Ask HTM – Sinking Funds for BIG Purchases, PTO Advances, & Investing for Early Retirement #1054 - How to Money

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to Had of Money. I'm Joel I Matt. Today
we're answering your listener questions.

Speaker 2 (00:24):
Happy fall, everybody. Did you know it's officially follow Joel?

Speaker 1 (00:27):
Is it? It is my book?

Speaker 2 (00:28):
Actually, I don't technically know when the first day of followers,
we had many false falls where we live, Matt. That's
a constant in our neck of the woods. Everyone's like, ooh,
I felt a bit of chill in the air, then
to eighty degrees.

Speaker 1 (00:40):
Yeah. Yeah.

Speaker 2 (00:41):
Generally speaking, this is like the best time of year.

Speaker 1 (00:43):
Man.

Speaker 2 (00:43):
I love this time of years. Late in October, like
it is cooler, the mornings are crisp, man. I really
like Kay, I've been working out in the garage. I
really like opening the garage door. And when we get
out there in the mornings, it's a it's chilli kind
of wear a little white jacket while you warm up,
that kind of thing.

Speaker 1 (00:58):
But it feels nice, like he's the best.

Speaker 2 (01:00):
I love it re freshing.

Speaker 1 (01:01):
Although I will say in during the summer months, you
just know your wardrobe. For me, at least, it's like
shorts and a T shirt every day all day. I'm
still rocking shorts and a T shirt. Yeah, even when
it kids cold, right, okay, but like when I'm on
the bike with the kids in the morning, it gets
like it gets kind of cold, like when the air's whipping,
and so I'm like, all right, I guess am my
shorts and a jacket this morning.

Speaker 2 (01:19):
Or see, I'm still I'm still wearing I just like
having an airflow on the legs. Yeah, you know what
I'm saying, Like just something about the freedom there and
it's uh, it takes a really cold morning more it
takes a cold morning for me too. Want to switch
to some of the biking commuter pants, which also in
some of the nicer biking pants have like little vents,

(01:40):
especially for for folks who are on the bike all
the time. When you're riding. You want to have a
you want to be dry, you want to have that airflow.
I highly recommend for folks to check out you know
which ones I'm thinking about the chrome Oh yeah, they're
pants are great that have the vent event on the gussets.
Man down there in the seat of the commuter pants,
I'm sure so nice.

Speaker 1 (01:58):
I'm sure all the listeners are like, can we move
on to listen our questions now?

Speaker 2 (02:01):
They want to hear Joel talking about his crash. No,
we are gonna get to listener questions. A listener is
talking about how she can calculate fixed payments into her
savings rate. Another listener is wanting to make the smartest
moves with three hundred thousand dollars that he got his
hands on, specifically how that can fund his retirement. We're

(02:23):
gonna take a question about sinking funds, especially for quite
a large purchase, how to approach that and more. During
today's episode, Buddy.

Speaker 1 (02:32):
All right first kind of quickly mentioned a new fintech
app I came across, and I don't even know if
I want to name it, Matt, because I don't. It's
not a good one. Like, it's not something I like.
You've got PTO written down in our notes here. So
PTO paid time off?

Speaker 3 (02:46):
Right?

Speaker 2 (02:46):
The Father's a chance you're gonna deny me my PTO request.

Speaker 1 (02:49):
Oh yeah, yeah, No, you're not allowed to go formally
here on the air. I like to do it publicly.
So it changed you for even asking?

Speaker 2 (02:56):
Are listeners who've been listening to the show. I know
that that's not how I handle things. We do things
much more overlap casually around you you're.

Speaker 1 (03:04):
Trying to overlap, which typically we do that it means
when our kids are on break, right, But I think
that overlapping helps because both of us are going at
different times. Then it's like, really, be really so we coordinate,
but we don't.

Speaker 2 (03:15):
But also what I'm what I'm thinking about is the
fact that when you know in your own business, you
don't have to have a policy handbook that dictates.

Speaker 1 (03:24):
Although you're harassment.

Speaker 2 (03:26):
Really of a new policy anythink, Well, we'll talk about
that in our four thirty meeting, Joel, just kidding. We
don't have a four thirty meeting.

Speaker 1 (03:33):
Out there, now, we know, all right, So let's let's
talk about a PTO for a second, which is wonderful
paid time off. If you have a traditional job, you
do have to get to allocate a certain amount of time.
Although there are I guess more like they call them generous,
but I don't know how generous they are, like unlimited
PTO policies, because I think sometimes people are like, can
I really is it true? Like I don't think so
if I think I'm going to be shamed if I
take too much time off. But there is a fintech

(03:56):
company out there who says, hey, instead, if you're not
going to use that PTO, you might as well get
paid for it, and we will. Instead of waiting for
your an employer to pay you for your PTO, your
unused PTO down the road, we'll pay you now and
then you can pay us back. Of course, there's fees
assessed for this is terrible, the luxury of tapping the

(04:16):
value of your PTO early. So I think there's, like, man,
the early days of FinTechs, there were so many good FinTechs.
We're trying to solve real, actual problems that people based
in the personal finance space, and even.

Speaker 2 (04:28):
Something does not feel like a real problem, right, it
just seems like the last frontier of like, how else
can we get our fingers into your money? How can
we get you to leverage something that maybe you should
be leveraging or exactly that's exactly what you're getting an
advance on. And so I guess like the best thing
to do would be to just wait to get paid
for your PTO until you're at the point where you

(04:49):
haven't used it in your employer, like end of the year,
beginning of next year, when your employer's like, okay, cool,
you had eight days off or I don't know. Like
my father in law worked in a public school. He
basically had a full year of extra retirement because he
took so little time off, he had so many PTO
unused PTO days. The other option, Matt, is to take
all your PTO, which is something or fans of like,
take your time off, enjoy that, whether it's staycation, whether

(05:10):
it's traveling. I think this can be enticing people like,
let me gamify this even more. But I think there's
something to be said for taking the time off that
you're out heck, yeah, man, Well we need to do
it like the Europeans are doing it. Actually, we don't
need to do it like the Europeans because in a
lot of other countries they mandate it as opposed to
like it's like a national a nationally recognized mandated thing

(05:32):
as opposed to like, don't you love the fact that
people out there have the option to take their PTO
or if they're really trying to hustle and they're really
trying to get after it, man, I think the option
that they have to not take it is also pretty great.

Speaker 1 (05:45):
Yeah, I mean I like that people have the choice,
right and I think it's all about having the choice.
What I don't love is the reach of the long
arm of the FinTechs to say, let's find a way
that we get our grubby hands on some of your
PTO money, Like, Nah, that's that's your money, Like, you've
worked hard for that. Don't let somebody else take take
a chunk of it just because you want to access
to early. Totally agree.

Speaker 2 (06:06):
Man. The beer that you and I are going to
enjoy during this episode is called Presence of Another World,
which is this is a big old beer a ride
barrel aged out by Bissele Brothers, which is actually a
rare thing. I don't know if I've ever had a
stout by Bissele Brothers.

Speaker 1 (06:22):
I was thinking the exact same thing, only had ipation.

Speaker 2 (06:25):
They're known for their pails, I mean on the light end,
but yeah, typically IPA's double, IPA's all the hazes. So yeah,
looking forward to enjoying this one, sharing with you and
they will talk about it at the end.

Speaker 1 (06:35):
They do hazes so well, but can they pull off
a stout? We will let you know at the end
of the episode. Yeah, And if you have a question
you'd like to ask us on the show. We would
love to hear it. Just got to have the money
dot com slash ask for directions or just literally record
the question that you got on the voice memo app
of your phone. Send it our way how to money
pod at gmail dot com and make it a good one,

(06:56):
make it fun, make it entertaining. We'd love to take
it soon. Let's get to what I would say is
an entertaining question, Matt, about the nuance of saving traits.

Speaker 3 (07:05):
Hi, fellas, this is Katie thirty nine from Maryland, and
I had a twist on how to calculate saving percentages.
So everywhere you look, everybody kind of has a different
idea on how much you should be saving for retirement
compared to your income. But I receive a non insignificant

(07:28):
amount each month from my VA disability, and I was
just wondering how I would take that into account. Should
I add that amount.

Speaker 4 (07:35):
In with my annual income when I do my percentage
or since that will that entire amount will continue through
my retirement until I die, do I completely exclude that amount?
What would you guys do?

Speaker 3 (07:48):
All right? Thanks?

Speaker 2 (07:49):
All right, Katie, great question, And first off, you mentioned
your VA disability, so that means you were somehow injured
or had a condition maybe that was made worse your service.
So thank you for your service to our country.

Speaker 1 (08:03):
Thank you.

Speaker 2 (08:04):
But let's dive back into the old savings rate discussion, Joel,
I do.

Speaker 1 (08:08):
I do love these discussions. I know sometimes they get
a little lockier nerd. Sometimes I like one.

Speaker 2 (08:13):
Sometimes I like them, But yeah, I don't know if
if you are a personal finance nerd, it's fun to
crunch the numbers, calculate your percentages.

Speaker 1 (08:20):
Which tells like something you would do they get this
spreadsheet guy, you know, let's yeah, okay, I don't want
to get off track too soon.

Speaker 2 (08:25):
Let's let's specifically answer kating his question because like what
she is doing here by like she's asking, should I
include that? She's highlighting how slippery this argument around savings
rate can be because you can calculate it in so
many different ways. You can base it on. You can
base your savings rate on just your gross income. You'll,
let's narrow it down to even to your net income
after taxes. You can even incorporate your your net worth

(08:47):
growth into your savings rate. Basically the fact that your
money is now working for you so well, I should
count now too, shouldn't it right? Some folks do that.
I wouldn't recommend for you to do that one personally.

Speaker 1 (08:57):
That's not really what savings rate is giving after, And
I get there are a few different ways that you
can you can think about your savings right and like,
for instance, yeah, that last one you mentioned is reflective
of your wealth building efforts. But savings rate and net
worth are just two different things and they should be
measured differently. I think they're both worth tracking and growing,
but you don't want to necessarily like blur the lines

(09:18):
and include your net worth information into your savings right,
like they're just different things. There are also perpetual arguments
about whether to include investment dollars and savings dollars in
your savings right. I say yes, because you know you're
putting money into a high insure savings account. You're also

(09:39):
putting money into roth IRA or a four to one K.

Speaker 2 (09:41):
Yeah.

Speaker 1 (09:42):
I like the idea of all the above going into
the amount of money you're actually putting towards savings culture
you're not, yeah, using that money to spend. Same with
paying down principle on debt. I also think that should
be included in your savings rate. Not everyone agrees with that,
but you're not spending those dollars, and then once that
debts paid off, hopefully you continue to allocate the money

(10:02):
that you were using towards savings towards investments moving forward.
This just goes to show there's a lot of nuance
inside of it and teach to each their own really
different options as long as you're sticking to the same
metric and you're not maneuvering it to make it seem
like you're doing more than you are, and you're holding
yourself to the standard that you've set for what you
want to accomplish with general financial goals.

Speaker 2 (10:24):
Generally speaking, I think it's about consistency because, like to
the paying off debt argument, it's like, well, you're not
spending that money. Yeah, well you had spent that money,
so it's like old you previous you had spent that money.

Speaker 1 (10:35):
But what if you're continually racking up debts so you
can pay off the debt and that you know that,
you could get into this like circular reasoning logic where
then it doesn't really count a savings right. Yeah.

Speaker 2 (10:42):
Yeah, we're talking about her disability payment in a similar way.
You could even think of an employer match as being
part of your your savings, right, but we don't include
that because it is subject to change, whereas your disability
payment is not. This is this is sticking with you
for forever, and were you to start considering your employee

(11:03):
match as well, it takes the onus off you to
be ramping up your savings efforts. That's where looking at
your savings rate is just a good measure of your
behavior as opposed to like a specific dollar amount. But
generally speaking, we believe that the minimum savings rate goal
should be around fifteen percent of your gross income. But

(11:23):
it is really hard to make meaningful progress if you
are saving like let's say you're a fellow American, which
is less than five percent of your overall income.

Speaker 1 (11:32):
You're just trudging along in making a financial progress. It's
like one step forward, one step back. It feels like
if your savings rate is that low, right, like five
percent is just kind of insignificant. Is not going to
move the needle. But you're not gonna get peace out money.
You're not going to reach much financial independence, or it's
gonna take so long. You're gonna be working until you die.
But again, it also depends on how soon you start saving. Right, Like,

(11:53):
if this is something you started doing as a sixteen
year old, you started not only socking away money for
that first car and for that phone and for college,
but if you also had a designated no, this is
a you my retirement dollars. I literally have a friend
she started doing that when she was fifteen years old.
She started contributing. Her dad's a CPA, and so it's
not surprising that they knew about the Rathhire. They knew

(12:15):
about the glories of the wrathire Ry.

Speaker 2 (12:16):
But literally, at that young of an age, she started
contributing to her wrath and you know, she's doing pretty
well because of compounding.

Speaker 1 (12:24):
I think it does go to so many factors. Yea
many factors. If you frontload the sacrifice and you have
a higher savings rate in those early years, you can
maybe a five percent savings rate in your forties and fifties,
it's totally fine. Like your friend who started at fifteen, Hey,
I've been doing this for twenty five years and I've
been saving a big chunk of my money. Well, do
I need to always have a thirty percent savings right? No,

(12:44):
there's That's what like coast fire is all about.

Speaker 2 (12:47):
Right.

Speaker 1 (12:47):
It's like, hey, no, I've put in a lot of
the effort. I don't need to be saving it at
the same rate because I put all that effort in
early on. And I just think too, the reason savings
rate is so powerful is because there are other things
you can try to focus on in your finances, like, oh,
I'm gonna try to get higher returns than the average person. Well,
you don't have as much control over that, right, and
you actually might fall flat on your face, and an

(13:08):
attempt to pull that off. So much of your success
really hinges upon your savings right. So I do think
that is one of those key personal finance metrics you
want to be considerate of and to continue to look at.
And then so yeah, when you're talking about the VA
disability payment and including in your savings rate, I think yes,
Like we would of course include this in the income

(13:29):
section in the numerator of your calculation. If you make
let's say seventy five thousand bucks a year, but your
VA disability check is something like twenty five thousand dollars
a year for an overall amount of one hundred k,
and you save twenty five thousand dollars a year, your
effective savings rate is twenty five percent. And so while
you have more money at your disposal because of this

(13:51):
VA disability benefit, you've got more money to save. This also, though,
raises the stakes on how much you should be setting
aside to hit the metric that you want to hit
to hit the savings rate the year you're going after.
And it's not like a more money, more promised thing,
but it is just the fact that more money coming
in the greater necessity to save, which is why Matt,
every single year, as we're getting raises, right as we're

(14:13):
seeing our income go up, we have to be thoughtful
about how much we're contributing to savings and investments because
if we keep it the same, then we're not actually
hitting saving that same savings rate. And over the course
of a decade, let's say, if we're still saving the
same amount but not the same percentage, we're making less progress.

Speaker 2 (14:32):
Yeah, and I kind of touch on this a second
and ago, but the reason we would count your VA
disability check is because of the permanent nature of that
disability payment, right, so, unlike a match, this is going
to be recurring. This is going to be a reliable
stream of income and perpetuity, and like as opposed to
a match, I keep going back to a match because
I feel like it's just a great counter example, because

(14:53):
like we've seen many employers not offer a match, or
we've seen them reduce a match that they offer. If
you change obs the match, it might not be the same.
But within your case here, you've got this payment coming
in from the federal government every month, and so because
of that, I think including it in those calculations it
just gives you an accurate reflection of what you're doing
with the total amount of money that you have coming in.

(15:15):
And I think if you only included earned income doesn't
seem quite as thorough because it doesn't paint the whole
just like a full robust picture of what's going on
with your right with your finances. Yeah, okay, So I
feel like we've answered her specific question and now like
we can maybe go my tangent, which is I'm ready
like the even just the question of asking is like

(15:35):
what a savings rate should be. Sometimes I think like
just the different percentages can just get in the way
of the overall picture of what it is that we're
trying to achieve because sort of like you were saying,
if you were just to focus on a specific rate, well,
let's see, like twenty percent sitting aside twenty percent of
one hundred thousand dollars is a lot less than sitting
aside twenty percent of five hundred thousand dollars. And so

(15:58):
you're focusing on the income of things as opposed to
the whole purpose of why it is that you're socking
and setting money aside for retirement, which is to fund
your lifestyle. Which is why I think it's so important
to think about, well, what kind of lifestyle do you
want to live? Like what are your expenses going to be?
Because for somebody who has a very specific vision of
what those years might look like, it gives you something

(16:19):
very precise, I guess, to work towards, as opposed to
this open ended savings goal of like, oh, I've always
got to do twenty percent. Well you start asking why,
and you're like, well, that's what I need to be
able to do that. Like you ask yourself why like
five or six times, and eventually you'll get to the
point of it. Eventually you'll get to the point of
to where you're saying, well, it's because I want to
be able to do this, this and this and this.

(16:40):
They're like, okay, well maybe sort of like you said,
after twenty five years or so of doing this, you've
found that you're there, and then that then you're going
to be able to direct your funds in a more
value driven way as opposed to sort of being this
this sort of percentage goal. So that's that's the only
thing that I think, Katie, that I want to encourage
you to think through. And for other listeners out there too,
I do think the vast majority of Americans are not

(17:01):
setting aside enough and we need and we need to
encourage them to save more. But for folks who have
been at it for a while, I think it's worth
worth thinking through less of the open ended saving and
investing goals and more to the very pinpoint specific goals
that you might have for yourself.

Speaker 1 (17:15):
Yeah, and I think what you're getting at too is
you and I are talking to kind of some rare birds,
like who who are not the average American who are
not saving four point six percent of their income, who
are not in recurring credit card debt. Now, for the
most part, right there are certainly some listeners, especially new ones,
who are like, no, I really am, like that's where
I'm at, and that's great. We want to help you

(17:36):
out too. We want to speak to you as well, and.

Speaker 2 (17:37):
They need to buckle down do all the saving savings
they can. But yeah, for folks who have been But.

Speaker 1 (17:42):
If we're talking to people like who have been investing
since they were fifteen and they've been allocating a ridiculous
sum of money to like they have a really high
savings rate for a really long period of time, Yeah,
it's and you live incredibly frugally. Well, yeah, is your
goal to die with eight million dollars in your four
owing k in your IRA? If not, then you should, Yeah,
think long and hard about what your savings rate is,

(18:03):
what you're trying to accomplish. And yeah, dialing it back
could make sense for some people. Sounds crazy coming out
of the mouth of a personal finance podcast host, but
I think you're right.

Speaker 2 (18:13):
That's where money isn't necessarily goal. Your goals should be
the goal. Your lifestyle, the life you want to live,
those are the goals.

Speaker 1 (18:20):
I guess I'm just like so brainwashed into seeing how
poorly the average American handles money. And we do have
to broaden that out though, especially for our audience, who
is just more thoughtful and the.

Speaker 2 (18:31):
Average American out there for sure. But dude, we got
more to get to. We got more questions, including a
listener she's got a four to one k faux pa.
We'll get to that one and more right after this.

Speaker 1 (18:47):
All right, Matt, we're back. It's time. We got more
listener questions to get to. Let's take a question, yea,
we do. Let's take a question from listener Lance, who
did not say his name, so I'm saying his name, Lance,
who wants to know what he should be doing with
a big chunk of money.

Speaker 5 (19:01):
Hello, had a money team. I recently came into some
money a settlement. It's about three hundred thousand, and I
am fifty six years old, so I'm trying to look
forward to retirement, and I do have a couple retirement
accounts with my prior jobs. I am a renter and

(19:22):
always have been, and I have no bills or anything,
so I'm clear on that side, except a car insurance
and regular notes like that. But if you can lead
me down the path on where I probably should invest
this to help me with retirement in the next couple
of years.

Speaker 1 (19:43):
Thanks.

Speaker 2 (19:44):
So, the first thing I want to point out is
the fact that Lance said he's a proud I don't
think he said he was a proud renner, but he
said it like I'm a renter. I always have been
get up off me. Yeah, dude, don't criticize me.

Speaker 1 (19:56):
I'm all for That's. Yeah, that's one of those personal
finance myths that just won't die. And I don't know
if it's just the National Association of Realtors putting something
in the water in every municipality, like water source or
anything like that. I'm not accusing them of super nefarious
tactics like that.

Speaker 2 (20:13):
But like, I didn't know you've gotten into the it's
like Florid Matt the conspiracy theory.

Speaker 1 (20:19):
But I really do think where you get in your
health advice, bro, there's like all there's like this cultural
mythology around home ownership and how that's like the best
personal finance move you can make. You and I both
know when you look further into the data, yeah, it
can make sense. And so much of it depends on
when you're buying, what rates are, how much housing prices cost,
how long you're going to stay in the house, like

(20:39):
renting is not for dummies, and in fact, renters especially
now can do better. Oh yeah, saving and investing for
their future than a lot of homeowners. Absolutely yeah, home ownership.
The cost of home ownership, we also often underdiscussed how
bad those can be, how expensive.

Speaker 2 (20:55):
The additional costs. Yeah, but it does well. First of all, too,
he mentioned a settlement, So let's hope you are doing
okay and that whatever happened isn't keeping you from being
able to live your best life. But it also sounds
like you've been investing along the way, which is great.
You mentioned it sounded like multiple retirement accounts with employers
with jobs you've had over the years. But maybe you
don't have as much set aside over there as you

(21:18):
wish you did, or that you maybe you're just not
quite as comfortable as you perhaps envisioned you being at
this point in life.

Speaker 1 (21:25):
And this is the kind of realization that often happens
when you're in your mid fifties. You're like, wait a second,
how much have I been doing? Do I need to
ramp it up?

Speaker 2 (21:32):
You can kind of like nose of the grindstone, and
you look up and realize, oh, man, I actually, you know,
I want to retire soon. And for him specifically, I
think the settlement can be just a nice breeze to
the sales as he's cruising along here towards the end
of his his working career.

Speaker 1 (21:46):
Kind of maybe something you didn't plan on, but it
could be a way to make up for lost time.
Financially speaking, I also love that you don't have any debt, right,
which means you don't need to use this money to
pay off like student loans or credit card debt or
anything like that personal loans that are hanging out in
your past. That's nice, right, The fact that you've been debdiverse,

(22:06):
so you basically you can funnel all this money into
positive action for your medium term future, for your retirement needs.

Speaker 2 (22:14):
Yeah, that's awesome.

Speaker 1 (22:15):
Yeah, that's awesome.

Speaker 2 (22:16):
Is great to not have to worry about using some
like some of this or most of it or a
lot of it towards like kind of cleaning up previous
mistakes that you write it, you know, like, are you're
not sitting there kicking yourself and wishing that old Lance
would have done something smarter with with his money.

Speaker 1 (22:31):
And if you have like tons of debt you're like, man,
I wish I could get three hundred k in one
fell swoop to get rid of that and do positive stuff.
But still it's nice to be like I can do
only positive stuff with this, which rocks. I love it.
So let's talk about where this money should go, man,
I mean, I think first, make sure you keep enough
cash for short and medium term needs. That is just
the you know, three to six months emergency fund expenses. Next,

(22:54):
I would say a roth ira if you're income eligible,
and if you're making bank then you can need to
reconsider that, but I think you should be maxing that
out every year moving forward. It's just one of the
best and most flexible retirement accounts in existence. And if
you can max that out for a decade, you could
have six figures in a roth ira that you wouldn't
have had otherwise. And that's tax free money essentially that

(23:18):
you can tap in retirement, which is it's a nice
thing to have. And I'm not sure where you're working
or if you have a workplace retirement account anymore. You
didn't mention that in the question, but don't sleep on
that either, And that's just a way of course, especially
your age with ketchup contributions to be able to toss
a ton of money in every single year to really
max out your retirement savings efforts.

Speaker 2 (23:39):
Yeah, there are closing windows of time where you only
have the option to put money in those retirement accounts.
Now you can't go back in time. But beyond that,
taxable brokerage accounts that'll often make the most sense.

Speaker 1 (23:51):
Was that a share song?

Speaker 2 (23:51):
Though?

Speaker 1 (23:52):
If I could turn back time, are you sure?

Speaker 2 (23:54):
Or Fleetwood Mac? I don't know all those folks that
I never listened to, I couldn't tell you any of
they'll cut a together. Yeah, but make sure you've got
your brokerage with one of our low cost favorite providers
like Fidelity, Vanguard or Chuck Charles Schwab. But if you
invest most of this money, you will likely see it
double by the time you reach age sixty five, which

(24:18):
is pretty cool, right, Like you're turning that three hundred
thousand dollars into six hundred thousand dollars. It's kind of
like alchemy, but it's not compounding. But that in addition
to what you have in those other retirement accounts, it's
going to make a big difference in you being able
to live the life you want once you're able to
or once you're ready to stop working completely. You also
said in the next couple of years, Like literally you

(24:39):
said that, And I think it might be like if
you literally mean that you are planning to retire in
a couple of years.

Speaker 1 (24:46):
Couple is such an ethereal term. You're like, does that
mean two or eight? I don't know.

Speaker 2 (24:50):
Couple now, couple's two.

Speaker 1 (24:51):
Two is usually what people mean. My couple. Few is three.

Speaker 2 (24:54):
But I think many is beyond what's many.

Speaker 1 (24:57):
That's the thing fur plus. But I think sometimes people
use coup and they need it in a more generic sense.
And so it's I'm trying to read the read into this, yere.

Speaker 2 (25:05):
I'm going to take him out his word because so, like, literally,
what if he's saying I'm retiring in two years. If
that's the case, I would say that it might be
worth taking some of that cash and not investing it.
He's he directed us, right, he said, where can I
invest this money as I prepare for retirement in a.

Speaker 1 (25:21):
Couple of years?

Speaker 2 (25:22):
And so I think maybe we latch onto the first part. Oh, okay,
we're talking about investing here. But if literally you're talking
about maybe you know, kicking work to the curb in
a couple of years, like a little bit earlier than
when most folks are looking to retire, Like you actually
don't want to invest those dollars.

Speaker 1 (25:38):
Then again, and then again, you're talking about needing access
and needing to grow this money not just for boom
that retirement age, but for many many years in retirement.

Speaker 2 (25:46):
So maybe, like he's got to do the math. Maybe
sure target date.

Speaker 1 (25:49):
Fund could make sense for him that is kind of
honed into his specific retirement date.

Speaker 2 (25:57):
And again I'm not I'm personally not sticking money. If
I want money that I want to touch, that's like
in a couple of years, I'm not investing that money.

Speaker 1 (26:04):
No, but that's the thing, he's not going to touch
all this money, Like a lot of this money, even
though he's retiring, he's still going to be invested for
many decades from now.

Speaker 2 (26:10):
Yeah, I think, just something to consider.

Speaker 1 (26:12):
Because like you're not once you hit sixty five and
you're retired, you're not catching everything out.

Speaker 2 (26:16):
Of no, not all. It was also three hundred thousand.
I mean, I don't know what is what his annual
living expenses are, but if you want to have we've
already I mean you already you touched on like the
a fully funded emergency fund, emergency fund, and so that's
going to take up a big chunk of that. But
then you've got some like you're new, so boom, you
are siphoning up like I don't know, a third of
that could maybe as exactly just to an emergency fund.

(26:39):
But then beyond that you're looking at maybe I don't know,
a year's worth of actual living expenses to have liquid
to be able to deploy, So you might be looking
at sticking. What I'm saying is all three hundred of that, Yeah,
in I say a highyield savings account where you're pretty
much guaranteed by pretty dann close to four percent. Like
if it was me, I'm not sure if I would
take any risk knowing that I would that I would

(27:01):
want to tap that money early and maybe actually with
rates declining, maybe do CDs to guarantee like a higher
rate for a longer period of time. But I guess
it comes down to how dependent you are going to
be on that money. Yeah, I think what you're getting
that retirement, But if he's willing to work a little
bit and supplement his income, there's a whole lot more
options available on and then I would totally be willing

(27:23):
to invest.

Speaker 1 (27:24):
What you're getting at is like how crucial timeline is right,
And that's why for most listeners we talk about wealth building,
talk about wealth preservation, and Lance is just getting much
closer to wealth preservation. But I will say this too,
wealth preservation doesn't mean cash like only cash. There's still
a need to watch your portfolio grow over the many

(27:46):
decades that hopefully you're going to live in retirement. So
you have to be thoughtful about that balance of not
being too risky. I don't want to be one hundred
percent s and P five hundred fund or total stock
market fund. That would be insane if you're retiring in
two years. But you also want to be thoughtful about
not allowing not outliving your money and giving it a
chance to grow for the future as well. Like I

(28:07):
know some people who have retired and they're like they think, oh, great,
my retirement money, cash out, use it, and it's like no, no, no, no,
this is money that you built up is supposed to
last you for decades. That's the goal of it.

Speaker 2 (28:17):
Sure, yeah, yeah, so you said that it would be
insane if you are fully invested in the SMP. So
going back to I want to touch on retirement and
that actually because there's a whole lot of definite options
and definitions of what retirement could mean. Because for him,
maybe that means stepping away from his current work. But
that's why I think the ability to produce any sort
of income to cover some of his expenses. I think

(28:38):
that is so important because if he knows, well, no, no, no,
I'm still gonna work. I'm still going to generate some income.
I'm just gonna step down for my stressful. Yes, high
paying job, but stressful. I don't want to deal with
it anymore. And with that in mind, I'm going to
move to this other work that's going to provide a
whole lot of life fulfillment. It's going to cover my
living annual living expenses. Oh well, ude, if that's the case,

(29:00):
you're not touching this money like you're calling it retirement money.
But this is money you can just straight up invest.
You're not going to need it anytime soon. I think
the flexibility that comes with being able to generate some
additional income, if that's something that you want to do,
that also completely changes the game as to what it
is that you're invested in and what that potential timeline
time horizon might be.

Speaker 1 (29:21):
And I think also there's just a lot of unknowns here,
so we're trying to offer like a wide range of
potential answers because we're not one hundred percent sure exactly
what your timeline, your flexibility look like. And I think
given this large sum of money and the financial phase
of life you're in, you really might gain some insight
and peace of mind by talking to a financial advisor.
And so the stakes are just really high. Makes me

(29:43):
think of an interview I did not too long ago
with the couple from the Price of Bombacado Toast podcast
Matt and they had a I think a six hundred
thousand dollars settlement in their past, and they told the
story of blowing it over a series of years, and yeah,
they put some money into the Rothiray, but they bought
new Va and they did they did some ill advised
things too, And I think.

Speaker 2 (30:03):
Nice locations late out at some nice restaurant.

Speaker 1 (30:06):
I just don't want that to be the case for Lance,
and so I don't want you to fritter away this
sum of money. And so if you want to just
hire someone for a couple of hours of their time,
that could be just to bounce some proposals scenarios off
of them, or maybe even if you want an ongoing relationship,
I think that could be worth the money. So if
you think that maybe talking to a pro would would

(30:28):
help you out, we actually have a new page up
on the website how to money dot com slash advisor.
If you want to find somebody who fits the metrics
that we care about as far as what an advisor
values being a fiduciary and fee only and highly scrutinized,
you can go to how to money dot com slash
advisor to find someone that fits the bill.

Speaker 2 (30:48):
That's right, so Lance, we hope that helps, Man Joel.
Let's now hear from a listener who yes, she may
have committed a four KA, but she's also killing it
when it comes to saving for her retirement.

Speaker 6 (31:00):
Hi, man Joel, this is Morgan from Minneapolis, Minnesota. I
have a question regarding my four to one K. Last year,
I changed jobs around September. I had been consistently contributing
to my four to one K at my first employer
and continued to do so at my second employer. I
calculated my bi weekly contribution so that the total for
the year was the IRS max. However, I was twelve

(31:21):
dollars off. I had contributed twenty three thousand and twelve
dollars for the year. I looked into this a little
and all the advice I found states that the issue
needs to be fixed by April fifteenth of the following year.
I missed the state. So I'm wondering what I should do.
Since it's such a small amount. Should I withdraw the
twelve dollars and pay in early withdraw penalty? If so,

(31:41):
do I need to take out an extra couple of
dollars to account for any growth that occurred in twenty
twenty five. I know it's such a small amount, but
I don't want any documentation headache to follow me down
the road. Thanks so much. I really appreciate all of
the advice and knowledge you've shared throughout.

Speaker 1 (31:55):
The year, Matt. This kind of stuff frustrates me. I
realized that contribution I guess have to exist, and that
we have to pay attention to the details, But sometimes
the mechanisms I think for correcting basic, super small mistakes
can be frustrating. It can feel like you got to
spend hours to correct a twelve dollars mistake, which just

(32:16):
feels like a punch in the face. It's the pain
in the butt. Yeah, and you know, we've already got
the alphabet super retirement account things going on. We got
contribution limits we have to pay attention to. And then yeah,
like just if you over contribute by twelve bucks, it
can be it can be a little complicated to fix.
But Morgan, we'll do our best to help you out here.

Speaker 2 (32:35):
Yeah, yeah, not so great on the fact that you
over contributed. But before we get to that, like, let's
just focus on the good, which is the fact that
you've maxed out your four one K. Twenty three thousand,
five hundred dollars is so much money for this year.
Actually in next year it goes up one thousand bucks
to twenty four thousand, five hundred dollars. But kudos to
you for getting to the point where you are just

(32:55):
so excited and you are able to save big for
your future like that you are certain given future Morgan
incredible options.

Speaker 1 (33:03):
At her disposal.

Speaker 2 (33:04):
When you look at stats from vanguardel they found that
almost fifteen percent of folks are maxing out their workplace
retirement accounts, which was actually.

Speaker 1 (33:13):
More than I would have thought. It's actually yeah, And
is it just Vanguard customers, because that maybe makes more sense,
like that the Vanguard ILK are contributing more to their
retirem accounts. But I can't imagine the that's not fifteen
percent of the average American well overall at least.

Speaker 2 (33:26):
See that's the I think that's what's so difficult with
a snapshot of individual's finances when they say that, like, oh,
you know, like people aren't growing their incomes and like
the fact that everyone is dynamic and you move from
different savings rates and are you currently setting maxing setting
aside the maximum amount four or four one k?

Speaker 1 (33:43):
I don't know.

Speaker 2 (33:44):
It depends on what actually happened that year, right, Like
there might be plenty of years where you are, but
then some years where you aren't. There's just a whole
lot of variability as opposed to when you take a snapshot,
it freezes it in time. And that's I think some
of the problem behind some of the research and some
of the stats that get put out there, because it's like, well, actually, yeah,
I'm not maxing out my four one K but I
will be soon or one year I will be.

Speaker 1 (34:06):
I think I think it's exactly right. I think there's
a variable thing, a lot more dynamism than some of
those like static pictures tend to incorporate. And I agree.
I think there's just a ton of movement from different
income brackets, different savings rates, different contribution amounts from person
to person year over year. That just it's hard to digest.

(34:28):
And the way we like process information or the way
it gets presented. I'm curious what you would think, though,
if we were to do a poll of how to
money listeners, what percentage of how to money listeners do
you think, given this stat about Vanguard from Vanguard, what
percentage of how to money listeners do you think are
maxing out their workplace retirement account.

Speaker 2 (34:45):
I if the general public is that fifteen percent, I
would say we're at like twenty.

Speaker 1 (34:50):
Five to forty percent. Okay, yeah, I was going to
say third, so.

Speaker 2 (34:54):
I would Yeah, I would say that at least forty
to eighty percent want to be fully man and you know, yeah,
maxing out there their for one case. But yeah, there's
a difference between what you want to have happened and
which you are actually doing the right right.

Speaker 1 (35:07):
Well, it is really let's just be completely honest, that's
a ton of money, it's and it is a ton
of money for so much a lot of individuals, like
that's a third of their income. So it's really hard
to have a savings rate that high dedicated just towards
investing and not towards other financial goals that you have
as well. So we get that it's not like this
is the goal everybody should have because we realize it's

(35:28):
essentially impossible for a lot of people too. And by
the way, Morgan, you're not alone on this right where
you over contributed. This is this is a scenario that
people find themselves in when they contribute too much. Often
it is because they change jobs, which may they're getting
paid more. Now they're trying to like rerun the numbers
and it's more difficult to hit the nail exactly on
the head. Well, and a lot of time about percentages

(35:50):
of pay, which is like hard to zero on Y.

Speaker 2 (35:53):
And it's not like these amounts or these retirement fund
providers like they're not talking to each other on the
back end, right, as opposed to when you are in
your your employer's portal and you log into Vanguard.

Speaker 1 (36:04):
Or Fidelity or wherever you are.

Speaker 2 (36:06):
A lot of times are safeguards built in, like you
can't increase it to an amount where you are going
to set aside more from your paycheck that is going
to exceed the maximum contribution limit for that year. So
bouncing between jobs in particular is such a it's really tricky. Actually, Yeah,
for me personally, not having ever been employed, like more
traditionally employed.

Speaker 1 (36:27):
I got that one time for a little while.

Speaker 2 (36:28):
Yeah, but I'm sure as heck didn't have a four
K MAP. I guarantee that, man. But I've always taken
just a more kind of like cavalier approach to saving
for retirement, where it's just like I just tossed a
bunch of money in there because I've been self employed,
not because I've got a ton of money, but because
I've got full control over it as the employer and
as the employee being self employed, And so you can

(36:50):
kind of look at it towards the end of the
year and say, all right, how much more do I
have left? Or if it's just if you're just sitting
inside money in an IRA again, you're looking at van
Guard or fidelity or something like that, and you can
only put so much into whatever year it happens to be.

Speaker 1 (37:05):
Yeah, they're like, hey, actually, no.

Speaker 2 (37:07):
Yeah exactly, it's like more than number. What year would
you like to apply this to? And you've only got
two options until April fifteenth? And then they're like, oh no,
you only have one option, and actually you can only
add this much additional dollars. Yeah, it's not that's not
the case that Morgan found herself in because she's got
two different employers here, right, exactly the tricky spot, which
is why this happens, particularly to people who switch jobs

(37:28):
more often than not. And if you didn't fix it
in time, right, that's also not really a huge deal
because the stakes are low. Like if you'd contributed thousands
of dollars over the limit, you feel more financial pain
that the stakes will be raised, you might be a
little freaking out a little bit more.

Speaker 1 (37:42):
We're talking about twelve bucks, right, the cost of a
Chipotle meal, And yes, you should have paid tax on
the cost of that Chipotle meal. Is that what a
buriedo costs? I think? So, Okay, I don't typically eat
at Chipotle, but I hear it's good there's not a
been like once, there's not anyone.

Speaker 2 (37:56):
There's not one anywhere nearest.

Speaker 1 (37:57):
Right is there? If there was, I check it out,
probably would, But the problem is it becomes a manual process.
You have to file an amended return and you have
to count for that twelve dollars of additional income. That's
really the right way to proceed here. Yeah, which just
sounds like bringing a bazuka to a knight fight. It
just sounds ridiculous, but that is the proper way to

(38:19):
handle things. Yeah.

Speaker 2 (38:20):
I think what might be helpful in this case, as
we talk about it, is to kind of think through
the different scenarios where it would have been more ideal,
which is obviously in the first place, it would have
been the most ideal if she had hadn't over contributed,
but that's not the scenario she finds herself in. The
second most ideal scenario.

Speaker 1 (38:35):
Is if she wanted to a Dolorean at the speed
of what is it six eight miles an hour? I
don't know.

Speaker 2 (38:40):
I thought it was eighty.

Speaker 1 (38:41):
I think it was eighty eight.

Speaker 2 (38:43):
But in her case, she did over contribute, and so
ideally then you would make that correction before April fifteenth,
you have the ability to do that, and she was
talking about, well, like, well, what do I do with
that money? Like, what would happen is you would take
an excess of contribution disbursement, and by doing that, you
would pay income tax on that dollars from the previous year,
the year that you're filing your taxes, and then you

(39:03):
would pay.

Speaker 1 (39:04):
Tax on Sam wants is two dollars map.

Speaker 2 (39:06):
And then you would pay tax on any of the
earnings from that twelve dollars in the year that you
made the correction.

Speaker 1 (39:14):
So Sam wants is two dollars and eight cents Matt.

Speaker 2 (39:16):
But again, you didn't make this correction by April fifteenth,
and so in your case, what's going to happen effectively
here is that you're going to be taxed twice on
that twelve dollars because you didn't get it corrected in time,
and you can't withdraw.

Speaker 1 (39:29):
It as well.

Speaker 2 (39:30):
By the way you talked about taking past that point
that money out of that account, it stays in there.
And again, sort of like you're saying, Angel, this is
not an awful consequence. But if you if you never
remedy this and were you to get audited you could
owe back taxes, you could owe interest, and so yeah,
filing that imended return keeping notes on this moving forward,

(39:51):
I think would be prudent. That being said, this is
a very small amount of money, and I cannot imagine
a world that we would live in, Joel where the
IRS is coming after little old Morgan Morgan because of
the fact that she be misplaced twelve dollars from when
you're to the next when it came to a four.

Speaker 1 (40:06):
One king, I say, put her behind bars, Matt, But
that's just my personal political philosophy, So just kidding Morgan.
But yeah, rest easy, not a big deal. And I
just don't think Matt either this should. Sometimes people don't
want to run a foul of the RS. They don't
want to mess up, and even if it's in a
small incremental way, they don't want to make a mistake,
which I get. But I also don't want this to

(40:28):
prevent people from trying to seeking to maximize their retirement
account contributors because they might accidentally go slightly over. And
I just think that is the reverse problem is worse,
like being ready step to contribute as much as you
want to.

Speaker 2 (40:43):
Yeah, although I will say I think a good lesson
learned here is if you're in between employers, or if
you have two employees in one year, maybe take a
look at all your contributions for the year. And because
in case if you're like, all right, shoot, last few
paychecks actually need to end up completely so as to
completely avoid this for that year and then starting the
new year, it'll all be there under a single investing roof.

Speaker 1 (41:05):
Yeah, so to speak. And you don't have to be perfect,
Like you don't have to hit twenty three five hundred
right on the dot, but you can good enough is good,
Like I got twenty three two hundred in there. It's
like that's awesome, good job, So I will I would
still call that maxing outy.

Speaker 2 (41:18):
Yeah, yeah, exactly. You still get the you still get
the awards to get the gold star. Yeah.

Speaker 1 (41:23):
All right, We've got more money questions to get to,
including like sinking funds for vehicles. We'll talk about that
and credit repair right after this.

Speaker 2 (41:38):
All right, buddy, we are back from the break. It
is now time for the Facebook question of the week,
and this one is from David, who writes, how does
everyone save for their next car purchase? I currently shouldn't
need another car for a while, got a twenty seventeen
with ninety two thousand miles, twenty eighteen with ninety two
five hundred. But I would like to either pay cash
or put down a very large down payment. Basically, if

(42:01):
you had five plus years, do you just put your
quote unquote payment into a high yield account or do
you actually invest the money and then take it out
and pay some gains on it later. Joel, what would
you do?

Speaker 1 (42:12):
I gotta say love this goal of paying cash for
your next car because and this is the kind of
planning that it takes to get their math that most
people don't do. They're like, yeah, it would be nice,
But even while they're driving something new ish and their
payment has subsided, they don't know anything about it. They
just incorporate right that the money they would have spent

(42:33):
on that car payment back into their spending. They funnel
it somewhere else. They're not putting into savings specifically for
the next vehicle they will need at some point in
the future. Most people are just a little too short
sighted for that. And so David, you're a champ like
you are thinking about this right and your cars they're
both babies. I would say maybe they're like, they're not
even preteens. Math, they're very young. They're very young, and

(42:55):
so you should have many more years with these cars.

Speaker 2 (42:57):
They're about to be preteens. He's close to one hundred
thousand mark. You know, that's when threeteen ftattus.

Speaker 1 (43:02):
I don't know.

Speaker 2 (43:02):
It feels like when the acne kicks in. You're like,
oh man, now I got to leg go replace the
timing best. True, there's some more headaches, there's more close,
there's more drama involved in doing one hundred thousand plus
mile vehicle. That's all I'm saying, as.

Speaker 1 (43:12):
You and I well know at this point. But you know,
if you start saving for your next car purchase with hey, hey,
maybe if you're lucky you can wait till like twenty
thirty five. Let's say you wait a decade, you will
easily be able to pay cash without really having to
do it and stretch yourself out by saving too much.
I'm not sure what your other goals are and what
savings you have on hand, but you could start setting aside,

(43:33):
I don't know, like five hundred bucks a month, six
thousand bucks a year, which let's say you make it
eight years, not even ten before you have to place
those cars. That's forty eight thousand dollars in cash alone
that you saved very nice, and that's you know, depending
on your tasting cars, I think I could buy two
pretty nice.

Speaker 2 (43:48):
Ones, and that is actually before what you would earn
on that cash. If you would save it right straight
into savings, you'd have more than fifty four thousand dollars
at today savings rate. But let's run the numbers here.
Let's say you invested those dollars, you're looking at closer
to seventy thousand dollars depending on the specific rate of return,
which is far more than the cost of your average

(44:08):
used car these days. Granted this is off. In the future,
everything's gonna be more expensive most likely, But that being said,
I think these numbers will help you to aim properly.
And maybe you want to upgrade to a nicer car
when the time comes, or if you feel like you
need to replace it sooner, like let's say like in
five years instead of eight. We'll just run the numbers
with those parameters in mind, essentially kind of like back

(44:29):
into it, and you might need to make some adjustments.
Maybe you double your monthly savings to a thousand in
order to avoid taking on car debt in the future.
But either way, I think it's worth man, It's worth
saving more. It's worth lowering your expectations to never have
a car Loan. I think that is just it's just
a highly underrated personal finance move to not have a

(44:49):
car payment.

Speaker 1 (44:50):
I love the suggestion of lowering your expectations, Matt. I
think so many times people like Buck when they hear
that though, they're like, what do you mean? No, I
want what I want, man, And the truth is cool.
You can want what you want, it just comes with
there's an impact of that, right. So if the thing
you want is a brand new car and you can't
afford it, well, then that comes with debt, and that

(45:10):
comes with a lack of independence and choice in your life.
So what do you value more? And so, yeah, what
kind of car will make you happy? What can you
get by with? I think is a good question. The
medium household income is something like seventy thousand dollars, Matt,
and the average car payment is something like six hundred
and fifty dollars a month. That's not sustainable, Like, that's

(45:32):
more than ten percent of your income on one car.
In your driveway, which is crazy. It's a lot, yeah,
and it often just prevents people from being able to
reach the freedom they want to reach. The car in
their driveway, I think is a big, big part of it.
If you're doing all the other stuff, right, go ahead,
buy a nice car with the cash you've saved, but
not until then. And at the risk of sounding harsh,
I just think a car is not a fixed necessity.

(45:54):
I do think cars are more of an optional luxury.
And I am, oh, yeah, taking my own medicine over here, Matt.
I have the last two cars that I have personally
owned are We're both from two thousand and six. The
car I drive right now, it's in six, and I
love it. It's not vintage, it's not cool, but it
gets me where I need to go and I enjoy

(46:15):
driving in it. So I just think that could I
justify spending more money on a fancier car, Yeah, I could,
but I don't want to because I value other things
in life a whole lot more than the car this
in my driveway.

Speaker 2 (46:28):
That's right, buddy. Let's hear now from anonymous who writes,
anyone have experience with credit repair. I've been paying my
student loans religiously since twenty nineteen, but it was recently
transferred to a new loan servicer. My loan amount is
not too high, and I did not notice that the
auto payment was not transferred. They emailed me once during
this time, but I didn't see it. Three months later,

(46:48):
my bank notified me that my credit score had changed.
When I realized what had happened, I became current and
I set up the auto payment again. I called the
new loan servicer no help there, and submitted credit disputes
to the credit buer. I also submitted a CFPB complaint.
I've probably done everything that can be done, but I
wanted to check if someone else had a different experience
to make matters worse. I am in the middle of

(47:10):
a loan application and this came completely out of the blue. Yeah,
it felt like he just got kicked while he's down.

Speaker 1 (47:15):
That's a long time. Wrong time to have a credit
score glitch, right, is when you actually need to use it, because,
like I think Matt, most of the time, we're kind
of the credit score doesn't really have that much impact
in our lives until we needed to have a ton
of impact. Whether we're running an apartment or a house,
or or trying to buy a house, or trying to
buy a car and get a loan, that kind of stuff.

(47:37):
That's when, like the credit score matters a ton, and
it just sucks to have this glitch happen and not
notice it and then watch your credit score plummet. It
is a good reminder to check your accounts and your
credit card statements on a monthly basis. It's hard to say.
I think if the Consumer Financial Protection Bureau or the
credit bureaus are going to be able to help you
out on this front. I think it's worth asking, it's

(47:57):
worth barking up the tree. But you might have to
claw your score back up on your own after this mistake.
And the truth is, if this is like your sole
credit mistake, and you handle things properly moving forward, I
don't think it's It might be severe, but it shouldn't
be long lasting. That's right.

Speaker 2 (48:14):
But they asked about credit repair, which is not something
we would recommend. There are so many for profit companies
out there in that space, in the credit repair space,
that charge a lot to do things that you can
do on your own, sort of like what you've already done. Basically,
like you've disputed the items on your credit report. They
sometimes they can get something temporarily removed which boosts your

(48:36):
score for a bit and hopefully you're like, oh it worked.
Hopefully you don't see that as like I guess the
selling point. But these companies are never worth the time
of day or the money that you would fork over
to them. This is definitely something we would recommend to
DIY and honestly, continue to pay close attention to what
makes up your credit score, the basics here, the fundamentals,
and then do everything you can to write the ship,

(48:56):
continue to make all your payments on time, minimize your
credit utilization. But above all, I think you're just gonna
have to take take your time with it, like you
need to be patient. It takes time, but it is
better than you forking out the money and not getting
the results, which is.

Speaker 1 (49:11):
The alternative here. Yeah, it's like good money after bad
but it's like good money after credit score plumbt And yeah,
you don't want to do that. And if you really
feel like you need the help of a pro, you
can contact like a nonprofit like Money Management International or
the National Foundation for Credit Counseling. I hate that you're
currently trying to take out a loan. I know this
is making it harder to get the terms that you

(49:32):
want and that truly you deserve based on the way
that you've handled credit over a long period of time.
If this is for a house, it really is a
big deal and you're I don't know, maybe that's something
that you can talk with the loan officeerch or credit
union about. But if it's you know, and if it's
for a car, this could be a good thing. It
could prevent you from taking on more debt than you
probably should that you probably should be avoiding. So I

(49:53):
really do sympathize with this poster, Max. I know it's
frustrating to feel like one mistake sets you back on
the car at its score front. But I think this
is just a good warning for all of us because
the credit score it's important when we need it, and
we have to be paying attention to where our score
is at and monitoring to make sure that we're not
making small mistakes that lead to drops in that score. Yeah,

(50:16):
all right, Matt, let's mention. Let's get back to the
beer that we had on this episode. This was called
Presence of Another World from one of our favorite altheim
Brewers Bistle Brothers. You and I have both now been
to the source, the Meccha in Hey.

Speaker 2 (50:31):
You'll be happy to hear this was the last bottle
I have from thisstle.

Speaker 1 (50:35):
Brothers. Oh, you shared it with me. I drink.

Speaker 2 (50:37):
I drink all the rest because it's so good. So
because the others are IPAs and you want to drink those.
I'm so glad you shared this one when they are fresher.
But this is one that I thought, you know what,
I can hang on to this one for a while
and we can share this one.

Speaker 1 (50:48):
Well, I'm glad you shared this one for multiple reasons.
One because I never had a stout from them, and
this was it was really fun to see them try
a different style. It's legit. They did a great job.
And second, you know this is my favorite style of stouts.
This one has chili's in it, the cinnamon vanilla chili.
The Mexican stout takes it to the next level. Man,
it's aged in rye whiskey barrels. Sorry, this is hitting

(51:08):
all the notes from me. I'm in heaven.

Speaker 2 (51:10):
Yeah, the chilies are the first thing I noticed for sure,
Like you take a sip and you feel the tingliness
like it almost it almost felt felt like like Sejuan
peppers on your tongue a little bit.

Speaker 1 (51:19):
It's crazy, but it's the back of your throat just
a little. That's so good.

Speaker 2 (51:22):
And then it's got like the toasty, roasty body like
you get with like a rich cup of mocha, you know.
Or it's just and honestly like, as it warmed up,
that's when I started to pick up on more of
the cinnamon notes. Initially, I think it was more about
the peppers, but as it like physically warmed up, I
guess maybe my mouth warmed up too from the heat.
I don't know. I feel like I noticed a little

(51:43):
more of the spices, the cinnamon, but man, it was
so good. You can taste the boozy notes from the
barrels as well. Actually, there's a note on here it
said it was aged twelve months in Dad's hat Rye barrels.
I don't know who Dad's hat is, but I'm assuming
they make and Rye.

Speaker 1 (52:00):
Well, it makes me think a lot of the marketing
around beer is how you should drink it super cold,
and the truth is for great beers IPAs included, but
especially for great stouts. Let it warm up for a
little while. I set this out at least thirty minutes
before we started recording, because I knew that if you
drink this super super cold, you're not going to get
some of the flavor profiles, some of those notes that

(52:21):
you want to enjoy.

Speaker 2 (52:22):
It kind of flattens it out. You want to let
it blossom. Yeah, glad you and I got to share
this one.

Speaker 1 (52:27):
On the show today. Same here.

Speaker 2 (52:28):
We'll make sure to link to any resources we may
have mentioned during our conversation, and you can find this
up on the website at howtmoney dot com. Buddy, that's
going to be it. So until next time, Best friends Out,
Best Friends Out.

All Episodes

Ask HTM – Sinking Funds for BIG Purchases, PTO Advances, & Investing for Early Retirement #1054

Episode Transcript

Hosts And Creators

Joel Larsgaard

Matthew Altmix

Popular Podcasts

On Purpose with Jay Shetty

The Joe Rogan Experience

Stuff You Should Know

.css-15opob5{left:0;position:absolute;top:0.8rem;} All Episodes

.css-14f5ked{margin:0;word-break:break-word;display:-webkit-box;-webkit-box-orient:vertical;box-orient:vertical;-webkit-line-clamp:2;overflow:hidden;}Ask HTM – Sinking Funds for BIG Purchases, PTO Advances, & Investing for Early Retirement #1054