What are the most common ways people shoot themselves in the foot (financially-speaking)? Here to tackle that very question is our expert panel of contributors: from Afford Anything, we’re joined by Paula Pant; from the aptly named award-winning blog LenPenzo.com, Len Penzo joins us; and from across Joe’s card table, the man, the myth, the legend OG makes an appearance. Will Len lock secure victory for the year-long trivia game, or will Paula or OG stay in the game?
In the second part of the show, sponsored by DepositAccounts.com, our panel rounds out their top 10 financial mistakes.
As we enter the last month of the year, Doug brings some Christmas tree-themed trivia. Can Len score an extra point, bringing him one step closer to victory? Will OG defend his title and take the W? Will Paula continue her unlikely come-back rally? Tune in to find out!
Deeper dives with curated links, topics, and discussions are in our newsletter, The 201, available at https://www.StackingBenjamins.com/201
Enjoy!
Watch On Our YouTube Channel:
Our Topic: Our top 10 Financial Mistakes
Top 10 Most Common Financial Mistakes (Investopedia)
During our conversation you’ll hear us mention:
- Not getting your full 401(k) employer match
- Not paying off credit cards; “living on borrowed money”
- Not budgeting your expenses; “not having a plan”
- Not having enough insurance
- No emergency fund; “living paycheck to paycheck”
- Not adequately planning for the long-term; “not investing for retirement”
- Taking cash out during a mortgage refinance; “using your home equity like a piggy bank”
- Not being on the same page as your spouse or partner
- Replacing your car too often; “buying a new car”
- Not having an estate plan
- Co-signing for a loan
- Excessive and frivolous spending
- Never-ending payments
- Paying off debt with retirement savings
- Spending too much on your house
Our Contributors
A big thanks to our contributors! You can check out more links for our guests below.
Paula Pant
Check Out Paula’s site and amazing podcast: AffordAnything.com
Follow Paula on Twitter: @AffordAnything
Len Penzo
Visit Len Penzo dot Com for the off-beat personal finance blog for responsible people.
OG
For more on OG and his firm’s page, click here.
Doug’s Game Show Trivia
- How tall is this year’s Rockefeller Center Christmas Tree?
DepositAccounts
Thanks to DepositAccounts.com for sponsoring Stacking Benjamins. DepositsAccounts.com is the #1 place to go when you’re looking to see if your rate is the BEST rate on savings, CDs, money markets, and even checking accounts! Check out ALL of the rates ranked from best to worst (and see the national averages) at DepositAccounts.com.
Mentioned in today’s show
Join Us Monday!
Tune in on Monday when you’ll learn how to be a better leader in your family or your team with the President of Think 2 Perform, Chuck Wachendorfer.
Miss our last show? Check it out here: Navigating Important Conversations, Small Talk, and Holiday Parties (SB1442).
Written by: Kevin Bailey
Episode transcript
You stink. I think you’re gonna have a good Christmas, alright? You smell like beef and cheese, you don’t smell like Santa. You sit
on a throne of lies.
Live from Joe’s mom’s basement. It’s the Stacking Benjamin
Show.
I’m Joe’s mom’s neighbor, Duggan. Today we are talking top 10 financial mistakes with our team of amazing contributors. Let’s meet ’em now. First, say hello to the only Paula that’s cooler than Paula Abdul, Paula Pant. Also on the show, you know him, you love him, kinda, it’s O. G. And the man, the myth, the legend, oh wait, it’s just Len Penzo.
But that’s not all. Halfway through the show, I’ll share my Arbor esque trivia question. And now, a guy who brings you the best personal finance advice all year long. And today… He’s bringing it live from YouTube. It’s Joe Saul
Sehy.
Hey there, stackers, and happy Friday to you. And, uh, Len, I didn’t see your sign.
It was backwards, by the way, Len. You have to write it backwards. Which really only
drives home the point. I read it. It said. I read it too,
but it was there you go here by mistake. Is that better? Super for people not on YouTube with us. Welcome to the, I caught a fish this big podcast. We’re going to have some fun, have some fun today, and we’re going to make sure we include all the audio listeners because today is a great day.
It is game show day, which means not only are we going to give people a point for that in our big year long competition between our contributors, but also. At the halfway point of our game show, we still have Doug’s normal trivia. So it is a two point day with only, only three weeks to go. And the score, Doug, the score is looking, score’s looking pretty good.
Who’s in, who’s in third place right now. Well,
right now, do we have a tie for third
place? Oh, I think we do. Well, I think we called a tie for second. We can only have a tie
for second.
Well, that, okay, so first loser. We have a tie for first loser, is what we have. Both Paula and OG are sitting on lucky 13.
How is Paula tied with OG with three weeks to go? We’ve had a lot of guests sit in for Paula. Paula, what the hell’s going
on there? Oh, well, you know, it’s finally my time. Finally my time.
Well, it appears it’s not your time because… Somebody else is three points ahead of everybody. And by the way, if he wins it this week, if he wins both points this week, he can lock it in.
Mr. Len Penzo. Len, after OG having the crown for two years, you could get it back today.
I will not count my chickens before they hatch. Absolutely not. Got some good, uh, competition here. We got, uh, even Paul has stepped up her game and, uh, so, you know, you never know. You never know. And you know what? These game shows are, I hate them.
I hate them because I come up with good answers all the time and the
article writers don’t know what come up with good, quote, good answers, but they never
heard the piece. What I love about this is he’s blaming the article writers, Joe, and not you and I who are the judge of his answer. So let’s just run with it.
Let him go with it. Yes. Distracted.
By the way, you were talking about counting your chickens. Len, did you hear why the chicken crossed the road? No,
Joe, why did the chicken cross the road? Hey, Joe? Yes? That was good. But I’ll give you the real reason why the chicken
crossed the road. Oh my god, that’s so great.
Oh, that was so great. We got Paula, we got Len, we got OG, we got Doug, we got Game Show. So let’s go. You guys know what that sound is. That’s our Game Show music, which means we have another topic, and the topic today As Doug said so eloquently in his open, is these are, let me make sure I get the wording right, because I know what sticklers you guys are, uh, these are the 10 top 10 most common financial mistakes.
Top 10 most common financial mistakes, and for people that are new to our game show format, Uh, we found a piece in the common media. We won’t tell our contributors have no idea what piece it is to lens point. Sometimes these pieces are fairly bad and that’s why we pick them sometimes and other times they’re fantastic.
What I like is we always get great stuff from all three of you no matter what. And we get some pieces. We get to talk about the stuff that these financial writers wrote. So we end up with some good financial advice for everybody. During the course of the next 45 minutes. So we are going to go in Opposite order Paula because of the fact that you finished third last year That means with ten on the board you get the most likely chance to get one of these so for one point What is one of the top ten most financial?
mistakes according to this unnamed
piece. One of the top 10 most common financial mistakes. Most common. Not getting your 401k match or your full retirement
match. Is not getting your 401k match one of the top 10 mistakes?
Wow.
It
is not. Wow.
Damn. Wow, whew, I had that one on my list. Thanks, Paula,
for taking it on.
It’s on the list, Paula, but they just didn’t have the K written in there, so
we can’t give it to you. I did say
retirement match. Actually, no, no, Doug.
It’s totally not on there. It’s not even close. She wasn’t even in the ballpark. But, talk about why that would be a huge mistake anyways, Paula. Oh,
Doug.
Well, part of your compensation as an employee is the retirement match or the retirement benefits that your employer gives you.
And so if you opt to not take part of your compensation, then you’re just turning away part of your compensation. Like, why would you turn that away? And notice the way that I just described that. There are other people in the financial space who will say that you are turning away quote unquote free money.
It’s not actually free money. This is part of your compensation. This is money that you are earning for the work that you’re doing in order to collect this particular amount of money, you have to meet a certain condition. And so by failing to meet that condition, you are not collecting your full compensation.
It’s sadly, it’s an easy one to meet. Right.
Is that condition showing up for work?
I mean, that’s. Necessary but not sufficient.
Yeah, when I say easy one to meet, by the way, I don’t mean that everybody has the money, certainly, to be able to save to get the match. So I don’t mean it’s easy that way, Paula. I just mean that, that, hey, it’s free, right?
So if there’s some other priorities, maybe something else on this list. that you can do a better job on, that’s a easy win. You don’t get a bet on the stock market, you don’t get a bet on anything except your employer to actually put it in the
account. Right, and if you think about it, if by virtue of putting in one dollar, your employer also puts in another 50 cents or another dollar, that is the only quote unquote guaranteed return, risk free guaranteed return, that you will ever make in
the markets.
It’s a fabulous return.
50%. Hundred percent. Hundred percent
percent. Yeah. Yeah, that’s a hundred. Well, depending on if it’s dollar for dollar or 50 cents a dollar. I mean some. Yeah, some are are not as great one, but yeah, still point taken. All right. Paula doesn’t find one on this list of 10 og. That means the board is still completely clear for you, brother.
Wow. Okay. So I actually had not maxing out 401k or not contributing to 401k. Also,
well, the, well, to be clear, she didn’t say those. She said not getting the 401k
match. I meant match. Get the match. Yeah, that’s what I meant to say. Uh, nice try. I’m not getting tricked into saying, Oh, max a 401k then, huh? I’m gonna say, Hopefully this is low hanging fruit here.
Consumer debt, credit card debt. What is, what is consumer debt? What is credit card debt? I don’t know the proper phrasing to make sure I get all the points.
Be as broad as possible.
Oh, I’m
sorry, you didn’t use a gerund in
your answer,
so. Is that, is that debt with an apostrophe? Is, uh, is using, what is it, not paying off your credit cards?
I’m
just saying, just having credit card debt, so yeah, that could be paying off however you interpret that to begin with, is the way that I meant it. Is
it on there? It is on there, and they have that classified as living on borrowed money. this piece. Yes, that’s what I meant to say. Yes. Using credit cards to buy essentials has become somewhat commonplace, the writer says.
But even if an ever increasing number of consumers are willing to pay double digit interest rates on gasoline, groceries, and a host of other items that are gone long before the bill is paid in full, it’s not wise financial advice to do so. Credit card interest rates make the price of the charged item a great deal more expensive.
In some cases, using credit can even mean you’ll spend more than you earn. You’ve seen this before, OG. People just
being upset. I’ve done this before. I mean, twice. It was awful both times. I was just having a conversation with somebody the other day who, uh, settled a lawsuit and, uh, a little, a little extra money, not like settled a lawsuit, like.
You know, I got bajillions of dollars lawsuit, but you know, a sum of money. And the person was like, well, what should I do with it? I said, have a credit card debt. Well, but there’s Christmas coming and I want to go on vacation. But the answer is, is that if you do that in a year from now, you’re going to have the same credit card debt.
You’re just not going to have the money anymore because it’ll just slowly kind of filter away. At least if you zero out all your credit card debt for the time being, you’re debt free and you can kind of reset your life. So paying off your consumer debt, almost any interest rate. is the best deal possible.
You know, I’ll get into some arguments with people about, but my car loans at 1. 9, should I pay? I still think you should probably pay it off just because of the cashflow aspects of it and the opportunity cost of investing elsewhere. But, um, nevertheless, if you have consumer debt, Lord knows it’s at 30 percent these days that needs to be paid off.
Yeah.
Huge, huge downside to living on borrowed money. OG gets the first point on the board, Len, to end round one. We got nine left. What are you thinking?
Can I, let me ask you a question. Are you doing this one point, then two points, then three points, or are these all just one point, regardless
of what round?
No, one point, then two, then three. Yeah. So if you’ve got a really good one, you want to risk. Yeah, there’s
one that’s kind of out there, but I think it. Okay, I’m going to go with the obvious one, since it’s only worth one point, the Jeopardy 200 question. And boy, this better be, this better be on there or
not.
There’s a huge part of me now, Doug, that hopes it isn’t. Me too. I know.
Okay. This is like 101, right? This is personal finance 101. Not budgeting your expenses. Planning out your, you know, your income and your outgo. Uh, the
judges are not, are not impressed, Len. I gotta be honest. There’s, there’s a big, there’s some big hesitation going on.
Uh,
I’m, I’m a little, I want to say no so badly, Joe. But what do you think? It’s pretty close to the first one, to number
- Ah, there’s some dissension in the ranks even. Say that again.
This is great for us. Say that again, Len.
Budgeting your income and your outgo, not, you know, I’m going to do this as broad as I
can.
I was going to say, I love the game within the game. Like, basically making a f Financial mistake, like, uh, generically anything with money.
Planning your income and your
outgo. Not knowing your income, your outgo, having the budget to plan for that. You know, you have some knowledge about your, your income, your outgo, so
you can budget.
Uh, Okay. Yes. I’d like the clarification, but is it on the list? It is on the list and Doug, you’re right. It’s number 10, which is not having a plan, which could even be wider, right? Wow. Your financial future. That is a pretty broad
plan. The word plan was in my
response. When you said the word plan, I did say plan.
I’m talking about cashflow
here. I use that. That’s what I use that.
Our answers were English.
People
listen, listen to me. That is personal finance 101. You gotta know what’s coming in, going out and have a plan. I’m
playing this one under protest
already. I wanted to say no to Len just so we could see the eruptions bigger than what we expect in Iceland.
Yes,
there’s still time.
There’s still time coming. Uh, your financial future depends on what’s going on right now. People spend countless hours watching TV or scrolling through their social media feeds, but setting aside two hours a week for their finances is out of the question. You need to know where you’re going, make spending some time planning your finances a priority, which would include Len’s point of having a spending plan.
But Len, it is even bigger than that though. I mean, not having a plan is a big one. Well, yeah, you know,
and that goes, goes back to, to your shorter term stuff and your longer term stuff. I mean, I know a lot of people, they shoot right out of the gate. Oh, I want to have a, you know, a Lamborghini or whatever, you know, something, or I want to take this, this big expensive trip down the road.
Well, you got to plan for that. I mean, you can’t just. It’s not enough to just say, I want to do this. You have to figure out your way to get there. How much are you going to save? You got to set it aside. You know, how long is that going to take you? And how do you, you know, how much do you plan to divert of your discretionary spending into other things, you know, so you can make that plan happen.
So. Uh, yeah, without a plan, you’re kind of lost.
Yeah. I think you’re starting to see not having a plan, living on borrowed money. Those are the types of really big, frankly, the fact that you guys went big. These are big, wide, uh, uh, wide, uh, categories, wide topics, wide things, wide thingies, Doug, is that the term?
Fixes in. That’s all I’m saying. Another wide things. Wide stuff. Yes. At the end of round one. End of round one, O. G. with one, Len has one, Paula giving herself the opportunity to come back in round two. But in round two, we go the opposite direction. Round three, Paula will go first again when we get to three points, but these now are two point answers.
So, Len, you can, uh, go for two in a row. Eight of them left on the board. Okay, so I have a few here. Did you say I have to think?
No, no, no, no. Well, which one I’m gonna choose. I have a few here. It’s like, which one do
I want to choose? I gotta think again. I’m gonna
say, I kind of want to, well, I’m gun shy from, because Paula’s wasn’t on there.
I’m gonna stay away from that topic. I’m going to say, not having enough insurance, like you’re underinsured.
is being underinsured. One of the top 10 business mistakes, mistakes, according to this piece.
It is not, but that’s another good one, Len. Yeah, that is a good one. Darn it.
And that wasn’t the one I thought was going to be the long shot.
So now I’m really going to be, that was my go to Len. So thank you for falling on your sword for that one. Crap. Yeah. I was, I was like, Oh, this one’s a lay down. Yeah.
You know what? Because You’re only supposed to buy insurance for the things you can’t afford, right? To pay on your own. So, I mean, to me, that’s a biggie. If you fail to have insurance for something that could happen to you and you can’t cover, I mean, that’s a huge financial. That’s why we insure our homes.
If most of us insure our homes, especially if we have a mortgage, you have no choice. But, um, you know, you can’t, you have to be able to cover that. Likewise for, well, health care, like people will have, um, long term health care insurance, stuff like that. That’s becoming popular now too. That can be devastating to your retirement savings.
So, I mean, those are things you really need to think about. They could financially devastate you. So I, I’m not, I’m surprised that one is not on there. I, you know, but hey, what do I know?
So things,
you’re saying insurance on things that you can’t afford to replace yourself. So by that logic, that tells me I did the right thing by getting the extended warranty on my PEZ
dispenser.
If you can’t afford a Pez, another, yeah, if you can’t afford another Pez dispenser, that’s true. Yeah. Good job. Good
job, Doug. Well, the question is why do you buy the first one? I don’t know. Maybe that’s on the list. Buying Pez dispensers.
Joe, do you remember going to that restaurant in the middle of nowhere, Michigan, and the whole hallway was nothing but
Pez dispensers?
It was. Where the hell were we? We were in the book. We were in Plainwell, Michigan. Plainwell, Michigan. Holy cow. They have a collection. It was a huge collection of pest dispensers. On Monday, in fact, uh, we spoke with Tiffany Aliche, the Budget Nista. I know Paula, you talked to her as well. Yes. And for people that didn’t hear that interview, we ran an extended, usually our interview is about 25 minutes long.
It went 40 because Paula, when we got to estate planning, she went down the road about her husband passing away at age 41. And this gets lent to your point about insurance. Like, I mean, the budget needs to put it right. You don’t know what the future holds. And she’s like, we were putting off our estate plan.
We’re putting off all this stuff. And in the morning, he’s fine. Calls me, says he has a headache. And a few hours later, he’s, he’s not there anymore.
You know, that’s life. That’s what life insurance for, right? To replace income that be lost if somebody dies early in life. And then again, going back to you only should buy it for the things that you can’t afford to replace as you get older and you’re, you’re getting closer to the, to old age and you don’t need that life insurance typically because your family is, you know, your kids are, should be out of the nest and, and you should have saved.
enough to get you through the rest of your
life anyway. So, yeah, you’ve got enough assets to take care of everything at that point. You know, Len, the number one insurance she said that most people should have that they don’t have. And the number one thing to your point that people need to replace and they can’t, disability coverage, your ability to bring in a paycheck.
That was number one that people avoid that they should have. All right. Uh, Len, great point. Wasn’t one of them. Oh, gee, there’s still eight left here. What is. A poor financial decision. Uh, don’t know what happened there. The tip jar for Joe. Top 10, one of the top 10 most common financial mistakes. All I
know is that I had five things written down, as you said, and three of them have been X’d out and then the one that I got right.
So I only have one left. That’s all I can say. Top 10 most common Financial mistakes. Uh, I’m going to say it has to do with no emergency fund, no cash, no great rates on your cash, just no, can’t cover. I’m trying to, I can’t, you can’t cover, uh, an emergency. You can’t, uh, uh, you can’t, there’s a lot of things you can’t do if you don’t have enough money in the bank.
So I’m going to say something around emergency funds or covering an
emergency. There is no emergency fun on this list. Oh my god. Where? We have a disagreement, Joe. Hold on. Which number? Dissension in the
ranks. I think this falls
under number 7. 1,
Looks like the judges are reviewing it.
Sorry. Yes, you’re right.
You are totally right. Uh, uh, they have it listed OG.
They have it listed as living paycheck to paycheck for people not with us live. OG playing with, uh, with sparklers, uh, behind him, uh, living paycheck to paycheck was their answer. which would result in no emergency funds. So that is correct. In June, 2021, the U S household personal savings rate was 9. 4%.
Many households may live paycheck to paycheck and an unforeseen problem can easily become a disaster. If you’re not prepared, the cumulative result of overspending puts people in a precarious position, one in which they need every dime they earn. And one missed paycheck would be disastrous. This is not the position you want to find yourself in when an economic recession hits.
If that happens, you’ll have very few options. You know, there’s a lot of people out there, by the way, that have. very few options. And it’s funny to say, Oh, living paycheck paychecks a mistake. And I know there’s some stackers out there going, no shit. Cause I was that person. I was like, yeah, and I’m trying to break that.
But OG to your point, the second you can break that string. You either get a windfall, you work some overtime, you take a side hustle for a little bit, that emergency fund’s the way to go. Joe, that,
uh, little bit more in number seven there says, uh, lot of financial advisors recommend three months. Is that still?
The right number
for most people. What do you guys think? Oh, gee, what do you think? Three months?
Well, if you, to answer your question first, Joe, that you said before Doug just kind of bulldogged into the, into the conversation. I think that if you’re starting from nothing, something is better than nothing.
You know, Dave Ramsey has his baby steps. And one of the first things is put a thousand bucks in our emergency fund cash or someplace safe that you can get to. That’s really important. First step, even before. You know, starting to save and starting to put money in your 401k and you know, because we want to do those things because we know about the value of compounding.
We know the time value of money and it’s so important to do that. But if you are in debt and you don’t have any cash, any sort of extra debt is going to just pile up that payment. And, and it’s just going to be further, you’re just going to get further and further behind, and God knows if you have some sort of expense, some sort of emergency that happens, that now you need to come up with a thousand bucks, or you need to come up with two thousand bucks, or you get laid off and you’re out of work for, you know, a paycheck.
You need a little bit of breathing room first, so. I think that the first order of business is always cash because it gives you the opportunity and the flexibility to do those other things like pay off your debt and save. So Doug, yeah, I do think three months is a minimum number for across the board.
But if you’re starting from zero, something is better
than nothing. Paula, you’ve had the opposite issue, which is I think you’ve had like 65 years worth of cash sitting there, correct?
Yeah, yeah, well, I mean, I distinguish between your personal emergency fund. Versus your, if, if for the people who are listening, who are entrepreneurs or own a small business, or even if you have a side hustle, you need a personal emergency fund, you also need an emergency fund for your business.
And if you pay yourself a salary through that business, then the emergency fund for your business should include the money that you pay to yourself. as if you were any other employee. And then also, for those who are listening who have rental properties, you need a third bucket, which are cash reserves for those rental
properties.
Yeah, so you have separate for one for each one, which makes a lot of sense. Yeah. Just getting my little poke in there. Speaking of you, Paula, it is your turn. Uh, we’ve still got seven of them out there. Okay,
so… I’m going to broaden out my previous answer because my previous answer I think was maybe too specific.
Rather than talking particularly about, you know, maxing out a retirement plan. I’m gonna say a common mistake is not adequately planning for big long term future things. Like not thinking about and planning for a big, like a long term, long term financial
goals. Not
doing any good money stuff.
Big ticket!
Long term! I think the biggest mistake is making mistakes. I think that’s the, probably the biggest one. Not planning! This is
a game within a game. How broadly can I phrase something? This is truly
the game. Is not saving for long term on there. It is on there. It is not investing for retirement is on there.
So, Paula, you had don’t get the match. It’s bigger than that. Just not investing for retirement. So unfortunately, we couldn’t give you the first time, but way to come back to it. Oh, gee, you even said that, by the way, when you were walking through it. So I should get double points? I thought, no, you said, I’m not doing that one.
I’m not, if I remember right, Doug, he said something like, I’m not going to be tricked by that. I’m like, okay. If you do not get your money working for you in the markets or through other income producing investments, you may never be able to stop working, this piece says. Making monthly contributions to designated retirement accounts is essential for a comfortable retirement.
Take advantage of tax deferred retirement accounts and or your employer sponsored plan. Understand the time your investments will have to grow and how much risk you can tolerate. Consult a qualified financial advisor to match this with your goals, if possible. Len, this is a hard thing, I know, for a lot of people to do.
Because, you know, our brains aren’t wired that way. Our brains are wired for today. So like thinking about if I’m 30 years old and I’m sitting here listening to Stacking Benjamins right now, how do you get somebody at 30 to take this thing 30 years from now seriously?
You know, all I can say is what worked for me and what turned on the light and luckily I saw this pretty much right around when I started earning a steady income with my main job.
But I think if you just look at numbers and you see how compounding and saving early and you realize that the earlier you start, you see how that compounding really works later down the road, like 30, 40 years and you see those numbers compounding. It, for me, it turned the switch on it. It’s like, you know what?
This only works if I start. Conversely, if you also note that if you start later, like I, I’ve seen things where if you start at 25 and you start saving it, I don’t know what the number is, 10 percent or whatever, you can stop saving at like age 40, you’ll still have more than the person who starts at like age 45 starts really late and then they’re saving like at 30 percent clip for the rest of their, you know, until they’re 65.
You’re still the person who started with saving 10 percent at 25. It comes out way, way better off. And if you just see those examples on paper for me, I mean, that convinced me. You look at the numbers on paper and you don’t want to miss out. You get that FOMO. It’s like, man, I have to jump in here and do this or, or I’m going to miss out.
It’s funny to your point, uh, Gene Natale, who’s has been a great mentor of lots of kids says when he gives them the stick and tells them, you know, stay away from credit card debt, they’re like, whatever. But then he shows them if you make a Roth IRA contribution, how much it makes you a millionaire, but you know, how quickly become a millionaire at 65.
If you do it at 17, they’re like, how do I do that? Like they’re excited. Speaking of the stick, Paula, I know you’re best friends with Susie Orman. You guys go way back. Way back. And Susie said something. I wonder if you agree with this. Susie said, when asked that same question once, she said, if you don’t think you can afford to save for retirement now, just close your eyes and imagine now it’s the year before retirement.
You’ve done nothing. How will you feel then? So talk about, I mean, that’s the stick, right? You’re like, oh crap.
Yeah. And that was actually quite motivating for me when I was in my twenties was knowing how hard it is to be broke. I was like, man, being broke in your twenties, fine. Being broke in your eighties, not fine.
Right. And so just knowing what it feels like to be broke and knowing that. To be young and broke is, is one thing, but to be old and broke is something that I just, it was such a big fear, so it’s something that I never want to experience. And so the fear of being old and broke, that really motivated me.
Yeah, generally fear, I’m not a fear motivated person, I’m much more aspirational, but that got to me too. Yeah. It totally did. I was like, man. Just, it is, it is ugly. All right. At the end of two rounds, Paula steps up and has two points. Mr. Penzo has one and OG has three, has three points. Oh man, I’m in the last
place.
I’m in last place. How
did that happen? Welcome to another game show, Len.
At the halfway point. And today it’s at the two thirds point of our show. We have a trivia question, a trivia contest. This is actually where our game show came from because game shows were playing for extra points. We’re going to take a little break here before we give you the scintillating round three to dive into Doug’s.
Trivia questions. So, Doug, what do we have on tap today,
man? You know, at the top of the show, Joe, you said I have my normal trivia. I don’t know my normal trivia. I have extraordinary trivia. Hey there, stackers. I thought
that was every week.
Extraordinary every week. You’re damn right. Yeah. Hey there, stackers.
I’m Joe’s mom’s neighbor, Doug. It’s December 1st and you know what that means. I’ve already eaten all 24 chocolates out of the advent calendar Joe’s mom gave me. I really don’t feel that good. They must’ve gone bad or something. I’ll just have to tough it out, because I promised her that I’d pick up a Christmas tree for her today.
Everyone already knows I’m a pretty rugged guy, but I like to be helpful too. And I’d hate for her to hire someone to do it when I’m right next door. Plus, I’ll get a good photo for the Instagram, which will make all the other ladies happy too, you know? If I get the right angle… Maybe I can make a side hustle out of picking up Christmas trees for single women.
Two birds. Two birds, one tree. I know I could just go down to the store and get a pre cut one like most people, but that feels a little bit like cheating. I prefer to go out into the woods on someone else’s land and chop down one for myself, just like Paul Bunyan did way back in the day. Joe’s mom has pretty high ceilings in her living room, so I’m gonna be on the lookout for a nine footer.
Today’s trivia question is, how tall is this year’s Rockefeller Center Christmas tree? I’ll be back right after I lay some blankets down in the old El Camino to protect her from that stupid
pine sap. This is a great question for the first Friday after Thanksgiving weekend. Obviously not Black Friday, but the weekend after so As we’re into December now, Paula, you get to guess last.
OG guesses second. Len, because you’re in the lead, man You get to go first. How tall is that Rockefeller Center tree this particular year?
Oh my gosh, I’m going to be embarrassed. I know this one, uh, I know it’s tall. I see it on TV, but I cannot, I can’t even begin to guess how many, how tall it is. Uh, gosh, I’m afraid I’m going to guess low, but I don’t know.
The number 60 feet is just sticking in my head. So I’m going to say 60,
60 feet. Mr. OG, what are you going to do with that?
So I think that it’s unfair that we’re referencing something that is in Paula’s backyard.
I think that’s very fair.
She could probably just
look out the window and go, I don’t know, how many feet is that thing out my
window?
Can you see Rockefeller Center from your window? I cannot. Have you walked by the tree yet?
Not this year, no. No, I, uh, I saw the tree in 2020. I actually haven’t seen the
tree since.
So we were there.
In 2017, I think, and it’s gigantic, like, I have this picture of my son, uh, as we kind of rounded the corner. So there’s like the, the, the, the boulevard where it is kind of tucked behind the, the, you know, the building. Yeah, yeah. And so you kind of walk down this thing and you kind of run, come around the corner.
You’re like, Oh my gosh, it’s there. And like, you know, a 10 year old, his face was just like, uh, you know, it was huge. We went ice skating. It was really fun. Uh, what was your answer, Len? 60. 60. I think you’re really close. I was going to say 100, but I don’t, I don’t think 100. I think 100 is really tall. That’s like 10 stories.
It’s not 10 stories. Yeah. I’m gonna say a little bit more, give Paula something to deal with here, uh, 80 feet. 80 feet? 8 0. Yeah, Paula needs to, I gotta, I gotta, I gotta play the game. We’re just, we’re running out of
Fridays. You got 60, you got 80. Paula, what are you going to do with that? I’m going to
capture the upside 81 feet.
Actually, so we’re going to go 80 feet and one inch. Would that be?
Of
course you are. We’ll do
that. 80 feet and one inch.
I want
it. I wanted all the upside. I think I thought you were going to say like. 70, 68 or something. So you could get smack in the middle. Okay. Damn
it. Len’s got 60. OG’s got 80. Paula’s got 80 feet and one inch.
We will tell you who wins. I think she’s got it in
just a moment. It’s a little taller. It’s maybe 90.
All right, before the break, Len, you kicked it off at 60 feet and apparently OG and Paula thought it was taller. What are you thinking? If you heard
me and when I started, I thought I was going to underdo it, but, but, um, I don’t know, I, you know, I’m looking out my window, I’m looking out my window and I’m, I’m looking at the lots, you know, I’m Southern California homes here and these, you know, there’s a 50, you know, they’re 50 foot lots.
I’m looking and I’m guessing, okay, well, that’s a, you know, is the tree a little bit more than the length of that lot? And now I’m thinking about, it’s like, That’s probably a pretty piddly tree, so I’m, I think I’m under, I think
I’m under, yeah. OG, feeling good at 80 feet? I think it’s
more than 80, but I don’t think it’s 100, which was my initial instinct, and so I was just trying to give Paula something to have to deal with,
so.
Well, and Paula, you dealt with it. How you feeling? I’m, I’m, I’m
feeling good. Yeah, I’m feeling good. If it’s like, 80 feet and one quarter of an inch. I’m going to be, going to be mad.
Well, let’s see if Paula nails it. OG got it. Or if Len’s right, uh, with it being a little bit shorter. Doug, what’s our answer?
Hey there, stackers. I’m chocolate lover and staggeringly handsome lumberjack, Joe’s mom’s neighbor, Doug. Every year since 2007, after the Rockefeller Center Christmas tree is taken down, it’s been turned into lumber that’s donated to Habitat for Humanity. Pretty cool to think that Jimmy Carter’s out there somewhere building a house out of an old Christmas tree, huh?
Today’s trivia question is, how tall is this year’s Rockefeller Center Christmas tree? The answer, coming in at a gargantuan 12 tons, the stunning 80 plus year old Norway spruce that’s bringing joy to millions of people in Manhattan this year stands at an impressive, well, I’ll say this… It’s 20 feet longer than what Len guessed and one inch shorter than what Paula guessed.
That means OG has nailed it. It’s 80 feet tall. Jeez, and I thought the 9 footer I chopped down was heavy. Wow.
Oh gosh, that’s ridiculous.
I was right. Paul, it was hard to keep a straight face knowing that you had no prayer. You could
get… And you
know what? I think if you went up there with a measuring tape, it probably could have been 80 feet and one inch.
Yes. I bet if it did some yoga and stood up straight, it would be
80 feet and one inches. Come on! Finally listen to its mother. You can do it, tree. Some good
posture.
Yeah. All right, time for the thrilling third round of our game show. Third round of the game show, brought to you by deposit accounts.com. You guys know what happens, Paula?
You know what happens when you go to deposit accounts.com, you find
out that the accounts that you’ve previously been depositing in are nowhere near the best in class.
Well, unless you’ve got one that’s already in the top 1%, and there’s a huge difference between the top 1% and the rest of the accounts.
I’m doing this a little bit early, but I’m putting in deposit accounts.com into my browser right now. Listen to this, Paul. The national average, according to deposit accounts on savings accounts, 0. 48 percent still. Top 1 percent average, 4. 92 percent is huge, huge difference. When it comes to CDs, one year CD, national average 3.
98, one top 1%, 5. 72. You want to check it out, head to depositaccounts. com because we recorded this a little bit early. So. Here’s the thing that we’ve got going on right now. It’s the big final round. Paula has two, Len has one, OG has three, and we’re gonna go third round, I think, in order of who’s in what place.
Which means, Len, to put pressure on everybody, can you tie OG and get to three?
Well, I had one I was gonna be really obscure, but I, I, this, these are big financial mistakes, right? You’re talking big. Supposedly,
right? Yeah, so far, I mean, we’ve got living on borrowed money, not having a plan, not investing for retirement, and living paycheck to paycheck.
Yeah. Well, the one I was going to, I’m going to, I’m going to save it for after I lose this thing here, but cause I’m going to bring it up and see what other people say. I don’t know. So I’m going to go with the one I think is more likely to be on there. I think the one I was going to say is actually a pretty cool one.
Okay. So this is, to me, this is a huge one. Cause I have friends who did this and I shook my head when you refinance your house, most people like, like I refinanced my house five times. And not once did I ever take money out of that refinance. I just lowered the interest rate and left it. But I know so many people that refied over the, you know, when these interest rates were low.
And they took the money and they’d spend it on a boat, or they’d spend it on a, I don’t know, you know, uh, Airplane. Great vacations, stuff like that. And they’d, and then before you know it, I mean, the, You kind of defeat the whole purpose of the refying. And, and I think over time, that’s a huge That’s a lot of money.
You got a sweet boat. Especially if you did it, if you did, yeah, you might have a sweet boat, but what if you did it like five times like I did it and you took money out every time? I mean that. You’re really jacking it. It’s great at first, but I think it really, in terms of huge, you know, big effects, I think that that has got to be on there.
It has to be. And
I rest my case. I guess blowing your refi money. Is that what we’re going to call it? Blowing your refinance money? Yeah, I’m going to say blowing your refinance money. Blowing your refinance money. Is that on the list? It sure is, Len. Except they call it using your home equity like a piggy bank.
Well, that’s what it is. That’s what it is. Refinancing and taking cash out of your home means giving away ownership to somebody else. In some cases, refinance might make sense. You can lower your rate or if you can refinance and pay off higher interest debt. However, the other alternative is to open a home equity line of credit.
This allows you to effectively use the equity home like a credit card. Could mean paying unnecessary interest for the sake of using your home equity on, on whatever. Yeah. A boat. All right, Len ties it up. Len now has three. Oh, I have four. OG has three. I have four. I’m sorry, Len has four. Yeah, Len, thank you.
Math, apparently, not my strong
suit. What was Len’s first answer? What was your first
answer, Len? Having a plan. Not having a plan. Oh, yeah.
Not having a plan. So, Paula, you’ve got two to beat Len. and force OG to sweat it out.
All right, I’m going to say, not being on the same page as your spouse or
partner.
Not being… Yeah. On the same page.
That could be correct. That could be correct. As your
spouse. Or not having financial conversations with them.
Not being on the same page as your spouse or partner. Is it on the list? Aww. Again,
a good one.
It’s overrated. Yeah. Again, a really good one. How, how often have we, well, what number two cause of divorce, Paula?
Oh, number two. What’s number
one?
How about
infidelity? This is funny, I don’t…
Yeah. I always thought that money was the number one cause.
I saw just last week it was number two on a latest poll. Uh, let me pull up what was number one.
Seems pretty obvious.
So for potential suitors out there, just so we’re clear, Paula, you’re cool with the whole infidelity thing?
I just want to get everything straight. I mean,
it’s a
thing now. Don’t say anything, Paula, just don’t say anything.
Yeah, number one is infidelity. Yeah, it has to be. Number two is trouble with finances. Number three is lack of communication, which, Paula, you got two and three in there. Number four, constant arguing.
See number three, right? Number five is weight gain. Weight gain. Weight
what? That’s a good one. Yeah.
Number six, not having a sweet boat.
Keeping all of your home equity money in the home. Like a
chump. Communication for people in a relationship. Absolutely huge. OG, you’ve got three. Len’s got four. Who’s going to win this thing?
I have two answers. One is very specific, but I feel like it could be on the list based on some of these other answers. And one is very generic, which I think might be on the list, but should be. But hard to say based on the list. I think I’m in, I’m, I’m kind of stuck. What was, Len, what was the other one you were going to say that you thought was really good?
No, I’m not going to say it. I just want to see if we have the same ones.
I
think it’s on there, but it’s obscure. But I think it’s
on there. Financial mistakes. I like the home equity one, Len, and that brought up another one that I was thinking about. That I feel is very specific here. But people complain about a lot.
Uh, so I’m gonna go with it, just see what happens. I’m gonna say, not, uh, how’s this word, top 10 most common financial mistakes. Like replacing your car too often. You know, not driving it into the ground, like I gotta get a new, like leasing cars, I’m just trying to. I’m just trying to put a lot of stuff around cars right here.
Something about cars and getting new ones all the time. Maybe cars and boats. Like having a car that tows a boat, um, which would include owning a boat, which would be bad. Because you got away with the whole micro d one, I think this one, this one, this one’s a little specific. So big money, no whammy.
Something about cars and getting new ones that you’re not
supposed to. Is buying a new car on the list. It is on the list, which
means OG
brings it home. You see the look of relief on his face? That was genuine. Kind of
make it a game for the last couple of weeks. Len, what was the one that you had on your list, but you thought might not
be on the list?
Co signing. Don’t co sign for a loan.
Co signing did make this. By the way, I did think out of, we’ve had some, as I mentioned at the top of this show, we’ve had some pretty rotten lists. This is a pretty good list. I think, I think the ones that you guys got living on borrowed money, not investing in retirement, living paycheck to paycheck, not having a plan, using your how am I going to like a piggy bank, buying new cars.
I think those are good ones. And you guys mentioned some other really good ones. Yeah, the ones that, well, Paula, what was, what would your next guest have been? For no
points. I only had those two in my head.
Yeah. Okay. Uh, anybody, anybody have any more? Wait, actually I
take that back. Yes. Not having an estate plan.
Calling me. Me, me, me, me. Cosign wasn’t on the list.
Which one of us just got out of college again?
Yes.
Not, not having an estate plan. You know, that’s
not on the list either, but that’s a good one. Just like the insurance one. It’s great. By the way, this is an investopedia list and we’ll link to it in the show notes, but excessive and frivolous spending is number one, just very foundational, just excessive and frivolous spending.
Yeah, that’s just the whole, yeah, it’s spending too much. It’s
also like no plan. That’s basically what Len said first, right?
Well, that’s why I said, it’s funny because I said, do you think it’s number one? And Doug said, no, I think it’s number 10. And I was like, oh yeah, number 10. Yeah. So those were the two we were debating on.
So Len was going to get that one probably either way. Next is never ending payments. Just buying things on payments and burying yourself in, I got, I got another payment, then another payment, another payment. So your whole budget goes to payment subscriptions, all this stuff. Uh, next is paying off debt with your retirement savings, like 401k loans.
That was another one. And then spending too much on your house. Spending too much money on your own stuff. That’s a good one. Yeah. I would put at least the insurance one up against those. I thought that was a huge one. Yeah. Yeah. And the estate plan is obviously huge. Just absolutely huge. Great game show, guys.
Thank you so much for playing. Let’s find out what all of you guys are up to, where you are. Uh, this, uh, first full weekend in December. OG, what are you doing this weekend? I have to whisper. Can I whisper?
You can whisper. I have a surprise for Mrs. Ochi this
weekend. Oh. It’s kind of like a Christmas gift, but she doesn’t know
it’s coming.
That’s
fabulous. It’s involved a lot
of planning for
like six months. Did you buy her a new Lexus? Park it in the driveway? It’s
the season of, what do you say? The season of savings. That’s like obviously the
best commercial. Len Paul, you guys know what we’re talking about? The Saturday Night Live
commercial?
Yeah, the Lexus commercial with the big, big red ribbon on the
top. Yeah. Yeah. But do you know the Saturday Night Live skit?
Wait, this is, that was also a Saturday
Night Live skit? No, it doesn’t ring a… Yes. Guess, guess what we’re doing? I just had the
commercial, the Lexus commercial where… Ah. Because
of the commercial.
Hey Matt,
I think there might be
one more gift for your
mom, right
there. What?
It hasn’t been a normal year, so this Christmas, get her something extraordinary during the Lexus December to Remember sales event. Nathan, you didn’t. With flexible financing and 0 percent APR, there’s never been a better time to buy or lease a new
Lexus.
Merry
Christmas, baby. Are you kidding me, Nathan? Did you seriously buy a car without asking me? Well, because for Christmas. This is a major purchase.
Right, but
it was a December to remember. It’s a Lexus. We don’t have the money for this, Nathan. We don’t? No, we don’t. Your father doesn’t. Your father hasn’t worked since last
March.
What? Yeah,
COVID has hit a lot of people hard,
and I’m no exception. Nathan, you got fired in March 2019. COVID had nothing to do with it.
Hey pal, I guess your old man’s
busted.
Hmm.
It’s beginning to look a lot like savings, so get
to your local Lexus dealer
today. How much did you spend on this ridiculous car, Nathan?
It was only 39. 99 to its signing. Four grand. It’s not that much, babe. And how much is the monthly payment?
The what?
Did you think this entire car cost 4, 000? Uh huh. There’s a monthly
payment! Yeah,
but with the 0 percent APR, I think it’s all good!
APR?
Do you mean APR?
I’m pretty sure it’s APR. Wow.
Just wow.
Hey, come on, it’s Christmas! This is good! I did a good thing for us, let’s enjoy it! Dad, it’s 9 in the morning! So?
Not like I have work later. Come on! Sorry.
He starts drinking a
beer and then it turns out that his neighbor comes over and it turns out he borrowed the money from his neighbor for the aper.
That
is one of the better ones they’ve ever done. That’s a good one. So it’s not
that. No, it’s
not that. You didn’t borrow it
for Christmas.
Something else. It’s December to remember. What’s Lempenzo. com this December? Well,
I’ve… I’m rerunning a post that got great feedback from the readers going back and forth debate on when’s the right time because it’s gift giving season.
When is the right time to stop giving gifts to nieces and nephews? Oh, that was quite, it got quite a, uh, quite a little debate going on that one. So, uh, anyways. Stop on by Lenpenso. com. Read that and don’t forget to click the ad. It is the
Christmas season. You’re going to find out which Thank you very much.
You’re going to find out which members of the Lenpenso community are Ebeneezer Scrooge, as you go through those comments. You should never get your nieces and nephews anything or your spouse. Paula, what’s going on at affordanything. com? Oh,
on the Afford Anything podcast, Jamila Soufant is on the show. Oh, awesome.
She’s, um, she, the host of the Journey to Launch podcast. Morgan Housel is on the show. He’s talking about his new book, Same as Ever. Never heard of him. That’s the title of his new book. Is he
related to, to Hugh? Is it Hugh? Hughel? Hughel Housel? Yeah, Huell Housel, California Gold. You don’t watch PBS. Oh, forget it.
That’s a California joke, I guess. You have to be, you have to be on the West coast to know that one. And you have to be pretty old to forget it.
Our older California listeners are like, duh, it’s his nephew, Morgan. Yeah, gotta be. But Morgan Housel’s
coming on. Morgan Housel, exactly. One of the most brilliant minds in the finance world.
Present company excluded.
Oh, very much included.
And that’s it. Uh, Afford Anything where finer podcasts are distributed. All right. That’s going to do it for today. Thanks everybody who joined us live here to watch this, this, uh, recording session. I almost called it said this train wreck.
It wasn’t awful.
There wasn’t a lot of swearing. We didn’t know. There’s not a lot of stuff to edit. Steve’s got an easy job
this week. I think. I thought we held it together pretty, pretty well. You guys did a special. Yeah, I think we will. 2024 thing. Oh gee, that we’re going to do a few more live Fridays. So hang in there and come join us, subscribe to our YouTube channel.
So you can get in on the goodness that’s hanging out with us. I know. Just pinch yourself, right? Uh, but we end every show with a to do list. Doug, what should be on our to do list after today’s game show? Well, Joe,
first, take a moment to scour your banking app for subscriptions, then lock that cash into your pocket by raising your automatic savings by the same amount.
Second, make sure you take advantage of employer sponsored investment plans like a 401k. But the big to do? Always check for wildlife before you chop down a tree. Otherwise you might end up getting attacked by an angry family of squirrels. Looks like this guy’s gotta get another rabies shot. Third one this year.
Thanks to Paula Pant for hanging out with us today. You’ll find her fabulous podcast, Afford Anything, wherever you listen to Finder Podcasts. Thanks to Len Penzo for joining us today. You can find Len at LenPenzo. com slash Ebenezer. Scrooge. Thanks also to O. G. for joining us today. Looking for good financial planning help?
Head to stackingbenjamins. com slash O. G. for his calendar. This show is the property of SB Podcasts, LLC, copyright 2023, and is created by Joe Saul Sehy. Our producer is Karen Repine. This show was written by Lisa Curry, who’s also the host of the Long Story Long podcast, with help from me, Joe, and Doc G from the Earn Invest podcast.
Kevin Bailey helps us take a deeper dive into all the topics covered on each episode in our newsletter called The 201. You’ll find the 411 on all things money at The 201. Just visit stackingbenjamins. com slash 201. Wonder how beautiful we all are? Of course you’ll never know if you don’t check out our YouTube version of this show, Engineered by Tina Ikenberg.
Then you’ll see once and for all that I’m the best thing going for this podcast. Once we bottle up all this goodness, we ship it to our engineer, the amazing Steve Stewart. Steve helps the rest of our team sound nearly as good as I do right now. Want to chat with friends about the show later? Mom’s friend Gertrude and Kate Yunkin are our social media coordinators, and Gertrude is the room mother in our Facebook group called The Basement.
Say hello when you see us posting online. To join all the basement fun with other stackers, type stackingbenjamins. com slash basement. 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, Doug, and we’ll see you next time, back here at the Stacking Benjamins show.
What was that? It’s called the medium sketch.
The medium
sketch? Yeah, it wasn’t rare, and it certainly wasn’t well done.
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