1 00:00:00,120 --> 00:00:02,759 Speaker 1: Welcome to How the Money. I'm Joel and I am Matt. 2 00:00:02,920 --> 00:00:26,880 Speaker 1: Today we're asking the question, is inflation making us crazy? Inflation? Man, 3 00:00:26,920 --> 00:00:28,920 Speaker 1: it has been in the headlines, and so we felt 4 00:00:28,920 --> 00:00:31,080 Speaker 1: that it was time for us to devote an entire 5 00:00:31,120 --> 00:00:33,960 Speaker 1: episode to talking about inflation a little bit more. We're 6 00:00:33,960 --> 00:00:36,880 Speaker 1: gonna do that during this episode. Inflation has us living 7 00:00:36,960 --> 00:00:40,120 Speaker 1: la vida loca, I would say, Matt. Uh, So, here's 8 00:00:40,120 --> 00:00:41,680 Speaker 1: the thing. Speaking of inflation, I wanted to tell you 9 00:00:41,680 --> 00:00:44,920 Speaker 1: a little story about where do you go get gash nearby? 10 00:00:45,080 --> 00:00:47,400 Speaker 1: So I don't know, it just depends on Usually it's 11 00:00:47,440 --> 00:00:50,360 Speaker 1: when I'm just at Costco. I try to fill up 12 00:00:50,360 --> 00:00:52,440 Speaker 1: at costcocause it's always cheaper than But there are a 13 00:00:52,479 --> 00:00:54,040 Speaker 1: couple of places. It turns out. I used to think 14 00:00:54,040 --> 00:00:56,520 Speaker 1: that the Kroger. The Kroger has got to be the 15 00:00:56,560 --> 00:00:59,240 Speaker 1: most expensive place. So that's what I was gonna say, 16 00:00:59,280 --> 00:01:01,040 Speaker 1: is we used to always go to the local Kroger. 17 00:01:01,080 --> 00:01:03,360 Speaker 1: It's really close to our house. Um, and because occasionally 18 00:01:03,360 --> 00:01:05,120 Speaker 1: we go to Kroger for some groceries and we always 19 00:01:05,160 --> 00:01:07,400 Speaker 1: have some points where we get the discounted price per 20 00:01:07,480 --> 00:01:10,960 Speaker 1: gallon on gas. But recently I noticed that just a 21 00:01:10,959 --> 00:01:13,240 Speaker 1: gas station a BP just a mile down the road. 22 00:01:13,480 --> 00:01:16,160 Speaker 1: It was something like twenty cents cheaper per gallon. Uh. 23 00:01:16,200 --> 00:01:17,840 Speaker 1: And here's the thing, this isn't a gas station that 24 00:01:17,880 --> 00:01:20,040 Speaker 1: I have to go out of my way to reach. 25 00:01:20,200 --> 00:01:22,520 Speaker 1: This is on the way to Aldie. We've always said 26 00:01:22,560 --> 00:01:24,520 Speaker 1: it's cheap if you're gonna drive across town of the same, 27 00:01:25,040 --> 00:01:27,600 Speaker 1: but if it's easy to save, go save the money, exactly. 28 00:01:27,840 --> 00:01:30,360 Speaker 1: And so initially I noticed this a couple of months ago, 29 00:01:30,400 --> 00:01:32,640 Speaker 1: And initially I thought that maybe they had just not 30 00:01:33,080 --> 00:01:34,959 Speaker 1: raised their prices, because this is when price we were 31 00:01:34,959 --> 00:01:38,680 Speaker 1: seeing prices take up pretty significantly, pretty dramatically. Uh. But dude, 32 00:01:38,840 --> 00:01:41,400 Speaker 1: it has consistently stayed twenty cents at least twenty cents 33 00:01:41,480 --> 00:01:44,160 Speaker 1: cheaper than Kroger, uh than the shell further up the 34 00:01:44,240 --> 00:01:46,840 Speaker 1: road as well. And so I have changed. I mean, 35 00:01:46,840 --> 00:01:48,360 Speaker 1: this isn't a big deal, right, Like, you're only talking 36 00:01:48,520 --> 00:01:50,320 Speaker 1: twenty cents per gallon, and we don't even drive all 37 00:01:50,360 --> 00:01:53,160 Speaker 1: that much. The bottom line doesn't impact us all that much. No, 38 00:01:53,640 --> 00:01:56,320 Speaker 1: But I wanted to share the story because it takes 39 00:01:56,800 --> 00:01:59,160 Speaker 1: breaking out of the habits and the mindset that we 40 00:01:59,200 --> 00:02:02,400 Speaker 1: typically do think sometimes in order to save us money. Right, 41 00:02:02,440 --> 00:02:04,480 Speaker 1: So I think like when it comes to groceries, sometimes 42 00:02:04,520 --> 00:02:06,240 Speaker 1: we might think, oh, well, we always have to get 43 00:02:06,280 --> 00:02:08,720 Speaker 1: this product or or this cut of meat. This is 44 00:02:08,760 --> 00:02:11,359 Speaker 1: we always eat ribbies, you know, we always eat boneless, 45 00:02:11,360 --> 00:02:14,520 Speaker 1: skinless chicken, yes exactly, but instead to consider some of 46 00:02:14,520 --> 00:02:17,200 Speaker 1: the other options. Ever, we're more flexible. That can save 47 00:02:17,280 --> 00:02:18,799 Speaker 1: us in a big way. It also makes me think 48 00:02:18,880 --> 00:02:20,799 Speaker 1: about like cell phone service. I was just talking to 49 00:02:20,840 --> 00:02:23,760 Speaker 1: a buddy recently and he was like, yeah, I'm still 50 00:02:23,800 --> 00:02:27,120 Speaker 1: paying a lot of money for my Verizon service. And 51 00:02:27,120 --> 00:02:29,680 Speaker 1: I spent a good five minutes and he was interested, 52 00:02:29,720 --> 00:02:31,600 Speaker 1: and I wasn't just like brading it down the throat, 53 00:02:31,600 --> 00:02:33,359 Speaker 1: and I was explaining to him h M v n 54 00:02:33,400 --> 00:02:35,920 Speaker 1: o s, which are the mobile virtual network operators which 55 00:02:35,960 --> 00:02:39,600 Speaker 1: operate on the backbones on the networks of the major 56 00:02:39,680 --> 00:02:42,560 Speaker 1: you know, big names, but they charge you a fraction 57 00:02:42,680 --> 00:02:44,600 Speaker 1: of the cost. And so, for instance, you and I 58 00:02:44,680 --> 00:02:47,560 Speaker 1: were on Mint Mobile, right, and they operate off of 59 00:02:47,639 --> 00:02:50,680 Speaker 1: T Mobiles networks, and you get all the great speed 60 00:02:50,680 --> 00:02:52,840 Speaker 1: that comes with a T mobile, uh service, but at 61 00:02:52,840 --> 00:02:55,040 Speaker 1: a fraction of the cost exactly. But so many people 62 00:02:55,120 --> 00:02:58,160 Speaker 1: are just stuck in their ways paying the same phone 63 00:02:58,160 --> 00:03:00,760 Speaker 1: company the same amount of money every single month. And 64 00:03:00,760 --> 00:03:03,760 Speaker 1: and yeah, actually right now, like Mint has that three 65 00:03:03,960 --> 00:03:07,360 Speaker 1: by three months, get three months, three get three so 66 00:03:07,400 --> 00:03:09,520 Speaker 1: it like takes that super cheap phone service down to 67 00:03:10,000 --> 00:03:13,399 Speaker 1: an even lower price for those new customers. So yeah, 68 00:03:13,440 --> 00:03:15,040 Speaker 1: well we'll link that in the show notes. By the way, 69 00:03:15,320 --> 00:03:18,160 Speaker 1: people want to know about it. But Matt, let's move on. 70 00:03:18,280 --> 00:03:20,320 Speaker 1: Let's talk about the beer that we're having on this show. 71 00:03:20,360 --> 00:03:27,280 Speaker 1: This one is called Chocolate Pecan Porter. Do you say pecan? Pecan? Uh? Pecan? Okay? Wecan? 72 00:03:27,440 --> 00:03:29,120 Speaker 1: I think I did like a blending of it too, 73 00:03:29,840 --> 00:03:31,440 Speaker 1: like a hybrid. I had it in my mind. So 74 00:03:31,760 --> 00:03:35,080 Speaker 1: I grew up saying pecan because I was raised in 75 00:03:35,120 --> 00:03:38,000 Speaker 1: the South. Yes, but now I say pecan because I 76 00:03:38,040 --> 00:03:42,080 Speaker 1: live in the city. Now you're you're very refined. But yeah, 77 00:03:42,480 --> 00:03:44,800 Speaker 1: this one is by Tim Blore Brewing, and this one 78 00:03:44,840 --> 00:03:47,640 Speaker 1: was sent to us by listener Ryan, who works for 79 00:03:47,680 --> 00:03:52,080 Speaker 1: the brewery. So we're always always down for delicious craft beers. Ryan, 80 00:03:52,120 --> 00:03:54,400 Speaker 1: thanks for sending these ones to us. But Matt, let's 81 00:03:54,400 --> 00:03:57,200 Speaker 1: get onto the subject at hand. Let's talk about inflation. 82 00:03:57,280 --> 00:03:59,360 Speaker 1: Let's do it. And you know, it just kind of 83 00:03:59,360 --> 00:04:01,920 Speaker 1: made me think the other today, how how nutty the 84 00:04:02,040 --> 00:04:05,600 Speaker 1: conversation around inflation has gotten. Uh it, I don't know why. 85 00:04:05,640 --> 00:04:07,560 Speaker 1: It kind of made me reflect on one of my 86 00:04:07,600 --> 00:04:11,400 Speaker 1: friends who like a decade ago, ended up getting diagnosed 87 00:04:11,400 --> 00:04:15,520 Speaker 1: with prostate cancer. And yeah, tough diagnosis to receive, and 88 00:04:15,520 --> 00:04:18,120 Speaker 1: it was like obviously just an emotionally difficult time for him, 89 00:04:18,160 --> 00:04:20,040 Speaker 1: for his friends and family, everybody who was close to 90 00:04:20,120 --> 00:04:23,520 Speaker 1: him and who loved him. Um, but there's this belief, 91 00:04:23,560 --> 00:04:25,760 Speaker 1: I think when it comes to cancer that you gotta 92 00:04:25,800 --> 00:04:29,120 Speaker 1: go like harden fast in order to eradicate it, right, 93 00:04:29,200 --> 00:04:32,880 Speaker 1: that it's the fight against cancer exactly exactly, And so 94 00:04:33,160 --> 00:04:35,159 Speaker 1: there's this, Yeah, there's this belief that you gotta treat it, 95 00:04:35,400 --> 00:04:38,040 Speaker 1: you know, treaty quickly, and you gotta throw like all 96 00:04:38,040 --> 00:04:41,600 Speaker 1: the ammunition at it at once, exactly. And so yeah, 97 00:04:41,640 --> 00:04:44,560 Speaker 1: for unfortunately, my friend, he's doing really really well these days. 98 00:04:44,600 --> 00:04:48,000 Speaker 1: But that's actually largely because he took the opposite approach. 99 00:04:48,200 --> 00:04:51,080 Speaker 1: He decided not to throw the kitchen snake at this cancer. 100 00:04:51,760 --> 00:04:54,600 Speaker 1: He decided to do something called watchful waiting or it's 101 00:04:54,640 --> 00:04:57,640 Speaker 1: also known as active surveillance in the prostate cancer community, 102 00:04:57,800 --> 00:04:59,680 Speaker 1: basically keeping an eye on the growth rate of the 103 00:04:59,680 --> 00:05:02,960 Speaker 1: cancer and the potential symptoms, so that action can be 104 00:05:03,000 --> 00:05:06,000 Speaker 1: taken if need be, But the point the hope is 105 00:05:06,040 --> 00:05:09,360 Speaker 1: to not take action too soon because that could actually 106 00:05:09,640 --> 00:05:12,279 Speaker 1: greatly diminish the quality of life for the patient. That 107 00:05:12,360 --> 00:05:16,360 Speaker 1: surgery is obviously invasive, and you and I were obviously 108 00:05:16,440 --> 00:05:20,520 Speaker 1: we're not doctors, were not cancer experts. Recently, we did 109 00:05:20,560 --> 00:05:22,520 Speaker 1: an episode where we talked about I feel like we 110 00:05:22,600 --> 00:05:24,560 Speaker 1: talked a lot about dieting recently, and so what we're 111 00:05:24,560 --> 00:05:27,960 Speaker 1: definitely not nutritionists, we're not doctors either. It's just anecdotal 112 00:05:28,000 --> 00:05:30,359 Speaker 1: evidence to support something that we're gonna talk about this 113 00:05:30,360 --> 00:05:33,479 Speaker 1: outside like we'd like to dabble, right, But it's just 114 00:05:33,560 --> 00:05:37,120 Speaker 1: interesting to see how overreacting can actually create more problems 115 00:05:37,160 --> 00:05:40,320 Speaker 1: depending on the circumstance that you're going through, right, And 116 00:05:40,640 --> 00:05:44,000 Speaker 1: so in this case, reacting too quickly and having that 117 00:05:44,120 --> 00:05:47,160 Speaker 1: invasive surgery could have had other more consequential side effects, 118 00:05:47,200 --> 00:05:50,000 Speaker 1: and so waiting made the most sense. And you know what, 119 00:05:50,120 --> 00:05:52,320 Speaker 1: in over a decade, he hasn't had to have any 120 00:05:52,320 --> 00:05:54,520 Speaker 1: surgery and he's living a great life. And so yeah, 121 00:05:54,560 --> 00:05:56,880 Speaker 1: could the same be true when it comes to inflation 122 00:05:57,200 --> 00:06:00,040 Speaker 1: that maybe we're overreacting a little bit. That's kind of 123 00:06:00,160 --> 00:06:02,160 Speaker 1: what we want to talk about today. Yeah, that's right. 124 00:06:02,200 --> 00:06:04,920 Speaker 1: You know, it's understandable that many folks are starting to 125 00:06:04,920 --> 00:06:09,279 Speaker 1: worry about inflation. For the most part, it's been minimally impactful, 126 00:06:09,360 --> 00:06:11,800 Speaker 1: you know, for so long that most of us hardly 127 00:06:11,800 --> 00:06:14,640 Speaker 1: even remember that it exists. But that's all changed over 128 00:06:14,680 --> 00:06:16,960 Speaker 1: the past year due to a variety of factors. Right. 129 00:06:17,000 --> 00:06:19,039 Speaker 1: First of all, many of us have more cash in 130 00:06:19,040 --> 00:06:22,440 Speaker 1: our bank accounts due to stimulus payments, due to the 131 00:06:22,480 --> 00:06:25,200 Speaker 1: inability to spend our money like we normally would due 132 00:06:25,240 --> 00:06:27,960 Speaker 1: to COVID, so there's a ton of pent up demand. 133 00:06:28,360 --> 00:06:30,880 Speaker 1: And then on the supply side of the equation that 134 00:06:30,960 --> 00:06:33,680 Speaker 1: has also been massively disrupted and companies are having a 135 00:06:33,680 --> 00:06:37,800 Speaker 1: tough time catching up. Pandemic related shutdowns are still impacting 136 00:06:37,800 --> 00:06:40,040 Speaker 1: companies across the world. And so you combine all these 137 00:06:40,040 --> 00:06:43,159 Speaker 1: different factors, UH and inflation. It hasn't been as high 138 00:06:43,160 --> 00:06:45,960 Speaker 1: as it is currently for over thirty years. But the 139 00:06:46,040 --> 00:06:47,719 Speaker 1: question that we want to ask, though, is that should 140 00:06:47,800 --> 00:06:50,280 Speaker 1: we be concerned about it? Because you know, we we 141 00:06:50,320 --> 00:06:52,279 Speaker 1: don't want to read the headlines or watch the news 142 00:06:52,480 --> 00:06:55,159 Speaker 1: and then just react in drastic ways that are gonna 143 00:06:55,240 --> 00:06:58,240 Speaker 1: undermine our finances. Um And it turns out in a 144 00:06:58,240 --> 00:07:00,640 Speaker 1: recent poll we saw that of few well said that 145 00:07:00,680 --> 00:07:04,120 Speaker 1: they are very worried about inflation. And you know, all 146 00:07:04,160 --> 00:07:08,200 Speaker 1: these substantial levels of concern about inflation, they're actually starting 147 00:07:08,200 --> 00:07:11,560 Speaker 1: to concern us, concern you and me. Yeah, we're like, no, 148 00:07:11,800 --> 00:07:14,120 Speaker 1: there's just maybe too much talk about it. It's it's 149 00:07:14,160 --> 00:07:16,520 Speaker 1: gotten overblown, and it just seems like it's one of 150 00:07:16,560 --> 00:07:19,720 Speaker 1: those narratives that's spun out of control where we're all 151 00:07:19,760 --> 00:07:22,840 Speaker 1: talking about inflation and we're all like looking at it constantly. 152 00:07:23,040 --> 00:07:25,600 Speaker 1: We're looking for signs of relief or we're looking to 153 00:07:25,680 --> 00:07:28,840 Speaker 1: numbers to prove how bad it's gotten. Yeah, for political reasons. Yes, 154 00:07:28,880 --> 00:07:31,680 Speaker 1: sometimes it gets hyped up because folks have a different 155 00:07:31,720 --> 00:07:35,200 Speaker 1: agenda exactly. Yeah, And it feels like there's like some 156 00:07:35,240 --> 00:07:39,360 Speaker 1: sort of a psychological shift taking place in our brains collectively, 157 00:07:39,560 --> 00:07:42,560 Speaker 1: because in that same survey, forty percent of folks said 158 00:07:42,600 --> 00:07:45,280 Speaker 1: they plan to reduce their spending on restaurant meals and 159 00:07:45,360 --> 00:07:49,200 Speaker 1: on takeout, said they plan to skip upgrading their personal 160 00:07:49,240 --> 00:07:53,040 Speaker 1: technology devices. Folks said they're going to purchase less clothing 161 00:07:54,040 --> 00:07:57,120 Speaker 1: or delaying or canceling travel plans, and of folks said 162 00:07:57,120 --> 00:07:59,120 Speaker 1: they plan to drive less, a lot of changes. Yeah, 163 00:07:59,120 --> 00:08:00,760 Speaker 1: there's a lot of changes that people are making their 164 00:08:00,800 --> 00:08:04,480 Speaker 1: lives because of inflation. But yeah, holding off on purchases, 165 00:08:04,520 --> 00:08:08,640 Speaker 1: buying fewer things overall, that's a natural reaction to rising prices. 166 00:08:08,680 --> 00:08:11,200 Speaker 1: I get it, and those can be wise financial moves 167 00:08:11,440 --> 00:08:15,720 Speaker 1: no matter what's happening with the inflationary numbers, you know, anecdotally, Matt, 168 00:08:15,760 --> 00:08:17,440 Speaker 1: there was a post in the how to Money Facebook 169 00:08:17,480 --> 00:08:19,240 Speaker 1: group that I think it kind of echoes how a 170 00:08:19,240 --> 00:08:22,560 Speaker 1: lot of people are are feeling right now. A listener said, 171 00:08:22,680 --> 00:08:25,240 Speaker 1: should I be buying more stuff now because of the 172 00:08:25,280 --> 00:08:27,640 Speaker 1: fear that prices are gonna rise in the future. It's like, 173 00:08:27,680 --> 00:08:30,720 Speaker 1: should I should I frontload those things that they're on 174 00:08:30,760 --> 00:08:32,720 Speaker 1: my wish list? I was planning on holding off until 175 00:08:32,840 --> 00:08:36,560 Speaker 1: next year or till like, yeah, like fall of next year. 176 00:08:36,880 --> 00:08:39,240 Speaker 1: But I'm just worried it's gonna cost more now, so 177 00:08:39,240 --> 00:08:41,040 Speaker 1: should I jump in on that thing? I think that 178 00:08:41,120 --> 00:08:45,200 Speaker 1: question reflects another place that this inflationary environment can push 179 00:08:45,280 --> 00:08:47,920 Speaker 1: us towards. It can push us towards spending more money now, 180 00:08:48,640 --> 00:08:51,040 Speaker 1: even if maybe we don't have that money exactly. Yeah, 181 00:08:51,080 --> 00:08:53,520 Speaker 1: So but before that we talk about how to ensure 182 00:08:53,600 --> 00:08:57,880 Speaker 1: that rising costs inflation prognostications don't make you crazy. I 183 00:08:57,920 --> 00:09:00,839 Speaker 1: think it's really important to remind everyone at inflation is 184 00:09:00,880 --> 00:09:03,520 Speaker 1: just something that is always taking place in the background 185 00:09:03,640 --> 00:09:05,640 Speaker 1: of our economy. You know, most of the time, it's 186 00:09:05,640 --> 00:09:08,160 Speaker 1: it's something that we just don't even notice, you now, 187 00:09:08,200 --> 00:09:10,199 Speaker 1: even though it's still kind of humming along. It's sort 188 00:09:10,200 --> 00:09:12,640 Speaker 1: of like the sound of the like the compressor fan 189 00:09:13,040 --> 00:09:15,160 Speaker 1: on your fridge. Like, just because you get used to 190 00:09:15,240 --> 00:09:17,839 Speaker 1: it doesn't mean that it's not consistently chugging along, or 191 00:09:17,840 --> 00:09:19,640 Speaker 1: at least that it you know, it should be. That's 192 00:09:19,679 --> 00:09:22,640 Speaker 1: how your fridge days cold. And so just because inflation 193 00:09:22,679 --> 00:09:25,079 Speaker 1: isn't typically in the headlines, that doesn't mean that it's 194 00:09:25,200 --> 00:09:27,600 Speaker 1: you know, been sitting at zero up until now. If 195 00:09:27,679 --> 00:09:29,160 Speaker 1: if you look back at the data actually over the 196 00:09:29,240 --> 00:09:32,400 Speaker 1: last thirty years, the average consumer price index is two 197 00:09:32,400 --> 00:09:35,280 Speaker 1: point four percent. Like that is a real rate of inflation. 198 00:09:35,559 --> 00:09:37,440 Speaker 1: And so it's it's just important to keep that in 199 00:09:37,440 --> 00:09:41,200 Speaker 1: mind because they can often get discounted when inflation is 200 00:09:41,320 --> 00:09:44,040 Speaker 1: discussed today. Um, when when you see it in the headlines. 201 00:09:44,160 --> 00:09:46,240 Speaker 1: And I wanted to mention this too, because we're talking 202 00:09:46,240 --> 00:09:48,040 Speaker 1: about inflation right now, so aren't we a part of 203 00:09:48,040 --> 00:09:49,480 Speaker 1: the problem. But I just want to make it clear 204 00:09:49,480 --> 00:09:51,880 Speaker 1: that we've been talking about inflation way before it was cool. 205 00:09:52,040 --> 00:09:55,679 Speaker 1: We've been basically ever since we started talking about investing 206 00:09:55,679 --> 00:09:58,560 Speaker 1: on this show four years ago. Inflation was one of 207 00:09:58,559 --> 00:10:00,880 Speaker 1: the reasons that you should be investing. I will say, 208 00:10:00,920 --> 00:10:03,720 Speaker 1: we are always a part of the problem. Just that's 209 00:10:03,720 --> 00:10:05,760 Speaker 1: just generally how we roll. It's true we we like 210 00:10:05,800 --> 00:10:08,000 Speaker 1: to make trouble. But yes, I agree we we have 211 00:10:08,040 --> 00:10:09,760 Speaker 1: been talking about inflation every time we have to talk 212 00:10:09,800 --> 00:10:12,600 Speaker 1: about risk when it comes to investing, Inflation is the 213 00:10:12,640 --> 00:10:14,480 Speaker 1: thing that pops up, because that is the thing in 214 00:10:14,520 --> 00:10:17,439 Speaker 1: the background continually eating at your money if you don't 215 00:10:17,440 --> 00:10:21,160 Speaker 1: take the necessary risk of investing. There's a known quantity 216 00:10:21,200 --> 00:10:23,520 Speaker 1: of risk, and that is inflation. So it's important, the 217 00:10:23,559 --> 00:10:25,880 Speaker 1: sure and steady risk exactly. It comes up in every 218 00:10:25,880 --> 00:10:29,880 Speaker 1: conversation that we have about investing. It seems like in appropriately. 219 00:10:29,920 --> 00:10:32,679 Speaker 1: So so yeah, we're not trying to be fearmongers here 220 00:10:32,800 --> 00:10:34,520 Speaker 1: when it comes to inflation. I think, in fact, we're 221 00:10:34,520 --> 00:10:37,360 Speaker 1: trying to do the opposite with this conversation, and maybe 222 00:10:37,520 --> 00:10:40,240 Speaker 1: trying to tamp down the fears the people that people 223 00:10:40,280 --> 00:10:42,640 Speaker 1: have and and hopefully we'll all become a little less 224 00:10:42,640 --> 00:10:44,800 Speaker 1: crazy when it comes to how we think about inflation 225 00:10:44,840 --> 00:10:46,520 Speaker 1: and how we react to it. I think it's also 226 00:10:46,600 --> 00:10:49,960 Speaker 1: important to note that age likely plays a factor in 227 00:10:50,000 --> 00:10:53,640 Speaker 1: how you perceive inflation, because, yeah, even though inflation has 228 00:10:53,679 --> 00:10:56,520 Speaker 1: been like you said, Matt Humming in the background, it's 229 00:10:56,520 --> 00:11:00,800 Speaker 1: still significantly higher than what our generation has ever experience. Right, 230 00:11:00,840 --> 00:11:04,319 Speaker 1: Let's say you graduated from high school or college ten 231 00:11:04,360 --> 00:11:07,920 Speaker 1: years ago, and only then did you start paying attention 232 00:11:07,960 --> 00:11:11,280 Speaker 1: to prices, really, uh, except for maybe prices right with 233 00:11:11,320 --> 00:11:14,360 Speaker 1: your grandma on like a Tuesday afternoon when you were 234 00:11:14,360 --> 00:11:17,440 Speaker 1: out of school, Well, you only experienced inflation that was 235 00:11:17,520 --> 00:11:20,679 Speaker 1: an average of one point seven percent. So those prices 236 00:11:20,679 --> 00:11:23,440 Speaker 1: were taking up just incredibly slowly. And so many of 237 00:11:23,520 --> 00:11:26,720 Speaker 1: us have never experienced inflation like we're currently seeing it, 238 00:11:27,520 --> 00:11:30,320 Speaker 1: but our parents have. Right back in the seventies and eighties, 239 00:11:30,320 --> 00:11:33,439 Speaker 1: the average inflation rate was over six percent, kind of 240 00:11:33,480 --> 00:11:35,680 Speaker 1: similar to where we're at now. And so yeah, if 241 00:11:35,720 --> 00:11:37,679 Speaker 1: you wanted a mortgage back then, you were looking at 242 00:11:37,679 --> 00:11:40,320 Speaker 1: a thirty year fixed rates that were bumping up close 243 00:11:40,320 --> 00:11:43,240 Speaker 1: to eight per cent. So we just like live in 244 00:11:43,320 --> 00:11:46,280 Speaker 1: different financial times, and I do think age provides some 245 00:11:46,320 --> 00:11:49,320 Speaker 1: proper perspective, or at least knowing your history can provide 246 00:11:49,360 --> 00:11:54,000 Speaker 1: some proper perspective into that reality that inflation is always 247 00:11:54,040 --> 00:11:57,000 Speaker 1: at play in some form or fashion. Uh and that 248 00:11:57,120 --> 00:12:00,320 Speaker 1: rate of inflation just changes over time depending on other 249 00:12:00,400 --> 00:12:03,440 Speaker 1: circumstances happening in the economy and in the world. That's true, man, 250 00:12:03,520 --> 00:12:04,960 Speaker 1: I think it's in what you said to just what 251 00:12:05,000 --> 00:12:07,720 Speaker 1: we've experienced over the past decade is something that we 252 00:12:07,760 --> 00:12:10,160 Speaker 1: can't underestimate. Right. For a lot of us, we've never 253 00:12:10,200 --> 00:12:14,600 Speaker 1: experienced a bear market, We've never experienced rates of inflation 254 00:12:14,880 --> 00:12:16,360 Speaker 1: that have been this high. Like a lot of folks 255 00:12:16,440 --> 00:12:20,200 Speaker 1: came into their professional careers seeing a negative inflation rate. 256 00:12:20,320 --> 00:12:22,559 Speaker 1: And so it's really important to keep in mind our 257 00:12:22,600 --> 00:12:26,199 Speaker 1: own lived experiences and how that impacts how we interpret 258 00:12:26,200 --> 00:12:29,120 Speaker 1: the news and the headlines in our world. Yeah, exactly, 259 00:12:29,160 --> 00:12:32,160 Speaker 1: Like I became an investor in two thousand seven, and 260 00:12:32,400 --> 00:12:35,880 Speaker 1: uh so, you know kind of I certainly was an 261 00:12:35,880 --> 00:12:39,120 Speaker 1: investor while the market was having a moment, was having 262 00:12:39,440 --> 00:12:41,800 Speaker 1: you know, while we were going through a recession. But 263 00:12:42,200 --> 00:12:44,440 Speaker 1: I didn't have like a lump sum that took a 264 00:12:44,440 --> 00:12:46,280 Speaker 1: big hit, and so it didn't impact me in the 265 00:12:46,320 --> 00:12:49,199 Speaker 1: same way, uh that as it would have someone who 266 00:12:49,280 --> 00:12:51,600 Speaker 1: was twenty years older than me and had been investing 267 00:12:51,840 --> 00:12:54,280 Speaker 1: a whole lot longer. And speaking of just kind of 268 00:12:54,320 --> 00:12:57,240 Speaker 1: like your personal situation and how that impacts things, Matt, 269 00:12:57,280 --> 00:13:01,200 Speaker 1: there's actually a way too personally calculate eight the inflation 270 00:13:01,240 --> 00:13:02,839 Speaker 1: that you as an individual or seeing. We're going to 271 00:13:02,920 --> 00:13:05,679 Speaker 1: talk about that and getting to more about how you 272 00:13:05,679 --> 00:13:08,480 Speaker 1: should be reacting to what's happening when it comes to inflation. 273 00:13:08,760 --> 00:13:20,160 Speaker 1: Right after this, all right, we are back from the break. 274 00:13:20,200 --> 00:13:24,400 Speaker 1: We're talking about inflation, and it's true, prices are actually rising. 275 00:13:24,640 --> 00:13:27,400 Speaker 1: You know, we're seeing prices go up at the grocery store. 276 00:13:27,280 --> 00:13:30,400 Speaker 1: We're seeing at the gas pump at Kroger specifically, their 277 00:13:30,400 --> 00:13:34,560 Speaker 1: prices are really high, at least at the gas pump. Yeah. Uh, 278 00:13:35,000 --> 00:13:37,120 Speaker 1: Like houses and cars, like they are way more expensive 279 00:13:37,160 --> 00:13:39,040 Speaker 1: than they were just a year ago. And so across 280 00:13:39,080 --> 00:13:41,439 Speaker 1: the board we're seeing higher prices. But keep in mind 281 00:13:41,800 --> 00:13:44,320 Speaker 1: that that's just simply how inflation works, right, Like, this 282 00:13:44,400 --> 00:13:47,040 Speaker 1: is a part of progress and innovation, This is a 283 00:13:47,040 --> 00:13:49,400 Speaker 1: part of the growth of our economy. Uh, it would 284 00:13:49,400 --> 00:13:52,480 Speaker 1: actually be a bad sign if we saw prices dropping 285 00:13:52,679 --> 00:13:55,800 Speaker 1: and we were entering into a deflationary environment. That's actually 286 00:13:55,800 --> 00:13:57,920 Speaker 1: what we saw back in two thousand nine, Jewel, you 287 00:13:57,960 --> 00:13:59,719 Speaker 1: mentioned that right before the break, how we saw the 288 00:13:59,760 --> 00:14:04,160 Speaker 1: market tank than but we saw a deflationary environment. In 289 00:14:04,200 --> 00:14:06,800 Speaker 1: two thousand and nine, inflation was actually at negative point 290 00:14:06,880 --> 00:14:10,240 Speaker 1: four percent. Uh. And you probably don't need a reminder 291 00:14:10,559 --> 00:14:12,679 Speaker 1: how difficult it was to land a good job back then. 292 00:14:13,080 --> 00:14:16,120 Speaker 1: But the big question right now, though, is is inflation 293 00:14:16,320 --> 00:14:18,080 Speaker 1: something that you should be paying attention to? You know, 294 00:14:18,120 --> 00:14:21,280 Speaker 1: how concerned should you be? Uh? And like you said, 295 00:14:21,280 --> 00:14:25,040 Speaker 1: so much of this comes down to what exactly you 296 00:14:25,120 --> 00:14:27,600 Speaker 1: are buying, what you're spending your money on. That's right, 297 00:14:27,600 --> 00:14:29,880 Speaker 1: that's right. And yeah, we're seeing the headline number, the 298 00:14:30,480 --> 00:14:34,600 Speaker 1: actual percentage rate that is getting up in the high 299 00:14:34,680 --> 00:14:37,560 Speaker 1: single digits of where inflation is at right now, but 300 00:14:38,040 --> 00:14:41,280 Speaker 1: the overall rate of inflation. While it's it's good to know, 301 00:14:41,680 --> 00:14:44,520 Speaker 1: drilling down to see how inflation is actually impacting you 302 00:14:44,680 --> 00:14:47,320 Speaker 1: and your family is even more helpful, like seeing what 303 00:14:47,360 --> 00:14:49,640 Speaker 1: inflation is doing at a personal level. And obviously, if 304 00:14:49,680 --> 00:14:51,720 Speaker 1: you're a good budger, if you track your expense as well. 305 00:14:51,920 --> 00:14:55,040 Speaker 1: You can probably run the numbers like Matt, with how 306 00:14:55,120 --> 00:14:58,080 Speaker 1: much data you have about your own household spending. I'm 307 00:14:58,120 --> 00:15:00,480 Speaker 1: sure you could figure out that compared to last year, 308 00:15:00,520 --> 00:15:03,520 Speaker 1: exactly how much inflation is impact your finances. You can 309 00:15:03,520 --> 00:15:07,560 Speaker 1: probase you in like twenty minutes, right, that's true. Literally, well, 310 00:15:07,680 --> 00:15:10,080 Speaker 1: we were talking about something the other day and it 311 00:15:10,160 --> 00:15:12,800 Speaker 1: was something from like two thousand and eight, and I 312 00:15:12,840 --> 00:15:14,960 Speaker 1: was able to literally tell you how much I spent 313 00:15:15,040 --> 00:15:16,880 Speaker 1: on something because I was just like, well, let me 314 00:15:16,920 --> 00:15:21,920 Speaker 1: pull up the eight budget dot xls excel file and 315 00:15:21,960 --> 00:15:23,200 Speaker 1: I was able to nerd out and let you know 316 00:15:23,200 --> 00:15:26,640 Speaker 1: my numbers. It's quite impressive. Also, um, yeah, there's also 317 00:15:26,720 --> 00:15:30,720 Speaker 1: my dedication. Also, I need help just beyond the professional help. Yes, 318 00:15:31,160 --> 00:15:33,720 Speaker 1: but yeah. Interestingly enough, the Wall Street Journal has this 319 00:15:33,800 --> 00:15:37,000 Speaker 1: like inflation calculator that will link to, which can be 320 00:15:37,040 --> 00:15:39,600 Speaker 1: helpful if you don't have the numbers, the raw data 321 00:15:39,680 --> 00:15:41,600 Speaker 1: that Matt has, but you want to see how much 322 00:15:41,600 --> 00:15:44,080 Speaker 1: inflation is actually impacting you based on how you spend. 323 00:15:44,120 --> 00:15:45,960 Speaker 1: You can kind of plug some numbers in there. We'll 324 00:15:45,960 --> 00:15:48,560 Speaker 1: put that in our show notes. For instance, like if 325 00:15:48,560 --> 00:15:50,840 Speaker 1: you only have one car in that car is an 326 00:15:50,840 --> 00:15:53,720 Speaker 1: electric vehicle. Right. The fact that the massive run up 327 00:15:53,760 --> 00:15:57,120 Speaker 1: in fuel prices is a huge component in the overall 328 00:15:57,200 --> 00:16:00,120 Speaker 1: rate of inflation, well, that's not affecting you, So your 329 00:16:00,120 --> 00:16:02,720 Speaker 1: personal rate of inflation is going to be far lower. Also, 330 00:16:02,920 --> 00:16:04,680 Speaker 1: you know the run up in car prices, We've talked 331 00:16:04,720 --> 00:16:06,960 Speaker 1: about that on the show, Well, it's made up a 332 00:16:07,000 --> 00:16:10,680 Speaker 1: huge aspect of the increased inflation exactly. And if you 333 00:16:10,760 --> 00:16:13,280 Speaker 1: are like content with the one eight year old car 334 00:16:13,400 --> 00:16:15,560 Speaker 1: that you have or whatever, like you're not looking to 335 00:16:15,600 --> 00:16:18,320 Speaker 1: buy a new car, well, inflation is impacting you in 336 00:16:18,400 --> 00:16:20,680 Speaker 1: a much more minimal way. And so yeah, if you 337 00:16:20,760 --> 00:16:22,840 Speaker 1: really want to nerd out, you can check out the 338 00:16:22,920 --> 00:16:25,760 Speaker 1: Bureau of Labor Statistics CPI report, which will link to 339 00:16:25,760 --> 00:16:27,800 Speaker 1: in the show notes, which goes into a great deal, 340 00:16:27,920 --> 00:16:30,520 Speaker 1: almost as much detail as Matt's two thousand eight budget. 341 00:16:30,760 --> 00:16:34,000 Speaker 1: But I look at those reports and not totally heard out. 342 00:16:34,880 --> 00:16:37,480 Speaker 1: So yeah, it's it's it's interesting stuff. But it's also 343 00:16:37,480 --> 00:16:40,240 Speaker 1: important to note that those overall headline numbers are not 344 00:16:40,360 --> 00:16:43,240 Speaker 1: the necessarily the rate of inflation you are paying, and 345 00:16:43,720 --> 00:16:46,400 Speaker 1: your rate of inflation could be half of what you're 346 00:16:46,400 --> 00:16:48,720 Speaker 1: seeing as a headline number, or or maybe less, and 347 00:16:48,760 --> 00:16:51,240 Speaker 1: so kind of figuring out what it's looking like and 348 00:16:51,320 --> 00:16:54,440 Speaker 1: where it's actually impacting you is helpful. Yes, we share 349 00:16:54,480 --> 00:16:56,800 Speaker 1: all that to help you to realize how big or 350 00:16:56,840 --> 00:16:58,400 Speaker 1: how little of a deal this is going to have 351 00:16:58,440 --> 00:17:01,160 Speaker 1: on your finances. Uh. And dude, that's another whole side 352 00:17:01,160 --> 00:17:04,440 Speaker 1: of this too, is the fact that this is uh 353 00:17:04,520 --> 00:17:07,200 Speaker 1: an increase in prices, right, And so that means if 354 00:17:07,240 --> 00:17:08,920 Speaker 1: you are spending your money, like, there's a whole side 355 00:17:08,920 --> 00:17:11,199 Speaker 1: of our finances that don't have to do with spending. 356 00:17:11,359 --> 00:17:14,120 Speaker 1: And hopefully we see that decrease over time as we 357 00:17:14,240 --> 00:17:17,000 Speaker 1: tend to earn more money over our lifetimes, we'll see 358 00:17:17,080 --> 00:17:19,800 Speaker 1: the percentage of money that is going towards expenses. We'll 359 00:17:19,800 --> 00:17:22,760 Speaker 1: see that decrease as we increase our savings rate. Right, 360 00:17:23,040 --> 00:17:25,439 Speaker 1: But okay, let's talk about what to do. How you 361 00:17:25,480 --> 00:17:28,720 Speaker 1: can go about not freaking out about inflation because you 362 00:17:28,760 --> 00:17:30,760 Speaker 1: know the headlines they're not going to stop. And inflation 363 00:17:30,760 --> 00:17:33,680 Speaker 1: itself could be a more meaningful part of our lives, 364 00:17:33,720 --> 00:17:35,960 Speaker 1: and it's been over the past couple of decades. But 365 00:17:36,000 --> 00:17:38,760 Speaker 1: that doesn't mean that we have to yo yo back 366 00:17:38,800 --> 00:17:42,440 Speaker 1: and forth with every piece of inflation information that comes 367 00:17:42,440 --> 00:17:44,760 Speaker 1: our way. And so some of it starts with how 368 00:17:44,840 --> 00:17:47,720 Speaker 1: we consume news. This is uh one of these areas 369 00:17:47,720 --> 00:17:50,280 Speaker 1: where we feel that less can be more, especially if 370 00:17:50,280 --> 00:17:52,800 Speaker 1: your tendency is to freat more based on your news consumption, 371 00:17:53,400 --> 00:17:55,040 Speaker 1: and you know, along those lines, I think it can 372 00:17:55,080 --> 00:17:58,600 Speaker 1: be helpful if you are aware of some definitions, because yes, 373 00:17:58,680 --> 00:18:01,280 Speaker 1: we are dealing with higher inflation, but we're not talking 374 00:18:01,280 --> 00:18:04,280 Speaker 1: about hyper inflation, which means a rise in prices to 375 00:18:04,320 --> 00:18:07,479 Speaker 1: the tune of one thousand percent annually every single year here. 376 00:18:07,600 --> 00:18:10,359 Speaker 1: You know, we talked about that after Jack Dorsey tweet 377 00:18:10,359 --> 00:18:12,200 Speaker 1: a couple of months ago, the former CEO of Twitter, 378 00:18:12,200 --> 00:18:14,240 Speaker 1: And maybe that's why he stepped down, because I realized 379 00:18:14,280 --> 00:18:16,440 Speaker 1: he's like, I was a fool. I shouldn't have said that. 380 00:18:16,440 --> 00:18:18,560 Speaker 1: I can believe that tweet. Um. And you know, we're 381 00:18:18,560 --> 00:18:20,879 Speaker 1: also not dealing with stagflation. I feel like that's the 382 00:18:20,960 --> 00:18:23,879 Speaker 1: term we here thrown around occasionally because that's when you 383 00:18:23,920 --> 00:18:27,639 Speaker 1: see inflation coupled with slow economic growth and high unemployment, 384 00:18:28,000 --> 00:18:31,959 Speaker 1: both of which we've seen rebound significantly since the coronavirus 385 00:18:32,040 --> 00:18:34,880 Speaker 1: hit last spring. UH. So it's helpful to push back 386 00:18:34,920 --> 00:18:38,280 Speaker 1: against the fear of inflation just by knowing you know 387 00:18:38,320 --> 00:18:40,440 Speaker 1: what it is that we're actually living through, just by 388 00:18:40,440 --> 00:18:43,800 Speaker 1: having some definitions and to realize that we're not working 389 00:18:43,800 --> 00:18:47,080 Speaker 1: our way through regular inflation to these more exotic forms 390 00:18:47,080 --> 00:18:49,119 Speaker 1: of inflation or just I don't know, do you just 391 00:18:49,160 --> 00:18:53,760 Speaker 1: say inflation generally speaking as like the the broader concept 392 00:18:53,960 --> 00:18:56,080 Speaker 1: that is not what we're dealing with right now, Yeah, 393 00:18:56,240 --> 00:18:59,240 Speaker 1: for sure. And so yeah, knowing those definitions, knowing what 394 00:18:59,320 --> 00:19:01,399 Speaker 1: exactly we're do link with this is helpful. But there 395 00:19:01,400 --> 00:19:04,600 Speaker 1: are also some practical steps that we can take to 396 00:19:04,600 --> 00:19:08,159 Speaker 1: to fight back against inflation in our own lives and 397 00:19:08,160 --> 00:19:10,040 Speaker 1: and to make sure that it isn't, like we said, 398 00:19:10,280 --> 00:19:13,399 Speaker 1: slowly eroding the value of our money or as is 399 00:19:13,400 --> 00:19:16,160 Speaker 1: happening right now a little more quickly than it has 400 00:19:16,359 --> 00:19:19,320 Speaker 1: in the in the best in the previous a few years. 401 00:19:19,520 --> 00:19:21,640 Speaker 1: But we think it's important to fight fire with fire. 402 00:19:21,720 --> 00:19:24,520 Speaker 1: And then and then that evolves pushing for to make 403 00:19:24,560 --> 00:19:27,639 Speaker 1: more money, uh, pushing for a wage increase. Because of 404 00:19:28,160 --> 00:19:30,240 Speaker 1: the whack of doodle inflation that we're seeing these days, 405 00:19:30,440 --> 00:19:33,440 Speaker 1: it hasn't been easier in a long time to negotiate 406 00:19:33,480 --> 00:19:36,320 Speaker 1: a higher salary or extra perks, Like if you haven't 407 00:19:36,320 --> 00:19:39,720 Speaker 1: gotten a raise in quite some time, it's time for 408 00:19:39,760 --> 00:19:42,760 Speaker 1: you to ask your boss to see, like how much 409 00:19:42,800 --> 00:19:45,639 Speaker 1: more you can make. And if your employer is offering 410 00:19:45,800 --> 00:19:48,160 Speaker 1: a normal raise in that two to three percent range 411 00:19:48,280 --> 00:19:50,639 Speaker 1: that you're used to getting that cost of living adjustment, 412 00:19:50,840 --> 00:19:52,720 Speaker 1: you gotta push for more. That's just not going to 413 00:19:52,800 --> 00:19:54,960 Speaker 1: do it right now. And it's it's important to bring 414 00:19:55,280 --> 00:19:57,879 Speaker 1: your knowledge about inflation and what's happening right now to 415 00:19:58,000 --> 00:20:00,840 Speaker 1: these conversations and to push back and say, do you 416 00:20:00,840 --> 00:20:03,080 Speaker 1: realize that's actually that's not even a raise like that 417 00:20:03,280 --> 00:20:05,520 Speaker 1: you're not even allowing me to keep up with the 418 00:20:05,720 --> 00:20:09,919 Speaker 1: increasing costs of goods and services. And so, yeah, if 419 00:20:09,960 --> 00:20:12,400 Speaker 1: your employer isn't willing to budge on your pay, it's 420 00:20:12,440 --> 00:20:14,639 Speaker 1: time to do some digging in the job market to 421 00:20:14,680 --> 00:20:17,359 Speaker 1: see what sort of pay you can command elsewhere, and 422 00:20:17,440 --> 00:20:21,359 Speaker 1: you can use that as leverage in the negotiation process 423 00:20:21,480 --> 00:20:23,160 Speaker 1: or mosey on down the road to a new job 424 00:20:23,160 --> 00:20:26,320 Speaker 1: where you can get paid a decent chunk more. But yeah, 425 00:20:26,359 --> 00:20:28,800 Speaker 1: finding to make more money is a huge part of 426 00:20:28,840 --> 00:20:32,280 Speaker 1: how you actually push back against the way inflation is 427 00:20:32,320 --> 00:20:35,480 Speaker 1: impacting you and your own personal finances. That's rights another 428 00:20:35,520 --> 00:20:39,840 Speaker 1: way we can combat inflation is just simply by consuming less, 429 00:20:40,000 --> 00:20:42,000 Speaker 1: you know, remember the stats that we gave back at 430 00:20:42,040 --> 00:20:44,800 Speaker 1: the beginning of the episode. We'll purchasing fewer things overall, 431 00:20:44,880 --> 00:20:47,000 Speaker 1: and finding ways, you know, just to get the items 432 00:20:47,040 --> 00:20:49,760 Speaker 1: that you do need, either for free or for you know, 433 00:20:50,080 --> 00:20:53,119 Speaker 1: or for cheaper is something that we can always get behind, 434 00:20:53,520 --> 00:20:55,600 Speaker 1: but especially now, um, you know, and so that can 435 00:20:55,640 --> 00:20:57,639 Speaker 1: be as simple as just making dinner at home, brewing 436 00:20:57,680 --> 00:21:00,720 Speaker 1: your own coffee. Those are legitimate helpful ways to make 437 00:21:00,760 --> 00:21:03,520 Speaker 1: inflation hurt your bottom line in a smaller way. By 438 00:21:03,520 --> 00:21:05,760 Speaker 1: nothing groups. They are in an excellent place to find 439 00:21:05,840 --> 00:21:09,399 Speaker 1: things that you want that don't cost a time. Uh Facebook, Marketplace, eBay. 440 00:21:09,440 --> 00:21:12,119 Speaker 1: These are all great for buying used. Depending on the item, 441 00:21:12,200 --> 00:21:15,840 Speaker 1: we may not see inflation having as large of an 442 00:21:15,920 --> 00:21:18,119 Speaker 1: impact on the used marketplace, and so that's just an 443 00:21:18,119 --> 00:21:21,480 Speaker 1: effective way to stretch your dollar even more. Yeah, the 444 00:21:21,520 --> 00:21:25,000 Speaker 1: market for local goods in your community via sites like 445 00:21:25,000 --> 00:21:29,000 Speaker 1: Craigslist or Facebook, marketplace, you're going to in all likelihood, well, one, 446 00:21:29,080 --> 00:21:31,400 Speaker 1: you're just gonna save money buying used, right, Like, that's 447 00:21:31,440 --> 00:21:33,520 Speaker 1: one way to save money. But then on top of that, 448 00:21:33,800 --> 00:21:37,040 Speaker 1: you might see uh more imperfections in that market, and 449 00:21:37,040 --> 00:21:40,000 Speaker 1: so you might see someone selling an old couch or 450 00:21:40,040 --> 00:21:42,399 Speaker 1: something that depending on the age and the wear and 451 00:21:42,440 --> 00:21:44,080 Speaker 1: tear in the location and how you pick it up, 452 00:21:44,280 --> 00:21:47,439 Speaker 1: they're they're not charging as much as they potentially could be. 453 00:21:47,880 --> 00:21:50,000 Speaker 1: And so yeah, I think there there's just there are 454 00:21:50,040 --> 00:21:52,560 Speaker 1: more ways for you to save and to combat inflation 455 00:21:52,640 --> 00:21:54,520 Speaker 1: by buying used and by sticking to some of those 456 00:21:54,520 --> 00:21:56,640 Speaker 1: sites to buy more of the things that you might 457 00:21:56,720 --> 00:21:59,840 Speaker 1: have opted to buy new totally on your favorite internet 458 00:21:59,840 --> 00:22:02,199 Speaker 1: web site swap a offer up, like, there's all these 459 00:22:02,240 --> 00:22:03,960 Speaker 1: other apps as well that I mean, honestly, like you 460 00:22:03,960 --> 00:22:05,639 Speaker 1: and I, we don't use all that often because we're 461 00:22:05,680 --> 00:22:07,919 Speaker 1: trying to minimize what we're purchasing all together. But there 462 00:22:07,920 --> 00:22:10,320 Speaker 1: are a lot of different options out there for folks, yes, exactly, 463 00:22:10,320 --> 00:22:12,760 Speaker 1: And so yeah, another question Matt that comes up for 464 00:22:12,760 --> 00:22:16,800 Speaker 1: people is about stockpiling, like buying and consuming less stuff. 465 00:22:16,840 --> 00:22:19,520 Speaker 1: That's one way to decrease the impact of inflation, But 466 00:22:19,600 --> 00:22:22,240 Speaker 1: what about the opposite, what about what's known as kind 467 00:22:22,240 --> 00:22:25,560 Speaker 1: of pulling demand forward and so buying things that you 468 00:22:25,600 --> 00:22:28,720 Speaker 1: were attempting to hold off on, uh and saying you 469 00:22:28,760 --> 00:22:31,880 Speaker 1: know what, because of the fear I have about inflation, 470 00:22:31,920 --> 00:22:34,199 Speaker 1: because of the fact that this item is in all 471 00:22:34,240 --> 00:22:38,000 Speaker 1: likelihood going to cost more next month, or at least 472 00:22:38,119 --> 00:22:40,760 Speaker 1: that's my brain's assumption because I'm seeing all these headlines 473 00:22:40,760 --> 00:22:44,120 Speaker 1: about inflation. Should I buy that item now? And that's actually, 474 00:22:44,160 --> 00:22:45,920 Speaker 1: you know, when I refer to that listener on Facebook, 475 00:22:45,920 --> 00:22:48,240 Speaker 1: that's that's really what she was asking about. Does it 476 00:22:48,320 --> 00:22:51,200 Speaker 1: make sense to purchase something now assuming that the price 477 00:22:51,280 --> 00:22:53,119 Speaker 1: is going to go up? And I think the answer 478 00:22:53,119 --> 00:22:55,240 Speaker 1: to that depends on you know, what the item is, 479 00:22:55,480 --> 00:22:57,760 Speaker 1: whether or not you can afford it is a huge 480 00:22:58,160 --> 00:22:59,919 Speaker 1: is a huge piece of that. You know, don't go 481 00:23:00,000 --> 00:23:02,840 Speaker 1: into debt in order to secure a small purchase or 482 00:23:02,920 --> 00:23:06,240 Speaker 1: a medium sized purchase, because then you're paying interest on 483 00:23:06,240 --> 00:23:09,000 Speaker 1: that item, and that defeats the purpose of saving money 484 00:23:09,000 --> 00:23:11,159 Speaker 1: on the item. We can pretty much guarantee that the 485 00:23:11,160 --> 00:23:13,240 Speaker 1: interest that you're gonna pay on an item paying for 486 00:23:13,280 --> 00:23:15,199 Speaker 1: it with credit is going to be much higher than 487 00:23:15,240 --> 00:23:17,719 Speaker 1: the rate of inflation over the next year. Yeah. But 488 00:23:17,720 --> 00:23:20,080 Speaker 1: but if you have the cash and you're just accelerating 489 00:23:20,080 --> 00:23:23,280 Speaker 1: a bigger purchase because you want to ensure that you 490 00:23:23,359 --> 00:23:25,520 Speaker 1: lock in the price that it's at and you don't 491 00:23:25,520 --> 00:23:27,360 Speaker 1: want to pay more down the road, that's not a 492 00:23:27,480 --> 00:23:29,679 Speaker 1: terrible idea. We would just say, just don't let the 493 00:23:29,720 --> 00:23:33,320 Speaker 1: current inflation reality and then you know, future inflation concerns 494 00:23:33,359 --> 00:23:35,560 Speaker 1: get you too jumpy because that kind of leads to 495 00:23:35,880 --> 00:23:38,640 Speaker 1: a cycle for for all of us. If we're buying more, 496 00:23:38,720 --> 00:23:41,440 Speaker 1: consuming more, Uh, prices are going to go up at 497 00:23:41,480 --> 00:23:45,080 Speaker 1: a faster rate, and that leads to a more inflationary 498 00:23:45,160 --> 00:23:47,840 Speaker 1: environment in general. And it's just not good for your 499 00:23:47,840 --> 00:23:51,520 Speaker 1: personal financial situation to continue to push forward spending to 500 00:23:51,600 --> 00:23:54,560 Speaker 1: buy things sooner than you otherwise would just because of 501 00:23:54,640 --> 00:23:56,840 Speaker 1: inflationary fears. Yeah, it's kind of like options trading. I 502 00:23:56,840 --> 00:23:59,800 Speaker 1: feel like folks who like to stockpile and hoard might 503 00:23:59,840 --> 00:24:02,200 Speaker 1: all to overlap with those who might be interested in that. 504 00:24:02,640 --> 00:24:05,440 Speaker 1: But like, essentially this is kind of like the costco effect, right, 505 00:24:05,800 --> 00:24:07,520 Speaker 1: That is how a lot of folks are able to 506 00:24:07,560 --> 00:24:09,879 Speaker 1: get such a good deal at costco. Oftentimes it is 507 00:24:09,920 --> 00:24:12,440 Speaker 1: the price, but it's because of the quantity. Uh. And if, 508 00:24:12,480 --> 00:24:14,200 Speaker 1: of course, if you have a place to store all 509 00:24:14,240 --> 00:24:16,240 Speaker 1: of those items and you're not going to be tempted 510 00:24:16,280 --> 00:24:18,960 Speaker 1: to over consume those items, then it could be a 511 00:24:18,960 --> 00:24:21,359 Speaker 1: good deal for you. Because I think that's another way 512 00:24:21,359 --> 00:24:23,280 Speaker 1: that we have to be honest with ourselves, is are 513 00:24:23,280 --> 00:24:25,040 Speaker 1: you gonna be wasteful? Right? Like, just because you have 514 00:24:25,119 --> 00:24:27,280 Speaker 1: more of a certain product on hand, you need to 515 00:24:27,320 --> 00:24:29,879 Speaker 1: be honest with yourself. And uh like, are you going 516 00:24:29,920 --> 00:24:32,240 Speaker 1: to be more likely to burn through a bunch of 517 00:24:32,240 --> 00:24:34,840 Speaker 1: paper towels because you've got six rolls of paper towels 518 00:24:34,840 --> 00:24:36,200 Speaker 1: in your cabinet and it's kind of taken up a 519 00:24:36,240 --> 00:24:38,439 Speaker 1: bunch of space. Like it makes me think back to 520 00:24:38,920 --> 00:24:40,639 Speaker 1: I mean even now to a certain extent. I was 521 00:24:40,640 --> 00:24:43,000 Speaker 1: talking about gas at the beginning of the episode. But 522 00:24:43,080 --> 00:24:45,119 Speaker 1: when I'm getting close to the e you know, on 523 00:24:45,359 --> 00:24:47,199 Speaker 1: the on the gas cage, I tend to drive a 524 00:24:47,200 --> 00:24:49,679 Speaker 1: bit more gingerly, Like I I coast more. I I 525 00:24:49,720 --> 00:24:52,080 Speaker 1: don't floor it as often. But Dude, after I fill 526 00:24:52,119 --> 00:24:54,919 Speaker 1: that tank up, I'm like get in places quickly. It's like, 527 00:24:55,200 --> 00:24:57,240 Speaker 1: I think I am not wasting time because I know 528 00:24:57,680 --> 00:24:59,760 Speaker 1: that I've got a full tank. There's something like instinctually 529 00:24:59,800 --> 00:25:01,960 Speaker 1: human and about that when you have more resources, you're 530 00:25:01,960 --> 00:25:04,919 Speaker 1: just you're more wasteful. Exactly, when there's more money in 531 00:25:04,960 --> 00:25:07,520 Speaker 1: your bank account and it's not earmarked for something, you're 532 00:25:07,560 --> 00:25:10,320 Speaker 1: more likely to like say, screw it, I'm gonna buy 533 00:25:10,320 --> 00:25:12,800 Speaker 1: that thing now on a whim, even though you haven't 534 00:25:12,800 --> 00:25:15,720 Speaker 1: planned on it. Yeah, I I completely there's that psychological 535 00:25:15,760 --> 00:25:19,760 Speaker 1: component of having I don't know, excess resources, either in 536 00:25:19,800 --> 00:25:21,960 Speaker 1: your bank account or in your cabinet just depends if 537 00:25:21,960 --> 00:25:24,120 Speaker 1: you're talking about dry goods from costco or just money 538 00:25:24,119 --> 00:25:26,760 Speaker 1: in the bank. But we've got a few other ways 539 00:25:26,800 --> 00:25:29,640 Speaker 1: that we can combat and fight against inflation and its 540 00:25:29,640 --> 00:25:32,520 Speaker 1: impact on our finances. We'll touch on how investing can 541 00:25:32,520 --> 00:25:34,199 Speaker 1: help us to fight inflation. We'll get to all that 542 00:25:34,359 --> 00:25:45,720 Speaker 1: right after this break. All right, we'll back matt Let's 543 00:25:45,760 --> 00:25:48,399 Speaker 1: keep talking about inflation and how it's making us a 544 00:25:48,440 --> 00:25:51,679 Speaker 1: bit uh cuckoo for coco puffs? A bit crazy? Was that? 545 00:25:51,800 --> 00:25:53,879 Speaker 1: Did you uh eat cocoa pus As a kid, my 546 00:25:53,880 --> 00:25:57,159 Speaker 1: parents would rarely buy the name brand cereal? Matthew sentiment 547 00:25:57,200 --> 00:25:59,040 Speaker 1: to crunch for me, man all the way, Give me 548 00:25:59,160 --> 00:26:02,760 Speaker 1: like that one, a sugar cinnamon, like puffed rice whatever. 549 00:26:02,800 --> 00:26:05,560 Speaker 1: I'm still nostalgic for all those cereals like if are 550 00:26:05,680 --> 00:26:07,360 Speaker 1: we we never have them in our house. We never, 551 00:26:07,400 --> 00:26:08,800 Speaker 1: But if someone gave me a box, I would eat 552 00:26:08,840 --> 00:26:10,440 Speaker 1: the mess out of it, that's for sure. Like I 553 00:26:10,480 --> 00:26:12,760 Speaker 1: remember cinnamon to a scrunch back when they were still 554 00:26:12,760 --> 00:26:14,960 Speaker 1: serving it up, not in the plastic bag inside, but 555 00:26:15,000 --> 00:26:16,960 Speaker 1: when it was still like the foil bag. Remember the 556 00:26:17,000 --> 00:26:19,720 Speaker 1: foil bag. It was kind of like sticky around the top. Nice, 557 00:26:20,760 --> 00:26:24,399 Speaker 1: I'm getting old. It's a good throwback, all right. Well, 558 00:26:24,440 --> 00:26:27,280 Speaker 1: let's let's keep talking about inflation and how how to 559 00:26:27,320 --> 00:26:29,280 Speaker 1: come about it. And one of the main ways that 560 00:26:29,320 --> 00:26:30,920 Speaker 1: you can come about inflation in your life is to 561 00:26:31,320 --> 00:26:34,600 Speaker 1: plan and budget better. So yet, not only should you 562 00:26:34,680 --> 00:26:37,280 Speaker 1: consume less like we talked about to reduce the impact 563 00:26:37,320 --> 00:26:39,920 Speaker 1: of inflation, looking to buy used stuff like that, but 564 00:26:39,960 --> 00:26:42,000 Speaker 1: we also want you to pay special attention to your 565 00:26:42,040 --> 00:26:46,280 Speaker 1: budget and make changes accordingly. Like in a normal inflationary cycle, Uh, 566 00:26:46,400 --> 00:26:49,600 Speaker 1: you don't normally have to think as much about changes 567 00:26:49,600 --> 00:26:51,720 Speaker 1: to your budget. There there are small little tweaks you 568 00:26:51,760 --> 00:26:54,120 Speaker 1: can make in order to make sure that you kind 569 00:26:54,119 --> 00:26:57,400 Speaker 1: of make the numbers work. But as the numbers change, 570 00:26:57,680 --> 00:26:59,840 Speaker 1: as your grocery store run, or the amount you spend 571 00:26:59,840 --> 00:27:02,400 Speaker 1: on us every month doesn't stay the same as those 572 00:27:02,400 --> 00:27:05,080 Speaker 1: prices increase, there are some changes that we have to 573 00:27:05,080 --> 00:27:07,520 Speaker 1: make to our habits and to our behaviors in order 574 00:27:07,600 --> 00:27:11,200 Speaker 1: to kind of continue to live within our means. Uh, 575 00:27:11,240 --> 00:27:13,280 Speaker 1: But there's also a truth to there's only so much 576 00:27:13,320 --> 00:27:15,000 Speaker 1: that you can cut back, right, So you're gonna have 577 00:27:15,040 --> 00:27:18,479 Speaker 1: to adjust your budget to reflect the changing reality on 578 00:27:18,520 --> 00:27:21,199 Speaker 1: the ground. Because if you don't make any changes to 579 00:27:21,280 --> 00:27:23,480 Speaker 1: what you're buying and to the amount that you've budget 580 00:27:23,520 --> 00:27:25,920 Speaker 1: every month, if you're not changing things around and reallocating 581 00:27:25,920 --> 00:27:28,919 Speaker 1: your resources, chances that you're gonna go over budget just 582 00:27:28,960 --> 00:27:31,600 Speaker 1: are going up dramatically. That's right, And I mean and obviously, 583 00:27:31,640 --> 00:27:35,119 Speaker 1: like the most important thing about budgeting and tracking or 584 00:27:35,119 --> 00:27:37,880 Speaker 1: spending is to just to be able to have accurate information. Uh. 585 00:27:37,880 --> 00:27:40,600 Speaker 1: And so it's okay if that amount changes, right, Like, 586 00:27:40,760 --> 00:27:42,800 Speaker 1: that's that's not like throwing in the towel and admitting 587 00:27:42,800 --> 00:27:44,720 Speaker 1: defeat or anything like that. But the more accurate those 588 00:27:44,800 --> 00:27:47,800 Speaker 1: numbers are, the more helpful it will be when it 589 00:27:47,840 --> 00:27:50,000 Speaker 1: comes to you achieving some of the different financial goals 590 00:27:50,040 --> 00:27:51,960 Speaker 1: that you set for yourself. And it touches on, you know, 591 00:27:51,960 --> 00:27:53,600 Speaker 1: one of the different strategies that I have when it 592 00:27:53,600 --> 00:27:56,399 Speaker 1: comes to my spending when like we try not to 593 00:27:56,600 --> 00:27:59,919 Speaker 1: adjust how much we spend towards different categories from your 594 00:28:00,040 --> 00:28:04,200 Speaker 1: a year, because, like we said earlier, inflation does take place. 595 00:28:04,240 --> 00:28:06,679 Speaker 1: It is happening in the background, even when it's not 596 00:28:06,840 --> 00:28:09,480 Speaker 1: in the headlines, and if you are able to maintain 597 00:28:09,480 --> 00:28:12,680 Speaker 1: a certain level of spending, you are effectively spending less 598 00:28:13,200 --> 00:28:15,080 Speaker 1: every single year. Uh. And so that's kind of like 599 00:28:15,119 --> 00:28:17,159 Speaker 1: one of those little tricks where it's like, oh, my 600 00:28:17,160 --> 00:28:20,679 Speaker 1: gut's getting bigger, but I'm gonna keep the belts, you know, 601 00:28:20,720 --> 00:28:22,800 Speaker 1: on the same notch. It feels a little bit tight. 602 00:28:22,840 --> 00:28:24,480 Speaker 1: Eventually you get to a point to where you're like, 603 00:28:24,960 --> 00:28:28,520 Speaker 1: all right, this isn't it's either not accurate anymore, or 604 00:28:28,640 --> 00:28:32,399 Speaker 1: it's actually just impossible to actually contain the growth or 605 00:28:32,800 --> 00:28:34,560 Speaker 1: the money that you do want to spend. But again, 606 00:28:34,560 --> 00:28:37,720 Speaker 1: it's often about having accurate information, and when it comes 607 00:28:37,760 --> 00:28:39,840 Speaker 1: to your investment portfolio, you want to make sure that 608 00:28:39,880 --> 00:28:42,040 Speaker 1: you've you know, that you're aware of the impact that 609 00:28:42,120 --> 00:28:45,320 Speaker 1: higher prices uh will have on your nest egg, not 610 00:28:45,400 --> 00:28:47,480 Speaker 1: only on your expenses every month, like we just talked about, 611 00:28:47,480 --> 00:28:50,120 Speaker 1: but also on your retirements. You know, this is an 612 00:28:50,120 --> 00:28:52,520 Speaker 1: instance where it might make sense to be a little 613 00:28:52,520 --> 00:28:56,000 Speaker 1: bit more conservative. You know, this is especially true for retirees. 614 00:28:56,280 --> 00:28:59,400 Speaker 1: There's been the commonly dispensed four percent rule, which basically 615 00:28:59,440 --> 00:29:02,160 Speaker 1: states that retiree they should be able to draw down 616 00:29:02,280 --> 00:29:05,960 Speaker 1: four percent of their portfolio assets every single year. Uh. 617 00:29:06,000 --> 00:29:08,320 Speaker 1: And if they do that, they'll never outlive their money. 618 00:29:08,360 --> 00:29:10,600 Speaker 1: But the smart folks over at morning Star, they actually 619 00:29:10,640 --> 00:29:14,160 Speaker 1: just reassessed and say that it should be more like 620 00:29:14,240 --> 00:29:18,160 Speaker 1: a three point three percent draw down rate. Uh. So, yeah, 621 00:29:18,160 --> 00:29:20,440 Speaker 1: it changed that from point zero four to point zero 622 00:29:20,440 --> 00:29:22,840 Speaker 1: at three three. And that's based on an assumption that 623 00:29:22,960 --> 00:29:25,920 Speaker 1: equities are overvalued right now. Uh, and that bond rates 624 00:29:26,000 --> 00:29:29,120 Speaker 1: will remain low, And so being more conservative is going 625 00:29:29,160 --> 00:29:32,640 Speaker 1: to make sense in an environment like this. Yes, true, Matt. 626 00:29:32,680 --> 00:29:35,440 Speaker 1: But but while we're talking about investing, we would also 627 00:29:35,720 --> 00:29:39,080 Speaker 1: tell folks, tell our listeners, especially the younger ones who 628 00:29:39,120 --> 00:29:42,160 Speaker 1: have decades to grow their wealth, to not make massive 629 00:29:42,240 --> 00:29:46,160 Speaker 1: changes to their investment portfolio because they're worried about inflation. 630 00:29:46,600 --> 00:29:48,240 Speaker 1: Those are other headlines that you and I are seeing. 631 00:29:48,280 --> 00:29:52,000 Speaker 1: It's like how to inflation proof your portfolio. And we've 632 00:29:52,080 --> 00:29:54,560 Speaker 1: talked about this before. We did an episode about inflation. 633 00:29:54,720 --> 00:29:57,080 Speaker 1: I don't know, was it like eight ten months ago, 634 00:29:57,480 --> 00:30:00,800 Speaker 1: and we we talked about how stop are one of 635 00:30:00,840 --> 00:30:03,360 Speaker 1: the best places to put your money no matter the 636 00:30:03,400 --> 00:30:07,080 Speaker 1: inflationary environment, and a widely diversified portfolio made up of 637 00:30:07,080 --> 00:30:10,000 Speaker 1: mostly equities continues to be an excellent way to invest 638 00:30:10,040 --> 00:30:12,520 Speaker 1: your money even in this environment. So we would say 639 00:30:12,640 --> 00:30:15,800 Speaker 1: keep investing in the market each and every month, preferably 640 00:30:15,840 --> 00:30:19,280 Speaker 1: in those diversified index funds. And uh, Yeah, as we've seen, 641 00:30:19,760 --> 00:30:23,600 Speaker 1: this inflationary period has actually created more profitability for a 642 00:30:23,640 --> 00:30:25,920 Speaker 1: whole lot of companies. And so if you own a 643 00:30:26,000 --> 00:30:28,600 Speaker 1: small piece of the hundreds or thousands of companies in 644 00:30:28,800 --> 00:30:32,600 Speaker 1: that index fund, you stand to benefit. You're going to 645 00:30:32,640 --> 00:30:36,440 Speaker 1: see the amount in that retirement accounts continue to go up. 646 00:30:36,800 --> 00:30:39,760 Speaker 1: And so yeah, generally speaking, investing your money is the 647 00:30:39,840 --> 00:30:43,360 Speaker 1: most straightforward way to hedge against inflation. The more you 648 00:30:43,400 --> 00:30:45,920 Speaker 1: have in savings just sitting there in an account that's 649 00:30:45,960 --> 00:30:48,480 Speaker 1: getting eroded away, but the money that you have and 650 00:30:48,600 --> 00:30:52,720 Speaker 1: investments over time is going to healthily combat what's happening 651 00:30:52,840 --> 00:30:54,640 Speaker 1: with inflation. Yeah, you definitely don't want to have too 652 00:30:54,680 --> 00:30:57,840 Speaker 1: much money in your savings. Like obviously we like saving money, 653 00:30:57,880 --> 00:31:01,240 Speaker 1: but hoarding you know, just massive amounts, Uh, within an 654 00:31:01,240 --> 00:31:04,280 Speaker 1: inflationary environment like this means that your dollars are losing 655 00:31:04,640 --> 00:31:07,760 Speaker 1: their spending power more rapidly. You've got to be an 656 00:31:07,760 --> 00:31:11,120 Speaker 1: investor always, but especially now, don't put that emergency fund 657 00:31:11,400 --> 00:31:14,320 Speaker 1: money at risk in the market. But at the same time, 658 00:31:14,520 --> 00:31:17,200 Speaker 1: don't get too conservative and have just massive amounts of 659 00:31:17,240 --> 00:31:19,480 Speaker 1: money in your savings account. You want to put your 660 00:31:19,600 --> 00:31:21,840 Speaker 1: money that you don't need set aside in that emergency 661 00:31:21,840 --> 00:31:24,600 Speaker 1: fund to work, and you know, making small moves like 662 00:31:24,640 --> 00:31:27,120 Speaker 1: opting just to put some of your discretionary savings and 663 00:31:27,240 --> 00:31:29,880 Speaker 1: I bonds that can be a helpful inflation hedge. But 664 00:31:29,960 --> 00:31:32,880 Speaker 1: you don't want to make just these huge, massive overhauls 665 00:31:32,920 --> 00:31:36,200 Speaker 1: to your portfolio in an attempt to correct for those 666 00:31:36,280 --> 00:31:39,240 Speaker 1: higher inflation numbers. Yeah, it's tempting that, I think for 667 00:31:39,280 --> 00:31:43,000 Speaker 1: people to uh see us, to see one thing happening 668 00:31:43,200 --> 00:31:47,760 Speaker 1: and then to instinctively knee jerk make a reaction to 669 00:31:48,000 --> 00:31:51,480 Speaker 1: counterbalance what's happening in one space. And when inflation feels 670 00:31:51,480 --> 00:31:53,360 Speaker 1: out of control, you feel like you need to get 671 00:31:53,400 --> 00:31:56,360 Speaker 1: in control and and make a different move. But really, 672 00:31:56,400 --> 00:32:00,239 Speaker 1: the traditional way we've talked about investing uh it whole. Yes, 673 00:32:00,320 --> 00:32:03,160 Speaker 1: it remains true whether you're in a one and a 674 00:32:03,200 --> 00:32:06,560 Speaker 1: half percent inflationary environment or an eight percent inflationary environment, 675 00:32:06,800 --> 00:32:09,200 Speaker 1: it's still a great way to continue to invest your 676 00:32:09,200 --> 00:32:11,920 Speaker 1: money to continue to dollar cost average every two weeks 677 00:32:11,960 --> 00:32:14,600 Speaker 1: with your paycheck, or or just sticking to your investing 678 00:32:14,600 --> 00:32:18,000 Speaker 1: plan in general, investing as frequently as you like to do. Yeah, 679 00:32:18,000 --> 00:32:19,400 Speaker 1: I mean going back to your you know what you 680 00:32:19,400 --> 00:32:21,440 Speaker 1: said about your friend that had prostate cancer. It kind 681 00:32:21,440 --> 00:32:23,600 Speaker 1: of goes back to that. There's this mentality of feeling 682 00:32:23,680 --> 00:32:25,239 Speaker 1: like we got a mess with stuff. As as soon 683 00:32:25,240 --> 00:32:27,959 Speaker 1: as you hear something new or you hear something scary 684 00:32:28,240 --> 00:32:31,560 Speaker 1: like a cancer diagnosis, you think, okay, let's blast it. 685 00:32:31,880 --> 00:32:34,080 Speaker 1: But in reality that you know in his case that 686 00:32:34,160 --> 00:32:36,440 Speaker 1: wasn't what he needed to do, and in our case 687 00:32:36,800 --> 00:32:38,840 Speaker 1: when it comes to investing, and for a lot of people, 688 00:32:39,080 --> 00:32:40,600 Speaker 1: you don't need to do anything differently. You just keep 689 00:32:40,680 --> 00:32:43,280 Speaker 1: doing what you've been doing and ignore the headlines. Yeah, 690 00:32:43,320 --> 00:32:46,000 Speaker 1: it feels like it's action time, but in reality it's 691 00:32:46,000 --> 00:32:48,320 Speaker 1: time to like, I don't keep on doing what you've 692 00:32:48,320 --> 00:32:51,000 Speaker 1: been doing and take very little action. And let's talk 693 00:32:51,000 --> 00:32:52,760 Speaker 1: about debt to Matt, because that's that's a question that 694 00:32:52,800 --> 00:32:55,440 Speaker 1: comes up when people are hearing what's happening with inflation. 695 00:32:56,120 --> 00:32:58,640 Speaker 1: Should it change the way I'm like tackling or paying 696 00:32:58,680 --> 00:33:03,360 Speaker 1: off my debt? Well, that depends but in some ways. 697 00:33:03,400 --> 00:33:06,160 Speaker 1: Actually yes, with low interest right debt? Right, have you 698 00:33:06,200 --> 00:33:08,520 Speaker 1: been paying off the loan on your house more quickly, 699 00:33:08,560 --> 00:33:10,800 Speaker 1: maybe hoping to pay it off in twenty years instead 700 00:33:10,920 --> 00:33:13,880 Speaker 1: of thirty years. Well, if you're fixed, mortgage rate is 701 00:33:13,960 --> 00:33:16,920 Speaker 1: low in the three percent range. Uh, and it should 702 00:33:16,920 --> 00:33:19,320 Speaker 1: be after the rates we've been experiencing. If you haven't 703 00:33:19,320 --> 00:33:21,920 Speaker 1: really financed in the last three years, you probably should 704 00:33:22,200 --> 00:33:25,360 Speaker 1: that would do it. Yes, but yeah, no, No. Debt obviously, 705 00:33:25,400 --> 00:33:28,920 Speaker 1: according to Matt and I is spectacularly awesome. Some debts 706 00:33:28,960 --> 00:33:32,240 Speaker 1: are better than others. But we don't really love any 707 00:33:32,280 --> 00:33:34,840 Speaker 1: of them. We don't. We just dislike some less, but 708 00:33:35,000 --> 00:33:38,200 Speaker 1: some that it just really is less egregious. Some of 709 00:33:38,240 --> 00:33:41,440 Speaker 1: it even borders on smarts. And your home mortgage is 710 00:33:41,480 --> 00:33:43,640 Speaker 1: one of those debts that we think should be a 711 00:33:43,720 --> 00:33:47,080 Speaker 1: low priority for you to pay off, especially with what's 712 00:33:47,080 --> 00:33:50,040 Speaker 1: currently happening right now. Right, just don't start spending the 713 00:33:50,080 --> 00:33:52,560 Speaker 1: money that you're putting towards the principle in order to 714 00:33:52,600 --> 00:33:57,120 Speaker 1: pay down that mortgage. Quicker we would say invested instead. So, yeah, 715 00:33:57,160 --> 00:33:59,440 Speaker 1: debt paid down is still something that you should prioritize, 716 00:33:59,520 --> 00:34:01,600 Speaker 1: especially if it's credit card debt or if it's high 717 00:34:01,600 --> 00:34:04,000 Speaker 1: interest rate debt, it's still is something we want you 718 00:34:04,040 --> 00:34:06,240 Speaker 1: to get rid of as quickly as possible. But if 719 00:34:06,280 --> 00:34:09,839 Speaker 1: you were, let's say, prioritizing pay down of a debt 720 00:34:09,840 --> 00:34:12,880 Speaker 1: that's got an astronomically low interest rate, well, in this 721 00:34:12,960 --> 00:34:16,360 Speaker 1: current inflationary environment, it makes less and less sense to 722 00:34:16,480 --> 00:34:18,200 Speaker 1: be paying down debt with that money, and it makes 723 00:34:18,280 --> 00:34:21,280 Speaker 1: more and more sense to continue to invest that money 724 00:34:21,360 --> 00:34:24,040 Speaker 1: to protect it more against inflation, because guess what, your 725 00:34:24,040 --> 00:34:27,480 Speaker 1: mortgage interest rate is far below the rate of inflation 726 00:34:27,520 --> 00:34:30,240 Speaker 1: is right now, So it's actually like an inflation hedge 727 00:34:30,320 --> 00:34:32,359 Speaker 1: to to hold on to that. Yeah, yeah, what better 728 00:34:32,400 --> 00:34:34,440 Speaker 1: hedge is there on inflation over the years than the 729 00:34:34,480 --> 00:34:37,200 Speaker 1: ability to you know, lock in a fixed expense, in 730 00:34:37,200 --> 00:34:39,959 Speaker 1: this case, your mortgage, while you can expect to earn 731 00:34:40,000 --> 00:34:42,320 Speaker 1: more with a higher income and with you know, higher 732 00:34:42,320 --> 00:34:45,080 Speaker 1: returns on money that you've got invested. You know, that's 733 00:34:45,120 --> 00:34:47,520 Speaker 1: that's exactly what happens when you buy a home on 734 00:34:47,560 --> 00:34:49,800 Speaker 1: a fixed rate mortgage, because I know that the payments 735 00:34:49,840 --> 00:34:52,520 Speaker 1: I make all my house and all my investment properties 736 00:34:52,520 --> 00:34:55,400 Speaker 1: aren't gonna go up at all over the next thirty years, 737 00:34:55,840 --> 00:34:59,000 Speaker 1: but our rent is going to be higher, like twenty 738 00:34:59,080 --> 00:35:01,920 Speaker 1: years from now, and you can all but guarantee that 739 00:35:01,960 --> 00:35:04,600 Speaker 1: rents are gonna be higher. Uh, and all the while 740 00:35:04,840 --> 00:35:07,280 Speaker 1: my payments that I make to the bank aren't going anywhere. 741 00:35:07,280 --> 00:35:09,560 Speaker 1: It's the exact same. Yeah, that's exactly right, Mad. Even 742 00:35:09,600 --> 00:35:11,600 Speaker 1: some of the rental properties you and I have had 743 00:35:11,600 --> 00:35:14,920 Speaker 1: for just over a decade, for like twelve years, those 744 00:35:15,040 --> 00:35:17,880 Speaker 1: those properties, like we've seen rents go up quite a 745 00:35:17,880 --> 00:35:20,840 Speaker 1: bit in that time period, and yet the monthly note 746 00:35:20,920 --> 00:35:23,560 Speaker 1: on that mortgage hasn't really changed all that much, with 747 00:35:23,640 --> 00:35:26,719 Speaker 1: the exception of tax increases, right right, That's why we 748 00:35:26,760 --> 00:35:28,799 Speaker 1: are huge fans of real estate investing. That's right. Yeah, 749 00:35:28,840 --> 00:35:32,160 Speaker 1: it's another another check mark in the in the box 750 00:35:32,320 --> 00:35:34,719 Speaker 1: of why real estate investing is great. But when it 751 00:35:34,800 --> 00:35:37,000 Speaker 1: comes down to it, Matt, like the you can't stop 752 00:35:37,239 --> 00:35:40,040 Speaker 1: the perpetual move of inflation, like none of us can 753 00:35:40,040 --> 00:35:42,319 Speaker 1: in the forward march of time. Yeah yeah, yeah, none 754 00:35:42,360 --> 00:35:45,160 Speaker 1: of us can turn back time like like share. But 755 00:35:45,239 --> 00:35:48,800 Speaker 1: the factors like causing inflation, they're just out of our hands, 756 00:35:48,800 --> 00:35:51,120 Speaker 1: like they're they're far beyond us. It's this it's this 757 00:35:51,280 --> 00:35:54,000 Speaker 1: world economic thing that that you and I don't have 758 00:35:54,040 --> 00:35:56,759 Speaker 1: any influence over than none of us do. And yes, 759 00:35:56,840 --> 00:35:59,399 Speaker 1: some periods of time we're gonna experience inflation happening more 760 00:35:59,480 --> 00:36:02,440 Speaker 1: rapidly like we are now. Other times we'll see a 761 00:36:02,520 --> 00:36:06,799 Speaker 1: more gradual increase of inflation. But your specific rate of 762 00:36:06,840 --> 00:36:10,200 Speaker 1: inflation it doesn't have to reflect the overall CPI numbers 763 00:36:10,200 --> 00:36:13,560 Speaker 1: that come out every month and the reports of increased inflation. 764 00:36:13,640 --> 00:36:17,239 Speaker 1: They don't have to change how we react, or we 765 00:36:17,280 --> 00:36:19,960 Speaker 1: don't even have to make any changes based on seeing them. 766 00:36:20,000 --> 00:36:22,759 Speaker 1: There are are certainly some folks who are more at 767 00:36:22,840 --> 00:36:26,480 Speaker 1: risk of inflationary shocks than others, but there are ways 768 00:36:26,560 --> 00:36:28,520 Speaker 1: for all of us to fight back and keep more 769 00:36:28,560 --> 00:36:31,439 Speaker 1: money in our pockets, even as things feel like they've 770 00:36:31,440 --> 00:36:33,799 Speaker 1: gone a bit haywire around us. And so what Matt 771 00:36:33,840 --> 00:36:36,120 Speaker 1: and I really want is is for us to not 772 00:36:36,160 --> 00:36:39,960 Speaker 1: freak out, to actually thrive in this inflationary cycle. And honestly, 773 00:36:40,000 --> 00:36:42,440 Speaker 1: even as the headlines have spelled doom and gloom for 774 00:36:42,480 --> 00:36:44,399 Speaker 1: everybody when it comes to losing more of our money 775 00:36:44,480 --> 00:36:46,799 Speaker 1: to inflation, if you have listened to the show and 776 00:36:46,840 --> 00:36:48,840 Speaker 1: if you have been taking the actions that we have 777 00:36:48,880 --> 00:36:51,040 Speaker 1: talked about for the last four years, and then we 778 00:36:51,080 --> 00:36:54,160 Speaker 1: will continue to talk about you. You should have done you. 779 00:36:54,280 --> 00:36:57,080 Speaker 1: We must have not incredibly well, because if you've been 780 00:36:57,120 --> 00:37:00,360 Speaker 1: investing your money in those widely diversified next one so 781 00:37:00,360 --> 00:37:02,520 Speaker 1: that we've talked about, you've crushed it. You've you have 782 00:37:02,600 --> 00:37:06,040 Speaker 1: far outpaced the rate of inflation. Your money is in 783 00:37:06,080 --> 00:37:08,239 Speaker 1: a good spot. And if you've been playing paying down 784 00:37:08,239 --> 00:37:11,040 Speaker 1: those high interest rate debts, you're in a good spot. Uh. 785 00:37:11,040 --> 00:37:12,960 Speaker 1: And so yeah, there there are small tweaks you can 786 00:37:12,960 --> 00:37:14,640 Speaker 1: make around the edges, but when it comes down to it, 787 00:37:14,800 --> 00:37:16,960 Speaker 1: the fundamentals that we talked about on the show all 788 00:37:17,000 --> 00:37:21,480 Speaker 1: the time still apply, and we'll continue to apply in perpetuity, exactly. 789 00:37:21,560 --> 00:37:23,600 Speaker 1: Man couldn't have said it better myself. Let's go ahead 790 00:37:23,680 --> 00:37:26,200 Speaker 1: now then and get back to the beer. On this episode, 791 00:37:26,400 --> 00:37:30,359 Speaker 1: you and I shared a chocolate pecan porter. And this 792 00:37:30,440 --> 00:37:34,040 Speaker 1: is my Tim Blore Brewing company out there in California. Joel, 793 00:37:34,120 --> 00:37:35,919 Speaker 1: we're your thoughts on this one, Okay. So I gotta 794 00:37:35,960 --> 00:37:38,640 Speaker 1: say I love pecans or pecans however you want to 795 00:37:38,640 --> 00:37:41,319 Speaker 1: say anything, I was gonna ask you if Okay, So 796 00:37:41,360 --> 00:37:44,040 Speaker 1: we had Thanksgiving was a few weeks ago. Pecome by? 797 00:37:44,200 --> 00:37:45,719 Speaker 1: Was that? Was that on the menu? Definitely had a 798 00:37:45,719 --> 00:37:48,480 Speaker 1: slice of course yes. And some people hate pecan pie, 799 00:37:48,600 --> 00:37:49,880 Speaker 1: like you either love it or hate it. I think 800 00:37:49,920 --> 00:37:51,560 Speaker 1: I like it, all right, I was like my favorite. 801 00:37:51,600 --> 00:37:53,960 Speaker 1: I mean, you can't beat a fresh, you know, hot 802 00:37:53,960 --> 00:37:57,040 Speaker 1: out of the oven apple pie. Yeah that's true. That's true. 803 00:37:57,640 --> 00:37:59,040 Speaker 1: Not super hot because you need it to set up 804 00:37:59,080 --> 00:38:00,839 Speaker 1: that way. It doesn't just like out onto your plate. 805 00:38:00,880 --> 00:38:02,400 Speaker 1: But if you wanted to sit up a little bit, 806 00:38:02,480 --> 00:38:04,360 Speaker 1: but like that, if it's like a little bit warmed 807 00:38:04,360 --> 00:38:06,279 Speaker 1: with some ice cream, I mean, you can't beat that, 808 00:38:06,280 --> 00:38:08,960 Speaker 1: all right. If you had to choose pecan or pumpkin, 809 00:38:09,000 --> 00:38:11,879 Speaker 1: what would you choose? Oh? I feel like pumpkin pie 810 00:38:11,960 --> 00:38:14,399 Speaker 1: is one of the divisive pies, like people either hate 811 00:38:14,440 --> 00:38:16,920 Speaker 1: or love that. I'm probably gonna have to give the 812 00:38:17,040 --> 00:38:19,680 Speaker 1: edge to pecan pie. Same here over pumpkin pie. But 813 00:38:19,719 --> 00:38:21,840 Speaker 1: I do love pumpkin pie. Okay, all right, Well you 814 00:38:21,920 --> 00:38:25,520 Speaker 1: like all the pies? I think I do. Well. Yeah, 815 00:38:25,560 --> 00:38:27,479 Speaker 1: when it came to this one, you know, I really 816 00:38:27,480 --> 00:38:30,359 Speaker 1: like pecans, and I thought this one had a nice 817 00:38:30,360 --> 00:38:32,680 Speaker 1: pecan presence in there. And I've never had like a 818 00:38:32,760 --> 00:38:35,240 Speaker 1: chocolate cover pecan. Although like all these cells to chocolate 819 00:38:35,280 --> 00:38:39,440 Speaker 1: covered almonds, which are delightful and delicious and should always 820 00:38:39,440 --> 00:38:41,359 Speaker 1: have someone hand to push it over to pecans maybe 821 00:38:41,400 --> 00:38:43,439 Speaker 1: that would be delicious, maybe because this Yeah, I really 822 00:38:43,440 --> 00:38:45,520 Speaker 1: like the vibe going on here. The nutty in the 823 00:38:45,600 --> 00:38:49,160 Speaker 1: chocolate uh inside of a porter was just yeah, really 824 00:38:49,200 --> 00:38:51,560 Speaker 1: well done, and so yeah, this one was really tasty. 825 00:38:51,560 --> 00:38:53,239 Speaker 1: I enjoyed it. Yeah. Yeah, this is one of those 826 00:38:53,239 --> 00:38:55,640 Speaker 1: reasons why a porter is fantastic because you get all 827 00:38:55,640 --> 00:38:57,759 Speaker 1: that flavor without having to like chew on your beer, 828 00:38:57,800 --> 00:39:00,000 Speaker 1: which is oftentimes what you get with a really big style, 829 00:39:00,360 --> 00:39:02,040 Speaker 1: which can be fun at times, but if you're just 830 00:39:02,080 --> 00:39:05,520 Speaker 1: looking to enjoy a nice dark beverage here in these 831 00:39:05,600 --> 00:39:08,479 Speaker 1: colder months, a quarter like this definitely hits the mark. 832 00:39:08,800 --> 00:39:12,200 Speaker 1: So a big thanks again to Ryan and our friends 833 00:39:12,239 --> 00:39:15,520 Speaker 1: out there at tim Blore Brewing Company uh for sending 834 00:39:15,560 --> 00:39:17,520 Speaker 1: us one our away. And you can actually find a 835 00:39:17,560 --> 00:39:20,359 Speaker 1: picture of this beer, plus any of the other resources 836 00:39:20,400 --> 00:39:22,719 Speaker 1: we may have mentioned during this episode, up on our 837 00:39:22,719 --> 00:39:25,399 Speaker 1: website at how to money dot com. No doubt, all right, Matt, 838 00:39:25,400 --> 00:39:27,839 Speaker 1: that's gonna do it for this episode. So until next time, 839 00:39:28,120 --> 00:39:30,200 Speaker 1: Best Friends Out, Best Friends Out,