WEBVTT - Friday Flight - Chasing Returns, Free Refis, & Ridiculous Ramsey Rants #750 0:00:00.080 --> 0:00:03.160 Welcome to Head of Money. I'm Joel and I am Matt, 0:00:03.240 --> 0:00:08.080 and today we're talking chasing returns, free refise and ridiculous 0:00:08.280 --> 0:00:09.080 Ramsey rants. 0:00:28.320 --> 0:00:29.440 Yeah, dude, In fact, we. 0:00:29.480 --> 0:00:33.560 Are going to talk about the Dave during our episode today. 0:00:33.600 --> 0:00:37.960 I almost went with wretched instead of ridiculous. Way wretched. 0:00:38.479 --> 0:00:41.080 Yeah, ridiculous feels feels a little more accurate. Ratchet. 0:00:41.760 --> 0:00:45.040 Well, we do have a bunch of different personal finance 0:00:45.200 --> 0:00:46.839 news to get to. These are stories that we think 0:00:46.880 --> 0:00:49.280 are going to be most important when when it comes 0:00:49.320 --> 0:00:51.919 to your personal finances. But dude, before we dive into 0:00:51.960 --> 0:00:54.400 the stories, have we talked about the Companion Pass, the 0:00:54.400 --> 0:00:55.880 Southwest Companion Pass recently? 0:00:55.960 --> 0:00:57.240 It's definitely been featured on the show. 0:00:57.680 --> 0:01:00.280 Well, okay, so I don't think we've talked about though, 0:01:00.320 --> 0:01:03.400 how I have gotten it, or specifically, Kate's the one. 0:01:03.440 --> 0:01:07.600 She's actually the one who has the control over who 0:01:07.600 --> 0:01:08.240 gets the campaign. 0:01:08.880 --> 0:01:10.960 She named one, and am I up for grabs? 0:01:11.080 --> 0:01:13.880 Maybe she is a You are able to change who 0:01:13.959 --> 0:01:16.280 your companion is multiple times a year. 0:01:16.600 --> 0:01:19.640 But can I just say the campaign Pass Southwest Campaigon Pass, 0:01:19.680 --> 0:01:21.520 if you live in a Southwest city, it's the best. 0:01:21.840 --> 0:01:23.479 Is one of the coolest. 0:01:23.280 --> 0:01:26.080 Possible travel perks because you're able to, like you said, 0:01:26.120 --> 0:01:28.319 choose your companion and you can change it on occasion. 0:01:28.360 --> 0:01:31.160 Well, unlike other airlines, it is a free pass to fly, 0:01:31.440 --> 0:01:35.360 not just one time. That's an unlimited member. It's one 0:01:35.400 --> 0:01:37.759 of the sickest deals in travel that few people know about. It. Literally, 0:01:37.760 --> 0:01:39.560 you're flying for free. You just have to pay taxes 0:01:39.560 --> 0:01:43.360 and like aeronovital fees or something. September eleven security fee 0:01:43.440 --> 0:01:44.880 is like five dollars and sixty or something. 0:01:44.920 --> 0:01:45.360 Yeah. Okay. 0:01:45.360 --> 0:01:47.560 So the reason we are bringing this up, aside from 0:01:47.560 --> 0:01:49.400 the fact, I guess we haven't talked about it or 0:01:49.480 --> 0:01:52.000 talked about the fact that I was able to snag it, 0:01:52.080 --> 0:01:53.960 is the fact that now is the best time to 0:01:54.240 --> 0:01:58.440 apply for a Rapids reward card, because the idea is 0:01:58.520 --> 0:02:01.040 that you get that card now, but you start racking 0:02:01.120 --> 0:02:03.000 up those charges at the beginning of the year. You 0:02:03.000 --> 0:02:05.720 want those to hit in the next year, twenty twenty four, 0:02:05.960 --> 0:02:09.040 because once you get that companion passes good for the 0:02:09.080 --> 0:02:12.360 remainder of that year, but then also the entire subsequent 0:02:12.440 --> 0:02:14.480 year as well. So you're looking at close to two 0:02:14.600 --> 0:02:17.760 years of being able to fly anywhere with a companion 0:02:17.840 --> 0:02:18.359 for free. 0:02:18.400 --> 0:02:21.000 Just timing it right, it is huge, an extra like 0:02:21.000 --> 0:02:25.040 eleven months of having that free travel with for your companion. 0:02:24.720 --> 0:02:27.239 Exactly just now is the time. And if you're. 0:02:27.080 --> 0:02:29.480 Interested to know how to get it, how to do 0:02:29.520 --> 0:02:31.160 exactly what Matt did well, you can go to howd 0:02:31.200 --> 0:02:33.320 tomoney dot com and check out our recent article on that. 0:02:33.360 --> 0:02:34.919 We'll also link to it in the show notes for 0:02:35.080 --> 0:02:38.120 this episode. But it is one of the most underrated 0:02:38.160 --> 0:02:40.760 travel benefits that few people talk about. We talked about 0:02:40.760 --> 0:02:42.240 it with Lyn Metler a little bit back when we've 0:02:42.240 --> 0:02:45.240 talked about how to fly your family around for free 0:02:45.320 --> 0:02:48.079 the best way that this is truly the best way 0:02:48.120 --> 0:02:50.480 to get free travel. And at the same time, you're 0:02:50.480 --> 0:02:52.519 able to also get that free travel even when you 0:02:52.600 --> 0:02:55.359 spend points for your ticket, so he says, you're racking 0:02:55.440 --> 0:02:57.200 up a lot of points by getting those credit card. 0:02:57.080 --> 0:02:57.880 Sign up bonuses. 0:02:58.040 --> 0:03:01.120 You can both kind of essentially travel free for a 0:03:01.120 --> 0:03:03.040 lot of the next couple of years, in all likelihood for. 0:03:02.960 --> 0:03:05.360 A long time, and those points do not expire. And 0:03:05.360 --> 0:03:07.360 one of the key catches is the fact that you 0:03:07.880 --> 0:03:09.680 are able to get that one hundred and thirty five 0:03:09.680 --> 0:03:13.399 thousand points because you're also able to open a business 0:03:13.520 --> 0:03:16.960 rapid rewards card, and way more folks qualify for that 0:03:17.160 --> 0:03:19.800 then you actually would think details. 0:03:19.440 --> 0:03:20.880 In that article. But yeah, you're right, a lot of 0:03:20.880 --> 0:03:23.120 people think, oh business card, Oh most. 0:03:23.040 --> 0:03:25.880 People may get to qualify, and we explain it all 0:03:25.919 --> 0:03:26.399 in that article. 0:03:26.480 --> 0:03:27.840 Yeah, so yeah, we'll make sure to link to that. 0:03:27.960 --> 0:03:29.000 All right, but let's move on, Matt. 0:03:29.040 --> 0:03:31.000 Let's give it the Friday Flight quick sampling of stories 0:03:31.080 --> 0:03:33.239 we found to do it interesting this week. Let's start 0:03:33.240 --> 0:03:36.240 off talking about investing and the S and P five hundred, 0:03:36.240 --> 0:03:37.760 the stock market as a whole, the S and P 0:03:37.840 --> 0:03:40.640 five hundred and the Nasdaq in particular as well. They 0:03:40.720 --> 0:03:43.440 went into correction toward territory for a hot minute, but 0:03:44.120 --> 0:03:47.320 very quickly things changed on a dime in the market 0:03:47.400 --> 0:03:50.000 charge back up something like seven plus percent over the 0:03:50.000 --> 0:03:52.680 course of just two weeks, might have been more like 0:03:52.720 --> 0:03:55.480 eight or nine percents, and including a great week this 0:03:55.560 --> 0:03:58.960 week thanks to better than expected inflation numbers, we saw 0:03:59.000 --> 0:04:00.760 that kind of the CPI I never go down to 0:04:00.800 --> 0:04:03.320 three point two percent year over a year. We're actually 0:04:03.400 --> 0:04:07.480 seeing prices in some categories going down, which is welcome 0:04:07.520 --> 0:04:10.200 news for consumers. But the Wall Street Journal Publishing article 0:04:10.360 --> 0:04:14.600 about how this recent surge is getting investors excited. They're like, ooh, 0:04:14.720 --> 0:04:17.160 market go up. I went in on this, and so 0:04:17.480 --> 0:04:21.080 it prompted them to funnel more money into stocks. Basically, 0:04:21.120 --> 0:04:23.000 they don't want to be sitting on the sidelines while 0:04:23.000 --> 0:04:26.120 the market experiences a surge. And I totally get that. 0:04:26.160 --> 0:04:28.320 But the problem with this sort of mentality, Matt, we 0:04:28.360 --> 0:04:30.880 talk about it all the time, is attempting to chase 0:04:30.960 --> 0:04:33.679 returns is that you tend to be behind the curve 0:04:33.720 --> 0:04:35.880 when you take this tactic, you're often missing out on 0:04:35.880 --> 0:04:37.719 the bulk of the games. Hey, I missed out on 0:04:37.720 --> 0:04:39.520 that eight percent surge. I don't want to miss out 0:04:39.560 --> 0:04:42.480 on the next surge. But you got in, maybe sadly, 0:04:42.640 --> 0:04:44.560 at not the best time. And it makes you think 0:04:44.560 --> 0:04:47.360 of investors in the Arc Fund, Kathy Woods Arc Fund, 0:04:47.400 --> 0:04:50.560 this innovation fund, and guess what, almost all the money 0:04:50.600 --> 0:04:54.040 went in near the top. Same thing with bitcoin and cryptocurrency, right, 0:04:54.040 --> 0:04:56.640 a lot of the money getting went in right at 0:04:56.640 --> 0:04:59.640 the top before things kind of took a tumble. And 0:04:59.680 --> 0:05:01.719 we're all all for investing in the market, right, the 0:05:01.720 --> 0:05:03.880 more the merrior if you have a long enough time horizon. 0:05:04.120 --> 0:05:07.200 But the correction and the subsequent upward push, both of 0:05:07.200 --> 0:05:09.719 those things are just noise, right, And so investing regularly 0:05:09.720 --> 0:05:12.400 and dollar cost averaging are ways to head yourself from 0:05:12.440 --> 0:05:14.920 trying to time your entrance, which is going to lead 0:05:14.960 --> 0:05:17.600 to worse results overall. So, I don't know, it's this 0:05:17.720 --> 0:05:20.520 trend following sort of approach that people tend to take, 0:05:20.839 --> 0:05:22.560 and the best thing to do is to kind of 0:05:22.600 --> 0:05:24.800 like put on your blinders and just keep doing the 0:05:24.839 --> 0:05:26.520 same thing you're supposed to be doing, no matter what's 0:05:26.520 --> 0:05:27.320 happening with the market. 0:05:27.360 --> 0:05:30.880 Sure, that's right, but maybe use this excitement to go 0:05:30.920 --> 0:05:33.480 ahead and invest like you would have otherwise. Yeah, there 0:05:33.520 --> 0:05:35.520 is a lot more attention on investing, and if you 0:05:35.520 --> 0:05:37.400 haven't done that yet, go ahead and get started. So, 0:05:37.680 --> 0:05:40.440 speaking of investing, if you've got an HSA a health 0:05:40.480 --> 0:05:45.120 savings account, actually investing those dollars for your future, not 0:05:45.160 --> 0:05:48.200 saving those dollars, investing those dollars, basically using it as 0:05:48.279 --> 0:05:50.919 a third retirement account of sorts, well that's going to 0:05:50.960 --> 0:05:53.919 have a massive impact on your financial future. But the 0:05:54.000 --> 0:05:57.760 problem is most folks are still using their HSA like 0:05:57.960 --> 0:06:01.400 a savings account because maybe it's name that so they're 0:06:01.440 --> 0:06:03.320 just they're just following the directions on the. 0:06:03.320 --> 0:06:04.000 Label, yea, Joel. 0:06:04.440 --> 0:06:06.159 But I mean you can't blame them for it because 0:06:06.279 --> 0:06:08.599 the marketing's terrible exactly. But they're using it like a 0:06:08.640 --> 0:06:11.279 saving account to pay for those healthcare expenses in the 0:06:11.279 --> 0:06:13.920 current year. And sure that is going to provide a 0:06:13.920 --> 0:06:17.120 decent tax break, but it won't come even close to 0:06:17.120 --> 0:06:18.000 what it is that you can. 0:06:17.839 --> 0:06:20.640 Pull off if you put HSA dollars to work for 0:06:20.720 --> 0:06:23.320 you in the actual stock market. There's a new study 0:06:23.360 --> 0:06:26.280 and they found that only nineteen percent of folks use 0:06:26.320 --> 0:06:29.240 their HSA in this manner. It's sort of like putting 0:06:29.440 --> 0:06:32.000 a governor on a Ferrari, or like only using your 0:06:32.000 --> 0:06:34.360 Ferrari to like run to Aldi. Yeah yeah, yeah, And 0:06:34.400 --> 0:06:36.160 it's like it's capable of so much more. 0:06:36.440 --> 0:06:38.360 It's like one solid use, I guess, but if I 0:06:38.400 --> 0:06:40.600 had a Ferrari, I'd be doing so much more with it, exactly. 0:06:40.880 --> 0:06:41.159 Yeah. 0:06:41.200 --> 0:06:43.240 So we get that not everyone out there can afford 0:06:43.400 --> 0:06:46.240 to actually invest those dollars that you are needing to 0:06:46.320 --> 0:06:49.920 use those for some healthcare expenses, but we do eventually 0:06:49.960 --> 0:06:52.920 want you to invest those dollars. That should be the goal. 0:06:53.120 --> 0:06:54.680 And if you have plenty of cash on hand to 0:06:54.680 --> 0:06:56.919 pay for medical expenses out of pocket, we want you 0:06:56.960 --> 0:06:59.040 to think about investing your HSA dollars. 0:06:59.120 --> 0:06:59.640 It reminds me. 0:06:59.680 --> 0:07:02.440 I was talking to a buddy recently, and as we 0:07:02.480 --> 0:07:04.960 were talking, I remembered that this time last year, he 0:07:05.000 --> 0:07:07.919 reached out and was like, Hey, between these two health 0:07:07.960 --> 0:07:09.800 insurance plans and my employer is offering, which one do 0:07:09.800 --> 0:07:11.440 you think I should get? And I noticed one of 0:07:11.480 --> 0:07:13.640 them had HDHP up. 0:07:13.520 --> 0:07:13.920 At the top. 0:07:13.960 --> 0:07:17.080 It's a high deductible health care plan. And with that 0:07:17.160 --> 0:07:22.280 included the employer contributing fifteen hundred dollars to his family's HSA. 0:07:22.600 --> 0:07:24.200 Did you know that? Pretty sick? 0:07:24.360 --> 0:07:26.960 That's an amazing I mean that's a linking perk. A 0:07:27.000 --> 0:07:29.120 lot of employers to say five hundred bucks or one thousand. 0:07:28.880 --> 0:07:32.400 But fifteen I could not believe it. And here's the kicker. 0:07:32.400 --> 0:07:33.680 I asked him about that. I was like, oh, by 0:07:33.720 --> 0:07:36.400 the way, I remember we were talking about this. Did 0:07:36.480 --> 0:07:39.200 you ever go ahead and join and choose that? And 0:07:39.240 --> 0:07:41.400 he said, well, actually I thought I did, but I 0:07:41.440 --> 0:07:45.640 selected the wrong one. Oh no, So yeah, I'm hoping 0:07:45.640 --> 0:07:48.240 he's going to remedy his ways. Let's hope so this year. 0:07:48.240 --> 0:07:50.720 But basically you're giving that is it's a sweet, sweet perk, 0:07:50.720 --> 0:07:53.280 and you're giving up free money when your employer, free 0:07:53.280 --> 0:07:54.800 money for future you, which means it's going to be 0:07:54.800 --> 0:07:57.640 even larger than fifteen hundred dollars right now. Again, were 0:07:57.680 --> 0:07:58.960 you to invest those dollars. 0:07:59.000 --> 0:08:01.040 And again I get that huge percentage of people aren't 0:08:01.080 --> 0:08:03.560 doing it because most people don't know how powerful an 0:08:03.680 --> 0:08:05.360 HSA can be. That's why we're here to remind you 0:08:05.640 --> 0:08:08.200 it can be massively powerful now you know. Yeah, And 0:08:08.200 --> 0:08:09.720 we've got an article we'll link to in the show 0:08:09.760 --> 0:08:11.760 notes if you want to know exactly how to use 0:08:11.840 --> 0:08:14.400 and maximize your HSA if you have access to one, 0:08:14.560 --> 0:08:16.240 or let's talk about eighty us for a second. At 0:08:16.280 --> 0:08:19.720 Accessory dwelling units, we talk about them regularly. They're just like, hey, 0:08:19.720 --> 0:08:21.000 you want to build a mother in law suite in 0:08:21.000 --> 0:08:24.560 your backyard. That that's basically what an ADU is. And 0:08:24.960 --> 0:08:27.320 we've been fans for a while. I almost built one 0:08:27.440 --> 0:08:29.600 back at our in townhouse. It's like this close, but 0:08:29.680 --> 0:08:32.160 they were just like some minor zoning issues where I 0:08:32.200 --> 0:08:33.120 couldn't get past them. 0:08:33.200 --> 0:08:35.320 But the setbacks and whatnot. That's right, Yeah, it was. 0:08:35.320 --> 0:08:36.360 So I was like, oh, it's gonna have to be 0:08:36.400 --> 0:08:38.439 in the center of the yard. Now, I'm sorry, I'm 0:08:38.440 --> 0:08:42.160 not going to do that. But often people are like interested, 0:08:42.320 --> 0:08:45.080 but it's too expensive, right, and they've been hard to 0:08:45.120 --> 0:08:46.920 finance and then saving up something like one hundred and 0:08:46.920 --> 0:08:48.760 fifty K to build this thing. Even if it's going 0:08:48.840 --> 0:08:52.200 to generate income, it's like it's a bridge too far. 0:08:52.240 --> 0:08:54.160 Most people aren't going to be able to make it happen. 0:08:54.440 --> 0:08:57.240 But it's actually now getting easier to get a loan 0:08:57.320 --> 0:08:59.960 if you want to build an ADU because before lend 0:09:00.200 --> 0:09:03.400 were not able to consider the potential rental income that 0:09:03.440 --> 0:09:06.120 could you that could come from building that ADU, and 0:09:06.120 --> 0:09:09.120 now they can. So basically, if you're buying a house 0:09:09.200 --> 0:09:12.040 that currently has an ADU, the lender can factor in 0:09:12.160 --> 0:09:14.920 seventy five percent of the likely rent amounts into what 0:09:14.960 --> 0:09:17.680 they're willing to lend you to buy that house, which 0:09:17.720 --> 0:09:20.120 is cool because it might allow you to buy the 0:09:20.120 --> 0:09:23.000 house that's slightly more expensive with the ADU that's actually 0:09:23.000 --> 0:09:25.000 going to be better for your bottom line. And if 0:09:25.000 --> 0:09:27.800 you're trying to build a new ADU from scratch in 0:09:28.200 --> 0:09:30.200 your yard where you currently live, you can get a 0:09:30.240 --> 0:09:33.040 two h three K construction loan and a lender can 0:09:33.040 --> 0:09:36.440 consider fifty percent of the likely rental income of that 0:09:36.520 --> 0:09:38.920 ADU what it's likely to bring in. So just good 0:09:38.960 --> 0:09:40.599 news for folks who have listened to us and they're like, 0:09:40.640 --> 0:09:42.480 I love the ADU thing, but I don't have one 0:09:42.559 --> 0:09:44.360 hundred and fifty K on hand to build that thing 0:09:44.360 --> 0:09:48.120 from scratch. And yes, lending costs or hire, it's still 0:09:48.160 --> 0:09:51.520 not cheap to finance that ADU. But if you have 0:09:51.920 --> 0:09:54.120 enough cash to put towards that, and at the same 0:09:54.120 --> 0:09:55.760 time you're able to borrow some in order to get 0:09:55.760 --> 0:09:57.560 it to get it going, I think a lot of 0:09:57.559 --> 0:09:59.160 people are going to be more willing to go in 0:09:59.160 --> 0:10:00.559 the ADU direction totally. 0:10:00.800 --> 0:10:02.480 It's good to know that that's an option. And this 0:10:02.559 --> 0:10:05.800 is great news because more states and municipalities out there 0:10:05.800 --> 0:10:09.000 are allowing ADU construction. They've kind of gained steam, they've 0:10:09.000 --> 0:10:12.520 gotten more popular, but the borrowing guidelines hadn't kept up 0:10:12.600 --> 0:10:15.240 with that demand, with that desire for folks to build 0:10:15.280 --> 0:10:19.160 those in their yards. ADUs are great for increasing housing supply, 0:10:19.320 --> 0:10:21.400 that's another benefit, but they can also be perfect for 0:10:21.400 --> 0:10:23.600 folks who are wanting to get into the real estate 0:10:23.679 --> 0:10:24.520 investing game. 0:10:24.559 --> 0:10:26.360 It's just like a good way to test the waters. Yea. 0:10:26.400 --> 0:10:28.719 Like they're great for individuals, they're great for society as 0:10:28.720 --> 0:10:29.640 a whole, like eighty US. 0:10:29.679 --> 0:10:32.360 Great for cities. Yeah, they're not still increased density. 0:10:32.160 --> 0:10:35.240 Silver bullet or anything to produce kind of the lack 0:10:35.280 --> 0:10:37.200 of housing supply we have, but they're part of the 0:10:37.200 --> 0:10:38.480 solution at least exactly. 0:10:38.760 --> 0:10:39.000 Okay. 0:10:39.080 --> 0:10:42.160 So on the note of financing, lenders are now offering 0:10:42.200 --> 0:10:46.440 home buyers a free refinance perk, and so this is 0:10:46.559 --> 0:10:49.360 a story in the Times. Basically, if rates go down 0:10:49.360 --> 0:10:51.800 within the near future, what you can do is you 0:10:51.840 --> 0:10:53.840 go back to that same lender and you can refine 0:10:54.360 --> 0:10:58.040 without paying the massive closing costs that are typically associated 0:10:58.160 --> 0:11:01.840 with doing a refinance. These programs are all different, So 0:11:01.880 --> 0:11:04.200 what we would recommend is to read the fine print 0:11:04.240 --> 0:11:08.400 because some of these come with higher initial fees. And 0:11:08.480 --> 0:11:11.439 so if you are able to compare apples to apples 0:11:11.440 --> 0:11:13.840 and you see that there are not higher fees than sweet, 0:11:13.960 --> 0:11:16.520 obviously go with the one that has the free option. 0:11:16.960 --> 0:11:18.199 It's like a free meal down the road. 0:11:18.200 --> 0:11:20.040 It's like a free night's stay were you to come 0:11:20.080 --> 0:11:22.480 on back as long as you're not paying more for 0:11:22.559 --> 0:11:25.800 that initial night's day. But we think a better idea 0:11:25.800 --> 0:11:27.680 is just to do some more shopping and just find 0:11:27.720 --> 0:11:31.360 the lowest rates that are currently available. Certainly, it'll suck 0:11:31.400 --> 0:11:34.360 to pay to refine the future if rates do drop, 0:11:34.400 --> 0:11:36.839 which they might. We've seen rates took down over the 0:11:36.880 --> 0:11:39.600 past couple of weeks. But hoping that one of these 0:11:40.000 --> 0:11:42.920 kind of gimmicky maybe free refine mortgages will work out 0:11:43.280 --> 0:11:46.880 will likely cost you more if, in particular, if you're 0:11:46.880 --> 0:11:47.920 paying more on the front end. 0:11:47.960 --> 0:11:50.040 Yeah, or let's say it's like, oh, free REFI and 0:11:50.160 --> 0:11:52.160 potentially at some point in the future, but it comes 0:11:52.160 --> 0:11:55.040 with an initial quarter point higher rate or something like that, 0:11:55.080 --> 0:11:56.560 well's probably not worth that trade off. 0:11:56.480 --> 0:11:59.760 Right, you end up moving and never actually refinancing right 0:11:59.760 --> 0:12:01.480 before you end up selling that produs, that's right, And 0:12:01.760 --> 0:12:03.120 so we talk about this all the time. 0:12:03.360 --> 0:12:05.480 But there are stats out there about how if you 0:12:05.559 --> 0:12:07.760 just shop with at least three lenders, that's going to 0:12:07.840 --> 0:12:10.760 save you potentially thousands and thousands or maybe even five 0:12:10.840 --> 0:12:14.079 digits plus over the life of your loan if you 0:12:14.160 --> 0:12:16.200 just shop around. Most people, a lot of folks go 0:12:16.280 --> 0:12:19.199 to just one lender, they just get one quote, they 0:12:19.200 --> 0:12:21.480 go with that, and that is when you lose out. 0:12:21.600 --> 0:12:22.800 The most though exactly. 0:12:22.840 --> 0:12:25.280 And another thing, I was talking to a friend local 0:12:25.480 --> 0:12:28.520 lender and some thanks for offering a free recast of 0:12:28.559 --> 0:12:30.880 the mortgage, which is nice if you're not able to 0:12:30.880 --> 0:12:33.000 come to the table with a bunch of money. But again, 0:12:33.040 --> 0:12:35.600 if they're charging you more for that ability to do 0:12:35.960 --> 0:12:39.000 a recast, then that's not something I should say. A 0:12:39.040 --> 0:12:40.920 recast is it's sort of like a refi, but they 0:12:40.920 --> 0:12:44.800 don't change the interest rate of your mortgage. They basically 0:12:45.080 --> 0:12:47.280 reamateurize it. So if you come to the table with 0:12:47.320 --> 0:12:50.320 some more money after the fact, it just reduces your 0:12:50.320 --> 0:12:52.080 monthly payment, which is nice for like an extra one 0:12:52.120 --> 0:12:54.920 hundred k or something like after the exactly, like after 0:12:54.960 --> 0:12:56.200 the sale of a house in a year that you 0:12:56.200 --> 0:12:57.920 decide to hang on to. It's like, okay, now let's 0:12:57.960 --> 0:13:00.400 take those funds that we were planning originally the funnel 0:13:00.400 --> 0:13:01.240 towards the new place. 0:13:01.800 --> 0:13:03.120 Now we have the ability to do that. 0:13:03.240 --> 0:13:05.760 Yeah, and recasts don't get talked about much. Not many 0:13:05.760 --> 0:13:08.240 people use those, but it can be a great tool, 0:13:08.240 --> 0:13:10.520 I think, especially if you've got one of those higher 0:13:10.640 --> 0:13:12.920 trade mortgages. Right now, and you do come into some cash. 0:13:13.040 --> 0:13:15.600 Recasting is not a bad idea for some folks. And 0:13:15.920 --> 0:13:17.920 speaking of debt, Matt, let's talk about credit card balances. 0:13:17.920 --> 0:13:20.760 We've talked about how those balances have talked. A trillion 0:13:20.800 --> 0:13:24.800 dollars is kind of a headline number, and we talked 0:13:24.800 --> 0:13:26.520 about how it's kind of not as bad as it seems, 0:13:26.559 --> 0:13:29.760 right because given inflation, given the amount of money and 0:13:29.760 --> 0:13:32.360 people's bank accounts, that net worths have gone up across 0:13:32.440 --> 0:13:35.040 the board. Is it a crummy stat Do we hate 0:13:35.040 --> 0:13:37.040 to see it? Of course, But is it as bad 0:13:37.080 --> 0:13:38.280 as some people have made it seem? 0:13:38.440 --> 0:13:38.920 Not quite. 0:13:39.120 --> 0:13:40.880 And of course we want to see everyone pay off 0:13:40.920 --> 0:13:43.040 their credit card debt on time and in full. That 0:13:43.160 --> 0:13:45.480 is one of our golden rules of plastic that we 0:13:45.800 --> 0:13:48.000 talk about all the time. But just because the headline 0:13:48.040 --> 0:13:49.800 number isn't as bad as it seems, it doesn't mean 0:13:49.840 --> 0:13:51.800 that we're not seeing problems on the credit card front, 0:13:51.920 --> 0:13:54.880 because it turns out that delinquency rates are up significantly. 0:13:55.080 --> 0:13:57.320 The average credit card balance is now more than six 0:13:57.360 --> 0:13:59.960 thousand dollars, which is fifteen percent higher than. 0:14:00.160 --> 0:14:00.920 Was he a year ago. 0:14:00.920 --> 0:14:03.880 I think people are relying on their credit cards more 0:14:04.240 --> 0:14:06.719 than they were, and some of that stimmy money, like 0:14:06.760 --> 0:14:09.480 we talked talked about mad that's drying up. And so 0:14:09.679 --> 0:14:13.200 I think we're seeing an over reliance on credit cards 0:14:13.240 --> 0:14:15.400 from a lot of folks. And you know, as everybody knows, 0:14:15.440 --> 0:14:18.040 credit card debt comes with a variable interest rate, and 0:14:18.080 --> 0:14:20.480 those rates have been increasing like clockwork. So you know, 0:14:20.920 --> 0:14:22.880 we're not We're still fans of credit cards if you 0:14:22.960 --> 0:14:24.160 use them the right way. 0:14:24.240 --> 0:14:26.080 Like in order to score with the companion pass. Yeah, 0:14:26.080 --> 0:14:27.160 Southwest exactly. 0:14:27.360 --> 0:14:29.640 It's like, man, the perks can be massive, they can 0:14:29.640 --> 0:14:32.680 be significant, but credit card debt is bad through and through. 0:14:32.720 --> 0:14:33.080 That's right. 0:14:33.120 --> 0:14:35.200 It's gonna derail your personal finance. 0:14:34.920 --> 0:14:35.440 Goals for sure. 0:14:35.440 --> 0:14:37.400 I think it can just be a slippery, slippery slope. 0:14:37.440 --> 0:14:39.440 Like folks think, well, I'm just gonna go into debt 0:14:39.480 --> 0:14:42.120 a little bit, what's it. I'm not delinquent, I'm not 0:14:42.160 --> 0:14:44.400 behind on my payments, but way, what if I just 0:14:44.400 --> 0:14:45.320 make the minimum payment? 0:14:45.600 --> 0:14:46.440 What's the big deal? 0:14:46.840 --> 0:14:49.400 But it truly is a slippery slope, and once you 0:14:49.440 --> 0:14:51.280 start going down that path a little bit, it's going 0:14:51.360 --> 0:14:54.640 to keep you from achieving your different financial goals. Like 0:14:54.680 --> 0:14:56.680 it makes me think about like snacking on candy like 0:14:56.680 --> 0:14:58.840 it's been after Halloween now, and we've got these tubs 0:14:58.880 --> 0:15:01.360 because we did the buy back, which we never circled 0:15:01.360 --> 0:15:03.680 back around, and we ended up paying ten cents per 0:15:03.720 --> 0:15:06.920 piece of candy, and then twenty five cents a quarter 0:15:07.280 --> 0:15:10.040 for the full size or the king size bars, and 0:15:10.040 --> 0:15:12.520 so I'm going to pay thirty five next year. Our 0:15:12.600 --> 0:15:15.240 kids walk away with you with anywhere from three or 0:15:15.280 --> 0:15:18.240 four bucks for those that chose to keep us selects 0:15:18.480 --> 0:15:21.600 stash on hand to One of our daughters ended up 0:15:21.600 --> 0:15:23.800 selling all of her, like, literally every single piece back 0:15:23.800 --> 0:15:26.760 and walked away with I think closer to close to 0:15:26.800 --> 0:15:27.360 ten bucks. 0:15:27.400 --> 0:15:29.320 She does not have a sweet tooth. She well, she 0:15:29.640 --> 0:15:30.360 understood that. 0:15:30.680 --> 0:15:33.320 It doesn't mean that you weren't not that you weren't 0:15:33.320 --> 0:15:34.760 going to be able to have some candy at some point. 0:15:34.760 --> 0:15:37.360 It's just that it was more on our terms, and 0:15:37.440 --> 0:15:39.440 the selection was going to be a little more limited, huh, 0:15:39.440 --> 0:15:42.280 because of course mommy and daddy are going to get snacked, 0:15:42.520 --> 0:15:43.880 and she was all the good ones. And that's kind 0:15:43.920 --> 0:15:46.280 of what I'm getting at here, is that when that 0:15:46.440 --> 0:15:49.320 stash of candy is there, I think maybe I'll just 0:15:49.360 --> 0:15:51.240 snag one of those almond joys. What's the big deal? 0:15:51.280 --> 0:15:54.440 Maybe I'll take a butterfinger to work. In fact, maybe 0:15:54.480 --> 0:15:55.800 I should take a bunch of them to work, because 0:15:55.800 --> 0:15:58.280 it's nice to have somebody that work as well. But 0:15:58.280 --> 0:16:02.040 there's a mindset, mindset that takes place, and all of 0:16:02.080 --> 0:16:05.600 a sudden, subconsciously, I'm a snacker and like I'm like, 0:16:05.680 --> 0:16:07.320 I'm eating candy left and right. 0:16:07.560 --> 0:16:09.000 When had I. 0:16:08.800 --> 0:16:11.560 Looked at in this case, I guess my diet ahead 0:16:11.600 --> 0:16:13.360 of time, I would have said, well, no, I don't 0:16:13.400 --> 0:16:15.440 want to eat all of that candy. But there's like 0:16:15.480 --> 0:16:17.760 a shift that takes place when you start going down 0:16:17.800 --> 0:16:19.280 that path. And I think the same thing can be 0:16:19.320 --> 0:16:21.640 true when it comes to credit card use. You think, well, 0:16:21.720 --> 0:16:24.240 what's the big deal? But then after a couple months 0:16:24.280 --> 0:16:26.880 of maintaining a balance, you start thinking, well, I've already 0:16:26.920 --> 0:16:28.560 got the balance going, you know, li if we just 0:16:28.600 --> 0:16:31.000 add a few more hundred to it, And I think, 0:16:31.040 --> 0:16:32.960 in my mind, like, that's where it starts getting. 0:16:32.680 --> 0:16:34.400 A little dangerous. I mean, I think that's where your 0:16:34.400 --> 0:16:35.400 finances is get derailed. 0:16:35.400 --> 0:16:37.360