November 23, 2025 • 33 mins
Apple has launched a new 'sock' to store your phone. It costs $230! Joel & Matt talk about ridiculous overpriced items.
Ask HTM: Steve is worried about AI's impact on his small business. Should he change his investments?
Electric vehicles are losing their luster. And prices remain high on EVs. Run the numbers for how you drive before you opt for an EV over an ICE!
Ask HTM: Jordan wants to know about switching banks and whether it's worth it or not.
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:01):
I am six forty. You're listening to How to Money
on demand on the iHeartRadio app.
Speaker 2 (00:10):
All Joel and Matt want to do is help you save,
invest and enjoy more of what matters. This is how
to Money with Joel lars Guard and Matt Altmix.
Speaker 3 (00:30):
KFI AM sixty live everywhere on the iHeartRadio app.
Speaker 4 (00:34):
This is how to Money. I am Matt Altmix and
I'm Joe Larsgard.
Speaker 1 (00:37):
If you're on Facebook, by the way, you want to
join a group of like minded folks who have money questions,
who have money insights, please go join the how to
Money Facebook group.
Speaker 3 (00:46):
It is now time for the ludicrous headline of the week,
which is from CNN, which I will say, I feel
like CNN has been putting out some better news recently
over the past couple of years.
Speaker 4 (00:55):
Some good, good business news. Yeah. Yeah, not even the
past couple years. I feel like over the past several months.
Speaker 3 (01:00):
But this is a funnier story from CNN and the
headline read Apple launches a two hundred and twenty nine
dollars ninety iPhone pocket sock to widespread the amusement, and
I'm so abused too.
Speaker 4 (01:14):
I was quite amused myself. It's funny.
Speaker 3 (01:17):
Apple has been highly successful at monetizing desire through their
in particular through their design. But I can't imagine anyone
out there is going to desire a glorified sock to
store your phone in for the high price of two
hundred and thirty dollars.
Speaker 4 (01:32):
And if it was a twelve dollars sock, I'd be like,
all right, guys, that's cool. Whatever.
Speaker 3 (01:36):
Like people, if it's a twelve dollars sock, You're like,
I'll get it. And it's the stocking stuffer. Yeah, it's funny,
but they're kind of going like the Gucci route, except
for dude, you know what the so you know, the
soccer reminded me. It looks like like a MANKINI from
like Borat, Yeah it does. It does because it's like
this long, stretchy sock. Yeah, it's I mean, you can't
(01:57):
make it up. It's pretty ridiculous. It's stupid.
Speaker 1 (01:59):
It is something is like the Apple brand halo damaged
by releasing a ridiculous product at this price.
Speaker 4 (02:05):
Though.
Speaker 1 (02:06):
I think at some point people are like, wait a second,
are you just trying to get my money without giving
me anything of value in return? I think, so I
feel like it eradicates or at least reduces my trust
in humanity.
Speaker 4 (02:18):
And I hope this product.
Speaker 3 (02:19):
Fails miserably unless they don't move any product, and then
you're like, all right, faith and trust restored.
Speaker 4 (02:25):
Yeah that's true.
Speaker 3 (02:27):
Yeah, And I hope that if they want to put
it out there and see if people buy it, like,
more power to them.
Speaker 1 (02:31):
But hope they get stuck with a million boxes exactly,
and then they have to get they're giving them away
because I guarantee the socks costs roughly a dollar and
eighty two cents to make, Yeah, like eighty two cents,
So the profit margin on it is just insane.
Speaker 4 (02:43):
You know what's funny? Though?
Speaker 3 (02:43):
Okay, before it sounds like you're about to move on,
but I literally, back in the day, used to store
my iPod in a sock. And how expensive was that sock.
It was just a sock that, just like the other pair,
got a hole in it, and so I just use
the sock to store my my iPod. Sure nobody made
of you about it. My boss did. So this is
back when I used to work for the ad agency.
(03:04):
My creative director saw it one day when she was
passing my desk, and she's like, Matt, don't, don't use
this little Did she know that that was actually was
the head of the curve, the seed of an excellent idea.
Speaker 4 (03:15):
Yeah, to make ridiculous amount of money.
Speaker 3 (03:17):
Speaking of Christmas, she did get me a little actual
iPod case, a little padded fabric case with a little
beaner attached to it.
Speaker 4 (03:24):
Very much. I appreciate it. That is sweet. I used
it well.
Speaker 1 (03:27):
I was going to move on because there's other ridiculously
expensive let's let's get to pics that we should mention.
Speaker 4 (03:31):
There's multiple ludicrous headlines. Yeah.
Speaker 3 (03:33):
Wired had this article about a three hundred dollars water bottle.
Three hundred dollars for a water bottle. Explain, explain what
this water bottle did there? If if a sock is
two hundred thirty dollars, I guess sounds like a deal.
It sounds reasonable. But it's this brand called Okappa, and
they're they're touting it as and I quote, a technical
feat of engineering beyond reason for a water bottle. Matt, right,
(03:55):
they engineered the heck out of this thing.
Speaker 1 (03:57):
It's been called the Ferrari of water bottles that now
costs twelve times what a Stanley did, which was also
overpriced and ridiculous. This water bottle doesn't do anything special,
it doesn't filter your water, and worst of all, it
has a bunch of extra parts that need regular cleaning.
Does it look cool?
Speaker 4 (04:14):
Kind of?
Speaker 1 (04:14):
Yeah, yeah, kind of, But it's a I think it's
a weird new product, and free markets are fascinating to me.
I will be watching this. There was also like a
five five hundred and twenty dollars white T shirt that
I saw recently as like, oh, this is like the
premium white T shirt, and I was like, it looks exactly.
It's like a normal white teach like the Kirkland signature
white T shirt that you get I don't know, four
(04:36):
in the pack for probably twelve dollars five hundred and
twenty dollars for one shirt.
Speaker 4 (04:39):
It might come from the same factory.
Speaker 1 (04:40):
If you're into five hundred and twenty dollars white shirts,
I don't want to throw shade. If you're into three
hundred dollars water bottles.
Speaker 4 (04:45):
Do you do you?
Speaker 1 (04:46):
But I'm just hoping that these overpriced items that don't
really offer any additional value are spurned. I'm not against
spending a lot of money on something that's actually going
to make a meaningful difference in your life. But I
just don't think the water bottle or the phone side
are going to be those items.
Speaker 3 (05:01):
What's also funny, okay, so that the name of that
water bottle was Okappa, which is very similar to Ohala,
which is a two letters off, which is a superior
water bottle. Do any of your kids have a walas, Yes,
they do, and those are understructile, easy clean. I'm literally
still here with my twenty eighteen takiya. I don't even
know how you say it, takaya whatever that I got
from fin Con for free at the hotel after the
(05:24):
party that we're helping to host was cleaning up.
Speaker 4 (05:26):
And someone left their water bottle.
Speaker 3 (05:27):
You use it every day. It's a found water bottle.
I don't think I've touched or used anything so often
in my entire life.
Speaker 1 (05:33):
I'm using my free now gene given to us by
the kind folks of Bell's Brewing.
Speaker 3 (05:36):
Yeah, classic Bells. But I am considering getting an a
wala because of it's designed. It's haapers in the middle
so it's easier to grab. It's got the straw and
the spout ability to drink. I drink out of my
daughter's the other day, and I set out loud this
is in fact a superior water bottle. And with all
that praise, we're not even sponsored by o Wala. You
(05:57):
are listening to how Some Money. Now, let's go to
de Kafi twenty four hour newsroom AFI am six forty.
You're listening to how to Money on demand on the
iHeartRadio app.
Speaker 4 (06:08):
This is how to Money. I'm Joel Larsgard and I
am Matt Altmixed.
Speaker 3 (06:12):
Don't forget to sign up for the how to Money
newsletter over at how tomoney dot com slash newsletter.
Speaker 4 (06:17):
Joel.
Speaker 3 (06:17):
Let's now hear from another listener. This is a listener
who doesn't want to go all in with VU. He
doesn't want to go with an SMP ETF all the way.
He's looking to diversify. This is a question from listener Steve.
Speaker 4 (06:28):
Hey, Matt and Joel.
Speaker 5 (06:30):
My wife and I are currently at money Gear seven
and assuming nothing changes in my current business, we have
already reached cost FI. We both max out our four
one ks and rawth irays on January first each year,
and we doll our cost average into a brokerage account
every month, so if nothing changes, we should easily be
fully fired in five to ten years. I'm currently forty
(06:51):
five and own my own business, but I'm guessing I
have four to five years tops before AI puts me
out of a job, forcing me into FI.
Speaker 4 (06:59):
Whether I'm ready or not.
Speaker 5 (07:00):
It's not the worst thing, but I'd hate to have
to start drawing down funds to live off of if
we're in a recession. My plan thus far has always
been to invest solely in VT SACKS, which is a
total stock market fund, since I theoretically won't need the
funds for at least a decade. But now that I
see the strong potential of being forced into retirement early
by AI, I'm wondering if I shouldn't be a bit
(07:23):
more conservative. On top of this, I'm increasingly concerned that
we're in an AI bubble, with much of the gains
in the market tied to those AI companies. So if
AI keeps growing, it puts me out of work. But
if it's actually all smoke and the bubble bursts, it
cuts into my portfolio. So my question is what it
makes sense to start shifting future stock purchases into something
(07:44):
more like Vanguard's value Index fund. When I look at
the holdings, VT SACKS is thirty eight percent tech, where
VVIAX is only seven point five percent tech, so much
lower on the tech. My thinking is this would keep
me aggressively in the market, but would start diversifying my
portfolio away from being so tech heavy. Furthermore, I keep
(08:06):
losing faith in the future stability of the US for
all sorts of reasons, so I'm also considering diversifying a
percentage into Vanguard's Total International Stock Index to protect against
the potential of future US in stability. I get that
this all sounds like timing the market, and it complicates
things way beyond just dumping everything into VT SACKS, but
(08:28):
being at cost FI, I'm willing to trade some of
that upside for a bit more peace of mind. All
that being said, would shifting to something closer to fifty
percent total stock market, twenty five percent growth twenty five
percent international makes sense in my situation? Or am I
just overthinking things way more than I need to? Thanks guys.
Speaker 1 (08:49):
Oh see, Oh Steve, do you think he's overthinking it?
I don't think he's overthinking it. I think you've put
a lot of thought into this, and I think it's admirable. Yeah,
that he's considering doom and gloom headlines about what AI
could do to the job market or will do to
specific sectors. But he's he's really thinking through kind of
(09:11):
long term ramifications of what it means for his particular job,
his overall portfolio. And he's not This is not a
knee jerk reaction like when he talked when he mentioned
not wanting the time to market. That's not the vibe
I get. No, this is this isn't a timing thing.
Speaker 3 (09:25):
But I will say I there is a part of
this very small part of me that does think he's
over indexing the whole AI thing because of the fact
that it is going to impact him specifically with his
ability to continue his business.
Speaker 4 (09:37):
And I totally and in some ways you have totally.
Speaker 1 (09:39):
I totally feel that it's some ways you have to,
because it's it's almost like owning a bunch of company
stock in the company you work for, and you're like,
you're over indexed to this thing, man. And so if
you're bread and butter, if your income comes from AI,
you might want to not have as much of your
investment portfolio tied up in artificial intelligence, so I think
that is also another factor on the I love this question.
(10:01):
And by the way, Steve, I'm not sure if you
had a chance to listen to my interview with Vanguard's
Joe Davis that came out recently, I think it would
be particularly helpful for you. He's put a lot of
thought and methodology into what happens if AI crushes or
if it's kind of a lackluster and it doesn't really
do everything that Sam Altman and those bros. Are saying
(10:23):
it's going to do. He also factored in other major
trends into his analysis, and so I get that the
bubbletalk can be disconcerting, but I think Joe's work can
offer some encouragement to stay the course, which doesn't mean
we don't think you should make any changes, but I
do think it at least provides. And by the way,
email me, I'll send you his book. I've got an
(10:43):
extra copy if.
Speaker 4 (10:44):
You want it.
Speaker 3 (10:45):
Yeah, coming into view, Yeah, coming into entitle of the book.
For everyone else who we will not send an extra
copy to, only sending one to Steve femails, just email us.
Speaker 4 (10:54):
We'll hook you up.
Speaker 1 (10:56):
But yeah, I think that that's those just like an
important conversation because I think it's on the minds of
a lot of people, like how is AI going to
impact not just my profession potentially, but also like the
investments that I hold as well.
Speaker 4 (11:08):
Yeah, yeah, and Steve, he's a money gear seven.
Speaker 3 (11:10):
But that doesn't mean that you are fully financially independent
or even that you want to quit working, right, doesn't
sound like you have any real debt that's weighing you down.
You've been doing a really good job investing as well, right,
Like you are fully funding your accounts at the beginning
of the year, so you are paying attention to three out.
Speaker 4 (11:26):
Of four years.
Speaker 1 (11:27):
He is a man after your own harm. My gosh
on that regard, I love that you love a January first,
full fund.
Speaker 4 (11:32):
Pull the trigger and make it happen.
Speaker 3 (11:34):
Yeah, being in that position is going to give you
a lot of cushion and flexibility. But still, retirement isn't
always something that we choose to do, right, And my
guess is that you could still use some of your
skills in other ways if AI were to crush your
small business. But that being said, you may not want
to do those things, and you may not have to
if you've built up a large enough nest egg and
(11:54):
it's well diversified. Yeah, Steve kind of points to the
fact that he's kind of in this weird situation where like,
AI's bad for business, but it's good for good for portfolio.
As he's looking at his nest egg, I kind of
think he's in the perfect position, right, because like, you
are perfectly hedged to a certain extent, because you're diversified
in that way at least, because yeah, if you know
you're he's worried about the portion of his overall portfolio
(12:18):
being in tech and if it takes off, well, guess what,
you can't afford to retire early. But if it doesn't
and it does pop, turns out you're in business for
another ten twenty years. Perhaps No, But I think that's
what he's saying too, though, is like, actually, if the
bubble burst, I'm impacted. He thinks maybe, yeah, maybe you're right,
Maybe maybe that keeps his business around longer. Yeah, that's
what he's saying, but maybe it doesn't. I think he
said it as like a negative in that, like, well,
(12:40):
it's it's just an awkward position. But actually I sort
of see that as a good thing because if it
does well, well you got a little bit of that
if it does poorly, Okay, well you got a little bit.
Speaker 1 (12:49):
Of that as well. That's that might be a good point.
But the hardest efs question is about his portfolio allocation
and VT sacks. The VT sacks and chill can be
kind of a great energy for a lot of investors.
VT sacks, by the way, if you're listening to here,
like what is that, it is a Vanguard ETF Total
stock Market ETF, and it is incredibly inexpensive, and so
(13:10):
that is like one of the funds that's highly recommended, Matt,
your equivalent, Oh, that's the mutual fund. The ETF is
VU right, Well VU is the SMP. Okay, So then
vt I VTI. That's what so bt total Vanguard's Total
stock market ETF. So BTI is the ETF version of
VT SACKS. So that simplicity is crucial. It's it's certainly
(13:32):
not the right mix for everyone.
Speaker 6 (13:34):
Right.
Speaker 1 (13:34):
Your timeline, your individual investor timeline is crucial. And the
reality is that Steve might he might need to start
tapping those funds in half a decade. So I lean
here towards Steve's line of thinking. Matt, right, he's he's
not making this knee jerk decision based on headlines. His
risk profile truly is changing, and he is getting closer
to the wealth preservation stage of his life.
Speaker 4 (13:56):
That's a kind way of saying he's getting older.
Speaker 1 (13:58):
Well that, but he's also much younger than most people
are going to be tapping their retirement fronts, because it
doesn't sound like he's anywhere close to traditional retirement age.
He is just getting closer to saying I'm financially independent
and I might not be working anymore. And because of that,
he's going to want to stay heavily weighted towards stock
still because he is young, but not being as tech
(14:19):
and as US centric would de risk things for him,
given kind of where things stand in his personal situation.
Speaker 4 (14:25):
Yeah, not being quite as exposed.
Speaker 3 (14:27):
One of the other things that Steve mentioned was not
selling his current holdings but buying those other funds with
new investment dollars, which I think is a really smart
way to rebalance. That's actually something that Joe mentioned in
that interview, Joe Joel when you talked with him, that
it's like slowly gently moving the rudder as opposed to
jerking the wheel to one side in the new fishtail crash,
(14:49):
a lot of people want to go like sell positions
and buy positions, and Joe's thing was like, just see
he's into it. Slowly buy the new position and you'll
you'll rebalance over.
Speaker 4 (14:57):
Time, exactly.
Speaker 3 (14:58):
Yeah, So increasing exposure everyone with those new investments means
that over the next few years you're going to be
changing your investment mix in a meaningful way. Without some
of those substantial changes. Now that actually could be more
headline driven, perhaps with it being more in.
Speaker 4 (15:13):
The news lately.
Speaker 1 (15:14):
Yeah, and Steve he's still looking at low cost Vanguard funds,
which is brilliant of course. And you know he mentioned
he's experiencing less growth by potentially making these changes. That
might be true, it might not be right, Like recent
history would say that you're stupid to opt for less
tech exposure. It would be like, no, no, no. The
fact that you're not invested solely in the mag seven
(15:34):
means you're a moron, right, But that could change quickly, right,
And it's really hard to know when or how or
if that's actually going to come to pass. And so
your goal at this point in your money progress in
your journey isn't to maximize returns as much as possible.
It's to be prepared for upcoming changes.
Speaker 4 (15:54):
Matt.
Speaker 1 (15:54):
You mentioned the term hedging. It's to be hedged to
make sure that you're not exposed on the underside. You
have this soft underbelly because you didn't take into account
changes in investor sentiment that could negatively impact you if
you were all in on one on one fund and
so know what you're after make changes for that reason.
(16:16):
It's going to help ensure that you don't cake yourself
for missing out on higher returns if that's what comes
the past, because you might be like dang, I did
the wrong thing. And no, just because you didn't get
higher returns doesn't mean you did the wrong thing. You
could have still easily done the right thing for yourself
for your own risk tolerance given what's happening in your
life and the potential loss of your business.
Speaker 3 (16:37):
Yeah, and you are listening to how to Money. This
is Joelarsguard and Matt Altmix.
Speaker 1 (16:42):
And you're listening to k IF I Am six forty
how to Money on demand on the iHeartRadio app.
Speaker 4 (16:49):
This is how to Money.
Speaker 3 (16:50):
I am one of your hosts, Joelarsgard and I am
matt altmixed by the way. You can always find more
money saving information over at howtomoney dot com.
Speaker 4 (16:59):
Let's how about cars.
Speaker 1 (17:01):
Everyone thought Toyota was crazy when they doubled down on
hybrids and they said, we're just not going to get
into the EV game right now.
Speaker 4 (17:08):
I didn't think it was crazy, Yeah.
Speaker 1 (17:10):
Hybrids, hybrid's of all, A lot of people did think
about VW going like, hey, we're going all in on this,
and a lot of car makers were like, we got
to come up with an EV lineup. People, This is
the future full.
Speaker 3 (17:23):
EV by twenty twenty eight, right, I remember the Super
Bowl ads right, al though, but I feel like now
Toyota's looking crazy like a fox because the whole EV
spaces and turmoil.
Speaker 1 (17:33):
Brands have not found a way to reliably produce vehicles
that turn a profit. Consumers are less interested as tax
credits are evaporating, so car brands are attempting to pivot.
Ford basically said hey, we're probably going to stop making
the Ford Lightning even though it's the best selling EV
truck on the market. It turns out that title doesn't
really mean much because unit sales are still pretty pretty
(17:55):
paltry and it's just really expensive to get into a
new EVV these days. I think you know that Ford
Lightning was supposed to start at forty grand but an
entry level model. Now it starts like sixty thousand, so
prices skyrocketed on them. I remember when they announced the
Ford Lightning at forty k and I was like, yeah,
I might be in for that, but then the price
(18:16):
went up dramatically and I was like, yeah, no, I'm
not going to buy one for sixty grand. So I
think car companies are going to have to find a
way to bring down production costs to peak interest or
just stop making cars that don't sell. And so I
think we are going to see kind of a pairing
down of electrical electric vehicle offerings as many manufacturers are
just like, we don't know how to turn a profit
(18:36):
on these.
Speaker 3 (18:37):
That's right, Okay, So, speaking of car expenses, we've known
that poor or even non existent credit history can have
a pretty wide ranging impact on your personal finances, including
increasing the cost of car insurance in most states. Well,
there is a recent NPR investigation and they found that
the impact can be massive. And so in that report,
the same applicant with the only difference being a poor
(19:00):
or excellent credit score, it could actually pay thousands of
dollars more in premiums annually. And this is another instance
of where you may not totally agree with how it
is that we are calculating credit scores and the system's
not perfect, but it is another reason to know the
game and to play by the rules. It's like, so
much of our episode today is just like, we don't
(19:21):
love how this is happening, but we want you to
have the knowledge and know how this is impacting your
personal finance.
Speaker 1 (19:26):
Do we love how much like influence and power the
three credit bureaus have and do we like how they
wield their influence and power?
Speaker 4 (19:33):
But they're not awesome. That's not for debate right now.
Speaker 3 (19:35):
What's up for debate is what it is that you
can do as an individual to better your personal standing.
Speaker 1 (19:40):
You need to know your credit score, and you need
to make sure that it's solid because and that typically
needs like seven forty or above.
Speaker 4 (19:47):
Is really the goal we're shooting for. If that's the case.
Speaker 1 (19:50):
And I think you said most states, Matt, I think
it's three states that don't allow credit scores to influence
what you pay for car insurance. But other than that
in the forty seven states, it's fair game. And so
if you if you live in the majority of the
United States of America, paying attention to your credit score
is going to help you pay less YEP for car insurance.
While we're talking about cars, Matt, let's do one final story.
(20:12):
Let's talk about car technology. I think one of the
reasons I don't love renting cars because it's kind of expensive.
But the thing I do love about renting cars is
you get to kind of test drive something you've never
experienced before. Like I test drove a Subaru ev last
time I rented a car, and I was like, this
is fun. And then it was a Toyota Sienna and
I'm like, ooh, this is different than my Honda Odyssey.
(20:32):
Because I'm such a middle aged man and love to
test drive minivans Like that's I never would have said
that twenty years ago.
Speaker 3 (20:38):
I've been fans highly underrated, We've lost allar Street credits.
Speaker 4 (20:42):
You don't need to do is talk to my neighbor.
Speaker 3 (20:43):
They just they got an expedition, which is a big Yeah,
their family is growing, But I'm like, why haven't you
considered a minivan? Like if you just go on one
little trip with us. You could totally be a minivan
car salesman. Yea, aside from the fact that it's just
old and kind of smells like when you get you
to the space, the automatic doors, there's no nice there's
no having to.
Speaker 4 (21:04):
Like lift that baby seat way up high you get like.
Speaker 3 (21:07):
In some of these cars, man, like you have to
raise the baby seat up like six feet up in
the air to lash it into the car base so
that any fans, they ride so smooth too, They're wonderful. Yeah,
they're so great. So everyone out there considered the minivan.
But one of the things I love is car play, right,
It's so nice compared to my cars are so old.
Speaker 4 (21:26):
Yeah, I don't have that. Yeah, I've got literally an
ox jack.
Speaker 1 (21:29):
Which my car's in six, so it means it was
probably the first year that they put those in, and
so I'm glad I have it.
Speaker 3 (21:35):
Oh yeah, the auxiliary jag was a feature. Yeah, you
see it as a bug. That meant it was high
end back of No, I think it's very exactly. But
I love how like when I get into my rental car,
it just kind of automatically connects and I can play
stuff for my phone.
Speaker 1 (21:47):
It's super simple. Well, GM announced that it's ditching car
Play in all of its new cars in favor of
its own proprietary software, and I gotta imagine, Matt, that
people are going to be far less interested in GM
cars because of this. This seems like a really bad move.
Totally agree the you know, the Apple and Android.
Speaker 4 (22:04):
They make it free.
Speaker 3 (22:06):
It's free software, and consumers like it because guess what,
it works really well with their phone. I gotta it
looks just like an iphonexcept for it's on car Play. Yes,
a proprietary Why would I not want that?
Speaker 1 (22:16):
GM software is not going to be better than this,
So this might be GM shooting itself on the foot.
Speaker 3 (22:22):
Well yeah, and you know, you know why they're doing this,
probably right like they're trying to get subscriptions. Because if
you are using your iPhone and it's playing through CarPlay,
guess what you're not using. You are not using their
built in navigation. Guess what you're not using. You're not
using the free Wi Fi that they include with a
purchase of a new vehicle. So my in laws I
think they get like one year free of like a
Wi Fi hotspot. So they're able to use Wi Fi
(22:44):
off their vehicle, and you start getting used to that,
and then pretty soon once that free trials up, they're
going to start being oh, sorry, this is going to
go away, and they've got their hooks in you. Yeah,
past twenty bucks a month or else.
Speaker 4 (22:54):
I know.
Speaker 3 (22:55):
So they want some of that recurring subscription revenue, just
like all the other companies out there. Man, that plus
data of course always sells for for Top Penny as
they're looking.
Speaker 1 (23:05):
To dish up the best ads to you Top Penny.
I ever heard that in a while. You can't say that anymore.
Pennies hop penny minting pennies Man, that's right, top dollar.
What do you even talk about the fact that they
minted the last penny like two weeks ago, that's right,
something like that.
Speaker 4 (23:16):
I was sad, but not really, No, you aren't, because
we've been advocated. If you hate it, the fact that it.
Speaker 3 (23:21):
Costs what four point three cents to actually make a
single penny, it is like the most backwards thing it
is United State.
Speaker 4 (23:27):
It's a cute little copper things.
Speaker 1 (23:28):
They're not going to be around anymore, and so I'm
glad that we're not wastefully creating pennies anymore. I'm glad
I don't have to use them keep up with them,
but you know they were cool.
Speaker 3 (23:37):
It's gonna I'm more likely to hang onto the pennies
that we have in order to play some of the
different games we play with the kids, card games.
Speaker 1 (23:43):
The best thing to do with a penny these days
we put it on a railroad track and get smashed.
Speaker 3 (23:47):
And because then you've essentially destroyed history, do a nickel
or a court, you know, something else that they're still making.
Speaker 4 (23:53):
All right, hold on to your pennies.
Speaker 3 (23:55):
I'm just saying ten years down the line, I think
folks are going to say, oh, I wish it would
have like held on to a buck or two's worth
of pennies for like little stuff aroun the house on
one sleep for just for kicks.
Speaker 1 (24:05):
Yeah, all right, We've got actually more to get to.
On today's show, this is Matt Altmix and Joel Larsgard
and you are listening to KF I am six forty
how to Money on demand on the iHeartRadio app.
Speaker 4 (24:17):
This is how to Money. I am Matt Altmix.
Speaker 1 (24:19):
And I'm Joelarsgard. Don't forget to sign up for the
how to money newsletter. You can find that up at
how tomoney dot com slash newsletter.
Speaker 3 (24:26):
Let's know here from a listener who is considering hopping banks.
Speaker 6 (24:30):
Hey, Matt and Joel, Joel and Matt mole Jat, You
guys are awesome. My name is Jordan, a longtime listener
really since you guys debuted in twenty eighteen, and I
just have a question. I have a high yield savings
account with Ally and the rate has shifted down from
the fours into the threes, and I was just wondering
(24:51):
you know what your thoughts are on moving large amounts
of money into other high yields savings accounts offering better
eight You know you can play the credit card rewards game.
Do we play the high old savings account rewards game?
In terms of interest in things like that?
Speaker 4 (25:12):
How does that work? What are you guys thoughts on that?
All right? Thanks? Man? What you think about our celebrity nickname?
Which one do you prefer? Mole snow Jat, Snowbranjelina. That's
all I can think of.
Speaker 3 (25:24):
Tomcat was Tom Cruise and wire arts have to be
so bad, Kitty Hilmes that I don't know.
Speaker 4 (25:30):
I'm okay with it could be a way cooler.
Speaker 3 (25:31):
We'll just let it die now, just cause the boys
as people do.
Speaker 4 (25:36):
Well.
Speaker 1 (25:36):
Let's Jordan's question, Ally, that's one of the best online banks.
You've been with Ally for a really, really long time. Well,
how long do you know?
Speaker 4 (25:43):
Ten decade? Oh? I may be closer to twenty years, dude.
I mean it feels like it's been forever. It feels
like I've always been with Al. I'm like at the
age where I underestimate how long things have been. I'm like, wait,
that was twenty years ago. Now we're measuring things by
decades again. I'm old.
Speaker 1 (25:59):
But Like has great customer service, as you know, Matt.
They've got a great interface, extra perks like I like
the way they do savings buckets. They've got the no
penalty CDs, which we think is cool. They've got competitive
interest rates in the market. So why would you consider
leaving a bank like that, Jordan, just to get a
slightly better rate on savings.
Speaker 4 (26:20):
I don't know.
Speaker 1 (26:21):
I probably wouldn't make this move. I think the exception
would be if you were doing something known as soft switching,
which Matt, you and I talked about recently on a
Friday flight. Like, if you're funneling a bulk of your
savings into an account that's paying more, let's say, with
like Betterment or cit who are paying some top notch
rates right now, while you're still keeping ally kind of
(26:42):
at the center of your personal banking orbit. I think
it can make sense. But if you play the sign
up for Better Rates game on repeat and you're moving
everything over and trying to do everything under a new
bank that you you know, switching your bill, pay all
that kind of stuff, boy, that's on exhausting after a while,
doesn't I'm not sure.
Speaker 4 (27:02):
It depends on the stage of life that Jordan is in.
Speaker 3 (27:04):
He seels like he's got a bit more energy though, right,
And so typically when you're younger, you've got more time
on your hands and maybe less money, and so you're
no stone goes unturned when it comes to optimizing and
max adut on.
Speaker 1 (27:16):
I'm just throwing that out there. I still remember sign
up bonuses from I would win to every single one,
every single one. Yeah, I opened one. I would at
Chase and I had to go into a physical branch
to do it, and I think it was like three
hundred bucks.
Speaker 4 (27:28):
Really, what is this twenty ten.
Speaker 1 (27:30):
I know it was probably and there were all these
hoops to jump through and remember at the end of
the day, being like that three hundred dollars was not
worth the effort.
Speaker 3 (27:37):
Well, that's honestly, I think that's a good lesson to learn, Jordan, Like,
if this sounds appealing to you, give it a shot,
because this isn't like an irreversible decision.
Speaker 4 (27:45):
Like, give it a shot, See how it feels.
Speaker 3 (27:47):
See if you think it's worth it, especially if you're
talking about like the soft switching, like you're talking about, Joel,
where you're putting a portion of your money, like like
the portion of your emergency fund that you know you're
not going to touch. Let's say you've got a solid
six plus months whereth's of living expenses. Okay, yeah, move
that over there, and then you can just learn and say, huh,
what's that worth it?
Speaker 4 (28:05):
And the cliff not you can just undo.
Speaker 3 (28:07):
It, right, Like this is one of those two way
doors where it's easy to walk back and no harm,
no foul.
Speaker 1 (28:12):
If it's the soft switching, then where you have both
bank accounts are kept alive and they're connected, you can
transfer money back and forth within a couple of days,
and so I have multiple bank accounts. If you're doing
that and you're like, this is the place where I
keep the bulk of my savings and this is the
place where I operate my day to day. Great, why
not have a relationship with two banks? But really, when
(28:33):
it comes down to it, if you're talking about switching
all the way and abandoning ally opening up this new
bank account because they're paying half a percent more, and
let's say you've got twenty thousand dollars in savings, how
much is that actually going to move the needle. I
would want to know that before I moved all the
way over. And so, yeah, this sort of soft switching
two bank thing makes more sense to me than going
(28:55):
all the way in and ditching your current bank for
a new one that pays a slightly higher rate. But yeah,
I guess if you have a ton of cash on hand, Matt,
the benefit is more substantial. But even still play the
both bank game totally, all right.
Speaker 3 (29:08):
The Facebook question of the Week comes from Angela, and
she wrote, I frequently hear the guys extole the great
benefits of an HSA. Up till now, I have always
had my employer's hr A plan with open enrollment. I
was wondering the pros and the cons of the two.
Also kind of curious why I never hear Matt and
Jeweler reference in hr A in general. I'm a newer listener,
(29:29):
so I apologize if I have simply missed this discussion.
You have not missed the discussion, Angela. She also that's
something we've talked about. What she did miss is that
we go by mole or Jazz. So Angela, let's get
that right with the boys the fellas. Yeah, no, I
will say, Angela, thank you so much for being a
new listener. And the HRA, why don't we mention it? Well,
it's because it's a much rarer perk than the other
(29:52):
main retirement accounts that get discussed frequently iras. They are
fairly ubiquitous. Same thing with four one k's, with HSA's
as well, but HRAs are far less common and so
for those who don't know, it is a health reimbursement arrangement.
Thus again the casual nature of the arrangement. This is
something that we've talked about, but it's a real thing. Again,
(30:14):
but some companies offer this as a way to help
employees fund healthcare expenses and it's something that you're bought,
like your company, they fully fund, they fully they contribute to.
It's not something that you can do and do anything. Yeah, yeah,
it's just a better you use the money. Yeah, that's true. Yeah,
and you just submit your receipts your expenses to be
reimbursed from this account. And it's pretty nice if this
(30:38):
is something that you have at your disposal.
Speaker 4 (30:40):
Yeah, yeah, exactly. But you're right.
Speaker 1 (30:41):
I mean, like the reason we don't talk about is
just because so few people have access to one. And
I'm glad you're bringing it up because for people people
that do, especially this time of year, just recognize that. Yeah,
your employer might offer you free money for healthcare expenses,
you might incur and you might have to do less
saving on your or it might even mean that you
can contribute more to an HSA for future healthcare costs.
(31:04):
But we'll get into that too here. You might not
be able to do both. So there's really not much
for you to do except use the funds in the
HRA that your employer provides if you have them, because
your employer owns those funds, and if you don't use
them in a given year, or if you leave the company,
you lose access to those funds. So maybe you schedule
(31:25):
an elective surgery or something because you realize you're not
going to fully utilize your hr A dollars if not,
or you bump up a medical procedure into the current
year to fully exhaust those funds when you might have
waited another year. Those are just kind of thoughts on
how you might utilize the HRA to its full potential.
But kind of you kind of hinted at the question, Angela,
(31:46):
can you use an HSA and an HRA at the
same time. Potentially, you know, you can't have the traditional
HRA we were just talking about, but there are other
versions of the HRA, so this is not this has
not come without its complications. If you have a limited
purpose HR, you can use an HSA at the same time,
(32:08):
and that's the case we would say use them both.
But if you have access to one of these, the
full HR version and not the kind of light limited version,
then you cannot simultaneously have both. So which one's better
probably depends on how much your employer contributes to the HR.
But if you have a really generous employee orre offering
(32:29):
a substantial reimbursement for you every year. That's a pretty
sweet perk that I want to take full advantage of.
Speaker 3 (32:35):
Certainly something to keep in mind, especially if you're winning
another job like this is a sweet perk.
Speaker 4 (32:40):
This is a sweet benefit that you have.
Speaker 3 (32:42):
And make sure to count that into the total compensation
package that you're being offered.
Speaker 1 (32:47):
Yeah, totally, okay. Thank you as always for listening to
the show. We appreciate your time and attention. You can
always find more money saving information up on our website
at howtomoney dot com. We'll see you back here next week.
You're listening to How out of Money on k if
I am six forty. You've been listening to How to
Money with Joel Larscard and Matt All Mix and you
can always hear us live on kf I AM six
(33:09):
forty twelve to two pm on Sunday and anytime on
the iHeartRadio app
I am six forty. You're listening to How to Money
on demand on the iHeartRadio app.
Speaker 2 (00:10):
All Joel and Matt want to do is help you save,
invest and enjoy more of what matters. This is how
to Money with Joel lars Guard and Matt Altmix.
Speaker 3 (00:30):
KFI AM sixty live everywhere on the iHeartRadio app.
Speaker 4 (00:34):
This is how to Money. I am Matt Altmix and
I'm Joe Larsgard.
Speaker 1 (00:37):
If you're on Facebook, by the way, you want to
join a group of like minded folks who have money questions,
who have money insights, please go join the how to
Money Facebook group.
Speaker 3 (00:46):
It is now time for the ludicrous headline of the week,
which is from CNN, which I will say, I feel
like CNN has been putting out some better news recently
over the past couple of years.
Speaker 4 (00:55):
Some good, good business news. Yeah. Yeah, not even the
past couple years. I feel like over the past several months.
Speaker 3 (01:00):
But this is a funnier story from CNN and the
headline read Apple launches a two hundred and twenty nine
dollars ninety iPhone pocket sock to widespread the amusement, and
I'm so abused too.
Speaker 4 (01:14):
I was quite amused myself. It's funny.
Speaker 3 (01:17):
Apple has been highly successful at monetizing desire through their
in particular through their design. But I can't imagine anyone
out there is going to desire a glorified sock to
store your phone in for the high price of two
hundred and thirty dollars.
Speaker 4 (01:32):
And if it was a twelve dollars sock, I'd be like,
all right, guys, that's cool. Whatever.
Speaker 3 (01:36):
Like people, if it's a twelve dollars sock, You're like,
I'll get it. And it's the stocking stuffer. Yeah, it's funny,
but they're kind of going like the Gucci route, except
for dude, you know what the so you know, the
soccer reminded me. It looks like like a MANKINI from
like Borat, Yeah it does. It does because it's like
this long, stretchy sock. Yeah, it's I mean, you can't
(01:57):
make it up. It's pretty ridiculous. It's stupid.
Speaker 1 (01:59):
It is something is like the Apple brand halo damaged
by releasing a ridiculous product at this price.
Speaker 4 (02:05):
Though.
Speaker 1 (02:06):
I think at some point people are like, wait a second,
are you just trying to get my money without giving
me anything of value in return? I think, so I
feel like it eradicates or at least reduces my trust
in humanity.
Speaker 4 (02:18):
And I hope this product.
Speaker 3 (02:19):
Fails miserably unless they don't move any product, and then
you're like, all right, faith and trust restored.
Speaker 4 (02:25):
Yeah that's true.
Speaker 3 (02:27):
Yeah, And I hope that if they want to put
it out there and see if people buy it, like,
more power to them.
Speaker 1 (02:31):
But hope they get stuck with a million boxes exactly,
and then they have to get they're giving them away
because I guarantee the socks costs roughly a dollar and
eighty two cents to make, Yeah, like eighty two cents,
So the profit margin on it is just insane.
Speaker 4 (02:43):
You know what's funny? Though?
Speaker 3 (02:43):
Okay, before it sounds like you're about to move on,
but I literally, back in the day, used to store
my iPod in a sock. And how expensive was that sock.
It was just a sock that, just like the other pair,
got a hole in it, and so I just use
the sock to store my my iPod. Sure nobody made
of you about it. My boss did. So this is
back when I used to work for the ad agency.
(03:04):
My creative director saw it one day when she was
passing my desk, and she's like, Matt, don't, don't use
this little Did she know that that was actually was
the head of the curve, the seed of an excellent idea.
Speaker 4 (03:15):
Yeah, to make ridiculous amount of money.
Speaker 3 (03:17):
Speaking of Christmas, she did get me a little actual
iPod case, a little padded fabric case with a little
beaner attached to it.
Speaker 4 (03:24):
Very much. I appreciate it. That is sweet. I used
it well.
Speaker 1 (03:27):
I was going to move on because there's other ridiculously
expensive let's let's get to pics that we should mention.
Speaker 4 (03:31):
There's multiple ludicrous headlines. Yeah.
Speaker 3 (03:33):
Wired had this article about a three hundred dollars water bottle.
Three hundred dollars for a water bottle. Explain, explain what
this water bottle did there? If if a sock is
two hundred thirty dollars, I guess sounds like a deal.
It sounds reasonable. But it's this brand called Okappa, and
they're they're touting it as and I quote, a technical
feat of engineering beyond reason for a water bottle. Matt, right,
(03:55):
they engineered the heck out of this thing.
Speaker 1 (03:57):
It's been called the Ferrari of water bottles that now
costs twelve times what a Stanley did, which was also
overpriced and ridiculous. This water bottle doesn't do anything special,
it doesn't filter your water, and worst of all, it
has a bunch of extra parts that need regular cleaning.
Does it look cool?
Speaker 4 (04:14):
Kind of?
Speaker 1 (04:14):
Yeah, yeah, kind of, But it's a I think it's
a weird new product, and free markets are fascinating to me.
I will be watching this. There was also like a
five five hundred and twenty dollars white T shirt that
I saw recently as like, oh, this is like the
premium white T shirt, and I was like, it looks exactly.
It's like a normal white teach like the Kirkland signature
white T shirt that you get I don't know, four
(04:36):
in the pack for probably twelve dollars five hundred and
twenty dollars for one shirt.
Speaker 4 (04:39):
It might come from the same factory.
Speaker 1 (04:40):
If you're into five hundred and twenty dollars white shirts,
I don't want to throw shade. If you're into three
hundred dollars water bottles.
Speaker 4 (04:45):
Do you do you?
Speaker 1 (04:46):
But I'm just hoping that these overpriced items that don't
really offer any additional value are spurned. I'm not against
spending a lot of money on something that's actually going
to make a meaningful difference in your life. But I
just don't think the water bottle or the phone side
are going to be those items.
Speaker 3 (05:01):
What's also funny, okay, so that the name of that
water bottle was Okappa, which is very similar to Ohala,
which is a two letters off, which is a superior
water bottle. Do any of your kids have a walas, Yes,
they do, and those are understructile, easy clean. I'm literally
still here with my twenty eighteen takiya. I don't even
know how you say it, takaya whatever that I got
from fin Con for free at the hotel after the
(05:24):
party that we're helping to host was cleaning up.
Speaker 4 (05:26):
And someone left their water bottle.
Speaker 3 (05:27):
You use it every day. It's a found water bottle.
I don't think I've touched or used anything so often
in my entire life.
Speaker 1 (05:33):
I'm using my free now gene given to us by
the kind folks of Bell's Brewing.
Speaker 3 (05:36):
Yeah, classic Bells. But I am considering getting an a
wala because of it's designed. It's haapers in the middle
so it's easier to grab. It's got the straw and
the spout ability to drink. I drink out of my
daughter's the other day, and I set out loud this
is in fact a superior water bottle. And with all
that praise, we're not even sponsored by o Wala. You
(05:57):
are listening to how Some Money. Now, let's go to
de Kafi twenty four hour newsroom AFI am six forty.
You're listening to how to Money on demand on the
iHeartRadio app.
Speaker 4 (06:08):
This is how to Money. I'm Joel Larsgard and I
am Matt Altmixed.
Speaker 3 (06:12):
Don't forget to sign up for the how to Money
newsletter over at how tomoney dot com slash newsletter.
Speaker 4 (06:17):
Joel.
Speaker 3 (06:17):
Let's now hear from another listener. This is a listener
who doesn't want to go all in with VU. He
doesn't want to go with an SMP ETF all the way.
He's looking to diversify. This is a question from listener Steve.
Speaker 4 (06:28):
Hey, Matt and Joel.
Speaker 5 (06:30):
My wife and I are currently at money Gear seven
and assuming nothing changes in my current business, we have
already reached cost FI. We both max out our four
one ks and rawth irays on January first each year,
and we doll our cost average into a brokerage account
every month, so if nothing changes, we should easily be
fully fired in five to ten years. I'm currently forty
(06:51):
five and own my own business, but I'm guessing I
have four to five years tops before AI puts me
out of a job, forcing me into FI.
Speaker 4 (06:59):
Whether I'm ready or not.
Speaker 5 (07:00):
It's not the worst thing, but I'd hate to have
to start drawing down funds to live off of if
we're in a recession. My plan thus far has always
been to invest solely in VT SACKS, which is a
total stock market fund, since I theoretically won't need the
funds for at least a decade. But now that I
see the strong potential of being forced into retirement early
by AI, I'm wondering if I shouldn't be a bit
(07:23):
more conservative. On top of this, I'm increasingly concerned that
we're in an AI bubble, with much of the gains
in the market tied to those AI companies. So if
AI keeps growing, it puts me out of work. But
if it's actually all smoke and the bubble bursts, it
cuts into my portfolio. So my question is what it
makes sense to start shifting future stock purchases into something
(07:44):
more like Vanguard's value Index fund. When I look at
the holdings, VT SACKS is thirty eight percent tech, where
VVIAX is only seven point five percent tech, so much
lower on the tech. My thinking is this would keep
me aggressively in the market, but would start diversifying my
portfolio away from being so tech heavy. Furthermore, I keep
(08:06):
losing faith in the future stability of the US for
all sorts of reasons, so I'm also considering diversifying a
percentage into Vanguard's Total International Stock Index to protect against
the potential of future US in stability. I get that
this all sounds like timing the market, and it complicates
things way beyond just dumping everything into VT SACKS, but
(08:28):
being at cost FI, I'm willing to trade some of
that upside for a bit more peace of mind. All
that being said, would shifting to something closer to fifty
percent total stock market, twenty five percent growth twenty five
percent international makes sense in my situation? Or am I
just overthinking things way more than I need to? Thanks guys.
Speaker 1 (08:49):
Oh see, Oh Steve, do you think he's overthinking it?
I don't think he's overthinking it. I think you've put
a lot of thought into this, and I think it's admirable. Yeah,
that he's considering doom and gloom headlines about what AI
could do to the job market or will do to
specific sectors. But he's he's really thinking through kind of
(09:11):
long term ramifications of what it means for his particular job,
his overall portfolio. And he's not This is not a
knee jerk reaction like when he talked when he mentioned
not wanting the time to market. That's not the vibe
I get. No, this is this isn't a timing thing.
Speaker 3 (09:25):
But I will say I there is a part of
this very small part of me that does think he's
over indexing the whole AI thing because of the fact
that it is going to impact him specifically with his
ability to continue his business.
Speaker 4 (09:37):
And I totally and in some ways you have totally.
Speaker 1 (09:39):
I totally feel that it's some ways you have to,
because it's it's almost like owning a bunch of company
stock in the company you work for, and you're like,
you're over indexed to this thing, man. And so if
you're bread and butter, if your income comes from AI,
you might want to not have as much of your
investment portfolio tied up in artificial intelligence, so I think
that is also another factor on the I love this question.
(10:01):
And by the way, Steve, I'm not sure if you
had a chance to listen to my interview with Vanguard's
Joe Davis that came out recently, I think it would
be particularly helpful for you. He's put a lot of
thought and methodology into what happens if AI crushes or
if it's kind of a lackluster and it doesn't really
do everything that Sam Altman and those bros. Are saying
(10:23):
it's going to do. He also factored in other major
trends into his analysis, and so I get that the
bubbletalk can be disconcerting, but I think Joe's work can
offer some encouragement to stay the course, which doesn't mean
we don't think you should make any changes, but I
do think it at least provides. And by the way,
email me, I'll send you his book. I've got an
(10:43):
extra copy if.
Speaker 4 (10:44):
You want it.
Speaker 3 (10:45):
Yeah, coming into view, Yeah, coming into entitle of the book.
For everyone else who we will not send an extra
copy to, only sending one to Steve femails, just email us.
Speaker 4 (10:54):
We'll hook you up.
Speaker 1 (10:56):
But yeah, I think that that's those just like an
important conversation because I think it's on the minds of
a lot of people, like how is AI going to
impact not just my profession potentially, but also like the
investments that I hold as well.
Speaker 4 (11:08):
Yeah, yeah, and Steve, he's a money gear seven.
Speaker 3 (11:10):
But that doesn't mean that you are fully financially independent
or even that you want to quit working, right, doesn't
sound like you have any real debt that's weighing you down.
You've been doing a really good job investing as well, right,
Like you are fully funding your accounts at the beginning
of the year, so you are paying attention to three out.
Speaker 4 (11:26):
Of four years.
Speaker 1 (11:27):
He is a man after your own harm. My gosh
on that regard, I love that you love a January first,
full fund.
Speaker 4 (11:32):
Pull the trigger and make it happen.
Speaker 3 (11:34):
Yeah, being in that position is going to give you
a lot of cushion and flexibility. But still, retirement isn't
always something that we choose to do, right, And my
guess is that you could still use some of your
skills in other ways if AI were to crush your
small business. But that being said, you may not want
to do those things, and you may not have to
if you've built up a large enough nest egg and
(11:54):
it's well diversified. Yeah, Steve kind of points to the
fact that he's kind of in this weird situation where like,
AI's bad for business, but it's good for good for portfolio.
As he's looking at his nest egg, I kind of
think he's in the perfect position, right, because like, you
are perfectly hedged to a certain extent, because you're diversified
in that way at least, because yeah, if you know
you're he's worried about the portion of his overall portfolio
(12:18):
being in tech and if it takes off, well, guess what,
you can't afford to retire early. But if it doesn't
and it does pop, turns out you're in business for
another ten twenty years. Perhaps No, But I think that's
what he's saying too, though, is like, actually, if the
bubble burst, I'm impacted. He thinks maybe, yeah, maybe you're right,
Maybe maybe that keeps his business around longer. Yeah, that's
what he's saying, but maybe it doesn't. I think he
said it as like a negative in that, like, well,
(12:40):
it's it's just an awkward position. But actually I sort
of see that as a good thing because if it
does well, well you got a little bit of that
if it does poorly, Okay, well you got a little bit.
Speaker 1 (12:49):
Of that as well. That's that might be a good point.
But the hardest efs question is about his portfolio allocation
and VT sacks. The VT sacks and chill can be
kind of a great energy for a lot of investors.
VT sacks, by the way, if you're listening to here,
like what is that, it is a Vanguard ETF Total
stock Market ETF, and it is incredibly inexpensive, and so
(13:10):
that is like one of the funds that's highly recommended, Matt,
your equivalent, Oh, that's the mutual fund. The ETF is
VU right, Well VU is the SMP. Okay, So then
vt I VTI. That's what so bt total Vanguard's Total
stock market ETF. So BTI is the ETF version of
VT SACKS. So that simplicity is crucial. It's it's certainly
(13:32):
not the right mix for everyone.
Speaker 6 (13:34):
Right.
Speaker 1 (13:34):
Your timeline, your individual investor timeline is crucial. And the
reality is that Steve might he might need to start
tapping those funds in half a decade. So I lean
here towards Steve's line of thinking. Matt, right, he's he's
not making this knee jerk decision based on headlines. His
risk profile truly is changing, and he is getting closer
to the wealth preservation stage of his life.
Speaker 4 (13:56):
That's a kind way of saying he's getting older.
Speaker 1 (13:58):
Well that, but he's also much younger than most people
are going to be tapping their retirement fronts, because it
doesn't sound like he's anywhere close to traditional retirement age.
He is just getting closer to saying I'm financially independent
and I might not be working anymore. And because of that,
he's going to want to stay heavily weighted towards stock
still because he is young, but not being as tech
(14:19):
and as US centric would de risk things for him,
given kind of where things stand in his personal situation.
Speaker 4 (14:25):
Yeah, not being quite as exposed.
Speaker 3 (14:27):
One of the other things that Steve mentioned was not
selling his current holdings but buying those other funds with
new investment dollars, which I think is a really smart
way to rebalance. That's actually something that Joe mentioned in
that interview, Joe Joel when you talked with him, that
it's like slowly gently moving the rudder as opposed to
jerking the wheel to one side in the new fishtail crash,
(14:49):
a lot of people want to go like sell positions
and buy positions, and Joe's thing was like, just see
he's into it. Slowly buy the new position and you'll
you'll rebalance over.
Speaker 4 (14:57):
Time, exactly.
Speaker 3 (14:58):
Yeah, So increasing exposure everyone with those new investments means
that over the next few years you're going to be
changing your investment mix in a meaningful way. Without some
of those substantial changes. Now that actually could be more
headline driven, perhaps with it being more in.
Speaker 4 (15:13):
The news lately.
Speaker 1 (15:14):
Yeah, and Steve he's still looking at low cost Vanguard funds,
which is brilliant of course. And you know he mentioned
he's experiencing less growth by potentially making these changes. That
might be true, it might not be right, Like recent
history would say that you're stupid to opt for less
tech exposure. It would be like, no, no, no. The
fact that you're not invested solely in the mag seven
(15:34):
means you're a moron, right, But that could change quickly, right,
And it's really hard to know when or how or
if that's actually going to come to pass. And so
your goal at this point in your money progress in
your journey isn't to maximize returns as much as possible.
It's to be prepared for upcoming changes.
Speaker 4 (15:54):
Matt.
Speaker 1 (15:54):
You mentioned the term hedging. It's to be hedged to
make sure that you're not exposed on the underside. You
have this soft underbelly because you didn't take into account
changes in investor sentiment that could negatively impact you if
you were all in on one on one fund and
so know what you're after make changes for that reason.
(16:16):
It's going to help ensure that you don't cake yourself
for missing out on higher returns if that's what comes
the past, because you might be like dang, I did
the wrong thing. And no, just because you didn't get
higher returns doesn't mean you did the wrong thing. You
could have still easily done the right thing for yourself
for your own risk tolerance given what's happening in your
life and the potential loss of your business.
Speaker 3 (16:37):
Yeah, and you are listening to how to Money. This
is Joelarsguard and Matt Altmix.
Speaker 1 (16:42):
And you're listening to k IF I Am six forty
how to Money on demand on the iHeartRadio app.
Speaker 4 (16:49):
This is how to Money.
Speaker 3 (16:50):
I am one of your hosts, Joelarsgard and I am
matt altmixed by the way. You can always find more
money saving information over at howtomoney dot com.
Speaker 4 (16:59):
Let's how about cars.
Speaker 1 (17:01):
Everyone thought Toyota was crazy when they doubled down on
hybrids and they said, we're just not going to get
into the EV game right now.
Speaker 4 (17:08):
I didn't think it was crazy, Yeah.
Speaker 1 (17:10):
Hybrids, hybrid's of all, A lot of people did think
about VW going like, hey, we're going all in on this,
and a lot of car makers were like, we got
to come up with an EV lineup. People, This is
the future full.
Speaker 3 (17:23):
EV by twenty twenty eight, right, I remember the Super
Bowl ads right, al though, but I feel like now
Toyota's looking crazy like a fox because the whole EV
spaces and turmoil.
Speaker 1 (17:33):
Brands have not found a way to reliably produce vehicles
that turn a profit. Consumers are less interested as tax
credits are evaporating, so car brands are attempting to pivot.
Ford basically said hey, we're probably going to stop making
the Ford Lightning even though it's the best selling EV
truck on the market. It turns out that title doesn't
really mean much because unit sales are still pretty pretty
(17:55):
paltry and it's just really expensive to get into a
new EVV these days. I think you know that Ford
Lightning was supposed to start at forty grand but an
entry level model. Now it starts like sixty thousand, so
prices skyrocketed on them. I remember when they announced the
Ford Lightning at forty k and I was like, yeah,
I might be in for that, but then the price
(18:16):
went up dramatically and I was like, yeah, no, I'm
not going to buy one for sixty grand. So I
think car companies are going to have to find a
way to bring down production costs to peak interest or
just stop making cars that don't sell. And so I
think we are going to see kind of a pairing
down of electrical electric vehicle offerings as many manufacturers are
just like, we don't know how to turn a profit
(18:36):
on these.
Speaker 3 (18:37):
That's right, Okay, So, speaking of car expenses, we've known
that poor or even non existent credit history can have
a pretty wide ranging impact on your personal finances, including
increasing the cost of car insurance in most states. Well,
there is a recent NPR investigation and they found that
the impact can be massive. And so in that report,
the same applicant with the only difference being a poor
(19:00):
or excellent credit score, it could actually pay thousands of
dollars more in premiums annually. And this is another instance
of where you may not totally agree with how it
is that we are calculating credit scores and the system's
not perfect, but it is another reason to know the
game and to play by the rules. It's like, so
much of our episode today is just like, we don't
(19:21):
love how this is happening, but we want you to
have the knowledge and know how this is impacting your
personal finance.
Speaker 1 (19:26):
Do we love how much like influence and power the
three credit bureaus have and do we like how they
wield their influence and power?
Speaker 4 (19:33):
But they're not awesome. That's not for debate right now.
Speaker 3 (19:35):
What's up for debate is what it is that you
can do as an individual to better your personal standing.
Speaker 1 (19:40):
You need to know your credit score, and you need
to make sure that it's solid because and that typically
needs like seven forty or above.
Speaker 4 (19:47):
Is really the goal we're shooting for. If that's the case.
Speaker 1 (19:50):
And I think you said most states, Matt, I think
it's three states that don't allow credit scores to influence
what you pay for car insurance. But other than that
in the forty seven states, it's fair game. And so
if you if you live in the majority of the
United States of America, paying attention to your credit score
is going to help you pay less YEP for car insurance.
While we're talking about cars, Matt, let's do one final story.
(20:12):
Let's talk about car technology. I think one of the
reasons I don't love renting cars because it's kind of expensive.
But the thing I do love about renting cars is
you get to kind of test drive something you've never
experienced before. Like I test drove a Subaru ev last
time I rented a car, and I was like, this
is fun. And then it was a Toyota Sienna and
I'm like, ooh, this is different than my Honda Odyssey.
(20:32):
Because I'm such a middle aged man and love to
test drive minivans Like that's I never would have said
that twenty years ago.
Speaker 3 (20:38):
I've been fans highly underrated, We've lost allar Street credits.
Speaker 4 (20:42):
You don't need to do is talk to my neighbor.
Speaker 3 (20:43):
They just they got an expedition, which is a big Yeah,
their family is growing, But I'm like, why haven't you
considered a minivan? Like if you just go on one
little trip with us. You could totally be a minivan
car salesman. Yea, aside from the fact that it's just
old and kind of smells like when you get you
to the space, the automatic doors, there's no nice there's
no having to.
Speaker 4 (21:04):
Like lift that baby seat way up high you get like.
Speaker 3 (21:07):
In some of these cars, man, like you have to
raise the baby seat up like six feet up in
the air to lash it into the car base so
that any fans, they ride so smooth too, They're wonderful. Yeah,
they're so great. So everyone out there considered the minivan.
But one of the things I love is car play, right,
It's so nice compared to my cars are so old.
Speaker 4 (21:26):
Yeah, I don't have that. Yeah, I've got literally an
ox jack.
Speaker 1 (21:29):
Which my car's in six, so it means it was
probably the first year that they put those in, and
so I'm glad I have it.
Speaker 3 (21:35):
Oh yeah, the auxiliary jag was a feature. Yeah, you
see it as a bug. That meant it was high
end back of No, I think it's very exactly. But
I love how like when I get into my rental car,
it just kind of automatically connects and I can play
stuff for my phone.
Speaker 1 (21:47):
It's super simple. Well, GM announced that it's ditching car
Play in all of its new cars in favor of
its own proprietary software, and I gotta imagine, Matt, that
people are going to be far less interested in GM
cars because of this. This seems like a really bad move.
Totally agree the you know, the Apple and Android.
Speaker 4 (22:04):
They make it free.
Speaker 3 (22:06):
It's free software, and consumers like it because guess what,
it works really well with their phone. I gotta it
looks just like an iphonexcept for it's on car Play. Yes,
a proprietary Why would I not want that?
Speaker 1 (22:16):
GM software is not going to be better than this,
So this might be GM shooting itself on the foot.
Speaker 3 (22:22):
Well yeah, and you know, you know why they're doing this,
probably right like they're trying to get subscriptions. Because if
you are using your iPhone and it's playing through CarPlay,
guess what you're not using. You are not using their
built in navigation. Guess what you're not using. You're not
using the free Wi Fi that they include with a
purchase of a new vehicle. So my in laws I
think they get like one year free of like a
Wi Fi hotspot. So they're able to use Wi Fi
(22:44):
off their vehicle, and you start getting used to that,
and then pretty soon once that free trials up, they're
going to start being oh, sorry, this is going to
go away, and they've got their hooks in you. Yeah,
past twenty bucks a month or else.
Speaker 4 (22:54):
I know.
Speaker 3 (22:55):
So they want some of that recurring subscription revenue, just
like all the other companies out there. Man, that plus
data of course always sells for for Top Penny as
they're looking.
Speaker 1 (23:05):
To dish up the best ads to you Top Penny.
I ever heard that in a while. You can't say that anymore.
Pennies hop penny minting pennies Man, that's right, top dollar.
What do you even talk about the fact that they
minted the last penny like two weeks ago, that's right,
something like that.
Speaker 4 (23:16):
I was sad, but not really, No, you aren't, because
we've been advocated. If you hate it, the fact that it.
Speaker 3 (23:21):
Costs what four point three cents to actually make a
single penny, it is like the most backwards thing it
is United State.
Speaker 4 (23:27):
It's a cute little copper things.
Speaker 1 (23:28):
They're not going to be around anymore, and so I'm
glad that we're not wastefully creating pennies anymore. I'm glad
I don't have to use them keep up with them,
but you know they were cool.
Speaker 3 (23:37):
It's gonna I'm more likely to hang onto the pennies
that we have in order to play some of the
different games we play with the kids, card games.
Speaker 1 (23:43):
The best thing to do with a penny these days
we put it on a railroad track and get smashed.
Speaker 3 (23:47):
And because then you've essentially destroyed history, do a nickel
or a court, you know, something else that they're still making.
Speaker 4 (23:53):
All right, hold on to your pennies.
Speaker 3 (23:55):
I'm just saying ten years down the line, I think
folks are going to say, oh, I wish it would
have like held on to a buck or two's worth
of pennies for like little stuff aroun the house on
one sleep for just for kicks.
Speaker 1 (24:05):
Yeah, all right, We've got actually more to get to.
On today's show, this is Matt Altmix and Joel Larsgard
and you are listening to KF I am six forty
how to Money on demand on the iHeartRadio app.
Speaker 4 (24:17):
This is how to Money. I am Matt Altmix.
Speaker 1 (24:19):
And I'm Joelarsgard. Don't forget to sign up for the
how to money newsletter. You can find that up at
how tomoney dot com slash newsletter.
Speaker 3 (24:26):
Let's know here from a listener who is considering hopping banks.
Speaker 6 (24:30):
Hey, Matt and Joel, Joel and Matt mole Jat, You
guys are awesome. My name is Jordan, a longtime listener
really since you guys debuted in twenty eighteen, and I
just have a question. I have a high yield savings
account with Ally and the rate has shifted down from
the fours into the threes, and I was just wondering
(24:51):
you know what your thoughts are on moving large amounts
of money into other high yields savings accounts offering better
eight You know you can play the credit card rewards game.
Do we play the high old savings account rewards game?
In terms of interest in things like that?
Speaker 4 (25:12):
How does that work? What are you guys thoughts on that?
All right? Thanks? Man? What you think about our celebrity nickname?
Which one do you prefer? Mole snow Jat, Snowbranjelina. That's
all I can think of.
Speaker 3 (25:24):
Tomcat was Tom Cruise and wire arts have to be
so bad, Kitty Hilmes that I don't know.
Speaker 4 (25:30):
I'm okay with it could be a way cooler.
Speaker 3 (25:31):
We'll just let it die now, just cause the boys
as people do.
Speaker 4 (25:36):
Well.
Speaker 1 (25:36):
Let's Jordan's question, Ally, that's one of the best online banks.
You've been with Ally for a really, really long time. Well,
how long do you know?
Speaker 4 (25:43):
Ten decade? Oh? I may be closer to twenty years, dude.
I mean it feels like it's been forever. It feels
like I've always been with Al. I'm like at the
age where I underestimate how long things have been. I'm like, wait,
that was twenty years ago. Now we're measuring things by
decades again. I'm old.
Speaker 1 (25:59):
But Like has great customer service, as you know, Matt.
They've got a great interface, extra perks like I like
the way they do savings buckets. They've got the no
penalty CDs, which we think is cool. They've got competitive
interest rates in the market. So why would you consider
leaving a bank like that, Jordan, just to get a
slightly better rate on savings.
Speaker 4 (26:20):
I don't know.
Speaker 1 (26:21):
I probably wouldn't make this move. I think the exception
would be if you were doing something known as soft switching,
which Matt, you and I talked about recently on a
Friday flight. Like, if you're funneling a bulk of your
savings into an account that's paying more, let's say, with
like Betterment or cit who are paying some top notch
rates right now, while you're still keeping ally kind of
(26:42):
at the center of your personal banking orbit. I think
it can make sense. But if you play the sign
up for Better Rates game on repeat and you're moving
everything over and trying to do everything under a new
bank that you you know, switching your bill, pay all
that kind of stuff, boy, that's on exhausting after a while,
doesn't I'm not sure.
Speaker 4 (27:02):
It depends on the stage of life that Jordan is in.
Speaker 3 (27:04):
He seels like he's got a bit more energy though, right,
And so typically when you're younger, you've got more time
on your hands and maybe less money, and so you're
no stone goes unturned when it comes to optimizing and
max adut on.
Speaker 1 (27:16):
I'm just throwing that out there. I still remember sign
up bonuses from I would win to every single one,
every single one. Yeah, I opened one. I would at
Chase and I had to go into a physical branch
to do it, and I think it was like three
hundred bucks.
Speaker 4 (27:28):
Really, what is this twenty ten.
Speaker 1 (27:30):
I know it was probably and there were all these
hoops to jump through and remember at the end of
the day, being like that three hundred dollars was not
worth the effort.
Speaker 3 (27:37):
Well, that's honestly, I think that's a good lesson to learn, Jordan, Like,
if this sounds appealing to you, give it a shot,
because this isn't like an irreversible decision.
Speaker 4 (27:45):
Like, give it a shot, See how it feels.
Speaker 3 (27:47):
See if you think it's worth it, especially if you're
talking about like the soft switching, like you're talking about, Joel,
where you're putting a portion of your money, like like
the portion of your emergency fund that you know you're
not going to touch. Let's say you've got a solid
six plus months whereth's of living expenses. Okay, yeah, move
that over there, and then you can just learn and say, huh,
what's that worth it?
Speaker 4 (28:05):
And the cliff not you can just undo.
Speaker 3 (28:07):
It, right, Like this is one of those two way
doors where it's easy to walk back and no harm,
no foul.
Speaker 1 (28:12):
If it's the soft switching, then where you have both
bank accounts are kept alive and they're connected, you can
transfer money back and forth within a couple of days,
and so I have multiple bank accounts. If you're doing
that and you're like, this is the place where I
keep the bulk of my savings and this is the
place where I operate my day to day. Great, why
not have a relationship with two banks? But really, when
(28:33):
it comes down to it, if you're talking about switching
all the way and abandoning ally opening up this new
bank account because they're paying half a percent more, and
let's say you've got twenty thousand dollars in savings, how
much is that actually going to move the needle. I
would want to know that before I moved all the
way over. And so, yeah, this sort of soft switching
two bank thing makes more sense to me than going
(28:55):
all the way in and ditching your current bank for
a new one that pays a slightly higher rate. But yeah,
I guess if you have a ton of cash on hand, Matt,
the benefit is more substantial. But even still play the
both bank game totally, all right.
Speaker 3 (29:08):
The Facebook question of the Week comes from Angela, and
she wrote, I frequently hear the guys extole the great
benefits of an HSA. Up till now, I have always
had my employer's hr A plan with open enrollment. I
was wondering the pros and the cons of the two.
Also kind of curious why I never hear Matt and
Jeweler reference in hr A in general. I'm a newer listener,
(29:29):
so I apologize if I have simply missed this discussion.
You have not missed the discussion, Angela. She also that's
something we've talked about. What she did miss is that
we go by mole or Jazz. So Angela, let's get
that right with the boys the fellas. Yeah, no, I
will say, Angela, thank you so much for being a
new listener. And the HRA, why don't we mention it? Well,
it's because it's a much rarer perk than the other
(29:52):
main retirement accounts that get discussed frequently iras. They are
fairly ubiquitous. Same thing with four one k's, with HSA's
as well, but HRAs are far less common and so
for those who don't know, it is a health reimbursement arrangement.
Thus again the casual nature of the arrangement. This is
something that we've talked about, but it's a real thing. Again,
(30:14):
but some companies offer this as a way to help
employees fund healthcare expenses and it's something that you're bought,
like your company, they fully fund, they fully they contribute to.
It's not something that you can do and do anything. Yeah, yeah,
it's just a better you use the money. Yeah, that's true. Yeah,
and you just submit your receipts your expenses to be
reimbursed from this account. And it's pretty nice if this
(30:38):
is something that you have at your disposal.
Speaker 4 (30:40):
Yeah, yeah, exactly. But you're right.
Speaker 1 (30:41):
I mean, like the reason we don't talk about is
just because so few people have access to one. And
I'm glad you're bringing it up because for people people
that do, especially this time of year, just recognize that. Yeah,
your employer might offer you free money for healthcare expenses,
you might incur and you might have to do less
saving on your or it might even mean that you
can contribute more to an HSA for future healthcare costs.
(31:04):
But we'll get into that too here. You might not
be able to do both. So there's really not much
for you to do except use the funds in the
HRA that your employer provides if you have them, because
your employer owns those funds, and if you don't use
them in a given year, or if you leave the company,
you lose access to those funds. So maybe you schedule
(31:25):
an elective surgery or something because you realize you're not
going to fully utilize your hr A dollars if not,
or you bump up a medical procedure into the current
year to fully exhaust those funds when you might have
waited another year. Those are just kind of thoughts on
how you might utilize the HRA to its full potential.
But kind of you kind of hinted at the question, Angela,
(31:46):
can you use an HSA and an HRA at the
same time. Potentially, you know, you can't have the traditional
HRA we were just talking about, but there are other
versions of the HRA, so this is not this has
not come without its complications. If you have a limited
purpose HR, you can use an HSA at the same time,
(32:08):
and that's the case we would say use them both.
But if you have access to one of these, the
full HR version and not the kind of light limited version,
then you cannot simultaneously have both. So which one's better
probably depends on how much your employer contributes to the HR.
But if you have a really generous employee orre offering
(32:29):
a substantial reimbursement for you every year. That's a pretty
sweet perk that I want to take full advantage of.
Speaker 3 (32:35):
Certainly something to keep in mind, especially if you're winning
another job like this is a sweet perk.
Speaker 4 (32:40):
This is a sweet benefit that you have.
Speaker 3 (32:42):
And make sure to count that into the total compensation
package that you're being offered.
Speaker 1 (32:47):
Yeah, totally, okay. Thank you as always for listening to
the show. We appreciate your time and attention. You can
always find more money saving information up on our website
at howtomoney dot com. We'll see you back here next week.
You're listening to How out of Money on k if
I am six forty. You've been listening to How to
Money with Joel Larscard and Matt All Mix and you
can always hear us live on kf I AM six
(33:09):
forty twelve to two pm on Sunday and anytime on
the iHeartRadio app
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