August 9, 2024 • 32 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: waffling on Rivian, huge sales for small cars, warranty warnings, Wells Fargo under fire, rocketing your rizz, money mores, stocks get smashed, dropshippers false bill of goods, & renting your assets by the hour.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to Had of Money. I'm Joel and I am that,
and today we're talking about war and t warnings, rocketing
your RIZ and stocks get smashed.
Speaker 2 (00:27):
So your RIZ headline makes me think of one thing,
and I've gotta think you're thinking the same thing too.
I don't know, am I. Rocket Fizz is not the
name of the candy shop right around the corner from
us that our kids love it. I was not thinking
about that really, due Yeah, I don't know. Rocketing YOURRIZ
makes me think of rocket Fizz, which is kind of
a terrible store. It's just nothing but candy, nothing with candy.
Speaker 1 (00:47):
It's actually kind of cool though, because they have like
nostalgia candy that you can't but you can't find anywhere else.
Speaker 2 (00:52):
Yeah, that is pretty cool. Yeah yeah, the kids are like,
what is that. I'm like, Oh, back when I was
a kid, this is what we used to get in
our Halloween best.
Speaker 1 (00:58):
We used to protect smoke with these candy cigarettes. I'm
surprised anyone sells.
Speaker 2 (01:03):
Of course, the kids are drawn to the candy cigarettes
and the big League chew right, like the two things
keep the kids off of But yeah, now this is
our Friday flight where we cover the most interesting stories
we've come across this week and how they pertain to
your personal finances. But Joe, you want to see you
got to know here. You want to talk about how
you're waffling on your Rivian, which is still like at
(01:25):
least two years out, but you're already having second thoughts
I guess as to whether or not you're gonna get
I'm gonna be waffling the whole entire time, Matt until
you take delivery. Actually, what's what's the return policy? I know,
because after it's in your driveway, you're still going to
start getting super nervous about the fact that you've just
have I made a mistake, I know for real.
Speaker 1 (01:43):
No, I think part of it is the secondary costs
of I'm like, oh, the taxes and all the extra
insurance costs, even if even if it's a forty five
thousand dollars vehicle, at the end of the day, it's
going to cost more than that, right, and so I'm
nervous about that. But then something else gave me costs
for a concern just about buying an electric va, specifically
from one of these startup companies, and I think Rivian
(02:03):
has a lot more room to run because especially that
recent investment from VW that they got. But Fisker went busts.
Oh yeah, think about anybody who bought a Fisker car.
What happens now that these are not just cars that
run of themselves. You might not have the same support
like whendewu went bust or something like that. But these
are computers on wheels these days. Yeah, these fancier new cars.
(02:25):
And so you stop doing software updates, you stop supporting
those cars, do they become like a smartphone that doesn't
get updates anymore? So interesting, that's what makes me nervous
about buying from a startup company. So I hadn't really
thought about that. And I looked into this a little bit,
and it looks like Rivian says there's seven years of
support that they're guaranteeing, I guess to their customers, which
I don't that how they guarantee it. But seven years
(02:46):
only seven years, Yeah, that's what I was gonna say.
I was gonna say, that's actually not that long.
Speaker 2 (02:49):
No, in phone terms, it is been not in car terms, yes, exactly.
And we want folks to hang on to vehicles for
much longer than that because so We've got a twenty
twelve Honda Odyssey that we bought used, but we you've
owned it for a little over eight years now, and
so I would hate to think that, oh yeah, at
a certain point, this vehicle is going to stop running optimally.
But like also it takes away the residual value because
(03:11):
you're you, you still have value in that car even
if you were to sell it, but you might not
if it's it's a car that no longer has any supports.
A toss up though, because that's the thing. If they
continue offering support for it, you know, the value is
it's not going to depreciate nearly as quickly. Right. But
I've got to think though too with Rivian specifically, because
they're so geared to the outdoors and clean energy and
(03:32):
that's like their whole brand. There's no way that they're
going to stop it at seven years. Yeah, because I mean, well,
Tesla's well we can look at Tesla, because Tesla they
still offer support for their older model S came out
in twenty twelve. You say this and you still and
the Model S is still get still get.
Speaker 1 (03:46):
Support, true, And I think that they that will be
the case if they stay in business like. I don't
see them pulling the rug out from customers, but I
do see that running because right now they're losing money
on every car that they sell, and so how long
can they keep can is it going to take for
them to profitability? How long will they be along around?
So I guess that's that's really the key here is
if Rivian stays around, I think they'll do well by
(04:08):
their restlers, they'll do the right You're.
Speaker 2 (04:10):
Less worried about them making the right call assuming they're around.
But the big question is whether or not they are
going to be around.
Speaker 1 (04:15):
Are there many harder industries to make it in these days,
especially as EV interest kind of wanes a little bit.
We're going to talk actually more about cars here in
just a second, but I don't know. That's a question
that's on my mind. And I think the next two
years will learn a lot about what's happening in the
startup EV space, and that will either make me feel
a little more comfortable going in that direction or less comfortable,
and that will, I think influence my decision totally. Let's
(04:36):
keep talking about cars, though, Matt. In America, we tend
to think the bigger is better. I like the Ribbean
cars are kind of big, right.
Speaker 2 (04:42):
The goal tends to be, but they're not too big.
It's not like they're not like expedition platinums or giant tahoes.
Speaker 1 (04:48):
Especially the models that are coming out next, the R
two and R three, they're smaller versions, right, so.
Speaker 2 (04:53):
Whe they're more affordable.
Speaker 1 (04:54):
But it feels like what people want is like bigger, bigger,
more and more and more, bigger house, fancier car. And
that's how you know, I guess you've made it in
this country if you've got the bigger vehicle, the bigger house. Well,
some of those trends are reversing. We've talked about how
how home sizes new home sizes actually have reduced in size. Well,
the same thing is actually happening in the car market. Finally,
for the first time in a long time, people are
(05:16):
realizing how costly big trucks and SUVs are, and our
addiction to big automobiles. It's not going away in this country.
But new statistics from cos reveal how compact cars and
compact SUVs are seeing a surge of interest. So the
crossover suv segment MATT in particular, the sales of those
(05:36):
have seen a twenty plus percent point sales increase in
the first half of this year. The most popular models,
by the way, of those kinds of cars we're talking
about are twenty two thousand to twenty five thousand dollars.
This is not bad for a brand new car. SI crossovers, Yeah,
and they're just they get you up off the ground
a little bit more. I think people really like those
because they feel like an suv, but they're a micro
(05:57):
version of it exactly. But Civics and Corolla and are
feeling the love right now. They're not going to work
well for a family of six or seven, but it's
a good reminder, I think to weigh the pros of
buying a bigger ride with the cons of the higher
price tag that's attached.
Speaker 2 (06:10):
To You know, so you mentioned Corollas. Have you seen
any of these Corollas, Corolla Crosses or whatever. They're Toyota Corollas,
but they're like the crossover version of the Corolla. It's interesting, Yes,
it's it's like they're most I don't know if it's
the most affordable crossover suv, but they're gearing it as
like an suv, so it's I mean, it's got the
slope back and it's higher up off the ground and everything.
(06:31):
It's crazy off. Look that up.
Speaker 1 (06:32):
Well, the new Priuses look a lot sleeker than the
old ones. The old ones used to look so nerdy andy,
and now the new Prius terrible.
Speaker 2 (06:39):
Yeah. Yeah, it's funny how tastes and style. It's a pendulum, right,
Like it swings from one end of the spectrum back
to the other and then it kind of starts coming back.
Because we I always love station wagons and like all
of these crossover eshuvs are basically station wagons. They're just
like a little bit higher up off the ground. But
when we had our VDA passat wagon, dude that we
love that thing, and I fully embrace the fact that
(06:59):
it was a state I think as people have gotten
used to the idea of having something that's not totally
an SUV, but it's more suv than it is station wagon.
I guess like it makes me think of you, like
the best station wagons are like the old Mercedes or
the old Volvos, oh, those like from the eighties. Yeah,
it's like the exactly opposite of electric vehicles. And by
(07:19):
the way, Consummer reports, they of course are going to
highlight the best used cars under ten thousand dollars. It's
going to be the usual players that you're used to seeing,
Honda Fit, Mazda three, the Honda Accord, even the Lexus. Yes,
they actually made the list as well, So that's a
newer player, obviously made by the same company as Toyota. Yeah.
Speaker 1 (07:38):
Well, and those affordable the older you look in the
luxury car market, you're going to find that they actually
end up becoming roughly the same price as some of
the non luxury cars. Buying a twelve year old luxury
car is one thing. Buying a brand new luxury.
Speaker 2 (07:52):
Car is another. Yes, right. I don't know if you've
ever heard folks criticize Lexus as well, but they're like,
it's just a Toyota but with the leather.
Speaker 1 (08:00):
They're not wrong. I mean, I think they're nicer in
other ways. They are, but that's under the hood.
Speaker 2 (08:04):
Is about this. A lot of folks will certainly will
argue that it's a Toyoto but with leather. Another question though,
when you buy the car, should you get the warranty? Well,
we are fans of opting for a reliable make and model.
Are they just skipping the extended warranty. The worst choice
oftentimes is going to be to buy one of those
different third party warranties. One of the bigger warranty companies
(08:25):
out there, car Shield. They've been ordered to pay a
ten million dollar fine for deceiving customers. They've got advertisements,
or maybe I'm guessing at this point they had advertisements
out there. I'm sure they've pulled them down. That we're
touting the quote unquote peace of mind and the protection
that you're buying.
Speaker 1 (08:41):
Oh, it makes me feel safe, like I'm wrapped up
in a warm blanket.
Speaker 2 (08:43):
Exactly a heat nice heated blanket in cold winter's night.
But a lot of consumers found empty promises. There are
litany of repair exclusions. There's a ton of fine print
that frustrated customers and then often left them on the
hook for the repair. In addition to the over one
hundred dollars a month that they have been paying to carshield.
This warranty service wasn't accepted at many of the repair
(09:05):
shops that they claimed that they work with. And so yeah, again,
folks are just left with a subpar product, paying much
more than they needed to have. And this leads us
to make the recommendation that, similar to many different insurance
products out there, you're likely going to be better off
di wying it. So were there to be a repair
that you need to make, you're going to have the
cash in hand in the bank to be able to
(09:27):
make that repair yourself, as opposed to going through all
the rigama role in filing a claim seeing to it
that it gets accepted makes the same thing is true
with home warranties as well. I've got a buddy they
just went through that where their HVAC his AC unit.
Long story short, they denied him he had to go
to litigation or I guess he threatened litigation, and so
he entered into arbitration where they over months. Dude, I
(09:51):
mean they just gave him the run around, and then
finally they reached a settlement to where he wasn't the
full amount that it cost him to have to repair
his age back. But certainly bad taste in his mill.
Home warranty companies and car warranty companies real similar. They are.
Speaker 1 (10:04):
They promise a lot, they almost always under deliver, and
the fine print the devil's in the details, for sure.
Make sure you're paying attention to those things before you
buy one of these products, because yes, the advertising can
make it sound like, oh my gosh, five hundred bucks
a year or one hundred bucks a month, and it's
going to cover all this stuff. I don't have to
worry then if my car breaks down or whatever, I
don't have to have the savings on hand. I said,
at least one thing taken care of. It almost never
(10:27):
actually turns out to be like that in how it
plays out, similar to what your friend indored, similar to
what a lot of car shield customers endurured. So let
that be a warning to you. Another warning here, Matt,
another day, another Wells Fargo scandal. Talk about it. They
can't catch a break, and I think it's probably because
they consistently do things that screw their customers.
Speaker 2 (10:46):
Over.
Speaker 1 (10:46):
Wells Fargo is bad news bearers, and they continue to
be so they keep talking about changing the corporate culture.
That doesn't seem to happen.
Speaker 2 (10:54):
This time.
Speaker 1 (10:54):
They're being sued because of their paltry rates and enormous
fees on cash accounts. So this lawsuit is specifically being
levied by clients in the wealth management space. They're trying
to hold Wells Fargo to its fiduciary responsibilities, and fiduciary
means they are legally required to do what's in the
best interest of their customers and the estimation of their customers.
(11:17):
The point zero five percent savings are rate for uninvested
cash doesn't qualify as a fiduciary follow through, especially by
the way, when firms are paying one hundred times that amount.
So this isn't even in the ballpark. So this is
just another reminder not to do business with companies that
are terrible in general, and specifically to avoid Wells Fargo. However, Matt,
(11:39):
I also think this, if you're investing with Wells Fargo,
the paltry savings rate is likely the least of your worries.
My guess is there are fees awful funds that you're
being put in, So don't invest with the big banks.
Don't have an account with the big bank in general.
That is I think that's the big takeaway here. That's
right man, Okay.
Speaker 2 (11:55):
Here at how to money, we are always all about
you advancing in your career, right, finding some different ways
to boost maybe the fulfillment that you are deriving from
your career or from your work, but also boosting the
amount of money that you're able to make while performing
that job.
Speaker 1 (12:10):
And even better would be if you were able to
do that and work less while you're at it.
Speaker 2 (12:14):
Oh is that not? Yeah? Exactly, but there is a
reason headline from the journal and the headline read this
probably could have been maybe our ludicris headline of the
week two, but the headline read is RIZ the secret
to getting ahead at work, which only indicates the fact
that millennials and Gen X has found the word riz. Yes,
(12:34):
if they're incorporating it into the journal.
Speaker 1 (12:36):
Pretty sure my mom and dad would have read that
headline and they would have been like, I don't know
what they're doing.
Speaker 2 (12:39):
But this made me think a couple of things. First, like,
what they're talking about is charisma, of course, but soft skills.
But you got to use the cool language RIZ to
say it. Soft skills. They are in fact crucial to
career progress, right, Like it's not just about your the
resume credentials, where it is that you went to school.
Front of the show go Rick. He called these the
unspoken rules of success. This is back in episode seven
(13:02):
oh two, if you want to go back and listen
to that conversation. But mastering them I think it will,
in fact increase how much you're making there at work,
maybe increasing your RIZ. The other upside potentially that comes
with that make you better with the people you're trying
to hit on at the bar, but also genuine virtue
that is gonna trump RIZ every day of the week. Right,
And so we're just talking about being just a hard worker,
(13:23):
being kind and reliable, being humble. Nobody wants to talk
about that though, right, Like those are those aren't the
kind of words you're going to see in any headline
of any publication these days. They're not nearly as flashy.
Speaker 1 (13:35):
Virtuous man gets raise a job exactly.
Speaker 2 (13:38):
Yeah, you're right. It's for the same reason you don't
see that like emotionally healthy, well balanced family like enjoys
picnic at the part, Like nobody wants to read about that,
Like you want to read about the shortcuts or the
things that you think are going to give you the edge,
Like okay, cool, how can I get some RIZ?
Speaker 1 (13:51):
Do I need to spike my hair, like Matt, or
what do I need to do to really increase that
RIZ factor at work? And I think you're right, Matt, Like,
just doing the right thing, though, is what we want
to encourage that. That's the click bait headline version, and
the underlying truth is just be some of these basic
things that employers want and that people like. And it
doesn't necessarily have a lot to do with being incredibly flashy.
(14:12):
It's about kind of that everyday reliability, dependability, likability that
I think is going to get you ahead at work
onered percent, not in an instant. Just like everything, all
the good things in life take time. Building wealth takes time.
Getting ahead in your career takes time. But if you
exhibit these traits over a period of time and you
advocate for yourself, it doesn't necessarily have to be riz.
I think it's a little more meaty.
Speaker 2 (14:33):
And oh I like that you said meat because it
makes me think of barbecue, Like what's the best barbecue
out there? It takes hours, It takes time. It's not
something that you can just like throw in the microwave.
This no, no, no, this this butt right here. This thing's
got to smoke for ten to twelve hours. You want
to be that's quality stuff. You want to be a
brisket employee. Okay, that's exactly what you want to be.
You're in it for the long con that's right.
Speaker 1 (14:51):
Riz feels like it's this, it's this like microwave sort
of yeah, material that.
Speaker 2 (14:55):
You're the cuisine. Yeah, but there's some a TV dinner
version a lot of people that's gonna get you a lot.
Totally agree and let's keep moving, Matt. A new PayPal
study finds that splitting the bill with friends is leading
to hurt feelings. Explain, John, you and I we've split
bills before. Are you? Are you upset with me in anyway?
Every single time?
Speaker 1 (15:14):
We can talk about it right here, right now, if
you want to in front of everyone. The average American
says they are owed nine hundred and twenty six bucks
on average by friends and family, so they're holding accounts.
They're like Aunt Susan shooting pay up. Well, I would
too after we went to those over nine hundred dollars
that people owed me. It's probably not one person. They're
probably splitting up a bunch of against a bunch of
different people, right is my guess. Well, and understandably more
(15:36):
than a third of these folks feel awkward asking.
Speaker 2 (15:39):
About it right.
Speaker 1 (15:39):
Sure, you don't want to bring it up with Aunt
Susan at the July fourth hang that you just experienced
last month. They don't want to seem cheap, right. It
makes me think of a friend Matt recently, who he said, Oh,
my wife went out to dinner with some coworkers. They're
all good friends, and she said, well, I'm trying to
get this credit card rewards bonus, which sounds like something
I had A money listener would, right, something You and
(16:00):
I have something that you and I would do, and
so hey, let me pay with my credit card and
we'll settle up. You guys, pay me via Venmo, because
it's never been easier than ever before to settle up
you don't have the cash on hand, write a check whatever,
just to toss it over via cash app or Venmo. Right, Well,
she got stiffed. I think she ended up being eighty
bucks out of pocket when she should have been thirty
bucks out of pocket. I mean, just because people underpaid.
(16:23):
Lady didn't factor in the tip something like that. Maybe
one person didn't pay at all. And that's the kind
of position you leave yourself in, which if you offer
to pay for the check in order to get those points.
Speaker 2 (16:32):
Yeah, I'm having all these flashbacks from high school of
sitting in like a chili as or Applebee's being like,
but I only only had like one of the right
mozarella cheese sticks.
Speaker 1 (16:41):
Well, it's our listeners like ours, who are trying to
save money that they might say, you find yourself in
an awkward position where everon wants to split the bill evenly,
and it's like, but I just had water, yeah, yeah,
and like I didn't have the dessert either.
Speaker 2 (16:50):
I didn't eat anypion popery. Yeah, I'll just take my
check please. So I think that the people getting the
short end of the stick on this probably are most
of the time how to money listeners. They're the ones
opting for the cheaper main course whatever it is, in
order to save money while still being able to enjoy
that outing with friends. And so if the people you're
with are trying to split the bill evenly, you're likely
(17:11):
going to be paying more than you expected. It can
be an all around uncomfortable situation. So I just would say,
brief that subject, don't be don't let it be too awkward,
and also don't put yourself in a position where you
might get stiffed and it might hurt your friendships. Yeah,
by just avoiding the even bill split all together, I
think that's when you can just offer for separate checks.
But I think what's key in making sure you get
(17:31):
paid back is to nip it in the bud right like,
that's something you need to address immediately, because the low like.
Speaker 1 (17:36):
What you were going to say, show up with an
airhorn on the doorstep at six as like it says
they will pay you if you do that.
Speaker 2 (17:40):
As soon as you part ways, that's when it feels
awkward because then you're not face to face as opposed
to if you're sitting there and be like, oh, hey,
let's see, let me calculated up real quick, you owe
me this. Oh it looks like you owe me this.
No one's going to balk at that right there because
they see you doing the math. There's like if you're
text them two days later, well even like later that day,
it's kind of like, I don't know, somebody might have
moved on with their day, with their life and they're
(18:01):
not really thinking about that. So what I'm saying is
that pay for your nacho. It may not even be intentional,
but I think there can a lot of times be
confusion too as to what it is that somebody is
getting themselves, like getting themselves into because of the fact
that we all have different like more rais and customs
that we're used to that we have grown up with.
Like it makes me think about the last time I
went to top Golf and it was organized by somebody, and
(18:22):
I'm like, oh, yeah, I can make it, then let's
do it. It sounds like fun. He paid for everybody as well,
and so I don't. I'm like, oh my gosh, I
was not expecting that. Thank you so much. I was
incredibly gracious. But I'm like, it's interesting because if I
would have organized that and gotten everyone together, I wouldn't
have expected like, I'm not paying for it. No, we
just like agree to meet up, cough up the money,
(18:42):
you know, you're paying for yourself. And so I just
think a lot of a lot of times there's just
like that's where the confusion comes from. It's just folks
that have just different expectations as to what it is
that is expected out of somebody. And in that case,
I would say, when it comes to like if you're
gonna cover coffee for somebody, like just cover coffee, like,
don't expect them to like pay you back.
Speaker 1 (19:03):
I think that's sometimes how people do it. They're like, oh,
I'm gonna do this and then they'll get me next time.
But if it's not explosively stated, they might get you
next time. But if they do, like have that be
like glue that bonds the relationship even more. It's like,
oh sweet, Like we haven't a common shared unspoken language
here between us. There's like something magic, right, Like there's
this invisible magnetic attraction that takes place when you've got
(19:23):
multiple folks who are kind of, you know, think in
the same way. There's an unspoken oh yeah, you think
you view the world the same way that I.
Speaker 2 (19:30):
View the world. And that's kind of what leads to
like the growth of any relationship, right, Like it's it's
seeing the world in the same way and being.
Speaker 1 (19:36):
Like, yeah, that's right, that's how we do this. I
hate the idea of people hurting a friendship potentially irreparably
over the price of a dinner, right, and so just
try not to put yourself in a position where that's
going to be the case. But if it comes down
to it, friendship means more than money.
Speaker 2 (19:52):
Yeah, I think so, I think I'd agree. All right, Well,
we can't end the show without talking about the stock market. Jool.
So we'll get to that and other stories right after
the break. All right, Matt, we're back.
Speaker 1 (20:09):
Let's sign down to get to the ludicrous headline of
the week. And we've never done this before, but let's
get to basically every headline about the stock market at
the beginning of the ludicrous.
Speaker 2 (20:18):
It's like an index fund headline. Yeah, it's like a
collection of all the averages of all the financial stock headlines.
They were all absurd, over the top. We have to
talk about this.
Speaker 1 (20:27):
And of course the stock market experienced a decent recovery
towards the end of the week, but almost every stock
market related headline on Monday Tuesday, you was using words
like bloodbath, plunge, plummet, crash, like everything, right, every terrible
word you can ascribe to the stock market with eight
three percent down day for the S and P five hundred.
(20:48):
These news outlets, I don't know if they're just trying
to get clicks or whatever influencer reels. You were seeing
these sorts of terms thrown around, bandied about like we
were in nineteen twenty or something like that. Right, and
folks on Twitter are blaming the Fed for not acting sooner.
There were emergency interviews on CNBC mat of people talking
about how the FED had to step in and do
something right here, right now, or this is going to
(21:09):
get so much worse. And I think when we take
a step back after one bad day in the stock
market or a slight decline, that's not even a correction, right,
because a correction you typically talked about that as being
a ten percent decline. Let's look at like step back
and look at the facts, and all the incredible rhetoric
made very little sense in that backdrop. Unemployment number still
(21:32):
near historically low levels. The stock market is still up
massively over the past few years, even this year, right,
I think we're down eight percent from all time highs
at the worst of it.
Speaker 2 (21:41):
And yes, sixty.
Speaker 1 (21:42):
Four percent of the time the stock market experiences a
minimum of ten percent decline in a given year. We
haven't had a real recession of what feels like fifteen years.
We had the COVID blip, right, But the average typically
throughout the US history is fewer than every six years,
every five point something years we experienced a recession. So
the freaking out relative to historical trends is hard to fathom.
(22:06):
I didn't really understand it. While I was happening, the
panic headlines were just overwrought. They were unnecessary. What we're
experiencing right now is completely normal. Yes, I think what
we experienced over the past eighteen plus month is what
was a little bit abnormal.
Speaker 2 (22:19):
Maybe sure, yeah, yeah. It kind of makes me think
of mortgage rates over the past ten to fifteen years
and now folks are kind of freaking out at where
they are now, and it's just like, I don't know,
this actually might be a little bit more normal than
the good times that we have recently experienced. Although that
was a silver lining is mortgage rates did come down
a little bit well y as folks are looking ahead
to FED rate cuts. But what happened last week and
(22:39):
this week in the stock market, it is and it
will be par for the course for investors because your
index fund is not this glorified highield savings account that's
just going to experience far superior returns. And so what
should you do at least moving forward. Well, we've got
an article that will link to, but do not sell
your investments. Do not sell, just keep buying. Don't change anything, honestly,
(23:02):
But if you're lucky enough to have like a pre
scheduled dollar cost averaging buy on the calendar. Well, great,
good for you, that's nice, But even still, don't blow
that out of proportion because you're looking at at most
like a ten percent discount. Okay, so you're dollar cost averaging,
and so that's it's a really small purchase and you
got ten percent off of that, Like, that's that's nothing.
My penut is not going to be enough to make
(23:24):
or break anybody.
Speaker 1 (23:24):
Compared to the downside of what can happen if you're
waiting for a pullback. Think about the people waiting for
a pullback matt over the last couple of years, waiting
to invest the dry powers on the sidelines on a
big run up.
Speaker 2 (23:36):
Yeah. So if you're invested for decades from now, what
we're saying is that there is no need to make
any changes. But if you're massively freaking out though before
we even get close to bear market territory, I think
it might be time for you to just reassess your
liquid cash balance, the amount of margin that you have
on hand to make you feel comfortable. It might be
worth reassessing what investments you're in, because if you're invested
(23:56):
in a way that causes you to lose sleep. I
think it might be time to change things up. It
might be time to change your holdings.
Speaker 1 (24:01):
Let's say you're listening and you're sixty seven years old,
and you left your job last week, and you are
ninety five percent invested in stocks, and you see an
eight percent decliinent and you're like, that changes things for me.
Speaker 2 (24:12):
I get it.
Speaker 1 (24:13):
Yeah, you probably are over allocated in stocks and you
need to change the allocation in your portfolio because of
where you are.
Speaker 2 (24:20):
But it depends on who you are. Because yeah, for
the new investor, they're like, well, yeah, guys, I'm not
freaking out. I've got you know, fifty thousand dollars invested,
just got my new job a couple of years ago.
I'm doing pretty good. You know, I got fifty fifty
k invested. It's gonna look a lot different in the
if you're checking in on your balance in the middle
of the day when you're down eight ten percent and
you've got fifty k in the market as opposed to
like one point five million, right, Because yeah, there's just
(24:42):
a there's a different impact that it has on your gut.
When you say, when you see one point five million drop.
I tend to see an absolute dollar amount. Yeah, yeah, yeah, exactly,
But it's also the same percentage. But the impact that
has on your portfolio, it varies wildly.
Speaker 1 (24:55):
Yeah, and so much also has to do with your
time horizon, how much the younger worker you're describing, Matt,
has a lot of decades for a recovery to happen,
or an eight percent to feel like a blip. If
you're taking rm ds, you it required minimum distributions. The
eight percent blip it hurts to me. Yeah, it hit
You actually are locking in those losses. Yeah, I feel
(25:17):
for those folks. Okay, Matt, let's talk about online creators
and maybe what the line creators we are talking about.
Let's throw ourselves under the bus. You talking about us, Okay,
but here's the thing we're not doing is trying to
sell people expensive courses that might or might not help them.
There was an interesting article in the Free Press last
week and the headline was drop shippers get rich by
making you feel poor. And if you've watched anything on
(25:39):
YouTube ever before, which is like ninety nine percent of
the people listening, you've seen dozens of pre roll ads
for people trying to help you learn how to drop
ship because it's easy money, like anybody can do it.
You don't have to have any real expertise in order
to become an expert drop shipper. And you might have
wondered whether or not the promise of easy money was legit,
and the the answer is not really. And drop shipping
(26:03):
is basically online arbitrage. Right. You find cheap items, you
resell them elsewhere for more money, which it sounds easy,
but it's harder to actually pull off. You might create
your own Shopify website, and then you have to find
a way to get people to come buy the stuff
from you instead of buying from the other websites that
they typically use. And trust, it sounds, I guess maybe
(26:23):
like a reasonable way to make money, but it's not
as stupid simple as a one minute TikTok video makes
it seem. Yeah, And so they're saying, these influencers are saying, well,
buy my expensive course, I'll teach you how to do
drop shipping, but it's going to cost you a lot
of money, that's right, Yeah, And drop shippers in particular,
they're not making the big bucks by doing the thing
that they're supposedly teaching about they're profiting off of your
(26:45):
desire to make money, and for those folks, it's easier
just to market to amass the social media following of
folks who are going to buy what it is that
you're selling an overpriced course, rather than making a living
off of actually drop shipping.
Speaker 2 (26:58):
Yeah. I also think of like some of the different
courses out there on like investing and how like, oh,
there's like this investing newsletter or you subscribe and I'll
tell you which one is to invest in, which is
in my opinion, even more egregious because investing specifically, like
there's no limits to the amount of money, the amount
of capital that you can pour into that. It's just like,
all right, if you've got this additional if you've got
all the secrets, then why aren't all of your dollars
(27:21):
going directly into the investments that you say are going
to make me rich?
Speaker 1 (27:25):
It does not compute at all. That's always the question
I have. If you are so successful at drop shipping
or investing, why are you selling me this forty two
hundred dollars course or nineteen hundred dollars course so that
I can learn how to do the thing that you're
doing and also crush and make tons of money. Why
not just funnel those secrets to success into more drop
(27:45):
shipping or investing success.
Speaker 2 (27:46):
That's my argument because with drop shipping, I feel like
there could be an end to that. It's just like, Okay,
there's problems with scale or there's only so much arbitrage
and so many discounted items that you can find. But
with like with investing, well.
Speaker 1 (27:58):
Then is the prison you're selling the course to also
going to have trouble growing their drop s business too?
Speaker 2 (28:02):
Yeah exactly, but like that's not they're not highlighting that fact.
But that's why with investing, like in my opinion, those
courses are even worse because of the fact that there
is no limit as to the number of investments that
you can buy, the number of shares you can just
continue to invest. It's this limitless thing. But the truth
is that they're selling you a false bill of goods.
Speaker 1 (28:21):
It's right, Yeah, it's really expensive. I think more and
more online courses are out there in a variety of
different on a variety of different subjects and ways specifically
to earn money, Matt and you have to be more
careful than ever before. I'm not saying they're all garbage,
they're all worthless. Like you'd never ever want to spend
a dollar on any online course from anyone, but especially
(28:45):
given kind of the age we live in of books, audiobooks, podcasts, blogs,
there's a lot of there's just so much free information
out there. Is it true that you need to pay
somebody big bucks to learn their system to riches or
are there ways for you to educate yourself and decide
whether or not it's even for you or not before
you spend a lot of money to a particular influencer.
Speaker 2 (29:04):
Yeah, folks want to. They want to, They want to
hit the easy.
Speaker 1 (29:06):
Button exactly, and I think that's what a lot of
these these course creators are selling. Let's talk about house hacking, Matt.
We've we've always talked about house hacking as a way
of making additional money off of the home that you own.
Speaker 2 (29:18):
Right, this is a legitimate way to make some extra exactly.
Speaker 1 (29:20):
House hacking is a massively underappreciated approach to wealth building.
It's underrated, and a recent article though from CNN, use
the term a little differently. I saw house hacking in
the headline. I was like, Oh, I'll read that because
I love house hacking. I love what it can do
for people. But they were taking a more nuanced approach
with their definition.
Speaker 2 (29:38):
In this piece.
Speaker 1 (29:39):
They were saying, well, what if you don't just rent
out a portion of your home, but instead you rent
it out your home or part of your home by
the hour. I was like, well, that's that is interesting.
Speaker 2 (29:48):
Yeah.
Speaker 1 (29:49):
Apparently, just tons of services we've talked about a couple
of these over over the years have sprung up allowing
people to do just that. So if you have a
swimming pool, for instance, they're swimply, you can rent that
out by the hour, so instead of using that's.
Speaker 2 (30:01):
One of my favorites. Yeah, the fact that it's adorable.
Speaker 1 (30:03):
Right, But let's say you want to, oh I want
to do a pool party for my daughter or my
son this weekend. Swimply you just rent the person's backyard
in their swimming pool for eighty bucks an hour or
whatever it is. And that's pretty cool.
Speaker 2 (30:15):
What if they're like Airbnb there and they're like, no parties.
Don't you gotta read fine print. You gotta read fine print.
But it is cool.
Speaker 1 (30:21):
And let's say you have a swimming pool and you're
like I'm not using it, or I don't mind hearing
the joyful glee of children in my backyard when I'm
not using the swimming pool. You can rent that out
and make some extra Money's pretty cool. There's peer space
for renting out your beautiful yard, let's say, if you
have one for pictures or your other space. Curb flip
which allows you to rent out a parking space if
you have a desirable parking space, or neighbor dot com.
(30:43):
Pretty sure we talked about this one before too, Matt.
You can rent out a portion of your house, not
to a person to stay there, but so they can
keep their items there right for storage, so stuff, Yeah,
instead of going to one of the storage facilities, Well
maybe you can find someplace closer and cheaper because a
neighbor has a garage that they're not using to the
fullest extent, and you get to use a portion of
(31:04):
that for a small monthly fee, and you, as the
garage owner, can make side income from something that was
previously going unused. And so you're not going to make
as much money via this house hacking method, but it
could help bring in some extra revenue. Makes I think
even there was a service we talked about a while
back called baby equip and you can rent out the
baby equipment that you're not using. There's all sorts of
(31:26):
ways to make.
Speaker 2 (31:27):
For folks who are traveling, maybe in the city where
you live, and it didn't make sense for them to
bring along their bob stroller or something like that, and
you've got one of those on hand, and.
Speaker 1 (31:35):
They're saving a little bit of money, you're making a
little bit of money, And I just I love that
there are unique ways to make additional money that aren't
just gig work. Right, that's not just trading your time
for money, which is something we talk about as like, yeah,
maybe for a short period of time, it makes sense
to do a gig job, but does it make sense
to have a gig job in perpetuity. Well, some of
these things are at least trading your assets some of
(31:58):
the use of your assets for money instead of your time,
which is more valuable. Yeah, this is a form of
arbitrage that might work for you where you don't have
to pay for that expensive online course to learn how
to do But uh, all right, that's gonna.
Speaker 2 (32:10):
Be it for today's Friday flight. We'll see you back
here on Monday. We'll have a fresh ask How to
Money episode lined up for you. If you've been listening
to the show and you've found it valuable, we would
love it if you left us a review over at
Apple Podcast, wherever it is that you might be listening
to this episode of How to Money right now, and
leave us a solid one over there and a big
thank you in advance. But Jill, that's going to be
(32:30):
at Buddy, So until next time, best friends Out, Best
Friends Out.
Welcome to Had of Money. I'm Joel and I am that,
and today we're talking about war and t warnings, rocketing
your RIZ and stocks get smashed.
Speaker 2 (00:27):
So your RIZ headline makes me think of one thing,
and I've gotta think you're thinking the same thing too.
I don't know, am I. Rocket Fizz is not the
name of the candy shop right around the corner from
us that our kids love it. I was not thinking
about that really, due Yeah, I don't know. Rocketing YOURRIZ
makes me think of rocket Fizz, which is kind of
a terrible store. It's just nothing but candy, nothing with candy.
Speaker 1 (00:47):
It's actually kind of cool though, because they have like
nostalgia candy that you can't but you can't find anywhere else.
Speaker 2 (00:52):
Yeah, that is pretty cool. Yeah yeah, the kids are like,
what is that. I'm like, Oh, back when I was
a kid, this is what we used to get in
our Halloween best.
Speaker 1 (00:58):
We used to protect smoke with these candy cigarettes. I'm
surprised anyone sells.
Speaker 2 (01:03):
Of course, the kids are drawn to the candy cigarettes
and the big League chew right, like the two things
keep the kids off of But yeah, now this is
our Friday flight where we cover the most interesting stories
we've come across this week and how they pertain to
your personal finances. But Joe, you want to see you
got to know here. You want to talk about how
you're waffling on your Rivian, which is still like at
(01:25):
least two years out, but you're already having second thoughts
I guess as to whether or not you're gonna get
I'm gonna be waffling the whole entire time, Matt until
you take delivery. Actually, what's what's the return policy? I know,
because after it's in your driveway, you're still going to
start getting super nervous about the fact that you've just
have I made a mistake, I know for real.
Speaker 1 (01:43):
No, I think part of it is the secondary costs
of I'm like, oh, the taxes and all the extra
insurance costs, even if even if it's a forty five
thousand dollars vehicle, at the end of the day, it's
going to cost more than that, right, and so I'm
nervous about that. But then something else gave me costs
for a concern just about buying an electric va, specifically
from one of these startup companies, and I think Rivian
(02:03):
has a lot more room to run because especially that
recent investment from VW that they got. But Fisker went busts.
Oh yeah, think about anybody who bought a Fisker car.
What happens now that these are not just cars that
run of themselves. You might not have the same support
like whendewu went bust or something like that. But these
are computers on wheels these days. Yeah, these fancier new cars.
(02:25):
And so you stop doing software updates, you stop supporting
those cars, do they become like a smartphone that doesn't
get updates anymore? So interesting, that's what makes me nervous
about buying from a startup company. So I hadn't really
thought about that. And I looked into this a little bit,
and it looks like Rivian says there's seven years of
support that they're guaranteeing, I guess to their customers, which
I don't that how they guarantee it. But seven years
(02:46):
only seven years, Yeah, that's what I was gonna say.
I was gonna say, that's actually not that long.
Speaker 2 (02:49):
No, in phone terms, it is been not in car terms, yes, exactly.
And we want folks to hang on to vehicles for
much longer than that because so We've got a twenty
twelve Honda Odyssey that we bought used, but we you've
owned it for a little over eight years now, and
so I would hate to think that, oh yeah, at
a certain point, this vehicle is going to stop running optimally.
But like also it takes away the residual value because
(03:11):
you're you, you still have value in that car even
if you were to sell it, but you might not
if it's it's a car that no longer has any supports.
A toss up though, because that's the thing. If they
continue offering support for it, you know, the value is
it's not going to depreciate nearly as quickly. Right. But
I've got to think though too with Rivian specifically, because
they're so geared to the outdoors and clean energy and
(03:32):
that's like their whole brand. There's no way that they're
going to stop it at seven years. Yeah, because I mean, well,
Tesla's well we can look at Tesla, because Tesla they
still offer support for their older model S came out
in twenty twelve. You say this and you still and
the Model S is still get still get.
Speaker 1 (03:46):
Support, true, And I think that they that will be
the case if they stay in business like. I don't
see them pulling the rug out from customers, but I
do see that running because right now they're losing money
on every car that they sell, and so how long
can they keep can is it going to take for
them to profitability? How long will they be along around?
So I guess that's that's really the key here is
if Rivian stays around, I think they'll do well by
(04:08):
their restlers, they'll do the right You're.
Speaker 2 (04:10):
Less worried about them making the right call assuming they're around.
But the big question is whether or not they are
going to be around.
Speaker 1 (04:15):
Are there many harder industries to make it in these days,
especially as EV interest kind of wanes a little bit.
We're going to talk actually more about cars here in
just a second, but I don't know. That's a question
that's on my mind. And I think the next two
years will learn a lot about what's happening in the
startup EV space, and that will either make me feel
a little more comfortable going in that direction or less comfortable,
and that will, I think influence my decision totally. Let's
(04:36):
keep talking about cars, though, Matt. In America, we tend
to think the bigger is better. I like the Ribbean
cars are kind of big, right.
Speaker 2 (04:42):
The goal tends to be, but they're not too big.
It's not like they're not like expedition platinums or giant tahoes.
Speaker 1 (04:48):
Especially the models that are coming out next, the R
two and R three, they're smaller versions, right, so.
Speaker 2 (04:53):
Whe they're more affordable.
Speaker 1 (04:54):
But it feels like what people want is like bigger, bigger,
more and more and more, bigger house, fancier car. And
that's how you know, I guess you've made it in
this country if you've got the bigger vehicle, the bigger house. Well,
some of those trends are reversing. We've talked about how
how home sizes new home sizes actually have reduced in size. Well,
the same thing is actually happening in the car market. Finally,
for the first time in a long time, people are
(05:16):
realizing how costly big trucks and SUVs are, and our
addiction to big automobiles. It's not going away in this country.
But new statistics from cos reveal how compact cars and
compact SUVs are seeing a surge of interest. So the
crossover suv segment MATT in particular, the sales of those
(05:36):
have seen a twenty plus percent point sales increase in
the first half of this year. The most popular models,
by the way, of those kinds of cars we're talking
about are twenty two thousand to twenty five thousand dollars.
This is not bad for a brand new car. SI crossovers, Yeah,
and they're just they get you up off the ground
a little bit more. I think people really like those
because they feel like an suv, but they're a micro
(05:57):
version of it exactly. But Civics and Corolla and are
feeling the love right now. They're not going to work
well for a family of six or seven, but it's
a good reminder, I think to weigh the pros of
buying a bigger ride with the cons of the higher
price tag that's attached.
Speaker 2 (06:10):
To You know, so you mentioned Corollas. Have you seen
any of these Corollas, Corolla Crosses or whatever. They're Toyota Corollas,
but they're like the crossover version of the Corolla. It's interesting, Yes,
it's it's like they're most I don't know if it's
the most affordable crossover suv, but they're gearing it as
like an suv, so it's I mean, it's got the
slope back and it's higher up off the ground and everything.
(06:31):
It's crazy off. Look that up.
Speaker 1 (06:32):
Well, the new Priuses look a lot sleeker than the
old ones. The old ones used to look so nerdy andy,
and now the new Prius terrible.
Speaker 2 (06:39):
Yeah. Yeah, it's funny how tastes and style. It's a pendulum, right,
Like it swings from one end of the spectrum back
to the other and then it kind of starts coming back.
Because we I always love station wagons and like all
of these crossover eshuvs are basically station wagons. They're just
like a little bit higher up off the ground. But
when we had our VDA passat wagon, dude that we
love that thing, and I fully embrace the fact that
(06:59):
it was a state I think as people have gotten
used to the idea of having something that's not totally
an SUV, but it's more suv than it is station wagon.
I guess like it makes me think of you, like
the best station wagons are like the old Mercedes or
the old Volvos, oh, those like from the eighties. Yeah,
it's like the exactly opposite of electric vehicles. And by
(07:19):
the way, Consummer reports, they of course are going to
highlight the best used cars under ten thousand dollars. It's
going to be the usual players that you're used to seeing,
Honda Fit, Mazda three, the Honda Accord, even the Lexus. Yes,
they actually made the list as well, So that's a
newer player, obviously made by the same company as Toyota. Yeah.
Speaker 1 (07:38):
Well, and those affordable the older you look in the
luxury car market, you're going to find that they actually
end up becoming roughly the same price as some of
the non luxury cars. Buying a twelve year old luxury
car is one thing. Buying a brand new luxury.
Speaker 2 (07:52):
Car is another. Yes, right. I don't know if you've
ever heard folks criticize Lexus as well, but they're like,
it's just a Toyota but with the leather.
Speaker 1 (08:00):
They're not wrong. I mean, I think they're nicer in
other ways. They are, but that's under the hood.
Speaker 2 (08:04):
Is about this. A lot of folks will certainly will
argue that it's a Toyoto but with leather. Another question though,
when you buy the car, should you get the warranty? Well,
we are fans of opting for a reliable make and model.
Are they just skipping the extended warranty. The worst choice
oftentimes is going to be to buy one of those
different third party warranties. One of the bigger warranty companies
(08:25):
out there, car Shield. They've been ordered to pay a
ten million dollar fine for deceiving customers. They've got advertisements,
or maybe I'm guessing at this point they had advertisements
out there. I'm sure they've pulled them down. That we're
touting the quote unquote peace of mind and the protection
that you're buying.
Speaker 1 (08:41):
Oh, it makes me feel safe, like I'm wrapped up
in a warm blanket.
Speaker 2 (08:43):
Exactly a heat nice heated blanket in cold winter's night.
But a lot of consumers found empty promises. There are
litany of repair exclusions. There's a ton of fine print
that frustrated customers and then often left them on the
hook for the repair. In addition to the over one
hundred dollars a month that they have been paying to carshield.
This warranty service wasn't accepted at many of the repair
(09:05):
shops that they claimed that they work with. And so yeah, again,
folks are just left with a subpar product, paying much
more than they needed to have. And this leads us
to make the recommendation that, similar to many different insurance
products out there, you're likely going to be better off
di wying it. So were there to be a repair
that you need to make, you're going to have the
cash in hand in the bank to be able to
(09:27):
make that repair yourself, as opposed to going through all
the rigama role in filing a claim seeing to it
that it gets accepted makes the same thing is true
with home warranties as well. I've got a buddy they
just went through that where their HVAC his AC unit.
Long story short, they denied him he had to go
to litigation or I guess he threatened litigation, and so
he entered into arbitration where they over months. Dude, I
(09:51):
mean they just gave him the run around, and then
finally they reached a settlement to where he wasn't the
full amount that it cost him to have to repair
his age back. But certainly bad taste in his mill.
Home warranty companies and car warranty companies real similar. They are.
Speaker 1 (10:04):
They promise a lot, they almost always under deliver, and
the fine print the devil's in the details, for sure.
Make sure you're paying attention to those things before you
buy one of these products, because yes, the advertising can
make it sound like, oh my gosh, five hundred bucks
a year or one hundred bucks a month, and it's
going to cover all this stuff. I don't have to
worry then if my car breaks down or whatever, I
don't have to have the savings on hand. I said,
at least one thing taken care of. It almost never
(10:27):
actually turns out to be like that in how it
plays out, similar to what your friend indored, similar to
what a lot of car shield customers endurured. So let
that be a warning to you. Another warning here, Matt,
another day, another Wells Fargo scandal. Talk about it. They
can't catch a break, and I think it's probably because
they consistently do things that screw their customers.
Speaker 2 (10:46):
Over.
Speaker 1 (10:46):
Wells Fargo is bad news bearers, and they continue to
be so they keep talking about changing the corporate culture.
That doesn't seem to happen.
Speaker 2 (10:54):
This time.
Speaker 1 (10:54):
They're being sued because of their paltry rates and enormous
fees on cash accounts. So this lawsuit is specifically being
levied by clients in the wealth management space. They're trying
to hold Wells Fargo to its fiduciary responsibilities, and fiduciary
means they are legally required to do what's in the
best interest of their customers and the estimation of their customers.
(11:17):
The point zero five percent savings are rate for uninvested
cash doesn't qualify as a fiduciary follow through, especially by
the way, when firms are paying one hundred times that amount.
So this isn't even in the ballpark. So this is
just another reminder not to do business with companies that
are terrible in general, and specifically to avoid Wells Fargo. However, Matt,
(11:39):
I also think this, if you're investing with Wells Fargo,
the paltry savings rate is likely the least of your worries.
My guess is there are fees awful funds that you're
being put in, So don't invest with the big banks.
Don't have an account with the big bank in general.
That is I think that's the big takeaway here. That's
right man, Okay.
Speaker 2 (11:55):
Here at how to money, we are always all about
you advancing in your career, right, finding some different ways
to boost maybe the fulfillment that you are deriving from
your career or from your work, but also boosting the
amount of money that you're able to make while performing
that job.
Speaker 1 (12:10):
And even better would be if you were able to
do that and work less while you're at it.
Speaker 2 (12:14):
Oh is that not? Yeah? Exactly, but there is a
reason headline from the journal and the headline read this
probably could have been maybe our ludicris headline of the
week two, but the headline read is RIZ the secret
to getting ahead at work, which only indicates the fact
that millennials and Gen X has found the word riz. Yes,
(12:34):
if they're incorporating it into the journal.
Speaker 1 (12:36):
Pretty sure my mom and dad would have read that
headline and they would have been like, I don't know
what they're doing.
Speaker 2 (12:39):
But this made me think a couple of things. First, like,
what they're talking about is charisma, of course, but soft skills.
But you got to use the cool language RIZ to
say it. Soft skills. They are in fact crucial to
career progress, right, Like it's not just about your the
resume credentials, where it is that you went to school.
Front of the show go Rick. He called these the
unspoken rules of success. This is back in episode seven
(13:02):
oh two, if you want to go back and listen
to that conversation. But mastering them I think it will,
in fact increase how much you're making there at work,
maybe increasing your RIZ. The other upside potentially that comes
with that make you better with the people you're trying
to hit on at the bar, but also genuine virtue
that is gonna trump RIZ every day of the week. Right,
And so we're just talking about being just a hard worker,
(13:23):
being kind and reliable, being humble. Nobody wants to talk
about that though, right, Like those are those aren't the
kind of words you're going to see in any headline
of any publication these days. They're not nearly as flashy.
Speaker 1 (13:35):
Virtuous man gets raise a job exactly.
Speaker 2 (13:38):
Yeah, you're right. It's for the same reason you don't
see that like emotionally healthy, well balanced family like enjoys
picnic at the part, Like nobody wants to read about that,
Like you want to read about the shortcuts or the
things that you think are going to give you the edge,
Like okay, cool, how can I get some RIZ?
Speaker 1 (13:51):
Do I need to spike my hair, like Matt, or
what do I need to do to really increase that
RIZ factor at work? And I think you're right, Matt, Like,
just doing the right thing, though, is what we want
to encourage that. That's the click bait headline version, and
the underlying truth is just be some of these basic
things that employers want and that people like. And it
doesn't necessarily have a lot to do with being incredibly flashy.
(14:12):
It's about kind of that everyday reliability, dependability, likability that
I think is going to get you ahead at work
onered percent, not in an instant. Just like everything, all
the good things in life take time. Building wealth takes time.
Getting ahead in your career takes time. But if you
exhibit these traits over a period of time and you
advocate for yourself, it doesn't necessarily have to be riz.
I think it's a little more meaty.
Speaker 2 (14:33):
And oh I like that you said meat because it
makes me think of barbecue, Like what's the best barbecue
out there? It takes hours, It takes time. It's not
something that you can just like throw in the microwave.
This no, no, no, this this butt right here. This thing's
got to smoke for ten to twelve hours. You want
to be that's quality stuff. You want to be a
brisket employee. Okay, that's exactly what you want to be.
You're in it for the long con that's right.
Speaker 1 (14:51):
Riz feels like it's this, it's this like microwave sort
of yeah, material that.
Speaker 2 (14:55):
You're the cuisine. Yeah, but there's some a TV dinner
version a lot of people that's gonna get you a lot.
Totally agree and let's keep moving, Matt. A new PayPal
study finds that splitting the bill with friends is leading
to hurt feelings. Explain, John, you and I we've split
bills before. Are you? Are you upset with me in anyway?
Every single time?
Speaker 1 (15:14):
We can talk about it right here, right now, if
you want to in front of everyone. The average American
says they are owed nine hundred and twenty six bucks
on average by friends and family, so they're holding accounts.
They're like Aunt Susan shooting pay up. Well, I would
too after we went to those over nine hundred dollars
that people owed me. It's probably not one person. They're
probably splitting up a bunch of against a bunch of
different people, right is my guess. Well, and understandably more
(15:36):
than a third of these folks feel awkward asking.
Speaker 2 (15:39):
About it right.
Speaker 1 (15:39):
Sure, you don't want to bring it up with Aunt
Susan at the July fourth hang that you just experienced
last month. They don't want to seem cheap, right. It
makes me think of a friend Matt recently, who he said, Oh,
my wife went out to dinner with some coworkers. They're
all good friends, and she said, well, I'm trying to
get this credit card rewards bonus, which sounds like something
I had A money listener would, right, something You and
(16:00):
I have something that you and I would do, and
so hey, let me pay with my credit card and
we'll settle up. You guys, pay me via Venmo, because
it's never been easier than ever before to settle up
you don't have the cash on hand, write a check whatever,
just to toss it over via cash app or Venmo. Right, Well,
she got stiffed. I think she ended up being eighty
bucks out of pocket when she should have been thirty
bucks out of pocket. I mean, just because people underpaid.
(16:23):
Lady didn't factor in the tip something like that. Maybe
one person didn't pay at all. And that's the kind
of position you leave yourself in, which if you offer
to pay for the check in order to get those points.
Speaker 2 (16:32):
Yeah, I'm having all these flashbacks from high school of
sitting in like a chili as or Applebee's being like,
but I only only had like one of the right
mozarella cheese sticks.
Speaker 1 (16:41):
Well, it's our listeners like ours, who are trying to
save money that they might say, you find yourself in
an awkward position where everon wants to split the bill evenly,
and it's like, but I just had water, yeah, yeah,
and like I didn't have the dessert either.
Speaker 2 (16:50):
I didn't eat anypion popery. Yeah, I'll just take my
check please. So I think that the people getting the
short end of the stick on this probably are most
of the time how to money listeners. They're the ones
opting for the cheaper main course whatever it is, in
order to save money while still being able to enjoy
that outing with friends. And so if the people you're
with are trying to split the bill evenly, you're likely
(17:11):
going to be paying more than you expected. It can
be an all around uncomfortable situation. So I just would say,
brief that subject, don't be don't let it be too awkward,
and also don't put yourself in a position where you
might get stiffed and it might hurt your friendships. Yeah,
by just avoiding the even bill split all together, I
think that's when you can just offer for separate checks.
But I think what's key in making sure you get
(17:31):
paid back is to nip it in the bud right like,
that's something you need to address immediately, because the low like.
Speaker 1 (17:36):
What you were going to say, show up with an
airhorn on the doorstep at six as like it says
they will pay you if you do that.
Speaker 2 (17:40):
As soon as you part ways, that's when it feels
awkward because then you're not face to face as opposed
to if you're sitting there and be like, oh, hey,
let's see, let me calculated up real quick, you owe
me this. Oh it looks like you owe me this.
No one's going to balk at that right there because
they see you doing the math. There's like if you're
text them two days later, well even like later that day,
it's kind of like, I don't know, somebody might have
moved on with their day, with their life and they're
(18:01):
not really thinking about that. So what I'm saying is
that pay for your nacho. It may not even be intentional,
but I think there can a lot of times be
confusion too as to what it is that somebody is
getting themselves, like getting themselves into because of the fact
that we all have different like more rais and customs
that we're used to that we have grown up with.
Like it makes me think about the last time I
went to top Golf and it was organized by somebody, and
(18:22):
I'm like, oh, yeah, I can make it, then let's
do it. It sounds like fun. He paid for everybody as well,
and so I don't. I'm like, oh my gosh, I
was not expecting that. Thank you so much. I was
incredibly gracious. But I'm like, it's interesting because if I
would have organized that and gotten everyone together, I wouldn't
have expected like, I'm not paying for it. No, we
just like agree to meet up, cough up the money,
(18:42):
you know, you're paying for yourself. And so I just
think a lot of a lot of times there's just
like that's where the confusion comes from. It's just folks
that have just different expectations as to what it is
that is expected out of somebody. And in that case,
I would say, when it comes to like if you're
gonna cover coffee for somebody, like just cover coffee, like,
don't expect them to like pay you back.
Speaker 1 (19:03):
I think that's sometimes how people do it. They're like, oh,
I'm gonna do this and then they'll get me next time.
But if it's not explosively stated, they might get you
next time. But if they do, like have that be
like glue that bonds the relationship even more. It's like,
oh sweet, Like we haven't a common shared unspoken language
here between us. There's like something magic, right, Like there's
this invisible magnetic attraction that takes place when you've got
(19:23):
multiple folks who are kind of, you know, think in
the same way. There's an unspoken oh yeah, you think
you view the world the same way that I.
Speaker 2 (19:30):
View the world. And that's kind of what leads to
like the growth of any relationship, right, Like it's it's
seeing the world in the same way and being.
Speaker 1 (19:36):
Like, yeah, that's right, that's how we do this. I
hate the idea of people hurting a friendship potentially irreparably
over the price of a dinner, right, and so just
try not to put yourself in a position where that's
going to be the case. But if it comes down
to it, friendship means more than money.
Speaker 2 (19:52):
Yeah, I think so, I think I'd agree. All right, Well,
we can't end the show without talking about the stock market. Jool.
So we'll get to that and other stories right after
the break. All right, Matt, we're back.
Speaker 1 (20:09):
Let's sign down to get to the ludicrous headline of
the week. And we've never done this before, but let's
get to basically every headline about the stock market at
the beginning of the ludicrous.
Speaker 2 (20:18):
It's like an index fund headline. Yeah, it's like a
collection of all the averages of all the financial stock headlines.
They were all absurd, over the top. We have to
talk about this.
Speaker 1 (20:27):
And of course the stock market experienced a decent recovery
towards the end of the week, but almost every stock
market related headline on Monday Tuesday, you was using words
like bloodbath, plunge, plummet, crash, like everything, right, every terrible
word you can ascribe to the stock market with eight
three percent down day for the S and P five hundred.
(20:48):
These news outlets, I don't know if they're just trying
to get clicks or whatever influencer reels. You were seeing
these sorts of terms thrown around, bandied about like we
were in nineteen twenty or something like that. Right, and
folks on Twitter are blaming the Fed for not acting sooner.
There were emergency interviews on CNBC mat of people talking
about how the FED had to step in and do
something right here, right now, or this is going to
(21:09):
get so much worse. And I think when we take
a step back after one bad day in the stock
market or a slight decline, that's not even a correction, right,
because a correction you typically talked about that as being
a ten percent decline. Let's look at like step back
and look at the facts, and all the incredible rhetoric
made very little sense in that backdrop. Unemployment number still
(21:32):
near historically low levels. The stock market is still up
massively over the past few years, even this year, right,
I think we're down eight percent from all time highs
at the worst of it.
Speaker 2 (21:41):
And yes, sixty.
Speaker 1 (21:42):
Four percent of the time the stock market experiences a
minimum of ten percent decline in a given year. We
haven't had a real recession of what feels like fifteen years.
We had the COVID blip, right, But the average typically
throughout the US history is fewer than every six years,
every five point something years we experienced a recession. So
the freaking out relative to historical trends is hard to fathom.
(22:06):
I didn't really understand it. While I was happening, the
panic headlines were just overwrought. They were unnecessary. What we're
experiencing right now is completely normal. Yes, I think what
we experienced over the past eighteen plus month is what
was a little bit abnormal.
Speaker 2 (22:19):
Maybe sure, yeah, yeah. It kind of makes me think
of mortgage rates over the past ten to fifteen years
and now folks are kind of freaking out at where
they are now, and it's just like, I don't know,
this actually might be a little bit more normal than
the good times that we have recently experienced. Although that
was a silver lining is mortgage rates did come down
a little bit well y as folks are looking ahead
to FED rate cuts. But what happened last week and
(22:39):
this week in the stock market, it is and it
will be par for the course for investors because your
index fund is not this glorified highield savings account that's
just going to experience far superior returns. And so what
should you do at least moving forward. Well, we've got
an article that will link to, but do not sell
your investments. Do not sell, just keep buying. Don't change anything, honestly,
(23:02):
But if you're lucky enough to have like a pre
scheduled dollar cost averaging buy on the calendar. Well, great,
good for you, that's nice, But even still, don't blow
that out of proportion because you're looking at at most
like a ten percent discount. Okay, so you're dollar cost averaging,
and so that's it's a really small purchase and you
got ten percent off of that, Like, that's that's nothing.
My penut is not going to be enough to make
(23:24):
or break anybody.
Speaker 1 (23:24):
Compared to the downside of what can happen if you're
waiting for a pullback. Think about the people waiting for
a pullback matt over the last couple of years, waiting
to invest the dry powers on the sidelines on a
big run up.
Speaker 2 (23:36):
Yeah. So if you're invested for decades from now, what
we're saying is that there is no need to make
any changes. But if you're massively freaking out though before
we even get close to bear market territory, I think
it might be time for you to just reassess your
liquid cash balance, the amount of margin that you have
on hand to make you feel comfortable. It might be
worth reassessing what investments you're in, because if you're invested
(23:56):
in a way that causes you to lose sleep. I
think it might be time to change things up. It
might be time to change your holdings.
Speaker 1 (24:01):
Let's say you're listening and you're sixty seven years old,
and you left your job last week, and you are
ninety five percent invested in stocks, and you see an
eight percent decliinent and you're like, that changes things for me.
Speaker 2 (24:12):
I get it.
Speaker 1 (24:13):
Yeah, you probably are over allocated in stocks and you
need to change the allocation in your portfolio because of
where you are.
Speaker 2 (24:20):
But it depends on who you are. Because yeah, for
the new investor, they're like, well, yeah, guys, I'm not
freaking out. I've got you know, fifty thousand dollars invested,
just got my new job a couple of years ago.
I'm doing pretty good. You know, I got fifty fifty
k invested. It's gonna look a lot different in the
if you're checking in on your balance in the middle
of the day when you're down eight ten percent and
you've got fifty k in the market as opposed to
like one point five million, right, Because yeah, there's just
(24:42):
a there's a different impact that it has on your gut.
When you say, when you see one point five million drop.
I tend to see an absolute dollar amount. Yeah, yeah, yeah, exactly,
But it's also the same percentage. But the impact that
has on your portfolio, it varies wildly.
Speaker 1 (24:55):
Yeah, and so much also has to do with your
time horizon, how much the younger worker you're describing, Matt,
has a lot of decades for a recovery to happen,
or an eight percent to feel like a blip. If
you're taking rm ds, you it required minimum distributions. The
eight percent blip it hurts to me. Yeah, it hit
You actually are locking in those losses. Yeah, I feel
(25:17):
for those folks. Okay, Matt, let's talk about online creators
and maybe what the line creators we are talking about.
Let's throw ourselves under the bus. You talking about us, Okay,
but here's the thing we're not doing is trying to
sell people expensive courses that might or might not help them.
There was an interesting article in the Free Press last
week and the headline was drop shippers get rich by
making you feel poor. And if you've watched anything on
(25:39):
YouTube ever before, which is like ninety nine percent of
the people listening, you've seen dozens of pre roll ads
for people trying to help you learn how to drop
ship because it's easy money, like anybody can do it.
You don't have to have any real expertise in order
to become an expert drop shipper. And you might have
wondered whether or not the promise of easy money was legit,
and the the answer is not really. And drop shipping
(26:03):
is basically online arbitrage. Right. You find cheap items, you
resell them elsewhere for more money, which it sounds easy,
but it's harder to actually pull off. You might create
your own Shopify website, and then you have to find
a way to get people to come buy the stuff
from you instead of buying from the other websites that
they typically use. And trust, it sounds, I guess maybe
(26:23):
like a reasonable way to make money, but it's not
as stupid simple as a one minute TikTok video makes
it seem. Yeah, And so they're saying, these influencers are saying, well,
buy my expensive course, I'll teach you how to do
drop shipping, but it's going to cost you a lot
of money, that's right, Yeah, And drop shippers in particular,
they're not making the big bucks by doing the thing
that they're supposedly teaching about they're profiting off of your
(26:45):
desire to make money, and for those folks, it's easier
just to market to amass the social media following of
folks who are going to buy what it is that
you're selling an overpriced course, rather than making a living
off of actually drop shipping.
Speaker 2 (26:58):
Yeah. I also think of like some of the different
courses out there on like investing and how like, oh,
there's like this investing newsletter or you subscribe and I'll
tell you which one is to invest in, which is
in my opinion, even more egregious because investing specifically, like
there's no limits to the amount of money, the amount
of capital that you can pour into that. It's just like,
all right, if you've got this additional if you've got
all the secrets, then why aren't all of your dollars
(27:21):
going directly into the investments that you say are going
to make me rich?
Speaker 1 (27:25):
It does not compute at all. That's always the question
I have. If you are so successful at drop shipping
or investing, why are you selling me this forty two
hundred dollars course or nineteen hundred dollars course so that
I can learn how to do the thing that you're
doing and also crush and make tons of money. Why
not just funnel those secrets to success into more drop
(27:45):
shipping or investing success.
Speaker 2 (27:46):
That's my argument because with drop shipping, I feel like
there could be an end to that. It's just like, Okay,
there's problems with scale or there's only so much arbitrage
and so many discounted items that you can find. But
with like with investing, well.
Speaker 1 (27:58):
Then is the prison you're selling the course to also
going to have trouble growing their drop s business too?
Speaker 2 (28:02):
Yeah exactly, but like that's not they're not highlighting that fact.
But that's why with investing, like in my opinion, those
courses are even worse because of the fact that there
is no limit as to the number of investments that
you can buy, the number of shares you can just
continue to invest. It's this limitless thing. But the truth
is that they're selling you a false bill of goods.
Speaker 1 (28:21):
It's right, Yeah, it's really expensive. I think more and
more online courses are out there in a variety of
different on a variety of different subjects and ways specifically
to earn money, Matt and you have to be more
careful than ever before. I'm not saying they're all garbage,
they're all worthless. Like you'd never ever want to spend
a dollar on any online course from anyone, but especially
(28:45):
given kind of the age we live in of books, audiobooks, podcasts, blogs,
there's a lot of there's just so much free information
out there. Is it true that you need to pay
somebody big bucks to learn their system to riches or
are there ways for you to educate yourself and decide
whether or not it's even for you or not before
you spend a lot of money to a particular influencer.
Speaker 2 (29:04):
Yeah, folks want to. They want to, They want to
hit the easy.
Speaker 1 (29:06):
Button exactly, and I think that's what a lot of
these these course creators are selling. Let's talk about house hacking, Matt.
We've we've always talked about house hacking as a way
of making additional money off of the home that you own.
Speaker 2 (29:18):
Right, this is a legitimate way to make some extra exactly.
Speaker 1 (29:20):
House hacking is a massively underappreciated approach to wealth building.
It's underrated, and a recent article though from CNN, use
the term a little differently. I saw house hacking in
the headline. I was like, Oh, I'll read that because
I love house hacking. I love what it can do
for people. But they were taking a more nuanced approach
with their definition.
Speaker 2 (29:38):
In this piece.
Speaker 1 (29:39):
They were saying, well, what if you don't just rent
out a portion of your home, but instead you rent
it out your home or part of your home by
the hour. I was like, well, that's that is interesting.
Speaker 2 (29:48):
Yeah.
Speaker 1 (29:49):
Apparently, just tons of services we've talked about a couple
of these over over the years have sprung up allowing
people to do just that. So if you have a
swimming pool, for instance, they're swimply, you can rent that
out by the hour, so instead of using that's.
Speaker 2 (30:01):
One of my favorites. Yeah, the fact that it's adorable.
Speaker 1 (30:03):
Right, But let's say you want to, oh I want
to do a pool party for my daughter or my
son this weekend. Swimply you just rent the person's backyard
in their swimming pool for eighty bucks an hour or
whatever it is. And that's pretty cool.
Speaker 2 (30:15):
What if they're like Airbnb there and they're like, no parties.
Don't you gotta read fine print. You gotta read fine print.
But it is cool.
Speaker 1 (30:21):
And let's say you have a swimming pool and you're
like I'm not using it, or I don't mind hearing
the joyful glee of children in my backyard when I'm
not using the swimming pool. You can rent that out
and make some extra Money's pretty cool. There's peer space
for renting out your beautiful yard, let's say, if you
have one for pictures or your other space. Curb flip
which allows you to rent out a parking space if
you have a desirable parking space, or neighbor dot com.
(30:43):
Pretty sure we talked about this one before too, Matt.
You can rent out a portion of your house, not
to a person to stay there, but so they can
keep their items there right for storage, so stuff, Yeah,
instead of going to one of the storage facilities, Well
maybe you can find someplace closer and cheaper because a
neighbor has a garage that they're not using to the
fullest extent, and you get to use a portion of
(31:04):
that for a small monthly fee, and you, as the
garage owner, can make side income from something that was
previously going unused. And so you're not going to make
as much money via this house hacking method, but it
could help bring in some extra revenue. Makes I think
even there was a service we talked about a while
back called baby equip and you can rent out the
baby equipment that you're not using. There's all sorts of
(31:26):
ways to make.
Speaker 2 (31:27):
For folks who are traveling, maybe in the city where
you live, and it didn't make sense for them to
bring along their bob stroller or something like that, and
you've got one of those on hand, and.
Speaker 1 (31:35):
They're saving a little bit of money, you're making a
little bit of money, And I just I love that
there are unique ways to make additional money that aren't
just gig work. Right, that's not just trading your time
for money, which is something we talk about as like, yeah,
maybe for a short period of time, it makes sense
to do a gig job, but does it make sense
to have a gig job in perpetuity. Well, some of
these things are at least trading your assets some of
(31:58):
the use of your assets for money instead of your time,
which is more valuable. Yeah, this is a form of
arbitrage that might work for you where you don't have
to pay for that expensive online course to learn how
to do But uh, all right, that's gonna.
Speaker 2 (32:10):
Be it for today's Friday flight. We'll see you back
here on Monday. We'll have a fresh ask How to
Money episode lined up for you. If you've been listening
to the show and you've found it valuable, we would
love it if you left us a review over at
Apple Podcast, wherever it is that you might be listening
to this episode of How to Money right now, and
leave us a solid one over there and a big
thank you in advance. But Jill, that's going to be
(32:30):
at Buddy, So until next time, best friends Out, Best
Friends Out.
Hosts And Creators
Joel Larsgaard
Matthew Altmix
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