February 28, 2025 • 34 mins
Time for a Friday Flight- our little sampling of the week’s financial news and what it means for your personal finances. There are a lot of headlines out there, but we boil them down to specific takeaways that will allow you to kick off the weekend informed and help you to get ahead with your money. In this episode we explain some relevant and helpful stories like: renting the fancy clothes, lowest cost airports, the frequent flier switch, going abroad on a budget, secondary credit card benefits, referral bonus taxation, (not so) unlimited PTO, saving the most with health sharing, ghost tax preparers, DIY vs tax pros, brainless borrowing, updated Money Gear #1, and DOGE dividends.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to Hat of Money. I'm Joel, I'm Matt.
Speaker 2 (00:03):
Today we're talking about brainless borrowing, Doge dividends and abroad
on a budget.
Speaker 1 (00:27):
Doge dividends. Jiel, that's a headline that's like specifically written
for the Friday flight. Yes, because of the alliterations. Of course,
your favorite thing, that's what I do? Best man? What's
this thing about? Newly So? And you U l y right?
Speaker 2 (00:40):
So I thought this and this is a particular website company,
but there are other ones that do similar things apparently
like rent the runway or whatever. But you and I
a closed website. We haven't yeah, we haven't talked about
this actually on the show. But we got nominated for
an iHeart Podcast Award, the best in the Best Business
category best Business and Finance Podcasts, and we're probably gonna lose. Like,
(01:04):
let's be honest, there's.
Speaker 1 (01:05):
A chance we win. I mean, well, we're a one
out of five nominated, but there's I think a less
than twenty percent chance that we win, twenty chance of
us making it. I don't know, maybe.
Speaker 2 (01:14):
We're probably not, but so Emily, my wife and I
were like, let's go down for it. The awards are here,
in a little over a week. You sadly can't make it.
So if we do win, I'll be hoisting the trophy
alone without you, which will be sad. But again, we're
not winning, okay. So Emily's like, I need a fancy
dress for this occasion. We're going to like a podcast
(01:36):
award show, right, like, don't don't you walk down the
red carpet and you wear something nice?
Speaker 1 (01:40):
What am I gonna wear?
Speaker 2 (01:42):
And those kinds of dresses are I guess are typically
pretty expensive, and she's like, what why not just rent something?
And so we've never tried one of these websites before.
I don't know if guys do it or not. Like
I think my buddy Josh has done something called stitch
fix before, so I think some guys do rent close.
Speaker 1 (01:58):
Stitch Fix was like they send you a of clothes.
Maybe that's it. Maybe you keep it stitch fixed. I
don't know. I don't know how that works.
Speaker 2 (02:04):
But we looked into this into Newly and so she's
gonna get like like a six hundred dollars dress for
this occasion. You get like six pieces for like one
hundred bucks, and then you can.
Speaker 1 (02:15):
Cancel at any time.
Speaker 2 (02:16):
So it's one of those things where you're not obligated
to rent clothes from them for six months or a
year or anything like that. So especially for like a
special occasion, if you don't want to go fork over
big bucks for the nice dress for that when you
are you know, how often are these events actually occur?
Speaker 1 (02:30):
Right? It's kind of rare. So I mean you said
one hundred bucks and that still sounds pretty dang expensive.
It's just like, is it worth it though to spend
you know, I guess six times that in order to
get the six hundred dollars dress, and I think it might.
This is probably why it makes more sense for ladies
than it does for men, because with men's clothing and
fashion generally speaking, there's not a whole lot that changes, right,
Like you get yourself a good fitting tucks or suit
(02:52):
and you're gonna wear that thing for like twenty years.
Where it's just it is a little bit different when
it comes to the ladies. Well, I think is that
a part of the pink tax that I think get.
I think there's just different standards as to what's expected
of the ladies up and which is a bummer, Like
you might love the dress and hey, it's fun for this,
but do you want to wear it again? Right? Yeah?
I know.
Speaker 2 (03:12):
There's like a different thing about wearing the same dress
to fancy.
Speaker 1 (03:16):
If I was a if I was a lady, I
would get an awesome dress and I would wear it
to everything, Like to all these events. It's just like, oh,
there's Matt.
Speaker 2 (03:27):
Well, well you are who literally wears the same shirt
or the same outfit like six or seven days in
a row, that's.
Speaker 1 (03:34):
In the winter. I can because I maybe like you
wear the undershirt and like I'm like my outer button
up shirt. It doesn't get dirty. And so I literally
have the ability. I will literally wear a new fresh
shirt on Sunday, wear it all throughout the week, and
then by the time Friday rolls around and I'm like,
all right, it's trust. I have noticed it's starting to
get a little bit stale. It doesn't get stinky because again,
the shirts that touched the skin, you gotta those are
(03:57):
going straight to the hamp after one used socks, underwear,
T shirt. It's one use. This is what we're teaching
our kids. But everything I was like pants, you know,
pay she can get several days out of it. Shorts,
I know, it depends on the shorts, but maybe you
can get a couple of days out of that jacket.
In jackets, jeans like these are things that you rarely
need to wash, which is of course going to lengthen
(04:17):
the life of your clothing as well. But I think
that's fun though. That Emily is, she's getting all dolled up,
getting dressed up. And I didn't think. I didn't realize
it's gonna be like the Oscars, But I don't know
it is. We'll see. I have no idea what to expect,
but I think, you know, y'll show up and everyone
else is wearing like jeans and T shirts. That might
be the case. Hey, no young being overdressed. You know,
(04:37):
it's just like, sorry, we've got a gala after this.
We didn't dress up for this, We dress up for
the other thing. Okay, Yeah, I love it. I'll let
you know if we if we win, But if we win,
you need to FaceTime me live and I'll be like,
you know, like the little microphone. Well yeah, all right, buddy,
that'll be me, yeah, yelling through the phone.
Speaker 2 (04:57):
I look forward to it. All right, all right, let's
move on, mat, Let's get to Friday. Flight as sampling
stories we found interesting this week. Let's kick it off.
Let's talk about travel. If you want to fly for
less money, it's not all about finding the right discount
airline or snagging a sweet sale price. Like wait, I
think Southwest had a thirty percent off sale on certain
flights this week. I saw that, which is awesome. Yeah,
(05:18):
you might be able to fly for less right if
you find one of those sales. But it would also
be smart to fly or to attempt to fly from
the airports that offer the least expensive fares most regularly.
So to help us out here, the Bureau of Transportation Statistics,
they listed the lowest cost airports to embark from, and Matt,
(05:39):
I think we should name them right, because if you know,
let's do the airports that traditionally offer the lowest prices. Hey,
you might want to like start looking to see whether
you can find a flight from there, as opposed to
maybe the airport that's closest to your house. So Fort Lauderdale, Orlando.
So we got two Florida airports first off, but then Vegas,
Chicago and LaGuardia. Those are going to nab you the
(06:00):
lowest domestic fares on average dolls.
Speaker 1 (06:04):
In Washington, d C.
Speaker 2 (06:05):
That's the most expensive airport to fly from, and the
average price difference MATT between flights from Fort Lauderdale and
from the Washington Dollas Airport it's more than two hundred
dollars a ticket.
Speaker 1 (06:15):
That's pretty steep.
Speaker 2 (06:15):
So if you live in Washington, DC, it's not like
you're driving down to Fort Lauderdale right to save money
on your ticket. But I think this just goes to
show that if you only shop at the airport that's
nearest to you, you might be leaving out other potential
options to reduce the cost of your travel. So shop around,
set fair alerts, but also look to cheaper airports that
(06:37):
you might be able to reasonably fly from.
Speaker 1 (06:39):
Yeah, I noticed you said LaGuardia. Does everyone say La
Guardia or LaGuardia Guardia? Is it? Why is it Guardia
because it's spelled just the last name? Oh is that? Yeah?
I don't know who that is? Based after a former
New York City mayor, Charles Well because like the like
the way you spell guard like, you don't pronounce it
like Gouard to the base you say guard Okay, multation over.
(07:01):
So regarding the different regarding the different airports. What's so
fascinating too, is the fact that one of the biggest differences,
or one of the biggest reasons for the price discrepancy,
is because of competition. Yeah, and so specifically Dalls, Like
I was really fascinating. I'm like, why is it so
much more expensive? Is it because that's where all the
(07:21):
politicians fly into and they are priced in sensitive? Perhaps,
but it also has a lot to do with the
different airlines that service that airport, and there's a lot
of competition there. But specifically United Airlines has over seventy
percent market share. They basically have a stranglehold, which means
they can set the prices high and you don't have
many other options to get around that as opposed.
Speaker 2 (07:41):
To do you think Atlanta wasn't on that list? Yeah,
there's we got tons of different options. So no, no, no, no,
it wasn't on the list. Because Delta probably runs sixty
plus percent of the flights out of.
Speaker 1 (07:51):
UMAN compared to the most expensive list, we do have
a lot of options. But I was going to say,
guess the market share of United at Fort Lauderdale. So
at Dallas it's seven twenty percent. At Fort Lauderdale. Any guesses,
I'm I guess fifteen eight okay, eight percent, so and
that's much lower compared to I think the top three
where Spirit Jet Blue in Southwest, which sense like the
(08:14):
low cost affordable airlines provides that competition, and that's a
huge driving factor behind why there's such a price discrepancy
as well.
Speaker 2 (08:21):
And so when there is a major airline based out
of that city who runs, they kind of run the show.
They're going to have a lot more pricing power and
they can kind of keep some people out. I mean,
Southwest came to Atlanta a few years back, but they're
even talking about reducing flights. So I'm guessing the situation,
the pricing situation in coming to and from the Atlanta airport,
it's only going to get worse, like get a little
(08:42):
stiffer in the coming years. Okay, let's keep talking about travel, Matt.
As more airline frequent flyer programs have put the emphasis
on how much you spend versus how often you travel.
It's all about, you know, spending more money on tickets
instead of just flying regularly. Folks are opting to play
the field in attempts to save money, saying, ah, I
don't think I'm gonna book with the airline, and normally
(09:03):
I go with a particular airline because I'm used to
flying them. But people are saying I'm gonna be a
little less loyal moving forward. And we've always said that
being loyal to one brand or one airline it's a
bad idea because it's gonna cost you money. Right, But
even for normal people who only travel a few times
a year, some of those loyalty perks, like when combined
(09:23):
with let's say a proprietary credit card, they could result
in some pretty sweet benefits for travelers, potentially enough to
justify a higher ticket price. But I think those days
are coming to an end, and we are all for
loyalty in some areas of life, right, like friendship and love.
Like Matt, you and I were loyal to each other.
We're gonna be best friends, yeah, boy forever.
Speaker 1 (09:43):
But move over, Zach Braff and Donald Fason. We're better
than that. We're real friends. We're real, real friends. They're
real friends too, right, Evidently. Yeah, we haven't gotten that
T mobile commercial yet though, you know, Kate, I I've
debated watching Scrubs with the kids because it was one
of our favorite shows back in college. And every time
those T mobile commercials come on, they just totally crack up.
(10:05):
They think that they are so funny, and they are.
And Kate and I looked at each other, We're just like,
oh my gosh, they would so enjoy scrubs. I'm not
totally sure how appropriate that would be for a six
year old. That's a seven year old. That's a good question. Okay.
Speaker 2 (10:17):
So loyalty it's great in some areas, not great in others,
specifically when we're talking about airlines for most people. Right, So, yeah,
if you're in the position if you find that your
perks have diminished from the airline that you typically fly with,
but the price of your ticket hasn't and airfares are
going up, folks, look elsewhere. Google Flights is like the
proper place to start searching. Oh yeah, be more interested
(10:41):
in paying the least amount of money for the fair
as opposed to going with.
Speaker 1 (10:45):
The airline you're used to flying. Yeah, shopping around is
going to pay off, man. But on top of that,
every trip is on sale because of the current strength
of the dollar. Friend of the show Elaying Glusac, she
wrote about this over in The Times and she found
that a hotel room in Europe that costs two hundred
twenty four dollars last summer cost only two hundred and
eight dollars today. So it's not just that the dollar
(11:07):
is more competitive against the euro, but the Japanese yend
the Canadian dollar, they have also become weaker compared to
the to the US dollar. Basically because of favorable exchange rates.
Your money goes further in many overseas countries and destinations
right now, and so don't only think about the cost
of the flight in and of itself, granted that is
(11:28):
a huge part of the cost of afacation, but also
think about how much everything else is gonna cost during
your stay as well. Gives you the chance to go
abroad and maybe live a little bit beyond your not
beyond your means, but maybe just a slightly fancier trip
than maybe what you're used to. It feels like you're
living above your means because when you go over there,
you're like, wait a second, my money goes further. And
(11:49):
so it feels like with every purchase you make, or
or going out to eat or something like that, or
the hotel that you're paying for, it shall cost a
little bit less because it's a dollar strong. Yeah, it
feels like this is everything ten percent of what's feel
like exactly exactly exactly, which is pretty sweet feeling. Matt.
Speaker 2 (12:05):
Let's talk about credit cards. I see that article discussed
the secondary benefits of credit cards, and that's something that
we sing the praises of that. It's not just the
two percent cash back or the travel rewards, although those
are great. There are other benefits of credit cards as well,
you know, and some of them don't get touted all
that much, really, but they can be incredibly rewarding. And
(12:26):
so this author has seen that they got a new
battery for their iPhone without having and paying for Apple Care,
and that was thanks to the Chase Freedom Flex card
saved them ninety bucks because that's what it would have
cost otherwise. I think this is I just wanted to
use this as a reminder to tell people not to
sleep on the secondary benefits of that credit cards have
(12:46):
to offer. Like you can snag cell phone insurance or
no foreign transaction fees, or trip cancelation coverage or baggage
delay insurance or purchase production or a longer extended warranty.
There are just so many things that are under the
surface oftentimes that most people don't realize. You're like, oh,
I get the two percent cash back, or I'm getting
the five percent back when I when I pay for
gas and those things. That's awesome, Like I'm all for
(13:09):
those rewards. But then there are these other ones that
most people I think they just forget or they neglect
to think about, and they can be pretty rewarding too.
Speaker 1 (13:17):
I'll forget about the CDW man, the colision damage waiver.
Get that primary benefit that's stuff when you travel, and
that's so that's a massive if you travel at least
a week a year, you want that benefit that you
would use regularly as well as opposed to just when
things go poorly. Yeah, but I guess if you get
in direct things have gone poorly, but it's it's paying
for the insurance to make sure that you are covered
(13:38):
in case something like that were to happen. One of
the other benefits, too, is that those credit card credit
card rewards, they don't get taxed, which of course we're
thankful for. It's one of the only ways that we
can avoid the tax man. The thrift y traveler, they
had an article about this particular subject. And it's worth
mentioning that some kinds of credit card rewards actually will
result in taxation. You don't have to worry about your
(14:01):
sign up bonus that doesn't get taxed. It's treated as
a like a rebate essentially for your spending your two
percent cash back, your travel points. They're not gonna get
taxed either. But and this is news to me man
referral bonuses, they do get taxed. I didn't know this.
And so if you send your friend a link to
sign up for one of your favorite cards, if you
are one of those credit card optimizers out there and
(14:23):
you're trying to get everyone on board, just credit card
pusher slashy, you're also trying to like earner your own rewards,
you're gonna get it ten ninety nine for the bonus
that you receive if they sign up. And even if
the bonus came in the form of miles, you are
supposed to pay tax. So you know, I'm not totally
sure what the follow through rate is when it comes
to some of the different banks, but don't be surprised
(14:43):
if you receive a ten ninety nine in the mail
for that.
Speaker 2 (14:48):
Yeah, heads up, all right, Matt, let's talk about getting
paid from your employer and I getting paid. Yeah, sometimes
pay comes in the form of non monetary compensation, right.
We always talk about looking at your your total compensation
package when you're looking for a job, or you're trying
to assess the benefits of a job offer you have,
or even just like kind of thinking, well, how competitive
(15:09):
is the pay that I'm earning currently where I'm at
versus what maybe a friend or what other people in
the industry are earning somewhere else, somewhere down the street. Well,
the Wall Street Journal just wrote about why one perk
that looks great it really isn't, And that's unlimited vacation time.
This is something like that I feel like I've seen
popping up more and more as companies offering Hey, no, no, no,
(15:32):
it's not just two weeks of PTO. You can take
as much time off as you want. And that's kind
of the pitch. That's the cell from the company that
you can travel as frequently as you desire. But everyone
I've talked to, I don't know about you, Matt, who
has this benefit, they don't feel okay using it. So
(15:52):
this sounds like a great perk but in reality maybe
doesn't play out so well. That kind of the unspoken
rules dictate that you're not supposed to abuse your newfound freedom,
like the ability to travel as much as you want,
which I think actually causes people from what I can
from what I can tell, to take even less time
off than they're allowed. It's a sad reality. But I
(16:12):
would say, make sure to look this gift horse in
the mouth and ask about how this benefit functions in reality.
If you're applying for a job and the employer says, hey,
this is one of the perks we offer, I would
want to know more about how that actually works and
whether people actually take a significant amount of time off,
because we're always talking about how Americans don't taken off
their vacation time. If they have like a specific amount allotted,
(16:34):
they never take the full amount. We should all be
taken our vacation man, Like it's one of those perks
that we've earned that we deserve and all work and
no play makes us pretty dull too.
Speaker 1 (16:44):
Yeah, I totally agree. It feels like one of those
things where it's a benefit that like I don't even
know if this exists, but like it makes me think
if you go to like an arcade and it's just
like if you get this wrisk band, it's unlimited coke refills,
or like if you buy the special cup at a
gas station, it's like anytime you come in with your cup,
you just drink whatever you want. But the reality is
is how much are you actually how much soda are
(17:05):
you actually going to drink? And do you want to
drink an unlimited amount of coke? Like every time I'm
gonna drink till kidney failures. Kenny feels like something where
it's just like on paper, it seems appealing until you
actually start thinking through it and it's just like, well,
what's the actual reality of me taking full advantage of this?
And when it comes to time off, it's like, Okay,
are we talking about how great it would be to
take unlimited time off or maybe we just need to
(17:26):
actually take the time off based on a normal amount
of vacation days. And certainly it probably should be higher
in the US because we're such a work performance, productivity
driven culture. But I think that's something else to keep
in mind as well. Another typical perk that we not
we joel, but that most folks often get from their employer.
Our employers stage is health insurance. But as we're seeing
(17:47):
a rise in small business formation entrepreneurs, they got to
figure out how to get coverage without bankrupting themselves, which
is like the whole point of starting a business is
maybe for this to succeed. Vox they detailed the rise
of health sharing companies, not health care companies, but they
are growing quickly. These health sharing companies. Almost two million
(18:07):
Americans find themselves on one of these plans that look
like health insurance, but they have meaningful differences, and it's
basically the number of folks that are on these plants
have doubled in the past several in the past few years.
So look into them because they like there's significant savings
to be had, but do be careful, know the fine print,
(18:29):
know the exclusions. Juel and I we are both on
metas Share specifically they've worked well for us, but we
also haven't tested the limits, although some friends of ours have.
I think about some some good friends, and I think
it was literally the year after they joined on, she
ruptured or tore her achilles, and they were also like, well,
we were thinking about getting tonsils removed and adenoids as
(18:50):
well from like one of their whatever that is. I
don't know. I think it's in your mouth.
Speaker 2 (18:53):
Somewhere, your throat.
Speaker 1 (18:55):
But they did all of that within a year because
they were gonna they knew that they're going to hit
their what's called the annual household portion, and it worked
incredibly well for them, which was really encouraging because I'm like,
all right, I'm pretty sure this is going to work out.
And I think we'd even kind of steered them in
like that direction because they were paying an inordinate amount
of it was a little nervous. I'm just like, oh man,
(19:16):
how this works out. It worked out great for them.
I love the fact that more people are getting on this.
I was talking to a nurse friend a few days ago.
So she's a nurse, she works within the health care industry,
and I don't know how. We got to talking about
healthcare and I was I kind of sheepishly was like, yeah,
I don't know, I rarely go to the doctor. And
got to talking about health sharing. And you would expect
with her that she'd be on some sort of Cadillac
(19:38):
Premium Primo healthcare plus health Care Prime health account job,
but all the healthcare you can eat. She is on
a health sharing plan. Wow, because she's like, yeah, so
s thinking expensive, Like we don't even pay for the
kind of coverage that we often take at the hospital.
Blew my mind. But it's just evidence of the fact
that that's an area an industry that needs a little
(20:01):
bit of a reform, and I'm glad that there's competition.
Speaker 2 (20:03):
And not everyone can choose to go this routelet right,
We were like literally talking to a friend last night
who has a young daughter who has had cancer for many,
many years. They have a lot of employments they have
to go to. It gets really expensive, and so their
employment decisions are largely based around healthcare, which makes total
sense for them. But for other families like we have
(20:25):
been pretty fortunate on the healthcare front, and so we're
able to go opt for something like this in order
to reduce our out of pocket on a monthly basis,
and figures crossed that it saves us money over time
because we're just not shelling out as much for healthcare overall.
But again, this is a personal decision, and more Americans
(20:45):
are choosing some of these health sharing options because they
are saving the money. But the trade offs are a
crucial thing to take into account. All right, Map, We've
got more to get to on this episode, including where
you talk about some of the worst places to borrow money.
Borrowing money has gotten more expensive over the past couple
of years. We'll talk about that and whether or not
you're gonna get a five thousand dollars check in the
(21:06):
mail from the government right after this.
Speaker 1 (21:15):
All right, Joel, we are back from the break and
of course it is now time for the ludicrous headline
of the week. It's from c NETS. The headline reads,
is a tax prep service promising you a huge tax refund?
It could be a scam, Joel. We're sharing this one
because we want folks to know that if you have
a burning desire to get a massive, huge tax refund, well,
(21:36):
it can interfere with your decision making skills. It can
cause you to fall prey to what's being called a
ghost tax preparer. Yeah spooky, yeah Bay? Is it a
friendly ghost like Casper or friendly? So essentially, if a
so called tax preparer is highlighting how big of the
refund they can help you to get before knowing your specifics,
(21:57):
the alarm bells should be going off. The way it
works is that individual is going to then file your
return with fake deductions with credits that you don't actually
qualify for, and of course they're gonna then charge you
based on a percentage of your overall tax refund, so
they are incentivized to get as many deductions in their
ass possible. It raises how much you are going to
(22:18):
then pay them, but then your prepare disappears, you're left
cleaning up the mess. This is not the kind of
situation you want to find yourself in, and so if
you want tax help, we would recommend for you to
ask around to friends, ask for recommendations. Don't go rogue
on such an important hire like this as you're doing
your own homework. Make sure that the tax preparer has
a Prepare tax identification number. If they're trying to file
(22:42):
your taxes, prepare your taxes without having that, they're breaking
the law. That's also another red flag. Make sure that
they've got a physical address as opposed to just this. Oh,
they've got a website. They seem totally legit, but it's
pretty easy to up and vanish in the middle of
the night with a website versus having a physical off
as a physical location, and this is so nefarious.
Speaker 2 (23:03):
Matt because so many people they bank on that massive
refund every year. And if someone's kind of selling them
a bill of goods, like, hey, we'll get you the
bigger refund, like we have special tactics to score you
more money back.
Speaker 1 (23:15):
From the federal You want to leave money on the table.
Speaker 2 (23:17):
No, And that's so it sounds so promising, and you're like, well,
normally get like two grand, but this guy's saying I'm
gonna get like five or six. That is, you typically
want to walk down that road, except for in this
case it's totally false. You're gonna be in hot water
with the irs, which brings up the perpetual point of
contention come tax season, should you go tax software or
should you hire a tax pro and Kiplinger they did
(23:40):
a great job covering this. They basically suggested that software
is great for folks who take the standard deduction, who
only earn income as a W two employee, and who
only invest in traditional assets like stocks, and also for
folks who have lived in one state for the entire year.
So if you moved, you might want to hire somebody.
So if that's you, though, and you fall into all
(24:01):
those categories, use software like go with the free or
cheap options. Cash app in particular is still our favorite
because they're one hundred percent free for federal infrastate filing.
Speaker 1 (24:12):
What it used to be called before cash app bought it.
Speaker 2 (24:14):
It was credit credit car mattaxt credit. Yeah, and then
cash at bought it from them, and.
Speaker 1 (24:19):
It's continued to do an excellent job.
Speaker 2 (24:21):
Excellent job, and it's more robust than a lot of
the other free services, even the IRS Direct file service.
But let's say you don't meet all those requirements or
are you you know, you've got to come from another
source or you itemize your deductions, right, If you have
more complexity, it's often worth the cost to hire a
pro as long as they're not one of those ghost
prepares that I just talked about. Make sure they're a
(24:43):
legit tax prepare. They know what they're doing.
Speaker 1 (24:45):
So it's hard for me to hear you say ghosts
prepare it and not think of ghost peppers. Remember back
when ghost peppers were all the rage? No, when were
they all the rage? Like fifteen years ago, oh something
like that. That's like when all these like super hot
peppers started king. I hear ghosts prepare, I think ghost pets.
Uh huh, that's when that's the first time ever heard
of like the Skulville heat like that, which I know
about from Hot Ones, right, which I've never watched, actually
(25:08):
never seen an episode of Hot Ones. No. I mean, okay,
you got to watch the Conan O'Brien episode. It's insane.
That's funny. It's so funny, I guess, Okay, sounds entertaining.
I guess. I just think of folks who are like
going after the hottest pepper and it's like, oh, this
one because the ghost pepper used to be the hottest
and now there's other hybrids that they've come out with,
and it's like, well, this one's got two million Skulville
units or whatever. It's just not something I'm interested in
(25:29):
at some point. Humans, Uh, why would you want to
do that? To you? Just do it? And plus like
it makes me think about I want to eat like
a mildly hot peppers. Well, Joe, let's talk about debt,
because we are not debt and enthusiasts, but we're also
not debt haters to the core. Some types of debt,
when used wisely in moderation, we think can help you
(25:50):
to accelerate your different financial goals. We're talking about things
like a mortgage, maybe a small amount of student loans
to help you to get a degree, but specifically what
you are borrowing for and the interest rate attached to
that loan are going to be crucial factors when you're
trying to decide whether that debt product is bad, whether
it's neutral, or whether it's you know, a potentially decent investment.
(26:13):
And a new report from Solo, it's like a community
finance platform, first name Han, but they highlighted some of
the worst places to borrow and they're highlighting the negative
impact of short term loans that come with incredibly high
fees with high interest rates, subprime credit cards, payday loans,
and earned wage access that's like the different platforms and
(26:34):
apps that allow you to get paid early. They were
some of the worst culprits out there, and we totally
one hundred percent agree those are crappy products that should
be avoided at all costs. Man.
Speaker 2 (26:44):
We've talked smack about every single one of those at
some point, we hade them in the past, and yeah,
I think that earned wage access one matter, is particularly
nefarious because it looks so benevolent and those apps are
so good at marketing, they're so slick and then made
people think, oh, it.
Speaker 1 (27:00):
Looks like it's free.
Speaker 2 (27:01):
All I gotta do is is leave them a little
tip for the app creators. And when you factor in
how bad, how rotten that tip is from an interest
rate standpoint, it's awful and it's obliterating a reasonable chunk
of your pay that you shouldn't be forking over to somebody.
There's no you don't want to access your paycheck early
because it's going to cost you too much.
Speaker 1 (27:22):
It feels like a two point like a wolf payday
loan two point zero and cheap loathing.
Speaker 2 (27:28):
Essentially, it's just a modern slicker version of it that
looks less nefarious, but underneath the surface is rotten to
the core. They also mentioned in that report peer to
peer lending and by Now Pay Later as some of
the places people turn when they're in a financial pinch, right,
and those forms of debt can charge you sky high
interest if you don't make your payments on time. So
for by Now Pay Later, for instance, right, you might
(27:49):
find that the interest in fees are equivalent to a
forty five percent combined rate according to SOLO. If you're
not making your payments on time. So the macroeconomical is
that borrowing costs are up on every debt vehicle these days, right,
making every single form of debt more precarious, and the
worst kinds of debt have become even even worse right
(28:10):
over the past couple of years. A whole lot of
Americans are attracted to these forms of debt because they
have no savings to pay for an emergency man. I
think that's that's why people fall for these traps. They
feel like they have no other recourse. That's why we
talk about the emergency fund twenty four hundred and sixty
seven dollars, the bare minimum. Oh, you got to hit
that amounts. That's crucial to help you avoid needing to
(28:34):
turn to one of these really crummy debt vehicles that
could essentially bend you over a barrel for months or
years to come.
Speaker 1 (28:41):
Yeah, okay, so you know I love numbers, Joel. I
love counching the numbers. And we've been saying the two
four hundred and sixty seven dollars amount for a while.
Are you obtaining it for inflation? We have to agree
on this together. But doing a drum roll and a
big reveal. I just let me just talk to the numbers,
because the number numbers are fun. Raise your hand if
you love math. Everybody numbers like Shakira's hips don't lie.
(29:03):
So that Rep. Shakira, right, I don't know, I think so,
But that was based on research based back in twenty nineteen. Okay,
twenty nineteen is when we identified, oh, we need to
start recommending to everyone to have four hundred and sixty
seven dollars set aside. Guess what the the total inflation has,
what it's been since twenty nineteen. It's a total of
(29:24):
and he guesses, uh, I'm gonna go thirty two percent. Well,
not quite that that high twenty three point four to
five cent. So if you were to adjust two four
hundred and sixty seven dollars, if you were to update
that to take into account inflation since twenty nineteen, that
means today the new money gear number one initial emergency
(29:45):
fund should be three thousand and forty five dollars. Okay,
three thousand forty five. What do you think? Does that
have a good ring to it? It's is it as
good as two thousand and four and sixty seven?
Speaker 2 (29:54):
It doesn't roll off the tongue as much, but we
want to be accurate. Thirty forty five Yeah, okay, that
sounds better. Yeah that okay, all right, so maybe we
will update the site and start recommending for folks it's
thirty forty five that because that's a significantly larger amount
of money than I mean, this is solid more than
five hundred bucks.
Speaker 1 (30:10):
So just something to keep in mind. Okay, we mentioned
doge last week and the implications of DOGE on the
federal workforce. President Trump he has floated the idea of
sending a portion of the savings that Doge claws back
to Americans in the form of a direct payment. And
(30:31):
if you've read any articles on this, if you've seen
this talked about, you've seen like a five thousand dollars
number pretty early on. That kind of reminds me of
the early days of the stimu dollars. You know. Yeah,
eyes get bigger, mouth starts watering a little bit. You
start thinking you're gonna see a direct deposit in your account.
Speaker 2 (30:46):
Wait a second, how much am I getting? And you
kind of start pre spending it before it even drops.
Speaker 1 (30:50):
Unfortunately, because the precedent has been set. But the way
it works is some of the savings from DOGE would
help to pay down the federal debt, while twenty percent
could evidently flow to individuals. Sounds nice, but we don't
want folks to hold their breath. I think we are
unlikely to get a check for five thousand dollars in
the mailbox anytime soon. Oh yeah, I can't imagine what
(31:11):
that would do to inflation. And it just does not
seem very likely personally, right.
Speaker 2 (31:16):
No, it's it's one of those things where people are
gonna see headlines, they're gonna be like, cool, where's my
DOGE dividend, where's the check? When's it coming? And it's not.
It's not coming. Like, it's highly unlikely.
Speaker 1 (31:26):
I just don't see to be the bearer of bad news, right, Okay, Well,
I just can't believe that they floated this idea, that
they stuck it out there without I mean, it's just
how the current administration works. They're just constantly throwing ideas
out there. But when you know substance to back it up,
when you put something out there like this that folks
are like, that's something that they can wrap their heads around,
that's incredibly tangible. They've seen what that felt like in
(31:47):
the past, and if you don't deliver on that, folks
are going to be pissed.
Speaker 2 (31:50):
Honestly, it's kind of like the student loan forgiveness thing,
but I think this of this is actually being a
little bit worse because the student loan forgiveness thing was
they were attempting to do this and there might be
a legal way to pull this off, but ultimately there
were a lot of disappointed student loan borrowers at the
end of the day because that promise didn't come to fulfillment.
This is another one of those things where it's a
promise that's not going to happen, and that's because five
(32:12):
thousand dollars per household. Well that's the estimate based on
DOGE cutting two trillion dollars in federal spending. There's zero
sign that DOGE is going to find a way to
slash government spending anywhere near that level. Not that there
won't be some spending cuts around the margins that could
shrink the size of government a bit, but as we
said last week, entitlement programs would have to be significantly
(32:33):
altered in order to realize savings of that magnitude. Those
make up two thirds of the roughly seven trillion dollar budget,
and there's just no political will to touch those programs
in the slightest Like the President has basically said we
aren't going to cut back in any way, form or
fashion on those entitlement.
Speaker 1 (32:50):
Programs the campaign on that.
Speaker 2 (32:51):
So I think a five hundred dollars check, much less
a five thousand dollars check, is a pipe dream. Just
don't read that headline and assume that government money is
heading your way soon.
Speaker 1 (33:00):
Yeah, totally agree. Kind of it reminds me of like
so they also mentioned possibly floating the idea of a
gold card for folks who want to rich people from
over the US citizens, which sounds ridiculous, Like that's how
this the Doge dividends sound. It just kind of sounds ridiculous.
Catches all the headlines the gold cards. It sounds like
it's totally something Trump would do because it's gold, you know.
(33:22):
But I will say, once you start realizing that other
countries have incentives like this, it seems less ridiculous, Like
it just seems like some sort of pipe dream, like, Oh,
let's throw this up the wall and see what sticks.
You just assume that everything that the current administration is
doing is like completely ridiculous until you start seeing that, Oh,
other countries also incentivize investment and high net worth individuals
(33:43):
to move to their country for the good of the
overall country.
Speaker 2 (33:45):
Gold card thing seems less ridiculous, less ridiculous, Yeah, totally,
And it's you're incentivizing people to come to your country
who are hopefully going to be productive citizens. Yeah, invest
in the economy. But we'll see if it pants, will
see if that pants out here. All right, that's gonna
do it for this episode. We will post links to
some of the stories that we mentioned in today's Friday
(34:05):
Flight up on our website at Howtomoney dot com. Matt,
it's gonna do it for this one. Until next time.
Speaker 1 (34:10):
Best Friends Out, Best Friends Out,
Welcome to Hat of Money. I'm Joel, I'm Matt.
Speaker 2 (00:03):
Today we're talking about brainless borrowing, Doge dividends and abroad
on a budget.
Speaker 1 (00:27):
Doge dividends. Jiel, that's a headline that's like specifically written
for the Friday flight. Yes, because of the alliterations. Of course,
your favorite thing, that's what I do? Best man? What's
this thing about? Newly So? And you U l y right?
Speaker 2 (00:40):
So I thought this and this is a particular website company,
but there are other ones that do similar things apparently
like rent the runway or whatever. But you and I
a closed website. We haven't yeah, we haven't talked about
this actually on the show. But we got nominated for
an iHeart Podcast Award, the best in the Best Business
category best Business and Finance Podcasts, and we're probably gonna lose. Like,
(01:04):
let's be honest, there's.
Speaker 1 (01:05):
A chance we win. I mean, well, we're a one
out of five nominated, but there's I think a less
than twenty percent chance that we win, twenty chance of
us making it. I don't know, maybe.
Speaker 2 (01:14):
We're probably not, but so Emily, my wife and I
were like, let's go down for it. The awards are here,
in a little over a week. You sadly can't make it.
So if we do win, I'll be hoisting the trophy
alone without you, which will be sad. But again, we're
not winning, okay. So Emily's like, I need a fancy
dress for this occasion. We're going to like a podcast
(01:36):
award show, right, like, don't don't you walk down the
red carpet and you wear something nice?
Speaker 1 (01:40):
What am I gonna wear?
Speaker 2 (01:42):
And those kinds of dresses are I guess are typically
pretty expensive, and she's like, what why not just rent something?
And so we've never tried one of these websites before.
I don't know if guys do it or not. Like
I think my buddy Josh has done something called stitch
fix before, so I think some guys do rent close.
Speaker 1 (01:58):
Stitch Fix was like they send you a of clothes.
Maybe that's it. Maybe you keep it stitch fixed. I
don't know. I don't know how that works.
Speaker 2 (02:04):
But we looked into this into Newly and so she's
gonna get like like a six hundred dollars dress for
this occasion. You get like six pieces for like one
hundred bucks, and then you can.
Speaker 1 (02:15):
Cancel at any time.
Speaker 2 (02:16):
So it's one of those things where you're not obligated
to rent clothes from them for six months or a
year or anything like that. So especially for like a
special occasion, if you don't want to go fork over
big bucks for the nice dress for that when you
are you know, how often are these events actually occur?
Speaker 1 (02:30):
Right? It's kind of rare. So I mean you said
one hundred bucks and that still sounds pretty dang expensive.
It's just like, is it worth it though to spend
you know, I guess six times that in order to
get the six hundred dollars dress, and I think it might.
This is probably why it makes more sense for ladies
than it does for men, because with men's clothing and
fashion generally speaking, there's not a whole lot that changes, right,
Like you get yourself a good fitting tucks or suit
(02:52):
and you're gonna wear that thing for like twenty years.
Where it's just it is a little bit different when
it comes to the ladies. Well, I think is that
a part of the pink tax that I think get.
I think there's just different standards as to what's expected
of the ladies up and which is a bummer, Like
you might love the dress and hey, it's fun for this,
but do you want to wear it again? Right? Yeah?
I know.
Speaker 2 (03:12):
There's like a different thing about wearing the same dress
to fancy.
Speaker 1 (03:16):
If I was a if I was a lady, I
would get an awesome dress and I would wear it
to everything, Like to all these events. It's just like, oh,
there's Matt.
Speaker 2 (03:27):
Well, well you are who literally wears the same shirt
or the same outfit like six or seven days in
a row, that's.
Speaker 1 (03:34):
In the winter. I can because I maybe like you
wear the undershirt and like I'm like my outer button
up shirt. It doesn't get dirty. And so I literally
have the ability. I will literally wear a new fresh
shirt on Sunday, wear it all throughout the week, and
then by the time Friday rolls around and I'm like,
all right, it's trust. I have noticed it's starting to
get a little bit stale. It doesn't get stinky because again,
the shirts that touched the skin, you gotta those are
(03:57):
going straight to the hamp after one used socks, underwear,
T shirt. It's one use. This is what we're teaching
our kids. But everything I was like pants, you know,
pay she can get several days out of it. Shorts,
I know, it depends on the shorts, but maybe you
can get a couple of days out of that jacket.
In jackets, jeans like these are things that you rarely
need to wash, which is of course going to lengthen
(04:17):
the life of your clothing as well. But I think
that's fun though. That Emily is, she's getting all dolled up,
getting dressed up. And I didn't think. I didn't realize
it's gonna be like the Oscars, But I don't know
it is. We'll see. I have no idea what to expect,
but I think, you know, y'll show up and everyone
else is wearing like jeans and T shirts. That might
be the case. Hey, no young being overdressed. You know,
(04:37):
it's just like, sorry, we've got a gala after this.
We didn't dress up for this, We dress up for
the other thing. Okay, Yeah, I love it. I'll let
you know if we if we win, But if we win,
you need to FaceTime me live and I'll be like,
you know, like the little microphone. Well yeah, all right, buddy,
that'll be me, yeah, yelling through the phone.
Speaker 2 (04:57):
I look forward to it. All right, all right, let's
move on, mat, Let's get to Friday. Flight as sampling
stories we found interesting this week. Let's kick it off.
Let's talk about travel. If you want to fly for
less money, it's not all about finding the right discount
airline or snagging a sweet sale price. Like wait, I
think Southwest had a thirty percent off sale on certain
flights this week. I saw that, which is awesome. Yeah,
(05:18):
you might be able to fly for less right if
you find one of those sales. But it would also
be smart to fly or to attempt to fly from
the airports that offer the least expensive fares most regularly.
So to help us out here, the Bureau of Transportation Statistics,
they listed the lowest cost airports to embark from, and Matt,
(05:39):
I think we should name them right, because if you know,
let's do the airports that traditionally offer the lowest prices. Hey,
you might want to like start looking to see whether
you can find a flight from there, as opposed to
maybe the airport that's closest to your house. So Fort Lauderdale, Orlando.
So we got two Florida airports first off, but then Vegas,
Chicago and LaGuardia. Those are going to nab you the
(06:00):
lowest domestic fares on average dolls.
Speaker 1 (06:04):
In Washington, d C.
Speaker 2 (06:05):
That's the most expensive airport to fly from, and the
average price difference MATT between flights from Fort Lauderdale and
from the Washington Dollas Airport it's more than two hundred
dollars a ticket.
Speaker 1 (06:15):
That's pretty steep.
Speaker 2 (06:15):
So if you live in Washington, DC, it's not like
you're driving down to Fort Lauderdale right to save money
on your ticket. But I think this just goes to
show that if you only shop at the airport that's
nearest to you, you might be leaving out other potential
options to reduce the cost of your travel. So shop around,
set fair alerts, but also look to cheaper airports that
(06:37):
you might be able to reasonably fly from.
Speaker 1 (06:39):
Yeah, I noticed you said LaGuardia. Does everyone say La
Guardia or LaGuardia Guardia? Is it? Why is it Guardia
because it's spelled just the last name? Oh is that? Yeah?
I don't know who that is? Based after a former
New York City mayor, Charles Well because like the like
the way you spell guard like, you don't pronounce it
like Gouard to the base you say guard Okay, multation over.
(07:01):
So regarding the different regarding the different airports. What's so
fascinating too, is the fact that one of the biggest differences,
or one of the biggest reasons for the price discrepancy,
is because of competition. Yeah, and so specifically Dalls, Like
I was really fascinating. I'm like, why is it so
much more expensive? Is it because that's where all the
(07:21):
politicians fly into and they are priced in sensitive? Perhaps,
but it also has a lot to do with the
different airlines that service that airport, and there's a lot
of competition there. But specifically United Airlines has over seventy
percent market share. They basically have a stranglehold, which means
they can set the prices high and you don't have
many other options to get around that as opposed.
Speaker 2 (07:41):
To do you think Atlanta wasn't on that list? Yeah,
there's we got tons of different options. So no, no, no, no,
it wasn't on the list. Because Delta probably runs sixty
plus percent of the flights out of.
Speaker 1 (07:51):
UMAN compared to the most expensive list, we do have
a lot of options. But I was going to say,
guess the market share of United at Fort Lauderdale. So
at Dallas it's seven twenty percent. At Fort Lauderdale. Any guesses,
I'm I guess fifteen eight okay, eight percent, so and
that's much lower compared to I think the top three
where Spirit Jet Blue in Southwest, which sense like the
(08:14):
low cost affordable airlines provides that competition, and that's a
huge driving factor behind why there's such a price discrepancy
as well.
Speaker 2 (08:21):
And so when there is a major airline based out
of that city who runs, they kind of run the show.
They're going to have a lot more pricing power and
they can kind of keep some people out. I mean,
Southwest came to Atlanta a few years back, but they're
even talking about reducing flights. So I'm guessing the situation,
the pricing situation in coming to and from the Atlanta airport,
it's only going to get worse, like get a little
(08:42):
stiffer in the coming years. Okay, let's keep talking about travel, Matt.
As more airline frequent flyer programs have put the emphasis
on how much you spend versus how often you travel.
It's all about, you know, spending more money on tickets
instead of just flying regularly. Folks are opting to play
the field in attempts to save money, saying, ah, I
don't think I'm gonna book with the airline, and normally
(09:03):
I go with a particular airline because I'm used to
flying them. But people are saying I'm gonna be a
little less loyal moving forward. And we've always said that
being loyal to one brand or one airline it's a
bad idea because it's gonna cost you money. Right, But
even for normal people who only travel a few times
a year, some of those loyalty perks, like when combined
(09:23):
with let's say a proprietary credit card, they could result
in some pretty sweet benefits for travelers, potentially enough to
justify a higher ticket price. But I think those days
are coming to an end, and we are all for
loyalty in some areas of life, right, like friendship and love.
Like Matt, you and I were loyal to each other.
We're gonna be best friends, yeah, boy forever.
Speaker 1 (09:43):
But move over, Zach Braff and Donald Fason. We're better
than that. We're real friends. We're real, real friends. They're
real friends too, right, Evidently. Yeah, we haven't gotten that
T mobile commercial yet though, you know, Kate, I I've
debated watching Scrubs with the kids because it was one
of our favorite shows back in college. And every time
those T mobile commercials come on, they just totally crack up.
(10:05):
They think that they are so funny, and they are.
And Kate and I looked at each other, We're just like,
oh my gosh, they would so enjoy scrubs. I'm not
totally sure how appropriate that would be for a six
year old. That's a seven year old. That's a good question. Okay.
Speaker 2 (10:17):
So loyalty it's great in some areas, not great in others,
specifically when we're talking about airlines for most people. Right, So, yeah,
if you're in the position if you find that your
perks have diminished from the airline that you typically fly with,
but the price of your ticket hasn't and airfares are
going up, folks, look elsewhere. Google Flights is like the
proper place to start searching. Oh yeah, be more interested
(10:41):
in paying the least amount of money for the fair
as opposed to going with.
Speaker 1 (10:45):
The airline you're used to flying. Yeah, shopping around is
going to pay off, man. But on top of that,
every trip is on sale because of the current strength
of the dollar. Friend of the show Elaying Glusac, she
wrote about this over in The Times and she found
that a hotel room in Europe that costs two hundred
twenty four dollars last summer cost only two hundred and
eight dollars today. So it's not just that the dollar
(11:07):
is more competitive against the euro, but the Japanese yend
the Canadian dollar, they have also become weaker compared to
the to the US dollar. Basically because of favorable exchange rates.
Your money goes further in many overseas countries and destinations
right now, and so don't only think about the cost
of the flight in and of itself, granted that is
(11:28):
a huge part of the cost of afacation, but also
think about how much everything else is gonna cost during
your stay as well. Gives you the chance to go
abroad and maybe live a little bit beyond your not
beyond your means, but maybe just a slightly fancier trip
than maybe what you're used to. It feels like you're
living above your means because when you go over there,
you're like, wait a second, my money goes further. And
(11:49):
so it feels like with every purchase you make, or
or going out to eat or something like that, or
the hotel that you're paying for, it shall cost a
little bit less because it's a dollar strong. Yeah, it
feels like this is everything ten percent of what's feel
like exactly exactly exactly, which is pretty sweet feeling. Matt.
Speaker 2 (12:05):
Let's talk about credit cards. I see that article discussed
the secondary benefits of credit cards, and that's something that
we sing the praises of that. It's not just the
two percent cash back or the travel rewards, although those
are great. There are other benefits of credit cards as well,
you know, and some of them don't get touted all
that much, really, but they can be incredibly rewarding. And
(12:26):
so this author has seen that they got a new
battery for their iPhone without having and paying for Apple Care,
and that was thanks to the Chase Freedom Flex card
saved them ninety bucks because that's what it would have
cost otherwise. I think this is I just wanted to
use this as a reminder to tell people not to
sleep on the secondary benefits of that credit cards have
(12:46):
to offer. Like you can snag cell phone insurance or
no foreign transaction fees, or trip cancelation coverage or baggage
delay insurance or purchase production or a longer extended warranty.
There are just so many things that are under the
surface oftentimes that most people don't realize. You're like, oh,
I get the two percent cash back, or I'm getting
the five percent back when I when I pay for
gas and those things. That's awesome, Like I'm all for
(13:09):
those rewards. But then there are these other ones that
most people I think they just forget or they neglect
to think about, and they can be pretty rewarding too.
Speaker 1 (13:17):
I'll forget about the CDW man, the colision damage waiver.
Get that primary benefit that's stuff when you travel, and
that's so that's a massive if you travel at least
a week a year, you want that benefit that you
would use regularly as well as opposed to just when
things go poorly. Yeah, but I guess if you get
in direct things have gone poorly, but it's it's paying
for the insurance to make sure that you are covered
(13:38):
in case something like that were to happen. One of
the other benefits, too, is that those credit card credit
card rewards, they don't get taxed, which of course we're
thankful for. It's one of the only ways that we
can avoid the tax man. The thrift y traveler, they
had an article about this particular subject. And it's worth
mentioning that some kinds of credit card rewards actually will
result in taxation. You don't have to worry about your
(14:01):
sign up bonus that doesn't get taxed. It's treated as
a like a rebate essentially for your spending your two
percent cash back, your travel points. They're not gonna get
taxed either. But and this is news to me man
referral bonuses, they do get taxed. I didn't know this.
And so if you send your friend a link to
sign up for one of your favorite cards, if you
are one of those credit card optimizers out there and
(14:23):
you're trying to get everyone on board, just credit card
pusher slashy, you're also trying to like earner your own rewards,
you're gonna get it ten ninety nine for the bonus
that you receive if they sign up. And even if
the bonus came in the form of miles, you are
supposed to pay tax. So you know, I'm not totally
sure what the follow through rate is when it comes
to some of the different banks, but don't be surprised
(14:43):
if you receive a ten ninety nine in the mail
for that.
Speaker 2 (14:48):
Yeah, heads up, all right, Matt, let's talk about getting
paid from your employer and I getting paid. Yeah, sometimes
pay comes in the form of non monetary compensation, right.
We always talk about looking at your your total compensation
package when you're looking for a job, or you're trying
to assess the benefits of a job offer you have,
or even just like kind of thinking, well, how competitive
(15:09):
is the pay that I'm earning currently where I'm at
versus what maybe a friend or what other people in
the industry are earning somewhere else, somewhere down the street. Well,
the Wall Street Journal just wrote about why one perk
that looks great it really isn't, And that's unlimited vacation time.
This is something like that I feel like I've seen
popping up more and more as companies offering Hey, no, no, no,
(15:32):
it's not just two weeks of PTO. You can take
as much time off as you want. And that's kind
of the pitch. That's the cell from the company that
you can travel as frequently as you desire. But everyone
I've talked to, I don't know about you, Matt, who
has this benefit, they don't feel okay using it. So
(15:52):
this sounds like a great perk but in reality maybe
doesn't play out so well. That kind of the unspoken
rules dictate that you're not supposed to abuse your newfound freedom,
like the ability to travel as much as you want,
which I think actually causes people from what I can
from what I can tell, to take even less time
off than they're allowed. It's a sad reality. But I
(16:12):
would say, make sure to look this gift horse in
the mouth and ask about how this benefit functions in reality.
If you're applying for a job and the employer says, hey,
this is one of the perks we offer, I would
want to know more about how that actually works and
whether people actually take a significant amount of time off,
because we're always talking about how Americans don't taken off
their vacation time. If they have like a specific amount allotted,
(16:34):
they never take the full amount. We should all be
taken our vacation man, Like it's one of those perks
that we've earned that we deserve and all work and
no play makes us pretty dull too.
Speaker 1 (16:44):
Yeah, I totally agree. It feels like one of those
things where it's a benefit that like I don't even
know if this exists, but like it makes me think
if you go to like an arcade and it's just
like if you get this wrisk band, it's unlimited coke refills,
or like if you buy the special cup at a
gas station, it's like anytime you come in with your cup,
you just drink whatever you want. But the reality is
is how much are you actually how much soda are
(17:05):
you actually going to drink? And do you want to
drink an unlimited amount of coke? Like every time I'm
gonna drink till kidney failures. Kenny feels like something where
it's just like on paper, it seems appealing until you
actually start thinking through it and it's just like, well,
what's the actual reality of me taking full advantage of this?
And when it comes to time off, it's like, Okay,
are we talking about how great it would be to
take unlimited time off or maybe we just need to
(17:26):
actually take the time off based on a normal amount
of vacation days. And certainly it probably should be higher
in the US because we're such a work performance, productivity
driven culture. But I think that's something else to keep
in mind as well. Another typical perk that we not
we joel, but that most folks often get from their employer.
Our employers stage is health insurance. But as we're seeing
(17:47):
a rise in small business formation entrepreneurs, they got to
figure out how to get coverage without bankrupting themselves, which
is like the whole point of starting a business is
maybe for this to succeed. Vox they detailed the rise
of health sharing companies, not health care companies, but they
are growing quickly. These health sharing companies. Almost two million
(18:07):
Americans find themselves on one of these plans that look
like health insurance, but they have meaningful differences, and it's
basically the number of folks that are on these plants
have doubled in the past several in the past few years.
So look into them because they like there's significant savings
to be had, but do be careful, know the fine print,
(18:29):
know the exclusions. Juel and I we are both on
metas Share specifically they've worked well for us, but we
also haven't tested the limits, although some friends of ours have.
I think about some some good friends, and I think
it was literally the year after they joined on, she
ruptured or tore her achilles, and they were also like, well,
we were thinking about getting tonsils removed and adenoids as
(18:50):
well from like one of their whatever that is. I
don't know. I think it's in your mouth.
Speaker 2 (18:53):
Somewhere, your throat.
Speaker 1 (18:55):
But they did all of that within a year because
they were gonna they knew that they're going to hit
their what's called the annual household portion, and it worked
incredibly well for them, which was really encouraging because I'm like,
all right, I'm pretty sure this is going to work out.
And I think we'd even kind of steered them in
like that direction because they were paying an inordinate amount
of it was a little nervous. I'm just like, oh man,
(19:16):
how this works out. It worked out great for them.
I love the fact that more people are getting on this.
I was talking to a nurse friend a few days ago.
So she's a nurse, she works within the health care industry,
and I don't know how. We got to talking about
healthcare and I was I kind of sheepishly was like, yeah,
I don't know, I rarely go to the doctor. And
got to talking about health sharing. And you would expect
with her that she'd be on some sort of Cadillac
(19:38):
Premium Primo healthcare plus health Care Prime health account job,
but all the healthcare you can eat. She is on
a health sharing plan. Wow, because she's like, yeah, so
s thinking expensive, Like we don't even pay for the
kind of coverage that we often take at the hospital.
Blew my mind. But it's just evidence of the fact
that that's an area an industry that needs a little
(20:01):
bit of a reform, and I'm glad that there's competition.
Speaker 2 (20:03):
And not everyone can choose to go this routelet right,
We were like literally talking to a friend last night
who has a young daughter who has had cancer for many,
many years. They have a lot of employments they have
to go to. It gets really expensive, and so their
employment decisions are largely based around healthcare, which makes total
sense for them. But for other families like we have
(20:25):
been pretty fortunate on the healthcare front, and so we're
able to go opt for something like this in order
to reduce our out of pocket on a monthly basis,
and figures crossed that it saves us money over time
because we're just not shelling out as much for healthcare overall.
But again, this is a personal decision, and more Americans
(20:45):
are choosing some of these health sharing options because they
are saving the money. But the trade offs are a
crucial thing to take into account. All right, Map, We've
got more to get to on this episode, including where
you talk about some of the worst places to borrow money.
Borrowing money has gotten more expensive over the past couple
of years. We'll talk about that and whether or not
you're gonna get a five thousand dollars check in the
(21:06):
mail from the government right after this.
Speaker 1 (21:15):
All right, Joel, we are back from the break and
of course it is now time for the ludicrous headline
of the week. It's from c NETS. The headline reads,
is a tax prep service promising you a huge tax refund?
It could be a scam, Joel. We're sharing this one
because we want folks to know that if you have
a burning desire to get a massive, huge tax refund, well,
(21:36):
it can interfere with your decision making skills. It can
cause you to fall prey to what's being called a
ghost tax preparer. Yeah spooky, yeah Bay? Is it a
friendly ghost like Casper or friendly? So essentially, if a
so called tax preparer is highlighting how big of the
refund they can help you to get before knowing your specifics,
(21:57):
the alarm bells should be going off. The way it
works is that individual is going to then file your
return with fake deductions with credits that you don't actually
qualify for, and of course they're gonna then charge you
based on a percentage of your overall tax refund, so
they are incentivized to get as many deductions in their
ass possible. It raises how much you are going to
(22:18):
then pay them, but then your prepare disappears, you're left
cleaning up the mess. This is not the kind of
situation you want to find yourself in, and so if
you want tax help, we would recommend for you to
ask around to friends, ask for recommendations. Don't go rogue
on such an important hire like this as you're doing
your own homework. Make sure that the tax preparer has
a Prepare tax identification number. If they're trying to file
(22:42):
your taxes, prepare your taxes without having that, they're breaking
the law. That's also another red flag. Make sure that
they've got a physical address as opposed to just this. Oh,
they've got a website. They seem totally legit, but it's
pretty easy to up and vanish in the middle of
the night with a website versus having a physical off
as a physical location, and this is so nefarious.
Speaker 2 (23:03):
Matt because so many people they bank on that massive
refund every year. And if someone's kind of selling them
a bill of goods, like, hey, we'll get you the
bigger refund, like we have special tactics to score you
more money back.
Speaker 1 (23:15):
From the federal You want to leave money on the table.
Speaker 2 (23:17):
No, And that's so it sounds so promising, and you're like, well,
normally get like two grand, but this guy's saying I'm
gonna get like five or six. That is, you typically
want to walk down that road, except for in this
case it's totally false. You're gonna be in hot water
with the irs, which brings up the perpetual point of
contention come tax season, should you go tax software or
should you hire a tax pro and Kiplinger they did
(23:40):
a great job covering this. They basically suggested that software
is great for folks who take the standard deduction, who
only earn income as a W two employee, and who
only invest in traditional assets like stocks, and also for
folks who have lived in one state for the entire year.
So if you moved, you might want to hire somebody.
So if that's you, though, and you fall into all
(24:01):
those categories, use software like go with the free or
cheap options. Cash app in particular is still our favorite
because they're one hundred percent free for federal infrastate filing.
Speaker 1 (24:12):
What it used to be called before cash app bought it.
Speaker 2 (24:14):
It was credit credit car mattaxt credit. Yeah, and then
cash at bought it from them, and.
Speaker 1 (24:19):
It's continued to do an excellent job.
Speaker 2 (24:21):
Excellent job, and it's more robust than a lot of
the other free services, even the IRS Direct file service.
But let's say you don't meet all those requirements or
are you you know, you've got to come from another
source or you itemize your deductions, right, If you have
more complexity, it's often worth the cost to hire a
pro as long as they're not one of those ghost
prepares that I just talked about. Make sure they're a
(24:43):
legit tax prepare. They know what they're doing.
Speaker 1 (24:45):
So it's hard for me to hear you say ghosts
prepare it and not think of ghost peppers. Remember back
when ghost peppers were all the rage? No, when were
they all the rage? Like fifteen years ago, oh something
like that. That's like when all these like super hot
peppers started king. I hear ghosts prepare, I think ghost pets.
Uh huh, that's when that's the first time ever heard
of like the Skulville heat like that, which I know
about from Hot Ones, right, which I've never watched, actually
(25:08):
never seen an episode of Hot Ones. No. I mean, okay,
you got to watch the Conan O'Brien episode. It's insane.
That's funny. It's so funny, I guess, Okay, sounds entertaining.
I guess. I just think of folks who are like
going after the hottest pepper and it's like, oh, this
one because the ghost pepper used to be the hottest
and now there's other hybrids that they've come out with,
and it's like, well, this one's got two million Skulville
units or whatever. It's just not something I'm interested in
(25:29):
at some point. Humans, Uh, why would you want to
do that? To you? Just do it? And plus like
it makes me think about I want to eat like
a mildly hot peppers. Well, Joe, let's talk about debt,
because we are not debt and enthusiasts, but we're also
not debt haters to the core. Some types of debt,
when used wisely in moderation, we think can help you
(25:50):
to accelerate your different financial goals. We're talking about things
like a mortgage, maybe a small amount of student loans
to help you to get a degree, but specifically what
you are borrowing for and the interest rate attached to
that loan are going to be crucial factors when you're
trying to decide whether that debt product is bad, whether
it's neutral, or whether it's you know, a potentially decent investment.
(26:13):
And a new report from Solo, it's like a community
finance platform, first name Han, but they highlighted some of
the worst places to borrow and they're highlighting the negative
impact of short term loans that come with incredibly high
fees with high interest rates, subprime credit cards, payday loans,
and earned wage access that's like the different platforms and
(26:34):
apps that allow you to get paid early. They were
some of the worst culprits out there, and we totally
one hundred percent agree those are crappy products that should
be avoided at all costs. Man.
Speaker 2 (26:44):
We've talked smack about every single one of those at
some point, we hade them in the past, and yeah,
I think that earned wage access one matter, is particularly
nefarious because it looks so benevolent and those apps are
so good at marketing, they're so slick and then made
people think, oh, it.
Speaker 1 (27:00):
Looks like it's free.
Speaker 2 (27:01):
All I gotta do is is leave them a little
tip for the app creators. And when you factor in
how bad, how rotten that tip is from an interest
rate standpoint, it's awful and it's obliterating a reasonable chunk
of your pay that you shouldn't be forking over to somebody.
There's no you don't want to access your paycheck early
because it's going to cost you too much.
Speaker 1 (27:22):
It feels like a two point like a wolf payday
loan two point zero and cheap loathing.
Speaker 2 (27:28):
Essentially, it's just a modern slicker version of it that
looks less nefarious, but underneath the surface is rotten to
the core. They also mentioned in that report peer to
peer lending and by Now Pay Later as some of
the places people turn when they're in a financial pinch, right,
and those forms of debt can charge you sky high
interest if you don't make your payments on time. So
for by Now Pay Later, for instance, right, you might
(27:49):
find that the interest in fees are equivalent to a
forty five percent combined rate according to SOLO. If you're
not making your payments on time. So the macroeconomical is
that borrowing costs are up on every debt vehicle these days, right,
making every single form of debt more precarious, and the
worst kinds of debt have become even even worse right
(28:10):
over the past couple of years. A whole lot of
Americans are attracted to these forms of debt because they
have no savings to pay for an emergency man. I
think that's that's why people fall for these traps. They
feel like they have no other recourse. That's why we
talk about the emergency fund twenty four hundred and sixty
seven dollars, the bare minimum. Oh, you got to hit
that amounts. That's crucial to help you avoid needing to
(28:34):
turn to one of these really crummy debt vehicles that
could essentially bend you over a barrel for months or
years to come.
Speaker 1 (28:41):
Yeah, okay, so you know I love numbers, Joel. I
love counching the numbers. And we've been saying the two
four hundred and sixty seven dollars amount for a while.
Are you obtaining it for inflation? We have to agree
on this together. But doing a drum roll and a
big reveal. I just let me just talk to the numbers,
because the number numbers are fun. Raise your hand if
you love math. Everybody numbers like Shakira's hips don't lie.
(29:03):
So that Rep. Shakira, right, I don't know, I think so,
But that was based on research based back in twenty nineteen. Okay,
twenty nineteen is when we identified, oh, we need to
start recommending to everyone to have four hundred and sixty
seven dollars set aside. Guess what the the total inflation has,
what it's been since twenty nineteen. It's a total of
(29:24):
and he guesses, uh, I'm gonna go thirty two percent. Well,
not quite that that high twenty three point four to
five cent. So if you were to adjust two four
hundred and sixty seven dollars, if you were to update
that to take into account inflation since twenty nineteen, that
means today the new money gear number one initial emergency
(29:45):
fund should be three thousand and forty five dollars. Okay,
three thousand forty five. What do you think? Does that
have a good ring to it? It's is it as
good as two thousand and four and sixty seven?
Speaker 2 (29:54):
It doesn't roll off the tongue as much, but we
want to be accurate. Thirty forty five Yeah, okay, that
sounds better. Yeah that okay, all right, so maybe we
will update the site and start recommending for folks it's
thirty forty five that because that's a significantly larger amount
of money than I mean, this is solid more than
five hundred bucks.
Speaker 1 (30:10):
So just something to keep in mind. Okay, we mentioned
doge last week and the implications of DOGE on the
federal workforce. President Trump he has floated the idea of
sending a portion of the savings that Doge claws back
to Americans in the form of a direct payment. And
(30:31):
if you've read any articles on this, if you've seen
this talked about, you've seen like a five thousand dollars
number pretty early on. That kind of reminds me of
the early days of the stimu dollars. You know. Yeah,
eyes get bigger, mouth starts watering a little bit. You
start thinking you're gonna see a direct deposit in your account.
Speaker 2 (30:46):
Wait a second, how much am I getting? And you
kind of start pre spending it before it even drops.
Speaker 1 (30:50):
Unfortunately, because the precedent has been set. But the way
it works is some of the savings from DOGE would
help to pay down the federal debt, while twenty percent
could evidently flow to individuals. Sounds nice, but we don't
want folks to hold their breath. I think we are
unlikely to get a check for five thousand dollars in
the mailbox anytime soon. Oh yeah, I can't imagine what
(31:11):
that would do to inflation. And it just does not
seem very likely personally, right.
Speaker 2 (31:16):
No, it's it's one of those things where people are
gonna see headlines, they're gonna be like, cool, where's my
DOGE dividend, where's the check? When's it coming? And it's not.
It's not coming. Like, it's highly unlikely.
Speaker 1 (31:26):
I just don't see to be the bearer of bad news, right, Okay, Well,
I just can't believe that they floated this idea, that
they stuck it out there without I mean, it's just
how the current administration works. They're just constantly throwing ideas
out there. But when you know substance to back it up,
when you put something out there like this that folks
are like, that's something that they can wrap their heads around,
that's incredibly tangible. They've seen what that felt like in
(31:47):
the past, and if you don't deliver on that, folks
are going to be pissed.
Speaker 2 (31:50):
Honestly, it's kind of like the student loan forgiveness thing,
but I think this of this is actually being a
little bit worse because the student loan forgiveness thing was
they were attempting to do this and there might be
a legal way to pull this off, but ultimately there
were a lot of disappointed student loan borrowers at the
end of the day because that promise didn't come to fulfillment.
This is another one of those things where it's a
promise that's not going to happen, and that's because five
(32:12):
thousand dollars per household. Well that's the estimate based on
DOGE cutting two trillion dollars in federal spending. There's zero
sign that DOGE is going to find a way to
slash government spending anywhere near that level. Not that there
won't be some spending cuts around the margins that could
shrink the size of government a bit, but as we
said last week, entitlement programs would have to be significantly
(32:33):
altered in order to realize savings of that magnitude. Those
make up two thirds of the roughly seven trillion dollar budget,
and there's just no political will to touch those programs
in the slightest Like the President has basically said we
aren't going to cut back in any way, form or
fashion on those entitlement.
Speaker 1 (32:50):
Programs the campaign on that.
Speaker 2 (32:51):
So I think a five hundred dollars check, much less
a five thousand dollars check, is a pipe dream. Just
don't read that headline and assume that government money is
heading your way soon.
Speaker 1 (33:00):
Yeah, totally agree. Kind of it reminds me of like
so they also mentioned possibly floating the idea of a
gold card for folks who want to rich people from
over the US citizens, which sounds ridiculous, Like that's how
this the Doge dividends sound. It just kind of sounds ridiculous.
Catches all the headlines the gold cards. It sounds like
it's totally something Trump would do because it's gold, you know.
(33:22):
But I will say, once you start realizing that other
countries have incentives like this, it seems less ridiculous, Like
it just seems like some sort of pipe dream, like, Oh,
let's throw this up the wall and see what sticks.
You just assume that everything that the current administration is
doing is like completely ridiculous until you start seeing that, Oh,
other countries also incentivize investment and high net worth individuals
(33:43):
to move to their country for the good of the
overall country.
Speaker 2 (33:45):
Gold card thing seems less ridiculous, less ridiculous, Yeah, totally,
And it's you're incentivizing people to come to your country
who are hopefully going to be productive citizens. Yeah, invest
in the economy. But we'll see if it pants, will
see if that pants out here. All right, that's gonna
do it for this episode. We will post links to
some of the stories that we mentioned in today's Friday
(34:05):
Flight up on our website at Howtomoney dot com. Matt,
it's gonna do it for this one. Until next time.
Speaker 1 (34:10):
Best Friends Out, Best Friends Out,
Hosts And Creators
Joel Larsgaard
Matthew Altmix
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