What’s the best way to save for a house without wrecking your retirement plan? That’s just one of the big questions Joe Saul-Sehy, OG, and Mom’s neighbor Doug tackle in this packed episode (number 1700!) of Stacking Benjamins. Whether you’re trying to figure out where to park your emergency fund, how to handle inherited IRAs, or how to financially plan as a single adult with big responsibilities (hello, aging parents!), this episode is full of relatable scenarios and actionable strategies.
Stackers Torin, VJ, Lori, and Michelle ask everything from:
- How much is too much in your emergency fund?
- What happens to inherited IRAs when you’re already juggling financial priorities?
- What should single people be doing right now to prepare for the future?
- How do you juggle helping aging parents while keeping your own goals on track?
Plus, we mix in commentary from Kevin at Edward Jones and longtime listener Ron—offering insights from inside the financial services world and the Stacker community. The guys debate personal finance media narratives, give practical advice for budgeting large windfalls, and reflect on why saving feels easier in theory than in practice.
Also covered in this episode:
- Why financial advice often skips over single individuals—and what to do about it
- Emergency fund strategies: where to park the money, how much to keep, and how to make peace with the fact it isn’t earning sky-high returns
- How to prioritize debt, student loans, savings, and investing without setting off a financial anxiety spiral
- The value of short-term tradeoffs when you’ve got long-term goals
All delivered with the basement’s signature charm—where the coffee is lukewarm, the guidance is practical, and the jokes… well, let’s just say they’re dividend-eligible.
This episode is a perfect listen for:
- New Stackers building their financial foundation
- DIYers trying to juggle competing money goals
- Anyone who’s inherited assets and doesn’t want to mess it up
- People who’ve realized adulting is basically managing 14 financial priorities at once and still remembering to bring snacks
Deeper dives with curated links, topics, and discussions are in our newsletter, The 201, available at https://www.stackingbenjamins.com/201
Enjoy!
Doug’s Trivia
- Which solo song by Michael Jackson does Billboard call his best?
Have a question for the show?
Want more than just the show notes? How about our newsletter with STACKS of related, deeper links?
- Check out The 201, our email that comes with every Monday and Wednesday episode, PLUS a list of more than 19 of the top money lessons Joe’s learned over his own life about money. From credit to cash reserves, and insurance to investing, we’ll tackle all of these. Head to StackingBenjamins.com/the201 to sign up (it’s free and we will never give away your email to others).
Join Us Friday!
Tune in on Friday when we’re talking about lies that financial “gurus” tell us.
Written by: Kevin Bailey
Miss our last show? Listen here: AI’s Coming for Your Job? How to Outwit the Robots (SB1699)
Episode transcript
[00:00:00] opening bit: We are back. We are back. We are getting Doug back, and we’re the three best friends that anybody could have. We are the three best friends that anyone could have. We are the three best friends that anyone could have, and we’ll never, ever, ever, ever, ever leave each other. We’re the. [00:00:27] Doug: Live from Joe’s mom’s basement. It’s the Stacking Benjamin Show. [00:00:41] Doug: I’m Joe’s mom’s neighbor, Doug. And earlier today we realized we’ve got stacks of mail sitting around here. So today our Special Wednesday guest is you. We’ll answer questions from stacker Torin about saving for a house and VJ about emergency funds stacker. Lori from Wisconsin asks us about inherited IRAs, and Michelle wonders about specifics. [00:01:04] Doug: Single people should know about financial planning. But you think we’re stopping there? Nah, nah. We also made room for comments from stacker Kevin, who wants to clarify the situation at Edward Jones that was in the media and stacker Ron, who has thoughts about the student loan crisis. And don’t you worry yourself even a little bit because even after all that goodness, I’m still gonna top it off with some of my incredible trivia. [00:01:31] Doug: And now two guys who love our stackers, so. So much. They almost took out a second mortgage to buy everyone coffee. Almost almost. It’s Joe and oh, ju ju ju. [00:01:49] Joe: You know what happened, Doug? We’re like, we’re not made of money. We can’t buy two cups of coffee. Like are you, are you kidding me? For both listeners. Hey, everybody. Happy. Happy [00:01:59] Doug: Wednesday. I get, I get what you [00:02:00] Joe: did there. Yeah. How about that? Welcome back, everybody. Sit back. Relax. You found us. It’s gonna be a super, super fun episode because we are taking your questions today. [00:02:11] Joe: Got a little behind Doug in the mailbag. Got a i I got took our eye off [00:02:15] Doug: the ball. Yes. Sorry about that guys. Bringing on all these awesome guests. Ugh. Researching all kinds of stuff. Whoops. Look at all [00:02:22] Joe: those fans talking about retirement and, and international investing. But you know what? Today we’re gonna do a little potpourri because your questions are delightfully all over the place. [00:02:33] Joe: And a guy, whenever I think delightful, I think of him across the car table. Mr. Ji is here. How are you buddy? [00:02:39] OG: Do you guys have the, um, or is it not in style anymore to have the actual, the potpourri? The crunchy, you know what I’m talking about? Like the crunchy flower things? Snack bowls. [00:02:49] Joe: I don’t see ’em anymore. [00:02:50] OG: Yeah, I don’t see ‘ [00:02:50] Joe: em. [00:02:50] OG: I [00:02:51] Joe: don’t see them in places. No. [00:02:52] OG: I just had like the glade plugins or something. [00:02:54] Joe: Yeah, [00:02:55] OG: faze spray. [00:02:56] Joe: We gotta go back to that. I thought you were gonna talk about those little sticks that you had when you were in college. That, you know, the Petly incense sticks. The little incense sticks. No, I didn’t. [00:03:07] Joe: Yes, that were That were nice. I actually saw those in a store a couple weeks ago. That was a thing in the [00:03:11] OG: seventies, maybe when you guys were in college. But [00:03:14] Joe: easy, easy. We got a great show. Today we’re gonna talk about so many things. Doug, you mentioned a bunch of them, emergency funds. Inheritances. Mm-hmm. [00:03:25] Joe: We’re gonna talk about nefarious in the brokerage community, student loans, financial planning for single people. Just so, so, so many great questions you guys brought to us. If you’ve got a question, you know what? The mailbag now, we’re gonna move a lot toward emptying it today. This is deck Benjamins dot com slash voicemail. [00:03:43] Joe: We’re going to [00:03:43] OG: impact zero. [00:03:44] Joe: Yeah, we’re not there yet, but we are closing in, so ask your question and hopefully later on this summer or early in the fall, we’ll be able to answer your question. But first, before we hear from all the goodness you stackers have brought our way, we’ve got a couple of sponsors who make sure that this is free and you don’t have to pay for any of this. [00:04:04] Joe: Goodness. We’re gonna hear from them, and then we’re into the mailbag with your, your questions. [00:04:13] Letters: We just got a letter. We just got a letter. We just got a letter. Wonder who it’s. [00:04:20] Joe: Alright guys, let’s not dilly Dally. Let’s begin this shindig with a great question from Torin. Hey Torin. [00:04:29] caller: Hey Joe. Oji question about saving for a house. So in three years I may have to buy a new house. I would like to keep the one that I currently own and rent that out. [00:04:38] caller: So selling is not an ideal option while I save for that house. Since it’s possible, it’s in the more short term. Does it make sense to. Put that money in a more conservative investment, like a high yield savings account, or is it better to do a more aggressive approach with investing in the stock market since I may not need that money in three years after all? [00:05:00] caller: Or is there a hybrid approach where I should put some portion of the money in a more conservative investment and a portion of that money in a more aggressive investment? Appreciate your help, [00:05:10] Joe: Torin. Thank you. Thank you. Thank you so much for the question. Og, maybe a house in three years, but it sounds like that timeline might be flexible. [00:05:19] Joe: Does he invest the money or just go high yield savings? [00:05:22] OG: Oof. Well, he got me with the maybe, and that’s really the most important piece. I think the way that I would look at this is, I would say, what happens if you need it in three years and the market’s down 20%? Are you in a position three years to go, well, I’ll just rent for a year and wait it out. [00:05:40] OG: Or does that radically change your new house approach down the line? Does that mean that you can’t get one? Does that mean you can’t take the new job? Does that mean that you, you have to sell the house that you don’t wanna sell? What are the dominoes that fall? If the market doesn’t behave in the manner in which you hope it behaves? [00:05:58] OG: And if you can’t absorb it all, then you have to go cash or something like cash. If it’s like, well, it could be three, but if I get there and it’s not, I’m not ready, I’m happy with renting for a year and let the market do its thing. Or it might be three, it might be five. It could be never, but you never know. [00:06:17] OG: I’m much more open to investing it because of the unknown, but just you, you gotta be okay with what happens if you saved a hundred grand and all of a sudden you got 80, what do you do? [00:06:27] Joe: Yeah. I like the way you turn that upside down, what most people think. Because most people start off with what’s optimal and optimal, as we talked about on Monday, is so much in the eye of the beholder. [00:06:38] Joe: Yeah. And it’s got, there’s so many factors. I definitely love your way of thinking, which is, which one would disappoint you the most? ’cause we want to avoid that one. And clearly if you get to three years and it’s down 20%, you go, yeah, I can’t do that. ’cause you know, I, I may seriously have to move. I can’t wait. [00:06:54] Joe: Well then you just answer your question. Yeah. What would disappoint you the most? I think is. Speaking of optimal, a much more optimal way to answer questions than which one is the best case scenario. Look at avoiding the worst case scenario. [00:07:07] OG: What are the behavioral economists say that losing feels twice as bad as winning feels good. [00:07:13] Joe: Yeah. [00:07:14] OG: Statistically, or however you wanna say that, you know, emotionally. So, yeah, I don’t even think about it like, ’cause I’d still be disappointed if I was down 20% and I didn’t need the money. But what are the changes that have to happen because of it? If you can absorb it and you go, well, in a perfect world, I’m buying a 500,000 house, I’m gonna put a hundred thousand down. [00:07:31] OG: But if I get there and I only can put 80 down, eh, whatever, I don’t care. Like yeah, it’s a little bit bigger mortgage payment, I’m fine with it. I might have to pay PMII don’t care. I’m fine. You know, if you’re good with all that, then full send, man. But if it’s like, no, no, I, I absolutely need to have a hundred grand. [00:07:47] OG: And if I have 99.5, I am toast. There’s no way I can afford it. There’s no way I can get this done. I can’t take the job. I can’t move across the country, you know, like whatever. I have to sell the house. I don’t wanna sell catastrophe then. Then yeah, you have to pick cash. [00:08:02] Joe: There’s also decrees then of investing og, because if he’s not looking at three years, I. [00:08:07] Joe: Then the next obvious question is, is, okay, what’s the maximum length you would go? Turns out it’s five or it’s six years. I think that’s different than if he looks at 10, isn’t it? I mean, is this a case when I go from high yield savings to bonds because then I am notching up the potential return, but I’m also keeping that risk in check? [00:08:26] OG: No, and not in my opinion, because the yield curve does not benefit you for lending money longer than shorter. A lot. The difference between lending money to the bank, so if you buy a six month CD or a two year cd, you get an increase in your rate, right? Because you’re locking your money up for two years. [00:08:46] OG: If you do a two year CD versus a five year cd, it’s not the same rate of change as six months to two years was if you go five to 10, it’s darn near flat, so you lock your money up for 10 years. But you don’t get much more return. [00:08:59] Joe: Yeah, but I’m talking like a bond fund where his expectation might be six and a half versus four. [00:09:04] OG: That’s my point. A six year bond pays the same as a two year cd. So why would you add the, the risk of the potential of the fixed income product when you could have a guaranteed product of a CD or, or high yield savings with virtually the same outcome? The other thing that people do with this stuff sometimes is they look at that yield number or return number or something like that, and don’t really factor in return on what it’s like. [00:09:29] OG: It’s like, well, no, no, my, my savings account gets 4.1 and yours only gets 3.9. Mine is so much more superior to yours. And it’s like. We both have 10 grand, so it’s like 20 bucks, [00:09:40] Joe: you know? I mean, how much are we truly talking about real life? What are we talking about here? [00:09:44] OG: You know, it’s like I’ve got $50,000 in this account and I can get 4%, or I can get 5%. [00:09:50] OG: I mean, it’s not zero, but it’s not like life altering, family treat dynamic money. [00:09:57] Joe: Yeah. And I think that, you know, and they call this in the business, the risk premium, right? I think Torin, that’s the first thing that I do, is what OGs talking about right now is I take a look at. How much money in real dollars will investing this actually bring me? [00:10:10] Joe: And is that, is that a game changer? Because if it’s not, then I don’t wanna be disappointed. Back to the original part that we talked about. Yeah. If it, if, you know, investing in the s and p 500 or s and p, maybe large cap value or something like that would be, um, potentially appropriate for this then, and it adds 500 bucks, 400 bucks, versus the downside of I could lose 500 bucks. [00:10:36] OG: Yeah. It is a juice worth to squeeze. Yeah. Yeah. The benefit of compounding at market rates happens in 20 years, not in two. You just don’t, I mean, you just, you just really don’t see it early on. [00:10:45] Joe: Yeah. And I wanted to talk, uh, Torin about one other thing that you said, which I find this interesting, that he doesn’t want to sell the house. [00:10:52] Joe: He wants to use it as a rental. And I think OG for a lot of people that are just experimenting with being a landlord, I think this is a great way to begin that journey. Just dip your toe in a little bit. And I don’t know if torrent’s doing it because he wants to or because he needs to, but I think you can learn a lot of lessons about whether real estate is for you or not in this situation by going with one property. [00:11:14] OG: Yeah. I have a dilemma hearing the words like, I can’t, or I never, or whatever, because it’s like, well, I mean, you could. Just choosing not to, you know, you gotta keep the power to yourself. You gotta be the one in charge of it. When you say, I can’t, you’re putting the, you’re putting the power on somebody else and maybe, maybe he really can’t. [00:11:31] OG: Maybe it’s not his house itself. Yeah. Maybe there’s [00:11:32] Joe: some extenuating circumstances he can’t tell us about, but [00:11:35] OG: yeah. Yeah. So that would be the case. But if really I choose to not sell my house, now you are deciding to do it and having. Like we talked about the other day, there’s a thousand ways to make money. [00:11:45] OG: There’s also a thousand ways to lose it, and I have experimented with being a landlord and I absolutely hated it. So, so best wishes to you and yours, and I hope you are successful because, I mean, we were successful financially, but I hated every flipping second of it. I know you were successful, Joe, with yours too. [00:12:03] OG: Like you made money on yours. You just, I did. You just hated it. But no, thank you. Yeah, you just hated it. I hated every minute of it. Hated every minute [00:12:08] Joe: of it. Wanted nothing to do with it. Uh, we’re gonna have an episode, uh, coming up by the way to in, in August. Paula’s gonna be our friend Paula Pan, afford anything. [00:12:17] Joe: It’s gonna be launching her new course she does every year of my first rental property. So that might be a episode that you’re gonna wanna listen to in the future as Paula does a deeper dive with us on when you own that first rental property, how to go about making that happen and avoid some of the mistakes that policies quite often. [00:12:34] Joe: Yeah. [00:12:35] OG: Maybe if we would’ve got her course, we wouldn’t have sucked so bad at it. That’s [00:12:38] Joe: right. If we, I totally, man, I learned so many things then, and then afterwards, once we really started talking more and more about real estate, I’m like, oh yeah, I messed that. That’s [00:12:48] OG: what you’re supposed to do. [00:12:49] Joe: I messed that up. [00:12:50] Joe: Oh, yeah. CapEx didn’t know what that was. Let’s, let’s say hi to Lori in Wisconsin. How do you pronounce that, Doug? How do you pronounce? Wisconsin? Wisconsin Hanson. There we go, Lori. We’re doing it like the home team. What’s on your mind, Lori? [00:13:06] caller: Hey Joe OG and Doug. This is Lori from Wisconsin. Last year you answered a question for me that I emailed in about my daughter Roll Tide. [00:13:14] caller: You shamed me just enough about the email that today I’m trying a voicemail. So here goes. Could you go over some basics about inherited IRAs? I have a friend who just got a small IRA inheritance from her mom that was split between her and her siblings. I told her about having to empty the account within 10 years, but I’m also curious about how our MDs work when the inheritance is split between beneficiaries. [00:13:37] caller: How does each person know what and how much and when they have to take money out of the account? I know inheritances are a big topic, but I thought maybe you could give us a brief overview, especially about the inherited IRA. Have a great day. [00:13:53] Joe: Awesome. Thank you so much for the question and for stepping up with the voicemail because. [00:13:58] Joe: Guess what’s gonna happen now? Tina from our team is gonna send you a code and for being part of the show. Oh, we pay you in swag. [00:14:06] Doug: I thought you meant what’s gonna happen now is we’re gonna talk about her incredible Wisconsin accent. Delightful. It was so good. I’m not kidding. So good. I loved it. I loved it. [00:14:14] OG: The other thing that I heard was, uh, I’m not even [00:14:15] Doug: making fun of it. A [00:14:16] OG: little bit of a roll tide in there. I know. Yeah. And she squeaked that in there too. Be a former Alabama that threw us. It’s fantastic. I mean, I love Alabama. It was a great way to start 2024 and a great way to end 2024 Michigan, beating Alabama on January 1st and on December 31st. [00:14:34] OG: I mean, it couldn’t have been a better way to kind of bookend the whole year. So thank you. It lori’s on our way [00:14:38] Joe: to Texarkana to thank, [00:14:40] OG: thank you. And, uh, as they say. Roll tide. Let’s keep that roll going. We’re good with this. We like this little thing. Um, inherited IRAs, they’re kind of fun. So a couple of things. [00:14:51] OG: You know, and this is really the nitty gritty stuff of making sure that you do this stuff right, because at the end of the day, the IRS doesn’t really care that you didn’t know. If you say, well, I didn’t know that I was supposed to, [00:15:03] Doug: well, [00:15:04] OG: tough patties. Here’s your penalty. Not our fault that you didn’t figure this out. [00:15:09] OG: A couple things to remember. The first thing that you have to think about is was the person who you inherited the IRA from, were they already receiving RMDs? So were they over the age of 73 that sends you down one path? If they were not, that puts you on a different path. If they are already receiving RMDs, then you have to follow a different schedule. [00:15:32] OG: And again, this is something you can do on your own. You can use some AI tools if you wanna double check your math. If you wanna hire a CPA or a financial planner, this is a really good use for that. But a lot of this is d iy able. If you get yourself a head start, you have to, like you said, take the money out within the 10 years and you have to take out a certain amount every year. [00:15:54] OG: So there’s a schedule that the IRS produces based on your age, and then you run the balances. It’s a December 31 balance times this number, well, it’s actually divided by this number, and then that tells you how much you have to take out. Companies like Fidelity, Schwab, whatever, they won’t tell you what these numbers are. [00:16:11] OG: You have to do this yourself. [00:16:13] Joe: But the good news is it isn’t hard and it accelerates it a little bit. ’cause what they’re trying to do is look at a percentage of the assets that you’re taking out every year. So it may feel like it’s accelerating a little bit over that 10 year period. [00:16:26] OG: Well, and for a person that’s inheriting the IRA, let’s make some general assumptions here. [00:16:31] OG: Let’s assume that mom was 70, got hit by the bus, and the kid that got the money’s 45. It’s all based on life expectancy. So the life expectancy of a 45-year-old is a pretty long time. So it’s a really small amount that comes out, you know, in year one and in year two. And then the balance has to come out in year 10, or it has to be all done by year 10. [00:16:51] OG: So there’s a minimum amount the required minimum distribution, RMD. There’s no rule that says that you have to only do that. You can do any amount, [00:17:01] Joe: which goes to why planning on this, I think is so important, og, especially if it’s a big number. [00:17:06] OG: Well, and yes. So if you get to a situation where it’s like, mom had $3 million, I. [00:17:11] OG: And I’m 45 and it’s in an IRA and I gotta take out this little teeny, tiny bit. Oh, okay. You know, it’s like a little bonus, like 50 grand, like, woo-hoo. I made 50 grand. Not recognizing that that 3 million turned into 3.3 because it grew by 10% a bam, and then 10 years from now, the three’s gonna turn to six if you invest it correctly. [00:17:27] OG: I. And, uh, in 10 years from now, you’re taking 6 million out that year. [00:17:32] Joe: So much money lost to the IRS and [00:17:33] OG: now it’s 50% to taxes. So yeah, it does take some planning if it’s a big number, if it’s a small number. Back to our conversation with the first question about juice worth the squeeze. Let’s say that the balance of the IRA is 30 grand. [00:17:46] OG: Do we really need to be dragging this out over the next 10 years? 10 years of tax filings, 10 years of paperwork, 10 years of separate accounts? 10 years of making sure that you do it the right way, otherwise there’s a big penalty. Or can we just pay the piper and move on with life? You know? And I think there’s a balancing act there. [00:18:04] OG: You gotta decide what their threshold is. Is it 30 grand? Is it 300? I don’t know. But somewhere in there you gotta think like. Is it worth taking $200 a year out of this thing and all the stuff that goes into it? You know what I mean? Because that’s what it would be. [00:18:19] Joe: Sure. Your time is not worth that. I mean, you’re like, come on to gimme an [00:18:22] OG: idea. [00:18:22] OG: Just for people that haven’t ever looked at this, the RMD for a 73-year-old is 3% of the account value the first year, and so back that down to a 40-year-old, it’s gonna be 1%. You know, it’s a really small number. It accelerates, like you said, it gets, it’s a higher percentage every year because your life expectancy is decreasing, but. [00:18:42] OG: But yeah, if it’s a small number, it might make sense just to kind of pay the piper, be done with it if there’s multiple people. Our other question was how do you deal with this with multiple people? [00:18:49] Joe: Well, before we get there, og, just one more thing there, Lori. When you’re doing your planning. One thing you’re gonna wanna look at, uh, while you’re doing that planning, is what tax bracket am I in and how far away am I from that threshold? [00:19:02] Joe: So part of that planning’s gonna be, I’m gonna take out X amount up to the next tax bracket this year. Sure. So I’m not paying any more tax. And listen, if I’m a long way from the tax bracket below me, and I don’t expect over the next 10 years that I’m gonna get there, I’m just gonna fill up the tax bracket every year as much as I can so that I minimize that tax in year 10 if it’s a big number and. [00:19:23] Joe: Yeah. To OGs point, if it’s small, I would still check the tax bracket to see if you wanna split it maybe between two years. Sure. If you’re gonna pay a little bit more tax, but if not, then go ahead and take it all out in one year and get it done with. [00:19:36] OG: Yeah. I mean, there’s some power of tax deferral and people would say that and that sort of thing, but you gotta weigh all that out with Yeah, with your time and the cost of the CPA and you know, paperwork and all that sort of jazz. [00:19:47] OG: So when there’s multiple people as beneficiaries, each person has their own account. Joe’s got an inherited IRA, Josh got an inherited IRA. Doug’s got an inherited IRA all from mom. We all are different ages. Some of us are profoundly younger than others, so we’re gonna have a much smaller RMD. God, they didn’t, neither of them looked up from that. [00:20:05] OG: I thought for sure I was gonna zing them with the old guy. Joking they didn’t get it, but, um, weren’t following along. That’s fine. We’re [00:20:11] Joe: just too old. It just went right over our head. [00:20:13] OG: It just went right over your head. Couldn’t [00:20:14] Joe: hear you. You’re talking to me, [00:20:17] OG: I gotta turn up my hearing aids. But anyways, each person has their own schedule that they gotta follow and their own tax responsibility to do it. [00:20:24] OG: When you split it up, when you know if you, the money’s at Fidelity and you say, Hey, by the way, mom died and here’s all the beneficiary information, and they split it up. Each beneficiary has their own account. Each beneficiary has their own person, you know, assuming that they’re an adult anyway. You know, off they go. [00:20:39] OG: They gotta do their own thing. So the other people are not impacted by other people’s decisions, so to speak. Yeah. I think she said something like, my friend inherited the small IRA small and inherited IRA. Small is relative. It all is, like you said, based on tax brackets and that sort of thing. But when I see this, I see the juice worth the squeeze thing and I go, do we really wanna be taking 400 bucks a year out for the next 10 years when we can just take 50 grand out right now? [00:21:08] OG: And. Put it in our brokerage account and let it grow, do its thing, you know? Anyway. Sorry about your friend’s parents passing. Yeah, that sucks. Yeah. Or a family member, I guess you can say it was parent, but uh, just [00:21:17] Joe: a couple things I’ve seen from people. And for some people this may be obvious. For some it isn’t. [00:21:22] Joe: If it’s a spouse, it’s a whole different set of rules. So this is for non spouse? Yeah. There’s no rules [00:21:27] OG: for spouses. Yeah. I mean, if you’re a spouse then, then the account turns into yours and there’s some limited circumstances where you wouldn’t wanna have that happen. But the vast majority of the time you want it to be considered your own. [00:21:40] Joe: The second question we sometimes get is, Ooh, I don’t have an IRA of my own. Can I just add to this one versus opening? Nope. This is gonna be a different game that you’re playing, so you cannot add to an inherited IRA. Yep. Great question. Lori. Thank you so much for hanging out with us and also for the voicemail. [00:21:56] Joe: Yep. Yeah. Great job on the voicemail. Great job. It’s a great job. [00:22:01] Doug: Go talk to your mom [00:22:02] Joe: who’s, who’s the comedian? We love that. Does that Doug, the Midwest comedian, uh, Charlie Barons. So good. He is hilarious. I love that guy. So, so, so good about the Midwest. Nice. No. Hey, I mowed your lawn. Hey, I res shingled your house. [00:22:16] Joe: Hey, hey, I took your wife off to dinner. What? Wait, what? Be helping each other. Next up we have Kevin, Kevin heard our episode where we’re talking about the, uh, at the time downturn in the market with the tariffs and some of the companies and how they responded. We, uh, profiled a piece that came from investment news. [00:22:39] Joe: Which detailed how Edward Jones had responded to the downturn in the stock market with some guaranteed products, where we thought that maybe they guaranteed that you’d cap your upside and really some, some sketchy stuff. Well, Kevin wanted to comment on that. [00:22:57] caller: I was listening to your episode from, I believe May 14th. [00:23:02] caller: Uh, I actually work for Edward Jones. I’m not in the exec team or anything like that, but I think you guys could do a little more research on the article you guys had. Um, those alternative investments are only available to a very few specific clients. There’s nothing Edward Jones has done to abandon our, [00:23:26] caller: the stock market. [00:23:30] caller: That, uh, there’s definitely more to it than that. Do a little more research. Figure out what details you’re actually putting out there before, you know, going through and. More than happy to talk further about it. Lemme know. Thank you [00:23:46] Joe: Kevin. Thanks for hanging out with us and thanks for for the message. Our headline segment is what comes out from the news and from your PR department? [00:23:58] Joe: I’ll say this. Well, I. I love you calling us and calling into us and telling us that, you know, maybe that all wasn’t right. We’re not the Edward Jones PR department. We’re not the people that put this out into the media stream. Our job is to look at the things that are reported on and go, do we agree with this or not? [00:24:17] Joe: This was a piece that was reported on by very responsible people and, uh, your PR department talked about it. So I think instead of calling me. I think the better people to call would be your PR department. Say, listen, you’re screwing me over with all these people and, and you’re making us look bad. That is not my job. [00:24:39] Joe: My job is responsibility to make sure that I’m finding responsible sources, which I did, and to make sure that we give a take about how this might be bad, which we did. I love the enthusiasm. I love the fact that you didn’t like that headline. I wouldn’t like it either. If somebody was talking about my company and I knew there was more to the story, but listen, Edward Jones has a massive PR department. [00:25:04] Joe: I know that because I used to work in the PR department for American Express. They are massive. And the fact that if this was wrong, that it got out into responsible media, that your exec team was letting crappy products like this go, but it wasn’t the full story. I don’t think that’s on me. That is not on me. [00:25:25] Joe: That is definitely, I’m with the Edward Jones PR team and really og. That is frustrating. You know when you work for a company and then you see a headline about your company, I mean, how many, you know, back in the day when we worked with American Express, you’d see a headline about that, or about Ameriprise or about any of the companies that we work for. [00:25:43] Joe: And you go, oh man, there, this story is so much deeper than this. [00:25:47] OG: I think when you look at the space of investment products, the whole idea for different types of products always starts at the higher level. I mean, we’re seeing this with the 401k article we had two weeks ago, right? Where it was like, Hey, you get to do leverage in your four oh k, or you get to buy. [00:26:06] OG: Private equity in your 401k from earlier this quarter. You know, when we talk about that, that didn’t start at the mainstream investor level, right? That started with Oh, no, no. That’s just for, that’s just for the people that have 10 million. That’s just for them, and then it just trickles down. Right? It’s, it’s no different than what happens in the NBA. [00:26:23] OG: All of a sudden the college players do, and then the college players do it, and the high school players do it. You know what I mean? It’s like. It’s like attracts like, think [00:26:29] Joe: about our headlines the last several weeks, OG, about these private equity products that now are starting to seep into our 4 0 1 Ks. [00:26:36] Joe: Right? [00:26:37] OG: That’s exactly literally what I said. You, you did not hear a word I like. Did you look at those? [00:26:44] Doug: Look at those as well. They just really want you to look at ’em. [00:26:47] OG: Also, look at the thing that you just said five seconds before I said it. [00:26:52] Joe: Yeah, but I know that, but this too, which might be the same thing. [00:26:56] OG: Well, I appreciate Kevin’s perspective of like, hey, this was, this is an isolated thing, or this is really only for the It’s, yeah, it probably was, and to your point, Joe, you know, hey, if they didn’t want people to. Know about it. They shouldn’t have, they shouldn’t have released it in the news. But these types of products, and it’s maybe not a slight at Edward Jones, although, you know, we think it’s really silly that they have this stuff. [00:27:18] OG: Well, I think it’s silly that any company has it, frankly. So it’s not them, it’s everybody. But you’re right, it doesn’t affect the mom and pop customer that you have right now. Right now it doesn’t, but it’s coming. And to your point, Joe, I think it is our responsibility to say. Hey, this is a product that’s out there. [00:27:35] OG: Yeah. It only affects people that have 10 million bucks right now. But pay attention ’cause this is coming your way. We like Vanguard, [00:27:43] Joe: we [00:27:43] OG: like [00:27:43] Joe: Fidelity. We’ve talked about craziness [00:27:46] OG: happening. We’re just not in love [00:27:47] Joe: with [00:27:47] OG: them. [00:27:49] Joe: We talked about crazy stuff that they’ve done. That is our role in the machine. We don’t like ’em more than a friend. [00:27:59] Joe: And Kevin, by the way, if, if as an industry insider, I mean, if you’ve got a greater take on any of this stuff and wanna give our stackers some insight to it, certainly call back. [00:28:08] caller: Yeah. [00:28:09] Joe: I mean, don’t stop calling back. But I do wanna draw a line between what is my job and what’s your pr My, my job is not that we’re Jones PR department. [00:28:16] Joe: I just wanna be very clear, I’m not Fidelity’s PR department. I’m not Vanguard’s PR department. Not even involved American Express’s PR department anymore. If it appears in Responsible media and your CEO comments in the piece, then that’s fair game for the Stacking Benjamin show, frankly. And I think for anybody else, uh. [00:28:37] Joe: I [00:28:37] OG: love it. And to be clear, we, we don’t just think EJ is screwing the pooch here. We’ll also take shots at LPL and Sure. Schwab and Fidelity and Vanguard and all these people who do this, [00:28:47] Doug: but good on him for calling us, you know? That’s right. Calling us out on it and, uh, standing up for his own firm. Yeah. [00:28:53] Joe: I love having this discussion too about how the sausage gets made. [00:28:56] Joe: Alright, in the second half we’ve got questions from Michelle. Michelle earlier had written us about what advice do we have for single people. She wanted to put that in a voicemail. We get a great question from her. We get a fantastic question again about emergency funds and what kind of distinguishing between high yield savings accounts and some other choices for that. [00:29:16] Joe: We’ll get OGs professional take on that and then a comment from Ron. Who we’ve been talking a lot about lately about the student loan crisis, and Ron has a take that he’d like to share as well. That’s coming up in the second half of this amazing EE episode. But Doug, speaking of amazing, it’s an uh, kind of an amazingly sad day upstairs ’cause mom’s got all the curtains drawn. [00:29:37] Joe: She is not in a great mood. [00:29:39] Doug: It’s dark. You’re right. Hey there stackers. I’m Joe’s mom’s neighbor, Doug, and it is a tough day in the basement. Joe’s mom is like Joe said, candles all over the house. Curtains are drawn. ’cause today is the anniversary of Michael Jackson’s death. Back on June 25th, 2009. Jackson was of course one of the top artists of all time and it would take us hours to list all of his accomplishment. [00:30:01] Doug: But here’s, here’s two. Uh, he was a Grammy winning artist, like multiple. He probably won like a hundred Grammys, I think, and his thriller album sold an incredible 38 million copies in 1984 alone, and it’s still the best selling solo album of all time. That’s incredible. All these years later, it really is. [00:30:21] Doug: Here’s today’s question. While a song he performed with Paul McCartney called, say, say, say, is listed by billboard as Jackson’s number one song ever. Which Jackson Solo hit? Did they rank as number two, or in other words, his best hit as a solo artist? I’ll be back right after I go tell those kids on the corner to beat it. [00:30:41] Doug: I mean, just beat it kids. [00:30:50] Doug: Hey there stackers. I’m backward walker and Guy who loves Pepsi, but you know, not enough to get burned by it. Joe’s mom’s neighbor, Doug Jackson’s death truly was a tragedy and his doctor served two years in prison for involuntary manslaughter. But even with a life cut short, Jackson still reigns supreme as the king of pop music. [00:31:10] Doug: So which solo song does Billboard call his best? That would be a little Diddy that spent 24 weeks on the billboard chart and seven of those at number one. It was none other than Billie Jean. And now back to two guys who aren’t my lovers. I think everybody figured that one out. They’re just, some dudes I know aren’t the one, Joe and og, [00:31:38] Joe: but the kid is not mine. I, oh man, Billy Jean. There’s a, uh, the Civil Wars, you know, the band dug the Civil Wars. I don’t. They’re a country folky band. They do this wild. Oh, you love that [00:31:52] Doug: sound? [00:31:53] Joe: Yeah. And they do this wild, uh, remake of Billy Jean in that kind of country, folk. Yeah. Uh, [00:31:58] Doug: yeah, you know what? I don’t know if that’s just kind of the in thing to do in that genre, but I’ve been getting a lot of that pop up either in my. [00:32:05] Doug: Like the made for me playlist, or in my reels, I’ve been seeing a bunch of covers by people with floral dresses and banjos and kind of that whole Americana country theme. So I, I mean, write your own material. [00:32:20] Joe: There’s a banjo band that’s known for covers and they’ve done a Seven Nation Army. Mm. But they have one album that is completely, it’s all ac, CD, C covers. [00:32:30] Joe: And it’s so funny with the banjo, she was a fast machine. She kept a motor clean. Bam. Woman. It’s so fun. It’s so, how does it go? [00:32:40] caller: How does it go again? [00:32:41] Joe: Yeah, yeah. Keep going, Joe. Ruin your reputation all in one fell swoop by singing. You don’t have a musical reputation. Joe, I’m not sure you’ve got much to ruin. [00:32:51] Joe: I probably do. I might as well go ahead just burn whatever torture correct foundation I have to the ground. Yes. Instead of doing that, let’s hear Michelle, please, Michelle, save this. [00:33:03] caller: Hey, Joe OG and Doug. This is Michelle. You recently read my email on the back porch with a couple topic suggestions. In an effort to appease Doug and his concern about the state of my wardrobe, I’m calling about one of the topics I mentioned. [00:33:17] caller: So here’s the question. Is there anything different a single person should consider in financial planning? A little about me. I’m in my mid thirties, currently single with no kids. I have an awesome, though, sometimes expensive dog. I also have an amazing nephew and a niece on the way. My 401k is valued around 270,000 and about 30% are Roth contributions. [00:33:39] caller: I max out my HSA each year, and it is valued around 10,000. My only debt is my mortgage. Most likely I will need to replace my car in the next one to three years. Right now I’m focused on increasing my cash reserve for a future card down payment, home improvement projects, and six to 12 months of living expenses. [00:33:59] caller: My parents recently retired from their corporate jobs and their investments are expected to cover all their needs. Most likely I will be the one to provide any future care needs my parents have and I currently live one and a half hours from them. I also have longevity on both sides of my family. Any advice is greatly appreciated. [00:34:17] caller: Thanks. [00:34:18] Doug: Hey Michelle, is that enough details for you? Og? Holy cow. She’s about, that’s fantastic. A blood, I mean that I think [00:34:24] Joe: I love that. I mean, now we can kind of dig into the financial plan like that is fantastic stuff. Michelle, thanks so much for calling and uh, what a great topic. Og. I have a few things, but not much because she’s single, but there’s a lot going on here. [00:34:40] OG: A couple of things that I thought about were around protection planning, and it’s interesting that she said that she would be expected to provide assistance, like healthcare assistance to folks if they have enough money, and I would wonder why. I mean, not withstanding the fact that you, maybe you want to do that, or maybe that’s your current profession. [00:35:01] OG: You know, you’re a nurse or whatever, and you have that expertise. But if they have enough money, like why would you want to have to do that? I think that sounds more glamorous than it actually ends up becoming. But what do you mean by glamorous? Like she’s worried about it, but it’s not gonna be a big deal. [00:35:15] OG: No, the other way around I think. I think you look at it and go, oh no, I would love to help mom if she was sick and I could take care of her. I see. Until you realize like, that could be a 12 year process of 24 7 care. [00:35:25] caller: Yeah. [00:35:25] OG: Yeah. That’s not as. Good as you think. [00:35:28] caller: It would be tougher. [00:35:29] OG: Yeah. So I would, I would rethink that with your folks, honestly. [00:35:32] OG: But that also kind of dovetails into how you think about it for yourself, because if that’s the expectation that your parents have for you, who is the person that’s gonna do that for you? Then assuming that you have the same life expectancy in the same, she [00:35:44] Doug: said she has an awesome dog. Yeah. [00:35:47] OG: I think that’s one major thing to consider in terms of protection planning is further healthcare costs and or responsibility of healthcare things down the line. [00:35:57] OG: That’s down the line, right? Long-term care stuff is like 60 plus. That’s when you think about that, maybe 55. A more immediate thing would be disability. You know, if you’re sick or hurt and you can’t work for an extended period of time, you know, have another person that. Can pick up the slack or work extra shifts or you know, whatever. [00:36:14] OG: That would be a major piece that I would look at from a planning standpoint as well. And then further down the line, from a planning standpoint, the only difference is, is you just have to think about how do you wanna handle your estate given that the, like normal quote unquote, normal way of doing it, of everything goes to my spouse, and if not my spouse, my kids. [00:36:34] OG: And if not my kids, then my grandkids, you know? So there’s gonna be some different dynamics there of, well, I’ve got some nieces and I’ve got some nephews, and some of ’em I like, and some of ’em I don’t. And you know, this one’s done well with their life and is responsible and this one hasn’t. And you know what I mean? [00:36:46] OG: You have a little different dynamic there, I suspect. But again, that’s, you know, you’re 30 now, that’s like age 70 stuff, right? But in the meantime, you can just make sure that beneficiaries are right on your accounts. And probably now you list mom and dad or maybe, you know. Brothers or sisters or something like that if mom and dad are good to go. [00:37:03] OG: But from a planning perspective, I don’t really see a profound difference with two people in the family. You don’t spend twice as much, so it’s not like you get a half off discount on retirement. It’s, you know, there’s something there. But yeah, you still have to save money. You still have to invest, you still have to live with your means, manage your debt appropriately and that sort of thing. [00:37:21] OG: Uh, maybe not as much margin, the safety if there’s not two incomes, but. I’ve seen plenty of two income families go sideways. Just as quick as a single stone. That’s [00:37:28] Joe: Well, that’s the thing is being single, you are the backstop. Yeah. I mean, there isn’t somebody else that you can go, well, they might be the backstop. [00:37:34] Joe: They might not be the backstop. You are the backstop. Yeah. So I love that you led with disability for today, long-term care considerations for later, the idea that you’re estate plan once again, much later as well. But also I think the only thing I’d add on the short term is. You know, you gotta get the raise, the income stream is gonna come from you. [00:37:52] Joe: It’s not gonna come from anybody else. So just advocating for yourself and learning how to get the raise, making sure that you’re able to do that is gonna be important over the, the course of your forties and fifties. But I love how well she set herself up. I mean, mid thirties and 270,000 in the 401k. Oh gee, while you were talking, I was doing that rule of 72, the mathematical magical number. [00:38:14] Joe: Or if you take the interest rate, you think you’re gonna get divided into 72. It tells you how many years it takes it to double. So. Let’s say she’s said mid thirties. Let’s say she’s 35, then, uh, she gets 9% over a long period of time. Definitely a can do number every eight years. That means her money’s gonna double when she’s 43, when she’s 51, and it when she’s 59. [00:38:32] Joe: If she looks at retiring, let’s say at age 60, so at 270,000, she’s saved already with those three doublings. The first double sends it to 540,000, second to 1,000,080 thousand, and then the third one. 2.1, almost $2.2 million. She’s already saved without having to save another dime. So this phrase, you know, I hate all the cute phrases, but this quote coast FY also becomes a cool thing. [00:39:00] Joe: And that’s not, you know, that has nothing to do with your question about being single, but also, you know, choosing your adventure. Michelle, what do you wanna do? Because you’ve done a great job of setting yourself up with that, and I love the money in the HSA as well. [00:39:13] OG: Yeah. And the single piece of this is, like you said, you’re your own backstop here, so you have to advocate for yourself. [00:39:20] OG: You also have to take a little bit more measured risks than, you know, if there’s two incomes where one person goes, I think I wanna go start this thing. And I think it might work, but I don’t know. And but by giving yourself the head start by having a bunch of money saved already, you know, maybe you’re able to do that. [00:39:35] OG: You know, maybe you’re able to try the thing in your fifties. Because you’ve saved so much money and given yourself enough. So you’ve gotta build all that flexibility in yourself, basically, is what I’m saying. [00:39:44] Joe: Well, and one thing that gives her room to do og, she mentioned she didn’t tell us how much she owes on the mortgage, but you know, we’ve talked about how the happiest retirees, they know the math, but they pay off the mortgage early. [00:39:54] Joe: And maybe Michelle, if you give far enough ahead that you know you’re gonna be okay for retirement, maybe you can look at paying off that loan earlier, which buys you even more flexibility. Because if you have to be your own backstop, you want the commitments every month to be as low as possible. [00:40:09] OG: Yeah, I started using Monarch this year mostly just to have a couple months of data just to see, and then, and then it seemed like every month there was like, well, that’s just this one thing, you know? [00:40:21] OG: It was just this one thing this month, just this one thing this month. But it is pretty profound. I, I did get a little analytical with it and this year to see how much we spend in interest, just, you know, interest on a couple houses and. You know, if you carry a credit card balance or if you car loan or whatever it is, you know, it’s like you see that stuff pile up and then you start looking at that going, how much money do I have to make just to pay the freaking interest? [00:40:48] OG: You’re saying it doesn’t, doesn’t make sense to pay off your mortgage. I look at that completely differently. I knew it in my soul before I saw the data, but now I look at it and I go, I have to make. Thousands of dollars every single month just to pay the interest to the bank, to have this house, like the faster that, like it just decreases the overall stress, right? [00:41:07] OG: I don’t have, it’s like, oh, I don’t have to make this money. I don’t have this responsibility. So I’m a big advocate for paying the house off at a measured clip for sure. [00:41:15] Joe: Michelle, great to hear your voice, uh, after the fantastic letter a few months ago. Congratulations on a nice job so far, saving and really doing some nice, proactive stuff on your financial plan. [00:41:27] Joe: Next up, we’ve got Ron, who, you know, we’ve been talking about the student loan crisis a bit and talking about heck, on Monday show we talked about more people going into the trades and going maybe not college, and also talking about how college costs just keeps going up and up and up and up. Ron had some thoughts on the student loan crisis. [00:41:48] caller: Hi, my name is Ron and I enjoy listening to the Stacking Benjamins podcast. Recently you mentioned a student loan crisis where the millions of people are, uh, behind, uh, in their student loan payments to the government. The solution seems to be what we allow every other person who’s in financial trouble to do, it’s called bankruptcy. [00:42:11] caller: Whether it’s a, uh, poor decisions with their credit card, poor decisions in, uh, embarking on a small business or wrong decisions on a, uh, major corporation. We allow them to go bankrupt. Seven years. They’re free and clear. Yeah, they have some limitations and so on, but in today’s world, that seems to be rather minimal. [00:42:30] caller: But student loan debt, you people said it yourselves, you are interested in. Basically garnishing their social security, I believe is one of your statements. Let’s have them allow them to do bankruptcy just like every other person who made a financial mistake and not put them in debtor’s prison. Again, I enjoy listening to your show, but I, the comment that had to be made. [00:42:51] caller: Thank you [00:42:53] Joe: Ron. Fantastic. And you can hear he is a little passionate about this topic. I just want to correct one thing, Ron, we didn’t say you should garnish people’s social security. [00:43:02] Doug: Yeah. Yeah. Thank you. That’s what happens. I would, yeah. I, I used the word garnish, OG talked about how it’s gonna come outta your social security. [00:43:10] Doug: You’ll find you don’t have as much at the end of the party. Yeah. As you thought. And I said kinda like garnishing your wages, but the two don’t really go together. It’s not the same. [00:43:18] Joe: We did not represen present that as the solution. Just FYI. Right. One solution we talked about is. People decided not to go to college and there wasn’t so much societal pressure to go to college, then colleges through the law of supply and demand will not have a free lunch. [00:43:31] Joe: And if we stopped guaranteeing these loans, knowing that colleges can just charge more and more and more and the government will guarantee it, heck, that gives them carte blanche. Yeah. I mean, they can go ahead and raise prices. We propose those two things, more people in trades, which we need anyway. And number two, uh, the fact that the guarantee program, we might need to rethink, but. [00:43:52] Joe: But this idea of bankruptcy, oh gee. I mean he’s, he’s not wrong. People go bankrupt and because they messed up with their credit cards. [00:44:01] OG: Yeah. I honestly haven’t given much thought to how to solve this problem, both in the short run of the trillion dollars that people owe presently and, and over the long run of how do we fix it moving forward? [00:44:14] OG: I can see the pros and cons to both sides of it, which are eventually, this just gets passed on to taxpayers. If you do allow a big bankruptcy type thing, although frankly, is that how you wanna start your adult life is, you know, I don’t know. I, I don’t, I don’t have a good answer for it, but I do recognize that this is a, a major problem. [00:44:35] OG: And I would actually add one more to what you were saying, Joe, around solutions for this. And maybe just kind of dovetails into what you were talking about around, uh, the societal pressures. I don’t understand why there’s so much negativity toward. Doing the community college or the, the pre-college classes in high school where they’re part of your normal curriculum. [00:44:55] OG: It really kind of is a very one side or the other type of, either you’re really pro that or you’re really anti that. And it’s funny because, and just talking with people around this, because you know, it’s what’s in our life right now. The things that I hear from parents, just kind of anecdotally the things that they say is really interesting. [00:45:15] OG: They’ll say like, well, you know, I really wanted Johnny to get the full college experience and going to community college. You just wouldn’t get that. I. And I’m like, what? What part of college experience are you? You miss the drunk frat parties. Is that part of the, and honestly, I think there are some parents that think that, that’s a rite of passage. [00:45:33] OG: You know? Like, no, no, no. You haven’t lived until you’ve thrown up in somebody else’s shoes before. You know? And it’s like, I’m okay with my kid not experiencing that ever in his [00:45:42] Doug: life. You know? We make that joke off. It’s easy for a lot of people to make that same joke. What about, you know, being hungover and, and all of that? [00:45:48] Doug: That’s an easy joke, but I think. Honestly, a huge benefit for both of my guys going away to college wasn’t that part. Of course, it was the living alone and having to manage your daily life living alone versus staying with your parents and, and doing community college. Yeah. So I think you can get that experience and still go to community college. [00:46:04] Doug: Just get your butt out of the house, get a job, go to community college and get an apartment. [00:46:09] OG: Yeah. Or what’s the problem with that experience happening at 20 instead of 18? I mean, there’s, there’s countries that have mandatory. Military service, right? You gotta do a certain amount of military service time between high school and advanced school. [00:46:22] OG: Mm-hmm. College, whatever. I’m not saying that that’s a solution. I’m just saying like there’s lots of ways to grow up. We have for some reason, decided that 18 is the grow up age. It’s like, well, you’re 18, you gotta grow up. It’s like, well, we’re almost, almost 10 years early. Have you? Yeah. Have you been around 18 year olds? [00:46:39] OG: Because they’re not even starting, no offense to my son, but he’s, he just, he was like, I don’t know how to reschedule my Apple. My Genius Bar appointment for Thursday. Can you help? Oh my God. One thing at a time, dad. One thing at a time. And so, you know, I’m happy to help him with it, but we have adopted this as the thing right. [00:46:59] OG: There are some people who say like, oh no, I don’t wanna have, I don’t wanna put that pressure on my kid to like have to do all those college level courses in high school. [00:47:08] Doug: Okay, [00:47:08] OG: fair enough. Just like there’s people on the one side that go, why wouldn’t I have my kid do all this college level work in high school? [00:47:14] OG: It’s free. Like, why taxes are paying for this. Why wouldn’t I have if they’re able and confident and smart enough to do that at that time? It’s like for some reason there’s this, like you said, Joe, there’s this societal. The weird thing that happens like, well, I can’t because Johnny needs to go away to grow up. [00:47:32] Joe: Or even, like you said when we were talking about this before about college og, I think at one of the last week shows we were talking about, you know, even your son going, well, yeah, he’s not gonna college. I. You know what I mean? The kind of whisper campaign against kids that don’t go to college. Like there’s something [00:47:46] OG: less. [00:47:47] OG: When I was in highs, I mean, this isn’t new, by the way. When I went to high school and I joined the Marine Corps, I’d signed on the line in February. So I was still in high school. You know, I was, you know, you signed up early. Basically, I’ll leave on this day, and I was in the school play. I was in the school musical that year, that spring, and I had to go do like a physical test, you know, and some other stuff at the training center. [00:48:08] OG: Anyways. So I told the play director, I said, Hey, I can’t go to practice today. I gotta do this thing down in Lansing. And he said, what? What college thing? I said, well, actually, I joined the Marine Corps, so I’ve gotta do this thing. And he said, you did what? Hmm. You know, and I said, well anyways, I gotta do this thing the next day. [00:48:26] OG: I didn’t go to a class. Every time I sat in a class, the teacher would go, uh uh, you need to go see Mr. Smith right now in his office. And I did like this rotating, like it was like it went around at that school. Joining the military was like, no, no, no, no, no. We don’t do that here. You go to college from this school? [00:48:43] OG: I, [00:48:43] Doug: yeah. I mean, look at one of the key stats that people look at when they look for what school districts they wanna move into. And it’s the percent of high school graduates that go college. That go to college. That go to college. Yeah. It’s a major metric. [00:48:54] OG: Yeah, it, it certainly is. You screwed your whole town over og. [00:48:57] OG: I’m just saying 30 years ago. 30 years ago, this was still a thing. Yeah. And it was, it a little different but still. So I dunno, there’s no right answers here. [00:49:07] Joe: And Ron, obviously we’re not gonna solve this on the Stacking Benjamin show in a [00:49:11] OG: 10 minutes. It’d be cool if we did right? Like we just kinda Yeah. [00:49:13] OG: Solved it. Solved it. And uh, we’d just [00:49:15] Joe: keep talking. I bet [00:49:16] Doug: you we stumbled [00:49:16] Joe: on something, we’d probably figured it out and then a whole nation, nation will unify behind it and everybody will get on track and agree on the same thing that we decided. Yeah. Easy. You’re on the show? Yeah, generally on Stacky Benjamins, of course, we’re about, these are the rules, what do you do about it? [00:49:31] Joe: And certainly one thing you can do is declare bankruptcy. So there it is. Let’s finish this off with Vij, who is, uh, only last because he was, of all the questions we took today, the last one to ask a question alphabetically so we can get to your, it’ll be both ways, I guess. Yeah. [00:49:48] Doug: Yes. [00:49:48] Joe: Vij, you’re, if, if you would’ve been first in line. [00:49:52] Joe: I love og when you were talking about your son, uh, that you guys were what, uh, third in line at graduation. [00:49:57] OG: Yeah. [00:49:58] Joe: Third in line at graduation. Then Doug, he had to sit through that entire boring kid by kid thing, the rest of it after his kid. And [00:50:04] OG: then you feel bad ’cause you’re like clapping and then you’re like, I’m done clapping. [00:50:08] OG: And then the people behind us had their kid, they’re like, woo. And I’m like, yay. Because I didn’t wanna be not clapping for their kid, but they were right behind me. Back up. Proximity [00:50:16] Joe: bias. Yeah. There is definitely an upside to be in an S Yeah, I suppose there. So, uh, but anyway, vj, uh, thanks for the question. [00:50:24] Joe: Let’s hear what’s on your mind. [00:50:28] caller: Hey, Joe Ji and neighbor Doug, I’ve got a question about emergency funds. Is there a reason not to keep your emergency fund in an ETF like s gov instead of a high yield savings account? I understand that like instant access might be one concern, but beyond that, is there anything else I should be thinking about? [00:50:46] caller: The yield difference might not be huge for small balances, but if someone’s keeping a year expenses in there. That could add up to a few hundred bucks. Uh, so curious to hear your thoughts. Thanks and see ya. [00:50:58] Joe: Thank you, vj. That’s hilarious with the classic Doug Signoff too. Badass. Call og uh, sv. For people that don’t know this, the iShare zero to three month treasury pond, this thing has barely a live person’s heartbeat when it comes to volatility. [00:51:15] Joe: So what do you think about heading that way with your emergency fund? [00:51:20] OG: I mean, if you look at the underlying investments, then you would sign off on that as a cash holding, right? Because it’s zero to three month US treasuries. That’s totally acceptable from a savings standpoint. The only issue is the liquidity, like he brought up, meaning it’s gonna take you a couple of days to get the money, which honestly, if you’re thinking about this like a tier, you probably want in, in his example, he said a year of cash reserves. [00:51:45] OG: So maybe you’ve got one or two months worth of expenses in your checking account. Maybe if you’ve got a month of expenses in your savings account. And that just kind of keeps the float going of paycheck going in and bills going out at a asynchronous time. And then maybe in his case, he’s got nine months of. [00:52:00] OG: Emergency fund money. Yeah, that totally is fine In, in a, a treasury ETF or a actual treasury bill or bond itself, like whatever floats your boat or a savings account, and you’re right, it’s not that big of a difference. I, I think you can find good savings accounts right now in the 4% range. SGOV probably paying a little bit more than 4.5% would be my guess in terms of dividends. [00:52:23] OG: So you’re picking up a half a percent. Just like you said, if that’s a hundred grand, you know, that’s $500 a year. The question of course is, is all of that juice worth the squeeze? So if you are talking about a bunch of money and it’s five, 600 bucks a year, I can see why it would make sense. If your emergency fund is three months and you’re going, well, I’ve got 10 grand in this account, is it worth it? [00:52:45] OG: Probably not, you know? No. I like to have the simplicity of keeping everything where it’s supposed to be. And what I mean by that is. If you’re gonna have bigger issues trying to move money from one place to another to cover stuff in your emergency fund. Like let’s say for example, you’re trying to over optimize everything and, and you say, well, I don’t need a month worth of money in my checking account. [00:53:07] OG: I need a week’s worth of money in my checking account, and then I’m gonna take money for my savings account and I’m gonna put it in my checking account when I get paid, you know, and I’m gonna do all this stuff right, so that I can make it all exactly optimized so I have the most money in my savings account, or most money in SEOV, and then you miss one Friday of doing it because you’re sick or you’re traveling. [00:53:24] OG: On Monday, you get hit with two $35 overdraft charges because you didn’t get the money in fast enough, even though you’ve got it. Like what? What did you gain from that? Also, how much is your time worth than having to manage your cash flow on a day-to-day basis? I would much rather have two months worth of money in my checking account a month in my savings account. [00:53:42] OG: Link those two together and then check the balances on the 30th of every month. You know what I mean? Like batch that transaction. Yeah. Or batch that time into one thing. So if he’s talking about a, a year of cash reserve or a two year cash reserve where he’s really super funded, his, his emergency fund and he’s like, oh yeah, I’m, I’m, you know, I would need to, I would know that there’s a problem weeks in advance that I would need this money and so I’m okay with the fact that this doesn’t take, take a couple days and that sort of thing. [00:54:09] OG: Absolutely. Have fun. Get after it. [00:54:12] Joe: There are some people that might wonder why you would have that much money in emergency fund. I can think of three reasons. Number one, if the career you’re in is very volatile. And it’s gonna be difficult to find another job and you’re living off a decent amount of that. [00:54:25] Joe: Uh, yeah, a money, a decent percentage. That’s number one. Number two is Paula Pant has talked about the fact that she’s got two different emergency funds. She’s got one for her, but also her real estate business. And if she has vacancies over a number of months, then she needs to keep some money also there. [00:54:40] Joe: So that can also equal maybe a year or more. [00:54:42] OG: Well, and remember also that. Your spending and my spending are different numbers. And so when, when you say like your cash reserves a hundred thousand dollars, and some people go like, oh my God, that’s so much money. And some people go and she’s like, that’s three weeks. [00:54:55] OG: That’s like a month and a half. You know, I’m a little underfunded right now. It’s a little light. So it’s not the absolute dollars, I think is what you’re saying. You know also, yeah. [00:55:05] Joe: And then there’s the third one, which of course is if you are financially independent, you’re living off of your assets, you’ve always advocated, keep a couple years in cash so that you’ve got that. [00:55:14] Joe: Yeah, you should have, [00:55:14] OG: if you’re getting close to retirement or retired, you should have two years worth of your portfolio distribution sitting in cash. And SGOV is a great place for that. Or money market fund, you know, again, all of those are fairly similar. You know, you’re not gonna pick up or lose anything in any one of them. [00:55:28] Joe: One thing to look out for when I was looking at this on Morningstar is that while SGOV hasn’t lost money, the index that they compare it to has lost money before. So you can have lost a principle. So if losing principle from time, it ain’t gonna happen often. But if losing principle is the deal breaker for you, you don’t want SGOV. [00:55:47] Joe: Thank you so much stackers for the comments, for the questions, for your enthusiasm. Just absolutely. I love what, uh, all of you are doing, some people doing kick ass stuff. Guys, if you’ve got a question for the show, it’s stacky Benjamins dot com slash voicemail. And if your goal is not just to answer one question, but really to dive into your financial plan and do this better, OG and his team are. [00:56:10] Joe: Taking clients this summer. So head to stacky Benjamins dot com slash OG that’s linked to he and his team’s schedule. And you know what? You can, instead of getting one question answered, you can get your financial plan all dovetailing the way that you want it to. Great episode today. Always love those. [00:56:27] Joe: It’s been a while since we’ve done a mailbag episode. We haven’t [00:56:29] OG: done it in a while. Yeah. [00:56:30] Joe: Yeah. Doug, put a pin in this. What are maybe the, uh, three big, uh, to-dos we should have today? [00:56:37] Doug: Well, Joe, first take some advice from our answers to VJ and Tovan Weather. Saving for a House or building your emergency fund. [00:56:45] Doug: Think safety first, and then growing your stack. You want money there when you need it. Second, remember our advice to Michelle and Lori. By working ahead of time on your estate plan, life is much easier for everyone involved who’s still around. After you’ve passed away, hey, pay it forward. But the big lesson, don’t bother asking Joe’s mom to turn down the Michael Jackson music. [00:57:10] Doug: Seriously, it truly is loud. I can’t believe our microphones aren’t picking this up, but ma, don’t turn it down. OGs on his way up there right now to dance. Thanks to you for joining us today for our mailbag episode. Have a question for the show. Leave your voicemail at Stacking Benjamins dot com slash voicemail. [00:57:30] Doug: We’ll also include links in our show notes at Stacking Benjamins dot com. This show is the Property of SP podcast, llc, copyright 2025 and is created by Joe Saul-Sehy. Joe gets help from a few of our neighborhood friends. You’ll find out about our awesome team at Stacking Benjamins dot com along with the show notes and how you can find us on YouTube and all the usual social media spots. [00:57:56] Doug: Come say hello. Oh yeah, and before I go. Not only should you not take advice from these nerds, don’t take advice from people you don’t know. This show is for entertainment purposes only. Before making any financial decisions, speak with a real financial advisor. I’m Joe’s Mom’s Neighbor, Duggan. We’ll see you next time back here at the Stacking Benjamin Show. [00:58:27] caller: Okay. I’ve sat here trying to think of something pleasant to say after that, and I can’t.
Leave a Reply