Simply Money

Episode Transcript

Speaker 1 (00:06):
Tonight. We've got two major situations dominating the headlines right now.
How could they impact your money? Plus predictions about a recession,
and you are asking the advisor you're listening to simply
Money presented by all Worth Financial. I mean me Wagner
along with Steve Ruby. You know, we talk about market volatility,
and my goodness, Steve, when we've been talking about it
over the course of the past two three years, it's

(00:28):
all kind of been within the realm of what's the
Federal Reserve going to do to try to bring down inflation.
New economic data comes out and that's what impacts. But
sometimes what's happening is very geopolitical, and it could have
an impact on your money, I would say, in the
short term. And there are two major stories right now

(00:49):
that are playing out, one internationally, one here closer to home,
and both of them could impact your portfolio in the
short term.

Speaker 2 (00:58):
Yeah, you know, I was going to meet up just
yesterday and I pulled up a you know, a web page,
and there it was the Middle East. I ran fire
fire's ballistic missiles at Israel, And yeah, you know, that's
the first thing we're talking about here. Obviously, an escalation
of hostilities between these adversaries.

Speaker 3 (01:14):
Uh. You know, world powers at this point are.

Speaker 2 (01:17):
Certainly fearing that it could spiral into you know, a
Middle East wide war. You know, you said it yourself,
and it can be hard when emotions are high, and
this is fresh and right in our face right now
to realize that over the long term, investments are just fine.
But yes, something like this could certainly cause some short
term volatility.

Speaker 1 (01:36):
I think it'll be interesting really to see over the
course of the next few days really how this does
play out in the markets. You know, I was talking
to our producer Jason this morning. We were discussing the
fact that, you know, it's like when Russia invaded Ukraine,
there was new information for us to process, right, how
did that affect beyond just the humanitarian impact, which I
am not downplaying in any way, shape or form. It

(01:57):
is very real and it's incre tragic, but beyond that,
from a market and a global economic perspective, it was like, Oh,
all of a sudden, we're learning there's a lot of
grain that comes from the Ukraine area, and how's that
can impact things in an oil pipeline? How is that
going to impact things? My point in saying all of

(02:18):
this is that there was new information for us to
digest about the impact of a war in that region.
I'm not sure that there's new information to digest here
because this war has been going on for thousands of years, right,
there has always been unrest in the Middle East. In
not to downplay the sort of latest round of the

(02:39):
situation because I think it absolutely could get out of
control here, but from a purely market perspective, it's like
there's nothing new really to digest.

Speaker 3 (02:50):
Yeah, it's not exactly a surprise here.

Speaker 2 (02:52):
I mean Tuesday evening, you know, US intelligence warned that
an Iranian assault was in I mean this this was
somewhat known to the point where even before that that
additional troops were US troops that are were ordered to
the Middle East. Essentially it helped deter an Iranian tack

(03:13):
and to defend Israel. So this, this is as as
you said yourself, has been going on for a long time. Obviously,
we don't like to see stuff like this. You know,
Israel is now has boots on the ground and Lebanon
because Hesbola is you know, headquartered there and that's kind
of backed by by Iran. So you know, a lot
of moving parts here, but again not not particularly a

(03:34):
surprise that that something was going to escalate sooner rather
than later. And remember the markets don't like u surprises.

Speaker 1 (03:42):
Yeah, and if you're wondering exactly what triggered this situation, right,
just days ago, Israel killed kind of a Hasbola leader,
Hassan Israla, And once that was confirmed, Iran was just
poised because they're sort of the major patron of Hesbola Hasbola,
and so it was like, okay, now everything was kind

(04:02):
of ramping up. You've got us kind of in the
middle of this trying to talk down. Hey, Israel, we
don't need to respond in a major way. Hey, this
attack from Iran, while you know, it was severe, luckily
we knew it was coming, we anticipated it. It didn't
have necessarily a huge impact. They were able to divert
a lot of the fire that was coming toward them,

(04:24):
and so you know, it's just like this this is
playing out. But yeah, to your point, there's a lot
of focus on this. It'll just be interesting to see
what the impact of this. But listen, when you were
talking about pulling up something on the internet, Yeah, I'm like,
how many times have we done this. How many times
have we jumped online? And there's new headlines about, you know,
a conflict somewhere, the potential of a wars starting somewhere,

(04:47):
whatever geopolitical event it is, and it's like maybe a
blip in the market. And so if you're thinking, oh
my gosh, like this is new information, this is scary stuff.
What should I be doing with my four one k
What should I be doing with my investments? At this point,
not doing something is still a decision to do something right,

(05:08):
and I think that's a really powerful one right now,
is to focus on your long term financial plan. Right.
None of us can control what's going on in the
Middle East, but we can certainly control our response to it.

Speaker 2 (05:19):
Yeah, our own response or lack of response, which is
just as important. You know, from this oil prices of surged,
gold prices rose. You know, there was an article in MarketWatch.
Author is Adam Kobe. I'm not sure if I'm pronouncing
it quite right, but if you tried to say my
last name, he probably mess it up to Anyways, it's

(05:40):
spelled hrub y for those that are unaware. You know,
he broke down how stocks fared during during wars and
major attacks, and he looked at the period between the
attack on Pearl Harbor for example, and last year's start
of the Israel Hamas conflict, and he found that the
total average drawdown in the S and P five hundred
during these major events is is eight point two percent.

(06:01):
This is on average throughout history. But looking at it further,
what only really matters is if the economy is in
a recession or not. The average twelve month game when
the war breaks out outside of a recession nine point
two percent gain.

Speaker 1 (06:16):
Which the takeaway right is that the war when it
comes to the markets doesn't matter is much as whether
or not we're in a recession. And you know, we're
talking so much right now, a month away from a
presidential election, and there's lots of people who have really
strong opinions about who should be in office. You know,
we've looked at research that kind of mirrors this, that

(06:38):
shows a similar idea, which is, it doesn't matter who's
in the oval office from the markets perspective, it matters
how healthy the American economy is right now. You know,
So as we're looking at you know, does it matter
if there's a major geopolitical conflict, if there's a war
something along those lines. Really, to the market, what matters
most is the health of our economy.

Speaker 2 (07:00):
Yeah, and looking at you know, the broader range of
geopolitical events the stock market reactions from them. The market
bottom typically takes twenty two days of the recovery of
forty seven days. Now, this is typical. It doesn't mean
that it's what you need to go in and do.
Oh my god, this is happening. I'm going to sell
twenty two days.

Speaker 1 (07:16):
Market for twenty two days.

Speaker 2 (07:18):
No, do not try to time to market this as averages.
We don't know what's going to happen. Nobody has a
crystal ball. If I did, the crystal ball would probably
say just just don't do anything. Just write it out,
because that's going to be the best decision for the
longevity of your assets.

Speaker 1 (07:32):
You're listening to Simply Money presented by all Worth Financial.
I Meani Wagner along with Steve Ruby, as we're talking
about major stories playing out and the headlines in around
the world right now. Certainly tension in the Middle East,
the potential for a conflict there could create some short
term volatility in your portfolio. But listen, we would remind
you please don't do anything about it. Now. Where I

(07:53):
think you might see more of an impact at least
in the coming days, is there's stock workers right walked
off their jobs at dozens of ports. If you want
to look, it's all down the eastern seaboard into Texas.
And what I have seen is because of this strike,
the impact on the American economy could be up to
five billion dollars a day.

Speaker 3 (08:15):
Now.

Speaker 1 (08:15):
Major retailers are kind of already speaking out saying, hey,
we kind of saw this coming. We did what we
could to get items to where it needed to get
a little bit early, and so if we can get
this wrapped up in the next week, it may not
have long term implications. But who knows, right, who knows
how long this one can take?

Speaker 2 (08:33):
Yeah, I mean with the riding on the wall, companies
were able to prepare ahead of time to an extent,
you know, diverting some of their their shipments from the
East Coast to the West Coast for example, because you know,
this strikes its members in the International Longshoreman's Association represents
forty five thousand workers East Coast and golf.

Speaker 3 (08:48):
Course Golf Coast specifically.

Speaker 2 (08:52):
You know, they started their picketing Tuesday at cargo terminals.
They do currently handle more than half of American import
and export volumes.

Speaker 3 (09:00):
Yeah.

Speaker 2 (09:00):
What they're seeking the ISLA as a seventy seven percent
wage increase over six years.

Speaker 1 (09:05):
Yeah. So now they're hourly base rate is about thirty
nine dollars. They're looking for sixty nine dollars. Makes you
wonder how far apart these negotiations actually are at this point.
You know, talking about what retailers were able to do.
Some of them were able to reroute, you know, cargo
ships to the West coast. But then, gosh, you think
about during the pandemic, like what happened, and it was

(09:27):
that we could not get a lot of cargo, We
could not get a lot of items here. And as
the result of that kind of major supply chain disruption,
we had inflation. You now, it's like, Okay, we're on
the heels of that inflation, right, We're moving in the
right direction. We're not at that two percent goal of
the Federal Reserve, our nation central Bank, but we're certainly
moving in that direction. And this makes me a little

(09:49):
bit nervous about the fact that I was reading the
other day this is like everything from bananas to vehicles
to you know, everything kind of in between. We don't
necessarily think about the supply chain. We just think about
the fact that we order it from Amazon or we
go to the grocery store and it's there. But here's
the deal. If now companies are forced to fly things
in rather than ship them in, or if there's a

(10:12):
major you know, markup, and how much it's going to
cost to get these into the ports on the West Coast,
all of a sudden, the question, you know, becomes for
those companies, do we take these additional costs on the
chin or do we pass them on to the consumers?
And I don't know what do you think they're gonna be?
What you think they're gonna do? But I have a
pretty strong thought on this one.

Speaker 2 (10:31):
Yeah, I think so too. You know, the things that
you don't think about at all. A wholesale importer that
sells asparagus to Walmart and Kroger. You know, they discussed
with the Wall Street Journal what they're doing, and essentially
they're flying in vegetables that would usually arrive via boats
to the shipping yards and it adds about fifty cents
a pound to the price that the that they charge

(10:54):
to the store. So you know, you don't think about it.
You know, you're asparagus, who cares how gets there? But
it certainly affects us right now because that's just a
small example of.

Speaker 3 (11:04):
Yeah, the store isn't going to eat that fifty cents.

Speaker 2 (11:06):
They're going to pass that right on to the person
buying that asparagus or whatever. It might be, eggs machinery.
So this is something that Andy Stout did talk about
on Monday, concerns about potential supply chain issues leading to
some hiccups with inflation being reduced. But at the same time,
I think that companies have been preparing for this and

(11:28):
they with the writing on the wall, they had plans
to re route, which is certainly going.

Speaker 3 (11:34):
To be helpful.

Speaker 1 (11:35):
I think so, And mean, I think it would be interesting.
I mean, it depends on how long this takes right
to get a resolution. But you know, we're talking about
the impact I could have on your four one K,
but let's also talk about the impact I could have
on your grocery bills, or the fact that we're coming
up on holiday shopping season now. For you, Steve, you
don't do any shopping until December twenty fourth. Maybe it
will actually be resulting right then, But for the rest

(11:56):
of us that my shops start shopping before then, it
might be they're more difficult to get certain items or
more expensive to do.

Speaker 3 (12:03):
So just try my strategy.

Speaker 1 (12:05):
Just wait, wait until the very last minute. Not only
not only can you wait, you might also run into
celebrity appearance by Steve Ruby wherever he's shopping, because he'll
definitely be out there on December twenty fourth. Listen all
of this as we're discussing. It might make you wonder
are we heading toward a recession? It might give you
concerns about that. Well, a bunch of experts were just

(12:25):
pulled on this very question. We have what they're saying
coming up next. 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 Me Wagner along with Steve Ruby. If you
miss our show one night, you don't have to miss

(12:45):
the thing we're talking about. We have a daily podcast
for you. Just search Simply Money. It's on the iHeart
app or wherever you get your podcasts and straight ahead.
At six forty three, we are answering your questions. You've
got a lot of them about roth iras, long term
care insurance, and much more. This is our Ask the
Advisor segment. When it turned now to talking about everyone's

(13:07):
least favorite word, at least when it comes to your money,
your job, your paycheck, your floral one k. We're talking
about the R word recession, you know, and you know
during this time, this is when you start to worry
about your job. This is when you check your flooral
one k statement and you get a little nauseous all
of these things, and so we think, you know, there's

(13:28):
a reason why we don't like them. They're not fun,
they're painful, and so I think the question for a
lot of investors is always like, well, when's the next
one coming?

Speaker 2 (13:38):
Yeah, I mean it will happen, it's just not a
certainty of when it will happen.

Speaker 1 (13:42):
It's a natural one one is always coming cycle.

Speaker 2 (13:44):
Yeah, yeah, one is always coming. It's again, it's a
natural part of the business cycle here. And obviously there's
always speculation because people think it has a major impact
on the longevity of their money. But typically if you
have that investment strategy that makes sense based on your
financial situation, your needs, your goals, your time frames, than

(14:04):
we're fine at the end of the day. Now, recession
in twenty twenty five, obviously, that's questions that people are
going to be asking, and top econ economists that would
be the American Bankers Association predict that three there's a
three and ten chance currently that a recession in twenty
twenty five will occur.

Speaker 1 (14:23):
They asked this question twice a year, right, so we're
often getting their input and their thoughts and their opinions
on these things. I think the interesting thing is, you know,
for the longest time on the show, you and I
were talking about could the FED pull off a soft landing,
meaning could they bring inflation down without hiking interest rates

(14:44):
and hiking us all into a recession? And it's only
happened one or two times in our nation's history, right
going back over you know, one hundred years of looking
at this economic data, and so initially it seemed unlikely
and it was like, oh my goodness, it would have
to be a perfect storm of all the right you know,
factors coming together at just the right time, and it
appears maybe that's actually.

Speaker 3 (15:05):
Happened great, that's the question.

Speaker 2 (15:08):
I feel like every week that we interviewed Andy Stout,
I was like, so, Andy, are we going to have
that soft landing or what? Yeah, put them on the
spot over and over again, and the answer is maybe.
I mean, we just talked about the port strike and
economists see it as only a temporary disruption, probably not
anything that's going to have major long term effects. You know,

(15:28):
what could cause the recession in twenty twenty five, I
guess the housing market, the deep slump for high mortgage rates.
Manufacturing sector has been depressed for more than a year. Certainly,
there are some challenges on the horizon and some of
these sectors, but again to remind you, these are natural
parts of the economic cycle.

Speaker 1 (15:49):
Yeah, we're also seeing cracks in the labor market now right.
Businesses have kind of sharply reduced jobs, job openings, and
new hires. We kind of have seen unemployment rate tick
in the wrong direction, kind of go up a little bit.
We expected to see that actually a lot sooner than now,
when the Fed started hiking interest rates, and so now

(16:11):
we're starting to see it. There are going to be
all kinds of headlines, just as there have been headlines
over the past couple of years. I mean, I think
of one of them kind of coming into twenty twenty
four that was predicting the worst recession we've ever seen
in American history. I mean, all different. And you know,
it's like they'll grasp it little pieces of information when
they're writing these articles to make it sound like, oh,

(16:33):
maybe this is something I haven't considered, but this could
really happen. And I just want to remind you of
a couple of things. First of all, these people are
often wrong. You know, we're talking about three and ten
of these economists that we're surveyed saying maybe we'll see
a recession next year. They have been wrong many, many times.
They think these.

Speaker 3 (16:51):
Guys are smart, don't you tell me they're wrong.

Speaker 1 (16:53):
It's like the weather man. So I learned this in
my former life, right as a journalist. I was like, Oh,
I'm out here like every day kind of busting my butt,
trying to get the next big story. And here's the
weather person, and they're in the studio and they can
be right half the time. They can be wrong seventy
percently all over the place. They're still going to get
paid and starting to learn this about these economists, like

(17:15):
we still put them in the headlines. They still get
paid a lot of money. Yes, they have you know,
very impressive letters after their names, impressive degrees from Harvard
and Yale and all the things. Yet they're just opinions.
And I've been doing this for long enough to know
that I really don't put stock in the money of them.

Speaker 2 (17:33):
Sure, sure, yeah, I agree. Now, remember that the Fed
increasing interest rates like they did was purposely to slow
down the economy. You know, that's the game they play,
essentially to bring down inflation without pushing too far with
the unemployment rate. So you know, that's where Andy comes
in and maybe gives them a B plus at this point.

(17:55):
I think he said for a grade as to how
they've handled the pikes and learned from some of their
early mistakes to pivot to now reducing interest rates. You know,
a challenge that I think we see on the horizon
at this point would be consumer spending. It accounts for
two thirds of the US economy. Lower income families tend

(18:17):
to spend most of what they earn, and at this point,
there's you know, delinquency rates on credit card payments, auto loans,
other form of consumer debt has risen lately, so that
this is where some of the cracks in the foundation
of the economy. I think what we're seeing.

Speaker 1 (18:35):
One of the pieces of data that really actually had
me very concerned was the US savings rate. That's just
like the average amount that Americans are saving from the
money that you're bringing home in your paycheck. We saw
it rise to over thirty percent during the pandemic. Right
you were getting that stimulus money in, you had nowhere
to spend it. We knew that was not going to
stick around. But man, we have seen that savings rate

(18:57):
plummet since then. Have numbers in front of me, but
it was like two point seven percent that we saw. Well,
those numbers were recently revised up a couple of points. Okay,
that means to me, we have a little bit more
breathing room, consumers have a little more money left to spend.
So I think it'll be interesting to see how this

(19:18):
one in particular plays out. But I think back to
what we were originally talking about. There is a cycle.
It's a business cycle. It is a normal part of
being an investor. And you think about when you start,
when you graduate from college and you start working. Every
four to six years, you can expect us to cycle through,
meaning we're going to go through either a recession or

(19:38):
a ten percent pullback. It's important understand.

Speaker 2 (19:40):
That if you're nervous about recessions, to yourself a favor
and look at the history of market performance over the
past hundred years, and those huge recessions are just blips
on the scale of things because markets are always going
to come back to all time highs.

Speaker 1 (19:52):
Great perspective. Here's the all Worth advice. It's important to
remember that the market just goes through cycles. Stick with
your plan as a long term investor. Coming up next,
we're checking in on the local housing market for the
first time since the Federal Reserve lowered interest rates for
the first time in four years. 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

(20:19):
all Worth Financial and Ami Wagner along with sty Ruby.
For the first time since the Federal Reserve has lowered
interest rates, we have an update on the local housing market.
I would assume that we've had a lot of people
on the sidelines waiting for these rates to go down
that are now jumping in Michelle Sloane, of course from
Sloan Cell's Homes. You can hear her show here every

(20:42):
Sunday on fifty five KRC, and of course she's also
owner of Remax Time. Joining us tonight, Michelle, what are
we saying?

Speaker 4 (20:50):
Well, you know, you would think that people will be
jumping in with both feet, but we've only seen a
few buyers just dip their little toe into the water
of Because I think there is so much uncertainty in
the world, I'm just going to do my own little
prognostication today in the fact that, yeah, we're not seeing

(21:12):
a huge rush. The mortgage interest rate is right around
six percent, so six point to six point one something
like that, and obviously it's going to change depending on
your credit, your situation, but on average we're right around
six percent. That's awesome because we were at like seven
and seven and a quarter a year ago. And I

(21:34):
think that people are in a situation right now. Number one,
it's seasonal, and most people who've made a decision to
make a move have already decided where they're going to
be until twenty you know, spring of twenty twenty five. Yeah,
so I think there's a lot of people who maybe
were in the market to buy said, oh, rates are
coming down, let me wait and see. And I still

(21:57):
think there's a lot of wait and see going on.
The other thing is our inventory remains just a little lower,
and there aren't a lot of choices for buyers to
look at. Now. I have recommended to my buyers, let's
take a look, because if a home has been on
the market for thirty days or more, maybe that buyer

(22:21):
is a little bit anxious, motivated, a little motivated anxious,
and they're ready to make a deal. Let's make a deal.
There are some sellers that are really stuck in their
ways and they feel like, no way, I am not
lowering the price of my home. It's worth this much. Well,

(22:42):
your home is really only worth what a buyer's willing
to pay. And the market is such right now where yes,
we're still at an all time high in sales price.
Our sales prices are continuing to go up. But if
you've really priced home too high to begin with, it's

(23:03):
just not realistic. And buyers see that. And a lot
of buyers now who've either been looking for a while
or been watching from the sidelines. They're continuing to watch
and wait for that bottom to drop out. Now, do
I think that's happening.

Speaker 1 (23:21):
Probably not.

Speaker 4 (23:22):
But at the same time, there's a lot of buyers
out there that just aren't ready to make that move
right now.

Speaker 1 (23:29):
I think there's probably too like kind of a holdover
mindset from the pandemic, where it's like, wait a second,
we think rates are still going to go down to
three percent, right, so we're just going to wait for
them to continue to fall, which may never happen. And secondly,
you know, I think there's probably a lot of sellers
out there that are like, well, there was a bidding war,
you know, just a year ago that my neighbor across

(23:50):
the street had and they got twenty five thousand dollars
more than they were asking. That's what I should be
getting here. So I think maybe that's one thing that's
going on. But I want to ask you about something
else too. Was reading about something recently called the disjunction effect,
and a lot of Americans are kind of saying the
disjunction effect is hitting them in the fact that they're
not going to make any major purchases or moves, including

(24:12):
buying a house until after the presidential election. It just
feels like everything is kind of maybe a little unsettled now,
And I'm not sure why people are thinking it's all
going to be resolved after the first week of November,
but I wanted to get your take on that, like,
what's going on here?

Speaker 4 (24:28):
One hundred percent? There are more and more people who
they call me and say, Michelle, I want to know
what my house is worth, But I'm not doing anything
until spring. I'm not doing anything until we find out
who's going to be in the White House.

Speaker 1 (24:41):
You know.

Speaker 4 (24:42):
And honestly, if you're ready to make that move, I
always recommend don't wait because everybody's waiting and there's going
to be a lot more competition. So if you're in
the market to sell because you have a place to
move to, go ahead and make that move, go go
ahead and do it. But at the same time waiting

(25:03):
and a lot of people are waiting. I just I
feel like there will be a bit of a rush
in the spring. I hope, and I hope that people
realize it really doesn't matter. And I hate to say
that it doesn't matter who's in the White House. It
doesn't work. There's people are still going to need a home.
You're going to need a home to live in. And

(25:24):
unless you want to live in your parents or grandparents' basement,
you know.

Speaker 1 (25:29):
There's no thank you.

Speaker 4 (25:30):
Right, you get to a certain age where that's just
doesn't sound like fun.

Speaker 1 (25:35):
No, No, you know what, I think you make a
great point, right, It's just like, you know, we're waiting,
we're waiting, we're waiting. And if it makes sense, we
know that the American economy is bigger than whoever's in
the oval office. And I'm not sure if people are
thinking some kind of policy will change based on which
candidate is in office, it'll make it either better or

(25:57):
worse to move right now, But historically we just see
that the American economy, it's it's bigger than whoever's in
an oval office. And I think that's a really good thing,
regardless of figure candidate is.

Speaker 3 (26:07):
Oh.

Speaker 4 (26:07):
Absolutely, And I think that there are promises that are
being made potentially that buyers who wait are going to
get like a payout, They're going to get a lump
of money in order to buy a home. They're going
to you know, you're going to get five ten thousand
dollars to purchase a home. And help you with your
down payment. You know, I personally think that it's just

(26:31):
not the thing to wait for, because if you're going
to get this artificial amount of money, most likely you're
going to end up paying more anyway, and they're going
to be strings attached to that money where you have
to stay in a home. You're going to it's like
signing a contract and you're going to have to stay
in a home for a longer period of time. Then
maybe you even want to be in that home, So

(26:52):
you know, careful what you wished for is what I
always say. And if you can't afford to buy a
home today, if someone hands you money to buy a home,
are you still able to really afford that home? That's
the question I think you need to ask yourself.

Speaker 1 (27:05):
You make excellent points, and I think you know, there's
lots of promises made on both sides right on the
campaign trail, and then we see people get into office,
and really none of those promises even end up coming true.
But I think to your point, even if they were
to come true, you know, what would the actual impact
of those be. That remains to be seen, but maybe
not as much of a difference as a lot of
people think you know and you know, so what you're

(27:27):
kind of setting us up for here is what I'm
hearing is maybe a free for all in the spring,
like that the real estate market actually just opens up
and everyone jumps in. In which case, for those who
are thinking about jumping at that time, what's your advice.

Speaker 4 (27:44):
Well, again, you better be ready, yeah, because maybe there's
going to be, like I said, way more competition than
there is today, and you better be ready financially, you
better be ready emotionally, you better have your ducks in
a row, you better have your real estate agent online
on speed dial, and be ready to make a move quickly.

(28:05):
So planning now, if you are planning to wait, you
need to plan strategically, and I do think that means
talking to your real estate agent and your lender about
what you can do and what you're going to be
able to do and quickly.

Speaker 1 (28:19):
Michelle, what I also hear you saying is, if you
are thinking about jumping in, maybe take a look at
what's out there now, because there might be some deals
to be I mean, who knows what's going to happen
in the spring, but if if a property's been sitting
there for a while you might be able to take advantage.

Speaker 4 (28:33):
Of that absolutely, and if you've got a six percent
mortgage rate, go for it.

Speaker 1 (28:38):
Six percent, right, I mean I think two percent, three percent.

Speaker 4 (28:42):
Yeah, we're not going to get there.

Speaker 1 (28:43):
I don't think we're ever going to get there again.
At some point we're going to probably have to wrap
our heads around that. Great perspective, as always from our
real estate expert, Michelle Sloan from Sloan Sells, home owner
of Remax. Time, you're listening to some point money presented
by it all Worth Financial here in fifty five krs
the talk station you're listening to simply whenning some of

(29:07):
my own worth Financial. I mean, when you're along with
Steve Ruby, do you have a financial question keeping you
up at night? You and your spouse aren't on the
same page about We've got a red button you can
click them while you're listening to the show. It's right
there on the iHeart app. Will either help you sleep
better at night or we can help you settle that
argument with your spouse. Just record that question. It's coming
straight to us. Speaking of questions, we've got a lot

(29:28):
of them tonight. Let's get to them now. The first
one is from Lorraine, who lives in Greater Cincinnati. My
investments are diversified. Should I invest with multiple financial institutions
for added diversification.

Speaker 2 (29:40):
No, I'll come right out and say it no, there's
no point in doing that. People think that there might
be they feel more diversified by having assets spread out
all over the place, but it creates an issue in
how your investments are being handled. You can have disjointed
investment strategies, conflicting and investments. How are you monitoring the

(30:02):
investment allocation that you need to have, How are you rebalancing?
When are you rebalancing? From a logistical point of view
and proper investment management, it just quite frankly, doesn't make
much sense. There's also the estate planning aspect of it.
If something were to happen to you, then your errors
need to go to each one of these places and
deal with different people in different processes, and it's a

(30:25):
logistical nightmare, whether or not you're alive or debt. I'm
just you don't need to have your accounts spread out
to be diversified. You can do diversification in one or
two accounts.

Speaker 1 (30:34):
I've certainly come across people who feel very strongly in
the fact that seventeen different people need to be handling
their money in order for it to be truly diversified.
And a one hundred percent agree with you. I had
a college professor who kind of taught us the kiss theory, right,
keep it simple, stupid, and I think that applies here.
Life is so hard, There's so many things to keep

(30:55):
up with. Why are you keeping accounts in four different places?
That's not diversification. We talk about diversification. We're talking about
how your money is invested. Right. You want to be
exposed to different companies, different sectors, different segments of the economy,
as well as maybe different tax treatments. With the way
that money is invested, that's what we mean by diversified.

(31:17):
Not the fact that you have to deal with for
different financial advisors or accounts every time you're trying to
figure out where your investments are. That just makes it
unnecessarily complicated. All right, let's get to Diana. Actually's from chevit.

Speaker 3 (31:30):
How do I know if I need long term care insurance?

Speaker 2 (31:33):
Well, I mean, the unfortunate reality is that most folks
are going to need some kind of long term care insurance.
Knowing whether or not you need to purchase it is
a different story. So to elaborate this is, you know,
sitting down. One of the benefits of sitting down and
working with a fiduciary financial planner is mapping out that

(31:53):
financial plan to see if it makes sense for you
to actually self ensure. You know, that can be the solution.
Self and sure is a fancy way of saying, don't
waste your money on premiums for long term care, because
your plan has enough money at the end for you
to cover any long term care expenses that you might
need and leave money behind the loved ones.

Speaker 1 (32:13):
I think this is first of all, I love that
you're asking this question, because everyone should be asking this
question at some point, especially when you're getting closer to
retirement and this is becoming a reality. I think people
kind of fall into three buckets right. One is you
may never have enough assets, you know, and so in
which case, if something were to happen to you or
your spouse, you'll likely rely on medicaid, you know. And

(32:35):
then there's kind of that upper bucket where you're talking
about where you have saved well, you've planned well, you've
invested well. It doesn't make sense to necessarily spend money
on premiums because you can self ensure the people that
kind of fall in the middle right where you have
saved some assets but maybe not enough to cover what
is an incredibly expensive stay at a skilled care facility.

(32:57):
I think then it might make sense to look into
these premim names. But keep in mind, these premiums are
getting higher and higher every year is more and more
insurance companies get out of offering long term care insurance.
So I think you have to have this conversation. It's
worth it to work with a financial professional to have
this analysis done for you. But whether or not the

(33:18):
actual long term care policy makes sense, it kind of
depends on your individual situation. Let's get to Jordan next
and marrymtt.

Speaker 5 (33:25):
I recently read an argument that you shouldn't save in
a roth ira because your tax bracket in retirement will
be lower, So paying taxes now to get tax free
money later doesn't make sense.

Speaker 3 (33:37):
Do you agree?

Speaker 2 (33:39):
Not necessarily? It depends on the individual's finances today. I mean,
there's a lot of moving parts here, and it's a
great question and something you should be looking into. Certainly,
if you are knocking on the door to retirement, and
you are making a ton of money, maybe it wouldn't
make sense to do those ROTH contributions. Now, we could
always explore doing Roth conversions when you no longer making

(34:01):
the same type of money in a couple of years
and you're retired. But if you have a long time horizon,
then the argument could be made that you are exposing
your money to tax free gains which will offset the
potential higher taxes that you're paying.

Speaker 3 (34:16):
Now. I say potential because we are also in historically
low tax brackets right now. If I were to.

Speaker 2 (34:25):
Speculate a little bit, you know, maybe in the twenty
thirties time frame, Congress is going to have to come
together and do something about Social Security. Maybe that means
higher taxes for example. So you know, when we're thinking
about what to do with roth, Yeah, there's looking at
your current income and assumptions about future taxes. But when
you have a long time horizon, then the tax free

(34:46):
gains can oftentimes offset that difference.

Speaker 1 (34:49):
Yeah. I think this is another time when it just
makes sense to talk to a financial professional in your
CPA to see if it makes sense to you. But
certainly have that conversation coming up next. We've got a
dose of Wagner wisdom. You're listening to Simply Money presented
by all Worth Financial here on fifty five krs the
talk station. You're listening to Simply Money presented by all

(35:15):
Worth Financial. I mean me Wagner along with Steve Ruby.
That music means you're about to hear something earth shattering
and groundbreaking. We're calling this Wagner's wisdom. We're coming up
on the time of the year where it's open enrollment season.
I'm not talking about pumpkin spice lattes or I'm talking
about open enrollment season. And I think you know, for

(35:35):
a lot of you, I get it. Life is crazy busy,
It's incredibly hectic. This is not something you want to
revisit every year. But I would challenge you to understand
your benefits and to take a deeper dive into what's
being offered to you. And here's one of the reasons, Rywright.
I'm going to make my case for this. What we
have seen is a lot of research that shows that
your wages, your paycheck is not necessarily keeping up with inflation.

(36:00):
It kind of feels like you're making a little less
every year. Well maybe you are. And so the question
I have for you is do you fully know your
benefits and are you taking complete advantage of them? But
here's an example. I know a lot of companies who
have some kind of health and wellness incentive, you know,
And I was recently in a group of people where
someone was saying they were paying for their own gym membership,

(36:22):
and then they realize that the company would be paying
for it makes no sense right know what your benefits
are and how to take full advantage of them. We
talk about free money in the form of that company match,
but this is kind of another example of.

Speaker 2 (36:35):
That free money is low hanging fruit. Free money is
easy when it comes to your four oh one K
match because you just contribute, you get it. It does
sometimes take a little bit more effort to research and
understand what kind of other benefits you might have access
to through your employer, like that gym membership for example.
You know, another thing to review would be what kind

(36:57):
of health insurance are you? Yes, is this an up
opportunity to maybe explore a high deductible health plan that
would open the door up for a health savings account.
You know, in some situations that can make a ton
of sense for you and then you can use Amy's
favorite vehicle for long term savings for medical expenses, because
remember that's a triple tax advantage vehicle. But you only

(37:18):
have access if you have a high deductible health plan.
So certainly it's certainly worth visiting during open enrollment season.

Speaker 3 (37:25):
Yeah.

Speaker 1 (37:25):
I don't think this will surprise anyone, but my husband
recently started a new job and I was the nerd
that sat at the island at the kitchen last night
with a whole stack of paper like going through it,
and I couldn't wait right to look at the benefits.
And he came home and he was like, what are
you doing? But it's important for us to know this,
And I was like, did you know that they'll cover
our Amazon Prime subscription in a costco membership? So I'm like,

(37:49):
it's important to know what's offered. And yes, to your
point too, does a different health insurance plan that's offered
a health savings account. If a high deductible healthcare plan
makes sense to you, know, you opt into something like that,
You make that switch and the difference could be thousands
of dollars when it gets to your retirement. Know your benefits.
Please do not be lazy during open enrollment season. Thank

(38:11):
you for listening. Tune in tomorrow we're talking about the
best ways to protect your wealth. You've been listening to
Simply Money, presented by all Worth Financial. Here in fifty
five KRC, the talk station