. But you're asking about

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Speaker 2: a topic with some real nuance here, and for most

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Speaker 2: folks who aren't in your upper echelon earning stratosphere, Shakat,

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Speaker 2: I think we're gonna both try to save this day

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Speaker 2: as often as possible because it's so awesome. But for

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Speaker 2: other folks out there, usnormis the Safe Plan, it really

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Speaker 2: will be a massive help for them, which is why

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Speaker 2: you hear all those great headlines, you hear all that

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Speaker 2: that feverish support from almost everywhere.

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Speaker 1: He specifically asked for it was a gimmick, and the

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Speaker 1: answer is it's not a gum not for a lot.

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Speaker 2: Of people exactly. Yeah, the average student loan netter is

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Speaker 2: going to be able to see their payment reduced significantly

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Speaker 2: because of the Safe Plan. That's ton of folks are

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Speaker 2: gonna pay zero dollars a month thanks to the like

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Speaker 2: specifically the more generous poverty line deduction. But for you shaka.

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Speaker 2: The safe plan is almost assuredly going to be a

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Speaker 2: bad idea.

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Speaker 1: Yeah, And it's no wonder that you're confused because the

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Speaker 1: details can be hard to figure out.

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Speaker 2: Yeah, exactly, it's it's it's worth noting too. That is

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Speaker 2: he said he's an engineer. I means he's pretty smart. Right,

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Speaker 2: he's commanding a pretty high salary. Yes, it's still really confusing, still.

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Speaker 1: Confusing, and they're I think part of it's because there's

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Speaker 1: these four letter acronyms. You're like, save, pay, repay, and

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Speaker 1: you're like, I don't know, it's hard to parse the details,

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Speaker 1: and you maybe read the it feels like reading a

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Speaker 1: foreign language, almost, as you're perusing the specifics of each one,

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Speaker 1: and you're like, so, how do I know which one

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Speaker 1: of these is going to be best for me? Then?

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Speaker 1: And we The save plan is an income driven repayment plan, right,

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Speaker 1: which means the higher income, the more you pay each month.

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Speaker 1: So if you make sixty thousand dollars, as you were

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Speaker 1: alluding to, let's say you made sixty thousand dollars and

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Speaker 1: you have four kids, your payment might go from hundreds

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Speaker 1: of dollars a month to zero dollars a Yeah, and

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Speaker 1: there's going to be a lot of people, depending on

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Speaker 1: their income and how their family size, they might find

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Speaker 1: themselves in that position. But if you are in Shaka

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Speaker 1: territory and you're making hundreds of thousand dollars of dollars

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Speaker 1: a year and you don't have like a dozen children

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Speaker 1: to like qualify as a larger family size, which I

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Speaker 1: didn't hear Shaka mention anything about having kids. If he's

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Speaker 1: single and has an income that high, the Save plan

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Speaker 1: is actually going to be more harmful than helpful. Right,

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Speaker 1: So sticking with the pay plan that you're currently on

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Speaker 1: is almost inevitably going to be the best financial decision

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Speaker 1: to spite. Despite the laudatory things that you've heard about

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Speaker 1: the Save plan, it just doesn't fit for your situation

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Speaker 1: for year.

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Speaker 2: You not a good plan for it. Yeah. The crux

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Speaker 2: of the matter is that payment cap that you mentioned,

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Speaker 2: Because if you sign up for Save and your income

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Speaker 2: continues to increase, well, that payment can go up too.

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Speaker 2: And here's the thing, the sky is the limit to

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Speaker 2: how high it can go. Yeah, there is no cap

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Speaker 2: that is not true for your pay plan. So you

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Speaker 2: don't want to base your decision solely on what you're

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Speaker 2: earning now, but you also want to think about what

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Speaker 2: it is that you might be earning in the near future.

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Speaker 1: The other thing I think worth mentioning is that the

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Speaker 1: pay plan comes with a shorter timeline for forgiveness for

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Speaker 1: graduate student loans, which is, I believe what Chaka said

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Speaker 1: he had right, So twenty years versus twenty five years

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Speaker 1: with a save plan, and that might seem like forever

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Speaker 1: a way anyway, but with the size of your balance,

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Speaker 1: you just might find that to be another compelling reason

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Speaker 1: to choose pay oversave. Also, I wouldn't let that be

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Speaker 1: a deciding factor because ultimately, especially given your income, we'd

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Speaker 1: love to see you pay off that balance before you

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Speaker 1: reach that endpoint. Anyway, Forgiveness is cool, but given yeah,

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Speaker 1: how much money you're able to bring in the size

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Speaker 1: of that balance, I think you should be able to

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Speaker 1: get rid of those loans in years rather than decades.

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Speaker 1: But that is at least one more fact or one

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Speaker 1: more checkbox, and like maybe much just stick with pay

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Speaker 1: because if it does take me longer, I'm that much

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Speaker 1: closer to having at least part of my student loan

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Speaker 1: debt forgiven.

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Speaker 2: Yeah. For him, like we have to sort of interpret

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Speaker 2: the question for the listener out there, because they're hearing

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Speaker 2: one hundred and fifty K and they're thinking, oh my gosh,

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Speaker 2: that's a substantial amount of money. But for those folks,

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Speaker 2: it might only be earning you know, like sixty or

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Speaker 2: seventy K, where yes, you do probably want to extend

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Speaker 2: the payments as long as possible and not for that forgiveness.

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Speaker 1: In that case, it feels like a grizzly bear sitting

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Speaker 1: on your chest, whereas yeah, in the case of Shaka,

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Speaker 1: it's like a baby cub, Yeah, trying to grab onto

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Speaker 1: your back.

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Speaker 2: It's like swatten away a fly.

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Speaker 1: Yeah, all those costs hurt even though you're a baby.

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Speaker 1: It's yeah, it's still uncomfortable.

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Speaker 2: But there's But I think what you're saying is true

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Speaker 2: because like so Shaka he was like chipping away at

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Speaker 2: his student loans, and I think that's okay. It's a

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Speaker 2: big balance. You know, it can be hard to maybe

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Speaker 2: like mentally wrap your mind around that. We get it.

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Speaker 2: You don't I want to put other financial goals on

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Speaker 2: the back burner at the same time, right, Like, for instance,

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Speaker 2: you don't want to avoid investing in order to pay

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Speaker 2: it off immediately. In order to pay it off more quickly.

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Speaker 1: I think a lot of years that you might be

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Speaker 1: avoiding your roth irka if you made that choice.

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Speaker 2: I just think it's a good idea to try to

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Speaker 2: be doing both at the same time, eliminating that debt

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Speaker 2: but also building up a nest egg for your future.

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Speaker 2: And then plus those contributions will actually reduce your AGI,

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Speaker 2: which reduces your required monthly payment. But the longer you

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Speaker 2: can live a lean existence, the more quickly you're going

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Speaker 2: to be able to eradicate that debt. And again, we

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Speaker 2: know this is a massive sum, but your income, it's

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Speaker 2: pretty large, and it might not be worth drawing out

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Speaker 2: those payments for multiple decades, for instance, to have just

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Speaker 2: perhaps small amount forgiven by the time you reach that,

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Speaker 2: you know, twenty years down the road, I think you

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Speaker 2: might just be better off funneling money toward the debt

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Speaker 2: to get rid of it sooner rather than later. And

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Speaker 2: there's different calculators you can check out, like the student

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Speaker 2: Loans the student Loans simulator that is up at studentaid

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Speaker 2: dot gov. I've heard folks talk about that, but simultaneously

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Speaker 2: it seems like it has limited information that it will consider. So,

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Speaker 2: for instance, how long you've been paying on that, and

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Speaker 2: so given the fact that you've got more, there's the

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Speaker 2: stakes are higher here. Given the large amount of student

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Speaker 2: loans that you have, it might be worth checking in

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Speaker 2: with student loan planner. We actually have a review up

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Speaker 2: on the website that will link to you in the

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Speaker 2: show notes for this episode. But that might be a

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Speaker 2: great resource for you, just to have somebody essentially kind

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Speaker 2: of guiding you, walking you.

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Speaker 1: Through this, like a financial planner for your student loans,

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Speaker 1: like yeah, and as someone who's an experts specifically at

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Speaker 1: choosing the right payment plan and knowing the right pathwork.

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Speaker 2: Yeah, and especially given the fact that the rules have changed,

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Speaker 2: and we often talk about this. It used to be

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Speaker 2: where the only time we would say, hey, you should

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Speaker 2: probably consider hiring a professional is with a tax professional

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Speaker 2: because the fact that the rules change so frequently, and

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Speaker 2: some small mistakes on the friend and could cost you

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Speaker 2: a large amount of money. But that's it's a similar

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Speaker 2: pattern now that we're seeing when it comes to student

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Speaker 2: loan repayments, as the rules of change and as there

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Speaker 2: are different requirements. Yeah, so that might be worth your time.

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Speaker 1: Yeah, we'll link to that review in the show notes

434
00:19:05,040 --> 00:19:07,719
Speaker 1: in case, you do want to say, listen, I've got

435
00:19:07,720 --> 00:19:09,080
Speaker 1: a lot of money here that I need to pay off,

436
00:19:09,080 --> 00:19:11,080
Speaker 1: and making the wrong choice could cost me a lot

437
00:19:11,080 --> 00:19:13,359
Speaker 1: more than hiring the professional to help me choose the

438
00:19:13,400 --> 00:19:15,479
Speaker 1: slam dunk best thing for me. You're in the kind

439
00:19:15,520 --> 00:19:17,800
Speaker 1: of position chockout where that can make a lot of sense.

440
00:19:18,119 --> 00:19:20,639
Speaker 1: But best of luck as you pay off those loans,

441
00:19:20,680 --> 00:19:22,920
Speaker 1: we hope you're not holding on to them for too long. Matt.

442
00:19:22,920 --> 00:19:24,760
Speaker 1: We've got more to get through on this episode, including

443
00:19:24,960 --> 00:19:28,040
Speaker 1: we'll talk about cashing out a retirement account to pay

444
00:19:28,080 --> 00:19:30,200
Speaker 1: off a nefarious debt. We'll talk about that and more

445
00:19:30,359 --> 00:19:30,919
Speaker 1: right after this.

446
00:19:39,000 --> 00:19:41,280
Speaker 2: Right man, we are back from the break, and like

447
00:19:41,359 --> 00:19:45,760
Speaker 2: you mentioned, we will talk about tapping some ROTH contributions.

448
00:19:46,000 --> 00:19:48,800
Speaker 2: But let's now hear from a listener who's looking to

449
00:19:48,840 --> 00:19:51,280
Speaker 2: take a more active role when it comes to his

450
00:19:51,480 --> 00:19:52,560
Speaker 2: retirement portfolio.

451
00:19:53,160 --> 00:19:57,359
Speaker 5: Hi, Matt and Joel, this is Addie. I am a

452
00:19:57,400 --> 00:20:01,200
Speaker 5: thirty nine year old engineer living in in Southeast Michigan.

453
00:20:02,000 --> 00:20:06,720
Speaker 5: I have recently hired a financial advising firm to manage

454
00:20:06,760 --> 00:20:11,439
Speaker 5: my funds and finances. After working with them for four months,

455
00:20:12,119 --> 00:20:16,280
Speaker 5: I believe I have time and skills needed for planning

456
00:20:16,320 --> 00:20:22,560
Speaker 5: the finances by myself. However, regarding managing my investment, there

457
00:20:22,600 --> 00:20:25,760
Speaker 5: are two things that I am unable to do by myself.

458
00:20:26,320 --> 00:20:32,200
Speaker 5: They are one tax loss harvesting and two sector investing.

459
00:20:33,000 --> 00:20:37,880
Speaker 5: My question to you both is, are tax loss harvesting

460
00:20:38,200 --> 00:20:45,520
Speaker 5: and sector investing as effective as these financial advising firms

461
00:20:45,640 --> 00:20:50,200
Speaker 5: claimed to be. Hoping to hear your answers sometime soon.

462
00:20:51,080 --> 00:20:55,399
Speaker 5: Thank you, and I appreciate what you both are doing

463
00:20:55,480 --> 00:21:00,240
Speaker 5: in terms of educating people like me. Thank you, Matt.

464
00:21:00,280 --> 00:21:02,560
Speaker 1: This is a perfect timing for this question, considering we

465
00:21:02,560 --> 00:21:05,600
Speaker 1: were just talking about when to hire a financial pro

466
00:21:05,800 --> 00:21:07,800
Speaker 1: or not, and I feel like there's probably more weeds

467
00:21:07,800 --> 00:21:10,680
Speaker 1: we can dive into in answer to ADDIE's question here,

468
00:21:10,960 --> 00:21:13,560
Speaker 1: so Ati, thank you for your question, and I love

469
00:21:13,560 --> 00:21:16,360
Speaker 1: that you're ready to manage your own investments. I will

470
00:21:16,359 --> 00:21:19,800
Speaker 1: say we have like mixed feelings on financial advisors and

471
00:21:19,880 --> 00:21:22,560
Speaker 1: when it makes sense for people to bring one on

472
00:21:22,720 --> 00:21:25,960
Speaker 1: into their financial lives, they make very little sense for

473
00:21:26,000 --> 00:21:28,080
Speaker 1: people in the beginning of their wealth building endeavor.

474
00:21:28,160 --> 00:21:28,240
Speaker 2: Right.

475
00:21:28,240 --> 00:21:29,840
Speaker 1: I think we took a question not too long ago, Matt,

476
00:21:29,880 --> 00:21:32,600
Speaker 1: from someone in his early twenties didn't have much save

477
00:21:32,680 --> 00:21:36,120
Speaker 1: doesn't have much invested yet, and he's trying to figure out,

478
00:21:36,160 --> 00:21:37,880
Speaker 1: you know, what it looks like to have a relationship

479
00:21:37,880 --> 00:21:40,920
Speaker 1: with a financial advisor. We're saying it's too soon, you're

480
00:21:40,960 --> 00:21:43,640
Speaker 1: not ready. You need to keep funneling money towards your

481
00:21:43,640 --> 00:21:46,160
Speaker 1: future and less towards a pro to help you out. Right.

482
00:21:46,359 --> 00:21:48,920
Speaker 1: But the further along you get, or the more complex

483
00:21:49,000 --> 00:21:51,479
Speaker 1: your finances get, the more you might want to employ

484
00:21:51,520 --> 00:21:52,600
Speaker 1: employ the help of a pro.

485
00:21:52,720 --> 00:21:52,920
Speaker 4: Right.

486
00:21:53,560 --> 00:21:55,359
Speaker 1: But if you're going to do that, it's crucial to

487
00:21:55,359 --> 00:21:58,000
Speaker 1: do it wisely because you want to make sure you

488
00:21:58,119 --> 00:22:01,439
Speaker 1: hire a fee only fiduciary. And you know, we prefer

489
00:22:01,600 --> 00:22:03,800
Speaker 1: that you do business with an advisor who charges a

490
00:22:03,800 --> 00:22:07,399
Speaker 1: flat hourly or a one time fee, because the ongoing costs,

491
00:22:07,400 --> 00:22:10,800
Speaker 1: the one percent ongoing fees could really eat intose compounding returns.

492
00:22:10,800 --> 00:22:13,119
Speaker 1: It seems on the very front end, it seems like

493
00:22:13,160 --> 00:22:16,720
Speaker 1: one percent. That sounds reasonable, and I'm gonna paying a

494
00:22:16,760 --> 00:22:19,399
Speaker 1: little bit dribs and drabs every single year. But man,

495
00:22:19,640 --> 00:22:21,840
Speaker 1: I don't want to have to pay like three thousand

496
00:22:21,920 --> 00:22:23,399
Speaker 1: dollars to have someone help me come up with a

497
00:22:23,440 --> 00:22:26,560
Speaker 1: financial plan. That's so much money. But when you do

498
00:22:26,720 --> 00:22:29,000
Speaker 1: the math, the way that one percent fee eats into

499
00:22:29,040 --> 00:22:31,240
Speaker 1: your returns. You'd be much better off paying three thousand

500
00:22:31,240 --> 00:22:34,280
Speaker 1: dollars one time for a financial plan for a long,

501
00:22:34,720 --> 00:22:38,840
Speaker 1: multi visit session with a financial planner. Our brains, it's

502
00:22:38,880 --> 00:22:40,800
Speaker 1: just hard for our brains to think that that's the case,

503
00:22:40,840 --> 00:22:43,359
Speaker 1: that that one time expensive fee would be smarter. But

504
00:22:43,440 --> 00:22:45,080
Speaker 1: for most people it's much smarter.

505
00:22:45,359 --> 00:22:47,040
Speaker 2: Yeah, especially for a lot of listeners who might be

506
00:22:47,200 --> 00:22:50,680
Speaker 2: entering into some of those higher earning years of their careers.

507
00:22:51,160 --> 00:22:54,040
Speaker 2: And what I also love about what Addie is saying

508
00:22:54,280 --> 00:22:56,919
Speaker 2: is that he feels like having an advisor for just

509
00:22:56,920 --> 00:22:59,000
Speaker 2: a period of time, that it has given him the

510
00:22:59,040 --> 00:23:02,280
Speaker 2: tools to go alone, because like, it's just awesome that

511
00:23:02,320 --> 00:23:04,240
Speaker 2: he's been able to learn, Because I think going through

512
00:23:04,280 --> 00:23:07,360
Speaker 2: the planning experience, it can provide a ton of helpful insights.

513
00:23:07,440 --> 00:23:10,440
Speaker 2: Right The information that they make you gather and confront,

514
00:23:10,480 --> 00:23:13,240
Speaker 2: the goals that they help you to outline, the questions

515
00:23:13,240 --> 00:23:15,600
Speaker 2: that they can ask are illuminating, and I think all

516
00:23:15,640 --> 00:23:18,240
Speaker 2: of those things combined can make the task of creating

517
00:23:18,240 --> 00:23:20,919
Speaker 2: a financial plan a little less daunting. Certainly you can

518
00:23:20,960 --> 00:23:23,960
Speaker 2: do that all on your own, sure, but an advisor

519
00:23:24,040 --> 00:23:26,080
Speaker 2: can just prod you in different ways that maybe you

520
00:23:26,160 --> 00:23:28,560
Speaker 2: otherwise wouldn't. It makes me think of like hiring a

521
00:23:28,600 --> 00:23:30,840
Speaker 2: personal trainer for a period of time where you're like, oh, wow,

522
00:23:31,280 --> 00:23:33,240
Speaker 2: I didn't realize I was capable of that, or oh wow,

523
00:23:33,280 --> 00:23:35,240
Speaker 2: I did not think to try to do this instead

524
00:23:35,280 --> 00:23:37,320
Speaker 2: of that because maybe you were stuck in your ways.

525
00:23:37,200 --> 00:23:38,400
Speaker 1: Or say, oh, can you read a couple of self

526
00:23:38,400 --> 00:23:40,679
Speaker 1: help books and work through your own mental health issues? Sure,

527
00:23:40,760 --> 00:23:45,080
Speaker 1: but like it's the help of a licensed therapist who's

528
00:23:45,080 --> 00:23:47,280
Speaker 1: gone through years of training can get to help you

529
00:23:47,320 --> 00:23:48,800
Speaker 1: get to the root of some things and help you

530
00:23:48,800 --> 00:23:50,719
Speaker 1: think about things in a way you never had before.

531
00:23:50,800 --> 00:23:52,639
Speaker 1: And then maybe down the line, off you've done some therapy,

532
00:23:52,680 --> 00:23:55,240
Speaker 1: like you can abandon it or at least like do

533
00:23:55,240 --> 00:23:55,720
Speaker 1: it less often.

534
00:23:55,760 --> 00:23:57,800
Speaker 2: Professionals are going to have a deeper level of knowledge

535
00:23:57,840 --> 00:23:59,879
Speaker 2: on many fronts, which means you know, they're just going

536
00:23:59,880 --> 00:24:01,720
Speaker 2: to bring things to the service that you may not

537
00:24:01,760 --> 00:24:02,240
Speaker 2: have thought about.

538
00:24:02,320 --> 00:24:04,240
Speaker 1: That's right. So I do think that is one of

539
00:24:04,280 --> 00:24:07,000
Speaker 1: the plus checks in the plus column for hiring an advisor.

540
00:24:07,240 --> 00:24:10,600
Speaker 1: But let's get to those two specific questions that you ask.

541
00:24:10,680 --> 00:24:13,960
Speaker 1: Yes about tax loss harvesting, so we'll start there. Tax

542
00:24:14,000 --> 00:24:16,479
Speaker 1: loss harvesting is great. It can be a way to

543
00:24:16,760 --> 00:24:20,360
Speaker 1: reduce taxes without really changing the makeup of your portfolio

544
00:24:20,480 --> 00:24:23,840
Speaker 1: very much. But it's not helpful when we're talking about

545
00:24:24,000 --> 00:24:26,880
Speaker 1: tax advantaged accounts. When you buy and sell inside of those,

546
00:24:26,880 --> 00:24:28,600
Speaker 1: there is no taxable events, so you don't need tax

547
00:24:28,600 --> 00:24:31,440
Speaker 1: loss harvesting. The only way that it makes sense or

548
00:24:31,480 --> 00:24:34,120
Speaker 1: that it can be helpful is if you've got funds,

549
00:24:34,240 --> 00:24:37,280
Speaker 1: significant funds, and a taxable brokerage account. So if that's

550
00:24:37,359 --> 00:24:41,320
Speaker 1: the case, there are opportunities basically every single year to

551
00:24:41,880 --> 00:24:45,440
Speaker 1: reduce your tax burds. Burden buy tax loss harvesting, which

552
00:24:45,880 --> 00:24:47,760
Speaker 1: means selling a fund at a loss and buying a

553
00:24:47,840 --> 00:24:51,160
Speaker 1: very similar fund afterward, which save yourself money at tax time.

554
00:24:51,200 --> 00:24:53,560
Speaker 1: But like I said, it doesn't really affect your portfolio

555
00:24:53,560 --> 00:24:56,920
Speaker 1: in any meaningful way. By harvesting a loss, you're able

556
00:24:56,960 --> 00:25:01,680
Speaker 1: to offset taxes on both gains and in And so, yeah,

557
00:25:01,720 --> 00:25:04,840
Speaker 1: do you need your financial planner, your fancy paints financial

558
00:25:04,840 --> 00:25:06,600
Speaker 1: planner to help you do this? Is it worth the

559
00:25:06,640 --> 00:25:08,439
Speaker 1: fee or the percentage you're giving to them for this?

560
00:25:08,840 --> 00:25:12,280
Speaker 1: I would say probably not. Robo advisors like Betterment can

561
00:25:12,280 --> 00:25:14,720
Speaker 1: help you do it for far less than that, And

562
00:25:15,200 --> 00:25:17,720
Speaker 1: they say on Betterment site that four and five users

563
00:25:18,000 --> 00:25:20,520
Speaker 1: cover their Betterment fee with the savings from tax loss

564
00:25:20,520 --> 00:25:23,000
Speaker 1: harvesting alone. So I think if you do have a

565
00:25:23,040 --> 00:25:27,040
Speaker 1: substantial taxable broker's account and you like tax loss harvesting,

566
00:25:27,080 --> 00:25:30,240
Speaker 1: you like saving potentially a few thousand dollars being able

567
00:25:30,280 --> 00:25:32,639
Speaker 1: to make that claim on your taxes. If that's one

568
00:25:32,680 --> 00:25:34,399
Speaker 1: of the main selling points of your advisor, there are

569
00:25:34,480 --> 00:25:35,600
Speaker 1: cheaper ways to get that done.

570
00:25:35,640 --> 00:25:37,680
Speaker 2: Sure, And I will say, of course Betterment has a

571
00:25:37,760 --> 00:25:40,880
Speaker 2: vested interest in saying on their site that hey, eighty

572
00:25:40,920 --> 00:25:44,920
Speaker 2: percent of folks other fee covered, So you know, take

573
00:25:44,920 --> 00:25:46,840
Speaker 2: that with a grain of salt. But the fact is,

574
00:25:46,880 --> 00:25:49,520
Speaker 2: tax loss harvesting is a legitimate thing, and this is

575
00:25:49,560 --> 00:25:53,240
Speaker 2: a more affordable way to achieve that rather than maybe

576
00:25:53,280 --> 00:25:54,159
Speaker 2: paying one percent.

577
00:25:54,200 --> 00:25:57,040
Speaker 1: It's something you DIY too, Like you can sell and

578
00:25:57,440 --> 00:26:00,240
Speaker 1: find the perfect times during the year, but it's easier

579
00:26:00,280 --> 00:26:02,600
Speaker 1: when an algorithm does it for you. Yeah, it's possible

580
00:26:02,600 --> 00:26:04,760
Speaker 1: to screw it up, do I wy ing it too? Sure,

581
00:26:04,800 --> 00:26:07,680
Speaker 1: So you just have to realize that there are potential pitfalls.

582
00:26:07,720 --> 00:26:09,679
Speaker 2: It literally is can be as simple as I know.

583
00:26:09,680 --> 00:26:11,720
Speaker 2: We talked about this during the on the show, but

584
00:26:11,840 --> 00:26:14,440
Speaker 2: I guess it was right after the pandemic, like as

585
00:26:14,520 --> 00:26:17,760
Speaker 2: things were taken that I just switched a lot. I

586
00:26:17,800 --> 00:26:20,600
Speaker 2: ended up selling a bunch of VU and instead bought VTI,

587
00:26:20,840 --> 00:26:23,880
Speaker 2: which from a portfolio standpoint for me, was pretty much

588
00:26:24,040 --> 00:26:27,200
Speaker 2: the minimal exact same thing. Yeah, but it was different

589
00:26:27,359 --> 00:26:29,919
Speaker 2: enough in the eyes of the irs that hey, I

590
00:26:29,960 --> 00:26:32,040
Speaker 2: was able to harvest some losses there.

591
00:26:32,080 --> 00:26:34,080
Speaker 1: And the cool thing is you can push You can't

592
00:26:34,080 --> 00:26:36,120
Speaker 1: you can only claim a small amount in any given year,

593
00:26:36,320 --> 00:26:38,440
Speaker 1: but if you have a lot of loss in one

594
00:26:38,440 --> 00:26:41,280
Speaker 1: specific year, you can continue to claim that in smaller,

595
00:26:41,600 --> 00:26:42,600
Speaker 1: small increments moving.

596
00:26:42,480 --> 00:26:45,320
Speaker 2: Forward, roll it forward, and definitely you probably got tax

597
00:26:45,359 --> 00:26:48,399
Speaker 2: losses for the next couple decades. Yeah, So we wanted

598
00:26:48,400 --> 00:26:50,119
Speaker 2: to mention Betterment because I think that could be the

599
00:26:50,200 --> 00:26:54,000
Speaker 2: perfect happy medium place to have your taxable brokerage account

600
00:26:54,119 --> 00:26:57,000
Speaker 2: because you're gonna certainly save a lot more than what

601
00:26:57,040 --> 00:27:00,000
Speaker 2: you're paying to a traditional financial advisor. But of course

602
00:27:00,080 --> 00:27:02,360
Speaker 2: you're going to get the upside of that tax lost

603
00:27:02,359 --> 00:27:05,639
Speaker 2: harvesting alongside also some other compelling reasons to use Betterment.

604
00:27:05,640 --> 00:27:08,399
Speaker 2: They've got some great tools over there as well. Like

605
00:27:08,440 --> 00:27:10,560
Speaker 2: one of the tools is, like, if you're thinking about

606
00:27:10,560 --> 00:27:13,919
Speaker 2: selling a certain number of shares of an ETF or

607
00:27:13,960 --> 00:27:15,879
Speaker 2: a stock. They'll just tell you, hey, this is what

608
00:27:15,920 --> 00:27:17,840
Speaker 2: you're going to owe in tax. That can come in

609
00:27:17,880 --> 00:27:19,760
Speaker 2: really handy if this is something that you're looking to

610
00:27:19,880 --> 00:27:22,960
Speaker 2: use less. As you know, some folks see their brokerage

611
00:27:22,960 --> 00:27:26,160
Speaker 2: account more as an additional retirement account. Some folks see

612
00:27:26,200 --> 00:27:28,040
Speaker 2: it as like, hey, I want to invest in this

613
00:27:28,520 --> 00:27:30,919
Speaker 2: within this vehicle for three to five years and then

614
00:27:30,920 --> 00:27:32,119
Speaker 2: I'm going to pull the trigger and then I'm going

615
00:27:32,200 --> 00:27:34,520
Speaker 2: to spend that money on something that I want to

616
00:27:34,600 --> 00:27:37,639
Speaker 2: enjoy at that point in life. But like a boat, yeah,

617
00:27:37,680 --> 00:27:42,440
Speaker 2: I mean particularly yeah, but that is a perfectly fine

618
00:27:42,480 --> 00:27:45,880
Speaker 2: reason I think to invest money. So yes, to invest

619
00:27:46,200 --> 00:27:48,199
Speaker 2: some money for certain number of years. But then Addie

620
00:27:48,240 --> 00:27:52,159
Speaker 2: asked about sector specific investing, and that's certainly something that

621
00:27:52,160 --> 00:27:54,760
Speaker 2: you can make a priority. But so much of it

622
00:27:54,800 --> 00:27:56,760
Speaker 2: is going to depend on your specific goals. It is

623
00:27:56,800 --> 00:27:58,680
Speaker 2: going to depend on your risk tolerance as well. It

624
00:27:58,760 --> 00:28:01,480
Speaker 2: depends on how complicated you want to make your investments.

625
00:28:01,800 --> 00:28:05,800
Speaker 2: Because you could invest in some precious metals, you can

626
00:28:05,880 --> 00:28:08,879
Speaker 2: dabble in reads a little bit, real estate investment trusts,

627
00:28:09,119 --> 00:28:12,199
Speaker 2: you could focus on the tech sector. All this is

628
00:28:12,280 --> 00:28:12,639
Speaker 2: up to you.

629
00:28:12,720 --> 00:28:14,320
Speaker 1: But we just go all in on Nvidia.

630
00:28:14,960 --> 00:28:16,840
Speaker 2: You could do that if you wanted to. I would

631
00:28:16,920 --> 00:28:19,720
Speaker 2: rather you do all of that than consume. Right, Like,

632
00:28:19,800 --> 00:28:21,919
Speaker 2: if on one hand you're looking at just spending that

633
00:28:22,000 --> 00:28:24,439
Speaker 2: money in frivolous ways, that doesn't bring you much joy,

634
00:28:24,680 --> 00:28:27,239
Speaker 2: But on the other hand, you're thinking about investing in

635
00:28:27,280 --> 00:28:30,400
Speaker 2: a more aggressive way that might be a little riskier. Okay, Well,

636
00:28:30,400 --> 00:28:32,680
Speaker 2: between the two those, I'd rather see you investing, even

637
00:28:32,720 --> 00:28:35,480
Speaker 2: if it's not something that for the vast majority of

638
00:28:35,480 --> 00:28:37,080
Speaker 2: folks I think you should be doing. Because it's not

639
00:28:37,280 --> 00:28:41,240
Speaker 2: necessary to build up a nice nest egg for retirement

640
00:28:41,440 --> 00:28:43,360
Speaker 2: by investing in these ways. You can just stick with

641
00:28:43,400 --> 00:28:46,400
Speaker 2: the simple SMP or the total stock market indexes out there.

642
00:28:46,400 --> 00:28:49,200
Speaker 1: And some people might accuse us of over simplifying things,

643
00:28:49,200 --> 00:28:53,480
Speaker 1: matt and in regards to investments. They might have a point.

644
00:28:53,640 --> 00:28:55,520
Speaker 1: It's something I've thought about for sure over the years. Right,

645
00:28:55,600 --> 00:28:58,360
Speaker 1: are we making it just too simplistic on the investing front?

646
00:28:58,360 --> 00:29:01,920
Speaker 1: Do you need kind of to to broaden your horizons

647
00:29:01,960 --> 00:29:04,880
Speaker 1: to make sure you have your money spread out in

648
00:29:04,880 --> 00:29:07,120
Speaker 1: an even more diversified manner than what we recommend with

649
00:29:07,200 --> 00:29:10,440
Speaker 1: kind of the simple investing approach. And I think ultimately,

650
00:29:10,640 --> 00:29:12,720
Speaker 1: for a lot of our listeners, our goal is for

651
00:29:12,800 --> 00:29:14,960
Speaker 1: them to do the thing right and to get money

652
00:29:15,000 --> 00:29:17,360
Speaker 1: into those accounts, to start growing that money for their future,

653
00:29:17,480 --> 00:29:19,960
Speaker 1: and it's less about perfect and I think sometimes that

654
00:29:20,880 --> 00:29:23,880
Speaker 1: attempt at perfect it is the enemy of something that's

655
00:29:24,040 --> 00:29:24,760
Speaker 1: not even just good.

656
00:29:24,800 --> 00:29:27,600
Speaker 2: That's great, sure, yeah, but I mean, honestly, like that's

657
00:29:27,640 --> 00:29:30,560
Speaker 2: where I see the fancier, more sophisticated ways of investing

658
00:29:30,640 --> 00:29:33,560
Speaker 2: as being what keeps people from investing in the SMP.

659
00:29:33,680 --> 00:29:36,880
Speaker 2: And not because the SMP is sub is inferior, but truly,

660
00:29:36,920 --> 00:29:39,320
Speaker 2: I mean, like over the past decade plus, the S

661
00:29:39,320 --> 00:29:43,760
Speaker 2: and P five hundred has outperformed even betterments this sub betterment.

662
00:29:43,800 --> 00:29:46,960
Speaker 2: They actually updated their core portfolio earlier this year to

663
00:29:47,080 --> 00:29:51,320
Speaker 2: weight heavier towards US equities because it has seen subpower

664
00:29:51,400 --> 00:29:53,120
Speaker 2: performance when you're comparing it to the S and P

665
00:29:53,200 --> 00:29:57,520
Speaker 2: of five hundred and So does that mean that the

666
00:29:58,200 --> 00:29:59,880
Speaker 2: that the US stock market is going to continue to

667
00:29:59,880 --> 00:30:02,000
Speaker 2: out the rest of the world.

668
00:30:02,200 --> 00:30:04,880
Speaker 1: I don't know, but probably not if history has anything

669
00:30:04,920 --> 00:30:07,720
Speaker 1: to teach us about, Like we could see we see

670
00:30:07,720 --> 00:30:11,280
Speaker 1: times of international ow performance versus US DOX two innother decades.

671
00:30:11,320 --> 00:30:14,280
Speaker 1: So it's It's hard to predict, but the one thing

672
00:30:14,280 --> 00:30:16,600
Speaker 1: I can predict is that the more complicated you make something,

673
00:30:16,760 --> 00:30:19,200
Speaker 1: the more people are gonna like say this is not

674
00:30:19,240 --> 00:30:19,440
Speaker 1: for me.

675
00:30:19,520 --> 00:30:21,120
Speaker 2: Yeap, They're gonna throw in the towel altogether.

676
00:30:21,240 --> 00:30:24,000
Speaker 1: Yep. And so yes, addie, if you choose to do

677
00:30:24,040 --> 00:30:25,960
Speaker 1: that and you want to complicate things a little more

678
00:30:26,000 --> 00:30:31,520
Speaker 1: and you want diversity, more diversification through some sector specific funds,

679
00:30:31,720 --> 00:30:33,760
Speaker 1: more power to you. It's just not something that we

680
00:30:33,960 --> 00:30:36,560
Speaker 1: think is a necessity, and so we'd actually encourage you

681
00:30:36,600 --> 00:30:38,600
Speaker 1: to go back and listen to episode seven thirty four

682
00:30:38,640 --> 00:30:41,680
Speaker 1: with Paul Merriman. His take is that having some small

683
00:30:41,720 --> 00:30:45,080
Speaker 1: cap value exposure over the long haul hasn't in recent years,

684
00:30:45,080 --> 00:30:48,040
Speaker 1: but over the long haul will result in outsized gains.

685
00:30:48,160 --> 00:30:49,920
Speaker 1: But he is also about keeping it simple, so he's

686
00:30:49,960 --> 00:30:53,640
Speaker 1: like one added step of complexity without without really overdoing it.

687
00:30:53,680 --> 00:30:56,719
Speaker 1: I think he advocates a simple too fund approach, and

688
00:30:56,800 --> 00:30:59,400
Speaker 1: I guess we think that for most investors dollar cost

689
00:30:59,440 --> 00:31:02,560
Speaker 1: averaging to one or two funds is ideal. It just

690
00:31:02,640 --> 00:31:04,600
Speaker 1: makes it more likely that you're going to do the thing.

691
00:31:04,800 --> 00:31:07,240
Speaker 1: It doesn't complicate things too much. I would say, another

692
00:31:07,240 --> 00:31:09,080
Speaker 1: episode worth listening to is the one we did with

693
00:31:09,160 --> 00:31:12,800
Speaker 1: Brian Ferraldi back in seven ninety four. He loves investing

694
00:31:12,840 --> 00:31:15,400
Speaker 1: in single stocks, but he doesn't recommend it for everyone.

695
00:31:15,440 --> 00:31:16,880
Speaker 1: In fact, for most people he thinks it's not a

696
00:31:16,880 --> 00:31:20,480
Speaker 1: good strategy. We're fans of whatever approach though that allows

697
00:31:20,520 --> 00:31:22,440
Speaker 1: you to stay the course and keep building wealth. And

698
00:31:22,480 --> 00:31:25,120
Speaker 1: if some of that is investing in individual stocks, but

699
00:31:25,200 --> 00:31:27,920
Speaker 1: while you're doing the basic, simple thing with the majority

700
00:31:27,920 --> 00:31:31,240
Speaker 1: of things. Just because you're interested more power, that's great

701
00:31:31,480 --> 00:31:35,080
Speaker 1: and enjoy. But I just think for most folks that's

702
00:31:35,200 --> 00:31:36,840
Speaker 1: not where their head's at. Their head is like, how

703
00:31:36,840 --> 00:31:39,440
Speaker 1: do I build wealth in a simple, repeatable fashion, And

704
00:31:39,480 --> 00:31:42,280
Speaker 1: that's kind of what we harp on and that's where

705
00:31:42,280 --> 00:31:43,920
Speaker 1: we put the majority of our emphasis.

706
00:31:43,960 --> 00:31:45,840
Speaker 2: That's right, Addie, So we hope that gets you pointed

707
00:31:45,840 --> 00:31:47,960
Speaker 2: in the right direction. Joel us here from our next

708
00:31:47,960 --> 00:31:50,040
Speaker 2: listener who is in a tight spot and so he's

709
00:31:50,080 --> 00:31:51,920
Speaker 2: looking to tap some retirement funds.

710
00:31:52,480 --> 00:31:55,400
Speaker 4: Hi, Matt and Joel, This is Terry from Jacksonville, Florida.

711
00:31:55,560 --> 00:31:57,240
Speaker 4: Been listening to you guys for a long time. Love

712
00:31:57,280 --> 00:31:59,800
Speaker 4: the podcast, Love everything that you do to spread financial

713
00:31:59,800 --> 00:32:04,040
Speaker 4: and information. Got an interesting roth Ira question for you

714
00:32:04,720 --> 00:32:08,360
Speaker 4: so I was considering cashing out an old Roth IRA

715
00:32:08,560 --> 00:32:12,200
Speaker 4: account to clear some small debt from a credit card,

716
00:32:13,080 --> 00:32:14,840
Speaker 4: And when I was doing so, I was trying to

717
00:32:14,880 --> 00:32:18,680
Speaker 4: figure out how much my original contributions to the Roth

718
00:32:18,720 --> 00:32:22,040
Speaker 4: account were versus what my gains were and what I

719
00:32:22,040 --> 00:32:24,200
Speaker 4: would be responsible for paying taxes on since it doesn't

720
00:32:24,240 --> 00:32:27,680
Speaker 4: qualify for any of the early withdrawals. The account was

721
00:32:28,760 --> 00:32:30,920
Speaker 4: from a previous employer from two thousand and eight. In

722
00:32:30,920 --> 00:32:33,040
Speaker 4: two thousand and nine, I do not still have those

723
00:32:33,080 --> 00:32:36,920
Speaker 4: tax accounts, and the account itself has changed hands from

724
00:32:36,920 --> 00:32:40,080
Speaker 4: a number of financial institutions, from Scott Trade to tdmor

725
00:32:40,160 --> 00:32:42,480
Speaker 4: Trade now to Charles Schwab, and they have no record

726
00:32:42,560 --> 00:32:45,680
Speaker 4: of telling me that either. My question is what's my

727
00:32:45,760 --> 00:32:48,280
Speaker 4: course of action here if I decided to go this route,

728
00:32:48,440 --> 00:32:51,040
Speaker 4: and if not, is this something that I need to

729
00:32:51,040 --> 00:32:54,240
Speaker 4: be doing with my current Roth account to keep track

730
00:32:54,280 --> 00:32:56,080
Speaker 4: of this for the future if I ever need to

731
00:32:56,200 --> 00:32:59,080
Speaker 4: tap into that for a critical time and critical time

732
00:32:59,080 --> 00:33:01,760
Speaker 4: and financial need. My wife has a similar account hasn't

733
00:33:01,760 --> 00:33:03,600
Speaker 4: worked in about ten years in an account, and that

734
00:33:03,640 --> 00:33:05,560
Speaker 4: account has been sitting there growing and we.

735
00:33:05,560 --> 00:33:06,400
Speaker 2: Just don't know how much.

736
00:33:06,440 --> 00:33:10,320
Speaker 4: The honest the starting point was versus versus what it

737
00:33:10,360 --> 00:33:13,840
Speaker 4: is now again, appreciate you taking my question. Hope you guys,

738
00:33:14,360 --> 00:33:16,240
Speaker 4: Hope you guys can figure this one out with me.

739
00:33:16,400 --> 00:33:19,440
Speaker 2: Thanks nice. So, Joel, it's worth mentioning right out of

740
00:33:19,440 --> 00:33:22,800
Speaker 2: the gate that Terry, he said wroth Ira, but he's

741
00:33:22,800 --> 00:33:26,000
Speaker 2: also mentioning the fact that this is an employer sponsored account.

742
00:33:26,120 --> 00:33:28,200
Speaker 2: So in his email he actually referred to it as

743
00:33:28,240 --> 00:33:29,720
Speaker 2: a Roth four one K on one hand of the

744
00:33:29,800 --> 00:33:31,480
Speaker 2: now at other points he called it a roth Ira.

745
00:33:31,600 --> 00:33:33,880
Speaker 2: So I'm assuming because of the employer part, he's talking

746
00:33:33,880 --> 00:33:34,880
Speaker 2: about a roth for one cat.

747
00:33:35,040 --> 00:33:36,600
Speaker 1: That's what I'm getting. Yeah, that's what I'm gathering too,

748
00:33:36,640 --> 00:33:37,520
Speaker 1: So that's how we'll address this.

749
00:33:37,560 --> 00:33:39,440
Speaker 2: We're just clarifying the language because there are two different.

750
00:33:39,200 --> 00:33:41,200
Speaker 1: Accounts, right, and they both have brought them the name

751
00:33:41,200 --> 00:33:44,160
Speaker 1: in that again, is where simplicity would be awesome in

752
00:33:44,160 --> 00:33:46,400
Speaker 1: the retirement account space. But there are a lot of

753
00:33:46,440 --> 00:33:49,120
Speaker 1: different accounts with different letters and numbers attached to them,

754
00:33:49,360 --> 00:33:52,040
Speaker 1: which can be just mind boggling for people who don't

755
00:33:52,320 --> 00:33:55,160
Speaker 1: spend a lot of their time, whether it's their job

756
00:33:55,280 --> 00:33:57,880
Speaker 1: or just their free time, thinking through these things. So Terry,

757
00:33:57,880 --> 00:33:59,440
Speaker 1: we will address this as though it's a WROTH four

758
00:33:59,560 --> 00:34:01,320
Speaker 1: one K, and we'll actually kind of allude to the

759
00:34:01,360 --> 00:34:03,520
Speaker 1: roth IRA in this too. But it does sound like

760
00:34:03,560 --> 00:34:06,000
Speaker 1: you've been jostled around to different brokerage firms that can

761
00:34:06,000 --> 00:34:08,720
Speaker 1: make a record keeping difficult. So what we would suggest

762
00:34:08,800 --> 00:34:10,560
Speaker 1: is to reach out to the HR department of your

763
00:34:10,560 --> 00:34:12,799
Speaker 1: old employer to see if they have records of your

764
00:34:12,840 --> 00:34:16,400
Speaker 1: accounts and your contribution amounts. That's at least one stone

765
00:34:16,400 --> 00:34:19,440
Speaker 1: worth turning over. And if you have an old account statement,

766
00:34:19,760 --> 00:34:21,239
Speaker 1: you might be able to reach out to the old

767
00:34:21,280 --> 00:34:25,040
Speaker 1: investment firm itself, although for you in particular, it seems

768
00:34:25,040 --> 00:34:27,920
Speaker 1: that both of those are now defunct. They've been purchased,

769
00:34:28,120 --> 00:34:31,759
Speaker 1: the original company has been wiped off the face of

770
00:34:31,800 --> 00:34:34,560
Speaker 1: the planet, so those records probably don't exist anymore. Those

771
00:34:34,600 --> 00:34:36,600
Speaker 1: are two potential ways to dig up the document you're

772
00:34:36,600 --> 00:34:38,719
Speaker 1: looking for, but honestly, it might.

773
00:34:38,640 --> 00:34:41,160
Speaker 2: Be a waste of your time in your essence, Yeah, yeah, no, exactly,

774
00:34:41,239 --> 00:34:43,960
Speaker 2: that's right, because we don't want you to cash out

775
00:34:44,000 --> 00:34:46,319
Speaker 2: your ROTH for one K funds the money that you've

776
00:34:46,360 --> 00:34:48,520
Speaker 2: got stashed away there to pay off what you refer

777
00:34:48,640 --> 00:34:53,319
Speaker 2: to as small credit card debt. That would be bad news.

778
00:34:53,320 --> 00:34:56,080
Speaker 2: Bears and that's for many reasons that are worth discussing here.

779
00:34:56,960 --> 00:35:01,120
Speaker 2: Because Joel, like you alluded to roth Ira contributions, they

780
00:35:01,120 --> 00:35:04,080
Speaker 2: can be taken out tax and penalty free, but Roth

781
00:35:04,400 --> 00:35:08,319
Speaker 2: four win k contributions don't receive the same treatment, which

782
00:35:08,400 --> 00:35:10,960
Speaker 2: means taking money out of that account, even if it

783
00:35:11,040 --> 00:35:14,720
Speaker 2: were below your contribution threshold, that's going to result in taxes.

784
00:35:14,760 --> 00:35:17,920
Speaker 2: It's gonna result in penalties, making it a in our opinion,

785
00:35:18,000 --> 00:35:20,840
Speaker 2: a massive financial mistake not to mention that you'd be

786
00:35:20,960 --> 00:35:25,120
Speaker 2: robbing future Terry of a much bigger, tax free nest

787
00:35:25,160 --> 00:35:27,319
Speaker 2: egg if you were to pull those dollars out now

788
00:35:27,320 --> 00:35:29,319
Speaker 2: as opposed to leaving them invested in the market.

789
00:35:29,400 --> 00:35:32,160
Speaker 1: Yeah, think about yourself, Terry, but yourself twenty years down

790
00:35:32,200 --> 00:35:35,080
Speaker 1: the line and you pull that money out Old Terry

791
00:35:35,200 --> 00:35:38,439
Speaker 1: right exactly, and young Terry super satisfied because you don't

792
00:35:38,440 --> 00:35:42,440
Speaker 1: have that debt lingering anymore. But future Terry is like

793
00:35:42,960 --> 00:35:47,279
Speaker 1: bawling because he realizes that there's not just like, I

794
00:35:47,280 --> 00:35:49,200
Speaker 1: don't know, you didn't say exactly how much you're planning

795
00:35:49,200 --> 00:35:51,400
Speaker 1: on pulling out, but maybe it's not just fifteen thousand

796
00:35:51,440 --> 00:35:54,759
Speaker 1: or ten thousand dollars less, it's the compounding returns of

797
00:35:54,800 --> 00:35:58,719
Speaker 1: that money than now future Terry doesn't have at his disposal.

798
00:35:58,920 --> 00:36:01,160
Speaker 1: So that is I think one of the biggest reasons

799
00:36:01,480 --> 00:36:05,040
Speaker 1: to not even consider going this route. Right, you need

800
00:36:05,040 --> 00:36:06,840
Speaker 1: to wait until you're fifty nine and a half to

801
00:36:06,920 --> 00:36:09,160
Speaker 1: withdraw money in that wroth for one K to be

802
00:36:09,200 --> 00:36:12,360
Speaker 1: tax and penalty free. And I'm not sure how small

803
00:36:12,400 --> 00:36:14,680
Speaker 1: this credit card debt is, but we'd much rather see

804
00:36:14,680 --> 00:36:16,400
Speaker 1: you living on a bare bones budget for something like

805
00:36:16,440 --> 00:36:18,640
Speaker 1: nine to twelve months so you can eradicate it in

806
00:36:18,680 --> 00:36:21,239
Speaker 1: a short order, leaving every single dollar that you're thinking

807
00:36:21,239 --> 00:36:23,239
Speaker 1: about taking out intact in your wroth for one K.

808
00:36:23,560 --> 00:36:26,359
Speaker 1: Because it has this double impact, right, it keeps those

809
00:36:26,400 --> 00:36:29,800
Speaker 1: dollars working for you, dramatically impacting your future net worth,

810
00:36:30,320 --> 00:36:33,239
Speaker 1: but it also helps you feel the pain of the

811
00:36:33,239 --> 00:36:35,520
Speaker 1: credit card debt that you've accrued. And it's not that

812
00:36:35,560 --> 00:36:37,440
Speaker 1: we're massacis. It's not that we want need it to

813
00:36:38,200 --> 00:36:40,759
Speaker 1: yeah exactly. We're not trying to like make you hate

814
00:36:40,760 --> 00:36:44,600
Speaker 1: your life, But tapping a retirement account it just feels

815
00:36:44,600 --> 00:36:46,359
Speaker 1: like the easy way out, which is why so many

816
00:36:46,360 --> 00:36:46,840
Speaker 1: people take it.

817
00:36:46,880 --> 00:36:47,040
Speaker 4: Matt.

818
00:36:47,080 --> 00:36:49,239
Speaker 1: When you see the statistics about people that touch their

819
00:36:49,280 --> 00:36:52,440
Speaker 1: retirement accounts early. It's sad, it's awful. And what happens

820
00:36:52,480 --> 00:36:56,919
Speaker 1: to as an American the average American leaves our job. Well,

821
00:36:57,239 --> 00:36:59,560
Speaker 1: they decide, oh, you know, there's like ten thousand bucks,

822
00:36:59,600 --> 00:37:01,839
Speaker 1: eight thousand bucks, my four one k might as well

823
00:37:01,920 --> 00:37:05,400
Speaker 1: just like crack the piggybank open. And the truth is

824
00:37:05,880 --> 00:37:07,799
Speaker 1: they do that, and because it's the easy way out,

825
00:37:07,920 --> 00:37:10,239
Speaker 1: they find themselves back in debt again, not too far

826
00:37:10,280 --> 00:37:13,719
Speaker 1: down the road, with a much lighter retirement account to boot.

827
00:37:13,760 --> 00:37:16,200
Speaker 1: And so our advice is to make a plan to

828
00:37:16,200 --> 00:37:19,239
Speaker 1: cut spending YEP, to funnel more money towards that debt

829
00:37:19,239 --> 00:37:20,680
Speaker 1: in the here and now so you can pay it

830
00:37:20,719 --> 00:37:24,040
Speaker 1: off quickly instead. But don't do anything with the wraw

831
00:37:24,120 --> 00:37:25,640
Speaker 1: four one k, leave that thing being Yeah.

832
00:37:25,600 --> 00:37:28,400
Speaker 2: Leave your retirement nest eck alone. And I think a

833
00:37:28,480 --> 00:37:31,640
Speaker 2: part of your plan could be to consider a balance

834
00:37:31,800 --> 00:37:34,879
Speaker 2: transfer credit card. And this is especially true if the

835
00:37:34,920 --> 00:37:37,920
Speaker 2: interest that you're paying on your credit card balance is

836
00:37:38,000 --> 00:37:40,520
Speaker 2: just incredibly frustrating and slowing you down.

837
00:37:41,200 --> 00:37:43,520
Speaker 1: I just be honest. With rising interest rates and rising

838
00:37:43,560 --> 00:37:44,920
Speaker 1: credit card interest rates, it probably is.

839
00:37:45,080 --> 00:37:47,839
Speaker 2: Really, I'm sure. Yeah, even if you have righted your

840
00:37:47,840 --> 00:37:50,359
Speaker 2: ways and you're not spending recklessly on that it could

841
00:37:50,360 --> 00:37:52,839
Speaker 2: just really slow things down as those rates have ticked up.

842
00:37:52,920 --> 00:37:55,800
Speaker 2: And so I think choosing a card with a long

843
00:37:55,960 --> 00:37:59,239
Speaker 2: enough zero percent interest rate where you feel confident that

844
00:37:59,280 --> 00:38:00,839
Speaker 2: you'll be able to pay it off in full within

845
00:38:00,840 --> 00:38:02,719
Speaker 2: that window could be the way to go. You're gonna

846
00:38:02,719 --> 00:38:05,160
Speaker 2: pay a transfer fee of three to four percent, but

847
00:38:05,280 --> 00:38:07,960
Speaker 2: it's worth not having. I think you know any interest

848
00:38:08,000 --> 00:38:12,240
Speaker 2: or crew for let's say fifteen, eighteen, even twenty one months,

849
00:38:12,560 --> 00:38:15,719
Speaker 2: if you have a plan. And I do kind of

850
00:38:15,719 --> 00:38:18,000
Speaker 2: feel like we're getting outside the bounds of your original question, Terry,

851
00:38:18,000 --> 00:38:20,880
Speaker 2: but we wanted to mention this because like alarm bells

852
00:38:20,880 --> 00:38:22,640
Speaker 2: are going off in our heads when we hear folks

853
00:38:22,680 --> 00:38:26,080
Speaker 2: talk about tapping the retirement accounts early for something that

854
00:38:26,120 --> 00:38:29,160
Speaker 2: feels temporary like it. It feels like a huge deal

855
00:38:29,200 --> 00:38:30,920
Speaker 2: to you right now, But we just feel that there

856
00:38:30,920 --> 00:38:33,480
Speaker 2: are better ways to proceed. There are different changes that

857
00:38:33,520 --> 00:38:35,120
Speaker 2: you can make and you're spending, there are different ways

858
00:38:35,239 --> 00:38:38,279
Speaker 2: you can impact your earning potential to focus on eliminating

859
00:38:38,320 --> 00:38:42,640
Speaker 2: this altogether without experiencing the permanent impacts of having withdrawn

860
00:38:42,640 --> 00:38:43,600
Speaker 2: some of your retirement funds.

861
00:38:43,640 --> 00:38:45,360
Speaker 1: So that's whey who you listen to in the personal

862
00:38:45,440 --> 00:38:47,399
Speaker 1: finance based Matters MAC because there are some people who

863
00:38:47,400 --> 00:38:49,960
Speaker 1: would who think the debt is the worst thing since

864
00:38:50,040 --> 00:38:52,439
Speaker 1: lif spread and whatever it takes to pay that off

865
00:38:52,440 --> 00:38:55,240
Speaker 1: in the shortest amount of time is the most prudent

866
00:38:55,239 --> 00:38:58,920
Speaker 1: thing to do. And again, we always take like shades

867
00:38:58,920 --> 00:39:01,839
Speaker 1: of gray happy medium, and that is not always true,

868
00:39:01,880 --> 00:39:04,280
Speaker 1: because you can do a lot of harm to yourself

869
00:39:04,520 --> 00:39:07,800
Speaker 1: preventing future wealth building activities. Even with something as egregious

870
00:39:07,840 --> 00:39:10,400
Speaker 1: as credit card debt, there are better ways to handle it.

871
00:39:10,440 --> 00:39:13,880
Speaker 1: And again, I think feeling the behavioral implications of what

872
00:39:13,920 --> 00:39:15,960
Speaker 1: it took to get in that credit card debt, marching

873
00:39:16,040 --> 00:39:19,279
Speaker 1: yourself slowly and steadily out of that is going to

874
00:39:19,360 --> 00:39:21,799
Speaker 1: make you feel different at the end of the day,

875
00:39:22,080 --> 00:39:26,800
Speaker 1: having achieved debt payoff by buckling down instead of tapping

876
00:39:26,840 --> 00:39:30,440
Speaker 1: the retirement account instead to get there sooner. And last, banaloigues,

877
00:39:30,440 --> 00:39:32,480
Speaker 1: I just want to mention that you're terry, that you're

878
00:39:32,480 --> 00:39:34,760
Speaker 1: a Schwab, and that's good. They're one of the biggest

879
00:39:34,760 --> 00:39:37,439
Speaker 1: low cost players in the game. That means record keeping

880
00:39:37,480 --> 00:39:40,320
Speaker 1: should become less of an issue moving forward. It can't

881
00:39:40,400 --> 00:39:43,239
Speaker 1: hurt to print out annual contribution statements for your own

882
00:39:43,480 --> 00:39:46,560
Speaker 1: personal records just in case. So if you stick those

883
00:39:46,600 --> 00:39:49,680
Speaker 1: in a file folder or something in a cabinet in

884
00:39:49,719 --> 00:39:52,279
Speaker 1: your house, then I think that can help you for

885
00:39:52,360 --> 00:39:53,720
Speaker 1: future record keeping purposes.

886
00:39:53,760 --> 00:39:55,640
Speaker 2: Cool. Well, you mentioned the forms. Done makes me think

887
00:39:55,640 --> 00:39:58,239
Speaker 2: of so one thing. So Terry, let's just say, just

888
00:39:58,280 --> 00:40:01,839
Speaker 2: in case, you were talking about Rothie IRA contributions. When

889
00:40:01,840 --> 00:40:04,560
Speaker 2: you make contributions to an IRA, the brokerage that you're

890
00:40:04,600 --> 00:40:07,960
Speaker 2: with has to issue you Form fifty four to ninety eight.

891
00:40:08,040 --> 00:40:10,600
Speaker 2: And that is a way that actually I personally have

892
00:40:11,719 --> 00:40:14,319
Speaker 2: needed to go back to previous brokerages to get some

893
00:40:14,320 --> 00:40:16,239
Speaker 2: of those forms because I was like, wait a minute, yeah,

894
00:40:16,280 --> 00:40:19,319
Speaker 2: you can tap contributions if you were in a pinch.

895
00:40:19,360 --> 00:40:20,959
Speaker 2: And this was a situation where Kate and I found

896
00:40:20,960 --> 00:40:24,840
Speaker 2: ourselves in years ago where we're like, oh man, income's

897
00:40:24,840 --> 00:40:27,359
Speaker 2: looking pretty low this year. We've got some financial goals

898
00:40:27,400 --> 00:40:30,160
Speaker 2: that we're looking to hit. Maybe let's just consider this

899
00:40:30,200 --> 00:40:32,360
Speaker 2: is just something we were considering. And I had to

900
00:40:32,400 --> 00:40:35,319
Speaker 2: reach back out to E Trade because my first roth

901
00:40:35,360 --> 00:40:38,239
Speaker 2: IRA was with E Trade and they sent me the

902
00:40:38,560 --> 00:40:41,120
Speaker 2: forms and so it takes a little bit more legwork,

903
00:40:41,160 --> 00:40:43,520
Speaker 2: but that's when you can reach out to the brokerage

904
00:40:43,560 --> 00:40:45,680
Speaker 2: directly in order to keep up with that on your own.

905
00:40:45,719 --> 00:40:47,719
Speaker 2: And I will say, prior to that, I had never

906
00:40:47,920 --> 00:40:52,000
Speaker 2: kept up with my contributions, my retirement contributions with my IRA,

907
00:40:52,120 --> 00:40:54,279
Speaker 2: and I never had a four one K before that

908
00:40:54,560 --> 00:40:56,840
Speaker 2: at that point anyway, And of course Joel, you're not

909
00:40:56,880 --> 00:40:59,920
Speaker 2: surprised to hear that. That's when I started my investment

910
00:40:59,880 --> 00:41:02,920
Speaker 2: Bounce's contribute. I had a sheet that I added to

911
00:41:02,920 --> 00:41:06,080
Speaker 2: to my excel file. Yeah, sounds like you, because I

912
00:41:06,120 --> 00:41:07,320
Speaker 2: just want to be able to keep up with that

913
00:41:07,360 --> 00:41:07,680
Speaker 2: on my AM.

914
00:41:07,719 --> 00:41:09,719
Speaker 1: And I think it's worth mentioning really quickly. If Terry

915
00:41:09,840 --> 00:41:12,399
Speaker 1: was talking about a roth Ira, well, the great thing,

916
00:41:12,440 --> 00:41:14,319
Speaker 1: the cool thing about roth IRA's when we talk about this,

917
00:41:14,360 --> 00:41:16,880
Speaker 1: is that you can tap those contributions tax and penalty free,

918
00:41:16,920 --> 00:41:19,040
Speaker 1: so you could go back get that forum realized. Wait

919
00:41:19,040 --> 00:41:21,680
Speaker 1: a second, over the last six years, I have contributed

920
00:41:21,920 --> 00:41:24,160
Speaker 1: twelve thousand dollars, let's say, and I could pull all

921
00:41:24,200 --> 00:41:27,600
Speaker 1: that out right now, pay off the credit card debt,

922
00:41:27,920 --> 00:41:30,040
Speaker 1: no harm, no foul, right because I didn't have to

923
00:41:30,040 --> 00:41:31,920
Speaker 1: pay any taxes or penalties. Matt and Joel will love

924
00:41:31,960 --> 00:41:34,680
Speaker 1: that plan. If it's a roth Ira, you can do that.

925
00:41:34,680 --> 00:41:36,239
Speaker 2: That is more flexibility there.

926
00:41:36,320 --> 00:41:38,360
Speaker 1: That is a touchier subjective if we're talking about a

927
00:41:38,400 --> 00:41:41,560
Speaker 1: roth ira, because you're right, you don't pay taxes and penalties,

928
00:41:41,600 --> 00:41:45,000
Speaker 1: but you're talking about money that's in a tax advantaged

929
00:41:45,040 --> 00:41:47,440
Speaker 1: account that you've already paid tax on the growth of

930
00:41:47,480 --> 00:41:49,320
Speaker 1: which you'll never pay tax on again in the future.

931
00:41:49,760 --> 00:41:51,879
Speaker 1: I still like the idea. I think of buckling down

932
00:41:52,200 --> 00:41:53,840
Speaker 1: if you can pay it off in short order and

933
00:41:53,960 --> 00:41:56,640
Speaker 1: leaving the money in the roth ira doing even though

934
00:41:56,680 --> 00:41:59,160
Speaker 1: you could tap it without like the excessive penalties.

935
00:41:59,239 --> 00:42:01,879
Speaker 2: Yeah, the the principal soul stands that we would want

936
00:42:01,920 --> 00:42:04,759
Speaker 2: you to try to do everything else possible in order

937
00:42:04,800 --> 00:42:07,040
Speaker 2: to find a way to eliminate that debt without touching

938
00:42:07,080 --> 00:42:08,200
Speaker 2: those retirement savings.

939
00:42:08,239 --> 00:42:10,560
Speaker 1: All right, Matt, We've got more to get to, including

940
00:42:10,800 --> 00:42:13,720
Speaker 1: what's better renting or buying. Oh, it's a touchy subject,

941
00:42:13,760 --> 00:42:15,279
Speaker 1: but we'll talk about that right after this.

942
00:42:23,280 --> 00:42:25,520
Speaker 2: We are back from the break and it is now

943
00:42:25,640 --> 00:42:28,319
Speaker 2: time for the Facebook Question of the Week. Joel. This

944
00:42:28,400 --> 00:42:32,839
Speaker 2: is from an anonymous poster, and the question is our

945
00:42:32,880 --> 00:42:36,000
Speaker 2: mortgage payments typically cheaper than rent. I sometimes hear of

946
00:42:36,040 --> 00:42:38,640
Speaker 2: people who only made a small down payment on their home,

947
00:42:38,719 --> 00:42:41,440
Speaker 2: say five percent who say they're now paying less than

948
00:42:41,480 --> 00:42:44,319
Speaker 2: what they'd pay for rent. However, in my area, I

949
00:42:44,360 --> 00:42:47,160
Speaker 2: can't rent a three bedroom, single family home for around

950
00:42:47,160 --> 00:42:49,560
Speaker 2: two thousand dollars a month. A similar home in my

951
00:42:49,680 --> 00:42:52,200
Speaker 2: area would go for about three hundred and seventy thousand,

952
00:42:52,239 --> 00:42:54,440
Speaker 2: and this would end up being around twenty seven hundred

953
00:42:54,440 --> 00:42:57,960
Speaker 2: dollars a month at the moment with PMI, taxes, taxes,

954
00:42:58,000 --> 00:43:01,719
Speaker 2: and insurance after putting down a percent down payment if

955
00:43:01,719 --> 00:43:04,040
Speaker 2: I continue renting, I am the type to invest the

956
00:43:04,040 --> 00:43:06,319
Speaker 2: difference in mutual funds and keep that down payment in

957
00:43:06,360 --> 00:43:09,080
Speaker 2: a high yield savings account where it would make about

958
00:43:09,080 --> 00:43:11,360
Speaker 2: eighteen hundred dollars a year. I'd love to buy a

959
00:43:11,360 --> 00:43:13,440
Speaker 2: home if it would save me money. And I notice

960
00:43:13,440 --> 00:43:15,520
Speaker 2: people saying that sometimes, but I don't know if they

961
00:43:15,560 --> 00:43:18,880
Speaker 2: mean they bought back when interest rates were nothing, or

962
00:43:18,960 --> 00:43:21,600
Speaker 2: they mean you can actually go out now and find

963
00:43:21,640 --> 00:43:24,120
Speaker 2: this sort of situation. I like how this poster said

964
00:43:24,160 --> 00:43:27,759
Speaker 2: back when interest rates were nothing, because that's truly what

965
00:43:27,840 --> 00:43:29,239
Speaker 2: it feels like. I'm sure for a lot of folks

966
00:43:29,239 --> 00:43:31,319
Speaker 2: who are who are looking to purchase a home today.

967
00:43:31,320 --> 00:43:34,640
Speaker 1: Sure, yeah, timing is not on your side. It feels

968
00:43:34,680 --> 00:43:37,080
Speaker 1: like there has been a massive shift. And if you

969
00:43:37,120 --> 00:43:39,799
Speaker 1: bought your home five plus years ago, you're thanking your

970
00:43:39,880 --> 00:43:43,400
Speaker 1: lucky stars. And if you are like weighted, you punted

971
00:43:43,640 --> 00:43:46,600
Speaker 1: just for a little while, you're probably feeling the eight

972
00:43:46,960 --> 00:43:50,200
Speaker 1: inside that you didn't pounce earlier. And really, real estate

973
00:43:50,280 --> 00:43:53,319
Speaker 1: is incredibly dependent on timing, right if you bought, If

974
00:43:53,320 --> 00:43:55,560
Speaker 1: you bought a house in the nine to thirteen timeframe

975
00:43:55,840 --> 00:43:58,040
Speaker 1: and you're still living in it, you're locked in low

976
00:43:58,120 --> 00:44:02,200
Speaker 1: mortgage rate combined within inexpensive sales price. It would mean

977
00:44:02,239 --> 00:44:04,840
Speaker 1: that you're paying far less than anyone who's renting something

978
00:44:04,840 --> 00:44:07,680
Speaker 1: similar around the corner if they just signed the lease

979
00:44:08,040 --> 00:44:10,719
Speaker 1: last month. Right, But if you bought in twenty twenty three,

980
00:44:11,000 --> 00:44:14,120
Speaker 1: your mortgage amount is likely higher than what someone around

981
00:44:14,160 --> 00:44:17,680
Speaker 1: the corner is paying. So, for example, Matt, I have

982
00:44:17,920 --> 00:44:20,440
Speaker 1: had a rental property that I recently sold that the

983
00:44:20,440 --> 00:44:22,160
Speaker 1: only rental property have ever sold because it was a

984
00:44:22,160 --> 00:44:23,839
Speaker 1: primary and I was trying to avoid tax blah blah

985
00:44:23,840 --> 00:44:26,360
Speaker 1: blah blah blah. But the amount I was renting that

986
00:44:26,400 --> 00:44:30,360
Speaker 1: property out for was far cheaper than what the equivalent

987
00:44:30,400 --> 00:44:33,160
Speaker 1: mortgage is going to be for the people who just

988
00:44:33,200 --> 00:44:36,720
Speaker 1: bought the home, So they would have been better off

989
00:44:37,120 --> 00:44:40,000
Speaker 1: renting the property at least from a monthly expense standpoint.

990
00:44:40,080 --> 00:44:42,200
Speaker 1: And that is just still get the same house, right,

991
00:44:43,080 --> 00:44:45,520
Speaker 1: And that's not the ownership, of course, that's true, and

992
00:44:45,719 --> 00:44:48,720
Speaker 1: that's just the gap between rent and mortgage. That doesn't

993
00:44:48,760 --> 00:44:51,160
Speaker 1: take into account all the other factors too. So it's

994
00:44:51,200 --> 00:44:54,160
Speaker 1: significantly more expensive on a monthly basis to buy that

995
00:44:54,200 --> 00:44:55,360
Speaker 1: home than it was to rent it.

996
00:44:55,480 --> 00:44:58,640
Speaker 2: Yeah, and truly rates do, I mean rates and home

997
00:44:58,719 --> 00:45:01,680
Speaker 2: values are the big driver of why it's so much

998
00:45:01,680 --> 00:45:04,799
Speaker 2: more difficult today. And I think a reason why this

999
00:45:05,000 --> 00:45:08,040
Speaker 2: poster has maybe heard folks saying this is the fact

1000
00:45:08,080 --> 00:45:10,920
Speaker 2: that here's a stat for you. Over eighty percent of

1001
00:45:10,960 --> 00:45:13,880
Speaker 2: mortgage holders today have a rate at five percent or lower.

1002
00:45:14,080 --> 00:45:16,680
Speaker 2: And so yes, folks who are buying new homes today

1003
00:45:16,920 --> 00:45:20,280
Speaker 2: are looking at seven plus percent, but the vast majority

1004
00:45:20,320 --> 00:45:22,520
Speaker 2: of folks have rates that are locked in at far

1005
00:45:22,719 --> 00:45:25,759
Speaker 2: lower levels. And to take a step back into like

1006
00:45:25,800 --> 00:45:28,000
Speaker 2: the macro economy a little bit, this is this is

1007
00:45:28,040 --> 00:45:30,560
Speaker 2: one of the reasons why inflation has been so sticky

1008
00:45:31,040 --> 00:45:34,040
Speaker 2: because of the fact that the biggest line item that

1009
00:45:34,080 --> 00:45:36,080
Speaker 2: we experienced every single month in our budgets is what

1010
00:45:36,320 --> 00:45:39,759
Speaker 2: it's housing. And when you raise interest rates, guess what

1011
00:45:39,840 --> 00:45:43,400
Speaker 2: happens to your mortgage. Nothing. When you're locked in at

1012
00:45:43,440 --> 00:45:46,239
Speaker 2: a thirty year mortgage, that is not an expense that

1013
00:45:46,280 --> 00:45:49,040
Speaker 2: you see go up as opposed to other countries where

1014
00:45:49,080 --> 00:45:53,040
Speaker 2: mortgage is reset. That is why, for instance, that's at

1015
00:45:53,120 --> 00:45:55,000
Speaker 2: least one of the reasons that we're likely only going

1016
00:45:55,040 --> 00:45:56,800
Speaker 2: to see one interest rate cut this year as opposed

1017
00:45:56,840 --> 00:45:58,279
Speaker 2: to what was like it was the end of last

1018
00:45:58,320 --> 00:46:00,319
Speaker 2: year that they're like, oh, there's gonna be three cuts

1019
00:46:00,320 --> 00:46:03,279
Speaker 2: the next year. That's when the markets are off. Yeah,

1020
00:46:03,360 --> 00:46:05,759
Speaker 2: that's just one of the reasons why inflation has been

1021
00:46:06,360 --> 00:46:08,360
Speaker 2: a little sticky. But enough about that. I wanted to

1022
00:46:08,400 --> 00:46:11,640
Speaker 2: also mention that so much comes down to where it

1023
00:46:11,680 --> 00:46:14,960
Speaker 2: is that you live, because real estate is incredibly local.

1024
00:46:15,440 --> 00:46:18,240
Speaker 2: Like it makes me think I've out in California, for instance,

1025
00:46:18,560 --> 00:46:20,480
Speaker 2: Like you would not only be hard pressed to buy

1026
00:46:20,480 --> 00:46:22,719
Speaker 2: a home, but you'd also be committing a lot more

1027
00:46:22,760 --> 00:46:25,880
Speaker 2: money every single month housing costs. Your mortgage could easily

1028
00:46:25,920 --> 00:46:28,520
Speaker 2: be double the rent for the same or at least

1029
00:46:28,640 --> 00:46:30,920
Speaker 2: a very similar home. But let's say you live in

1030
00:46:30,960 --> 00:46:34,520
Speaker 2: a market like Memphis, Tennessee, or you live in Alabama,

1031
00:46:34,640 --> 00:46:38,160
Speaker 2: you live in Birmingham or Cleveland out in the Midwest,

1032
00:46:38,480 --> 00:46:40,560
Speaker 2: you still might find that buying a home actually makes

1033
00:46:40,560 --> 00:46:42,279
Speaker 2: more financial sense. So so much of this comes down

1034
00:46:42,320 --> 00:46:44,480
Speaker 2: to where it is that you live within the United States.

1035
00:46:44,320 --> 00:46:47,000
Speaker 1: Right, So you're asking me broad question that, but this

1036
00:46:47,080 --> 00:46:49,880
Speaker 1: is such a highly specific market where it's like, well,

1037
00:46:49,880 --> 00:46:51,920
Speaker 1: where do you live? Because that is going to be

1038
00:46:52,320 --> 00:46:54,560
Speaker 1: a massive indicator on whether or not you're going to

1039
00:46:54,560 --> 00:46:57,759
Speaker 1: be able to save money by buying versus renting. And

1040
00:46:57,960 --> 00:47:00,360
Speaker 1: like we've talked about before on the show, Matt Apps

1041
00:47:00,400 --> 00:47:03,560
Speaker 1: in so many locations around the country, between how expensive

1042
00:47:03,600 --> 00:47:07,919
Speaker 1: it is to rent relatively inexpensive in comparison and buy

1043
00:47:08,280 --> 00:47:11,520
Speaker 1: incredibly expensive in so many markets has never been wider

1044
00:47:11,640 --> 00:47:14,040
Speaker 1: in a whole bunch of places. So at least on

1045
00:47:14,080 --> 00:47:16,160
Speaker 1: the surface, when you're talking about a macro level, it's

1046
00:47:16,200 --> 00:47:18,000
Speaker 1: going to be cheaper to rent than it is to

1047
00:47:18,000 --> 00:47:20,479
Speaker 1: buy in most places. And so yeah, payments are also,

1048
00:47:20,480 --> 00:47:22,120
Speaker 1: by the way, dependent on how much you put down,

1049
00:47:22,520 --> 00:47:24,880
Speaker 1: As this question ask or mentioned, the more money you

1050
00:47:24,960 --> 00:47:26,680
Speaker 1: save to put down on that home, the lower your

1051
00:47:26,719 --> 00:47:29,360
Speaker 1: monthly payment is going to be. And I mentioned the

1052
00:47:29,800 --> 00:47:32,840
Speaker 1: additional cost of home ownership those a balloon also in

1053
00:47:32,920 --> 00:47:36,719
Speaker 1: recent years thanks to inflation, taxes, insurance, maintenance, costs of

1054
00:47:36,760 --> 00:47:39,719
Speaker 1: prison significantly, all the costs, all the costs, and so

1055
00:47:40,080 --> 00:47:42,279
Speaker 1: we're factoring in sometimes. I mean, people look at the

1056
00:47:42,320 --> 00:47:44,120
Speaker 1: mortgage payment versus the rent, but there's so much more

1057
00:47:44,120 --> 00:47:46,840
Speaker 1: you have to take into consideration. Home Ownership can be

1058
00:47:46,880 --> 00:47:49,040
Speaker 1: a great goal, and it can be a potentially solid

1059
00:47:49,080 --> 00:47:51,840
Speaker 1: financial move, but it's just not a slam dunk in

1060
00:47:51,880 --> 00:47:55,799
Speaker 1: the way ownership advocates make it sound. That's particularly true

1061
00:47:55,800 --> 00:47:58,040
Speaker 1: in our economic climate, Matt. And that is particularly true

1062
00:47:58,080 --> 00:48:01,359
Speaker 1: as well for listeners like this who say I would

1063
00:48:01,440 --> 00:48:04,480
Speaker 1: be investing the difference, I would be holding onto that money,

1064
00:48:04,480 --> 00:48:06,719
Speaker 1: I would not be consuming it. Yeah, lots of times

1065
00:48:06,719 --> 00:48:08,799
Speaker 1: when you're renting, you're taking the cheaper rent amount, and

1066
00:48:08,840 --> 00:48:11,120
Speaker 1: a lot of renters are spending the access. But if

1067
00:48:11,160 --> 00:48:13,839
Speaker 1: you're going to bank the access, I think it puts

1068
00:48:13,880 --> 00:48:17,560
Speaker 1: an even bigger check mark in the box of continuing

1069
00:48:17,560 --> 00:48:20,239
Speaker 1: to rent, save up more money so that you have

1070
00:48:20,360 --> 00:48:23,000
Speaker 1: a larger nest to get your disposal for that purchase

1071
00:48:23,000 --> 00:48:23,839
Speaker 1: when you're finally ready.

1072
00:48:23,840 --> 00:48:25,600
Speaker 2: You got to be a little bit more disciplined, right,

1073
00:48:25,600 --> 00:48:27,880
Speaker 2: because you don't have that forced method of savings that

1074
00:48:27,920 --> 00:48:30,200
Speaker 2: homeowners are faced with where you have to make your

1075
00:48:30,239 --> 00:48:31,879
Speaker 2: mortgage payment if you want to stay in that house.

1076
00:48:32,600 --> 00:48:34,360
Speaker 2: But one other thing I want to mention too is

1077
00:48:34,360 --> 00:48:38,680
Speaker 2: that home ownership isn't just about the basic numbers. Because

1078
00:48:38,719 --> 00:48:40,520
Speaker 2: if you are in a good finished position, yeah, you

1079
00:48:40,560 --> 00:48:43,040
Speaker 2: got a solid down payment saved up, Sure, that's great.

1080
00:48:43,120 --> 00:48:47,640
Speaker 2: But homeownership also needs to suit your lifestyle goals because like,

1081
00:48:47,680 --> 00:48:49,640
Speaker 2: you can't just only look at the numbers. And it

1082
00:48:49,640 --> 00:48:52,000
Speaker 2: makes me think about like making a big life decision

1083
00:48:52,120 --> 00:48:54,560
Speaker 2: purely based on the numbers, Like it makes me think

1084
00:48:54,600 --> 00:48:58,799
Speaker 2: about going to medical school and you're thinking, oh, I'm

1085
00:48:58,800 --> 00:49:00,040
Speaker 2: gonna be a doctor. That way I can make a

1086
00:49:00,120 --> 00:49:02,359
Speaker 2: ton of money. Okay, there's a whole lot of other

1087
00:49:02,400 --> 00:49:03,960
Speaker 2: questions that you need to ask, like are you even

1088
00:49:03,960 --> 00:49:06,160
Speaker 2: interested in being a doctor at the side of blood?

1089
00:49:06,280 --> 00:49:08,560
Speaker 2: Do are you smart enough to be a doctor? Can

1090
00:49:08,560 --> 00:49:12,560
Speaker 2: you handle twelve years of higher education? Basically in order

1091
00:49:12,600 --> 00:49:13,920
Speaker 2: to get to that point?

1092
00:49:14,320 --> 00:49:15,640
Speaker 1: Would be a note to all those questions.

1093
00:49:15,680 --> 00:49:17,880
Speaker 2: Do you want to be on call? You no, like,

1094
00:49:17,880 --> 00:49:20,120
Speaker 2: depending on the type of medicine that you're getting into.

1095
00:49:20,200 --> 00:49:24,680
Speaker 2: And so there's just so much more to purchasing a

1096
00:49:24,719 --> 00:49:27,320
Speaker 2: home than all, right, do the numbers. Mike sense and

1097
00:49:27,360 --> 00:49:30,080
Speaker 2: I certainly understand this is how to money, and we're

1098
00:49:30,080 --> 00:49:32,440
Speaker 2: looking to optimize from a financial standpoint, but we just

1099
00:49:32,520 --> 00:49:34,000
Speaker 2: like to zoom out a little bit and look at

1100
00:49:34,000 --> 00:49:37,640
Speaker 2: the whole picture, not only the whole financial picture, like

1101
00:49:37,680 --> 00:49:40,640
Speaker 2: what are the additional maintenance costs, what does that look like,

1102
00:49:40,680 --> 00:49:43,000
Speaker 2: but also what it looks like from a lifestyle standpoint.

1103
00:49:43,040 --> 00:49:44,200
Speaker 2: If you want to be able to move, if you

1104
00:49:44,280 --> 00:49:46,759
Speaker 2: like exploring new places, you know, if you like to

1105
00:49:46,800 --> 00:49:48,640
Speaker 2: travel it done. These are all things that kind of

1106
00:49:49,000 --> 00:49:50,640
Speaker 2: point in the direction of renting to where you don't

1107
00:49:50,680 --> 00:49:52,480
Speaker 2: have to maintain the home so that you can travel,

1108
00:49:52,520 --> 00:49:54,560
Speaker 2: so that you can hop from city to city as

1109
00:49:54,560 --> 00:49:57,400
Speaker 2: opposed to being tied down to a specific location, because

1110
00:49:57,400 --> 00:49:59,279
Speaker 2: that's what that's what it's going to take to ensure

1111
00:49:59,280 --> 00:50:01,759
Speaker 2: that you make a smart financial move, not moving, you know,

1112
00:50:02,040 --> 00:50:03,839
Speaker 2: less than five years from now, if you're looking to

1113
00:50:03,880 --> 00:50:05,239
Speaker 2: purchase a home in twenty twenty four.

1114
00:50:05,320 --> 00:50:07,720
Speaker 1: One last thing I want to say, and potentially semi

1115
00:50:07,719 --> 00:50:10,719
Speaker 1: Devil's advocate of our position, is that rent is likely

1116
00:50:10,719 --> 00:50:12,560
Speaker 1: to increase over time while your mortgage is going to

1117
00:50:12,640 --> 00:50:14,879
Speaker 1: roughly stay the same. We've talked about the fact that

1118
00:50:15,200 --> 00:50:18,720
Speaker 1: your mortgage can essentially act as a bulwark against inflation

1119
00:50:19,160 --> 00:50:22,399
Speaker 1: for your finances, and so there is no easy, one

1120
00:50:22,440 --> 00:50:25,480
Speaker 1: size fits answer to this question. But that is one

1121
00:50:25,480 --> 00:50:27,680
Speaker 1: more thing to factor in to say, Okay, if I

1122
00:50:27,840 --> 00:50:29,440
Speaker 1: take out this mortgage, yes, it's going to cost me

1123
00:50:29,480 --> 00:50:31,600
Speaker 1: more now, But ten years down the line, what's rent

1124
00:50:31,640 --> 00:50:33,320
Speaker 1: going to be in my town, in the place I

1125
00:50:33,360 --> 00:50:35,680
Speaker 1: want to live. And if I'm planning on staying in

1126
00:50:35,680 --> 00:50:38,880
Speaker 1: this place, even though my mortgage is initially more expensive,

1127
00:50:39,160 --> 00:50:40,920
Speaker 1: it might not be a decade down the road, and

1128
00:50:40,920 --> 00:50:44,520
Speaker 1: that is at least something worth considering. So hopefully this

1129
00:50:44,520 --> 00:50:46,759
Speaker 1: gives you enough food for thought to make a smart

1130
00:50:46,800 --> 00:50:50,080
Speaker 1: decision when it comes to your own housing choice. But

1131
00:50:50,400 --> 00:50:52,440
Speaker 1: there's certainly a lot of inputs that you have to consider.

1132
00:50:52,880 --> 00:50:56,160
Speaker 1: This is It's just a complex question, it is, man,

1133
00:50:56,200 --> 00:50:56,600
Speaker 1: all right.

1134
00:50:56,520 --> 00:50:58,360
Speaker 2: Let's get to the beer that you and I enjoyed

1135
00:50:58,480 --> 00:51:02,120
Speaker 2: during this episode. This is the dutchess red And do

1136
00:51:02,200 --> 00:51:04,839
Speaker 2: they always say does it always say sweet cherry sour?

1137
00:51:04,880 --> 00:51:04,960
Speaker 4: On?

1138
00:51:05,000 --> 00:51:05,160
Speaker 6: There?

1139
00:51:05,320 --> 00:51:07,200
Speaker 2: This isn't like a special duchess, is it? This is

1140
00:51:07,200 --> 00:51:09,120
Speaker 2: like the standard duchess? I think so, I just have

1141
00:51:09,200 --> 00:51:11,560
Speaker 2: never had it in a can before, which I love

1142
00:51:11,840 --> 00:51:14,279
Speaker 2: because normally when you buy so back in the day,

1143
00:51:14,360 --> 00:51:15,759
Speaker 2: And when I say it back in the day, I'm like,

1144
00:51:15,800 --> 00:51:18,560
Speaker 2: I don't know. Five years ago when you got Duchess,

1145
00:51:18,560 --> 00:51:20,040
Speaker 2: you had to buy it in like a seven to

1146
00:51:20,040 --> 00:51:22,520
Speaker 2: fifty bottle, or like at a minimum, like one of

1147
00:51:22,520 --> 00:51:26,400
Speaker 2: those medium sized three or like five hundred millvater bottle

1148
00:51:26,440 --> 00:51:29,240
Speaker 2: sometimes too, which can be a lot for a sweeter

1149
00:51:29,320 --> 00:51:30,680
Speaker 2: beer like this, right.

1150
00:51:30,680 --> 00:51:32,319
Speaker 1: Especially for a beer with as much flavor.

1151
00:51:32,400 --> 00:51:34,200
Speaker 2: Yeah, I was waiting on you to take up the

1152
00:51:34,560 --> 00:51:37,280
Speaker 2: I hate sweet beers point.

1153
00:51:37,400 --> 00:51:39,520
Speaker 1: Well, I will say I do like this beer. I

1154
00:51:39,560 --> 00:51:41,799
Speaker 1: love cherry beers. But yes, this beer is a little

1155
00:51:41,800 --> 00:51:43,080
Speaker 1: sweet for my liking.

1156
00:51:43,280 --> 00:51:44,200
Speaker 2: I still like it.

1157
00:51:44,280 --> 00:51:46,400
Speaker 1: I still enjoy it, but it's not as tart or

1158
00:51:46,400 --> 00:51:49,279
Speaker 1: funky as I want a cherry sour to be. I

1159
00:51:49,360 --> 00:51:52,759
Speaker 1: like those other flavors infused in there, and some of

1160
00:51:52,840 --> 00:51:55,440
Speaker 1: like the funky vibes that so many of the Belgian

1161
00:51:55,520 --> 00:51:58,400
Speaker 1: breweries are able to produce. Yeah, this beer doesn't have

1162
00:51:58,480 --> 00:52:00,400
Speaker 1: much of that going on. It is more just straight

1163
00:52:00,440 --> 00:52:01,200
Speaker 1: up sweet cherry.

1164
00:52:01,280 --> 00:52:01,560
Speaker 2: Yeah.

1165
00:52:01,920 --> 00:52:02,759
Speaker 1: That being said, I still like it.

1166
00:52:02,760 --> 00:52:04,719
Speaker 2: It's still really good, much less funky. But yeah, the

1167
00:52:04,760 --> 00:52:07,160
Speaker 2: first thing is, I mean, you got that cherry sweetness.

1168
00:52:07,160 --> 00:52:09,759
Speaker 2: It's like this dark, sweet cherry with just like the

1169
00:52:09,800 --> 00:52:12,719
Speaker 2: tiniest little bit of pucker, which then kind of segues

1170
00:52:12,760 --> 00:52:16,640
Speaker 2: into the oakiness that you pick up on the barrels

1171
00:52:16,680 --> 00:52:20,000
Speaker 2: that they aged this beer in. But yeah, I've never

1172
00:52:20,000 --> 00:52:22,000
Speaker 2: seen it's never had this beer in this format in

1173
00:52:22,040 --> 00:52:24,600
Speaker 2: a can. And I truly think this is gonna I'm

1174
00:52:24,600 --> 00:52:27,280
Speaker 2: gonna go out to wherever I can. I'm I'm assuming

1175
00:52:27,320 --> 00:52:29,239
Speaker 2: you got this at the local bottle shop. Yeah, But

1176
00:52:29,280 --> 00:52:31,080
Speaker 2: to be able to have this in the fridge as

1177
00:52:31,120 --> 00:52:34,080
Speaker 2: like a dessert beer, like Kate and I would one

1178
00:52:34,480 --> 00:52:36,560
Speaker 2: split one of these like once a week. It's like

1179
00:52:36,600 --> 00:52:38,399
Speaker 2: a dessert in a glass. You know what I'm saying. Yeah,

1180
00:52:38,440 --> 00:52:40,719
Speaker 2: Oh yeah, I like so good, nice cherry cordial, but

1181
00:52:41,080 --> 00:52:44,240
Speaker 2: in beer form. Yeah, it's like a you into cherries

1182
00:52:44,280 --> 00:52:46,000
Speaker 2: or ports? Have you ever? Have you gotten those in

1183
00:52:46,040 --> 00:52:48,479
Speaker 2: your in your wine club? No? Have we talked about

1184
00:52:48,520 --> 00:52:49,560
Speaker 2: that on the show.

1185
00:52:49,560 --> 00:52:52,839
Speaker 1: Emily got me a wine club subscription for was it

1186
00:52:52,840 --> 00:52:56,160
Speaker 1: my birthday, I guess or yeah, earlier this year. Yeah,

1187
00:52:56,200 --> 00:52:58,080
Speaker 1: and that's been fun trying some new stuff.

1188
00:52:58,120 --> 00:52:59,480
Speaker 2: But have you gotten any dessert wines?

1189
00:52:59,520 --> 00:53:01,680
Speaker 1: So she knows I'm cheap, so correctly signature wines or

1190
00:53:01,719 --> 00:53:03,640
Speaker 1: I normally go to. I feel like as.

1191
00:53:03,600 --> 00:53:05,560
Speaker 2: Soon as the subscription is that, baby, well, I'm not

1192
00:53:05,560 --> 00:53:06,440
Speaker 2: sure we're gonna renew it.

1193
00:53:06,480 --> 00:53:08,919
Speaker 1: Thanks, it's really kind, but it's been.

1194
00:53:08,840 --> 00:53:10,040
Speaker 2: Fun, it's been real.

1195
00:53:10,200 --> 00:53:12,520
Speaker 1: I prefer Costco Wine blog as instead of like the

1196
00:53:12,560 --> 00:53:13,600
Speaker 1: other rating systems, are.

1197
00:53:13,480 --> 00:53:15,600
Speaker 2: Really good wines that you can you can by Costco.

1198
00:53:15,640 --> 00:53:17,680
Speaker 2: That's what I'm saying. But I know it's a good

1199
00:53:17,680 --> 00:53:19,640
Speaker 2: one and glad we got to enjoy it today. It's good.

1200
00:53:19,800 --> 00:53:21,520
Speaker 1: All right, that's gonna do it. For this episode. We'll

1201
00:53:21,520 --> 00:53:23,719
Speaker 1: put links in the show notes to some of the

1202
00:53:23,800 --> 00:53:26,520
Speaker 1: resources that we mentioned today. And if you haven't been

1203
00:53:26,560 --> 00:53:28,440
Speaker 1: to the website recently, go check it out. Lots of

1204
00:53:28,440 --> 00:53:31,360
Speaker 1: new information being published all the time at how to

1205
00:53:31,440 --> 00:53:33,480
Speaker 1: money dot com to help you with your finances, to

1206
00:53:33,520 --> 00:53:35,799
Speaker 1: help you continue on in your journey, and if you

1207
00:53:35,840 --> 00:53:37,719
Speaker 1: just want to bite sized information every week, sign up

1208
00:53:37,719 --> 00:53:39,399
Speaker 1: for the newsletter over at how to money dot com

1209
00:53:39,400 --> 00:53:40,200
Speaker 1: slash newsletter.

1210
00:53:40,320 --> 00:53:42,239
Speaker 2: That's right, that's gonna be it, buddy, Until next time.

1211
00:53:42,440 --> 00:53:44,719
Speaker 2: Best Friends Out, Best Friends Out.