Doesn’t it feel like 2023 just began? And yet, we’re here nearing our final episodes of this historic year. LOTS of incredible events happened this year. What should we have learned from a big bank collapse? From Bitcoin resurging? From the stock market moving up (along with interest rates)? We asked about all of these and more to Today Show Money Editor and host of the Her Money podcast, Jean Chatzky. Jean shares great tips on your budget, investments, money in bank accounts, and more.
But that’s not all. In our headline segment we share some of the recent moves in interest rates. Now with rates beginning to fall again, are there moves we should have made? We also throw out the lifeline to a Stacker who needs help AND Doug shares his best trivia ever.
Deeper dives with curated links, topics, and discussions are in our newsletter, The 201, available at https://www.stackingbenjamins.com/201
- Money Moves to Make If You’re Expecting the Fed to Lower Interest Rates (Wall Street Journal)
Big thanks to Jean Chatzky for joining us today. To learn more about Jean, visit Jean Chatzky – Making Money Make Sense. Grab yourself a copy of the book How to Money: Your Ultimate Visual Guide to the Basics of Finance.
- What government entity insures the money in your bank account up to $250,000 per depositor?
Stacking Benjamins Lifeline
- “Nick” from “Alaska” calls in with a question about cutting expenses when there’s nothing left to trim.
Have a question for the show?
Want more than just the show notes? How about our newsletter with STACKS of related, deeper links?
- Check out The 201, our email that comes with every Monday and Wednesday episode, PLUS a list of more than 19 of the top money lessons Joe’s learned over his own life about money. From credit to cash reserves, and insurance to investing, we’ll tackle all of these. Head to StackingBenjamins.com/the201 to sign up (it’s free and we will never give away your email to others).
- Here’s to 400! AMA with Jean Chatzky (Episode 400 of Her Money)
Join Us Friday!
Tune in on Friday when we’re recapping all the best financial lessons of 2023, with a very special panel of contributors: Paula Pant from Afford Anything, OG, and
Len Penzo NEIGHBOR DOUG!
Written by: Kevin Bailey
Miss our last show? Listen here: Doug and the Three Ghosts (SB1450)
Hey, this is Joe’s sister, Nikki. I think I might be the only girl in the world
who has a brother who spends his entire day in the basement pretending he has an internet radio
Live from Joe’s mom’s basement at the Stacking Benjamin
I’m Joe’s mom’s neighbor, Doug. Today we’ll be discussing what we should have learned in 2023 with today’s show, money Editor Jean Chatzky. In our headlines, interest rates are falling. What move should you make? We’ll help you create a checklist. Plus we’ll throw out the lifeline to Lucky Stacker, Nick from Northern Alaska.
Who wants to know how to cut back on his budget when it feels like there’s nowhere to trim. And then I’ll share some insured trivia. And now here they come, one guy in a red suit and the other who has a stomach, like a bowl full of jelly. It’s Joe and oh ju.
Why know? I’m the one in the red suit. No way, dude. Hey everybody, welcome to, uh, we need to Work Out More Podcast. I’m Joe Saul. See, hi I, Joe Money on Twitter X you name the platform. And across the card table from me, my friend. og. How are you man?
You might, uh, have to work out more. I am getting yoked, bro.
Buff. Well, I’m my way. Yeah, I’m not doing the January 1st nonsense. I started November 1st. Well, that’s
good because have you ever tried to go into the gym on January 2nd and you can’t. Get the bike. You can’t get the
weights. You can’t. Yeah. ’cause that’s why I said I wanted to start on Yes, November 2nd, so that I know all the people at the gym.
So that when you walk in, you go where all these losers, the good news is they’ll be outta here by the 20th. The good news,
I was gonna say, the good news is you just wait three weeks and you get Yeah, we got a great show today. We got Jean Chatzky joining us. We even talked to Jean A. Little bit. Nice, isn’t it?
Well, 2023. Just about over, which means somebody’s birthday’s almost here. Done. Have you made your birthday slash Christmas? It’s very
close. Christmas spankings. Oh, it’s a whole D spankings. I got my spankings yet, it’s a whole
different, we’re gonna pause the, uh, show right here so people don’t hear the, uh, OG spankings who’s administering these, uh, hypothetical spankings.
Wouldn’t you like to know? I don’t, don’t you? No, I wouldn’t like to know. So let’s, let’s pause again. 45, 46. Man, that took forever.
You have gentle hands. I appreciate that. We got Gene
Chatzky here. . Let’s get this show started.
Darlings. And now it’s time for your favorite part of the show, our Stacking Benjamins headlines.
Today’s headline comes to us from the Wall Street Journal. This is written by Amani Moist. These are moves OG with, uh, interest rates going lower. I’m gonna switch, uh, gears here. Go over to bank rate the average rate on a 30 year mortgage drop to 7.41% last week down from 7.55. What a bargain last week, and by the way, down from eight earlier in the year.
Yeah, like we’re watching mortgage rates come down, but we’re also looking at CD rates, high yield money market rates. Those are actually looking pretty nice right now. I think it’s time for us to talk about og. What moves do we make now that interest rates have settled down a little
bit. Honestly, when it comes to treasury rates and the federal rate, which is the, the, the one that everybody pays attention to, you wanna pay attention to what is going on with your variable rate stuff.
Now, a mortgage rate that changes from seven and a half to seven, I’m not gonna go out immediately and try to refinance at seven, but if you’re in the middle of a transaction, if you’re in the middle of, you know, a deal, you’re, you’re buying a rental property, you’re buying your primary house, you’re refinancing your house.
I don’t know why you would’ve done that, but maybe are, and you know, you’ve noticed that these rates have changed. Absolutely. You should talk to your lender and go, Hey, rates are a little lower. And if they won’t move, if they won’t play ball, just tell ’em to pound sand. Because the mortgage market right now, in particular, it’s, it’s a kind of a desert, right?
There’s not a lot of action going on. And if you’re in the middle of a deal and the rate’s gone from eight to seven or seven and a half to seven, and you can’t get a part of that action. Tell ’em to kiss your butt, you’re gonna go find another lender and I guarantee somebody else will be totally happy to
give a deal.
Yeah. And most people aren’t gonna let you go because of the fact that they need you far more than you need
them. Yeah. Let ’em call your bluff at that point. The other thing that’s happening well, will happen eventually, although it’s a, it’s a much bigger lag. The funny thing is, is interest rates on your savings account will adjust right away.
Interest rates on the cd, they’ll adjust right away if, uh, you’ve got a credit card debt that’ll adjust in like three months from now. So any variable debt’s gonna have, gonna have some changes. I wouldn’t expect to see a lot of changes for savings or money market rates right now. Frankly, the Federal Reserve didn’t change rates at all.
So that lending rate between banks, which is kind of where everything’s based on, hasn’t moved, but the supply demand and, and treasury yields have, which is what we’re seeing in the fixed income
market. Well, email@example.com, who’s our sponsor on our Friday episodes? Top 1% average in savings accounts right now, 4.9399999999999995% of one year CD paying 5.69.
Those are the ones in the top 1% og. It’s still a big difference between that and the national average. National average, 0.49%. Man, if somebody doesn’t have a high yield savings account as their second tier cash reserve, I don’t know what they’re waiting for. I was talking
to somebody today who, we have a cash product.
I don’t know if I should tease it like, nah, nah, nah, nah, nah, nah. Or just say, call OG and I’ll hook you up. I don’t know which one, but, but we have a cash product that is a high yield savings account. FDIC insured pays 5%. It’s FDIC insured up to $12 million if you structured all correctly. So basically that covers everyone all the time.
What’s neat about it isn’t any of that sort of stuff, but what’s neat about it is it ties itself to your main checking account. So let’s say that you say, Hey, my, my, you know, I want my check account balance to be $10,000 all the time. That’s the float that I wanna have in the up and down. This product, this cash account, will every two weeks look at your account.
If you’re above 10, it’ll pull the 10 into your savings. If it’s below 10, it’ll push money back from your savings to get it back to 10. Wow. And it’s super cool and it pays good interest, obviously. And it’s FDIC insured and it’s, there’s no fees or anything, but I was telling somebody about this, uh, this week, and I said, you have to do it.
How much money do you have in your savings account? And he says, I don’t know, like 50 grand. I said, $50,000 at banquet. What, what are you doing, man? Notwithstanding that, you know, just giving away free money what we think of Bank of America. Oh, it’s so much inertia to opening up a new account, like a inertia.
It takes like six minutes. It’s like literally click a link, type your stuff in, hit submit. Drop down, find your checking account, hit submit transfer, 40,000 done. I’m like, what are you doing, man? At 5% at 40,000 bucks, 2000 bucks a year. You know, you’re not gonna get rich on it. No, but it’s something, but a free
Yeah. And especially when you’re thinking about, well, somebody’s making it right. The bank’s lending this money out at a 10 to one leverage at 20%, and they’re, and you’re, and, and they’re like, giggle, giggle. You’re only getting 0.4 if you don’t have most of your money in a high yield savings account right now for your emergency fund.
I, I don’t know. I dunno what, what you have to do. There’s an I’ll do it for you. I’ll split the interest with you. Fair enough?
There’s enough. No. Okay. There, there’s a, I don’t think anybody’s gonna take, uh, take you up on that one. There’s another piece to this from the Wall Street Journal, which is super interesting.
OG doesn’t mean it’s gonna happen this time, but historically, whenever the Fed has a pause, right? Listen to this. Stocks and bonds both tend to perform better in a pause before rate cuts than after. According to analysis from BlackRock, since 1990, stocks purchased in the six months after the first rate cut in a cycle have returned an annualized average of 15% compared with a 21% return for investments made during the pause.
Bonds return average of 15% in the pause before the cuts, and 7% afterward. If we are in a Fed pause right now. You’re not invested in the stock market ’cause you’re worried about whatever. You’re worried about interest rates. Well, what are you waiting for?
Well, yeah, I, I can’t imagine that there’s anybody who’s actually sitting there thinking, I’m worried about interest rates at this moment.
That the s and p, which is the largest, biggest companies in the United States and halfway across the world, the s and p five hundred’s, up like 23% for the year. Small company stocks in a bid for diversification, where we talked about this some time ago, that the spread between big companies and small companies is the largest it’s ever been.
They were just getting smoked, you know, so if you’re diversified, which you should be, right? You were going, why am I diversified?
I said, he’s at 20%, my small cap’s
only up six. Score more. That one. Yeah. Man, I don’t wanna be diversified anymore. Small caps since November 1st are up about 18%. You know, depending what metric you look at.
And here’s what’s really interesting. They’re still down 25% from their all time high. You know, we were hearing last week the Dow hit an all time high. The s and ps closed above 4,700 for the first time in a year, you know, so it’s feeling pretty nice. Everybody’s feeling pretty good. And then there’s small caps over there going, what about us?
We’re up 18% in six weeks. It’s like, yeah, yeah, cool. You’re still down 25% from your all time high. So, you know, from a diversification standpoint, now is a great time to reassess that. We always talk about at the beginning of the year. Wonderful time to rebalance your 401k, rebalance, your asset allocation, and irrespective of what’s going on with interest rates, you know, just you got a little bit of time, take some holiday time, go in and do some math.
Rebalance your accounts. Don’t touch it again for another 365 days.
A lot of people worried about a lot of different things, og maybe they’re worried about, you know, maybe it’s not interest rates. Maybe it’s all the global stuff going on. Maybe it’s the election year. By the way, we had a fantastic special episode back in early November, almost exactly 12 months before the election.
It’s, uh, Stacking Benjamins 1435 investing in election year with experts from Fidelity, from T Row Price, and, uh, one of the top behavioral economists in the world, uh, uh, Brad Klontz joining us. So a nice all star panel there on SB 1435, if you’re worried about that. Oh gee, they’re singing off your song sheet, as you know on that episode, that, uh, paying attention to any of that stuff versus paying attention to what happens with interest rates.
I think that it was the, uh, the t Rowe Price Pro who said that their professionals at t Rowe Price worry much more about interest rates than what happens with the election. And this point in the interest cycle is. Is on a short term basis, a great time to be in. We don’t wanna look short term, but it still is the time to be in.
And yet we get sucked into all these other factors, you know, factor deger. Yeah,
it’s, uh, you know, we should wait until the, after the first of the year. We should wait till the election. What about all the craziness going on in Europe right now? What about the Middle East? What about my congress person’s an idiot, or my town has a bond referendum.
I should wait and see what happens. There’s, I should wait for my job, see what happens with my, just invest according to your plan.
We are going to dive into this even more in our newsletter, the 2 0 1, where we dive deeper on all these topics. Uh, Kevin Bailey on our team curates a bunch of fantastic links if you want to explore this topic even more, but even more than that, he’s gonna explore.
What we’re gonna talk about in our next segment, Jean Chatzky from The Today Show, from Her Money Jean, just a wonderful human being maybe has been on this show more than any other guest, I would think. If there’s anybody who is the voice of reason in this economy, it’s always Jean Chatzky love talking to her.
And Jean’s going to bring us what she thinks are the biggest events that we could have learned from in 2023, and Kevin will be diving into that as well at our newsletter. The 2 0 1 comes out twice a week, always free. Stacking Benjamins dot com slash 2 0 1. Also, you’ll find out about what’s going on when we have special events and more.
And man, do we have a nice, uh, calendar of special events next year? Maybe not as special, og as, uh, you and I getting to play the ghosts like we did yesterday or on Monday. That was fun, but that was well done, but still very special. All right, Doug, you got some trivia, man.
Hey there, stackers. I’m Joe’s mom’s neighbor, Doug, the Christmas Classic. It’s a wonderful life premiered on this day in 1946 in the movie bank owner George Bailey, played by the handsome Jimmy Stewart is at his Witts end after a series of mishaps and a run on his bank caused it to default. I guess I really gave him a run for his money.
this thing on?
After losing nearly everything, George has talked out of throwing it all away in a get rich quick scheme, the scheme jumping off a bridge to his death in order to collect on a $15,000 life insurance policy. Well, that might not sound like much, but in today’s money, that would’ve been over a quarter million dollars.
Just as George is preparing to jump his guardian Angel Clarence comes to stop him from ending it all. You know, I’ve always thought of myself as the guardian angel of this show, got endless wisdom and I save the show week after week. I’m often described as heavenly, just heavenly. Today’s trivia question is what government entity ensures the money in your bank account up to $250,000 per depositor?
I’ll be back right after I see how much of the money that’s hidden under my mattresses covered by my homeowner’s insurance.
there, stackers. I’m Wise man and guardian. Angel Joe’s, mom’s neighbor, Doug. After Nationwide Bank Failures helped cause the great depression. FDR signed the banking act into law in 1933 to help build back public trusted banks. Somehow Bank of America and Wells Fargo have found countless ways around that trust.
Among other things, the banking Act guaranteed depositors would retain at least a portion of their money, should their bank default. And initially this guarantee was up to $2,500. Today, that’d be the equivalent of $57,000. So things have come a long way. Today’s trivia question is what government entity ensures the money in your bank account now for up to $250,000 per depositor, that’s the equivalent of $250,000 in today’s dollars.
I just thought I’d do the math for you. The answer, the FDIC or the Federal Deposit Insurance Corporation is who protects you. Don’t worry. Credit union members, you’re protected also by the equivalent of the FDIC, known as the NCUA and now here to teach you how to make sense of your money is today’s mentor, Jean Chatzky,
and I’m super honored. She’s back in mom’s basement with us. Jean Chatzky is here. How are you?
I’m really good. I can’t believe it’s December. I can’t either. That is just crazy to me that we are so far along this year, but I was out walking the dog yesterday. It was flurrying, so I guess it is indeed winter.
You know, double, um, I don’t know. It’s a holiday spirit going on. We’ve got a great year end show that you’re obviously the middle of here, Jean, but congratulations are also an order. The average podcast, as you may know, Jean, seven episodes. You guys just did 400 for her money, what, a week or two ago? Wait.
podcast is only seven
episodes. Can you believe that? Seven episodes?
I did not know that. Yeah, we just hit our 400th. We’ve been going for seven years. We haven’t missed a week. You know, that’s better than my wordle streak, right? I mean, it’s pretty good. I
love episode 400. We’ll link to it in fact.
’cause I love the celebration. I love also the ask me anything. And people ask you all kinds of questions. I
loved that. I got to actually talk to my listeners. You know, when we do our mailbag, typically they’d send us their questions, which is amazing. The questions are hugely detailed and my listeners are awesome.
They just lay it all out there. But I got to talk to them, which means they could ask, follow-up questions and I could learn more about their lives than was just on the paper. And it made me wanna do more of that. I. I was
just waiting for one of ’em to like fight with you to go, nah, I don’t. No, I’m kidding.
think so. Yes, exactly. I have children for that.
I’m always looking for drama in my podcast. But her money, drama free zone, which is probably better so most of the time. Right, right. Uh, let’s go through, there was, uh, plenty of drama in 2023. I was reading a piece Gene recently in Esquire Magazine where the author said, you know, I woke up January 1st, 2023, and I thought it couldn’t get crazier.
And yet if you go through all the headlines of 2023, our life became busier, our world became even more upside down, and now we’re going into an election year with 2024. So we’ve got even more. What was an event you think that kind of shaped 2023 for you and for our stackers?
I mean, let’s just start where we kind of started the year with some bank collapses, right?
I mean, we had Silicon Valley Bank followed by a couple of others. People had not seen this in quite some time, and it made a lot of people wonder, you know, is my money safe? Is my money safe? If it’s not in a big bank, do I need to diversify more about where I’m holding things? I think we have so much faith as we should in the FDIC and the banking system in the United States, that this is just one of those things that is a little bit of a no-brainer, right?
You put your money in a bank and it’s supposed to be safe. We, of course, have FDIC protection. Of course, the depositors were made whole, but it caused us to stop and think about that portion of our financial life that we haven’t thought of for a while.
We see a lot of people, you and I chasing interest rates, right?
The optimizers. They go, Hey, I want to invest in this or put my money in this little bank because it has half a percent higher than everybody else has. Are you saying that’s a bad thing where maybe the name brand on the bank is, is a good thing for us?
I am not saying that that’s a bad thing, and in fact I am a huge credit union fan.
I’ve got my money in high yield savings accounts, but only up to the level of FDIC protection. And I think that’s where you’ve gotta be careful, you know, if you’ve got more than the $250,000 per depositor, then then you need to just have multiple accounts and you know, that gets to be a little bit of an administrative hassle.
But with interest rates where they are right now. I would also say I. You’re finally earning some money on your money, you should take advantage of that. When you look at the average interest rate that banks are paying these days, and I just looked at this earlier this week, it’s 0.37%. Yeah. That’s the average, right?
It’s no longer 0.1, but it’s 0.37, which is nothing compared to the four and a half percent that I am earning. I believe in my My Citizens’ Access account, right? And they just keep ratcheting up the amount that they pay me. Every time interest rates go higher, I don’t even have to ask
for it. Well, big theme.
I think, Jean, that was bigger in 2022 than 2023. I think in 2023 we saw inflation kinda level up, but inflation’s still kind of a theme for this year. I think. And if you’re earning 0.3% in your savings account, don’t get me wrong, you’re very safe, but you’re very safely losing money to purchasing
power every single time.
Yes, you are losing money month after month. You’re losing money year after year. And what bothers me about this form of losing money is that it’s so easy not to, right? It’s, it’s so easy to just flip the switch. I mean, everybody and their mother, including her money, has a list of the best high yield savings accounts in the country.
Go there, open an account and move your money. And just know that if you wanna bring it back to your brick and mortar bank account, it’s probably gonna take you a day. Maybe
two. We’ve had so many headlines though this year, ’cause I think there’s another switch we could flip, which is maybe putting your money in a spot that fits your long-term goals.
But I opened up this discussion with this, this author at Esquire talking about how crazy this year the headlines have been, you would think the stock market gene had a bad year. And yet you take a look at the stock market, which as you know, is a fine place for your long-term goals. The, the, the stock market actually had a decent year this year.
Like is it, did 2023 prove again that maybe just following the headlines is not great for your investing philosophy?
Yeah, I, I think so. I mean, when you’re talking about big events that hit this year, I would point to the fact that there are two wars being fought. Right, and we are heading very, very quickly into a presidential election.
And if you look at the impact of both of those things, when you look at the impact of war on your portfolio, often in the first couple of days or maybe even weeks, when the market is uncertain about the direction that this is gonna go, portfolio tends to trend down, but then it comes back, right?
Historically it has come back. And that was absolutely the case this time around. And with the presidential elections. Very interesting. I, I, um, host a podcast called Everyday Wealth. In addition to the Her Money podcast, it’s sponsored by the folks at Edelman Financial Engines. They did a, an interesting piece of research looking at the impact of the parties in Power on Portfolios.
So they looked at. All the different permutations. Republican in the White House, democratic Congress, Republican Congress, Democrat in the White House, split Congress with different Republicans and Democrats. Bottom line, very, very little difference across the board, like fractions of a percentage point. So really it doesn’t matter.
You gotta just get invested, stay invested, hold your nose when things get ugly, and and realize that things will over time, come back. And as we were talking about sort of big events, I mean, clearly those things include Bitcoin. Now, there was a chart that came out this morning that showed Bitcoin has actually been very stable.
Holding. When you look at the volatility in, in Bitcoin, it has not been long-term volatile as much as you might expect. And it had a good year this year. So if, if people sold out when it was at the low as they tend to, when the stock markets hit a bump, they’re probably pretty sorry.
Well let me ask about that.
This year we lost an icon. We lost Charlie Munger all just before his 100th birthday gene. He called crypto crypto crappo. We played, we played a clip of that on our scene. So looking long-term, if I’m just beginning to invest, just beginning to put money into markets, you know, looking at that Bitcoin story you just mentioned, is this a place where I go, is this the future or is it gonna be, you know, a central bank digital currency?
More and more,
you know, I don’t know. I don’t know, but I, I do think blockchain is a thing of the future. And personally, I, I mean, I don’t own a lot of Bitcoin, but I own a little Bitcoin because I didn’t feel good about being left on the sidelines for what could potentially be a big part of the future.
So I did what I’ve suggested that my listeners do. Probably a couple years ago now, I just started buying every month, little bit of Bitcoin, and I’ve had a good year in it. I, I don’t expect that this is what’s gonna happen every year, but the fact that I’ve got, I don’t know, is probably. One to 2% of my holdings in Bitcoin.
I’m okay with that.
I love that, that it’s a, a piece that you can use. By the way, it was probably two years ago too that I also started just buying a little bit, but I should have talked to Eugene. ’cause I bought Ethereum, which, uh, had an okay year, but not the Bitcoin year. So I should have called the gene hotline first.
heard Ethereum at the time too. The guest that I had on my show, a guy named Bill Ulman, who, who made a lot of sense, said, go open a Coinbase account, pick a few different currencies, start putting a little bit of money into each of them and see what happens. And I picked Bitcoin, Ethereum, and Litecoin.
And then I, uh, I just wasn’t reading enough, hearing enough about the Ethereum or the Litecoin to keep me feeling good. So I moved it all to Bitcoin.
I wish you would’ve called me. Uh, text me next time, gene, please. All right. It’s funny, as we’ve talked, we’ve gone from, you know, something as very conservative, FDIC toward the stock market toward Bitcoin.
Arguably maybe more aggressive. Let’s go back to conservative land again. With interest rates going up this year, we saw a lot of conservative investors that were invested in bonds. Bonds have had a rotten last couple years. Jean and I have feel they have. I feel bad for our very conservative investors.
’cause some things like Ginnie Mays, which historically have been a very easy place to invest a very, Hey, what could go wrong? Well, it went wrong this time around. What’s our lesson right now? I think for our conservative investors or maybe older investors that are trying to reconcile what to do with their bond portfolio.
of all, I would say if you’re doing any tax loss harvesting, don’t forget, you can harvest losses in your bonds to write off against any gains that you have in your stock portfolio. People sometimes just don’t think about that. Right? Yeah. When it comes to trimming losses, so end of the year, that’s something you can look at.
I think even in the scheme of things, two years is a pretty short time, and so I’m certainly not, I haven’t given up holding bonds. I’ll continue to hold them. I expect that they’ll continue to have some good years and, and some not so good years, and we’ve known that this, because it’s a safer asset category than stocks is, is not gonna outperform stocks, so you can’t expect it to do that.
By the same token, I think you gotta be aggressive. When it comes to making the most of those interest rates as a saver, right? I mean, we talked about that before, but a lot of people are, are still not doing that. The fact that interest rates are, are up, but allows you to, to earn more on your savings. If you are somebody entering retirement or in retirement and you’re thinking you want to add some income to your portfolio, the fact that interest rates are up means that you’re getting a lot more money out of an annuity potentially than you were in past years.
So, you know, sort of figure out how to play both sides of the coin. And I think if you can hold onto your bonds, right, your bonds are gonna return what your bonds were gonna return unless you sell ’em. Midstream. If you made a plan to go in and hold onto them, then your plan has not been wrecked. You just have to stick with it.
That’s fantastic advice. It always makes me, I dunno, it puts a pit in my stomach when somebody goes, oh, I just couldn’t take anymore and I had to get out. Which is usually, you know, fighting. That I think is the, uh, number one thing that you could probably do with your money. Just fight that. Feel. What, what is that gene?
Feel the fear. But, uh, hold in there. I dunno. Yeah. I,
I, I, that’s a good way of, of saying it as senny. I think the other way to say it is talk to somebody or listen to Joe. Right. You reassure people on a regular basis. So tuning into this show is a nice way to, to get that continued reassurance that you’re on the right
That’s because we get to hang out with cool people like Jean Chesky. I mean, let’s be real. If Jean wasn’t on the show, it’d be a whole different matter. Yep. Let’s, let’s, you were talking about savers and people saving one big thing that are. Younger stackers all trying to do right. The old quote, American dream gene, own a house.
And with interest rates up, man, trying to buy a house two years ago versus buying a house today may be a whole different deal. What would you say to people that are out there thinking I’m, I might wanna try to buy my first house now?
I would say cool. Your jets just a little bit. Look, we think interest rates are gonna start to come back down a bit.
The forecasts that I’m seeing are showing that maybe by the end of 2024 we’re back in the 5% range. Whether or not that’s true, I’m, I’m not exactly sure, but we think we’re at the end of this or close to the end of this round of hikes. You’re gonna get more house for less money if you can wait a little bit.
So put money for a down payment into a savings account, let it grow. You’ll be able to put down more, maybe buy more house, or at least have a little bit more of a cushion as you go into your house and know that, you know, renting right now is actually a pretty smart move.
I wanna draw attention to one more big event from 2023, which a lot of our stackers use budgeting apps, right?
They, they track their money using apps. How about this one, Jean mint, mint. Yeah. RIP to Mint. What do we do? So,
a couple of things to do, but before you get to what do we do, my Mint story is, it was actually a Quicken story. Oh. When I was a reporter at Smart Money Magazine, at the very beginning of Smart Money Magazine, so this is back in the nineties.
Quicken had become,
I love that magazine, by the way. Yeah. I was a financial planner back then, and every time I go to the newsstands, which are no longer around anywhere, I would grab my smart money. But anyway, continue. Yeah.
So I wrote a story about the Cult of Quicken, and it was really a story about the cult of the fact that people really loved tracking.
They, you know, once they started doing it and seeing where their money was going, it made them feel in control and they, they just loved it. They couldn’t give it up. And I think that’s why the. Death of Mint, which was owned eventually by the same company. Intuit hit people so hard. It’s a little addictive, right?
You’re addicted to Mint the same way. You’re addicted to Noom, or you’re Step Tracker, or you’re Fitbit, and so you’re looking for a substitute. You know, there are a lot of apps out there. There are not a lot of free apps out there. You can look at Rocket Money, you can, but we
learn. Did we learn over time Gene That free might not be a great thing.
There’s a downside to
free. Yeah. The downside to free is that they’re selling your data and you’re the product. Yeah. Right. That’s the downside to free. There are some apps that will charge you a little bit. Members of the Her Money community really like Wine A. We hear that from them in our private Facebook group.
You have to pay for that on a monthly basis. They also really like our finance fix program. So if you’re just getting started on this, this trajectory of trying to save more, spend less, get outta debt, work your way towards your goals. We run a program called Finance Fix. It’s an eight week course. You work with a coach, you work with a group of people, you do some work on your own.
It’s not onerous. It’s a couple hours a week. And over the course of this eight weeks, we’ve got people saving $1,500 on average. Wow. Yeah. And we’ve put hundreds people through this. We’ve got more going through every single month and we, um. We are launching specific classes in 2024. For younger people, people, you sort of right outta college, just getting started and for pre-retirees both ends
of the spectrum.
Both ends of the spectrum because they’re both really important points to get a grip on your cash flows.
They’re the two things to get right. Right. I think that building that savings muscle immediately outta high school, outta college when you get that first job is so important. If I had done that, Jean, I.
I wouldn’t have had to salvage my working. Well, no, I would’ve done that anyway. Rent is zero. That’s fantastic. But what I would’ve done is I wouldn’t have had to put Humpty Dumpty back together again like I did through the late nineties and early two thousands. I would’ve been much better off. And then the second thing is, you know, we spend a lot of time on how to put money in.
We don’t spend nearly enough time on how do we take money out.
Yeah. And it is a completely different muscle. And I think the industry, the financial services industry is just beginning to wrap its arms around it. I mean, the bottom line is when you are getting to the point where you are ready to take money out, you need a plan because you’ve likely got money in.
4 0 1 Ks, maybe Roths, maybe discretionary, you know, taxable accounts. You’re making a decision. One of the most important you’ll ever make about when to take Social security. You’re trying to completely hack your income so that your Medicare premiums don’t go through the roof. It is dodgy and accumulation is actually much, much easier.
Save more, save more, save more. This is difficult, but one of the things that you have to do to get it right is not overspend in those early years of. Retirement. So this pre-retirement checkup is really about getting that spending component right? Yeah.
So important. I wanna end on a note that this actually alludes to, which is that, uh, withdrawing money from your portfolio.
And I wanna ask you this specifically, Jean, because you have one of the largest platforms in personal finance. You are often the face that we see in the media, but there’s another big face that our super stackers saw this year. A gentleman you may have heard of named Dave Ramsey, who the majority of your audience in ours.
They don’t even know what a withdrawal rate is, right? So they’re like, well, what are the nerds getting so upset about? But the personal finance community, as you know, blew up when Dave had a rant about, it’s just simple math gene. Your funds do 12%. The inflation’s four, that means you can take out eight.
And the world, my world online kind of blew up on that with somebody that has a platform as large as yours. When you see stuff like that, what’s the first thing that goes through Jean chat’s head?
Uh, it, it’s mind boggling because especially if, for people who are starting out, if they, first of all, 12%, like who’s doing 12% on a year in, year out basis, right?
That’s one of those things where if you get wrong, you’re gonna face a lot of pain at the end of the road. I, I was, I was thinking about this last week because what happened last week? You already mentioned Charlie Munger. Charlie Munger died at what? 99. 99.9. Yeah, 99.9. Henry Kissinger died at 99. Rosalyn Carter died at, or Henry Kissinger might’ve been a hundred.
Rosalyn Carter died at 99. I mean, we had all of these nineties deaths, hundred year deaths. That reminded us that we have a hundred year life, which means that all the math that is done, and the 4% rule, just to go back to it for a second, that is or is not a rule, depending on who you listen to, was designed to allow for a, a stream of withdrawals out of your retirement that would last 30 years.
Well, you retire at 65 and you live to a hundred. You’re, you’re cooked. It is not enough. And if you withdraw more than that. Forget it. The money is, is not gonna last even that long, which means you’ll be living on social security, which we all know is having its own issues. And so when I see bad advice like that, I, I just, it, it makes me wanna, wanna pull my hair out as I’m sure it does.
Well, you know, I hate, uh, because as you know, we need more people listening to personal finance stuff. People could take all our channels put together and there’s still not enough people paying attention. You can see it in the numbers every day, which is why I hate picking at each other. But I feel like in some ways, gene, we have to be each other’s compliance department, right?
We don’t have a compliance department for podcasters.
No, we do not. We do not. And let’s just acknowledge it’s complicated. I mean, one of the things with withdrawal rates that drives me crazy is that these days every year, Morningstar comes out with a new number. For withdrawal rates, right? Like this year they actually were at 4%, but last year I believe they were at 3.2%.
And the year before that I think they’re at 3.5%. And this is why I actually am a fan of trying to figure out some sort of a protected stream of income that will cover your fixed expenses. Mm-Hmm. That will supplement social security. We all need money in the markets, we all need growth. But I would like to know that I’ve got an income stream similar to the pension that my father had that will last me as long as I live, no matter how long that is.
And. One good way to get that is with insurance. And so I, you know, I know that, that they’re complicated products, but I think more than ever before they have a place, and we’re gonna see it because they’ve made their way into 401k plans where they’re going to start to gain some traction with the BlackRocks of the world working on low cost solutions for these products.
Yeah. And I love the pushback we’ve seen over the past, especially I, I feel like the past five years in that industry, really the pushback on some of the super high fee things. Um, because you’re right, people say here, pension, they go, oh, I want one. You say annuity, they go, Nope. Hard pass. And, and maybe it’s the person who needs an annuity more than anybody else.
They just hear the name and they don’t like it. Where they really don’t understand what they’re doing. Yeah.
Jean, thank you so much for celebrating the events of 2020, the, the horrible events of 20. Hopefully cheers to a happy, uh, 2024 for you. Congratulations on 400 episodes of her money.
That’s fantastic. What’s suming up on her money? Let’s talk about that for a moment before we say goodbye.
We’ve got some really great shows and guests coming up. I’ve got an interview this afternoon about the world economy with Rana Farha, who is an amazing global journalist and how it impacts your money, so I’m excited about that.
And yeah, we’re looking forward to next year. We are also. This year we launched a second podcast. It’s called How She Does It, Karen Feinman from CNBC, who’s a professional investor, is our host. She and I also teach investing every other Monday night on Zoom through our investing fix program. So she is just killing it.
She’s got amazing, powerful women who are, are talking about the intersection of money and life, and she is fantastic. So I hope that people will give that a try as
well. We will link to all of it on our show notes. Paige at acu Benjamins dot com. Happy holidays to you and yours, Jean. Thank you for mentoring our stackers again in 2023.
David Hirsch, and when I’m not hosting the Dad to Dad podcast for the Special Fathers Network, which is a dad to dad mentoring program for fathers raising kids with special needs. I’m Stacking Benjamins. Big thanks to Gene. I know OG you’re gonna be commenting on, uh, what you and, uh, our roundtable team think are some of the most important events on Friday.
But Jean, bringing up Bitcoin and talking about that, you know, the beginning of this year, people talking about, uh, crypto kind of dead, and you look at where crypto’s at now versus at the beginning of the year. What are your thoughts on crypto? Maybe preview a little bit of what we’re gonna talk about on Friday.
Well, I wish that I would’ve put all of my money, leveraged it 10 to one, and, uh, taken a mortgage in my house.
Forget small company stocks like we talked
about earlier. Yes. Just to dump it all into Bitcoin. That would’ve been fantastic if I, if I would’ve only had a crystal ball. I’m with Warren Buffett on crypto.
It’s a big nothing and, uh, it doesn’t do anything. It’s like precious metals in my book. They don’t produce anything. They don’t make anything. They don’t give you income for holding it. It’s a shiny rock, and it doesn’t even keep up with inflation. So I’m okay with not having exposure there, but I think this is a great year from an investing standpoint to recognize how important it is to stay the course.
Because this time last year, we were staring at minus 20% in the market, minus 20 some odd percent in the market, and now we’re plus 20 some odd percent. And there were plenty of people who this time last year were like, Nope, not getting any better. Inflation’s coming, interest rates are gonna skyrocket, economy is gonna crash.
And you know what? That stuff may still happen. There’s no guarantee that 2024 isn’t what people thought 23 would be like. And but, but what really happened was people who stuck to the plan, uh, stuck to their plan. And tuned out all the, you know, all the noise were rewarded with, with a pretty good year in their statements.
So I think it was just a great lesson in diversification and a great lesson of just work the plan
time for us to throw out the lifeline to a stacker that needs some help with their money. Head to stack your Benjamins dot com slash voicemail if you’d like us to throw out the lifeline to you. We don’t get many calls from Alaska.
How great is this A die bite? I don’t. Right. We’re throwing out the lifeline for the last time. This, this year. A dark smile friend. We got some phenomenal episodes next week. Those are gonna be looking back at some of our best interviews and top uh, moments in 2023.
Tonight is the darkest night in Alaska tonight and tomorrow night.
Yeah, but guess what? I. Springs on its way starting tomorrow.
You already counting the days. You got the calendar out, putting slashes on it. It gets better from here. Well, it might get better now ’cause we just don’t get calls from Alaska. Maybe he’s bored. Uh, this guy’s name is Nick calling us from Northern Alaska.
Hey Nick. I wonder if it’s a CK or
just a C
ho. Hello, Joe and og. This is Santa Nick calling from the north, uh, Alaska. I have to say, I travel around the world once a year and love catching up on the show. It’s a jolly good time even though I don’t learn a thing. Here’s my question. I’ve got terrible budget problems. Several years ago I told the Mrs that I give presents to a bunch of kids, I don’t know, pay it forward.
She said, you’ll become a legend. That sort of thing. Well, I have to say it’s gotten out of hand every stinking year I load up my sleigh. I mean, uh. My, uh, pickup with all of these toys. It used to be trucks, trains, and Barbies, but now they want iPads, xboxes, and thousand dollar phones. I mean, I give these ankle biters everything they ask for, and they always just come back asking for more.
I know what you’re going to say OG, and before you say it, I’ve already tried to cut my costs. We had the great idea of stuffing things in socks to limit the amounts, but before you know it, that just became an add-on, and now these rascals all expect a sock full of junk and their silly presents. Oh, greedy little and all for what?
All I get in return is a few Christmas cookies and now they’re all gluten free. Where’s the fun in that? Between us. I’ve even gone so far as to hire a bunch of undocumented workers. They’re out in my workshop, behind the house, making knockoff purses and jewelry as we speak. I wouldn’t be surprised if the feds knock on my door tomorrow and shut us down, and if that weren’t a big enough problem, we use deer in our, uh, delivery system and the animal rights people are breathing down my neck.
I really, truly don’t know what to do anymore. So here’s what I need to know. How do I cut when there’s nothing left to trim? What would you do if you were me? Thanks guys. Hey,
thanks Nick. That voice sounds
familiar. I feel like I just saw this guy a couple of, uh, weeks ago at a brunch. Did
you? Same voice Yeah.
family? Yeah, yeah, yeah. He seemed to be in a better mood. I mean, he is a little. A few more cookies or eggnog or something. This is
tough. Where do you cut when there’s nothing to cut,
what to do? What to do?
Uh, I think sometimes it’s an income problem, right? I mean, if he’s cut everything, maybe he’s cut too far.
If he’s using undocumented health, yeah. He’s, maybe he’s cut too much. Maybe he needs to begin, uh, finding ways to make some money pair back. Yeah. Like
yeah. Charged for pictures.
He totally could do something like that. 49 95. There’s gotta be some kind of a markup game there, Nick, because um, yeah, to your point, it gets more and more difficult
Well, you think that he’s, he’s probably wholesale and everything, right? So maybe he could distribute to other
distributors then have them like cradle little pyramid scheme action. Yeah. Yeah.
I mean, like, he’s making all this stuff, right? So distribute it to, you know, have it, have it, yes. Sold at Amazon or Walmart or something.
then, and then mark it up. I don’t know, Nick, there’s a lot of different, uh, income streams that you might be able to get at. Hopefully you can find one. Uh, happy holidays to you, Nick, and uh, thanks for the call. If you’ve got a call for us. In 2024, head to stacky Benjamins dot com slash voicemail and like Nick, we’re gonna send Nick a, a tea.
Nick didn’t leave an address That makes any sense. That’s okay. I’ll, I’ll tell you about it later. But I don’t know where we’d send this shirt. I think we could just leave it out maybe
and get the queue going. ’cause we’ve got, uh, lots of energy at the first part of the year. Everybody’s gonna be looking at their plan.
Everybody’s gonna be going, oh, what do I do? What do I do? I get these questions. Guess what? About a hundred thousand Other people also have that same question every single week. Good point.
So get in the front of the line. Get in the front of the
line. Ask your question, get a free T-shirt out of the deal.
Cue it up fellas. And ladies, we’re ready to go. Stacking
Benjamins dot com slash voicemail. Hey, and uh, before we transition to our back porch segment, man, we got a lot for the back porch, og. A couple quick things. Number one, if you’re not here because you have distribution problems and undocumented workers in here, yes,
please don’t call.
If that’s the case, your workforce, you’re, I
can’t help. You’re, you’re here. You’re here because of the fact that you need a better plan in 2024 while OG and his team are taking clients. So had to stack you, Benjamins dot com slash og and that’s the link to his team’s calendar to get you hooked up with a meeting so you can see how they may interface with you so that you have a solid financial plan.
From here on out, Stacking Benjamins dot com slash og Hey, on the back porch, uh, we started talking about last week our joke off, and you know what we got. Only two
so far. Guess people aren’t
as funny as you thought. Well, I know they are. I know they just need some prodding. We’re gonna have some good giveaways.
We have not revealed what the giveaway is yet. We’re going to do this like a March Madness exercise. So, uh, send them to me, Joe at Stacking Benjamins dot com. And, and, and by the way, Jonathan has one of the jokes and he said to me, you know, last week we had Vivian two on Vivian is your rich. BFF on TikTok has close to 3 million people following her on TikTok.
Great discussion we had with her last Wednesday that you want to dive into. But her book was called Rich Af. And uh, Jonathan writes, well, I have your attention. I wanted to point you something out. Usually we define acronyms when presented, such as Rich af. You left us all guessing on the af, but with my 20 years of military experience, I deduced what it means.
Clearly it’s Air Force, they get all the money. It’s obviously not Rich Mc because, well, Marines not so good with math. It says not rich nave, too busy buying their boats. Rich Ssf Space Force doesn’t count yet. Still infants. And lastly, if it were Army, it would’ve just been titled Best Airborne. Thanks.
Thanks for that. And Jonathan had thanks for your service. Clearly, clearly OG Vivian is, uh, rich as Air Force. Rich Air Force. Yeah, absolutely. Rich Air Force. I think he’s right. And og. Last week I saw a film in the movie theater. How about that? Not only is the movie up for, uh, golden Globe, so is the lead actor, uh, gentlemen you might have heard of named Nicholas Cage.
This is, uh, this is dream scenario.
the Zebra look the way it does?
embarrassing. Hey, focus says how, what? No, it’s different now.
You’ve been on my mind recently, huh? You keep popping up in my dreams. You don’t do anything, you’re
just there. So this specific person, the remarkable nobody. I’m so at that experience. Do you have a picture?
you been dreaming about me? Have I been
dreaming about you? Yeah.
That’s, uh, Tim Flowers who used to be on, uh, Saturday Live plays the dean at the college where Nicholas Cage’s character works and OG a lot of people on earth. Many, many people begin having these dreams in one dream. A guy’s being chased by zombies, a lot of people being chased by zombies.
And here comes Nicholas Cage, just walking by, not doing anything, just casually observing the dream. Another person has a dream and Nicholas Cage is raking some leaves, and he’s watching is all this weird stuff happens. He doesn’t do anything. He’s just in all these people’s dreams and he’s a pretty boring dude.
And then of course, he gets notoriety because. Everybody sees Nicholas Cage in their, in their dream, so he becomes the most popular lecturer on campus. Everybody wants to talk about how he’s in their dreams and things take off from there. This movie is, uh, listed as a comedy. This is one of those movies that is a comedy.
It’s pretty funny, it’s funny in a dark way, but it takes such a turn at the end that is so dark and so weird. I think a lot of our stackers might not love this movie. It’s, it’s the kind of movie that you go and you see and then you go, let’s go to a coffee shop, or let’s go hang out over a couple beers and let’s talk about what the hell we just watched, because I’m not really sure what the meaning is.
I’m not sure what’s going on. Cheryl and I had a fantastic discussion after this movie for me, solid eight and a half, nine. On a scale of one to 10. I loved it, but I know a lot of our community that just wants, as you call emoji popcorn movies. Wants to go see something and, you know, walk out and just have a satisfying experience.
This is not a satisfying experience. You get done and you’re literally like, um, okay. I do say this Nicholas Cage, you know, has done some really weird ass rolls lately. This dude has been in some strange stuff. You could tell he’s got all kinds of debt to pay and we, we like, like, oh, uh, I just gotta breathe in it.
Okay. Yeah, I’m in. Uh, what’s the plot about, by the way? Like, it’s almost like he doesn’t care what the role is. You could tell he really cared about this role and he did a hell of a job. He’s like the old Nicholas Cage that you remember from the good old day. So I can see why he’s up for the award. I can see why the award is up for an award, but sometimes, as you know, oh gee, these movies that get up for these big awards, you know, you get all excited, then you go see it and you’re like.
Oh man, the heck did I just do? Yeah, yeah. That movie left me in such a weird place. So I don’t know. Thumb sideways on dream sequence. Okay. I know you’re probably not seeing it. Doesn’t sound like it. Nope. And that’s why we do the review. I’ll just
re-watch a football game.
Exactly. And if you see Nicholas Cage watching you watching the football game, you know, it’s just gotten weird.
That’s gonna do it for today, Doug. We’ve got quite a to-do list at the end of this one. Wrap it up for the year folks. Yeah, give us our top three. We’ll see everybody Friday. Oh,
with, don’t wrap it up then yet folks.
We got one more. We’ll see everybody on Friday with, uh, our. Top events of 2023 Doug. What should uh, go on our to-do list, though from today?
on our to-do list today? First, take some advice from Jean Chatzky. Don’t use today’s headlines to make horrible, short-term moves in your portfolio. While they may not seem horrible, now, you nearly always regret them in the end. Second, have money sitting in cash. It’s a great time to look at high yield savings accounts.
With interest rates now topping 5% in some accounts and close in others, your cash can probably do better than it’s doing right now. So what’s the biggest to do? I’ll tell you what mine is. Put my mattress money into the bank. Turns out insurance companies are unlikely to take your word for it. If you tell ’em that you had a quarter million bucks in cash hidden under your mattress and it it got stolen.
You got trust issues or something. State Farm, who hurt you?
Thanks to Jean Chatzky for joining us today. You can find both jean’s podcast. Her money and everyday money wherever you are listening to me right now. We’ll also include links in our show notes at Stacking Benjamins dot com. This show is the Property of SB podcasts LLC, copyright 2023, and is created by Joe Salsey High.
Our producer is Karen Repine. This show is 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 and Invest podcast, Kevin Bailey helps us take a deeper dive into all the topics covered on each episode in our newsletter called the 2 0 1.
You’ll find the 4 1 1 on All Things Money at the 2 0 1. Just visit Stacking Benjamins dot com slash 2 0 1. 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 Ichenberg. 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 a chat with friends about the show later? Mom’s friend Gertrude and Kate Kin 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 Stacking Benjamins dot 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 Benjamin Show.
You know that metal
plate in my head? How can I forget? I had to have it replaced because every time Catherine revved up the microwave, I’d piss my pants and forget who I was for half hour or so. So over to the va, they had to replace it with a plastic one and it ain’t as strong. So I don’t know if I oughta go say one down, no hill with nothing between the ground and my brain, but a piece of government plastic.
You really think it matters, Eddie?