Jump into Monday with a whirlwind of money topics! We start by celebrating the arrival of fall and the excitement around baseball playoffs (especially for Detroit Tigers fans). But the real fun begins after we salute the troops and dive into the main event: a riveting conversation with Erin Wade, a former lawyer turned chef and entrepreneur. Have you ever thought that you wanted to do more with your life than you’re currently doing? Erin shares her tumultuous journey from corporate law to opening one of America’s top restaurants, Homeroom, and drops valuable lessons on following your passions and creating a rewarding work environment.
During our headline segment we discuss the recent Federal Reserve rate cuts and what it means for your finances. How can you benefit from lower interest rates? We’ll dive into how interest rate cuts work and help the economy. We discuss what this means for your savings, your debt strategy, and more. Plus, macaroni and cheese related trivia AND—how to take your mac and cheese recipe to the next level!
- Monday Morning Musings
- Baseball Playoffs Excitement
- Saluting Our Troops
- Introducing Today’s Guest: Erin Wade
- Mac and Cheese and the Holiday Season
- The Journey to Entrepreneurship
- The Importance of Passion and Play
- Challenges and Triumphs in the Restaurant Industry
- Empowering Teams and Open Book Management
- Mac and Cheese Tips from the Expert
- Mac and Cheese Tips and Tricks
- Doug’s Mac and Cheese Trivia
- Powdered Cheese and Nostalgia
- Federal Reserve and Interest Rates Explained
- Impact of Interest Rates on Loans and Economy
- Credit Scores and Mortgage Tips
- Car Market and Financing Insights
- Upcoming Events and Closing Remarks
- Post-Game Press Conference
Deeper dives with curated links, topics, and discussions are in our newsletter, The 201, available at https://www.StackingBenjamins.com/201
Enjoy!
Our Monday Mentor: Erin Wade
Big thanks to Erin Wade for joining us today. To learn more about Erin, visit ErinWade.co. Grab yourself a copy of her book The Mac & Cheese Millionaire: Building a Better Business by Thinking Outside the Box.
Our Headline Topic: Interest Rate Cuts In The News
Car buyers face a stubborn problem that Fed interest-rate cuts can’t solve: record-high prices (MarketWatch)
Doug’s Game Show Trivia
- What company patented powdered cheese?
Other Mentions
How The Economic Machine Works (Ray Dalio)
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Join Us on Wednesday!
Tune in on Wednesday when we discuss how to stop saving for retirement LONG before you retire. The call it “Coast FI,” we call it “buying flexibility.”
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Written by: Kevin Bailey
Episode transcript
[00:00:00] Monday morning in America, and it is, it’s funny, it’s Monday and I don’t know if, are we in October yet? Has October happened? [00:00:09] It happened yesterday. Uh, last night as a matter of fact, between oh 3:00 AM and 5:00 AM a massive hail storm. And I woke up this morning, it was 60 degrees. So welcome to Fall, Texas. [00:00:19] No, wait a minute. It happens. It happens tomorrow. It’s still September. Dude. You’re in a bad dream. Oh, tomorrow’s, tomorrow’s September 31st. Oh, yes. Well, all the above. I can’t wait though. I keep looking at the weather by the way. September 31st. AKA October one. [00:00:36] Hmm. [00:00:36] Baseball playoffs. Doug and I are excited about the baseball playoffs. [00:00:39] Well, [00:00:40] did the T grays make it? [00:00:42] Yeah, of course they did. And as we record this, I’ve crossing my fingers. Fingers. [00:00:47] We’re trying to create the future by saying it. [00:00:52] Of course. The best team in baseball, baby. Speaking of that, you know, I wanna salute the Detroit Tigers, whether they’ve made it or not as of today, but I’ve got somebody better. We need to salute, which is our troops, of course, like we do every Monday here on the podcast. On behalf of the men and women, make it podcast to mom’s basement and the men and women. [00:01:13] Cheers serving our troops at Navy Federal Credit Union. Here’s to those men and women keeping us safe. Thank you for all you do. Let’s go stack some Benjamins together. [00:01:23] You’re going to end up eating a steady diet of government cheese and living in a band down by the river. [00:01:36] Live from Joe’s mom’s basement. It’s the Stacking Benjamins Show. [00:01:51] I am Joe’s mom’s neighbor, Doug and Think you can’t pivot to that career you really love. Today’s guest will share her story swapping the suit as a lawyer and throwing on an apron to create one of the USA’s top restaurants. Whether you work for yourself or are dreaming to one day, today’s mentor, chef and entrepreneur, Erin Wade is here to help in our headlines. [00:02:13] The Fed slashed interest rates by half a percent. What does that mean for your money? We’ll share strategies and then I’ll also dish out a spoonful of my amazing trivia, and now two guys who are the macaroni and cheese of this show. Joe and o Ju ju gee [00:02:39] I’ll let OG bring the cheese. I’m gonna call the macaroni. Hey everybody, happy Monday. Welcome back to the Stacking Benjamins Show where we are ready to kick off another week with a great guest, Erin Wade, coming down to the basement and og I’m super excited because anytime we can talk macaroni and cheese, it’s kind of one of the major food groups I think, right? [00:03:03] Absolutely. [00:03:05] You’ve got your carbs and you’ve got your macaroni and cheese, like in, uh, elf. It’s like candy, candy, cane, candy, corn [00:03:12] syrup, duh. Gotta have all the above. We got summit. Remember the free gum scene by the way? [00:03:17] Mm-Hmm? Yes. Free gum. So gross. So yummy. [00:03:20] We’re getting that time of year though. It is the holiday season and we are kicking things off in running into October. [00:03:28] Just an exciting slate of shows. Erin Wade today, and man, the stuff we’ve got waiting for you the next few weeks is fantastic. Thanks to everybody who’s left us a fantastic review of this podcast. Got some new branding on the show, og. It’s like a fresh coat of paint on the Stacky Benjamins machine. [00:03:45] Lipstick on the pig. Maybe not that. Oh, sorry. Not that. We’ll Back off that one. By the way. How are you doing this? Fine. Fall morning. [00:03:56] Just living the dream. Just dreaming about pumpkin spice Lattes putting up my decorations tomorrow for Halloween. [00:04:03] Are [00:04:04] you really? I. [00:04:05] I was so busy last year we didn’t put out our Halloween decorations. [00:04:09] We generally forget about it until about like, oh crap, isn’t Halloween’s coming up Pretty soon. We should probably put some, uh, spiders out in the yard or something that goes, you know, something like that. And, uh, that’s there for a week and a half. Then we do our Christmas decorations right after Halloween. [00:04:25] Oh, you’re [00:04:25] those people? [00:04:26] Well, we don’t turn ’em on ’cause the weather’s good, right? Sure. You know, in Texas it can turn gnarly anytime after November 1st it could be 40 and snowing sideways. So we just get ’em done and we don’t turn ’em until Thanksgiving. But they’re up like, we’re like the Disney of Thanksgiving and Halloween. [00:04:44] Like we just turn everything over in one night and it’s like a magical winter surprise [00:04:49] on November 1st. Incredible Clark Griswold up there on the Clark OG up there on the rooftop. Well, [00:04:56] yeah, imagine Clark hiring people to do it and watching with a glass of bourbon and a cigar from the porch. That would be a fair representation. [00:05:05] It’s exactly the same that basically almost the same. It’s pretty close to the same. [00:05:09] If Clark Griswold got out a checkbook [00:05:12] and Yes. Had some helpers, had a nice, put stuff out Padron cigar while he, uh, si a couple fingers of bourbon and went, no, no, that’s the white one. White light’s there. Yeah, white light’s there. [00:05:25] Spoken like an entrepreneur, by the way. Thank you. Somebody who’s learned how to delegate, which is one of the hard things, I think, for people to learn how to do, whether you’re an entrepreneur or entrepreneur. Erin Wade’s gonna talk today about building a team, but, OG, you’ve known nothing but being an entrepreneur. [00:05:38] Like you’ve been an entrepreneur your entire life. [00:05:40] Somebody sent me an email on this. I said, I’ve never had a W2 job in my life. And somebody goes, oh yeah, I thought you were in the Marines. And I’m like, okay, you’re right. I did that. But I’m talking about like a, okay, I did government work. I did, I did contract work, you know, like wet work, fine count that. [00:05:56] But I’m saying like. You know, I don’t wanna say real work either. That’s not, but you know what I’m talking about, like all of my non-military jobs. I’ll just say that from now on, all of my non-military jobs my entire life have been. Pay for performance. That’s all I know. I couldn’t imagine a, a better way. [00:06:12] I have a friend who just, uh, just retired, quote retired and yesterday was showing me all of his stuff. ’cause he’s decided to open a consulting company. Yeah, it looks really good. He’s got a new website, he’s got all kinds of good stuff. So if you’re dreaming about what am I gonna do during my quote, retirement years. [00:06:28] Erin Wade’s here for you. If you’re dreaming about making the pivot from the job you really don’t like to the thing that you wanna do, Erin Wade’s here for you today. If you’re somebody who is working in a team that’s not working the way they should, she’s gonna talk about that today. We got all that. [00:06:41] We’ve got interest rates. Times be a change in OG instead of rates going up, up, up. We had a big slash a couple weeks ago, so we’re gonna dive into that first. But before we dive into anything, we’ve got a couple of sponsors who make this show go so that you get all this funness for free. Funness, is that a word? [00:07:01] Funness. You get all this funness? Yes. [00:07:02] Most, most good funness. [00:07:03] Most be good funness. Uh, for free. Let’s hear from a couple of them that we’re off and running. Erin Wade kicking off today’s show on Mentor Monday. Erin is a bestselling author, chef, an entrepreneur. She opened the wildly popular restaurant homeroom. [00:07:18] I. It’s been covered everywhere from the Cooking Channel, the Wall Street Journal. She authored the bestselling Mac and Cheese cookbook. Oh my goodness, I can’t even get through that sentence without salivating, as well as a viral op-Ed in the Washington Post, so it was named one of the publications Best of the Year. [00:07:35] Her work in business culture has been covered in Forbes, the New York Times. She was named one of the 35 World Changing Women by Conscious Company Magazine. She has a public policy degree from Princeton. I love how, by the way, some of the world’s best chefs have degrees in other things. It isn’t about that specialty og. [00:07:52] It’s about learning how to think. Right. That is from Princeton law degree from uc. Berkeley lives in the Bay Area with her family and array of surfboards, but today she’s coming down to mom’s basement. Let’s say hello to Eric Wade [00:08:09] and am super happy. She’s on her way down to mom’s basement. Erin Wade is here. How are you? Hi. I am great. Thanks so much for having me. Well, it’s so funny because we’ve been talking about you of course, in the Introduction Today Show. And do people often say that when they know you’re coming around they get hungry? [00:08:27] Yeah, people are always happy, uh, when they hear I’m coming over ’cause they know mac and cheese will be somewhere nearby. [00:08:32] Well, and what is it about mac and cheese with all of us? I mean, you, you write at the book that you have spent probably more time around mac and cheese than anybody. That’s a pretty bold claim. [00:08:40] Erin, that’s a very bold claim. [00:08:42] You know, I had a friend who we were talking about things to give up to improve your quality of life and she’s like, you know, I don’t care. Whatever happened with my body, I would, I would never go on a diet. And I was like, interesting. How come? And she’s like, you know, nothing else brings me joy three times a day. [00:08:57] And I was like, you know, you just nailed it. And when it comes to bringing you joy, like really what brings you more joy than comfort food, which is something that doesn’t serve much of a deeper purpose other than I. Sort of this nourishment of your soul and feeling comforted and feeling happy, right? [00:09:15] It’s not the most nutritious food you’re ever going to eat, but it’s certainly some of the most delicious, [00:09:19] I think about that quote, uh, old quote from Tony Bourdain where he says, you know, your body’s not a temple. It’s a play toy, so feed it. Fun stuff, right? [00:09:28] Totally. Absolutely. Yeah. [00:09:31] Well, as the foremost expert, you have to be the foremost expert at Mac and Cheese. [00:09:35] I thought it’d be a fun way for us to start the interview by just testing your mac and cheese knowledge a little bit. Oh, and oh man. By the way, all the stackers out there, I’m totally. Ambushing, Erin with this, where does Mac and cheese originally come from? Do you know the history of mac and cheese? [00:09:53] So I actually believe it’s a early American invention. [00:09:56] Uh, it goes back to Thomas Jefferson, who I don’t know what he was trying to create, recreate from European vacation, but um, a lot of the earliest recipes are dated back to his kitchen. [00:10:08] Absolutely. And it’s interesting. Was I [00:10:10] right? You did more homework than me. You were incredibly, I’m pretty sure that’s the right answer. [00:10:15] You were incredibly [00:10:15] close. He loved eating it. He didn’t love making it Uhhuh. And what was even more interesting about the fabric of it, a lot of the invention of macaroni and cheese came from, sadly, the slaves that worked in his, his kitchen. Not sadly because they had this awesome food, but sadly that he didn’t wanna make it. [00:10:32] He wanted his slaves to make it, and then he took it and ran with it, wanted to serve it to everybody. [00:10:37] Yeah. No, I mean, I, I actually, it did not, that’s why it actually has such a deep connection to the black community in the United States and why it’s like a staple in, in so many homes. ’cause yeah, that was a deep part of its origin story, [00:10:49] I gotta tell you. [00:10:50] We’re very proud here at Stacking Benjamins Air and of where we get our research from. We make sure that we go to the best sites. This comes from cheap.com. By the way. Oh really? Which, as you could tell by the name high, high quality work that they’re doing over at cheap, no offense. Cheap. I don’t know if it’s great or bad, it just seems like, you know, thrillist.com or whatever. [00:11:12] Something I hadn’t considered, by the way that was on this cheap site is that mac and cheese pears really well with alcoholic beverages. I’m sure you may know that better than most. [00:11:22] Yeah. I mean, on the menu, at my restaurant homeroom, we would do beer and wine pairings for all of our Mac and cheeses. [00:11:28] ’cause it’s pretty delicious. [00:11:30] I gotta make a, I feel like it’d be going to Mecca. I’ve gotta come to homeroom. I I have to. [00:11:35] You’ve got to. That’s true. [00:11:37] Well, let’s start here. You say you started working with Mac and cheese for love, but not romantic love. What kind of, what kind of love do you mean? [00:11:48] Yeah, so I mean, really, you know, my book is about the pursuit of a very different kind of love that we maybe don’t talk about as much, which is wanting to love your life, to wake up in the morning and enjoy what you’re gonna go do with your day. [00:12:00] I had not had very fulfilling careers up until that point, or worked at places that I enjoyed working. And so starting my own restaurant, leaving my work as a lawyer was really a, a personal odyssey to see if I could find more fulfillment at work by creating my own workplace and really innovating and seeing if I could make it a place that other people wanted to work as well. [00:12:22] You begin your story with surfing. What does surfing Mm-Hmm. Have to do with being an attorney or macaroni and cheese? [00:12:30] The story begins with surfing. It’s such, it’s actually just a hobby of mine to talk about. How important it is to just get in touch with what you love and how that has been trained out of most of us. [00:12:42] And that if you do, we forget that it’s not effort to become very good at that thing. And when we don’t love what we’re doing it, it’s a lot of work. I have a really obsessive surfing habit. People always say they’re so impressed. And my response is like, this is the not work for me. Like, I’m always excited to go. [00:13:00] It’s easy to make the time, and in fact, it’s, it’s hard to not go versus people who’ve made promises to themselves to say, go to the gym. And it’s like, if that’s not your joy, it’s, you’re not gonna get good at it. You’re eventually gonna give that up. And so sort of talking about getting in touch with our passions and having that really lead what we do, whether that’s a hobby or our work, paying attention to what lights us up inside. [00:13:21] And following that, [00:13:22] are you familiar with the work of, uh, Catherine Price in play and she talks about play? Mm. And how we really need to, I think her book is called The Power of Fun. [00:13:31] I should read that. No, I’m not familiar. [00:13:33] Oh, it totally is congruent. Erin, with your story, which we’ll keep getting into because it’s funny that you’re spending all this time. [00:13:41] I think you, you write that for the whole first year, you don’t even catch a wave, right? You’re just out there with a surfboard just loving what you’re doing. [00:13:48] I picked up a sport, really just looking for something for myself, you know, I was at that point a CEO of my company. I had a kid, um, actually I had two, this was after the birth of my son and, uh, looking for something that was just for me and took a, a surfing class and was so happy being in the ocean that I just made a promise to myself I was gonna do it, you know, once a week for a year and see how it changed my life. [00:14:09] And it, it genuinely did. And I kept sort of upping the ante. And each year I’d go more and more. Now, I mean, I go a few times a week, but. It’s very easy to lose touch with ourselves and the things that light us up and you know, finding those things, pursuing them, you know, I found not to just to be personally fulfilling in the case of surfing, but so professionally fulfilling in the case of homeroom and starting my own company. [00:14:31] And I found that if I just follow the things that bring me joy, it’s actually so rare for people to do that, that it’s infectious. You know? People wanna come work with you. They want to come and buy the thing you’re selling because so few people do stuff out of a place of pure passion that people just wanna be around it. [00:14:47] We have this, I don’t know, I kind of refer to it as the puritan ethic, the thing we think we are supposed to do. And so you’re working in this job that you feel like you’re supposed to do, you’re an attorney and you know, people hear attorney, they’re like, wow, Erin’s doing some great stuff. Yeah. But you contrast that with surfing, but you also contrast it with, was the story about your brother playing soccer? [00:15:08] Like was it your brother who hated soccer? [00:15:11] Yeah, I started to tell a story about my little brother who very famously did not enjoy playing soccer. And one day in the middle of the game he just lays down on the field just like flat on his back and he is like, take me out, coach. I can’t do it anymore. And yeah, I say, you know, for me I was working as a corporate attorney and getting fired from my job was a little bit like that. [00:15:31] Like I had just basically been laying down on the field and waiting for someone to notice. And sure enough they did and I was fired and I, I really deserved to be fired. ’cause like my brother, I didn’t care about what I was doing. It showed, and so it was time to try something that, you know, I actually wanted to get on the field for. [00:15:49] You write that whenever they wanted you to stay over, take on additional projects. Erin Wade was like, Nope, not gonna be me. I’m just going to put in the time. [00:16:00] Yeah, I really was just doing the bare minimum to skate by and I was being paid really an obscene amount of money for someone my age at that time. [00:16:08] And like I said, I deserved to, to lose that job. I was always like the last person to volunteer for any project or stay late or work weekends. And that was part of the expectation. And getting fired was a real wake up call for me. ’cause I was actually a really driven person. I’d always been really motivated to learn and to grow. [00:16:25] And so I think getting fired, I was like, huh, I’m not good at this. Not ’cause it’s not possible, but because I don’t want to be, ’cause I don’t care about what I’m doing. And I think that actually felt like the deeper failure given up on life in that way. So, well that, [00:16:38] that was my question. Did you feel like a failure at that point when you got fired? [00:16:42] You know, I wish I could tell you that I was super relieved and I eventually was, and I now see it as like one of the greatest opportunities that I have been given. But at the time I was actually quite, quite devastated. I think it’s hard to be fired, you know, it’s hard for someone to tell you you’re failing, we don’t want you here anymore. [00:16:58] You know? Um, even if you don’t even like what you’re doing. So yeah, it, it hurt if I’m honest, but I did see it as a huge opportunity and I, [00:17:06] I hopped on it. It’s funny because I feel like in some ways our paths are so congruent. Getting fired was devastating for me. I got fired from my job early on. But Erin, looking back, it was the best thing that could happen to me. [00:17:18] Oh, totally. I mean, I don’t know if you feel the same way, but when people hear my story, they’re like, oh, you’re so brave. You left being a lawyer to open, open a restaurant. And yes, that like took a. Big leap of faith on my part and a higher degree of risk tolerance than I’d had to that point. But I credit the woman who got me fired. [00:17:33] Like, I don’t know that I would’ve had the courage to leave. I was making good money. It just, I don’t know how long it would’ve taken me had I not been fired to leave and try to do my own thing. I might’ve, I might still be there today. So, you know, I think I’m always encouraging people, if you’re feeling that way, don’t wait for someone else to make that decision for you. [00:17:52] Yeah. I’ve never found a time when somebody’s like, if I just would’ve waited a little longer, life would’ve, the rainbows would’ve shown up, you know? Yeah. The cool thing though, about your experiences an attorney, I really got the feeling from you that. You were able to learn from that time, not just about being passionate about your life and about doing the thing that really lights you up, but also your boss was such an ass, and I really feel like Erin, that relationship with your boss informed you later of being a boss of other people. [00:18:25] Tells a story about just how bad this boss was when you were an attorney. [00:18:29] I had not been in the kind of what I would describe as a super positive work environment. Up until that point I was like researching a project and it was quite a de, she was just quite demanding and at some point gave me a research assignment and kept calling me every minute on the minute to see if I had found the answer yet. [00:18:44] Which, you know, it makes it like literally impossible to find the answer when someone’s ringing your phone every single minute to see if you’re done. So, you know, and that was like a typical day at the office. I felt like [00:18:54] reading it, by the way, for people that may have seen this, I felt like, have you ever watched the show Suits? [00:19:00] Mm-Hmm. I felt like your boss was Lewis on Suits just antagonizing you and antagonizing you didn’t really care about. The answer was just, I don’t know, flexing or proving some stup1d point that they were more powerful than you or something. [00:19:13] Yeah, I mean I think that that’s sort of the tough thing about the way work has operated for so many people. [00:19:20] People have been treated a certain way and then they sort of pay it forward and treat other people in that way. And legal profession is not known for happy people. It has like some of the highest rates of suicide and alcoholism and all sorts of divorce, all sorts of stuff. So that was really a central challenge when I started my own companies being like, shoot, how am I going to do something different? [00:19:40] ’cause I haven’t really seen it modeled for me and I don’t want to just emulate what has been done to me. ’cause then this place will be a terrible place to work. [00:19:48] Well, and that informed, I would think, informed something that went hugely viral for you, which was your feelings around harassment. Like having been harassed, but not just harassed in this way, but harassed in many, many different ways. [00:20:02] Yeah, my team at the restaurant I sort of articulate, we ended up over like, you know, the decade that I was CEO figured out all of these really incredible systems to really maximize connection, communication, collaboration at work. And one of the many outcomes of that is that financially our performance was in the top 1% of restaurants. [00:20:23] Um, our turnover is 10 x the industry average. But we ended up coming up with like this harassment prevention system, which I then wrote a viral Washington Post piece about. I testified about it in front of the EEOC and it was adopted as a best practice by them. So one of the cool things is when you create a different place for people to work and you really engage them, I mean, you can genuinely like come up with stuff. [00:20:45] You know, in our case we did something that really changed the world. Our system’s now used by restaurants and bars, truly around the globe. And, um, really proud of it. [00:20:54] Just to close the book on being an attorney, you have this whole wonderful. Couple chapters about the phrase being let go and about how truly being let go is a great thing. [00:21:05] And I know we’ve already covered this, but I love that phrase. I, I love the idea of being let go and how they’re giving you permission to go to the next step. But the next step that you take though, Erin, you must have known, you keep coming back to this idea of a restaurant. [00:21:20] Mm-Hmm. [00:21:22] I was a financial planner for a long time before I did financial media. [00:21:25] And my clients back in the day would come up to me and they’d say, I’m thinking about opening a restaurant. I’m like, why don’t you take two aspirin and go to bed? [00:21:31] Yeah, yeah. [00:21:34] Tomorrow morning, call me when you’re sober. You know, [00:21:36] whatever. Yeah, whatever it might be. [00:21:37] Absolutely. Like you must know, the ROI on a restaurant is absolutely horrible. [00:21:41] How did you keep coming back to restaurant? [00:21:45] Well, you know, I think a little bit like the surfing analogy, it certainly was not a practical decision. You know, I did not do it saying, Hey, this is really just gonna make me the most money. I did it because I’d always loved restaurants and I’d been obsessed with them. [00:21:59] And before I’d ever become a lawyer, I’d worked in them. I just couldn’t see a path for myself, which is why I’d left and decided to do something more practical that would make money, but I just wasn’t happy doing it. So, you know, I really thought to myself, Hey, I didn’t see a future for myself working for other people in this industry, but maybe I could start the restaurant I would’ve wanted to have worked in. [00:22:18] But I really do think if these ideas, you know, they worked so successfully in the restaurant industry, which is so brutal that they will work anywhere in any kind of business. [00:22:28] When you tell your parents, and I always think it it, maybe it’s a mistake to tell relatives what your plans are. ’cause they want the best for Erin, right? [00:22:38] They want Erin to be safe and to be happy and all that stuff. What did your mom say? When you told her, Hey mom, I think I’m gonna do a restaurant. [00:22:45] Oh gosh. I mean, my parents were, they were not thrilled. I, I mean, in fairness to them, they had very generously paid for my law school education. I’d been practicing as an attorney for half as long as I’d been in law school for, I think my mom, for whatever reason, uh, it really envisioned me as a Supreme Court justice, which feels like was never gonna happen. [00:23:07] But she was really convinced that that was my future. So they were appalled, they were quite stressed out and really discouraged me from doing it. I think this happens to a lot of people. You know, my parents were both self, self-made successes and they just wanted financial stability for me. They had spent years of their own lives not being financially, they just wanted stability, safety, security. [00:23:30] And you know what? Opening a business, particularly a restaurant is anything but that. Yeah. None of the above. So I can understand it. Yeah, I can understand it, but I think from the perspective of. You just have one life to live. I mean, I’m so grateful that, you know, my rational is as wildly successful as it’s become. [00:23:45] But even had it failed, I don’t think I ever would’ve regretted doing it because I always would’ve wondered, and I think on your deathbed, you’re not gonna be like, gosh, I just had a lifetime of stability. You know, you’re gonna be like, what do I want? What did I want to try that I didn’t try? And I never wanna ask myself that question. [00:24:02] Is that the advice your friend Kate gave you? By the way, Kate, you write as a Michigander. I think all the coolest people are from Michigan. Just saying [00:24:09] it’s not giving, it’s [00:24:10] not giving away where I’m from, but, [00:24:13] but is that the advice she gave you? Yeah, so Kate is my best friend, truly brilliant woman from the great state of Michigan. [00:24:18] And yeah, I mean, we were talking about sort of what my options were when I got fired and you know, I looked at it. She was like, you know, what’s the worst that happens? And I was like, oh, I guess I fail. I’ll lose all my money. And I guess I could go back to being a lawyer. And she’s like, so wait a minute. [00:24:34] Your worst case scenario is what you were already doing. And I was like, oh, well I guess when you put it that way, it’s true. And I think realizing that I was already living my worst case scenario, made it very clear that I should take a risk and try something else. ’cause that would always be available to me. [00:24:49] But I think we’re not necessarily taught to take risks and try things, especially when there’s not a clear path to success. You know? I think that can be quite scary. [00:24:58] Well, and I think this is important for our stacker community because as you can imagine, Erin, money geeks like us are often spreadsheet nerds, right? [00:25:06] We’re gonna spreadsheet everything to death. We’re gonna make sure that we find the optimal path. And this decision was not about ROI. In fact, it’s funny, even in the small business of podcasting, which I would encourage nobody to get into, um, because you know, that’s not necessarily where the money is. [00:25:23] But when people start podcasting and their first question is, okay, how do I monetize this? Like, I think you gotta have something to say. I think it’s more about being a part of this. And I feel like for you, this wasn’t about ROI at all. In fact, you find the most expensive restaurant in town. This is much earlier. [00:25:42] Mm-Hmm. This is Mm-Hmm. I think during college, right? You find the most, you’re so passionate about cooking. You go up to this restaurant and what in the middle of the day, you just kind of knock on the door. [00:25:51] Yeah. You know, it’s interesting your question about ROI, I mean, I can’t say this would necessarily work for everyone in every field, but I can say that this has been true of me. [00:26:00] So it’s something that I can say at least can work sometimes. I have found, again, if I pursue something that’s just based on pure passion, eventually the money shows up. You know, like I did do a lot of spreadsheets preparing for homeroom, and I thought I was gonna earn $40,000 a year doing it at best. It was like quite a scary spreadsheet when at the time I was earning four to five times that. [00:26:22] And then I ended up being much more successful than I ever would’ve been had I stayed a corporate attorney. I mean, this is a similar but smaller story. Like I was approached by a great publisher to write a cookbook, which had always been a dream of mine many years into owning homeroom. And the publishing industry is not exactly like where you go, where most people go to earn a lot of money. [00:26:40] I wasn’t offered some great advance or anything like that based on the advance. Honestly, it was like not even worth my time to do. But I did it just because I thought it was gonna be fun. I just thought it was gonna be fun to write a cookbook. I always wanted to do it. And you know what? That cookbook is a super bestseller. [00:26:52] I have actually made money doing it. ’cause again, in my experience. If you really follow that passion, people follow you, people follow it. You know, there’s other mac and cheese cookbooks on the market. This one is by far the best in its category because it was written just ’cause it was fun to write. So I really do think that there is something to that and I, yeah, I went and just volunteered for free when I was in college to learn how to cook. [00:27:18] Same thing, I just was interested and you just [00:27:20] walked in the afternoon said, I will work for free. [00:27:23] Yeah, totally. I just wanna learn, and I do think for many people considering a career change or something like that, I really recommend it. Not everyone can, but it’s certainly cheaper than going to culinary school. [00:27:33] It’s certainly cheaper than getting a degree. You get all this experience and if you hate it, you, you just stop doing it. You know, there’s no, no cost other than your time, which again is valuable but not as valuable as your time plus your money, plus a long-term commitment, you know? [00:27:48] Agreed. I do wanna emphasize, and I’m glad that you emphasized in the book that going to work for free. [00:27:54] It sounds romantic. It sounds like this is going to then pave this path where Erin then has this wonderful experience being an entrepreneur. It was. It was. It was pretty rough. This idea of working for free was, was not initially phenomenal. [00:28:12] Oh no. It really sucked. I was doing a lot of grunt work and honestly not learning as much as I’d hoped to. [00:28:17] And it was a pretty sexist work environment, honestly. But, um. I do think it was still a valuable experience and it gave me just a little bit more confidence to get my next experience and then my next experience. So yeah, I think Sally, if you are interested in an entrepreneurial journey or a different career path, yeah. [00:28:35] Expecting that you take like this one risk and then it’s gonna all be magic. I mean, it wasn’t, I was working for free and it wasn’t fun and it sucked, and then I kept working different jobs and many of those sucked too. But again, I think that’s the importance of sort of getting in touch with that passion. [00:28:48] ’cause eventually that is the thing that keeps you going and keeps you wanting to learn more and wanting to persevere. Had I not loved food and not love cooking and not love restaurants, I mean, I would’ve just left after that first experience. [00:28:59] Well, well one of the things, at one of those jobs, you were making food in the back. [00:29:04] You were supposed to be hidden. Right? Nobody sees the magic. You had to be hidden. Yeah. Which you didn’t understand. You’re making food, you’re making $10 an hour. The waitstaff out front is making a fortune, serving this delicious magic that you’re helping to make. How did systems like that? Sometimes these backward systems inform your creation of homeroom. [00:29:25] I. [00:29:26] Yeah. You know, many people don’t realize it in hospitality is really, really common. You know, especially fine dining servers really clean up. They make a tremendous amount of money, but then the people cooking the food are, are making very little and for reasons that are more legally complicated than is worth getting into here. [00:29:44] But it’s a really common structure in restaurants. I just thought that was nuts. It doesn’t make sense. I, I thought if you’re gonna create a restaurant, you have to find a way to make it worth everyone’s time to be there, to make it so that the food coming out, those people are gonna be valued. And people servings times get like, you know, how are you gonna create a space that values everyone and gives them a sense of purpose and teamwork really, versus being almost like misaligned with each other and resentful. [00:30:11] I feel like because you, you had that sense of teamwork then. Ideas began coming from the team. And when people feel empowered, you know, the success then Erin isn’t just yours. It’s a success of everybody on the team. [00:30:27] Yeah, I mean, this is definitely a podcast for people who are financial geeks. Like we’re an open book management company, so taught financial literacy and shared our financials with our team thinking business is just a game and it’s about earning money, which is your goals, uh, or at least some of your goals, right? [00:30:42] And we would measure that. And a lot of other metrics that we cared about measuring that had to do with quality of life, quality of service, all sorts of stuff. And people love being part of that. It’s really meaningful to feel like you can make a difference and contribute. And most people are not asked to do that. [00:30:58] They’re asked to just turn off their brain, do what someone else tells ’em to do, and there’s nothing inspiring about that. [00:31:03] It is, it is so frustrating. The book is the Mac and Cheese Millionaire Building a Better Business by Thinking Outside the Box. And it is available everywhere, I assume. [00:31:13] Yeah, absolutely. [00:31:14] Okay. I got, I got one more question, Erin, before you go. And by the way, we’ll have a link to the book on our show notes page at Stacking Benjamins dot com. I have to go to Erin, the chef now for a second. Sure. You’ve seen a ton of macaroni and cheese, you’ve seen probably more macaroni and cheese than anybody on the planet. [00:31:29] What is one thing we could all do to make our mac and cheese taste better? [00:31:36] Oh, well, I mean, this is a very self-serving answer, but I’d say by my cookbook, I’ll teach you how to make it. But, um, uh, but the real answer is, it is worth making it from scratch. If you want it to be the best thing you’ve ever eaten, make it from scratch. [00:31:51] If you don’t have the time to do that, I would say second best, take the box and add real cheese to it. That is a secret that I did when I was like five years old, and it really amps up the cheesy factor. So that’d be my, my number two, Rick. [00:32:10] Hey there, stackers. I’m Joe’s mom’s neighbor, Doug, and man, am I hungry after Erin Wade was here. I mean, mac and cheese. I love that stuff. I mean, it’s really hard to make. It’d be way easier if somebody put that stuff in a box and didn’t have to make those tiny little noodles by hand. Man, I bet that stuff would sell like hotcakes. [00:32:30] Wait, what? It’s already in a box, huh? And look at this. Joe’s mom wrote some trivia about it too. How about that? Uh, alright. Uh, hey there, honey. I’m Joe’s mom doing all the heavy lifting today. What? That’s not fair. Here’s today’s question. What company? First patented powdered cheese. Wait, there is powdered cheese. [00:32:58] What’s next? They’re gonna tell me that the band Oasis is getting back together. Yeah, that’ll be the day. Uh, lemme keep going here. Uh, Doug will be back soon as he grabs my liver pills out of a cupboard. All right. Okay, ma, I’ll be right there. Let’s hint. [00:33:23] Hey there, stackers. I’m expert Noodler and the guy dealing pharmaceuticals for Joe’s mom, neighbor, Doug. Wow. Joe’s mom filled me in on this whole thing. Apparently you can buy noodles shaped like dinosaurs and numbers. Even Erin Wade hasn’t done that. I’ll bet. Today’s question straight from Joe’s mom. Is this what company first patented powdered cheese Stacking? [00:33:50] Apparently a ton of Benjamins in the process. It’s none other than Kraft with a K. Of course you knew that one, didn’t you? Well, stop high fiving yourself because here comes Joe and OG back to the mics [00:34:05] craft. You nailed it. I saw you talking about that just then. I saw you. All I [00:34:10] could think about is craft dinner from bare naked ladies. [00:34:14] I really like craft dinners. Is isn’t that the next line? [00:34:17] I think so, [00:34:18] but I wouldn’t have to eat craft dinners. But I really like craft dinners. [00:34:21] I wouldn’t dinner, but I really like them. [00:34:22] Oh, but imagine if you could have Erin Wade’s macaroni and cheese mixed in with your craft dinner. [00:34:27] That’d be good. I think it’s gonna go on the, uh, on the Thanksgiving menu. [00:34:32] What do you think of that idea? [00:34:33] Mac Doug? Make it at home. Uh, a side mac and cheese. [00:34:36] Yeah, [00:34:36] absolutely. I think you have to. Absolutely. And like I mentioned with Erin, everybody has their recipe. og everybody has their macaroni cheese recipe. I remember in college my roommate would throw a couple pieces of, uh, craft singles into it to make it even cheese easier. [00:34:50] Like that was his recipe. I know people, mine’s [00:34:53] hot dogs. [00:34:53] Hot dogs is a big one. [00:34:55] No, actually that’s so gross. No, but we do do hamburger. I think we were talking about this to somebody. [00:34:59] You make it like Hamburger helper tastes a little bit like Hamburger Helper. [00:35:02] Yeah. Yeah. [00:35:03] Dunno why they call it hamburger Helper. [00:35:05] Stands up a little hot sauce. Nope. Bridge too far? No, just, just a lit, not, you know, just a, I just can’t do it. Yeah, just a little. I have the blandest pal in the [00:35:16] world. I can’t, says [00:35:17] the guy who just ate gerbil. [00:35:21] It was Guinea pig, whatever it was, Guinea pig. However, it’s a good time. Big thanks to Erin Wade. [00:35:28] Let’s get into today’s headline. [00:35:30] Hello Darlings, and now it’s time for your favorite part of the show, our Stacking Benjamin’s headlines. [00:35:37] Today’s headline comes to us from MarketWatch, is written by Vanessa Wong. Before I get to the headline, because this is a little, um, niche headline, I wanna pivot to exactly what this piece is about, og, but in case you were living under a box a couple of weeks ago, under a box under a rock, uh, in a cave somewhere. [00:35:57] Somewhere, yeah. I feel like Dr. Seuss in a cave with a nave. The Federal Reserve got its benchmark interest rate by 50 basis points two weeks ago. [00:36:07] That’s a fancy way of saying half a percent. [00:36:09] Yeah. All the jargon we use really drives me cra2y. So, 10 basis points, og then that means that’s one 10th of a percent right? [00:36:17] It’s just a lot easier to say 50 basis points. Oh, no. If you’re, uh, on CNBC than it, than saying one half of 1%. I don’t. [00:36:27] And a normal cut though is a quarter percent. So when the Fed gets together, they look at all of this stuff and there’s, there’s kind of this misconception that Jerome Powell, the Fed chairperson is responsible for all this J Powell. [00:36:43] Yeah. As friends like us call him. Yeah. J Powell and his homies, they get together Mary [00:36:51] Band of, uh, rate cutters. [00:36:55] Yeah. And he’s got these Fed Governors from all over the nation. So it’s not Jay Powell voting, it’s everybody voting. All of these very smart people. Mm-Hmm. And they all vote whether to cut rates. [00:37:06] And I believe this was either unanimous or there was one dissenting vote. On this vote to cut rates by half a percent, but when you’re cutting rates by half a percent, let’s talk about this. Why does the Fed do that? First of all, for all of us that don’t really know how this stuff works, why does the Federal Reserve cut interest rates by half a percent? [00:37:25] Well, the loosening or tightening of credit, whether it’s half a percent or 1%, or 25 basis points, or a quarter percent, whatever, it all has to do with trying to keep the economy growing at a pace that they believe is the reasonable pace. And, and the government tries to target an economy growing at somewhere in like the three to 5% range. [00:37:48] 4% is their number. While maintaining a reasonable unemployment, which actually reasonable unemployment, it’s not zero. It’s, you know, six or 5% unemployment. That means that there’s just enough opportunity for turnover and so and so forth, and, and way smarter people than me have decided that that’s a healthy economy. [00:38:08] So if things are growing too fast, if the economy’s doing too well, which is kind of silly to say, right? Well, why? Why would it matter if it’s going too well? Well, we see the outcome of that. If there’s so much money and so few goods and services, people will pay any price to get the lake house. People will pay any price to buy a car. [00:38:27] People will pay any price for groceries. ’cause they have so much money they don’t care. Or it’s very inexpensive to borrow money. And so they don’t care. Oh, I just, you know, I’ll just get a HELOC on my house. It’s whatever, you know, 3% I’ll refinance my mortgage to pull cash out. It’s 2.75%. That’s how many times do we hear that’s cheap money. [00:38:45] That’s a really good deal. And then what happens is the price of things start going up. That starts to impact people’s wallets. People start buying a little less, the economy starts slowing down because we’re not buying as many cars, we’re not buying as many new houses. We’re not buying as many goods and services because it costs money to do that now that we might be running low on, or it’s expensive to borrow, and now the economy starts to tighten a little bit, and then that’s bad, right? [00:39:13] Because then growth isn’t happening. People start getting laid off. Then the Federal Reserve and their broad discretion would say, all right, well, let’s make it a little easier for people to borrow money. And companies for that matter, you know, for anybody to borrow money to maybe entice them to say, oh, well, if I can borrow money a little cheaper, maybe I will build that new factory now, or maybe I will do that other project at my house that I was looking at. [00:39:36] So it’s just this constant cycle of tightening and loosening to try to manage that without making it a giant jerk in the wheel, one direction or the other. And I think a lot of people thought, I. Over the last couple of years that the hard part was gonna be to kinda moderate the inflation without causing a recession. [00:39:55] Because generally speaking, the cure for inflation is a recession. That’s what’s happened in the past and in some areas of the economy. In some areas of the country, people would say able to, I don’t know if you’ve been in my backyard, but we are having one. And that’s true in certain areas for sure. I think there are certain areas of the country that are still doing really well, but that was the big challenge that I think the Federal Reserve was trying to do was slow the economy kind of post covid, slow the economy such that it didn’t cause a recession, because that’s the, you know, that’s the next problem. [00:40:28] But just slow it enough that they can kinda get the boat back on plane and then, and then they can, they can lower it. And I think everybody seems to think that they did a fairly decent job with that. It, [00:40:38] it’s funny, people don’t, um, people are surprised that the Fed only has one lever. They only have one lever, and that is this very short duration. [00:40:49] Interest rates between banks, putting liquidity and taking liquidity out of the banking system by raising or lowering interest rates, truly is the lever that they can play with. And this interest rate, when we hear a quarter point, I think people are also surprised. og, this isn’t directly to you, it’s just between banks and banks Just pass it on. [00:41:13] They pass some of it on. What’s really interesting is, I don’t know, I, I was very particularly interested in this, so it was a Wednesday. Yeah. I think when the announcement came on Wednesday night, I got an email from our bank that said, Hey, by the way, starting tomorrow, your savings account rate goes from five to 4.5. [00:41:32] Ah, okay. I mean, I get it right. They had that email written. Yeah, it was in the can. As they said, we passed it on, so. Okay, cool. So I also logged into my line of credit and I went, oh good. That should drop from nine to eight and a half too. Yeah. Ah, no, that’s still at nine. Huh? Weird. This is like [00:41:48] gas prices, you know what I mean? [00:41:50] Yeah. When, when you see the price of oil change, very quick to go up, very slow to come back down, [00:41:56] slow to go the other way. So as a result of this, if you have that, if you have borrowings out there, that on is on a variable rate. I think you’ve got a little bit of fuel right now because credit card companies, banks, lending institution, they’re, they’re not, you know, on that variable rate. [00:42:14] They’re not, they’re not ready to, they’re really give in yet. They’re, you know, they don’t have to, there’s not the market forces to do that. So think about that from an economic standpoint. If you’re American Express or you’re a visa. Until you start losing assets right. To a 0% rate or, you know what I mean? [00:42:29] Mm-Hmm. Until somebody starts pulling their accounts, you’re like, well, these idiots wanna pay us 25%. I guess we’re at 25%. We don’t have to really do anything about it. And this is [00:42:37] where competition comes in. And this is where our stackers, where you’ve gotta be aware of this stuff because if your line of credit doesn’t go down right away, and let’s say it stays higher, some other bank is responding right away to grab new customers. [00:42:53] Absolutely. So this is an opportunity for you to lower your rate by moving the ball? [00:42:56] Absolutely. Well, in my personal example, so we have a line of credit and there’s a balance, and I waited to see if it didn’t change. I’m waiting till the end of the month to see, but I checked online to see what their new rate is for new customers. [00:43:10] And so I can see that their new rate for new customers is that eight and a half. And so I’m gonna give ’em till the end of the month to make the adjustment. And if it doesn’t, then I’ll call and say, I. You need to change me to the new customer rate, or I’ll just, to your point, I’ll just do the paperwork over at the next bank and pay them eight and a half instead of you nine. [00:43:27] You know, it’s, it’s easy for me to do that paperwork. It doesn’t cost anything to do, you know, it will save me a little bit of, uh, of interest payments. So if you have credit card debt, if you have a line of credit or something like that, you have this leverage right now to call and say, Hey, I need, you guys ought to work something out. [00:43:43] You know, and you’ll pro you’ll probably start seeing some promotional rates from companies targeting you if you, you know, if you have that, uh, stuff going on in your life. Yeah. [00:43:54] It grabs some business. This is where capitalism works. [00:43:57] I just wanna add this too, maybe Kevin can throw this in the 2 0 1, uh, Ray Dalio did a really cool video probably about 10 or 15 years ago called How the Economy Works. [00:44:08] It’s like, remember those videos was like the little drawings, those were kind of all rage. Oh yeah. Everybody was doing charact those 10 [00:44:13] years ago. [00:44:14] Yeah, it’s kind of like that. It’s not, the characters aren’t moving or whatever, but it’s a little bit like that and I think it’s maybe 10 or 15 minute video and I think it’s a pretty fair preview, if you will, or a fair understanding of like, here’s how the banking and the economic system works with money and interest rates and, and that sort of thing. [00:44:32] I think we’ll link it in the 2 0 1 and, um, give credit to Ray Dalio for putting that together. I think it’s kind of an interesting video for people to look at. [00:44:40] When you talked about rates. You know, we talked about line to credit, credit cards, auto loans we didn’t talk about, but those also respond directly to Fed moves. [00:44:51] Your savings account should respond. We saw when savings account rates went up, bank of America even said publicly in their quarterly earnings call. If you remember, og customers are demanding it, so we’re not gonna pay you higher on your savings. Which yeah, we talked about for a long time was a huge opportunity for all of our stackers to go get a high yield savings account and actually get some of that cash reserve, that emergency fund working. [00:45:15] When it comes to home loans, though, home loans don’t directly respond to this. Home loans deal with, instead what’s going on with treasuries. But OG, in most circumstances, you will see treasuries respond to what the Fed does. And I don’t think this is gonna be any exception to you. I mean, a half a point drop is really a big drop. [00:45:35] Well, you’re right. The interest rates on your house generally are fixed anyway. Maybe if you have an interest only mortgage or something that might be some variable rate, but you don’t really see those very much anymore. And so to take advantage of any interest rate changes on your primary mortgage would require you to refinance. [00:45:53] But you know, an interest rate change like this is more to spur new activity. So you think about the people that are staring down the barrel of having to move. Across the country for a job or a family situation or take care of loved ones or whatever the case may be. And they’re going, why I can’t, I can’t move from this city to this city and get the house that I kind of wanna live in because interest rates are so high and I’ve got, my payment here at this place is at 2.75%. [00:46:20] So I have a really fancy, big old fancy house in Texas. I can’t move back to Michigan because I gotta pay 8% to, to get a loan in Michigan. Well now if it’s, the interest rates have come down, that adds purchase ability, so to speak. And so I don’t think that it’s gonna really affect people who have their existing house. [00:46:39] Although I guess technically if you’ve purchased in the last year and a half, you might consider refinancing, but I probably would wait anyway frankly. But if you’re kind of forced to your, your hand has been forced in terms of moving or downsizing or maybe you have to upgrade even. Yeah, some lifestyle change. [00:46:55] This kind of spurs that new activity, I think, because now. Your house is at five and a half instead of six and a half or six and a quarter, whatever. I [00:47:02] think real estate wise, a lot of people wait for a rate adjustment before they jump into the market. We should see, you know, in some portions of the country, we saw the real estate, uh, market slow a little bit. [00:47:15] This speeds up the game, which by the way, if you’re a real estate investor, you shouldn’t wait for these drops because while you’re gonna pay less in terms of a mortgage, to your point, you could have refinanced and high rates chase away other people bidding on properties. So you may get a better deal on the property while rates are high because there aren’t as many bidders and people have to move To your point, if I, if I get a job across the country, I can’t wait to see what interest rates happen. [00:47:41] I gotta sell this house now ’cause I don’t have the liquidity to own two. So if you’re a real estate investor, buying when they’re high and then refinancing to lock in a lower rate later makes a bunch of sense. I. [00:47:52] Well, when it comes to interest rates on your house, there’s a couple of other things that you can, you can levers you can pull that will help drive that rate lower. [00:48:01] And it’s obviously gonna make a lot of sense here, but as a, for instance, I just put in a 20% down mortgage in Texas. For a $500,000 purchase in your credit score is seven 20. A 30 year fixed right now is 6.886. That’s kind of the average rate. If you jump that down payment to 25% and maybe your credit score is seven 60 instead of seven 20, that rate goes to 6.2. [00:48:29] Yes, that means more money outta your pocket, which makes sense that the rate would be better ’cause the bank is taking less risk. But also your credit score. So there’s a couple of other things that you can do to make yourself look a little bit more presentable. Mm-Hmm. As it were. When you submit your application and maybe, you know, 5% on a 500,000 loan, still 25 grand, that’s not a zero down payment. [00:48:50] That’s a pretty sizable check that you write. But contrast that against the interest rate difference between 6.2 and 6.9 over your lifetime. I bet I’m not gonna do the math, but I bet that that’s a better deal for you. It’s a [00:49:03] ton of money over 15, 30 years. Uh, [00:49:05] yeah. To save and adjusting your credit score. [00:49:07] There’s things that you can do to really almost immediately manipulate that to look better if you’re going to be applying for debt. [00:49:13] What are a couple of those things? [00:49:15] Oh, very simply, you know, obviously you can have, you can never have a late payment. So if you have any late payments that just kind of hoses you for two years, never have a payment late by 30 days. [00:49:26] The second thing is, the biggest lever is your utilization, which is basically just the calculation of how much money you owe on your credit cards in total. Divided by the available credit. And you can manipulate this right, by asking for a credit line increase. You have a $10,000 limit and you want, you can get it to 15, you get a new credit card. [00:49:46] Now that’s negatively, uh, that has a negative connotation if you’re trying to get new debt a whole bunch. So you gotta be careful with that. If you have a $5,000 credit card bill, even for somebody who always pays off their credit card, your credit report will show the $5,000 due as of the statement date. [00:50:05] So that’s when the credit card companies usually report your balance to the credit bureau is the day that the statement is cut. So let’s say that you have a $10,000 Costco card, ’cause you like your Costco points or rebate, and every month you put 5,000 on it, you’re living expenses, five grand. You go, I paid off. [00:50:20] I never have any interest. Well, the problem is, is according to the credit bureaus, you’re 50% levered, right? Even though you pay it off. So go get, you know, ask Chase or ask, in this case, Citibank, say, Hey, can I get a credit line rate increase to 20,000? Even if, you know, just still use your five now your 25% lever, not 50. [00:50:39] And the downside with this obviously, is [00:50:41] you gotta know yourself. ’cause back in the 1990s, a hundred percent, if I would’ve asked for a credit loan increase, they would’ve given it to me because Bank of America’s handed me a shovel so I can build myself a grave. Yeah, keep digging. Yeah. Oh, I would’ve spent every dollar of that. [00:50:54] I’m like, I tried to get on levered by increasing my credit. What happened? Well, I spent it all. [00:50:58] Weird. Yeah. Weird. Yeah. So, yeah, a hundred percent. The biggest thing here is you gotta know yourself, but if you can add a line of credit, add a credit card that has a zero balance. Technically, this is the weirdest thing. [00:51:11] If you want the highest credit score possible, assuming that you don’t have any, as it relates to your credit card component of your, of your credit score, the highest credit score possible is. A $2 balance on your statement day. So in that example where you have a $10,000 credit card limit, you put 5,000 on your credit card every month, and you pay it off every month. [00:51:35] If you’re gonna apply for new debt, if you’re gonna go get that house, pay $4,998. That’s funny. The day before this, I’m not joking. The day before the statement ends. So you’re paying it early, right? You haven’t even got your statement yet. [00:51:50] Yeah. Yeah. So you’re not gonna pay interest on that $2? No, you’re not even [00:51:54] paying interest on it. [00:51:54] You’re still paying interest, period. I’m saying like your statement ends on September 30th and they go, it’s due October 29th, that period. Pay it on September 29th. All but $2, your credit score will skyrocket and then go get your mortgage loan and then go back to living your life. [00:52:13] I want to pivot just briefly to this, uh, piece, because the piece is about actually cars and we mentioned that interest rate, big cuts like this. [00:52:23] A lot of people have been apparently waiting on the sideline to buy a car because car prices have, uh, gone up huge the last, uh, four years. In fact, the average payment on a car is up 28% compared to four years ago. The average person right now, OG, has a monthly payment of $737 on their car. Wow. Because of that, because cars have become so unaffordable, the average age of cars just hit a record in 2024. [00:52:54] 12.6 years old is the average car in America, 12.6. I’m so [00:52:59] glad Texas got rid of their inspection requirement. [00:53:02] Everybody’s driving a crappy car and, but [00:53:04] not the fee. Yeah, [00:53:06] exactly. But even though interest rates are following people in the auto arena, car industry experts say lower rates are not going to have a significant impact on overall affordability. [00:53:18] Especially true for consumers with low credit scores who still pay higher rates because of the fact that uh, cars are just so hard to come by right now. People really out there buying well [00:53:29] in the car world, you know, if you’re being forced to purchase a car, obviously the best thing is to buy a slightly used one in terms of that depreciation curve. [00:53:37] But if you’re gonna buy a brand new one, I feel like right now you have to be a little brand agnostic. You know, just ’cause you’ve always had a Ford. Ford may have crappy, I, I mean, I see these ads, I know everybody does, and it’s like, get a new GMC pickup truck for 0.9 finance. Like some companies are still doing it, whereas Toyota might be like, Nope, pay seven. [00:53:59] Yeah. You know, and you’re like, well, I guess I like GMC. Now. It’s like, you know, at the end of the day you have to, unless you work for one of these companies, I suppose if you’re being forced to shop, I, I, I believe you have to, you have to be a little bit open to different brands than maybe you would’ve normally shopped because you might find the deal in terms of the, in terms of the debt service at a company that you haven’t done business with before. [00:54:24] Because all of the things we said at the very beginning, they’re trying to scoop up customers right now. Right. They’re like, we need to sell cars. We don’t give a crap if we sell ’em at 3% interest or 7% interest. We just need to sell these s we gotta move. Absolutely. So, you know, let’s get some turnover going. [00:54:39] Well, and to your point. Shopping around is really gonna pay because there’s one of the biggest differences ever between the average cost of a new car and the price. People told Edmonds the big car deal company. Mm-Hmm. How much they want to pay. The average new car costs 47,870. The average almost 50 grand is the average price of a new car. [00:55:02] 50 50 bands, as the kids would say, [00:55:05] that was so expensive. [00:55:07] That was just, it is expensive, not was, yes. [00:55:10] Yeah. A year’s worth of pay, bro. Yeah. I just think 50,000 when I was God, when I was even in my, [00:55:15] what we need is, we need every stacker to send us 50 cents. That’s it. So that you and I could get a new car there it is. [00:55:24] Crowdsourcing the step in Benjamins mobile, crowdsource [00:55:27] our new next new car. But the average person, what did the average person tell Edmonds very seriously that they want to pay? [00:55:35] Oh, 37. [00:55:36] 30 [00:55:37] 30 [00:55:38] on the nose. Yeah. 47 8. Versus 30,000 is what people wanna pay. So shopping around, there’s companies obviously are seeing this, this, so you’re, you, you’re gonna see poss. [00:55:49] I love the idea of being brand agnostic. Uh, you mentioned it before. OG people can, uh, if you’d like to dive more into interest rates and how they work this car issue, Kevin, our brilliant writer of the 2 0 1 on Tuesdays and Thursdays talks about these in much more detail. Stack you Benjamins dot com slash 2 0 1 to continue this conversation for free and in writing, we have the ferrets, deliver it to your mailbox. [00:56:15] Write every Tuesday and Thursday. If you’re not here though, because you’re worried about interest rates, you’re worried about having a plan that actually works, oh, G and his team are taking clients. So head to stack your Benjamins dot com slash og and that gets you on his calendar. It’s time to get things done here before the end of the year. [00:56:35] And I know OG when it comes to, especially with new client meetings, you kind of wrap up the year early. So you’re probably not gonna be doing this for much longer, I would imagine. [00:56:43] Well, God willing, I’m doing this for much longer, but, uh, [00:56:47] I mean in 2025, I mean 24, you might hit the pause 2020 until [00:56:51] January. [00:56:52] Well, we believe that family time is super important and, uh, free days for our team are super important. So we do kind of ratchet it back. I have had people call me and say, Hey, um, so I looked at your calendar. There doesn’t seem to be any availability until. February. So if you see that, just send me a note and we’ll figure something out. [00:57:10] There’s, there’s a lot of moving parts going on right now with, uh, kid stuff and varsity football and holy cow, Coco, and, and, uh, you’re at that age, man. All, all those things. I remember those days and I was recruited to be the. Scoreboard operator for middle school football at our kids school. Oh, excellent. [00:57:27] It’s mostly because I yell a lot and they’re like, let’s just put OG in the booth. We’ll close the window. Sir, why don’t you, you, you’re really good at this. Why don’t you come do this thing up here? It’s really quiet and it’s air conditioned, and you can just sit there by yourself and not offend anyone [00:57:43] and just cool off. [00:57:44] Stacking Benjamins dot com slash OG is where you go to start that conversation. Yes, please. All right, let’s mosey out onto the back porch for just a moment. I am going to last minute here on Thursday, be in Cleveland. Cleveland. I’m coming back to Book House Brewing. I loved it. Last time we’re gonna have another, another meetup where we talk about, uh, a headline. [00:58:07] We had such a great conversation when I was in Cleveland this summer, but I will be back this weekend. So time for us to get the band back together, Cleveland. ’cause Cleveland Rocks, Stacking Benjamins dot com slash meetup gets you to the Eventbrite signup page. Of course, tickets are free, but come join us for 50 cents, dude. [00:58:25] For a, for a foamy B, we gotta get the card going right. It’s, it’s 50 cents. We can crowd code every stacker. Give us [00:58:31] 50 cents. We would have enough for the Stacking Benjamins mobile, so you [00:58:34] could crowdsource Rx car. [00:58:36] We’ll even put that, uh, new logo on the side. It’ll be hot. It’ll be a [00:58:39] 87 Pontiac, as the kids [00:58:41] would say. [00:58:42] How’s the drip? [00:58:45] It’ll be a 87 Pontiac Aztec. Remember the Aztec? Yes. [00:58:49] My grandma had one. Did they make [00:58:50] those in 87? I don’t think so. Nineties. That was more of a nineties car. I thing. Yeah. [00:58:54] How about a Saturn? [00:58:55] Uh, Stacking Benjamins dot com. Saturns slash meetup. Saturn line. I like, I had Saturns. I like Saturns. [00:59:01] Come join us Cleveland. By the way, we also had, well, you know what? Doug had to step out. Uh, I want to save the other. We got a great note from a stacker about music and, uh, our, our discussion about concerts. Ah, yes, indeed. We need, we need Doug here for that one. All right. That’s gonna do it for today. Uh, Doug though. [00:59:19] There you are. Hey, we were just talking about you now. Let’s go ahead and close it in a good way this time. Yeah. [00:59:24] Uh, Doug for the first time ever. What, what [00:59:28] Doug, take it from here man. What should we have learned today? [00:59:30] So what’s stacked up on our to-do list for today? First, take some advice from Erin Wade. [00:59:36] You create the vibe when you’re an entrepreneur, but also even when you’re not, want work to be more rewarding. Think like a woman making macaroni and cheese for a living second, with interest rates slashed. Look for opportunities with your mortgage, maybe with real estate, maybe, and also with your debt. [00:59:55] Definitely it’s time to get your debt strategy together, stackers. But the big lesson, if you wanna get on Joe’s Mom’s good side, or heck, even my good side. Just bring over mac and cheese and double up on the cheese. I mean, am I right? Thanks to chef and entrepreneur Erin Wade for joining us today. You’ll find her new book, the Mac and Cheese Millionaire, building a Better Business by Thinking Outside the Box wherever books are sold. [01:00:24] You know what? We’ll also include links in our show notes at Stacking Benjamins dot com. This show is the Property of SB podcasts LLC, copyright 2024, 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. [01:00:50] 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 Moms Neighbor, Duggan. We’ll see you next time back here at the Stacking Benjamin Show. [01:02:02] Oh gee, [01:02:03] we do TikTok minutes on, uh, Wednesday normally, but I saw this one as uh, two guys who are ordinary guys. This is if normal dudes. We’re forced to do press conferences. I think many of you will appreciate this. And this is the gentleman you can see on the screen. OG is sitting down in front of a microphone to get ready to begin his post-game conference as a normal dude. [01:02:31] Hey guys. Melissa, can you talk about your decision just before dinner to blow up the downstairs bathroom right next to the kitchen where your wife was cooking instead of doing the considerate thing and going upstairs? Sure. Um, considerate. Yeah, I guess I would probably, it would’ve been considerate to go upstairs. [01:02:51] Yep. And this one’s weird to to, to explain honestly, and I think it’s hard for some couples to understand, but there’s this innate masculine gratification you get when your partner is forced to. Marinate in a stent you’ve created all on your own so bad. And it sounds kind of weird saying that out loud. [01:03:12] And honestly, I’m not even in love with the fact that I love it, quite frankly. But there are certain primal desires as a husband that I am in no position to ignore. Um, and nor do I think it would be healthy to do so. Um, does that make sense? Not really. Well, not everything does. So any other questions, guys? [01:03:35] Alright. [01:03:36] Appreciate Andy said he’s off the stage. [01:03:38] Hmm. [01:03:38] If normal dudes had to do a press conference, what, what would you have to do a press conference for in your family? [01:03:44] Oh, that’s a good question because [01:03:45] I don’t do that. I do the considerate thing usually. Did you hear that joke about the dude that goes in to interview for the job and the, the person hiring says, what’s your biggest fault? [01:03:58] Mm-Hmm. [01:03:59] And the, the guy interviewing goes well. I think I’m just too honest. I think that’s the problem. I’m, I’m just very, very honest and the person goes, well, I don’t think that’s a fault. I don’t care what you.
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