November 11, 2025 • 42 mins
On this episode of Simply Money presented by Allworth Financial, Bob and Brian talk with Allworth Chief Investment Officer Andy Stout about what reopening the government would mean for data flow, how rising household debt is sending mixed signals, and why cracks are showing in the labor market. Plus, why smaller companies are shedding jobs while big corporations are hiring, and how AI might be playing a surprising role.
See omnystudio.com/listener for privacy information.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Your number one tree set on the iHeartRadio app.
Speaker 2 (00:03):
It makes it easy to stay connected because I just.
Speaker 3 (00:05):
Put on the app.
Speaker 1 (00:06):
Fifty five KARC the talk station.
Speaker 4 (00:14):
Tonight Marcus react to government shutdown news, How to react
to a possible change to your four to one k
and we answer your questions. You're listening to Simply Money
presented by Alworth Financial. I'm Bob Sponseller along with Brian James.
Speaker 2 (00:28):
Well.
Speaker 4 (00:29):
It appears that the government could be back open for
business later this week. It sounds like it at this point.
Joining us right now is all Worth Chief Investment Officer
Andy Stout to provide the economic implications of this news.
It's been a pretty active news flow over the weekend. Andy,
bring us up to speed here on the status of
the government shutdown.
Speaker 3 (00:51):
Well, I'm sure most of us probably saw the news
last night where the Senate has basically agreed to a
solution to move things forward. They got some Democrat senators
on board with the Republicans and you get to the
necessary votes. Now moving on to the next step where
essentially going to the House for approval.
Speaker 5 (01:12):
That'll probably happen sometime this week.
Speaker 3 (01:15):
The timing is still a bit unclear as to when
that will happen, but after the House likely approves, then
it will go to the President to sign. Now, what
that means in all likelihood is that the government probably
reopened sometime around the middle of the week. And from
my perspective obviously, well, first of all, obviously that's good
news for those people.
Speaker 5 (01:36):
Who are for a load and have missed the paychecks.
Speaker 3 (01:38):
From an economic standpoint, when looking at the data that
we've been missing, we have now finally a bit of
clarity on the horizon. Now probably won't see anything this
week in terms of economic data being released because I remember,
the government has to recall all the staff and then
they got to start to put all the data, collect
the data, put all the data together, and then we
can start to see some information line CPI, GDP retail sales,
(02:03):
But don't expect anything this week.
Speaker 5 (02:05):
Most likely it'll be a data.
Speaker 3 (02:09):
The floodgates are going to open really over the next
couple of weeks in regards to data, and that's going
to be very beneficial for the Federal Reserve as they,
you know, try to figure out whether or not the
economy is chugging along or is finding a bit more
crafts When they start to look at the actual data.
You know, some of that cracks we've been seeing are
(02:29):
on the labor side, and so getting some official data
is going to be beneficial.
Speaker 6 (02:35):
So Andy, this doesn't actually, if I'm not mistaken, we're
kicking the can a little bit here, right, I mean,
this is gonna This does not resolve the issue that
the Democrats want, which is the the the extension of
the subsidies for the Obamacare premiums. But we're basically committing
to have a vote on that at some point in
the future. Is that is that part of this is
(02:56):
I'm not mistaken, We're going to be having this conversation
again in the next over the next six weeks, right.
Speaker 5 (03:01):
Yeah, that is definitely part of that.
Speaker 3 (03:03):
And then also this is a continuation for the government
to reopen. Is really just through the end of January.
So market on your calendars now for maybe some additional
well I don't know if i'll say volatility, but definitely
some tension when it comes to the political framework.
Speaker 4 (03:22):
All right, Andy, let's get into some data that we
actually do have, and I want to talk about household debt.
It looks like household debt climb to a record eighteen
point six trillion dollars in the third quarter. That's about
a three point six percent increase from a year ago.
Speaker 2 (03:36):
Even though that's at.
Speaker 4 (03:37):
A new new high, the pace is roughly in line
with three point seven percent wage growth over the last year.
So the data on the surface of it suggests that
consumers are not over extending themselves at a high level
at this point. But with the student loans having to
be repaid now after the repayment pause you know under
(04:00):
the last administration, that's where at least it appears that
we're seeing some cracks here because we're seeing some delinquencies
on these student loan payments.
Speaker 2 (04:10):
It just sounds like the.
Speaker 4 (04:11):
Lower end, you know, entry level consumers in this economy
that are saddled with student loan debt and everything else
trying to get started. Those are the people that are
really struggling right now, and that might explain some of
the election results in New York City last week.
Speaker 3 (04:29):
Yeah, when you look at just the overall big picture
in terms of the consumer and the consumer's health, I mean,
really spending has been keeping the economy going. Consumer spending
represents about sunny percent of the economy. But when you
look at some of the data that we've got very recently,
and I say data we've got, it might seem kind
of weird. However, that's because we haven't been getting hardly
(04:51):
any data. But we've been getting data from some other
sources like private parties, private companies, but also from the
Federal Reserve, because the Federal Reserve is not affected by
the shutdown, and the Federal Wazer posts this consumer data. Yeah,
what it did show was that when you look at
the household debt hit another record eighteen point six trillion
for the third quarter. Now the first thing people think, oh, no,
(05:12):
another household debt record level. Keep in mind, these are
in what's what we call nominal terms, so they're not
adjusted for inflation. Now, when we look at inflation that's
out there, we look at wage growth, we look at
just general prices. Basically, this three point six percent growth
is pretty much in line with what wage growth has been.
So it's not as if consumers are really going too
(05:33):
far out over their skis compared to where they were
at least last quarter. So it's not really a macro
threat when you look at the total data. However, when
we look at certain subsectors of the data of the
debt levels, like student loans, that's a bit concerning credit cards.
Speaker 5 (05:49):
That's also a bit concerning.
Speaker 3 (05:51):
So like on credit card debt, you know, that jumped
almost six percent, so definitely more than wage growth, definitely
more than just general inflation. And also the delinquency and
I'll look at the serious delinquency rate, so that's credit
card balance is more than ninety days past due. You know,
those are right around seven percent, and that's pretty much
where they were, but it's still a relatively high level,
(06:12):
especially compared to just a bigger history. Normally that credit
card debt, you know, might be closer to some lower
levels when you look at it, it's usually around i'll
call it five percent in that general area going back
to about two thousand and three. So credit card debt
is a concern. Student loan debt that's another really big
(06:34):
concern because if you remember, you know a lot of
the student loan payments have been basically deferred for a
while because of COVID. Now that it opened back up,
we saw serious delinquencies jump from basically under one percent
last year to over fourteen percent. So these are something
that we This is an area one I'll watch really
(06:55):
close to because that's a stressor that some people are seeing.
So now government reopening and that's going to be definitely
something that can help us move forward.
Speaker 6 (07:04):
And it seems that the consumer has noticed too, because
the University of Michigan had their Consumer Sentiment Index come
out and that dropped to a little over fifty in November,
and that's the weakest level we've seen in a couple
of years. So it would seem that this isn't happening.
You know, behind the scenes, people are well aware of it,
and their concerns were shared about not only their own
personal finances but business conditions in general. And actually most
(07:25):
households expect unemployment to go up over the next year,
so they're not seeing happy things on the horizon. Do
you agree with with what the herd is saying there
or do you think there's a different outcome.
Speaker 3 (07:34):
No, I absolutely agree with what they're feeling when they
were asked. And you got to remember, whenever someone has
asked something about how they feel, kind depends on what's
going on in the environment, and that environment has been
overshadowed by the government shutdown.
Speaker 5 (07:48):
That's definitely affected.
Speaker 3 (07:49):
So what's going to be really interesting to see what
sort of rebound we may see in the next Consumer
Center report when we get that with the government reopening
and hopefully stay saying open been for a while. But yeah,
when you look at some of that data, Brian, essentially,
the data we've gotten last week, it's been you know,
a little bit kind of a little bit hairy.
Speaker 5 (08:09):
I mean, we saw the that's the layoff notice.
Speaker 3 (08:14):
It's reported by Challenger, the Challenger layoff notices that jumped
to one hundred and fifty three thousand. That was the
highest October announcements in terms of layoffs in more than
twenty years. So you know that that was a big number. Now,
not all the data that we've gotten, excuse me, from
private companies has been bad. You know, last week we
(08:35):
got ADP Data, which is a big payroll company, and
they showed that total private payrolls increased by forty two thousand.
So that was pretty good, especially considering that we've had
two months of decline. But when you look under the
hood a little bit, what we see is that large
companies were really the reason for this. Large companies essentially
added seventy four thousand and in large companies basically five
(08:57):
hundred plus employees, but companies under that actually cut thirty
two thousand jobs last month, So when you look at that,
it's not as pretty as it looks a little bit
of a mixed picture when it comes to labor reports
that we've been getting last week, But overall, it is
something that I would call definitely some cracks are forming,
and we need to see how those cracks are continued
(09:18):
to progress as we get more and more data, because
that's going.
Speaker 5 (09:21):
To have a big impact on what the FED does.
Speaker 4 (09:23):
Andy, I want to get your take on maybe what's
going on here with that latest ADP report. It seems
a bit counterintuitive to me when everyone's talking about the
potential of AI really disrupting the labor market causing jobs
to go away for a lot of people. I would
have expected these huge, large companies that are already implementing
(09:43):
a bunch of AI technology to be the ones laying
off people, when you know, at least for the October report,
it's the businesses with fewer than five hundred employees that
cut the jobs.
Speaker 2 (09:54):
What are what do you see as.
Speaker 4 (09:56):
The reasons behind smaller employers cutting while larger employers actually
adding jobs.
Speaker 3 (10:04):
Yeah, well, that's a very interesting take, and I think
what you really also need to look at is you
need to look at the sector levels within those ADB reports.
So one thing you can look at is that a
lot of the gains were concentrated in what i'll called
trade and utility companies.
Speaker 5 (10:21):
I was about forty seven thousand of that.
Speaker 3 (10:23):
Financial service companies added another eleven thousand, and education healthcare
was also a big benefit benefactor, I guess I should
say or whatever, adding twenty five thousand.
Speaker 5 (10:34):
Now we saw declines in some of these.
Speaker 3 (10:35):
Other areas like it, which actually to your point regarding AI,
they dropped the total number of jobs by seventeen thousand.
So at the sector level, AI is having impact, especially
on those information companies. But to your point, also larger
companies are taking advantage of AI and they're probably a
little bit more able to essentially implement a lot of
(10:58):
these AI projects that would you know, allow them to
reduce their workforce. But what a lot of them are
doing it's more of a they're not hiring and they're
just not firing either. It's like a no hiring, no
firing for these larger companies on the whole. So they're
looking to use AI to get more out of their
current workers, but still not higher additional companies now are
(11:20):
additional employees now. The other thing I want to mention,
just really quickly on the jobs front, the Chicago Fed
release their.
Speaker 5 (11:27):
Unemployment rate proxy.
Speaker 3 (11:30):
It's kind of nice because it gives you a good
idea of what's going on without actually getting.
Speaker 5 (11:33):
The data from the government.
Speaker 3 (11:35):
And what they showed is that the unemployment rate likely
moved up just a hair from four point three to
four point four percent, so still pretty low from an
overall perspective.
Speaker 6 (11:45):
Any and maybe you address this, and I hope it
didn't miss it, apologies if I did. But do the
numbers whether we're talking about Challenger or assume not ADP
because ADP doesn't do the federal payroll. But do those
include the federal furloughs we've been talking about the last
couple of months, or are we setting that aside?
Speaker 3 (12:00):
Well on the Challenger stuff, it certainly does not, because
it's really just about whether or not companies are announcing,
and so it's going to be your private companies and
ADP the furloughed workers, those are all going to be national.
So when we talked about that forty two thousand new
jobs in seventy four thousand other or yeah, coming from
(12:21):
the larger companies.
Speaker 5 (12:23):
You know, those are not going to impact for load workers.
Speaker 3 (12:25):
However, what it does impact is the essentially the companies
that were impacted in like local company, local economy areas
by the furlough furlowing.
Speaker 6 (12:35):
The federal government's doing less, so the companies that support
them are in turn doing less. So it's not a
direct account of people who have been furloughed, except for
businesses who serve those people have laid off their ow employees.
Speaker 5 (12:46):
You said that much better than I was about to,
So thank you.
Speaker 2 (12:48):
I do what I can.
Speaker 4 (12:49):
All Right, guys, we're gonna have to leave it there
for tonight. Thank you for joining us. As always.
Speaker 2 (12:54):
Andy.
Speaker 4 (12:55):
Coming up next, a giant in the retirement plan world
is shaking things up. Well you what that could mean
for your four one K, your asset allocation, and your
long term income plan. You're listening to Simply Money, presented
by all Worth Financial on fifty five KRC.
Speaker 2 (13:10):
The talk station.
Speaker 1 (13:13):
Story coming out of City Hall today.
Speaker 2 (13:15):
Us when you need it.
Speaker 1 (13:17):
He said that what I was hearing locally, nationally, everywhere
in between fifty five krc D talkstation.
Speaker 7 (13:26):
All Worth Financial a registered investment advisory firm. Any ideas
presented during this program are not intended to provide specific
financial advice. You should consult your own financial advisor, tax consultant,
or estate planning attorney to conduct your own due diligence.
Speaker 4 (13:46):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponsoring along with Brian James. If you can't
listen to Simply Money live every night, subscribe and get
our daily podcast. You can listen the following morning during
your commute, or during your workout at the gym, or
in your during your evening walk around the neighborhood. Think
about how fun that might be. And if you think
(14:07):
your friends and family could use some financial advice, tell
them about us as well. Just search Simply Money on
the iHeart app or wherever you find your podcast. If
you've built a couple million dollar portfolio, balance in retirement accounts,
and if you have a paid off home and are
sitting on cash wondering what to do next, You're not alone.
(14:28):
We're going to answer questions about all of that and
more straight ahead of six forty three be honest. How
often do you check your portfolio balance? A new study
done by a research firm called dy Neta found that
almost half of all investors are checking their investments performance
(14:48):
once a day or more.
Speaker 6 (14:50):
Brian, I'll admit it. I do this way more often
than I should. I'm human too. It's fun, right. I
know it's going to panic. When it's negative, I just
quit looking at it. But when it's when things are
going up and the net worth is reaching heights it
hasn't before, I know full well, I'm going to give
a chunk back.
Speaker 2 (15:06):
That's how life works. And I checked the.
Speaker 4 (15:09):
I check the balance of my doge coins about every
fifteen to seventeen minutes.
Speaker 2 (15:13):
It's a it's a wonderful dopamine rush.
Speaker 6 (15:15):
You own no doge coins, don't, don't.
Speaker 2 (15:18):
I know you better than that.
Speaker 6 (15:20):
You wouldn't know where to buy doge coins. I'm teaching,
But yeah, no, I do it too, you know, And
this survey tells us, you know what, why are people
doing this?
Speaker 2 (15:27):
Well? I can tell you exactly why I do it well.
Speaker 6 (15:29):
When markets are volatile, people look more often because we're
thinking about it, right that it's in the headlines, it's
in my face. In between my meetings, I catch a
headline on my phone and maybe something good is happening,
maybe something bad's happening. Well, I can't resist. I got
to go see what's happening in my own portfolio. Gives
us the illusion of control, right, we believe that. You know,
sometimes we think if we're always looking at it, we're
going to be able to react quickly or prevent losses,
(15:51):
or maybe jump into something before it makes the big run.
Speaker 2 (15:53):
This is why there's a whole.
Speaker 6 (15:56):
Part of the academic world called behavioral economics, and they,
the economists there, call this the control fallacy. Staring at
it doesn't improve outcomes. It just amplifies stress. Right, If
we watch that pot of water boil, it is not
going to make it boil any faster. Matter of fact,
our brains are going to think that it's not boiling
fast enough.
Speaker 2 (16:15):
Well, but we can, again, we can feel like we're
at least controlling its watching it. We all know that's
not the case, but it's just how our brains get wired.
And I think that leads to this next point. We
let's face it, we all live in a what we'd
like to call a refresh economy. Right now. What does
that mean?
Speaker 4 (16:33):
Well, people check their likes on social media, they check emails,
they check news in real time, and let's face it,
investor behavior has followed suit.
Speaker 2 (16:43):
We're all used.
Speaker 4 (16:44):
To staring at these apps and just constantly looking at screens,
and it tends to move over to the investment world too.
Speaker 2 (16:52):
It's just natural behavior. We just like to see things
moving around. We like to see colors change, we like
to see like we like to see news updates.
Speaker 4 (17:02):
And people know that's the case. We've talked about that
humptying different times. That's how the whole media and social
media business platform has been built to glue us to
that screen and keep us looking at everything all the time.
We just got to be mufthful of that because sometimes
if you look at your investment, you know, balance, too
(17:24):
often you're going to be driven to make a decision,
right because you know, it goes back to that control thing.
I see it moving around, I must do something, and
usually nine times out of ten, that's something that we
do ends up not being a good decision.
Speaker 6 (17:39):
Yeah, and I've been fascinated by this, you know, I've
been doing this for thirty years and the things that
get people's attention, including myself. I'm human too, and I
have the same goal as my clients do. I want
to retire someday and get the kids through college and
all that other stuff. But that's been fascinating to me
to understand why that occurs. And at the end of
the day, Bob, we are all between our ears. We
(17:59):
have lunch meat and chemicals. One of our favorite chemicals
in there is dopamine, and we get dopamine no matter what.
It gives us that little emotional hit, even positive or
negative news, just something, some kind of new stimulus gives
us a little shout of dopamine, and it turns out
that's what we're after. That's why we pick up our
phones a thousand times a day, just to see whatever
baloney headlines or whatever meaningless notifications are there for me
(18:20):
to react to. And then there's I can't really remember
the last time I picked up my phone, looked at
it and realized, yes, there, I should do something about
this news headline. This should cause me to act in
some way. No, it's just me getting my little dopamine
hit and then going back to work or whatever I
was doing before until I get the urge to do
it again. So I've been really trying to be more
mindful of that. How how rarely it actually means anything.
(18:42):
So anyway, So that's the dopamine side of things. There's
also fear of missing out or what I like to
call fomo. When news breaks about, hey, the market's hitting
a record high, AI stocks are swaring well, well, that
causes us to feel like we're gonna miss something. I
better be watching, or I'm going to miss out on
an opportunity to be a to be a bazillionaire tomorrow. Really, really,
this is super common among younger investors and people who
(19:02):
started investing really just in the past three years, which
have been really really positive ever since twenty twenty two,
and so looking every day has been a rewarding experience.
If you just started looking, just started investing in the
last three years, you start studying your market history because
it's not always going to be this way. You will
there will be a time where there's twelve eighteen months
(19:23):
you just do only want to look at your four
one k. It's just too darn depressing. However, that's part
of the game. You have got to get used to that.
If you have young people in your lives who have
just started their four one ks, just started investing. Teach
them market history, show them what twenty twenty two looked
like two thousand and eight oh two. These are things
that will happen, are virtually guaranteed to occur again. We
have to be able to anticipate them and make sure
(19:44):
we can ride them out. Otherwise we start making bad
decisions like trying to time the market, which usually means
getting out at the bottom, or trying to make it
up with super speculative assets, which can exacerbate things. And
all of that robs you of years of building wealth
for sure.
Speaker 4 (19:58):
And I think another another reason people just get addicted
to checking all this stuff. You know you talked about
fear of missing out. There's another thing out there, and
it's just straight, you know, fear in general, past market trauma.
People who live through the dot com bust, the Great
Financial Crisis or COVID remember how fast things can change.
(20:20):
And let's face it, in today's political divide, where I mean,
depending on where you get your news sources, and I'm
talking to people on both sides of the aisle here,
you know, for you know, an app like X for example,
Brian I'd say sixty to seventy percent of the stuff
that flies around on there, it's unverified. You don't know
(20:40):
whether that's real news, fake news, or anything in between,
or just straight out lies and propaganda.
Speaker 2 (20:46):
But if we get that fear thing, we're.
Speaker 4 (20:49):
Just waiting for the next shoe to drop, the next
thing to implode our portfolios. And a lot of people
are walking around with that all day every day. When
that causes people to check their portfolios more than they
should and again make decisions that they.
Speaker 6 (21:05):
Probably shouldn't make and sorry, and then life changes too, Right,
So big life events retirement, job change, marriage, divorce, inheritance,
new baby in the house, new grand baby around, that's
a great time to kind of look at things as
a trigger. So the investments might still be fine, but
something changed in the outside of your big picture shifted
a little bit, so maybe your mix needs adjusting. But
(21:26):
if those big things aren't happening, let your portfolio alone.
If it was fine before, it's still fine, just look
at it when there's new information to react to. Also,
of course, in this I think goes without saying, when
you're near a milestone, if you're sneaking up on retirement,
or you've got a big purchase to make, maybe paying
off college something like that. That's a time to review
where's the risk in my portfolio. So I've got this
(21:47):
big expense coming up, Am I using dollars that could
go over the cliff tomorrow just before I have to
pay the bill? If that's the case, then I might
be making mistakes. So maybe I need to take some
risk off the table rather than waiting until it's literally
time to write the check to whomever is going to
take that money from you. So the closer I am
to using that money, the more important it is to
shift from growth to preservation. Take the gains while they're there.
(22:08):
And we've talked about this ad nauseum all year long.
I think, Bob, this has been a great run, great
couple of years. If you've got an upcoming bill in
the next couple months, maybe even the next year, you
might take those dollars off the table. So it's not
hard to write that check. Should the market take a dip, Yeah, I.
Speaker 4 (22:23):
Mean you've been getting into reasons why you should check
your portfolio and responsibly review your strategy.
Speaker 2 (22:29):
And I'll say this.
Speaker 4 (22:30):
Gets into whether you're a self directed investor or whether
you work with a good fiduciary advisor.
Speaker 2 (22:37):
Here's the all Worth advice. If you've got a good.
Speaker 4 (22:39):
Financial plan the portfolio, remember that it's just the engine.
You don't need to look under the hood every day
to know that the engine is running. Coming up next,
how old is your Internet router? That's a question you
should probably answer very soon, and we'll explain why you're
listening to Simply Money, presented by Allworth Financial on fifty
(23:00):
five KRC the talk station.
Speaker 2 (23:04):
Something is happening.
Speaker 1 (23:05):
It's time to end the failed experiment of open borders.
Speaker 7 (23:08):
Your countries are going to hell.
Speaker 2 (23:10):
Something in our country, Charlie Kirk, I forgive.
Speaker 6 (23:13):
Them Antifa across this country would be.
Speaker 8 (23:15):
Trump assess and Ryan Ruth guilty on all five charges.
Speaker 4 (23:18):
Something in our world, Jato countries should shoot down Russian
ear crash shank you in all day they.
Speaker 7 (23:24):
Enter their ear.
Speaker 2 (23:24):
See it's always something.
Speaker 9 (23:26):
Yes, I do.
Speaker 1 (23:27):
It's a very important moment. Fifty five KRC the talk station,
and I'm Marto.
Speaker 7 (23:32):
Lopez here and right now iHeartRadio station.
Speaker 2 (23:39):
You're listening to Simply Money paused by all Worth Financial.
Speaker 4 (23:42):
I'm Bob Sponseller along with Brian James, joined tonight by
our real estate expert Michelle Sloan. Michelle, thank you, as
always for spending time with us tonight. We're gonna call
this segment fixer upper regret.
Speaker 2 (23:55):
Give us some advice.
Speaker 4 (23:56):
On what not to do in terms of piling money
into a house that we potentially might want to sell someday.
And you know, how much is too much and what
area is the wrong area to quote unquote invest in
when putting money into a home that we might want
to reap that investment back later.
Speaker 8 (24:16):
Well, that is a loaded question.
Speaker 2 (24:18):
I don't know.
Speaker 8 (24:19):
I think there is a movie out there called The
Money Pit. Yeah, and sometimes.
Speaker 2 (24:25):
I've lived in one of those before.
Speaker 8 (24:26):
You have to be really, really careful because you have
to know what you're doing. You can't just go into
this real estate thing blindly. And do you are you
planning to buy a fixer upper to live in? Are
you planning to buy it as an investment? Do you
have the wherewithal and the knowledge even to get into
(24:49):
something like this because it is definitely not for the
week or someone who doesn't.
Speaker 2 (24:54):
Have deep pockets.
Speaker 8 (24:56):
So I've seen quite a few properties over the years
I've been in business in real estate, selling real estate
for twenty years, so I've seen some people that have
gotten themselves in over their head. And if that's the case, again,
you just have to know when to say when. But
you really need to set a realistic budget. And if
(25:18):
you're buying a home as a fixer upper knowing that
it's going to need work, do not Here's my number
one tip. Do not skip the inspection because that's going
to tell you if it's more cosmetic items that need
to be updated, or if it's something that's going to
cost a lot more money and it's not as sexy,
(25:40):
if the wiring needs to be changed, Sure, you know
something like that.
Speaker 6 (25:45):
But do people have that option nowadays? I mean, with
houses going as fast as they have and I realize
things are slowing, but is something that is a true
fixer upper? Does that hang out on the market a
little longer because it spooks enough buyers away. Because I
feel like a lot of other most of my clients
are telling me I don't have the too, I can't
do an inspection because somebody's gonna throw cash at this
and not want an inspection. So if I really want it,
(26:06):
I got to forego.
Speaker 2 (26:07):
That is that an option.
Speaker 8 (26:08):
The market is changing, and you can get an inspection out.
And here's the thing, it doesn't matter what's happening in
the market financially. You have to be smart. You guys
say this all the time, you know, just because you
get emotionally attached to a property. And I've showed so
many properties to buyers where they're like, oh my gosh,
(26:29):
look at this view. And then I say, but look
at the foundation. It's crumbling and this house is going
to fall off the side of the world any minute.
Speaker 4 (26:39):
Now.
Speaker 8 (26:40):
It doesn't matter how much it costs to buy it.
But again, you have to know what is it going
to cost to fix it up and make it safe
and make it stable. And again, if you don't know
what you're doing, and a lot of times it is
really important to have someone with some experience as far
as your realtor who's going to tell you the truth
(27:01):
whether you want to hear it or not. I remember
that specific buyer. It was a house in Mount Adams.
It was looking over it at the city. It was gorgeous,
but the place was crumbling and it was about to
fall off the side of Mount Adams. And so I said,
you know what, you don't have the funds because when
you're setting a budget, you've got the purchase price. But
(27:24):
then most people underestimate the cost that it is to
actually fix it up. You can't just foundation issues. You're
not You're not just putting you know, filler in some cracks.
Speaker 2 (27:38):
So you have.
Speaker 6 (27:41):
No no, no, it's.
Speaker 8 (27:42):
It can be very very costly if you jump into
something and only look at it with your heart and
not your mind.
Speaker 2 (27:51):
Hey, Michelle, speaking of investing with your heart not your mind.
Speaker 4 (27:55):
You know, take me through if this has ever happened,
you know, with with your customers.
Speaker 2 (27:59):
I mean, people go in with the best of intentions.
Speaker 4 (28:01):
They buy a house and they think they're going to
live there forever, and they want it to be perfect,
so they just start fixing it up.
Speaker 2 (28:08):
They want it to be, you know, perfect for them,
And I.
Speaker 4 (28:11):
Think sometimes people will invest money in the house to
the point where now they have the most expensive house
on the street, or you know, the most expensive three
bedroom compared to other three bedroom houses in the street
or the subdivision. Don't you have to kind of, you know,
in spite of your heart and how nice you want
things to be, don't you always have to kind of gauge,
(28:33):
you know, how much do we have into this house
versus what it could potentially sell for. Because people think
they might live in this place forever and then somebody's
job gets transferred or they just have a change of
heart and mind and want to move.
Speaker 2 (28:46):
I mean, don't.
Speaker 4 (28:47):
Don't you have to kind of you know, price this
stuff out on what the market will bear, so to speak.
Speaker 8 (28:52):
Absolutely, you really need to avoid over improving a home.
So for example, if you're gonnall a one hundred thousand
dollars new kitchen in a three hundred thousand dollars home,
your balance is off and you're not going to get
that money back, no matter how nice it is, You're
(29:13):
not going to get your money back if you decide
that you need to sell now. If money is no object,
have at it. But again, like I said, if it's
if it is a moderate cost based on the neighborhood
and the other homes around you, then that's a good
it's a good investment. If you are going just hog
(29:35):
wild because you won the lottery, okay, that's fine. You're
going to spend through all that lottery money and you're
gonna at some point need to sell that house. And
you've over improved it so much that there's no way
an appraisal is going to be able to come in
on and get you that money back. So you really
have to be prepared and ask all of the right questions. No,
(29:59):
have a have someone to talk to. Have your real
estate agent or a friend or a financial advisor talk
to them about the smart ways to invest in a property.
Maybe it's a fixer upper, maybe it's your own home.
You know, Scott and I have We have fixed up
(30:19):
every home that we've ever lived in, and we've done
a lot of the work ourselves, so we've saved quite
a bit of money. But it's interesting because when you
go to fix up the floor in the kitchen, then
it doesn't match the floor in the living room or
the family room, so then you got to do that,
and then you're going into a bathroom. I mean, it
just seems like it's snowballs. So one thing will lead
(30:41):
to another and lead to another, and before you know it,
you are spending a lot of money and a lot
of time and a lot of disruption.
Speaker 6 (30:50):
So you have to think about all of those things.
So let me ask a question from the other point
of view. Does this mean that I can go get,
you know, sixteenth of an inch thick cheap crappl from
the clearance thing and throw that down so that it
looks pretty for I mean that I'm being a little
facetious here, but obviously there's a good thing to do
and a bad thing to do. So what's the minimum
you should do if you need to.
Speaker 8 (31:10):
Sure, I mean, if you want to, if you want
to do quality that's going to last, especially if you're
going to be living in the home.
Speaker 3 (31:17):
Now.
Speaker 8 (31:18):
I've seen a lot of people that are flippers and
they've put the lower grade items, the lower grade flooring
in the homes. It looks good, but the quality's not there.
So it really depends on asking yourself, what is your why?
Are you renovating for yourself, your comfort and your longevity?
(31:39):
Are you renovating so that you could flip it, turn
it around and sell it? And those are completely different things.
You got to ask all of the questions before you
get started.
Speaker 2 (31:48):
Great advice, Michelle, Like a lot of things in life,
know your why. I love that advice you're listening to.
Speaker 4 (31:54):
Simply Money, presented by all Worth Financial Law on fifty
five KRC the talk station.
Speaker 1 (32:01):
Mark Levin.
Speaker 10 (32:02):
Probably the people who should be listening aren't, But there
are a lot of people who tune in by accident.
Speaker 2 (32:06):
Then they start listening. I get this wherever I go listen.
I listened for a week. I listen to I said,
I like this guy. Click what he has to say.
Speaker 1 (32:14):
Mark Levin Tonight at ten oh six on fifty five
krs the talkstation, Welcome to here.
Speaker 2 (32:20):
I do think he is too old to run.
Speaker 7 (32:22):
In twenty twenty.
Speaker 2 (32:23):
Four, fifty five krs the talkstation.
Speaker 4 (32:30):
You're listening to simply money because I buy all Worth Financial.
I'm Bob sponseller along a flying up n Give a
financial question you'd like for us to answer. There is
a red button you can click while you're listening to
the show, right on the iHeart app. Simply record your
question and it will come straight to us. Dave and
Mary live in Mainville and Brian.
Speaker 2 (32:50):
They're wondering.
Speaker 4 (32:50):
They say, Hey, we're in our early sixties and considering
partial retirement. How do you plan cash flow when income
becomes unpredictable? Yes, question, This is a great question. This
is kind of the key of financial planning.
Speaker 6 (33:04):
We become so accustomed, Bob to living off of o
PM other people's money. Somebody has to give me some
kind of check or something so that I can pay
my bills. That's in the first for the first forty
fifty years of our lives, that's a job, and then
for the remainder it becomes social security or whatever pensions
we've built up. What we tend to do, though, is
ignore the fact that if we've done the right things,
then there's also a significant nest egg out there that
(33:27):
can support those bills, and that itself becomes you know,
that becomes your own money, of course, and so so
how to plan around this, Well, A lot of people
want to focus on the I need it to spit
out a predictable stream of income. So maybe I'm gonna
do CDs or bonds or just something where I know
what's coming and when. And that's fine, except the what
happens there is we often rob the ability for growth
(33:48):
from that portfolio. So look, I would say, you know
you're gonna you're gonna definitely want to keep something related
to growth, which growth can be unpredictable. Something needs to
be growing, even for the littlest old widow out there,
we still need some growth keep up with inflation. So
just understand market history and understand model out what it
would look like if you invested in a certain portfolio
and pulled a couple thousand dollars out of it every
(34:08):
month to bridge the gap between your your your social scurity,
pension checks and what your actual bills are, and then
understand what it does when the market goes up and
most importantly, when the market goes down. So it doesn't
have to be predictable. It's not as predictable as a
you know, as like a pension or a job. But
at the same time, that doesn't mean that that is
a bad thing. You just have to be used to
you know what what that could look like. So stress
(34:28):
test and understand it. Moving to Brian and levinon Brian's
got about two million dollars in retirement accounts and he
says their portfolio is mostly index based, but he's curious
if they're missing out on some more tactical active management opportunities.
Bob's gonna have a field day with this. Is there
a case Bob for active management at this level?
Speaker 4 (34:47):
Well, Brian, there can be, and I'll say there can be.
So you know, when when you talk about index portfolio.
And this is why we like a term we use
around here is core satellite portfolios, meaning the vast majority
of the assets in any what i'll say moderate to
growth based portfolio are mimicking the large you know s
(35:08):
and P five hundred Nasdaq type of indices. And we've
talked on this show multiple times that active money management,
you know, netta fees typically underperforms a good index index
based you know fund like what you own, so you're
not doing anything wrong for sure. There are opportunities, however,
for active management in other asset classes, and you got
(35:31):
to look around and look at some of those you
know typical or certain parts of the bond portfolio. You
can make a case for active management there things like
small cap stocks, emerging market stocks there are, and then
some having some non correlated asset classes in your portfolio
that can increase return and lower risk.
Speaker 2 (35:51):
That's a reason to.
Speaker 4 (35:52):
Have some active man Apart from active you know management
and returns, there's a bit there can be a big
case for using some active management from a tech standpoint.
I know you talked about all your money is in
retirement accounts. We're now talking about non retirement accounts for
where having a good tax managed strategy running in the background,
(36:14):
harvesting short term losses, using those to offset gains.
Speaker 2 (36:18):
Those are often at.
Speaker 4 (36:19):
A ton of value to a portfolio. So there's reasons
to have some of this stuff in there. It's on
a case by case basis, but it's a great question. Brian,
all Right, Ron and Mason. We've got a says we've
got a paid off house, but a lot of equity
sitting idle. What's the smartest way to use that equity?
Invest downsize or just leave it alone.
Speaker 2 (36:42):
Yeah, this is that way.
Speaker 6 (36:43):
We'll get this question quite as often anymore. I got
it a lot when when mortgage rates were in the
you know, the three percent range, sometimes even two percent,
because people are simply looking at this is the hundreds
of thousands, if not millions of dollars that I've got
sitting here in an asset that's not spitting out any income.
Speaker 2 (36:57):
How can I take.
Speaker 6 (36:58):
Advantage of that? Well, really, the only way to advantage
of it is to is to somehow you know, borrow
against it to pull the money out, unless you're going
to airbnb one of your rooms in your house and
have awkward meetings in the hallway with strangers. There's not
really a good efficient way to get money out right now.
If you're going to borrow against your home, you're going
to be paying about six percent in a home equity line.
I don't think that that that's.
Speaker 2 (37:18):
The worst thing.
Speaker 6 (37:19):
If you actually have a need, that that can be
a pretty good way to finance a significant uh, you know,
an expense you have. Maybe it's a better deal than
you can get from the car dealer or buy a car,
or maybe you need you know you're gonna use it
for college expenses, something like that.
Speaker 2 (37:32):
But simply to.
Speaker 6 (37:33):
Pull money out and and use it to make an
investment that you hope is going to earn more than
six percent, I don't think that's worth it right now.
So I would focus on am I happy in my home?
Is this the place that I want to be? If not,
then let's think about some kind of different arrangement. But otherwise,
don't treat it as a piggybank.
Speaker 2 (37:50):
All right.
Speaker 4 (37:51):
If you're paying seven hundred dollars or more for a
premium credit card, rising fees might force you to choose
which one of those cards is actually worth keeping. Will
help you evaluate your options. Next, you're listening to Simply Money,
presented by all Worth Financial on fifty five KRC the
talk station, Mark Levin.
Speaker 10 (38:10):
We Americans, we patriots are irrational people. Irreasonable people, the
people who know good from either right from wrong. We
also know hustlers and Marxists and fascists in Islamis who
endanger our country every damn day. We're destroying our culture
into civil society, who are breeding a youth that hates
America and embraces the wrong thing.
Speaker 1 (38:29):
Mark Levin tonight at ten oh six on fifty five KRZ,
the talk station.
Speaker 8 (38:35):
The reliable information and of course not just one sided.
Speaker 2 (38:39):
Views, news that affects you.
Speaker 1 (38:40):
At the top end to bottom of the hour, fifty
five KRZ the talk station.
Speaker 4 (38:50):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponseller along with Brian James. Many people have
these high end credit cards, riding the perks and weaving
between the value among the different cards. But now with
these issuers starting to, you know, increase annual fees, the
question is shifting from should I get a premium card
(39:13):
to which premium card I should keep? Brian in all
honesty for questions like this one, you know I come
to you for this stuff, because I know you study
this stuff and know a lot about it. I'm I'm
very eager to hear what you have to say on
this topic, and I mean that in all honesty.
Speaker 6 (39:29):
Yeah, my family has gotten a lot out of the
credit card reward game. We had a credit card over
twenty years that was paying money into a five twenty
nine plan and I'm now very happily on the back
end of that pulling dollars out for tuition. It was
free money and it was one of the smartest things
I've ever done. So why are their higher fees in
these cards? Well, the credit card issuers, Remember these aren't
the banks. There are two entities behind your credit card.
(39:50):
It's the credit card issuer, that's Visa MasterCard. They're the
ones who want the spending because they're taking a haircut
off of every little transaction. Every time you wipe that
you swipe that card, they get two or three percent,
sometimes even four. And they know that typical premium card user,
if you've already got a fee on your card, then
that's got it. Then that's a premium card out there.
They know these people are high spenders. Pay off the
balance every month. And is a low credit risk. Those
(40:11):
are the customers the issuers want. The banks behind it
want somebody who's going to let it go and ignore
it so they can charge them the ridiculous interest rates
twenty five twenty eight percent. So what they're hoping is
that fewer card holders overall, but those stickier relationships and
more interchange spend focused on that one card that they
think is the best one to use. That's what I did,
like I said, for for a long time. So how
(40:32):
do you think about this, run a break even analysis.
If you've got two or more of these premium cards,
make a spreadsheet, figure out your real usage. You know,
are you really using those lounge visits and the hotel
airline credits? Are the lounges open? I have one of
these cards in about half the time there just isn't
room they'll let you in the time that you've got
to lay over. Make sure you're actually getting the value
out of these different perks. Are you using the free
(40:53):
thing that they give you?
Speaker 3 (40:54):
You know?
Speaker 6 (40:55):
So sometimes both cards will cover lounge access or global
entry TSA pre check. Got that twice, you really only
need it once, So one of them is redundant. And
that has no value for you. But at the same time,
if you decide you're gonna cancel one of them, first off,
be super careful. Don't cancel you low your oldest credit card,
hang onto that one unless it's an enormous fee. You're
gonna want that twenty twenty five years where because that's
(41:16):
what's giving you a lot of your credit score. But
if you are going to cancel one, ask for retention.
They might throw you a better deal, some kind of
hidden perk or something that they only hold back when
somebody wants to or offer out when somebody wants to cancel.
But again, the whole point of this is just be
aware what are you using. A lot of cardholders just
never redeem these credits or they just don't use all
the benefits. Some of the perks are just too hard
(41:38):
to use, so they look great in the brochure, but
you never actually use them. So just understand what it
offers you and whether you value that.
Speaker 2 (41:45):
Great stuff.
Speaker 4 (41:45):
Brian, And this is why I'm so blessed to have
you around to give me advice on stuff like this,
because I honestly I never look at it at all,
but good stuff, all right, Thanks for listening. You've been
listening to Simply Money, presented by all Worth Financial on
fifty five KRC, the talk station.
Speaker 9 (42:01):
In order to live your dream doesn't always involve a
pay cut invest your time. Sometimes it involves a pay
cut to get moving and then move.
Speaker 2 (42:09):
Up and invest in your future.
Speaker 9 (42:11):
But I would want a path to make more than
I made, not less than I made.
Speaker 2 (42:14):
Dave Ramsey.
Speaker 9 (42:15):
There's a lot of people need help in this world.
Speaker 2 (42:17):
I want you to get clear.
Speaker 9 (42:18):
I want you to spend some time very carefully going
through what are your talents, what are your passions or
your skills? You know, what is it you value?
Speaker 1 (42:27):
Weekdays at seven by fifty five KRZ the talk station
all Right.
Speaker 2 (42:32):
Holiday time
Your number one tree set on the iHeartRadio app.
Speaker 2 (00:03):
It makes it easy to stay connected because I just.
Speaker 3 (00:05):
Put on the app.
Speaker 1 (00:06):
Fifty five KARC the talk station.
Speaker 4 (00:14):
Tonight Marcus react to government shutdown news, How to react
to a possible change to your four to one k
and we answer your questions. You're listening to Simply Money
presented by Alworth Financial. I'm Bob Sponseller along with Brian James.
Speaker 2 (00:28):
Well.
Speaker 4 (00:29):
It appears that the government could be back open for
business later this week. It sounds like it at this point.
Joining us right now is all Worth Chief Investment Officer
Andy Stout to provide the economic implications of this news.
It's been a pretty active news flow over the weekend. Andy,
bring us up to speed here on the status of
the government shutdown.
Speaker 3 (00:51):
Well, I'm sure most of us probably saw the news
last night where the Senate has basically agreed to a
solution to move things forward. They got some Democrat senators
on board with the Republicans and you get to the
necessary votes. Now moving on to the next step where
essentially going to the House for approval.
Speaker 5 (01:12):
That'll probably happen sometime this week.
Speaker 3 (01:15):
The timing is still a bit unclear as to when
that will happen, but after the House likely approves, then
it will go to the President to sign. Now, what
that means in all likelihood is that the government probably
reopened sometime around the middle of the week. And from
my perspective obviously, well, first of all, obviously that's good
news for those people.
Speaker 5 (01:36):
Who are for a load and have missed the paychecks.
Speaker 3 (01:38):
From an economic standpoint, when looking at the data that
we've been missing, we have now finally a bit of
clarity on the horizon. Now probably won't see anything this
week in terms of economic data being released because I remember,
the government has to recall all the staff and then
they got to start to put all the data, collect
the data, put all the data together, and then we
can start to see some information line CPI, GDP retail sales,
(02:03):
But don't expect anything this week.
Speaker 5 (02:05):
Most likely it'll be a data.
Speaker 3 (02:09):
The floodgates are going to open really over the next
couple of weeks in regards to data, and that's going
to be very beneficial for the Federal Reserve as they,
you know, try to figure out whether or not the
economy is chugging along or is finding a bit more
crafts When they start to look at the actual data.
You know, some of that cracks we've been seeing are
(02:29):
on the labor side, and so getting some official data
is going to be beneficial.
Speaker 6 (02:35):
So Andy, this doesn't actually, if I'm not mistaken, we're
kicking the can a little bit here, right, I mean,
this is gonna This does not resolve the issue that
the Democrats want, which is the the the extension of
the subsidies for the Obamacare premiums. But we're basically committing
to have a vote on that at some point in
the future. Is that is that part of this is
(02:56):
I'm not mistaken, We're going to be having this conversation
again in the next over the next six weeks, right.
Speaker 5 (03:01):
Yeah, that is definitely part of that.
Speaker 3 (03:03):
And then also this is a continuation for the government
to reopen. Is really just through the end of January.
So market on your calendars now for maybe some additional
well I don't know if i'll say volatility, but definitely
some tension when it comes to the political framework.
Speaker 4 (03:22):
All right, Andy, let's get into some data that we
actually do have, and I want to talk about household debt.
It looks like household debt climb to a record eighteen
point six trillion dollars in the third quarter. That's about
a three point six percent increase from a year ago.
Speaker 2 (03:36):
Even though that's at.
Speaker 4 (03:37):
A new new high, the pace is roughly in line
with three point seven percent wage growth over the last year.
So the data on the surface of it suggests that
consumers are not over extending themselves at a high level
at this point. But with the student loans having to
be repaid now after the repayment pause you know under
(04:00):
the last administration, that's where at least it appears that
we're seeing some cracks here because we're seeing some delinquencies
on these student loan payments.
Speaker 2 (04:10):
It just sounds like the.
Speaker 4 (04:11):
Lower end, you know, entry level consumers in this economy
that are saddled with student loan debt and everything else
trying to get started. Those are the people that are
really struggling right now, and that might explain some of
the election results in New York City last week.
Speaker 3 (04:29):
Yeah, when you look at just the overall big picture
in terms of the consumer and the consumer's health, I mean,
really spending has been keeping the economy going. Consumer spending
represents about sunny percent of the economy. But when you
look at some of the data that we've got very recently,
and I say data we've got, it might seem kind
of weird. However, that's because we haven't been getting hardly
(04:51):
any data. But we've been getting data from some other
sources like private parties, private companies, but also from the
Federal Reserve, because the Federal Reserve is not affected by
the shutdown, and the Federal Wazer posts this consumer data. Yeah,
what it did show was that when you look at
the household debt hit another record eighteen point six trillion
for the third quarter. Now the first thing people think, oh, no,
(05:12):
another household debt record level. Keep in mind, these are
in what's what we call nominal terms, so they're not
adjusted for inflation. Now, when we look at inflation that's
out there, we look at wage growth, we look at
just general prices. Basically, this three point six percent growth
is pretty much in line with what wage growth has been.
So it's not as if consumers are really going too
(05:33):
far out over their skis compared to where they were
at least last quarter. So it's not really a macro
threat when you look at the total data. However, when
we look at certain subsectors of the data of the
debt levels, like student loans, that's a bit concerning credit cards.
Speaker 5 (05:49):
That's also a bit concerning.
Speaker 3 (05:51):
So like on credit card debt, you know, that jumped
almost six percent, so definitely more than wage growth, definitely
more than just general inflation. And also the delinquency and
I'll look at the serious delinquency rate, so that's credit
card balance is more than ninety days past due. You know,
those are right around seven percent, and that's pretty much
where they were, but it's still a relatively high level,
(06:12):
especially compared to just a bigger history. Normally that credit
card debt, you know, might be closer to some lower
levels when you look at it, it's usually around i'll
call it five percent in that general area going back
to about two thousand and three. So credit card debt
is a concern. Student loan debt that's another really big
(06:34):
concern because if you remember, you know a lot of
the student loan payments have been basically deferred for a
while because of COVID. Now that it opened back up,
we saw serious delinquencies jump from basically under one percent
last year to over fourteen percent. So these are something
that we This is an area one I'll watch really
(06:55):
close to because that's a stressor that some people are seeing.
So now government reopening and that's going to be definitely
something that can help us move forward.
Speaker 6 (07:04):
And it seems that the consumer has noticed too, because
the University of Michigan had their Consumer Sentiment Index come
out and that dropped to a little over fifty in November,
and that's the weakest level we've seen in a couple
of years. So it would seem that this isn't happening.
You know, behind the scenes, people are well aware of it,
and their concerns were shared about not only their own
personal finances but business conditions in general. And actually most
(07:25):
households expect unemployment to go up over the next year,
so they're not seeing happy things on the horizon. Do
you agree with with what the herd is saying there
or do you think there's a different outcome.
Speaker 3 (07:34):
No, I absolutely agree with what they're feeling when they
were asked. And you got to remember, whenever someone has
asked something about how they feel, kind depends on what's
going on in the environment, and that environment has been
overshadowed by the government shutdown.
Speaker 5 (07:48):
That's definitely affected.
Speaker 3 (07:49):
So what's going to be really interesting to see what
sort of rebound we may see in the next Consumer
Center report when we get that with the government reopening
and hopefully stay saying open been for a while. But yeah,
when you look at some of that data, Brian, essentially,
the data we've gotten last week, it's been you know,
a little bit kind of a little bit hairy.
Speaker 5 (08:09):
I mean, we saw the that's the layoff notice.
Speaker 3 (08:14):
It's reported by Challenger, the Challenger layoff notices that jumped
to one hundred and fifty three thousand. That was the
highest October announcements in terms of layoffs in more than
twenty years. So you know that that was a big number. Now,
not all the data that we've gotten, excuse me, from
private companies has been bad. You know, last week we
(08:35):
got ADP Data, which is a big payroll company, and
they showed that total private payrolls increased by forty two thousand.
So that was pretty good, especially considering that we've had
two months of decline. But when you look under the
hood a little bit, what we see is that large
companies were really the reason for this. Large companies essentially
added seventy four thousand and in large companies basically five
(08:57):
hundred plus employees, but companies under that actually cut thirty
two thousand jobs last month, So when you look at that,
it's not as pretty as it looks a little bit
of a mixed picture when it comes to labor reports
that we've been getting last week, But overall, it is
something that I would call definitely some cracks are forming,
and we need to see how those cracks are continued
(09:18):
to progress as we get more and more data, because
that's going.
Speaker 5 (09:21):
To have a big impact on what the FED does.
Speaker 4 (09:23):
Andy, I want to get your take on maybe what's
going on here with that latest ADP report. It seems
a bit counterintuitive to me when everyone's talking about the
potential of AI really disrupting the labor market causing jobs
to go away for a lot of people. I would
have expected these huge, large companies that are already implementing
(09:43):
a bunch of AI technology to be the ones laying
off people, when you know, at least for the October report,
it's the businesses with fewer than five hundred employees that
cut the jobs.
Speaker 2 (09:54):
What are what do you see as.
Speaker 4 (09:56):
The reasons behind smaller employers cutting while larger employers actually
adding jobs.
Speaker 3 (10:04):
Yeah, well, that's a very interesting take, and I think
what you really also need to look at is you
need to look at the sector levels within those ADB reports.
So one thing you can look at is that a
lot of the gains were concentrated in what i'll called
trade and utility companies.
Speaker 5 (10:21):
I was about forty seven thousand of that.
Speaker 3 (10:23):
Financial service companies added another eleven thousand, and education healthcare
was also a big benefit benefactor, I guess I should
say or whatever, adding twenty five thousand.
Speaker 5 (10:34):
Now we saw declines in some of these.
Speaker 3 (10:35):
Other areas like it, which actually to your point regarding AI,
they dropped the total number of jobs by seventeen thousand.
So at the sector level, AI is having impact, especially
on those information companies. But to your point, also larger
companies are taking advantage of AI and they're probably a
little bit more able to essentially implement a lot of
(10:58):
these AI projects that would you know, allow them to
reduce their workforce. But what a lot of them are
doing it's more of a they're not hiring and they're
just not firing either. It's like a no hiring, no
firing for these larger companies on the whole. So they're
looking to use AI to get more out of their
current workers, but still not higher additional companies now are
(11:20):
additional employees now. The other thing I want to mention,
just really quickly on the jobs front, the Chicago Fed
release their.
Speaker 5 (11:27):
Unemployment rate proxy.
Speaker 3 (11:30):
It's kind of nice because it gives you a good
idea of what's going on without actually getting.
Speaker 5 (11:33):
The data from the government.
Speaker 3 (11:35):
And what they showed is that the unemployment rate likely
moved up just a hair from four point three to
four point four percent, so still pretty low from an
overall perspective.
Speaker 6 (11:45):
Any and maybe you address this, and I hope it
didn't miss it, apologies if I did. But do the
numbers whether we're talking about Challenger or assume not ADP
because ADP doesn't do the federal payroll. But do those
include the federal furloughs we've been talking about the last
couple of months, or are we setting that aside?
Speaker 3 (12:00):
Well on the Challenger stuff, it certainly does not, because
it's really just about whether or not companies are announcing,
and so it's going to be your private companies and
ADP the furloughed workers, those are all going to be national.
So when we talked about that forty two thousand new
jobs in seventy four thousand other or yeah, coming from
(12:21):
the larger companies.
Speaker 5 (12:23):
You know, those are not going to impact for load workers.
Speaker 3 (12:25):
However, what it does impact is the essentially the companies
that were impacted in like local company, local economy areas
by the furlough furlowing.
Speaker 6 (12:35):
The federal government's doing less, so the companies that support
them are in turn doing less. So it's not a
direct account of people who have been furloughed, except for
businesses who serve those people have laid off their ow employees.
Speaker 5 (12:46):
You said that much better than I was about to,
So thank you.
Speaker 2 (12:48):
I do what I can.
Speaker 4 (12:49):
All Right, guys, we're gonna have to leave it there
for tonight. Thank you for joining us. As always.
Speaker 2 (12:54):
Andy.
Speaker 4 (12:55):
Coming up next, a giant in the retirement plan world
is shaking things up. Well you what that could mean
for your four one K, your asset allocation, and your
long term income plan. You're listening to Simply Money, presented
by all Worth Financial on fifty five KRC.
Speaker 2 (13:10):
The talk station.
Speaker 1 (13:13):
Story coming out of City Hall today.
Speaker 2 (13:15):
Us when you need it.
Speaker 1 (13:17):
He said that what I was hearing locally, nationally, everywhere
in between fifty five krc D talkstation.
Speaker 7 (13:26):
All Worth Financial a registered investment advisory firm. Any ideas
presented during this program are not intended to provide specific
financial advice. You should consult your own financial advisor, tax consultant,
or estate planning attorney to conduct your own due diligence.
Speaker 4 (13:46):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponsoring along with Brian James. If you can't
listen to Simply Money live every night, subscribe and get
our daily podcast. You can listen the following morning during
your commute, or during your workout at the gym, or
in your during your evening walk around the neighborhood. Think
about how fun that might be. And if you think
(14:07):
your friends and family could use some financial advice, tell
them about us as well. Just search Simply Money on
the iHeart app or wherever you find your podcast. If
you've built a couple million dollar portfolio, balance in retirement accounts,
and if you have a paid off home and are
sitting on cash wondering what to do next, You're not alone.
(14:28):
We're going to answer questions about all of that and
more straight ahead of six forty three be honest. How
often do you check your portfolio balance? A new study
done by a research firm called dy Neta found that
almost half of all investors are checking their investments performance
(14:48):
once a day or more.
Speaker 6 (14:50):
Brian, I'll admit it. I do this way more often
than I should. I'm human too. It's fun, right. I
know it's going to panic. When it's negative, I just
quit looking at it. But when it's when things are
going up and the net worth is reaching heights it
hasn't before, I know full well, I'm going to give
a chunk back.
Speaker 2 (15:06):
That's how life works. And I checked the.
Speaker 4 (15:09):
I check the balance of my doge coins about every
fifteen to seventeen minutes.
Speaker 2 (15:13):
It's a it's a wonderful dopamine rush.
Speaker 6 (15:15):
You own no doge coins, don't, don't.
Speaker 2 (15:18):
I know you better than that.
Speaker 6 (15:20):
You wouldn't know where to buy doge coins. I'm teaching,
But yeah, no, I do it too, you know, And
this survey tells us, you know what, why are people
doing this?
Speaker 2 (15:27):
Well? I can tell you exactly why I do it well.
Speaker 6 (15:29):
When markets are volatile, people look more often because we're
thinking about it, right that it's in the headlines, it's
in my face. In between my meetings, I catch a
headline on my phone and maybe something good is happening,
maybe something bad's happening. Well, I can't resist. I got
to go see what's happening in my own portfolio. Gives
us the illusion of control, right, we believe that. You know,
sometimes we think if we're always looking at it, we're
going to be able to react quickly or prevent losses,
(15:51):
or maybe jump into something before it makes the big run.
Speaker 2 (15:53):
This is why there's a whole.
Speaker 6 (15:56):
Part of the academic world called behavioral economics, and they,
the economists there, call this the control fallacy. Staring at
it doesn't improve outcomes. It just amplifies stress. Right, If
we watch that pot of water boil, it is not
going to make it boil any faster. Matter of fact,
our brains are going to think that it's not boiling
fast enough.
Speaker 2 (16:15):
Well, but we can, again, we can feel like we're
at least controlling its watching it. We all know that's
not the case, but it's just how our brains get wired.
And I think that leads to this next point. We
let's face it, we all live in a what we'd
like to call a refresh economy. Right now. What does
that mean?
Speaker 4 (16:33):
Well, people check their likes on social media, they check emails,
they check news in real time, and let's face it,
investor behavior has followed suit.
Speaker 2 (16:43):
We're all used.
Speaker 4 (16:44):
To staring at these apps and just constantly looking at screens,
and it tends to move over to the investment world too.
Speaker 2 (16:52):
It's just natural behavior. We just like to see things
moving around. We like to see colors change, we like
to see like we like to see news updates.
Speaker 4 (17:02):
And people know that's the case. We've talked about that
humptying different times. That's how the whole media and social
media business platform has been built to glue us to
that screen and keep us looking at everything all the time.
We just got to be mufthful of that because sometimes
if you look at your investment, you know, balance, too
(17:24):
often you're going to be driven to make a decision,
right because you know, it goes back to that control thing.
I see it moving around, I must do something, and
usually nine times out of ten, that's something that we
do ends up not being a good decision.
Speaker 6 (17:39):
Yeah, and I've been fascinated by this, you know, I've
been doing this for thirty years and the things that
get people's attention, including myself. I'm human too, and I
have the same goal as my clients do. I want
to retire someday and get the kids through college and
all that other stuff. But that's been fascinating to me
to understand why that occurs. And at the end of
the day, Bob, we are all between our ears. We
(17:59):
have lunch meat and chemicals. One of our favorite chemicals
in there is dopamine, and we get dopamine no matter what.
It gives us that little emotional hit, even positive or
negative news, just something, some kind of new stimulus gives
us a little shout of dopamine, and it turns out
that's what we're after. That's why we pick up our
phones a thousand times a day, just to see whatever
baloney headlines or whatever meaningless notifications are there for me
(18:20):
to react to. And then there's I can't really remember
the last time I picked up my phone, looked at
it and realized, yes, there, I should do something about
this news headline. This should cause me to act in
some way. No, it's just me getting my little dopamine
hit and then going back to work or whatever I
was doing before until I get the urge to do
it again. So I've been really trying to be more
mindful of that. How how rarely it actually means anything.
(18:42):
So anyway, So that's the dopamine side of things. There's
also fear of missing out or what I like to
call fomo. When news breaks about, hey, the market's hitting
a record high, AI stocks are swaring well, well, that
causes us to feel like we're gonna miss something. I
better be watching, or I'm going to miss out on
an opportunity to be a to be a bazillionaire tomorrow. Really, really,
this is super common among younger investors and people who
(19:02):
started investing really just in the past three years, which
have been really really positive ever since twenty twenty two,
and so looking every day has been a rewarding experience.
If you just started looking, just started investing in the
last three years, you start studying your market history because
it's not always going to be this way. You will
there will be a time where there's twelve eighteen months
(19:23):
you just do only want to look at your four
one k. It's just too darn depressing. However, that's part
of the game. You have got to get used to that.
If you have young people in your lives who have
just started their four one ks, just started investing. Teach
them market history, show them what twenty twenty two looked
like two thousand and eight oh two. These are things
that will happen, are virtually guaranteed to occur again. We
have to be able to anticipate them and make sure
(19:44):
we can ride them out. Otherwise we start making bad
decisions like trying to time the market, which usually means
getting out at the bottom, or trying to make it
up with super speculative assets, which can exacerbate things. And
all of that robs you of years of building wealth
for sure.
Speaker 4 (19:58):
And I think another another reason people just get addicted
to checking all this stuff. You know you talked about
fear of missing out. There's another thing out there, and
it's just straight, you know, fear in general, past market trauma.
People who live through the dot com bust, the Great
Financial Crisis or COVID remember how fast things can change.
(20:20):
And let's face it, in today's political divide, where I mean,
depending on where you get your news sources, and I'm
talking to people on both sides of the aisle here,
you know, for you know, an app like X for example,
Brian I'd say sixty to seventy percent of the stuff
that flies around on there, it's unverified. You don't know
(20:40):
whether that's real news, fake news, or anything in between,
or just straight out lies and propaganda.
Speaker 2 (20:46):
But if we get that fear thing, we're.
Speaker 4 (20:49):
Just waiting for the next shoe to drop, the next
thing to implode our portfolios. And a lot of people
are walking around with that all day every day. When
that causes people to check their portfolios more than they
should and again make decisions that they.
Speaker 6 (21:05):
Probably shouldn't make and sorry, and then life changes too, Right,
So big life events retirement, job change, marriage, divorce, inheritance,
new baby in the house, new grand baby around, that's
a great time to kind of look at things as
a trigger. So the investments might still be fine, but
something changed in the outside of your big picture shifted
a little bit, so maybe your mix needs adjusting. But
(21:26):
if those big things aren't happening, let your portfolio alone.
If it was fine before, it's still fine, just look
at it when there's new information to react to. Also,
of course, in this I think goes without saying, when
you're near a milestone, if you're sneaking up on retirement,
or you've got a big purchase to make, maybe paying
off college something like that. That's a time to review
where's the risk in my portfolio. So I've got this
(21:47):
big expense coming up, Am I using dollars that could
go over the cliff tomorrow just before I have to
pay the bill? If that's the case, then I might
be making mistakes. So maybe I need to take some
risk off the table rather than waiting until it's literally
time to write the check to whomever is going to
take that money from you. So the closer I am
to using that money, the more important it is to
shift from growth to preservation. Take the gains while they're there.
(22:08):
And we've talked about this ad nauseum all year long.
I think, Bob, this has been a great run, great
couple of years. If you've got an upcoming bill in
the next couple months, maybe even the next year, you
might take those dollars off the table. So it's not
hard to write that check. Should the market take a dip, Yeah, I.
Speaker 4 (22:23):
Mean you've been getting into reasons why you should check
your portfolio and responsibly review your strategy.
Speaker 2 (22:29):
And I'll say this.
Speaker 4 (22:30):
Gets into whether you're a self directed investor or whether
you work with a good fiduciary advisor.
Speaker 2 (22:37):
Here's the all Worth advice. If you've got a good.
Speaker 4 (22:39):
Financial plan the portfolio, remember that it's just the engine.
You don't need to look under the hood every day
to know that the engine is running. Coming up next,
how old is your Internet router? That's a question you
should probably answer very soon, and we'll explain why you're
listening to Simply Money, presented by Allworth Financial on fifty
(23:00):
five KRC the talk station.
Speaker 2 (23:04):
Something is happening.
Speaker 1 (23:05):
It's time to end the failed experiment of open borders.
Speaker 7 (23:08):
Your countries are going to hell.
Speaker 2 (23:10):
Something in our country, Charlie Kirk, I forgive.
Speaker 6 (23:13):
Them Antifa across this country would be.
Speaker 8 (23:15):
Trump assess and Ryan Ruth guilty on all five charges.
Speaker 4 (23:18):
Something in our world, Jato countries should shoot down Russian
ear crash shank you in all day they.
Speaker 7 (23:24):
Enter their ear.
Speaker 2 (23:24):
See it's always something.
Speaker 9 (23:26):
Yes, I do.
Speaker 1 (23:27):
It's a very important moment. Fifty five KRC the talk station,
and I'm Marto.
Speaker 7 (23:32):
Lopez here and right now iHeartRadio station.
Speaker 2 (23:39):
You're listening to Simply Money paused by all Worth Financial.
Speaker 4 (23:42):
I'm Bob Sponseller along with Brian James, joined tonight by
our real estate expert Michelle Sloan. Michelle, thank you, as
always for spending time with us tonight. We're gonna call
this segment fixer upper regret.
Speaker 2 (23:55):
Give us some advice.
Speaker 4 (23:56):
On what not to do in terms of piling money
into a house that we potentially might want to sell someday.
And you know, how much is too much and what
area is the wrong area to quote unquote invest in
when putting money into a home that we might want
to reap that investment back later.
Speaker 8 (24:16):
Well, that is a loaded question.
Speaker 2 (24:18):
I don't know.
Speaker 8 (24:19):
I think there is a movie out there called The
Money Pit. Yeah, and sometimes.
Speaker 2 (24:25):
I've lived in one of those before.
Speaker 8 (24:26):
You have to be really, really careful because you have
to know what you're doing. You can't just go into
this real estate thing blindly. And do you are you
planning to buy a fixer upper to live in? Are
you planning to buy it as an investment? Do you
have the wherewithal and the knowledge even to get into
(24:49):
something like this because it is definitely not for the
week or someone who doesn't.
Speaker 2 (24:54):
Have deep pockets.
Speaker 8 (24:56):
So I've seen quite a few properties over the years
I've been in business in real estate, selling real estate
for twenty years, so I've seen some people that have
gotten themselves in over their head. And if that's the case, again,
you just have to know when to say when. But
you really need to set a realistic budget. And if
(25:18):
you're buying a home as a fixer upper knowing that
it's going to need work, do not Here's my number
one tip. Do not skip the inspection because that's going
to tell you if it's more cosmetic items that need
to be updated, or if it's something that's going to
cost a lot more money and it's not as sexy,
(25:40):
if the wiring needs to be changed, Sure, you know
something like that.
Speaker 6 (25:45):
But do people have that option nowadays? I mean, with
houses going as fast as they have and I realize
things are slowing, but is something that is a true
fixer upper? Does that hang out on the market a
little longer because it spooks enough buyers away. Because I
feel like a lot of other most of my clients
are telling me I don't have the too, I can't
do an inspection because somebody's gonna throw cash at this
and not want an inspection. So if I really want it,
(26:06):
I got to forego.
Speaker 2 (26:07):
That is that an option.
Speaker 8 (26:08):
The market is changing, and you can get an inspection out.
And here's the thing, it doesn't matter what's happening in
the market financially. You have to be smart. You guys
say this all the time, you know, just because you
get emotionally attached to a property. And I've showed so
many properties to buyers where they're like, oh my gosh,
(26:29):
look at this view. And then I say, but look
at the foundation. It's crumbling and this house is going
to fall off the side of the world any minute.
Speaker 4 (26:39):
Now.
Speaker 8 (26:40):
It doesn't matter how much it costs to buy it.
But again, you have to know what is it going
to cost to fix it up and make it safe
and make it stable. And again, if you don't know
what you're doing, and a lot of times it is
really important to have someone with some experience as far
as your realtor who's going to tell you the truth
(27:01):
whether you want to hear it or not. I remember
that specific buyer. It was a house in Mount Adams.
It was looking over it at the city. It was gorgeous,
but the place was crumbling and it was about to
fall off the side of Mount Adams. And so I said,
you know what, you don't have the funds because when
you're setting a budget, you've got the purchase price. But
(27:24):
then most people underestimate the cost that it is to
actually fix it up. You can't just foundation issues. You're
not You're not just putting you know, filler in some cracks.
Speaker 2 (27:38):
So you have.
Speaker 6 (27:41):
No no, no, it's.
Speaker 8 (27:42):
It can be very very costly if you jump into
something and only look at it with your heart and
not your mind.
Speaker 2 (27:51):
Hey, Michelle, speaking of investing with your heart not your mind.
Speaker 4 (27:55):
You know, take me through if this has ever happened,
you know, with with your customers.
Speaker 2 (27:59):
I mean, people go in with the best of intentions.
Speaker 4 (28:01):
They buy a house and they think they're going to
live there forever, and they want it to be perfect,
so they just start fixing it up.
Speaker 2 (28:08):
They want it to be, you know, perfect for them,
And I.
Speaker 4 (28:11):
Think sometimes people will invest money in the house to
the point where now they have the most expensive house
on the street, or you know, the most expensive three
bedroom compared to other three bedroom houses in the street
or the subdivision. Don't you have to kind of, you know,
in spite of your heart and how nice you want
things to be, don't you always have to kind of gauge,
(28:33):
you know, how much do we have into this house
versus what it could potentially sell for. Because people think
they might live in this place forever and then somebody's
job gets transferred or they just have a change of
heart and mind and want to move.
Speaker 2 (28:46):
I mean, don't.
Speaker 4 (28:47):
Don't you have to kind of you know, price this
stuff out on what the market will bear, so to speak.
Speaker 8 (28:52):
Absolutely, you really need to avoid over improving a home.
So for example, if you're gonnall a one hundred thousand
dollars new kitchen in a three hundred thousand dollars home,
your balance is off and you're not going to get
that money back, no matter how nice it is, You're
(29:13):
not going to get your money back if you decide
that you need to sell now. If money is no object,
have at it. But again, like I said, if it's
if it is a moderate cost based on the neighborhood
and the other homes around you, then that's a good
it's a good investment. If you are going just hog
(29:35):
wild because you won the lottery, okay, that's fine. You're
going to spend through all that lottery money and you're
gonna at some point need to sell that house. And
you've over improved it so much that there's no way
an appraisal is going to be able to come in
on and get you that money back. So you really
have to be prepared and ask all of the right questions. No,
(29:59):
have a have someone to talk to. Have your real
estate agent or a friend or a financial advisor talk
to them about the smart ways to invest in a property.
Maybe it's a fixer upper, maybe it's your own home.
You know, Scott and I have We have fixed up
(30:19):
every home that we've ever lived in, and we've done
a lot of the work ourselves, so we've saved quite
a bit of money. But it's interesting because when you
go to fix up the floor in the kitchen, then
it doesn't match the floor in the living room or
the family room, so then you got to do that,
and then you're going into a bathroom. I mean, it
just seems like it's snowballs. So one thing will lead
(30:41):
to another and lead to another, and before you know it,
you are spending a lot of money and a lot
of time and a lot of disruption.
Speaker 6 (30:50):
So you have to think about all of those things.
So let me ask a question from the other point
of view. Does this mean that I can go get,
you know, sixteenth of an inch thick cheap crappl from
the clearance thing and throw that down so that it
looks pretty for I mean that I'm being a little
facetious here, but obviously there's a good thing to do
and a bad thing to do. So what's the minimum
you should do if you need to.
Speaker 8 (31:10):
Sure, I mean, if you want to, if you want
to do quality that's going to last, especially if you're
going to be living in the home.
Speaker 3 (31:17):
Now.
Speaker 8 (31:18):
I've seen a lot of people that are flippers and
they've put the lower grade items, the lower grade flooring
in the homes. It looks good, but the quality's not there.
So it really depends on asking yourself, what is your why?
Are you renovating for yourself, your comfort and your longevity?
(31:39):
Are you renovating so that you could flip it, turn
it around and sell it? And those are completely different things.
You got to ask all of the questions before you
get started.
Speaker 2 (31:48):
Great advice, Michelle, Like a lot of things in life,
know your why. I love that advice you're listening to.
Speaker 4 (31:54):
Simply Money, presented by all Worth Financial Law on fifty
five KRC the talk station.
Speaker 1 (32:01):
Mark Levin.
Speaker 10 (32:02):
Probably the people who should be listening aren't, But there
are a lot of people who tune in by accident.
Speaker 2 (32:06):
Then they start listening. I get this wherever I go listen.
I listened for a week. I listen to I said,
I like this guy. Click what he has to say.
Speaker 1 (32:14):
Mark Levin Tonight at ten oh six on fifty five
krs the talkstation, Welcome to here.
Speaker 2 (32:20):
I do think he is too old to run.
Speaker 7 (32:22):
In twenty twenty.
Speaker 2 (32:23):
Four, fifty five krs the talkstation.
Speaker 4 (32:30):
You're listening to simply money because I buy all Worth Financial.
I'm Bob sponseller along a flying up n Give a
financial question you'd like for us to answer. There is
a red button you can click while you're listening to
the show, right on the iHeart app. Simply record your
question and it will come straight to us. Dave and
Mary live in Mainville and Brian.
Speaker 2 (32:50):
They're wondering.
Speaker 4 (32:50):
They say, Hey, we're in our early sixties and considering
partial retirement. How do you plan cash flow when income
becomes unpredictable? Yes, question, This is a great question. This
is kind of the key of financial planning.
Speaker 6 (33:04):
We become so accustomed, Bob to living off of o
PM other people's money. Somebody has to give me some
kind of check or something so that I can pay
my bills. That's in the first for the first forty
fifty years of our lives, that's a job, and then
for the remainder it becomes social security or whatever pensions
we've built up. What we tend to do, though, is
ignore the fact that if we've done the right things,
then there's also a significant nest egg out there that
(33:27):
can support those bills, and that itself becomes you know,
that becomes your own money, of course, and so so
how to plan around this, Well, A lot of people
want to focus on the I need it to spit
out a predictable stream of income. So maybe I'm gonna
do CDs or bonds or just something where I know
what's coming and when. And that's fine, except the what
happens there is we often rob the ability for growth
(33:48):
from that portfolio. So look, I would say, you know
you're gonna you're gonna definitely want to keep something related
to growth, which growth can be unpredictable. Something needs to
be growing, even for the littlest old widow out there,
we still need some growth keep up with inflation. So
just understand market history and understand model out what it
would look like if you invested in a certain portfolio
and pulled a couple thousand dollars out of it every
(34:08):
month to bridge the gap between your your your social scurity,
pension checks and what your actual bills are, and then
understand what it does when the market goes up and
most importantly, when the market goes down. So it doesn't
have to be predictable. It's not as predictable as a
you know, as like a pension or a job. But
at the same time, that doesn't mean that that is
a bad thing. You just have to be used to
you know what what that could look like. So stress
(34:28):
test and understand it. Moving to Brian and levinon Brian's
got about two million dollars in retirement accounts and he
says their portfolio is mostly index based, but he's curious
if they're missing out on some more tactical active management opportunities.
Bob's gonna have a field day with this. Is there
a case Bob for active management at this level?
Speaker 4 (34:47):
Well, Brian, there can be, and I'll say there can be.
So you know, when when you talk about index portfolio.
And this is why we like a term we use
around here is core satellite portfolios, meaning the vast majority
of the assets in any what i'll say moderate to
growth based portfolio are mimicking the large you know s
(35:08):
and P five hundred Nasdaq type of indices. And we've
talked on this show multiple times that active money management,
you know, netta fees typically underperforms a good index index
based you know fund like what you own, so you're
not doing anything wrong for sure. There are opportunities, however,
for active management in other asset classes, and you got
(35:31):
to look around and look at some of those you
know typical or certain parts of the bond portfolio. You
can make a case for active management there things like
small cap stocks, emerging market stocks there are, and then
some having some non correlated asset classes in your portfolio
that can increase return and lower risk.
Speaker 2 (35:51):
That's a reason to.
Speaker 4 (35:52):
Have some active man Apart from active you know management
and returns, there's a bit there can be a big
case for using some active management from a tech standpoint.
I know you talked about all your money is in
retirement accounts. We're now talking about non retirement accounts for
where having a good tax managed strategy running in the background,
(36:14):
harvesting short term losses, using those to offset gains.
Speaker 2 (36:18):
Those are often at.
Speaker 4 (36:19):
A ton of value to a portfolio. So there's reasons
to have some of this stuff in there. It's on
a case by case basis, but it's a great question. Brian,
all Right, Ron and Mason. We've got a says we've
got a paid off house, but a lot of equity
sitting idle. What's the smartest way to use that equity?
Invest downsize or just leave it alone.
Speaker 2 (36:42):
Yeah, this is that way.
Speaker 6 (36:43):
We'll get this question quite as often anymore. I got
it a lot when when mortgage rates were in the
you know, the three percent range, sometimes even two percent,
because people are simply looking at this is the hundreds
of thousands, if not millions of dollars that I've got
sitting here in an asset that's not spitting out any income.
Speaker 2 (36:57):
How can I take.
Speaker 6 (36:58):
Advantage of that? Well, really, the only way to advantage
of it is to is to somehow you know, borrow
against it to pull the money out, unless you're going
to airbnb one of your rooms in your house and
have awkward meetings in the hallway with strangers. There's not
really a good efficient way to get money out right now.
If you're going to borrow against your home, you're going
to be paying about six percent in a home equity line.
I don't think that that that's.
Speaker 2 (37:18):
The worst thing.
Speaker 6 (37:19):
If you actually have a need, that that can be
a pretty good way to finance a significant uh, you know,
an expense you have. Maybe it's a better deal than
you can get from the car dealer or buy a car,
or maybe you need you know you're gonna use it
for college expenses, something like that.
Speaker 2 (37:32):
But simply to.
Speaker 6 (37:33):
Pull money out and and use it to make an
investment that you hope is going to earn more than
six percent, I don't think that's worth it right now.
So I would focus on am I happy in my home?
Is this the place that I want to be? If not,
then let's think about some kind of different arrangement. But otherwise,
don't treat it as a piggybank.
Speaker 2 (37:50):
All right.
Speaker 4 (37:51):
If you're paying seven hundred dollars or more for a
premium credit card, rising fees might force you to choose
which one of those cards is actually worth keeping. Will
help you evaluate your options. Next, you're listening to Simply Money,
presented by all Worth Financial on fifty five KRC the
talk station, Mark Levin.
Speaker 10 (38:10):
We Americans, we patriots are irrational people. Irreasonable people, the
people who know good from either right from wrong. We
also know hustlers and Marxists and fascists in Islamis who
endanger our country every damn day. We're destroying our culture
into civil society, who are breeding a youth that hates
America and embraces the wrong thing.
Speaker 1 (38:29):
Mark Levin tonight at ten oh six on fifty five KRZ,
the talk station.
Speaker 8 (38:35):
The reliable information and of course not just one sided.
Speaker 2 (38:39):
Views, news that affects you.
Speaker 1 (38:40):
At the top end to bottom of the hour, fifty
five KRZ the talk station.
Speaker 4 (38:50):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponseller along with Brian James. Many people have
these high end credit cards, riding the perks and weaving
between the value among the different cards. But now with
these issuers starting to, you know, increase annual fees, the
question is shifting from should I get a premium card
(39:13):
to which premium card I should keep? Brian in all
honesty for questions like this one, you know I come
to you for this stuff, because I know you study
this stuff and know a lot about it. I'm I'm
very eager to hear what you have to say on
this topic, and I mean that in all honesty.
Speaker 6 (39:29):
Yeah, my family has gotten a lot out of the
credit card reward game. We had a credit card over
twenty years that was paying money into a five twenty
nine plan and I'm now very happily on the back
end of that pulling dollars out for tuition. It was
free money and it was one of the smartest things
I've ever done. So why are their higher fees in
these cards? Well, the credit card issuers, Remember these aren't
the banks. There are two entities behind your credit card.
(39:50):
It's the credit card issuer, that's Visa MasterCard. They're the
ones who want the spending because they're taking a haircut
off of every little transaction. Every time you wipe that
you swipe that card, they get two or three percent,
sometimes even four. And they know that typical premium card user,
if you've already got a fee on your card, then
that's got it. Then that's a premium card out there.
They know these people are high spenders. Pay off the
balance every month. And is a low credit risk. Those
(40:11):
are the customers the issuers want. The banks behind it
want somebody who's going to let it go and ignore
it so they can charge them the ridiculous interest rates
twenty five twenty eight percent. So what they're hoping is
that fewer card holders overall, but those stickier relationships and
more interchange spend focused on that one card that they
think is the best one to use. That's what I did,
like I said, for for a long time. So how
(40:32):
do you think about this, run a break even analysis.
If you've got two or more of these premium cards,
make a spreadsheet, figure out your real usage. You know,
are you really using those lounge visits and the hotel
airline credits? Are the lounges open? I have one of
these cards in about half the time there just isn't
room they'll let you in the time that you've got
to lay over. Make sure you're actually getting the value
out of these different perks. Are you using the free
(40:53):
thing that they give you?
Speaker 3 (40:54):
You know?
Speaker 6 (40:55):
So sometimes both cards will cover lounge access or global
entry TSA pre check. Got that twice, you really only
need it once, So one of them is redundant. And
that has no value for you. But at the same time,
if you decide you're gonna cancel one of them, first off,
be super careful. Don't cancel you low your oldest credit card,
hang onto that one unless it's an enormous fee. You're
gonna want that twenty twenty five years where because that's
(41:16):
what's giving you a lot of your credit score. But
if you are going to cancel one, ask for retention.
They might throw you a better deal, some kind of
hidden perk or something that they only hold back when
somebody wants to or offer out when somebody wants to cancel.
But again, the whole point of this is just be
aware what are you using. A lot of cardholders just
never redeem these credits or they just don't use all
the benefits. Some of the perks are just too hard
(41:38):
to use, so they look great in the brochure, but
you never actually use them. So just understand what it
offers you and whether you value that.
Speaker 2 (41:45):
Great stuff.
Speaker 4 (41:45):
Brian, And this is why I'm so blessed to have
you around to give me advice on stuff like this,
because I honestly I never look at it at all,
but good stuff, all right, Thanks for listening. You've been
listening to Simply Money, presented by all Worth Financial on
fifty five KRC, the talk station.
Speaker 9 (42:01):
In order to live your dream doesn't always involve a
pay cut invest your time. Sometimes it involves a pay
cut to get moving and then move.
Speaker 2 (42:09):
Up and invest in your future.
Speaker 9 (42:11):
But I would want a path to make more than
I made, not less than I made.
Speaker 2 (42:14):
Dave Ramsey.
Speaker 9 (42:15):
There's a lot of people need help in this world.
Speaker 2 (42:17):
I want you to get clear.
Speaker 9 (42:18):
I want you to spend some time very carefully going
through what are your talents, what are your passions or
your skills? You know, what is it you value?
Speaker 1 (42:27):
Weekdays at seven by fifty five KRZ the talk station
all Right.
Speaker 2 (42:32):
Holiday time
Simply Money News
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Ruthie's Table 4
For more than 30 years The River Cafe in London, has been the home-from-home of artists, architects, designers, actors, collectors, writers, activists, and politicians. Michael Caine, Glenn Close, JJ Abrams, Steve McQueen, Victoria and David Beckham, and Lily Allen, are just some of the people who love to call The River Cafe home. On River Cafe Table 4, Rogers sits down with her customers—who have become friends—to talk about food memories. Table 4 explores how food impacts every aspect of our lives. “Foods is politics, food is cultural, food is how you express love, food is about your heritage, it defines who you and who you want to be,” says Rogers. Each week, Rogers invites her guest to reminisce about family suppers and first dates, what they cook, how they eat when performing, the restaurants they choose, and what food they seek when they need comfort. And to punctuate each episode of Table 4, guests such as Ralph Fiennes, Emily Blunt, and Alfonso Cuarón, read their favourite recipe from one of the best-selling River Cafe cookbooks. Table 4 itself, is situated near The River Cafe’s open kitchen, close to the bright pink wood-fired oven and next to the glossy yellow pass, where Ruthie oversees the restaurant. You are invited to take a seat at this intimate table and join the conversation. For more information, recipes, and ingredients, go to https://shoptherivercafe.co.uk/ Web: https://rivercafe.co.uk/ Instagram: www.instagram.com/therivercafelondon/ Facebook: https://en-gb.facebook.com/therivercafelondon/ For more podcasts from iHeartRadio, visit the iheartradio app, apple podcasts, or wherever you listen to your favorite shows. Learn more about your ad-choices at https://www.iheartpodcastnetwork.com
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com