December 15, 2021 • 39 mins
Higher prices and inflation are all over the headlines and you might be wondering how concerned you should be. Unfortunately this is one of those times where you might be tempted to overreact as you try to take control of a situation. It makes us think of when someone is diagnosed with cancer- yes there are instances where you need to immediately treat it, but there are also cases where it’s best to not take any drastic measures and instead just monitor the situation. We want to avoid the kneejerk reaction and the ‘just do something!’ mindset, when instead there are other steps we should be taking. So that’s what we’re talking about today- why we’re experiencing high inflation, how concerned we should be, and then the many different steps that you should consider in order to keep yourself from freaking out over inflation.
During this episode we enjoyed Chocolate Pecan Porter by Temblor Brewing- a big thanks to Ryan and our friends there at the brewery for donating this delicious craft beer to the podcast! And please help us to spread the word by letting friends and family know about How to Money! Hit the share button, subscribe if you’re not already a regular listener, and give us a quick review in Apple Podcasts or wherever you get your podcasts. Help us to change the conversation around personal finance and get more people doing smart things with their money!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to How the Money. I'm Joel and I am Matt.
Today we're asking the question, is inflation making us crazy? Inflation? Man,
(00:26):
it has been in the headlines, and so we felt
that it was time for us to devote an entire
episode to talking about inflation a little bit more. We're
gonna do that during this episode. Inflation has us living
la vida loca, I would say, Matt. Uh, So, here's
the thing. Speaking of inflation, I wanted to tell you
a little story about where do you go get gash nearby?
So I don't know, it just depends on Usually it's
(00:47):
when I'm just at Costco. I try to fill up
at costcocause it's always cheaper than But there are a
couple of places. It turns out. I used to think
that the Kroger. The Kroger has got to be the
most expensive place. So that's what I was gonna say,
is we used to always go to the local Kroger.
It's really close to our house. Um, and because occasionally
we go to Kroger for some groceries and we always
have some points where we get the discounted price per
(01:07):
gallon on gas. But recently I noticed that just a
gas station a BP just a mile down the road.
It was something like twenty cents cheaper per gallon. Uh.
And here's the thing, this isn't a gas station that
I have to go out of my way to reach.
This is on the way to Aldie. We've always said
it's cheap if you're gonna drive across town of the same,
but if it's easy to save, go save the money, exactly.
(01:27):
And so initially I noticed this a couple of months ago,
And initially I thought that maybe they had just not
raised their prices, because this is when price we were
seeing prices take up pretty significantly, pretty dramatically. Uh. But dude,
it has consistently stayed twenty cents at least twenty cents
cheaper than Kroger, uh than the shell further up the
road as well. And so I have changed. I mean,
this isn't a big deal, right, Like, you're only talking
(01:48):
twenty cents per gallon, and we don't even drive all
that much. The bottom line doesn't impact us all that much. No,
But I wanted to share the story because it takes
breaking out of the habits and the mindset that we
typically do think sometimes in order to save us money. Right,
So I think like when it comes to groceries, sometimes
we might think, oh, well, we always have to get
this product or or this cut of meat. This is
(02:08):
we always eat ribbies, you know, we always eat boneless,
skinless chicken, yes exactly, but instead to consider some of
the other options. Ever, we're more flexible. That can save
us in a big way. It also makes me think
about like cell phone service. I was just talking to
a buddy recently and he was like, yeah, I'm still
paying a lot of money for my Verizon service. And
I spent a good five minutes and he was interested,
(02:29):
and I wasn't just like brading it down the throat,
and I was explaining to him h M v n
o s, which are the mobile virtual network operators which
operate on the backbones on the networks of the major
you know, big names, but they charge you a fraction
of the cost. And so, for instance, you and I
were on Mint Mobile, right, and they operate off of
T Mobiles networks, and you get all the great speed
(02:50):
that comes with a T mobile, uh service, but at
a fraction of the cost exactly. But so many people
are just stuck in their ways paying the same phone
company the same amount of money every single month. And
and yeah, actually right now, like Mint has that three
by three months, get three months, three get three so
it like takes that super cheap phone service down to
an even lower price for those new customers. So yeah,
(03:13):
well we'll link that in the show notes. By the way,
people want to know about it. But Matt, let's move on.
Let's talk about the beer that we're having on this show.
This one is called Chocolate Pecan Porter. Do you say pecan? Pecan? Uh? Pecan? Okay? Wecan?
I think I did like a blending of it too,
like a hybrid. I had it in my mind. So
I grew up saying pecan because I was raised in
(03:35):
the South. Yes, but now I say pecan because I
live in the city. Now you're you're very refined. But yeah,
this one is by Tim Blore Brewing, and this one
was sent to us by listener Ryan, who works for
the brewery. So we're always always down for delicious craft beers. Ryan,
thanks for sending these ones to us. But Matt, let's
get onto the subject at hand. Let's talk about inflation.
(03:57):
Let's do it. And you know, it just kind of
made me think the other today, how how nutty the
conversation around inflation has gotten. Uh it, I don't know why.
It kind of made me reflect on one of my
friends who like a decade ago, ended up getting diagnosed
with prostate cancer. And yeah, tough diagnosis to receive, and
it was like obviously just an emotionally difficult time for him,
(04:18):
for his friends and family, everybody who was close to
him and who loved him. Um, but there's this belief,
I think when it comes to cancer that you gotta
go like harden fast in order to eradicate it, right,
that it's the fight against cancer exactly exactly, And so
there's this, Yeah, there's this belief that you gotta treat it,
you know, treaty quickly, and you gotta throw like all
the ammunition at it at once, exactly. And so yeah,
(04:41):
for unfortunately, my friend, he's doing really really well these days.
But that's actually largely because he took the opposite approach.
He decided not to throw the kitchen snake at this cancer.
He decided to do something called watchful waiting or it's
also known as active surveillance in the prostate cancer community,
basically keeping an eye on the growth rate of the
cancer and the potential symptoms, so that action can be
(05:03):
taken if need be, But the point the hope is
to not take action too soon because that could actually
greatly diminish the quality of life for the patient. That
surgery is obviously invasive, and you and I were obviously
we're not doctors, were not cancer experts. Recently, we did
an episode where we talked about I feel like we
talked a lot about dieting recently, and so what we're
(05:24):
definitely not nutritionists, we're not doctors either. It's just anecdotal
evidence to support something that we're gonna talk about this
outside like we'd like to dabble, right, But it's just
interesting to see how overreacting can actually create more problems
depending on the circumstance that you're going through, right, And
so in this case, reacting too quickly and having that
invasive surgery could have had other more consequential side effects,
(05:47):
and so waiting made the most sense. And you know what,
in over a decade, he hasn't had to have any
surgery and he's living a great life. And so yeah,
could the same be true when it comes to inflation
that maybe we're overreacting a little bit. That's kind of
what we want to talk about today. Yeah, that's right.
You know, it's understandable that many folks are starting to
worry about inflation. For the most part, it's been minimally impactful,
(06:09):
you know, for so long that most of us hardly
even remember that it exists. But that's all changed over
the past year due to a variety of factors. Right.
First of all, many of us have more cash in
our bank accounts due to stimulus payments, due to the
inability to spend our money like we normally would due
to COVID, so there's a ton of pent up demand.
And then on the supply side of the equation that
(06:30):
has also been massively disrupted and companies are having a
tough time catching up. Pandemic related shutdowns are still impacting
companies across the world. And so you combine all these
different factors, UH and inflation. It hasn't been as high
as it is currently for over thirty years. But the
question that we want to ask, though, is that should
we be concerned about it? Because you know, we we
don't want to read the headlines or watch the news
(06:52):
and then just react in drastic ways that are gonna
undermine our finances. Um And it turns out in a
recent poll we saw that of few well said that
they are very worried about inflation. And you know, all
these substantial levels of concern about inflation, they're actually starting
to concern us, concern you and me. Yeah, we're like, no,
there's just maybe too much talk about it. It's it's
(07:14):
gotten overblown, and it just seems like it's one of
those narratives that's spun out of control where we're all
talking about inflation and we're all like looking at it constantly.
We're looking for signs of relief or we're looking to
numbers to prove how bad it's gotten. Yeah, for political reasons. Yes,
sometimes it gets hyped up because folks have a different
agenda exactly. Yeah, And it feels like there's like some
(07:35):
sort of a psychological shift taking place in our brains collectively,
because in that same survey, forty percent of folks said
they plan to reduce their spending on restaurant meals and
on takeout, said they plan to skip upgrading their personal
technology devices. Folks said they're going to purchase less clothing
or delaying or canceling travel plans, and of folks said
(07:57):
they plan to drive less, a lot of changes. Yeah,
there's a lot of changes that people are making their
lives because of inflation. But yeah, holding off on purchases,
buying fewer things overall, that's a natural reaction to rising prices.
I get it, and those can be wise financial moves
no matter what's happening with the inflationary numbers, you know, anecdotally, Matt,
there was a post in the how to Money Facebook
(08:17):
group that I think it kind of echoes how a
lot of people are are feeling right now. A listener said,
should I be buying more stuff now because of the
fear that prices are gonna rise in the future. It's like,
should I should I frontload those things that they're on
my wish list? I was planning on holding off until
next year or till like, yeah, like fall of next year.
But I'm just worried it's gonna cost more now, so
(08:39):
should I jump in on that thing? I think that
question reflects another place that this inflationary environment can push
us towards. It can push us towards spending more money now,
even if maybe we don't have that money exactly. Yeah,
So but before that we talk about how to ensure
that rising costs inflation prognostications don't make you crazy. I
think it's really important to remind everyone at inflation is
(09:00):
just something that is always taking place in the background
of our economy. You know, most of the time, it's
it's something that we just don't even notice, you now,
even though it's still kind of humming along. It's sort
of like the sound of the like the compressor fan
on your fridge. Like, just because you get used to
it doesn't mean that it's not consistently chugging along, or
at least that it you know, it should be. That's
how your fridge days cold. And so just because inflation
(09:22):
isn't typically in the headlines, that doesn't mean that it's
you know, been sitting at zero up until now. If
if you look back at the data actually over the
last thirty years, the average consumer price index is two
point four percent. Like that is a real rate of inflation.
And so it's it's just important to keep that in
mind because they can often get discounted when inflation is
discussed today. Um, when when you see it in the headlines.
(09:44):
And I wanted to mention this too, because we're talking
about inflation right now, so aren't we a part of
the problem. But I just want to make it clear
that we've been talking about inflation way before it was cool.
We've been basically ever since we started talking about investing
on this show four years ago. Inflation was one of
the reasons that you should be investing. I will say,
we are always a part of the problem. Just that's
just generally how we roll. It's true we we like
(10:05):
to make trouble. But yes, I agree we we have
been talking about inflation every time we have to talk
about risk when it comes to investing, Inflation is the
thing that pops up, because that is the thing in
the background continually eating at your money if you don't
take the necessary risk of investing. There's a known quantity
of risk, and that is inflation. So it's important, the
sure and steady risk exactly. It comes up in every
(10:25):
conversation that we have about investing. It seems like in appropriately.
So so yeah, we're not trying to be fearmongers here
when it comes to inflation. I think, in fact, we're
trying to do the opposite with this conversation, and maybe
trying to tamp down the fears the people that people
have and and hopefully we'll all become a little less
crazy when it comes to how we think about inflation
and how we react to it. I think it's also
(10:46):
important to note that age likely plays a factor in
how you perceive inflation, because, yeah, even though inflation has
been like you said, Matt Humming in the background, it's
still significantly higher than what our generation has ever experience. Right,
Let's say you graduated from high school or college ten
years ago, and only then did you start paying attention
(11:07):
to prices, really, uh, except for maybe prices right with
your grandma on like a Tuesday afternoon when you were
out of school, Well, you only experienced inflation that was
an average of one point seven percent. So those prices
were taking up just incredibly slowly. And so many of
us have never experienced inflation like we're currently seeing it,
but our parents have. Right back in the seventies and eighties,
(11:30):
the average inflation rate was over six percent, kind of
similar to where we're at now. And so yeah, if
you wanted a mortgage back then, you were looking at
a thirty year fixed rates that were bumping up close
to eight per cent. So we just like live in
different financial times, and I do think age provides some
proper perspective, or at least knowing your history can provide
some proper perspective into that reality that inflation is always
(11:54):
at play in some form or fashion. Uh and that
rate of inflation just changes over time depending on other
circumstances happening in the economy and in the world. That's true, man,
I think it's in what you said to just what
we've experienced over the past decade is something that we
can't underestimate. Right. For a lot of us, we've never
experienced a bear market, We've never experienced rates of inflation
(12:14):
that have been this high. Like a lot of folks
came into their professional careers seeing a negative inflation rate.
And so it's really important to keep in mind our
own lived experiences and how that impacts how we interpret
the news and the headlines in our world. Yeah, exactly,
Like I became an investor in two thousand seven, and
uh so, you know kind of I certainly was an
(12:35):
investor while the market was having a moment, was having
you know, while we were going through a recession. But
I didn't have like a lump sum that took a
big hit, and so it didn't impact me in the
same way, uh that as it would have someone who
was twenty years older than me and had been investing
a whole lot longer. And speaking of just kind of
like your personal situation and how that impacts things, Matt,
(12:57):
there's actually a way too personally calculate eight the inflation
that you as an individual or seeing. We're going to
talk about that and getting to more about how you
should be reacting to what's happening when it comes to inflation.
Right after this, all right, we are back from the break.
(13:20):
We're talking about inflation, and it's true, prices are actually rising.
You know, we're seeing prices go up at the grocery store.
We're seeing at the gas pump at Kroger specifically, their
prices are really high, at least at the gas pump. Yeah. Uh,
Like houses and cars, like they are way more expensive
than they were just a year ago. And so across
the board we're seeing higher prices. But keep in mind
(13:41):
that that's just simply how inflation works, right, Like, this
is a part of progress and innovation, This is a
part of the growth of our economy. Uh, it would
actually be a bad sign if we saw prices dropping
and we were entering into a deflationary environment. That's actually
what we saw back in two thousand nine, Jewel, you
mentioned that right before the break, how we saw the
market tank than but we saw a deflationary environment. In
(14:04):
two thousand and nine, inflation was actually at negative point
four percent. Uh. And you probably don't need a reminder
how difficult it was to land a good job back then.
But the big question right now, though, is is inflation
something that you should be paying attention to? You know,
how concerned should you be? Uh? And like you said,
so much of this comes down to what exactly you
(14:25):
are buying, what you're spending your money on. That's right,
that's right. And yeah, we're seeing the headline number, the
actual percentage rate that is getting up in the high
single digits of where inflation is at right now, but
the overall rate of inflation. While it's it's good to know,
drilling down to see how inflation is actually impacting you
and your family is even more helpful, like seeing what
(14:47):
inflation is doing at a personal level. And obviously, if
you're a good budger, if you track your expense as well.
You can probably run the numbers like Matt, with how
much data you have about your own household spending. I'm
sure you could figure out that compared to last year,
exactly how much inflation is impact your finances. You can
probase you in like twenty minutes, right, that's true. Literally, well,
(15:07):
we were talking about something the other day and it
was something from like two thousand and eight, and I
was able to literally tell you how much I spent
on something because I was just like, well, let me
pull up the eight budget dot xls excel file and
I was able to nerd out and let you know
my numbers. It's quite impressive. Also, um, yeah, there's also
my dedication. Also, I need help just beyond the professional help. Yes,
(15:31):
but yeah. Interestingly enough, the Wall Street Journal has this
like inflation calculator that will link to, which can be
helpful if you don't have the numbers, the raw data
that Matt has, but you want to see how much
inflation is actually impacting you based on how you spend.
You can kind of plug some numbers in there. We'll
put that in our show notes. For instance, like if
you only have one car in that car is an
electric vehicle. Right. The fact that the massive run up
(15:53):
in fuel prices is a huge component in the overall
rate of inflation, well, that's not affecting you, So your
personal rate of inflation is going to be far lower. Also,
you know the run up in car prices, We've talked
about that on the show, Well, it's made up a
huge aspect of the increased inflation exactly. And if you
are like content with the one eight year old car
that you have or whatever, like you're not looking to
(16:15):
buy a new car, well, inflation is impacting you in
a much more minimal way. And so yeah, if you
really want to nerd out, you can check out the
Bureau of Labor Statistics CPI report, which will link to
in the show notes, which goes into a great deal,
almost as much detail as Matt's two thousand eight budget.
But I look at those reports and not totally heard out.
So yeah, it's it's it's interesting stuff. But it's also
(16:37):
important to note that those overall headline numbers are not
the necessarily the rate of inflation you are paying, and
your rate of inflation could be half of what you're
seeing as a headline number, or or maybe less, and
so kind of figuring out what it's looking like and
where it's actually impacting you is helpful. Yes, we share
all that to help you to realize how big or
how little of a deal this is going to have
(16:58):
on your finances. Uh. And dude, that's another whole side
of this too, is the fact that this is uh
an increase in prices, right, And so that means if
you are spending your money, like, there's a whole side
of our finances that don't have to do with spending.
And hopefully we see that decrease over time as we
tend to earn more money over our lifetimes, we'll see
the percentage of money that is going towards expenses. We'll
(17:19):
see that decrease as we increase our savings rate. Right,
But okay, let's talk about what to do. How you
can go about not freaking out about inflation because you
know the headlines they're not going to stop. And inflation
itself could be a more meaningful part of our lives,
and it's been over the past couple of decades. But
that doesn't mean that we have to yo yo back
and forth with every piece of inflation information that comes
(17:42):
our way. And so some of it starts with how
we consume news. This is uh one of these areas
where we feel that less can be more, especially if
your tendency is to freat more based on your news consumption,
and you know, along those lines, I think it can
be helpful if you are aware of some definitions, because yes,
we are dealing with higher inflation, but we're not talking
about hyper inflation, which means a rise in prices to
(18:04):
the tune of one thousand percent annually every single year here.
You know, we talked about that after Jack Dorsey tweet
a couple of months ago, the former CEO of Twitter,
And maybe that's why he stepped down, because I realized
he's like, I was a fool. I shouldn't have said that.
I can believe that tweet. Um. And you know, we're
also not dealing with stagflation. I feel like that's the
term we here thrown around occasionally because that's when you
see inflation coupled with slow economic growth and high unemployment,
(18:28):
both of which we've seen rebound significantly since the coronavirus
hit last spring. UH. So it's helpful to push back
against the fear of inflation just by knowing you know
what it is that we're actually living through, just by
having some definitions and to realize that we're not working
our way through regular inflation to these more exotic forms
of inflation or just I don't know, do you just
(18:49):
say inflation generally speaking as like the the broader concept
that is not what we're dealing with right now, Yeah,
for sure. And so yeah, knowing those definitions, knowing what
exactly we're do link with this is helpful. But there
are also some practical steps that we can take to
to fight back against inflation in our own lives and
and to make sure that it isn't, like we said,
(19:10):
slowly eroding the value of our money or as is
happening right now a little more quickly than it has
in the in the best in the previous a few years.
But we think it's important to fight fire with fire.
And then and then that evolves pushing for to make
more money, uh, pushing for a wage increase. Because of
the whack of doodle inflation that we're seeing these days,
(19:30):
it hasn't been easier in a long time to negotiate
a higher salary or extra perks, Like if you haven't
gotten a raise in quite some time, it's time for
you to ask your boss to see, like how much
more you can make. And if your employer is offering
a normal raise in that two to three percent range
that you're used to getting that cost of living adjustment,
(19:50):
you gotta push for more. That's just not going to
do it right now. And it's it's important to bring
your knowledge about inflation and what's happening right now to
these conversations and to push back and say, do you
realize that's actually that's not even a raise like that
you're not even allowing me to keep up with the
increasing costs of goods and services. And so, yeah, if
your employer isn't willing to budge on your pay, it's
(20:12):
time to do some digging in the job market to
see what sort of pay you can command elsewhere, and
you can use that as leverage in the negotiation process
or mosey on down the road to a new job
where you can get paid a decent chunk more. But yeah,
finding to make more money is a huge part of
how you actually push back against the way inflation is
impacting you and your own personal finances. That's rights another
(20:35):
way we can combat inflation is just simply by consuming less,
you know, remember the stats that we gave back at
the beginning of the episode. We'll purchasing fewer things overall,
and finding ways, you know, just to get the items
that you do need, either for free or for you know,
or for cheaper is something that we can always get behind,
but especially now, um, you know, and so that can
(20:55):
be as simple as just making dinner at home, brewing
your own coffee. Those are legitimate helpful ways to make
inflation hurt your bottom line in a smaller way. By
nothing groups. They are in an excellent place to find
things that you want that don't cost a time. Uh Facebook, Marketplace, eBay.
These are all great for buying used. Depending on the item,
we may not see inflation having as large of an
(21:15):
impact on the used marketplace, and so that's just an
effective way to stretch your dollar even more. Yeah, the
market for local goods in your community via sites like
Craigslist or Facebook, marketplace, you're going to in all likelihood, well, one,
you're just gonna save money buying used, right, Like, that's
one way to save money. But then on top of that,
you might see uh more imperfections in that market, and
(21:37):
so you might see someone selling an old couch or
something that depending on the age and the wear and
tear in the location and how you pick it up,
they're they're not charging as much as they potentially could be.
And so yeah, I think there there's just there are
more ways for you to save and to combat inflation
by buying used and by sticking to some of those
sites to buy more of the things that you might
have opted to buy new totally on your favorite internet
(21:59):
web site swap a offer up, like, there's all these
other apps as well that I mean, honestly, like you
and I, we don't use all that often because we're
trying to minimize what we're purchasing all together. But there
are a lot of different options out there for folks, yes, exactly,
And so yeah, another question Matt that comes up for
people is about stockpiling, like buying and consuming less stuff.
That's one way to decrease the impact of inflation, But
what about the opposite, what about what's known as kind
(22:22):
of pulling demand forward and so buying things that you
were attempting to hold off on, uh and saying you
know what, because of the fear I have about inflation,
because of the fact that this item is in all
likelihood going to cost more next month, or at least
that's my brain's assumption because I'm seeing all these headlines
about inflation. Should I buy that item now? And that's actually,
(22:44):
you know, when I refer to that listener on Facebook,
that's that's really what she was asking about. Does it
make sense to purchase something now assuming that the price
is going to go up? And I think the answer
to that depends on you know, what the item is,
whether or not you can afford it is a huge
is a huge piece of that. You know, don't go
into debt in order to secure a small purchase or
a medium sized purchase, because then you're paying interest on
(23:06):
that item, and that defeats the purpose of saving money
on the item. We can pretty much guarantee that the
interest that you're gonna pay on an item paying for
it with credit is going to be much higher than
the rate of inflation over the next year. Yeah. But
but if you have the cash and you're just accelerating
a bigger purchase because you want to ensure that you
lock in the price that it's at and you don't
want to pay more down the road, that's not a
(23:27):
terrible idea. We would just say, just don't let the
current inflation reality and then you know, future inflation concerns
get you too jumpy because that kind of leads to
a cycle for for all of us. If we're buying more,
consuming more, Uh, prices are going to go up at
a faster rate, and that leads to a more inflationary
environment in general. And it's just not good for your
(23:47):
personal financial situation to continue to push forward spending to
buy things sooner than you otherwise would just because of
inflationary fears. Yeah, it's kind of like options trading. I
feel like folks who like to stockpile and hoard might
all to overlap with those who might be interested in that.
But like, essentially this is kind of like the costco effect, right,
That is how a lot of folks are able to
get such a good deal at costco. Oftentimes it is
(24:09):
the price, but it's because of the quantity. Uh. And if,
of course, if you have a place to store all
of those items and you're not going to be tempted
to over consume those items, then it could be a
good deal for you. Because I think that's another way
that we have to be honest with ourselves, is are
you gonna be wasteful? Right? Like, just because you have
more of a certain product on hand, you need to
be honest with yourself. And uh like, are you going
to be more likely to burn through a bunch of
(24:32):
paper towels because you've got six rolls of paper towels
in your cabinet and it's kind of taken up a
bunch of space. Like it makes me think back to
I mean even now to a certain extent. I was
talking about gas at the beginning of the episode. But
when I'm getting close to the e you know, on
the on the gas cage, I tend to drive a
bit more gingerly, Like I I coast more. I I
don't floor it as often. But Dude, after I fill
that tank up, I'm like get in places quickly. It's like,
(24:55):
I think I am not wasting time because I know
that I've got a full tank. There's something like instinctually
human and about that when you have more resources, you're
just you're more wasteful. Exactly, when there's more money in
your bank account and it's not earmarked for something, you're
more likely to like say, screw it, I'm gonna buy
that thing now on a whim, even though you haven't
planned on it. Yeah, I I completely there's that psychological
(25:15):
component of having I don't know, excess resources, either in
your bank account or in your cabinet just depends if
you're talking about dry goods from costco or just money
in the bank. But we've got a few other ways
that we can combat and fight against inflation and its
impact on our finances. We'll touch on how investing can
help us to fight inflation. We'll get to all that
right after this break. All right, we'll back matt Let's
(25:45):
keep talking about inflation and how it's making us a
bit uh cuckoo for coco puffs? A bit crazy? Was that?
Did you uh eat cocoa pus As a kid, my
parents would rarely buy the name brand cereal? Matthew sentiment
to crunch for me, man all the way, Give me
like that one, a sugar cinnamon, like puffed rice whatever.
I'm still nostalgic for all those cereals like if are
we we never have them in our house. We never,
(26:07):
But if someone gave me a box, I would eat
the mess out of it, that's for sure. Like I
remember cinnamon to a scrunch back when they were still
serving it up, not in the plastic bag inside, but
when it was still like the foil bag. Remember the
foil bag. It was kind of like sticky around the top. Nice,
I'm getting old. It's a good throwback, all right. Well,
let's let's keep talking about inflation and how how to
come about it. And one of the main ways that
(26:29):
you can come about inflation in your life is to
plan and budget better. So yet, not only should you
consume less like we talked about to reduce the impact
of inflation, looking to buy used stuff like that, but
we also want you to pay special attention to your
budget and make changes accordingly. Like in a normal inflationary cycle, Uh,
you don't normally have to think as much about changes
(26:49):
to your budget. There there are small little tweaks you
can make in order to make sure that you kind
of make the numbers work. But as the numbers change,
as your grocery store run, or the amount you spend
on us every month doesn't stay the same as those
prices increase, there are some changes that we have to
make to our habits and to our behaviors in order
to kind of continue to live within our means. Uh,
(27:11):
But there's also a truth to there's only so much
that you can cut back, right, So you're gonna have
to adjust your budget to reflect the changing reality on
the ground. Because if you don't make any changes to
what you're buying and to the amount that you've budget
every month, if you're not changing things around and reallocating
your resources, chances that you're gonna go over budget just
are going up dramatically. That's right, And I mean and obviously,
(27:31):
like the most important thing about budgeting and tracking or
spending is to just to be able to have accurate information. Uh.
And so it's okay if that amount changes, right, Like,
that's that's not like throwing in the towel and admitting
defeat or anything like that. But the more accurate those
numbers are, the more helpful it will be when it
comes to you achieving some of the different financial goals
that you set for yourself. And it touches on, you know,
(27:51):
one of the different strategies that I have when it
comes to my spending when like we try not to
adjust how much we spend towards different categories from your
a year, because, like we said earlier, inflation does take place.
It is happening in the background, even when it's not
in the headlines, and if you are able to maintain
a certain level of spending, you are effectively spending less
(28:13):
every single year. Uh. And so that's kind of like
one of those little tricks where it's like, oh, my
gut's getting bigger, but I'm gonna keep the belts, you know,
on the same notch. It feels a little bit tight.
Eventually you get to a point to where you're like,
all right, this isn't it's either not accurate anymore, or
it's actually just impossible to actually contain the growth or
the money that you do want to spend. But again,
(28:34):
it's often about having accurate information, and when it comes
to your investment portfolio, you want to make sure that
you've you know, that you're aware of the impact that
higher prices uh will have on your nest egg, not
only on your expenses every month, like we just talked about,
but also on your retirements. You know, this is an
instance where it might make sense to be a little
bit more conservative. You know, this is especially true for retirees.
(28:56):
There's been the commonly dispensed four percent rule, which basically
states that retiree they should be able to draw down
four percent of their portfolio assets every single year. Uh.
And if they do that, they'll never outlive their money.
But the smart folks over at morning Star, they actually
just reassessed and say that it should be more like
a three point three percent draw down rate. Uh. So, yeah,
(29:18):
it changed that from point zero four to point zero
at three three. And that's based on an assumption that
equities are overvalued right now. Uh, and that bond rates
will remain low, And so being more conservative is going
to make sense in an environment like this. Yes, true, Matt.
But but while we're talking about investing, we would also
tell folks, tell our listeners, especially the younger ones who
(29:39):
have decades to grow their wealth, to not make massive
changes to their investment portfolio because they're worried about inflation.
Those are other headlines that you and I are seeing.
It's like how to inflation proof your portfolio. And we've
talked about this before. We did an episode about inflation.
I don't know, was it like eight ten months ago,
and we we talked about how stop are one of
(30:00):
the best places to put your money no matter the
inflationary environment, and a widely diversified portfolio made up of
mostly equities continues to be an excellent way to invest
your money even in this environment. So we would say
keep investing in the market each and every month, preferably
in those diversified index funds. And uh, Yeah, as we've seen,
this inflationary period has actually created more profitability for a
(30:23):
whole lot of companies. And so if you own a
small piece of the hundreds or thousands of companies in
that index fund, you stand to benefit. You're going to
see the amount in that retirement accounts continue to go up.
And so yeah, generally speaking, investing your money is the
most straightforward way to hedge against inflation. The more you
have in savings just sitting there in an account that's
(30:45):
getting eroded away, but the money that you have and
investments over time is going to healthily combat what's happening
with inflation. Yeah, you definitely don't want to have too
much money in your savings. Like obviously we like saving money,
but hoarding you know, just massive amounts, Uh, within an
inflationary environment like this means that your dollars are losing
their spending power more rapidly. You've got to be an
(31:07):
investor always, but especially now, don't put that emergency fund
money at risk in the market. But at the same time,
don't get too conservative and have just massive amounts of
money in your savings account. You want to put your
money that you don't need set aside in that emergency
fund to work, and you know, making small moves like
opting just to put some of your discretionary savings and
I bonds that can be a helpful inflation hedge. But
(31:29):
you don't want to make just these huge, massive overhauls
to your portfolio in an attempt to correct for those
higher inflation numbers. Yeah, it's tempting that, I think for
people to uh see us, to see one thing happening
and then to instinctively knee jerk make a reaction to
counterbalance what's happening in one space. And when inflation feels
(31:51):
out of control, you feel like you need to get
in control and and make a different move. But really,
the traditional way we've talked about investing uh it whole. Yes,
it remains true whether you're in a one and a
half percent inflationary environment or an eight percent inflationary environment,
it's still a great way to continue to invest your
money to continue to dollar cost average every two weeks
(32:11):
with your paycheck, or or just sticking to your investing
plan in general, investing as frequently as you like to do. Yeah,
I mean going back to your you know what you
said about your friend that had prostate cancer. It kind
of goes back to that. There's this mentality of feeling
like we got a mess with stuff. As as soon
as you hear something new or you hear something scary
like a cancer diagnosis, you think, okay, let's blast it.
But in reality that you know in his case that
(32:34):
wasn't what he needed to do, and in our case
when it comes to investing, and for a lot of people,
you don't need to do anything differently. You just keep
doing what you've been doing and ignore the headlines. Yeah,
it feels like it's action time, but in reality it's
time to like, I don't keep on doing what you've
been doing and take very little action. And let's talk
about debt to Matt, because that's that's a question that
comes up when people are hearing what's happening with inflation.
(32:56):
Should it change the way I'm like tackling or paying
off my debt? Well, that depends but in some ways.
Actually yes, with low interest right debt? Right, have you
been paying off the loan on your house more quickly,
maybe hoping to pay it off in twenty years instead
of thirty years. Well, if you're fixed, mortgage rate is
low in the three percent range. Uh, and it should
(33:16):
be after the rates we've been experiencing. If you haven't
really financed in the last three years, you probably should
that would do it. Yes, but yeah, no, No. Debt obviously,
according to Matt and I is spectacularly awesome. Some debts
are better than others. But we don't really love any
of them. We don't. We just dislike some less, but
some that it just really is less egregious. Some of
(33:38):
it even borders on smarts. And your home mortgage is
one of those debts that we think should be a
low priority for you to pay off, especially with what's
currently happening right now. Right, just don't start spending the
money that you're putting towards the principle in order to
pay down that mortgage. Quicker we would say invested instead. So, yeah,
debt paid down is still something that you should prioritize,
(33:59):
especially if it's credit card debt or if it's high
interest rate debt, it's still is something we want you
to get rid of as quickly as possible. But if
you were, let's say, prioritizing pay down of a debt
that's got an astronomically low interest rate, well, in this
current inflationary environment, it makes less and less sense to
be paying down debt with that money, and it makes
more and more sense to continue to invest that money
(34:21):
to protect it more against inflation, because guess what, your
mortgage interest rate is far below the rate of inflation
is right now, So it's actually like an inflation hedge
to to hold on to that. Yeah, yeah, what better
hedge is there on inflation over the years than the
ability to you know, lock in a fixed expense, in
this case, your mortgage, while you can expect to earn
more with a higher income and with you know, higher
(34:42):
returns on money that you've got invested. You know, that's
that's exactly what happens when you buy a home on
a fixed rate mortgage, because I know that the payments
I make all my house and all my investment properties
aren't gonna go up at all over the next thirty years,
but our rent is going to be higher, like twenty
years from now, and you can all but guarantee that
rents are gonna be higher. Uh, and all the while
(35:04):
my payments that I make to the bank aren't going anywhere.
It's the exact same. Yeah, that's exactly right, Mad. Even
some of the rental properties you and I have had
for just over a decade, for like twelve years, those
those properties, like we've seen rents go up quite a
bit in that time period, and yet the monthly note
on that mortgage hasn't really changed all that much, with
the exception of tax increases, right right, That's why we
(35:26):
are huge fans of real estate investing. That's right. Yeah,
it's another another check mark in the in the box
of why real estate investing is great. But when it
comes down to it, Matt, like the you can't stop
the perpetual move of inflation, like none of us can
in the forward march of time. Yeah yeah, yeah, none
of us can turn back time like like share. But
the factors like causing inflation, they're just out of our hands,
(35:48):
like they're they're far beyond us. It's this it's this
world economic thing that that you and I don't have
any influence over than none of us do. And yes,
some periods of time we're gonna experience inflation happening more
rapidly like we are now. Other times we'll see a
more gradual increase of inflation. But your specific rate of
inflation it doesn't have to reflect the overall CPI numbers
(36:10):
that come out every month and the reports of increased inflation.
They don't have to change how we react, or we
don't even have to make any changes based on seeing them.
There are are certainly some folks who are more at
risk of inflationary shocks than others, but there are ways
for all of us to fight back and keep more
money in our pockets, even as things feel like they've
(36:31):
gone a bit haywire around us. And so what Matt
and I really want is is for us to not
freak out, to actually thrive in this inflationary cycle. And honestly,
even as the headlines have spelled doom and gloom for
everybody when it comes to losing more of our money
to inflation, if you have listened to the show and
if you have been taking the actions that we have
talked about for the last four years, and then we
will continue to talk about you. You should have done you.
(36:54):
We must have not incredibly well, because if you've been
investing your money in those widely diversified next one so
that we've talked about, you've crushed it. You've you have
far outpaced the rate of inflation. Your money is in
a good spot. And if you've been playing paying down
those high interest rate debts, you're in a good spot. Uh.
And so yeah, there there are small tweaks you can
make around the edges, but when it comes down to it,
(37:14):
the fundamentals that we talked about on the show all
the time still apply, and we'll continue to apply in perpetuity, exactly.
Man couldn't have said it better myself. Let's go ahead
now then and get back to the beer. On this episode,
you and I shared a chocolate pecan porter. And this
is my Tim Blore Brewing company out there in California. Joel,
we're your thoughts on this one, Okay. So I gotta
(37:35):
say I love pecans or pecans however you want to
say anything, I was gonna ask you if Okay, So
we had Thanksgiving was a few weeks ago. Pecome by?
Was that? Was that on the menu? Definitely had a
slice of course yes. And some people hate pecan pie,
like you either love it or hate it. I think
I like it, all right, I was like my favorite.
I mean, you can't beat a fresh, you know, hot
out of the oven apple pie. Yeah that's true. That's true.
(37:57):
Not super hot because you need it to set up
that way. It doesn't just like out onto your plate.
But if you wanted to sit up a little bit,
but like that, if it's like a little bit warmed
with some ice cream, I mean, you can't beat that,
all right. If you had to choose pecan or pumpkin,
what would you choose? Oh? I feel like pumpkin pie
is one of the divisive pies, like people either hate
or love that. I'm probably gonna have to give the
edge to pecan pie. Same here over pumpkin pie. But
(38:19):
I do love pumpkin pie. Okay, all right, Well you
like all the pies? I think I do. Well. Yeah,
when it came to this one, you know, I really
like pecans, and I thought this one had a nice
pecan presence in there. And I've never had like a
chocolate cover pecan. Although like all these cells to chocolate
covered almonds, which are delightful and delicious and should always
have someone hand to push it over to pecans maybe
(38:41):
that would be delicious, maybe because this Yeah, I really
like the vibe going on here. The nutty in the
chocolate uh inside of a porter was just yeah, really
well done, and so yeah, this one was really tasty.
I enjoyed it. Yeah. Yeah, this is one of those
reasons why a porter is fantastic because you get all
that flavor without having to like chew on your beer,
which is oftentimes what you get with a really big style,
which can be fun at times, but if you're just
(39:02):
looking to enjoy a nice dark beverage here in these
colder months, a quarter like this definitely hits the mark.
So a big thanks again to Ryan and our friends
out there at tim Blore Brewing Company uh for sending
us one our away. And you can actually find a
picture of this beer, plus any of the other resources
we may have mentioned during this episode, up on our
(39:22):
website at how to money dot com. No doubt, all right, Matt,
that's gonna do it for this episode. So until next time,
Best Friends Out, Best Friends Out,
Welcome to How the Money. I'm Joel and I am Matt.
Today we're asking the question, is inflation making us crazy? Inflation? Man,
(00:26):
it has been in the headlines, and so we felt
that it was time for us to devote an entire
episode to talking about inflation a little bit more. We're
gonna do that during this episode. Inflation has us living
la vida loca, I would say, Matt. Uh, So, here's
the thing. Speaking of inflation, I wanted to tell you
a little story about where do you go get gash nearby?
So I don't know, it just depends on Usually it's
(00:47):
when I'm just at Costco. I try to fill up
at costcocause it's always cheaper than But there are a
couple of places. It turns out. I used to think
that the Kroger. The Kroger has got to be the
most expensive place. So that's what I was gonna say,
is we used to always go to the local Kroger.
It's really close to our house. Um, and because occasionally
we go to Kroger for some groceries and we always
have some points where we get the discounted price per
(01:07):
gallon on gas. But recently I noticed that just a
gas station a BP just a mile down the road.
It was something like twenty cents cheaper per gallon. Uh.
And here's the thing, this isn't a gas station that
I have to go out of my way to reach.
This is on the way to Aldie. We've always said
it's cheap if you're gonna drive across town of the same,
but if it's easy to save, go save the money, exactly.
(01:27):
And so initially I noticed this a couple of months ago,
And initially I thought that maybe they had just not
raised their prices, because this is when price we were
seeing prices take up pretty significantly, pretty dramatically. Uh. But dude,
it has consistently stayed twenty cents at least twenty cents
cheaper than Kroger, uh than the shell further up the
road as well. And so I have changed. I mean,
this isn't a big deal, right, Like, you're only talking
(01:48):
twenty cents per gallon, and we don't even drive all
that much. The bottom line doesn't impact us all that much. No,
But I wanted to share the story because it takes
breaking out of the habits and the mindset that we
typically do think sometimes in order to save us money. Right,
So I think like when it comes to groceries, sometimes
we might think, oh, well, we always have to get
this product or or this cut of meat. This is
(02:08):
we always eat ribbies, you know, we always eat boneless,
skinless chicken, yes exactly, but instead to consider some of
the other options. Ever, we're more flexible. That can save
us in a big way. It also makes me think
about like cell phone service. I was just talking to
a buddy recently and he was like, yeah, I'm still
paying a lot of money for my Verizon service. And
I spent a good five minutes and he was interested,
(02:29):
and I wasn't just like brading it down the throat,
and I was explaining to him h M v n
o s, which are the mobile virtual network operators which
operate on the backbones on the networks of the major
you know, big names, but they charge you a fraction
of the cost. And so, for instance, you and I
were on Mint Mobile, right, and they operate off of
T Mobiles networks, and you get all the great speed
(02:50):
that comes with a T mobile, uh service, but at
a fraction of the cost exactly. But so many people
are just stuck in their ways paying the same phone
company the same amount of money every single month. And
and yeah, actually right now, like Mint has that three
by three months, get three months, three get three so
it like takes that super cheap phone service down to
an even lower price for those new customers. So yeah,
(03:13):
well we'll link that in the show notes. By the way,
people want to know about it. But Matt, let's move on.
Let's talk about the beer that we're having on this show.
This one is called Chocolate Pecan Porter. Do you say pecan? Pecan? Uh? Pecan? Okay? Wecan?
I think I did like a blending of it too,
like a hybrid. I had it in my mind. So
I grew up saying pecan because I was raised in
(03:35):
the South. Yes, but now I say pecan because I
live in the city. Now you're you're very refined. But yeah,
this one is by Tim Blore Brewing, and this one
was sent to us by listener Ryan, who works for
the brewery. So we're always always down for delicious craft beers. Ryan,
thanks for sending these ones to us. But Matt, let's
get onto the subject at hand. Let's talk about inflation.
(03:57):
Let's do it. And you know, it just kind of
made me think the other today, how how nutty the
conversation around inflation has gotten. Uh it, I don't know why.
It kind of made me reflect on one of my
friends who like a decade ago, ended up getting diagnosed
with prostate cancer. And yeah, tough diagnosis to receive, and
it was like obviously just an emotionally difficult time for him,
(04:18):
for his friends and family, everybody who was close to
him and who loved him. Um, but there's this belief,
I think when it comes to cancer that you gotta
go like harden fast in order to eradicate it, right,
that it's the fight against cancer exactly exactly, And so
there's this, Yeah, there's this belief that you gotta treat it,
you know, treaty quickly, and you gotta throw like all
the ammunition at it at once, exactly. And so yeah,
(04:41):
for unfortunately, my friend, he's doing really really well these days.
But that's actually largely because he took the opposite approach.
He decided not to throw the kitchen snake at this cancer.
He decided to do something called watchful waiting or it's
also known as active surveillance in the prostate cancer community,
basically keeping an eye on the growth rate of the
cancer and the potential symptoms, so that action can be
(05:03):
taken if need be, But the point the hope is
to not take action too soon because that could actually
greatly diminish the quality of life for the patient. That
surgery is obviously invasive, and you and I were obviously
we're not doctors, were not cancer experts. Recently, we did
an episode where we talked about I feel like we
talked a lot about dieting recently, and so what we're
(05:24):
definitely not nutritionists, we're not doctors either. It's just anecdotal
evidence to support something that we're gonna talk about this
outside like we'd like to dabble, right, But it's just
interesting to see how overreacting can actually create more problems
depending on the circumstance that you're going through, right, And
so in this case, reacting too quickly and having that
invasive surgery could have had other more consequential side effects,
(05:47):
and so waiting made the most sense. And you know what,
in over a decade, he hasn't had to have any
surgery and he's living a great life. And so yeah,
could the same be true when it comes to inflation
that maybe we're overreacting a little bit. That's kind of
what we want to talk about today. Yeah, that's right.
You know, it's understandable that many folks are starting to
worry about inflation. For the most part, it's been minimally impactful,
(06:09):
you know, for so long that most of us hardly
even remember that it exists. But that's all changed over
the past year due to a variety of factors. Right.
First of all, many of us have more cash in
our bank accounts due to stimulus payments, due to the
inability to spend our money like we normally would due
to COVID, so there's a ton of pent up demand.
And then on the supply side of the equation that
(06:30):
has also been massively disrupted and companies are having a
tough time catching up. Pandemic related shutdowns are still impacting
companies across the world. And so you combine all these
different factors, UH and inflation. It hasn't been as high
as it is currently for over thirty years. But the
question that we want to ask, though, is that should
we be concerned about it? Because you know, we we
don't want to read the headlines or watch the news
(06:52):
and then just react in drastic ways that are gonna
undermine our finances. Um And it turns out in a
recent poll we saw that of few well said that
they are very worried about inflation. And you know, all
these substantial levels of concern about inflation, they're actually starting
to concern us, concern you and me. Yeah, we're like, no,
there's just maybe too much talk about it. It's it's
(07:14):
gotten overblown, and it just seems like it's one of
those narratives that's spun out of control where we're all
talking about inflation and we're all like looking at it constantly.
We're looking for signs of relief or we're looking to
numbers to prove how bad it's gotten. Yeah, for political reasons. Yes,
sometimes it gets hyped up because folks have a different
agenda exactly. Yeah, And it feels like there's like some
(07:35):
sort of a psychological shift taking place in our brains collectively,
because in that same survey, forty percent of folks said
they plan to reduce their spending on restaurant meals and
on takeout, said they plan to skip upgrading their personal
technology devices. Folks said they're going to purchase less clothing
or delaying or canceling travel plans, and of folks said
(07:57):
they plan to drive less, a lot of changes. Yeah,
there's a lot of changes that people are making their
lives because of inflation. But yeah, holding off on purchases,
buying fewer things overall, that's a natural reaction to rising prices.
I get it, and those can be wise financial moves
no matter what's happening with the inflationary numbers, you know, anecdotally, Matt,
there was a post in the how to Money Facebook
(08:17):
group that I think it kind of echoes how a
lot of people are are feeling right now. A listener said,
should I be buying more stuff now because of the
fear that prices are gonna rise in the future. It's like,
should I should I frontload those things that they're on
my wish list? I was planning on holding off until
next year or till like, yeah, like fall of next year.
But I'm just worried it's gonna cost more now, so
(08:39):
should I jump in on that thing? I think that
question reflects another place that this inflationary environment can push
us towards. It can push us towards spending more money now,
even if maybe we don't have that money exactly. Yeah,
So but before that we talk about how to ensure
that rising costs inflation prognostications don't make you crazy. I
think it's really important to remind everyone at inflation is
(09:00):
just something that is always taking place in the background
of our economy. You know, most of the time, it's
it's something that we just don't even notice, you now,
even though it's still kind of humming along. It's sort
of like the sound of the like the compressor fan
on your fridge. Like, just because you get used to
it doesn't mean that it's not consistently chugging along, or
at least that it you know, it should be. That's
how your fridge days cold. And so just because inflation
(09:22):
isn't typically in the headlines, that doesn't mean that it's
you know, been sitting at zero up until now. If
if you look back at the data actually over the
last thirty years, the average consumer price index is two
point four percent. Like that is a real rate of inflation.
And so it's it's just important to keep that in
mind because they can often get discounted when inflation is
discussed today. Um, when when you see it in the headlines.
(09:44):
And I wanted to mention this too, because we're talking
about inflation right now, so aren't we a part of
the problem. But I just want to make it clear
that we've been talking about inflation way before it was cool.
We've been basically ever since we started talking about investing
on this show four years ago. Inflation was one of
the reasons that you should be investing. I will say,
we are always a part of the problem. Just that's
just generally how we roll. It's true we we like
(10:05):
to make trouble. But yes, I agree we we have
been talking about inflation every time we have to talk
about risk when it comes to investing, Inflation is the
thing that pops up, because that is the thing in
the background continually eating at your money if you don't
take the necessary risk of investing. There's a known quantity
of risk, and that is inflation. So it's important, the
sure and steady risk exactly. It comes up in every
(10:25):
conversation that we have about investing. It seems like in appropriately.
So so yeah, we're not trying to be fearmongers here
when it comes to inflation. I think, in fact, we're
trying to do the opposite with this conversation, and maybe
trying to tamp down the fears the people that people
have and and hopefully we'll all become a little less
crazy when it comes to how we think about inflation
and how we react to it. I think it's also
(10:46):
important to note that age likely plays a factor in
how you perceive inflation, because, yeah, even though inflation has
been like you said, Matt Humming in the background, it's
still significantly higher than what our generation has ever experience. Right,
Let's say you graduated from high school or college ten
years ago, and only then did you start paying attention
(11:07):
to prices, really, uh, except for maybe prices right with
your grandma on like a Tuesday afternoon when you were
out of school, Well, you only experienced inflation that was
an average of one point seven percent. So those prices
were taking up just incredibly slowly. And so many of
us have never experienced inflation like we're currently seeing it,
but our parents have. Right back in the seventies and eighties,
(11:30):
the average inflation rate was over six percent, kind of
similar to where we're at now. And so yeah, if
you wanted a mortgage back then, you were looking at
a thirty year fixed rates that were bumping up close
to eight per cent. So we just like live in
different financial times, and I do think age provides some
proper perspective, or at least knowing your history can provide
some proper perspective into that reality that inflation is always
(11:54):
at play in some form or fashion. Uh and that
rate of inflation just changes over time depending on other
circumstances happening in the economy and in the world. That's true, man,
I think it's in what you said to just what
we've experienced over the past decade is something that we
can't underestimate. Right. For a lot of us, we've never
experienced a bear market, We've never experienced rates of inflation
(12:14):
that have been this high. Like a lot of folks
came into their professional careers seeing a negative inflation rate.
And so it's really important to keep in mind our
own lived experiences and how that impacts how we interpret
the news and the headlines in our world. Yeah, exactly,
Like I became an investor in two thousand seven, and
uh so, you know kind of I certainly was an
(12:35):
investor while the market was having a moment, was having
you know, while we were going through a recession. But
I didn't have like a lump sum that took a
big hit, and so it didn't impact me in the
same way, uh that as it would have someone who
was twenty years older than me and had been investing
a whole lot longer. And speaking of just kind of
like your personal situation and how that impacts things, Matt,
(12:57):
there's actually a way too personally calculate eight the inflation
that you as an individual or seeing. We're going to
talk about that and getting to more about how you
should be reacting to what's happening when it comes to inflation.
Right after this, all right, we are back from the break.
(13:20):
We're talking about inflation, and it's true, prices are actually rising.
You know, we're seeing prices go up at the grocery store.
We're seeing at the gas pump at Kroger specifically, their
prices are really high, at least at the gas pump. Yeah. Uh,
Like houses and cars, like they are way more expensive
than they were just a year ago. And so across
the board we're seeing higher prices. But keep in mind
(13:41):
that that's just simply how inflation works, right, Like, this
is a part of progress and innovation, This is a
part of the growth of our economy. Uh, it would
actually be a bad sign if we saw prices dropping
and we were entering into a deflationary environment. That's actually
what we saw back in two thousand nine, Jewel, you
mentioned that right before the break, how we saw the
market tank than but we saw a deflationary environment. In
(14:04):
two thousand and nine, inflation was actually at negative point
four percent. Uh. And you probably don't need a reminder
how difficult it was to land a good job back then.
But the big question right now, though, is is inflation
something that you should be paying attention to? You know,
how concerned should you be? Uh? And like you said,
so much of this comes down to what exactly you
(14:25):
are buying, what you're spending your money on. That's right,
that's right. And yeah, we're seeing the headline number, the
actual percentage rate that is getting up in the high
single digits of where inflation is at right now, but
the overall rate of inflation. While it's it's good to know,
drilling down to see how inflation is actually impacting you
and your family is even more helpful, like seeing what
(14:47):
inflation is doing at a personal level. And obviously, if
you're a good budger, if you track your expense as well.
You can probably run the numbers like Matt, with how
much data you have about your own household spending. I'm
sure you could figure out that compared to last year,
exactly how much inflation is impact your finances. You can
probase you in like twenty minutes, right, that's true. Literally, well,
(15:07):
we were talking about something the other day and it
was something from like two thousand and eight, and I
was able to literally tell you how much I spent
on something because I was just like, well, let me
pull up the eight budget dot xls excel file and
I was able to nerd out and let you know
my numbers. It's quite impressive. Also, um, yeah, there's also
my dedication. Also, I need help just beyond the professional help. Yes,
(15:31):
but yeah. Interestingly enough, the Wall Street Journal has this
like inflation calculator that will link to, which can be
helpful if you don't have the numbers, the raw data
that Matt has, but you want to see how much
inflation is actually impacting you based on how you spend.
You can kind of plug some numbers in there. We'll
put that in our show notes. For instance, like if
you only have one car in that car is an
electric vehicle. Right. The fact that the massive run up
(15:53):
in fuel prices is a huge component in the overall
rate of inflation, well, that's not affecting you, So your
personal rate of inflation is going to be far lower. Also,
you know the run up in car prices, We've talked
about that on the show, Well, it's made up a
huge aspect of the increased inflation exactly. And if you
are like content with the one eight year old car
that you have or whatever, like you're not looking to
(16:15):
buy a new car, well, inflation is impacting you in
a much more minimal way. And so yeah, if you
really want to nerd out, you can check out the
Bureau of Labor Statistics CPI report, which will link to
in the show notes, which goes into a great deal,
almost as much detail as Matt's two thousand eight budget.
But I look at those reports and not totally heard out.
So yeah, it's it's it's interesting stuff. But it's also
(16:37):
important to note that those overall headline numbers are not
the necessarily the rate of inflation you are paying, and
your rate of inflation could be half of what you're
seeing as a headline number, or or maybe less, and
so kind of figuring out what it's looking like and
where it's actually impacting you is helpful. Yes, we share
all that to help you to realize how big or
how little of a deal this is going to have
(16:58):
on your finances. Uh. And dude, that's another whole side
of this too, is the fact that this is uh
an increase in prices, right, And so that means if
you are spending your money, like, there's a whole side
of our finances that don't have to do with spending.
And hopefully we see that decrease over time as we
tend to earn more money over our lifetimes, we'll see
the percentage of money that is going towards expenses. We'll
(17:19):
see that decrease as we increase our savings rate. Right,
But okay, let's talk about what to do. How you
can go about not freaking out about inflation because you
know the headlines they're not going to stop. And inflation
itself could be a more meaningful part of our lives,
and it's been over the past couple of decades. But
that doesn't mean that we have to yo yo back
and forth with every piece of inflation information that comes
(17:42):
our way. And so some of it starts with how
we consume news. This is uh one of these areas
where we feel that less can be more, especially if
your tendency is to freat more based on your news consumption,
and you know, along those lines, I think it can
be helpful if you are aware of some definitions, because yes,
we are dealing with higher inflation, but we're not talking
about hyper inflation, which means a rise in prices to
(18:04):
the tune of one thousand percent annually every single year here.
You know, we talked about that after Jack Dorsey tweet
a couple of months ago, the former CEO of Twitter,
And maybe that's why he stepped down, because I realized
he's like, I was a fool. I shouldn't have said that.
I can believe that tweet. Um. And you know, we're
also not dealing with stagflation. I feel like that's the
term we here thrown around occasionally because that's when you
see inflation coupled with slow economic growth and high unemployment,
(18:28):
both of which we've seen rebound significantly since the coronavirus
hit last spring. UH. So it's helpful to push back
against the fear of inflation just by knowing you know
what it is that we're actually living through, just by
having some definitions and to realize that we're not working
our way through regular inflation to these more exotic forms
of inflation or just I don't know, do you just
(18:49):
say inflation generally speaking as like the the broader concept
that is not what we're dealing with right now, Yeah,
for sure. And so yeah, knowing those definitions, knowing what
exactly we're do link with this is helpful. But there
are also some practical steps that we can take to
to fight back against inflation in our own lives and
and to make sure that it isn't, like we said,
(19:10):
slowly eroding the value of our money or as is
happening right now a little more quickly than it has
in the in the best in the previous a few years.
But we think it's important to fight fire with fire.
And then and then that evolves pushing for to make
more money, uh, pushing for a wage increase. Because of
the whack of doodle inflation that we're seeing these days,
(19:30):
it hasn't been easier in a long time to negotiate
a higher salary or extra perks, Like if you haven't
gotten a raise in quite some time, it's time for
you to ask your boss to see, like how much
more you can make. And if your employer is offering
a normal raise in that two to three percent range
that you're used to getting that cost of living adjustment,
(19:50):
you gotta push for more. That's just not going to
do it right now. And it's it's important to bring
your knowledge about inflation and what's happening right now to
these conversations and to push back and say, do you
realize that's actually that's not even a raise like that
you're not even allowing me to keep up with the
increasing costs of goods and services. And so, yeah, if
your employer isn't willing to budge on your pay, it's
(20:12):
time to do some digging in the job market to
see what sort of pay you can command elsewhere, and
you can use that as leverage in the negotiation process
or mosey on down the road to a new job
where you can get paid a decent chunk more. But yeah,
finding to make more money is a huge part of
how you actually push back against the way inflation is
impacting you and your own personal finances. That's rights another
(20:35):
way we can combat inflation is just simply by consuming less,
you know, remember the stats that we gave back at
the beginning of the episode. We'll purchasing fewer things overall,
and finding ways, you know, just to get the items
that you do need, either for free or for you know,
or for cheaper is something that we can always get behind,
but especially now, um, you know, and so that can
(20:55):
be as simple as just making dinner at home, brewing
your own coffee. Those are legitimate helpful ways to make
inflation hurt your bottom line in a smaller way. By
nothing groups. They are in an excellent place to find
things that you want that don't cost a time. Uh Facebook, Marketplace, eBay.
These are all great for buying used. Depending on the item,
we may not see inflation having as large of an
(21:15):
impact on the used marketplace, and so that's just an
effective way to stretch your dollar even more. Yeah, the
market for local goods in your community via sites like
Craigslist or Facebook, marketplace, you're going to in all likelihood, well, one,
you're just gonna save money buying used, right, Like, that's
one way to save money. But then on top of that,
you might see uh more imperfections in that market, and
(21:37):
so you might see someone selling an old couch or
something that depending on the age and the wear and
tear in the location and how you pick it up,
they're they're not charging as much as they potentially could be.
And so yeah, I think there there's just there are
more ways for you to save and to combat inflation
by buying used and by sticking to some of those
sites to buy more of the things that you might
have opted to buy new totally on your favorite internet
(21:59):
web site swap a offer up, like, there's all these
other apps as well that I mean, honestly, like you
and I, we don't use all that often because we're
trying to minimize what we're purchasing all together. But there
are a lot of different options out there for folks, yes, exactly,
And so yeah, another question Matt that comes up for
people is about stockpiling, like buying and consuming less stuff.
That's one way to decrease the impact of inflation, But
what about the opposite, what about what's known as kind
(22:22):
of pulling demand forward and so buying things that you
were attempting to hold off on, uh and saying you
know what, because of the fear I have about inflation,
because of the fact that this item is in all
likelihood going to cost more next month, or at least
that's my brain's assumption because I'm seeing all these headlines
about inflation. Should I buy that item now? And that's actually,
(22:44):
you know, when I refer to that listener on Facebook,
that's that's really what she was asking about. Does it
make sense to purchase something now assuming that the price
is going to go up? And I think the answer
to that depends on you know, what the item is,
whether or not you can afford it is a huge
is a huge piece of that. You know, don't go
into debt in order to secure a small purchase or
a medium sized purchase, because then you're paying interest on
(23:06):
that item, and that defeats the purpose of saving money
on the item. We can pretty much guarantee that the
interest that you're gonna pay on an item paying for
it with credit is going to be much higher than
the rate of inflation over the next year. Yeah. But
but if you have the cash and you're just accelerating
a bigger purchase because you want to ensure that you
lock in the price that it's at and you don't
want to pay more down the road, that's not a
(23:27):
terrible idea. We would just say, just don't let the
current inflation reality and then you know, future inflation concerns
get you too jumpy because that kind of leads to
a cycle for for all of us. If we're buying more,
consuming more, Uh, prices are going to go up at
a faster rate, and that leads to a more inflationary
environment in general. And it's just not good for your
(23:47):
personal financial situation to continue to push forward spending to
buy things sooner than you otherwise would just because of
inflationary fears. Yeah, it's kind of like options trading. I
feel like folks who like to stockpile and hoard might
all to overlap with those who might be interested in that.
But like, essentially this is kind of like the costco effect, right,
That is how a lot of folks are able to
get such a good deal at costco. Oftentimes it is
(24:09):
the price, but it's because of the quantity. Uh. And if,
of course, if you have a place to store all
of those items and you're not going to be tempted
to over consume those items, then it could be a
good deal for you. Because I think that's another way
that we have to be honest with ourselves, is are
you gonna be wasteful? Right? Like, just because you have
more of a certain product on hand, you need to
be honest with yourself. And uh like, are you going
to be more likely to burn through a bunch of
(24:32):
paper towels because you've got six rolls of paper towels
in your cabinet and it's kind of taken up a
bunch of space. Like it makes me think back to
I mean even now to a certain extent. I was
talking about gas at the beginning of the episode. But
when I'm getting close to the e you know, on
the on the gas cage, I tend to drive a
bit more gingerly, Like I I coast more. I I
don't floor it as often. But Dude, after I fill
that tank up, I'm like get in places quickly. It's like,
(24:55):
I think I am not wasting time because I know
that I've got a full tank. There's something like instinctually
human and about that when you have more resources, you're
just you're more wasteful. Exactly, when there's more money in
your bank account and it's not earmarked for something, you're
more likely to like say, screw it, I'm gonna buy
that thing now on a whim, even though you haven't
planned on it. Yeah, I I completely there's that psychological
(25:15):
component of having I don't know, excess resources, either in
your bank account or in your cabinet just depends if
you're talking about dry goods from costco or just money
in the bank. But we've got a few other ways
that we can combat and fight against inflation and its
impact on our finances. We'll touch on how investing can
help us to fight inflation. We'll get to all that
right after this break. All right, we'll back matt Let's
(25:45):
keep talking about inflation and how it's making us a
bit uh cuckoo for coco puffs? A bit crazy? Was that?
Did you uh eat cocoa pus As a kid, my
parents would rarely buy the name brand cereal? Matthew sentiment
to crunch for me, man all the way, Give me
like that one, a sugar cinnamon, like puffed rice whatever.
I'm still nostalgic for all those cereals like if are
we we never have them in our house. We never,
(26:07):
But if someone gave me a box, I would eat
the mess out of it, that's for sure. Like I
remember cinnamon to a scrunch back when they were still
serving it up, not in the plastic bag inside, but
when it was still like the foil bag. Remember the
foil bag. It was kind of like sticky around the top. Nice,
I'm getting old. It's a good throwback, all right. Well,
let's let's keep talking about inflation and how how to
come about it. And one of the main ways that
(26:29):
you can come about inflation in your life is to
plan and budget better. So yet, not only should you
consume less like we talked about to reduce the impact
of inflation, looking to buy used stuff like that, but
we also want you to pay special attention to your
budget and make changes accordingly. Like in a normal inflationary cycle, Uh,
you don't normally have to think as much about changes
(26:49):
to your budget. There there are small little tweaks you
can make in order to make sure that you kind
of make the numbers work. But as the numbers change,
as your grocery store run, or the amount you spend
on us every month doesn't stay the same as those
prices increase, there are some changes that we have to
make to our habits and to our behaviors in order
to kind of continue to live within our means. Uh,
(27:11):
But there's also a truth to there's only so much
that you can cut back, right, So you're gonna have
to adjust your budget to reflect the changing reality on
the ground. Because if you don't make any changes to
what you're buying and to the amount that you've budget
every month, if you're not changing things around and reallocating
your resources, chances that you're gonna go over budget just
are going up dramatically. That's right, And I mean and obviously,
(27:31):
like the most important thing about budgeting and tracking or
spending is to just to be able to have accurate information. Uh.
And so it's okay if that amount changes, right, Like,
that's that's not like throwing in the towel and admitting
defeat or anything like that. But the more accurate those
numbers are, the more helpful it will be when it
comes to you achieving some of the different financial goals
that you set for yourself. And it touches on, you know,
(27:51):
one of the different strategies that I have when it
comes to my spending when like we try not to
adjust how much we spend towards different categories from your
a year, because, like we said earlier, inflation does take place.
It is happening in the background, even when it's not
in the headlines, and if you are able to maintain
a certain level of spending, you are effectively spending less
(28:13):
every single year. Uh. And so that's kind of like
one of those little tricks where it's like, oh, my
gut's getting bigger, but I'm gonna keep the belts, you know,
on the same notch. It feels a little bit tight.
Eventually you get to a point to where you're like,
all right, this isn't it's either not accurate anymore, or
it's actually just impossible to actually contain the growth or
the money that you do want to spend. But again,
(28:34):
it's often about having accurate information, and when it comes
to your investment portfolio, you want to make sure that
you've you know, that you're aware of the impact that
higher prices uh will have on your nest egg, not
only on your expenses every month, like we just talked about,
but also on your retirements. You know, this is an
instance where it might make sense to be a little
bit more conservative. You know, this is especially true for retirees.
(28:56):
There's been the commonly dispensed four percent rule, which basically
states that retiree they should be able to draw down
four percent of their portfolio assets every single year. Uh.
And if they do that, they'll never outlive their money.
But the smart folks over at morning Star, they actually
just reassessed and say that it should be more like
a three point three percent draw down rate. Uh. So, yeah,
(29:18):
it changed that from point zero four to point zero
at three three. And that's based on an assumption that
equities are overvalued right now. Uh, and that bond rates
will remain low, And so being more conservative is going
to make sense in an environment like this. Yes, true, Matt.
But but while we're talking about investing, we would also
tell folks, tell our listeners, especially the younger ones who
(29:39):
have decades to grow their wealth, to not make massive
changes to their investment portfolio because they're worried about inflation.
Those are other headlines that you and I are seeing.
It's like how to inflation proof your portfolio. And we've
talked about this before. We did an episode about inflation.
I don't know, was it like eight ten months ago,
and we we talked about how stop are one of
(30:00):
the best places to put your money no matter the
inflationary environment, and a widely diversified portfolio made up of
mostly equities continues to be an excellent way to invest
your money even in this environment. So we would say
keep investing in the market each and every month, preferably
in those diversified index funds. And uh, Yeah, as we've seen,
this inflationary period has actually created more profitability for a
(30:23):
whole lot of companies. And so if you own a
small piece of the hundreds or thousands of companies in
that index fund, you stand to benefit. You're going to
see the amount in that retirement accounts continue to go up.
And so yeah, generally speaking, investing your money is the
most straightforward way to hedge against inflation. The more you
have in savings just sitting there in an account that's
(30:45):
getting eroded away, but the money that you have and
investments over time is going to healthily combat what's happening
with inflation. Yeah, you definitely don't want to have too
much money in your savings. Like obviously we like saving money,
but hoarding you know, just massive amounts, Uh, within an
inflationary environment like this means that your dollars are losing
their spending power more rapidly. You've got to be an
(31:07):
investor always, but especially now, don't put that emergency fund
money at risk in the market. But at the same time,
don't get too conservative and have just massive amounts of
money in your savings account. You want to put your
money that you don't need set aside in that emergency
fund to work, and you know, making small moves like
opting just to put some of your discretionary savings and
I bonds that can be a helpful inflation hedge. But
(31:29):
you don't want to make just these huge, massive overhauls
to your portfolio in an attempt to correct for those
higher inflation numbers. Yeah, it's tempting that, I think for
people to uh see us, to see one thing happening
and then to instinctively knee jerk make a reaction to
counterbalance what's happening in one space. And when inflation feels
(31:51):
out of control, you feel like you need to get
in control and and make a different move. But really,
the traditional way we've talked about investing uh it whole. Yes,
it remains true whether you're in a one and a
half percent inflationary environment or an eight percent inflationary environment,
it's still a great way to continue to invest your
money to continue to dollar cost average every two weeks
(32:11):
with your paycheck, or or just sticking to your investing
plan in general, investing as frequently as you like to do. Yeah,
I mean going back to your you know what you
said about your friend that had prostate cancer. It kind
of goes back to that. There's this mentality of feeling
like we got a mess with stuff. As as soon
as you hear something new or you hear something scary
like a cancer diagnosis, you think, okay, let's blast it.
But in reality that you know in his case that
(32:34):
wasn't what he needed to do, and in our case
when it comes to investing, and for a lot of people,
you don't need to do anything differently. You just keep
doing what you've been doing and ignore the headlines. Yeah,
it feels like it's action time, but in reality it's
time to like, I don't keep on doing what you've
been doing and take very little action. And let's talk
about debt to Matt, because that's that's a question that
comes up when people are hearing what's happening with inflation.
(32:56):
Should it change the way I'm like tackling or paying
off my debt? Well, that depends but in some ways.
Actually yes, with low interest right debt? Right, have you
been paying off the loan on your house more quickly,
maybe hoping to pay it off in twenty years instead
of thirty years. Well, if you're fixed, mortgage rate is
low in the three percent range. Uh, and it should
(33:16):
be after the rates we've been experiencing. If you haven't
really financed in the last three years, you probably should
that would do it. Yes, but yeah, no, No. Debt obviously,
according to Matt and I is spectacularly awesome. Some debts
are better than others. But we don't really love any
of them. We don't. We just dislike some less, but
some that it just really is less egregious. Some of
(33:38):
it even borders on smarts. And your home mortgage is
one of those debts that we think should be a
low priority for you to pay off, especially with what's
currently happening right now. Right, just don't start spending the
money that you're putting towards the principle in order to
pay down that mortgage. Quicker we would say invested instead. So, yeah,
debt paid down is still something that you should prioritize,
(33:59):
especially if it's credit card debt or if it's high
interest rate debt, it's still is something we want you
to get rid of as quickly as possible. But if
you were, let's say, prioritizing pay down of a debt
that's got an astronomically low interest rate, well, in this
current inflationary environment, it makes less and less sense to
be paying down debt with that money, and it makes
more and more sense to continue to invest that money
(34:21):
to protect it more against inflation, because guess what, your
mortgage interest rate is far below the rate of inflation
is right now, So it's actually like an inflation hedge
to to hold on to that. Yeah, yeah, what better
hedge is there on inflation over the years than the
ability to you know, lock in a fixed expense, in
this case, your mortgage, while you can expect to earn
more with a higher income and with you know, higher
(34:42):
returns on money that you've got invested. You know, that's
that's exactly what happens when you buy a home on
a fixed rate mortgage, because I know that the payments
I make all my house and all my investment properties
aren't gonna go up at all over the next thirty years,
but our rent is going to be higher, like twenty
years from now, and you can all but guarantee that
rents are gonna be higher. Uh, and all the while
(35:04):
my payments that I make to the bank aren't going anywhere.
It's the exact same. Yeah, that's exactly right, Mad. Even
some of the rental properties you and I have had
for just over a decade, for like twelve years, those
those properties, like we've seen rents go up quite a
bit in that time period, and yet the monthly note
on that mortgage hasn't really changed all that much, with
the exception of tax increases, right right, That's why we
(35:26):
are huge fans of real estate investing. That's right. Yeah,
it's another another check mark in the in the box
of why real estate investing is great. But when it
comes down to it, Matt, like the you can't stop
the perpetual move of inflation, like none of us can
in the forward march of time. Yeah yeah, yeah, none
of us can turn back time like like share. But
the factors like causing inflation, they're just out of our hands,
(35:48):
like they're they're far beyond us. It's this it's this
world economic thing that that you and I don't have
any influence over than none of us do. And yes,
some periods of time we're gonna experience inflation happening more
rapidly like we are now. Other times we'll see a
more gradual increase of inflation. But your specific rate of
inflation it doesn't have to reflect the overall CPI numbers
(36:10):
that come out every month and the reports of increased inflation.
They don't have to change how we react, or we
don't even have to make any changes based on seeing them.
There are are certainly some folks who are more at
risk of inflationary shocks than others, but there are ways
for all of us to fight back and keep more
money in our pockets, even as things feel like they've
(36:31):
gone a bit haywire around us. And so what Matt
and I really want is is for us to not
freak out, to actually thrive in this inflationary cycle. And honestly,
even as the headlines have spelled doom and gloom for
everybody when it comes to losing more of our money
to inflation, if you have listened to the show and
if you have been taking the actions that we have
talked about for the last four years, and then we
will continue to talk about you. You should have done you.
(36:54):
We must have not incredibly well, because if you've been
investing your money in those widely diversified next one so
that we've talked about, you've crushed it. You've you have
far outpaced the rate of inflation. Your money is in
a good spot. And if you've been playing paying down
those high interest rate debts, you're in a good spot. Uh.
And so yeah, there there are small tweaks you can
make around the edges, but when it comes down to it,
(37:14):
the fundamentals that we talked about on the show all
the time still apply, and we'll continue to apply in perpetuity, exactly.
Man couldn't have said it better myself. Let's go ahead
now then and get back to the beer. On this episode,
you and I shared a chocolate pecan porter. And this
is my Tim Blore Brewing company out there in California. Joel,
we're your thoughts on this one, Okay. So I gotta
(37:35):
say I love pecans or pecans however you want to
say anything, I was gonna ask you if Okay, So
we had Thanksgiving was a few weeks ago. Pecome by?
Was that? Was that on the menu? Definitely had a
slice of course yes. And some people hate pecan pie,
like you either love it or hate it. I think
I like it, all right, I was like my favorite.
I mean, you can't beat a fresh, you know, hot
out of the oven apple pie. Yeah that's true. That's true.
(37:57):
Not super hot because you need it to set up
that way. It doesn't just like out onto your plate.
But if you wanted to sit up a little bit,
but like that, if it's like a little bit warmed
with some ice cream, I mean, you can't beat that,
all right. If you had to choose pecan or pumpkin,
what would you choose? Oh? I feel like pumpkin pie
is one of the divisive pies, like people either hate
or love that. I'm probably gonna have to give the
edge to pecan pie. Same here over pumpkin pie. But
(38:19):
I do love pumpkin pie. Okay, all right, Well you
like all the pies? I think I do. Well. Yeah,
when it came to this one, you know, I really
like pecans, and I thought this one had a nice
pecan presence in there. And I've never had like a
chocolate cover pecan. Although like all these cells to chocolate
covered almonds, which are delightful and delicious and should always
have someone hand to push it over to pecans maybe
(38:41):
that would be delicious, maybe because this Yeah, I really
like the vibe going on here. The nutty in the
chocolate uh inside of a porter was just yeah, really
well done, and so yeah, this one was really tasty.
I enjoyed it. Yeah. Yeah, this is one of those
reasons why a porter is fantastic because you get all
that flavor without having to like chew on your beer,
which is oftentimes what you get with a really big style,
which can be fun at times, but if you're just
(39:02):
looking to enjoy a nice dark beverage here in these
colder months, a quarter like this definitely hits the mark.
So a big thanks again to Ryan and our friends
out there at tim Blore Brewing Company uh for sending
us one our away. And you can actually find a
picture of this beer, plus any of the other resources
we may have mentioned during this episode, up on our
(39:22):
website at how to money dot com. No doubt, all right, Matt,
that's gonna do it for this episode. So until next time,
Best Friends Out, Best Friends Out,
Hosts And Creators
Joel Larsgaard
Matthew Altmix
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