Simply Money

Episode Transcript

Speaker 1 (00:08):
Tonight, we're telling you how you can combat a heavily
concentrated stock market. You're listening to Simply Money, presented by
all Worth Financial Imani Wagner along with ste Ruby.

Speaker 2 (00:17):
Let's talk about what we're talking about here.

Speaker 1 (00:20):
When I say heavily concentrated, I'm going to give you
one company name and you're going to begin to understand Nvidia, Right.
This is the company that's all over the headlines, that
has dominated the headlines even before earnings reports. At certain
points this year, the stock market has been swayed in
anticipation of what this company might say about their earnings

(00:43):
and what they're projecting for the next quarter. When one
company or a handful of companies right have that much sway,
that much power in the market, that's where you look
at periods of.

Speaker 2 (00:56):
Really heavy concentration.

Speaker 1 (00:59):
And I think it's just really really important as an
investor to be aware of this when you're thinking about
your entire portfolio.

Speaker 3 (01:07):
Yeah, it's a great point. So you know, there there's
been a lot of pull in the markets this year
from Navidia, Apple, Microsoft, Navidia honing in on that suffered
a record setting two hundred and seventy nine billion dollar route.
On Tuesday this week, it fell further after bloomboarg reported
that the Justice Department sent subpoenas to Navidia and a

(01:29):
few other companies to seek evidence that the chip maker
violated anti trust laws.

Speaker 1 (01:36):
So there are allegations out there saying that, you know,
Nvidia has become maybe in these are the allegations, maybe
not in their words, too big for their bridges. And
as the result of that, they're kind of maybe the
bully on the on the playground, and so they're telling
companies they deal with, Hey, if you don't buy all
of these particular products from us, then we're going to

(01:56):
give you a worse rate on this one particular product.
And you know, if we hear your buying from our competition,
it's going to be much harder to deal with us. Again,
still allegations, but here's what I want to say.

Speaker 2 (02:09):
I told you so, you know, I love to say
I told you so.

Speaker 1 (02:12):
I'm not saying I told you that this was going
to happen with Nvideo, but I told you that inevitably,
these big companies that feel like they are invincible and
nothing can ever go wrong with them, something inevitably does happen,
and it comes from left field, and it can be
in the form of Amazon moving.

Speaker 2 (02:29):
Into a new space, into a new sector.

Speaker 1 (02:31):
Right, it can be in the form of, you know,
now these allegations and an investigation, and this investigation has
taken a more official turn, and as the results of that, right,
that's what the markets are rebounding to.

Speaker 4 (02:43):
But as the result of that.

Speaker 1 (02:44):
Yeah, and Vidia has tumbled a bit and stumbled a bit,
which means likely your.

Speaker 2 (02:49):
Four o one K has as well.

Speaker 1 (02:52):
And if you happen to just you know, check your
four oh one K on Tuesday, you might have been like,
what the heck's happening? Well, you could potentially be too
heavily cont centraded and that one particular stock.

Speaker 3 (03:02):
Yeah, and the reason behind that, you're not. You don't
hold in the video in your four oh one k
all by itself. You don't hold an individual company stock
in your four oh one K plan. But what happens
is is, as of August thirtieth, the portfolio with a
five hundred and sixty six billion dollar spider. That's the
S and P five hundred ETF.

Speaker 2 (03:22):
Yeah, it is a big index. The tracks.

Speaker 5 (03:26):
Yeah, the S and P five hundred exactly, and this
one in and of itself, at nineteen point six percent
of that ETF is concentrated in just three stocks, which
are Apple Microsoft.

Speaker 3 (03:38):
In the video. So even though you don't have the
video yourself, when you have an S and P five hundred,
let's say that's the only investment that you have in
your four one K that that you're actually investing in,
you do have an over concentration in an individual company
stock when you're just holding the S and P FI,
the Spider S and P five hundred ft.

Speaker 1 (03:57):
Well, not only individual company stock, but these are all
tech stocks right in their periods of time when tech
stocks do better for some reasons, and there are also
times when they're not doing well. You know, I think
back a few weeks ago to investors kind of looking
at this whole AI artificial intelligence trend and saying, Okay,
these companies that I'm invested in have made huge investments

(04:18):
and research and development, and while everyone's talking about AI,
I'm not really using it maybe much in my daily life,
and so it's kind of like, well, what have you
done for me lately? And as the result of that,
there was a week or so when tech stocks weren't
doing so great, right, So if your whole four oh
one K is in this ETF, and we're big fans
of ETFs that track the S and P five hundred,

(04:40):
now we would say you need to be diversified even
beyond that. But man, you own this one ETF in
your four oh one K, and twenty percent of what's
in there could be moved by three tech stocks.

Speaker 2 (04:55):
Did you know that? Were you aware of it?

Speaker 1 (04:57):
You know, I'll go back to what I say all
the time, Steve, But if there is anything that makes
me so frustrated with investors in Americans, it is like
we spend so much time planning our summer vacations, in.

Speaker 2 (05:08):
Our kids' sports schedules and things like that, and we
don't even know what's going on with our four to
one K.

Speaker 1 (05:13):
So when we open it on Tuesday and it's down,
we don't understand why. But maybe if you did have
the understanding that these particular tech stocks were moving things
a little more than you were comfortable with, then you
would do a little more research on how you're.

Speaker 2 (05:29):
Invested in, how to be truly diversified.

Speaker 1 (05:32):
So that swings with any individual companies aren't having as
big of an impact on your portfolio.

Speaker 3 (05:38):
It certainly is an issue that's kind of unique to
the times, I would say, because if we look back
ten years in the past, the S and P five
hundred ETF spider that we're talking about here, only seven
point nine percent of the portfolio is made up of
those top stocks. So it's it's the issue here is
that these a lot of these ETFs are are market

(05:58):
cap weighted, so the guest companies within that index are
the ones that have the most pull on those on
the underlying fund price. So there are other investments out there,
like equal weighted index funds, where if it were an
equal weighted S and P five hundred fund, then all
five hundred companies within the S and P five hundred

(06:19):
have the same opportunity as each other to have a
pool on the underlying price of that fund itself. So
having everything in just an SMP five hundred fund is
not as diversified in these days as you might think,
unless it's something that's for example, price weighted rather than
market cap.

Speaker 1 (06:39):
You're listening at simply money presented by all Worth Financial
I Memi Wagner along with Steve Ruby, as we are
kind of pulling back the hood, right, looking underneath there
and saying, hey, what's in your four one k? Do
you understand what the market's doing right now? You know,
we talk about market cycles. One kind of aspect of
the cycles that doesn't get talked about a lot is
that it's some periods in time markets can be more

(07:01):
concentrated and the markets can be a little more diversified.

Speaker 2 (07:04):
Right, and so this is kind of a.

Speaker 1 (07:06):
Time when you know a lot of these index funds,
these ETFs, these mutual funds can be more concentrated in
individual stocks. A lot of people come into my office
and it'll be you know, his FOA one k in
her FA one k, and then they've maybe own a
few individual company stocks, and then they've got a couple
of iras. Each of those things individually, you know, they

(07:30):
might understand, but when you put them together, what I
find a lot of the time, correct me if I'm wrong,
is that they're missing the bigger.

Speaker 2 (07:38):
Picture, which is okay. We say, kind of a.

Speaker 1 (07:40):
Golden rule for investing is that no more than ten
percent of your overall portfolio should be impacted by an
individual stock. Right, But in a lot of cases, I'm
looking at all these pieces of the puzzle. I'm like, well,
did you know twenty percent of your portfolio is in
this particular stock or in this sector of tech stocks?
You know?

Speaker 2 (07:59):
And if those that sector has a bad day, man,
your four one K is not going to do well.

Speaker 3 (08:04):
Correcting you when you're wrong brings me a lot of joy.
But you're not wrong this time. Any you're right.

Speaker 2 (08:10):
Sorry, I can't bring you joy.

Speaker 3 (08:11):
I know, I agree with you wholeheartedly. A lot of
folks that that we work with or start working with,
will have investment accounts spread out all over the place.
I mean, I'm onboarding somebody right now. There's there's probably
ten different four to one k's from from from over
the years, some different stock accounts, and the lack of

(08:32):
uniformity between them creates sometimes over saturated positions. And we
do have software that we can analyze help us analyze
what might be oversaturated. For example, having accounts spread out
like that does not equal diversification, if some people think
that is the case. What equals diversification is making sure
that you have a uniform investment strategy across all of

(08:55):
your accounts. The easiest way to do that is by consolidating,
bringing all together, either putting them into your active four
one K or maybe creating that point of consolidation and
a rollover IRA. That's something you need to talk to
an advisor about because there are pros and cons dependent
on your own financial situation, needs and goals. But being
spread out like that can create major challenges where what

(09:16):
we're talking about today can affect you and your portfolio well.

Speaker 1 (09:22):
And this is a point not so much about concentration
in one stock, but more being aware of the totality
of your portfolio. But I also find someone will in
my office and I'll say, hey, do you have any
idea what your risk tolerance is? And they'll say, oh,
I'm really really conservative or I'm really really aggressive, And
then I actually look at their investments. In those people

(09:44):
who say they're conservative, I'm like, wow, you're eighty percent
in the stock market in twenty percent in bonds what
I had no idea.

Speaker 2 (09:52):
Or those who think they're really aggressive and.

Speaker 1 (09:55):
They're actually mostly in a target date fund where the
glide path has switched to more bond over time and
they had no idea, and it's like, gosh, this is
why your florowin k's your iras these retirement investments are
so incredibly important, and you can't look at just these
different pieces of the pie. I mean, it would be
like putting a pizza pie in the same thing with

(10:17):
like an apple pie, right, Like they they don't work
together cohesively, and so you want to make sure that
your entire pie is actually working.

Speaker 2 (10:26):
I think I'm hungry. I think that's what's happening.

Speaker 1 (10:28):
That's why.

Speaker 3 (10:29):
Yeah, that's like, do I want pizza with pineapple later?
That's whatten in my mind. I haven't had that in
a while.

Speaker 1 (10:38):
It's merely my mind actually went there too. But the
point being, you've got to understand not only you know
what your resk tolerance is, what you're truly invested in,
so that when the markets do make some swings, right,
you understand why your portfolio is being impacted. And we
also say, you know, you build the boat in times
of relative calm for the storm, understanding if you're truly

(11:02):
diversified and if you have the proper risk tolerance that
happens in times when there's little market volatility.

Speaker 2 (11:08):
So that when there are big swings, you can sleep
at night. Right.

Speaker 1 (11:11):
There is a piece of mind factor that comes from
truly understanding these concepts. Here's the all Worth advice. Don't
chase that bright and shiny ball, even if everyone else
is coming up next. When the Fed lowers interest rates,
your high interest savings account is just gonna drop quickly.
Right well, when we're gonna talk about that question next.

(11:31):
You're listening to Simply Money presented by all Worth Financial.
Here in fifty five KRC the talk station. You're listening
to Simply Money presented by all Worth Financial. I mean
you Wagner along with Steve Ruby. If you miss our
show one night, you don't have to miss what we're
talking about. We have a daily podcast for you. Just

(11:53):
search Simply Money. It's on the iheartapp or wherever you
get your podcasts. Coming up at six forty three. We're
gonna help you achieve finance independence. Even if you're in
your fifties. Then you feel like you're way behind what
you need to prioritize, what you need to think about.

Speaker 2 (12:08):
Okay, So for many of you, when we've been.

Speaker 1 (12:10):
Talking about what the Federal Reserve has been doing over
the past couple of years, right raising interest rates, we've
always said, Hey, the silver lining here is that you
can probably make more money with your emergency fund that's
sitting on the sidelines in the form of a high
yield savings account.

Speaker 6 (12:23):
Right.

Speaker 1 (12:24):
But also if you have taken advantage of that, you know,
these are rates that can change.

Speaker 2 (12:29):
And so at what point, as we have now.

Speaker 1 (12:31):
The Fed poise to lower rates for the first time
in a couple of years, what does that mean to
that yield you're getting in that savings account or the
CD or when that matures, or the money market account.

Speaker 2 (12:43):
Right, what's that going to mean for you?

Speaker 3 (12:45):
Kind of depends on how open you are to shopping
around a little bit, because I think that there's obviously
as interest rates fall, and again there's a seventy percent
chance that we're going to see a twenty five basic
basis point reduction on September eighteenth, the other thirty percent
being a fifty basis point reduction. So we finally crossed
over that mountain. We're finally talking about actual, real life

(13:08):
interest rate reductions. And yeah, we've been talking to you
about this for years. Now, take advantage of what the
Fed did with interest rates, move your money into high
yield savings, CDs, treasuries, whatever that might be. You know,
a lot of banks are going to kind of be
in a weight and see mode for how they behave
When it comes to how quickly they reduced interest rates,

(13:29):
you know, this time might be just a little different.
I would say, yeah, for how quickly they do it,
because they need to weigh the risk of losing consumer
deposits against higher margins that could come from lowering interest rates.
And some of this is being affected because this effect
is happening because of some of the banking crisis that
we saw last year.

Speaker 1 (13:51):
Well, and I think it's really interesting because when we
kind of started, when the FED started to raise interest rates,
it was like all the banks were collectively like holding
their breath, and it was like red Rover Red, I
dare fifth third bank over. I mean, it was like
who is going to k first and raise interest rates
because none of us are going to do it until
one of us does it. And it took a while
for all the banks to sort of fall in, some

(14:12):
to a larger degree than others.

Speaker 2 (14:14):
I think though, that many of us.

Speaker 1 (14:15):
Have been educated to the point where we know to
shop around. So now banks are like, wait a second,
if I lower these rates too quickly, how much am
I going to lose in deposits, and I have to
weigh that against the higher margins that are going to
come from lowering interest rates, and so I think they're
kind of taking a weight and see approach the winner
and that weight and see approach is all of us.

(14:37):
So if you haven't shopped around for those higher rates yet,
it's definitely time to do that. All right.

Speaker 2 (14:42):
If you've always wanted to live like royalty, now you can.

Speaker 1 (14:45):
The late Princess Margaret's private Caribbean Villa Le Jolieu is
now available to rent.

Speaker 2 (14:53):
I took French. I know what this is.

Speaker 1 (14:55):
It's actually the beautiful water and essentially you can stay
where the princess stayed. Were a cool you know, thirty
three to forty seven thousand dollars.

Speaker 3 (15:03):
A week a week, okay, I thought that was going
to be for a couple of years. Thirty three thousand
dollars a week to forty some it's on a private island. Mystique.
Did I say that right? Is that French?

Speaker 2 (15:18):
I believe so.

Speaker 3 (15:19):
Yeah. It's where a lot of members of the royal
family have stayed over the years. It's a five bedroom
of state. It includes an in house chef, a butler
and two housekeepers.

Speaker 2 (15:31):
Well, when you say that, I think it's like a steal.

Speaker 3 (15:33):
Yeah right, I know what a deal. Yeah, it's ridiculous.
The people that have stayed there, I guess Prince William
and Kate Middleton obviously, Mick Jagger, David Bowie, Margaret's sister,
Queen Elizabeth, some of you may have heard of her.
I think if I got together with all of those
people and we split the bill evenly, I would still

(15:53):
have struggles with making them.

Speaker 2 (15:55):
You would be the weakest link in that situation, for sure.
I would be as well.

Speaker 1 (16:00):
You know, I think about like Netflix show The Crown,
and just what the interest is now in royalty?

Speaker 2 (16:05):
Right, it's out there.

Speaker 1 (16:07):
Something like this sounds interesting and I don't know, maybe
if you could do it for a night and splurge
for your but like for a week to spend fifty
thousand dollars, which is, you know, the average income of
most families. You know, this is kind of a lifestyles
of the rich and famous, Like, gee whiz, really cool
if I could do that. I, however.

Speaker 2 (16:26):
Will not be signing up for that one anyway.

Speaker 3 (16:28):
If one of our listeners does this, can you call
in and a let.

Speaker 2 (16:31):
Us know how one or bring us along. I'm available.

Speaker 1 (16:34):
I have a bag packed, you know, at the ready
if you want me to come. I can speak French,
so if you need a little help with that, Actually
it's really really bad French. But whatever we would be,
we would be a fun week there every Sunday. You're
going to find our all Worth Advice in the Cincinnati Enquirer.
Here's a preview, right because for now, I guess we're
gonna stick with the day job. GK from Warren County says,

(16:54):
any suggestions for how to save on healthcare costs and retirement?
I do very much appreciate that gk Is answer is
asking this question because you and I have seen the
latest Fidelity research. It's for someone who is retiring today,
an individual about one hundred and sixty five thousand dollars
over the course of your retirement and healthcare costs alone.

Speaker 3 (17:16):
Yeah. So, one of Amy's favorite topics to discuss are
health savings accounts hsas. Now, in order to be eligible
for a health savings account, you have to have a
high deductible health insurance plan. If you do, it is
highly recommended to take advantage of the savings vehicle because
it is triple tax advantage. What that means is is
when you contribute to your health savings account, you get

(17:38):
a tax deduction. When you invest with the money in
that account, it grows tax free, much like wroth IRA
dollars do. When you take the money out for healthcare
distributions non reimburse qualified medical expenses, then it is a
tax free distribution. I would argue that once you're getting

(17:59):
your company Matt a four oh one K, if you
are eligible for a health savings account, that is the
next account that you should be maxing out. In a
perfect world, you are also not spending the money in
the account. You're cash flowing any medical expenses so that
you can save up for those extravagant health care costs
that we're all going to run into when we retire.

Speaker 2 (18:17):
Yeah, there's a couple keys here right.

Speaker 1 (18:19):
One of those is that that money goes into the
HSA and that it's invested. Because we see a lot
of HSA that just has money sitting there in cash
that's not going to help you. It should be invested
in growing like the money in your four oh one K.
And then to your point, Steve, if you have a
pretty robust emergency fund, right, and you would purposefully put
more money into that account to cover the out of

(18:40):
pocket healthcare expenses that you encounter along the way.

Speaker 2 (18:44):
But yeah, this can be a great way to.

Speaker 1 (18:46):
Have a pot of money that you're never going to
pay taxes on that can go toward healthcare. And when
we build financial plans for the clients that we work with,
we inflate the amount that you're going to pay for
health care significantly higher than the regular inflation rate, because
over time, that's what we've seen for anyone who has
seen a specialist or had an MRI or I had

(19:09):
an X ray when I broke my foot and I'm like,
are you kidding me? And then they wanted to x
ray it again to make sure that it was healing right,
and I'm like, I don't know, I'm feeling better.

Speaker 2 (19:16):
Do you really need to look at this?

Speaker 3 (19:17):
You know, I don't want to pay for that exactly,
we got.

Speaker 2 (19:20):
To do this again. I have to pay this cost again.

Speaker 1 (19:22):
You understand, right, what those out of pocket healthcare costs
can be. So it's really really important to plan for
those in retirement, and that planning can begin in your
twenties in your thirties go into retirement with eyes right
open about how much those out of pocket healthcare costs
can really be.

Speaker 2 (19:41):
Coming up next, we're going to.

Speaker 1 (19:42):
Talk about the power of networking to get you where
you want to go when it comes to your career.
You're listening to Simply Money presented by all Worth Financial
here on fifty five KRC the talk station. You're listening
to Simply Money presented by all Worth Financial. I Meani
Wagner along with Steve Ruby.

Speaker 2 (20:00):
For those of you who.

Speaker 1 (20:01):
Aren't exactly loving your job or your career right now,
someone might have mentioned to you you should start networking. Well,
what is networking really, what should you be doing and why.

Speaker 4 (20:11):
Is it so important?

Speaker 1 (20:12):
Joining us tonight with her fantastic perspective on all things
that have to do with your career is Julie Balki Julie.

Speaker 2 (20:18):
On the Job.

Speaker 1 (20:20):
I do hear the phrase networking being thrown around a lot,
but Julie specifically, what do you.

Speaker 2 (20:25):
Think we should be doing when it comes to networking?

Speaker 6 (20:28):
So here's my definition of networking, building mutually beneficial relationships
that support your goals. So the problem when people here
networking is they're like, I'm not doing that because they
picture the guy or the woman, the person who goes
to events, flaps everybody on the back, stoves their business
card in your hand, and then moves on. It feels icky,

(20:51):
and that's what people think of when they think of networking.
But networking is it's the building I'm an say it
against the building of the relationships that support your career goals.
And so the challenge here is what is your goal
with your networking. If it's just if it is to
make a connection at a certain company in town, if

(21:11):
it's to learn more about a certain career. And in
our personal lives, we utilize networking a lot. Get the
kids to soccer practice, you know, what's a great restaurant
you recommend? So when we build the important two relationships
and we do a good job at it, we almost
I'm going to say, I'm going to say, we almost
get to bypass really annoying things like the job boards,

(21:33):
which are just every day filled with more scammers, and
they're getting better and better. And so it to me it's,
you know, networking is a life blood of your career.
Your relationships, your professional relationships are the life blood of
your career. So therefore it requires that you put some
time and energy into it.

Speaker 3 (21:52):
So if you're let's say, helping your children who just
graduated college with recommendations and how to get out there
and at work and put their best foot forwards, how
do you bring that perception of being mutually beneficial when
when you're getting out there networking, when when you really
don't have much professional experience.

Speaker 6 (22:13):
But you know, I mean, I think it doesn't even
have to be professional experience. I networked with somebody one
time and it was clear, you know, and they you know.
I said, so you know, what exciting things you have
going on this summer or something like that. It was
I think it was at an event, and turns out
she was looking for a dog sitter. I happen to
have a killer dog sitter, so I introduced them. So

(22:36):
it doesn't that counts as a GIF. And so you
don't it doesn't have to be you know, tit for
tat all the time. It's really about an discussion when
young people are out there networking people, most most people
who are not in their twenties anymore, absolutely love helping
young people, and so we don't really expect a twenty

(22:57):
two year old to be able to help help us professionally.
But I'll tell you what, I have a lot of
twenty somethings in my life that I that I you know,
will ask them a question about social media or technology
or you know, so we all have something to give.
Even if you know, if you get in a good

(23:18):
conversation with someone and you're really good at asking them questions,
which is a part of building that mutually beneficial relationship,
it really will not come across as let me just
use you. And when I say mutually beneficial, so if
you have some great people in your network who you know,
think a lot of you professionally and vice versa, we

(23:40):
start to feel like, oh my gosh, I've got to
reach out to him once a month. No, you don't.
The idea is when people contact you for help, you
help and there and then when you need help, nine
times out of ten they're going to help you. But
you can't do this from you know, from your home
twenty four to seven. You actually have to go out
and put yourself out there and meet with people and

(24:01):
get face to face with people. And that's where I
think is really missing is that people think, well, needs
another job. I'm just going to go apply online to
one hundred jobs and something will hit No, it doesn't.
I give conversations all the time with people say I've
applied to three hundred jobs online, nobody's hiring. I'll say, no,
that is a false that's a false conclusion because if

(24:22):
you're applying to three hundred jobs, who knows if the
company or the hiring manager even saw your resume. Because
the technology on the surface has made it seem really simple,
but it actually has added many layers of complexity to
it and makes it harder to be seen, which means
that networking becomes even more important.

Speaker 1 (24:45):
Jullie, when you talk about networking, I'm going to assume
that there are two actually different kinds of networking. Networking
for those who have kind of a short term need,
right you want to make a stretch so soon. But
then also you may be perfectly happy in your career,
or you may love your boss.

Speaker 2 (25:01):
You may love your job.

Speaker 1 (25:03):
And still feel like networking is important, and I would
agree with that.

Speaker 4 (25:07):
Talk about the differences there.

Speaker 6 (25:10):
Yeah, so networking when you don't absolutely need something will
always be easier because you'll feel less like you know,
you walk in with your handout so when you have
when you realize, look, things are great today, and you've
got to internalize this. Your company wants you until the
day they don't. And so if you think everything's going
really well at work, it probably is. But what if

(25:32):
you get there on Monday and you've got a new manager.
I have a client right now who had that, who
is in that situation, and like I knew immediately that
we weren't one to see things the same way. So
things can change. And so that's why you have to
make an effort to keep those relationships and conversations alive
and help others, because if you ignore people when they

(25:54):
ask you for help or input, you're going to feel
really sheepish reaching back out to them for help when
you need something. And so you've got to keep it
going when it's short term. So what you know, because
I over the years worked with a lot of people
who are between jobs. It's hard to go from yeah,
I've got I haven't been networking for ten years. It's
hard to go from zero to sixty or wherever you

(26:17):
need to be right away. And so I will say
to them, after you get a job, do not let
these connections. Don't let them wilt on the vine, because
if you only reach out when you need something, people
will not return your call. And so that's why I'm
such an advocate for got to ask yourself, what if

(26:38):
you found out on Monday that your organization didn't need
you anymore? What would you do? Well, I'd get my
resume up to date, I'd do this and this and this. Okay, great,
but who are you going to reach out to? And
that's where people kind of go, Yeah, I know, but
it doesn't have to be something you do every week.
If you make two good conversations or coffees a month

(26:58):
with people who you have a good relationship professionally, that's enough.
And you ought to be able to work that in.

Speaker 3 (27:05):
Yeah, that's what I was gonna ask. Is this a
lunch meeting? Is this a coffee in the morning? And
you hit the nail on the head with that one.
I am curious and I just want to pivot just
a little bit here, because in this day and age,
there's a lot of job boards, there's a lot of challenges.
There's you know, you apply to three hundred jobs. When
I was younger, there was usually an opportunity to find

(27:25):
a contact at a company a hiring manager. And I
actually have a history of calling these people and saying, hey,
I applied on the job board and I wanted to
talk to you about when would be a good time
to set up an interview. And I've had some sort
of I've had some luck with that. Have we moved
away from that or we at a point where that's
just not a real opportunity anymore. Is that still good advice?

Speaker 2 (27:46):
Not at all, Not at all.

Speaker 6 (27:49):
It's fine. In fact, LinkedIn makes that easy. You just
have to have the courage to even just send a
connection and say or even to somebody you know in
that company and say, hey, I see that you have
just posted for a marketing manager and looks I think

(28:09):
based on what you're looking for, my skills seem to
be a great set. Is there someone I should talk
to in your organization to get myself, you know, to
get myself noticed. I did apply online, but you know,
I kind of I'd like to jump the pile. It's
pretty much what it is. And do you, I mean,
do you really think hiring managers want to go through

(28:30):
three hundred resume?

Speaker 3 (28:32):
Don't you think you're doing them a favor in this situation?
You are offering them something by by making it easier
because they're going to look at yours and maybe give
you that interview, right right.

Speaker 6 (28:41):
And we actually just started a new program. It starts
in July. It's called Career Launchpad. It's for gen Z
to teach them how to do these things, to give
them the courage to reach out and do these things.
And we're doing a virtual and we're doing an in
person in Cincinnati, but one virtual also and it's on
our website under Career Happiness Coaching. It's called Career launch Pads.

(29:03):
Now we're going to give these young people the tools
and the courage to do the things they need to
do to get their career off on the right foot.

Speaker 1 (29:12):
Oh I love that, right, getting them started, because these
are things you're not going to learn at your desk
on your job, but incredibly important to long term career
sex success. Great advice as always from Julie Balki. Julie
on the job, you're listening to Simply Money presented by
all Worth Financial here on fifty five KRC the talk station.

(29:35):
You're listening to Simply Money presented by all Worth Financial.

Speaker 4 (29:37):
I mean me Wagner along with Steve Rube.

Speaker 1 (29:38):
If you've got a financial question you want a little
help answering, there's a red button you can click them
while you're listening to the show. It's right there on
the iHeart app. Record your question and it's coming straight
to us. We'll help you figure it out and straight
ahead frugal habits, are they worth it? We're going to
actually get into that. I see this more often than
you would think. So if this is you who understands.

Speaker 2 (30:01):
You are not alone.

Speaker 1 (30:02):
You have done everything you can, maybe to get your
kids through college or somehow you've just fallen behind when
it comes to saving for retirement, and now you're in
your fifties and you're trying to figure out can I
ever retire?

Speaker 4 (30:15):
What can be done?

Speaker 3 (30:16):
So you got to start somewhere. In the first place
is having a finger on the pulse of your net worth.
So that's jotting down all of your assets, looking at
savings accounts, CDs, retirement accounts, subtracting from that total your
liabilities such as any credit card debts, car loans, your mortgage,
student loans if you got them or you're helping with them,

(30:37):
to give yourself a snapshot of where you stand right
now and then it's taking a deep dive into your
money in and out, so tallying up what you earn
from different sources, usually income at this point, not as
much interest from taxable accounts or something like that, and
then cross check that with your expenses that are coming out,

(30:57):
so you know how much excess cash flow you have
to earmark towards other financial priorities.

Speaker 1 (31:03):
If I was to give you just a high level
response to can you retire if you haven't done anything,
it would be yes, but you've got to get serious
about it. I think about Steve Sprovac, who had co
hosted the show with us for years, and he did it.

Speaker 2 (31:17):
He retired.

Speaker 1 (31:17):
He retired well, he's able to travel and spend time
with the grandkids and all the things that a lot
of us want to do in retirement. He was also behind.
He put the kids through college, and once they got through,
he got serious. I mean, I'm talking legal pad monthly
charting expenses. He was doing all the catch up contributions

(31:38):
in his four to one ks and his iras, saving
everything he could.

Speaker 4 (31:41):
He changed how they spent, he changed how they.

Speaker 1 (31:44):
Traveled, and the ultimate like well, the way that turned
out was that he was able to do it. He
didn't start until he was in his fifties, so there's
precedence here.

Speaker 2 (31:53):
But you can do this.

Speaker 1 (31:55):
But I think the key is you got to get serious,
and you got to get serious fast.

Speaker 3 (31:58):
Yeah, Steve sprovac is and breathing example of what we're
talking about today's You know, there's a lot of fear
the first time you sit down and work with a
financial planner and you're pulling the curtains back and exposing
what you've done or not done, and you might feel
like there's some level of judgment there. But we've seen
it all. Yes, produciary financial planners have seen it all,
and honestly, this is not that uncommon of the situation.

(32:19):
It's one of the reasons why catch up contribution contributions
exist because there's lots of folks that need to catch
up because they've made decisions that put them in a
situation where they don't have as much right now. But
then that's fine because oftentimes it's paying for children, paying
for college for children, paying for weddings, making sure that
the next generation is set up with with more opportunity

(32:42):
than you had yourself. So this isn't a bad decision
if you've done something like that, but it certainly can
create a scenario where you have to work a little
bit harder to close gaps while you still got some
runway left between now and when it is that you
want to retire.

Speaker 1 (32:56):
So you're just saying one of the major things you
have to do at the beginning is, first of all,
figure out your net worth. Then review your income, right
what's coming in in, what is going out? What are
you spending that on. I would do a deep dive
into what's on that credit card statement. How much are
you spending on eating out, how much are you spending
on travel, how much are you spending on unnecessary things.

Speaker 4 (33:16):
You may have to dial that back pretty.

Speaker 1 (33:18):
Significantly in order to focus on beefing up what you
can save. Also part of that beefing up is, yes,
the catchup contributions on four to one ks and individual
retirement accounts, but also your emergency fund. If you don't
have those three to six months of critical expenses in there,
please make that a priority.

Speaker 2 (33:36):
And I would also.

Speaker 1 (33:37):
Say one of the things that I talk to investors
that I am working with about is you want probably
even more than that on the sidelines as you're heading
into retirement, because if you happen to retire with the
bad luck of markets going south shortly after, you can
live off of that emergency fund for a while without
having to draw out of those accounts, those retirement accounts

(33:59):
that you had been saving in for years, when those
accounts are down.

Speaker 3 (34:02):
Yeah, I agree, when you're in the accumulation phase of retirement,
planning three months emergency fund as if you have a
double income household six months as a single income household
when you're entering retirement, it's okay to reach for one
to two years because it buys you time in the
event that the markets get kicked in the teeth right
when you retire. And I saw a statistic recently that
I really like. It's folks that have an emergency fund.

(34:25):
Fully funded emergency fund are seventy percent more likely to
save for retirement having that financial foundation and then saving
more for retirement in the vehicles. First of all, that
you have access to like your workplace retirement plans, a
four to one k leveraging catch up contributions. If you're
fifty this year or older in twenty twenty four, you
can save thirty five hundred dollars in a combination of

(34:47):
pre tax and or rough in your four to one K,
contributing that much annually with a ten percent return, which
is a little bit of a stretch. You have to
be investing pretty aggressively, but that could make you a
millionaire in the next fifteen years.

Speaker 1 (35:00):
Yeah. So you're maxing out your four one K, you're
maxing out your IRA. I'm gonna throw something else in
there to no one's surprised, whoever listens to the show
Health savings accounts. Yeah, I mean, when you look at
how expensive medical expenses are when you get to retirement,
this is a great way you use that emergency fund
now to pay those out of pocket medical expenses. Again,
if a high deductible health care plan makes sense for
you and your family in your particular situation. But then

(35:23):
you put that money into health savings account, that money
is invested and it grows toward retirement. And if you
were going to ask in what order should I save
in these accounts, I would say your four one K
is first, right, you got to get that company.

Speaker 3 (35:34):
Match, just the company match four one K.

Speaker 2 (35:37):
Beyond that, I would say a health savings.

Speaker 1 (35:39):
Account, then fill up the rest of that four to
one k iras. I also like but also taxable brokerage accounts. Right,
this is money not tied to a retirement account. You
can access it at any time. But when you get
to retirement, if you take money out of this account,
you're tax at a more favorable level, right, a long
term capital gains level.

Speaker 4 (35:59):
Here's the all Worth of ice in your fifties and
worried about the future.

Speaker 1 (36:02):
First of all, you're not alone, and there is still
time to turbo charge your investments.

Speaker 4 (36:07):
The key is getting serious. Next, when it's okay to
spend money on.

Speaker 1 (36:11):
Things others may think are stupid. You're listening to Simply Money,
presented by all Worth Financial. Here in fifty five KRC
the talk station. You're listening to simply Money you presented
my all Worth Financial. I may me Wagner along with
Steve Ruby. Money not going out, right, is like money
coming in. But is being too frugal actually a bad thing?

Speaker 2 (36:35):
I would make the case that yeah it is.

Speaker 1 (36:36):
I mean I think you have to have a little
bit of balance in your life.

Speaker 3 (36:39):
Oh yeah, absolutely, there's things that it's okay to splurge
on a little bit. For example, tennis shoes that get
worn down because you just won't spend money on good ones.
A good example that I use as boots. I've got
a nice pair of boots a long time ago, and
I've had them for like ten years, yeah, ten years,
and they're fine. They're perfect, they're waterproof, they're cozy. I
wear them if I'm shovel on stone the drive away

(37:01):
in the winter from hiking in the winter, no problems whatsoever.
If you buy a dumpy pair of boots that's not
going to last you more than one season.

Speaker 1 (37:09):
I think you have to look at things like, Okay,
am I going to make this investment one time and
it's going to last me X number of years? Or
am I going to buy the cheapest version of something
that's on sale and have to replace it every year
every winter, you know, twice a year, in which case
maybe making the investment actually makes a lot more sense.

Speaker 3 (37:26):
Yeah, there's between frugality and just making bad money decisions.
And it's a bad money decision to buy the cheapest
thing every single time, a winter coat, something that's going
to last you a long time as opposed to falling apart.
These are items that it makes sense to I wouldn't
even call it splurging. It makes sense to make the investment, Yeah,
to make the investment in something that you know is

(37:46):
going to last you a long a long time.

Speaker 2 (37:49):
You know. I came across something recently.

Speaker 1 (37:51):
It was a slideshow article about how to save money
in retirement.

Speaker 2 (37:55):
I thought, well, this will be interesting, right, this is
what we talk about a lot on our show.

Speaker 1 (37:58):
And I started looking at what they were suggesting in it,
and I thought, this is terrible. It was cut back
on traveling, cut back on eating out, cut back on
all of these things that you know, cut back on
your hobbies, kind of have no fun, Yes, have no
fun in retirement?

Speaker 3 (38:15):
Can you have no purpose?

Speaker 5 (38:17):
Yes?

Speaker 2 (38:17):
You can save money in retirement that way. Can you
enjoy it?

Speaker 4 (38:21):
I question that?

Speaker 2 (38:22):
And so I thought, well, this is terrible.

Speaker 1 (38:24):
I wouldn't want to suggest any of these things to anyone.
It wasn't saving on some kind of insurance product or
anything like that that could really make a difference.

Speaker 4 (38:31):
But I'm making this point to say.

Speaker 1 (38:35):
The balance has to be saving and investing the money
while actually enjoying your life and also consistently enjoying it
the kind of lifestyle that you have before retirement being
the same after retire.

Speaker 3 (38:46):
That's just an incredibly dark and depressing article and recommendation
that I would not suggest you follow. Financial planning is
about maintaining the lifestyle that you've grown used to and
making sure that you're able to maintain that to and
through retirement by making the appropriate savings decisions and planning

(39:07):
ahead accordingly, not completely skimming off of anything that you
find joy in life about.

Speaker 1 (39:13):
Here's the all Worth advice try and find the purpose
of every dollar you have.

Speaker 4 (39:17):
Thanks for listening.

Speaker 1 (39:18):
This is simply money presented by all Worth Financial here
in fifty five car see the talk station