Podcast Summary: Afford Anything

Host: Paula Pant & Joe Saul-Sehy

Episode: Q&A: Gold vs. Stocks – and Why Inflation Panic Makes You Poor

Date: August 19, 2025

Main Theme

This episode dives deep into the psychology of investing during inflationary times—especially the temptation to buy "safe" assets like gold. Paula and Joe tackle three listener questions:

1. The role of gold, bonds, and real estate during inflation, and how to spot predatory advice.
2. When (and if) private market investments make sense.
3. An update from a listener who faced a real-world “should I gamble on the market or play it safe?” dilemma—and has new questions about becoming a 1099 contractor.

Throughout, Paula and Joe encourage first-principles thinking, critical assessments of risk, and separating emotional narratives from financial fundamentals.

1. Gold, Bonds, and Real Estate in Inflation—Plus How to Avoid Predatory Pitches

[02:51] - [33:38] | Q&A with Ariel

• Why do investors flock to gold and other tangible assets during inflation?

  • Gold and real assets hold "intrinsic value" regardless of currency weakness—especially relevant in countries prone to currency collapse (e.g. Zimbabwe, Argentina) ([06:29], Paula).
  • Gold historically maintains purchasing power across centuries. "That same amount of gold is roughly what would buy a nice outfit ... whether it’s the year zero, the year 1500, the year now." ([08:31], Joe).
  • US context: Because the USD is a reserve currency, the incentive to hold gold is different but the reasoning is conceptually similar.

• How do bonds fit in?

  • Bonds are fundamentally loans; US Treasuries are considered ultra-safe because the US government is the ultimate borrower—"If the US ever got into a situation where we defaulted on our loans, the whole world would collapse." ([12:59], Paula).
  • The safety comes at a cost: lower returns than stocks, especially after accounting for inflation.

• Real Estate’s Role

  • Real estate preserves value and can ride with or outperform inflation, barring overbuilding or population decline—but is affected by local/regional factors more than gold or treasuries ([14:14], Joe and Paula).

• Predatory Sales Practices

  • Fear sells: Marketers often prey on recession/inflation anxiety to push high-fee products (gold, insurance, "market-neutral funds") that aren’t always in the investor’s best interest.
  • “It isn’t often what they’re saying, it’s what they’re not saying … the huge amounts of information they’re leaving out is absolutely criminal.” ([16:37], Joe).
  • Insurance industry pitches "equity-indexed annuities" or "market neutral" structured products that sound safe, but provide poor long-term returns and high fees.

• Joe’s Mental Model: Need to Be Right Twice

  • “If you invest in gold over the short run because you’re worried about asset preservation ... the problem is, you have to be right twice. ... We are very good at buying the thing we should be selling and selling the thing we should be buying.” ([20:38], Joe).
  • The best strategy: Start with your long-term goal and work backwards; optimize for growth (i.e. stocks, diversified real estate) over long periods, accepting interim volatility.

Notable Quotes

• “We often judge the outcome of decisions based on the result, when, in fact, the decision should be judged based on the soundness of the decision itself, not based on the result that followed.” ([77:27], Paula)
• “Their aim should be thinking about how to think rather than being prescriptive in their advice.” ([31:51], Paula)
• “[Predators] are simply pushing a highly marked up high fee product at you and they're using marketing language that's based around fear in order to do so.” ([15:07], Paula)

Actionable Takeaways

• For short-term goals: cash or cash equivalents.
• For 6-8 year goals: blend of bonds and select low-volatility stocks; avoid gold due to its volatility ([26:17], Joe & Paula).
• For the long term: accept stock market volatility, lean into assets that grow with or faster than inflation.
• Always prioritize professionals who educate, not just prescribe products ([31:51], Paula).

2. Should You Invest in Private Markets?

[37:49] - [64:43] | Q&A with Dave

• Who actually invests in private placements?

  • Most private investments are exclusive to “accredited investors”—those with $1M+ net worth. The typical investor in these deals has $5–10M+ ([41:53], Joe & Paula, citing Nick Maggiulli’s Wealth Ladder).
  • For the vast majority, “you can get where you want to go … very reliably using the simple path” of public stock index funds and real estate ([39:00], Joe).

• When do private investments make sense?

  • Only after your core financial goals are “funded at 120%,” should you even consider private deals. They are most relevant as “fun” investments with capital you could afford to lose ([41:44], Paula).
  • Roadblocks: high minimums, illiquidity, risk of total loss, and a “risk of ruin” that could set back your main goals.

• Risks are higher than they appear:

  • High-quality private deals are seldom available to most; “Often … the least risky investments are closed to you, but when you hit the accredited investor button ... the most risky [are] presented to you.” ([48:36], Joe).
  • Pitching via Facebook ads? “That’s like calling a lawyer who advertises on a billboard … They’re in the business of just collecting a large volume of money from whoever is willing.” ([51:05], Paula).

• Green Flags:

  • Only consider established businesses with a strong, multi-year track record, where you understand leadership, operations, and can do both qualitative (personal familiarity) and quantitative (review the books) due diligence ([53:00]-[55:32], Paula & Joe).
  • “I would suggest get some experience as an entrepreneur first … you will develop strong instincts and a very strong BS detector, but also a very strong like green flag detector.” ([59:26], Paula)

Notable Quotes:

• “It is very easy to feed into the passion of the founder. ... But I also want to learn how to have a good BS detector. And I think the only way to do that is to hear 50 pitches.” ([61:45], Joe)
• “I am ... a lot less enthusiastic for the average person to go down that road. Buyer beware.” ([64:30], Joe)

Actionable Takeaway:

• Develop business acumen before venturing into private markets. Go to local founder meetups, read foundational business books (The E-Myth, The Goal, Good to Great), and observe many pitches before investing.

3. Real-World Investing Outcomes + Transitioning to 1099 Work

[66:53] - [94:43] | Update and Q&A with Abby

• The Backstory:

  • Abby faced the question: Should I keep money invested before grad school or go conservative? She put $40k into QQQ (tech ETF) on her dad’s advice, invested $10k in I Bonds, and kept other money in brokerage accounts.
  • Outcome: QQQ gained $12k, I Bonds made $1k, but other investments lost ~$600. She then liquidated a 457 plan ($50k) to pay for the rest of school amid 9% student loan rates. “So I hope this is a lesson to everyone to listen to Joe.” ([66:57], Abby)

• Key Insight

  • Joe’s “planner” approach was more conservative, matching investment choices to known, short time horizons—versus Paula’s more flexible, risk-tolerant strategy.
  • “Your dad recommending QQQ ... in the eyes of a former financial planner was a bet ... Over that short timeframe ... QQQ is going to be more volatile.” ([72:57], Joe)

• Decision-making principle

  • Good outcomes from risky choices don’t make the original risk “good” (“Speeding through a red light and nothing bad happens doesn’t make it a sound decision.”) ([77:27], Paula)

• Negotiation Success

  • Abby successfully leveraged AfA negotiation advice: $190/hr (up from $170), two weeks on/two off, $60k signing bonus (from $15k). ([69:39], Abby)
  • “You got all of that from our free material from listening to the podcast. That is amazing.” ([69:48], Paula)

• Switching to 1099: What Now?

  • You're now a business owner, not a 1099 “employee.”
  • Organize expenses: dedicated workspace, tools, vehicle mileage, use expensing apps, regular bookkeeping, monthly review with an accountant encouraged ([82:25]-[85:03], Joe).
  • Retirement opportunities: Open a solo 401(k), maximize the Roth/traditional blend ([82:31], Paula).
  • Healthcare: You control your plan—select an HSA-eligible provider for tax advantages ([84:05], Paula).
  • Choosing Professional Help:
    • CPAs with entrepreneurship/bookkeeping experience preferred over just enrolled agents or tax attorneys ([85:14], Joe).
    • “Surround yourself with really smart people ... For me, it's a fantastic investment.” ([89:19], Joe).
  • Liability insurance: Use the “Who Not How” framework: ask peers in the field, consult professional associations for best-fit coverage ([91:44], Joe & Paula).

Notable Quotes:

• “Instead of going into YouTube hell, ask, who do I know that might know this?” ([93:01], Joe)
• “Actionable takeaway: Surround yourself with teachers, not just service providers.” ([31:51], Paula)

Notable, Lighthearted or Memorable Moments

• The running riff on "put to sleep" confusion between anesthesia and euthanasia ([92:28], Paula & Joe).
• Playful self-deprecation about not listening to their own past episodes/answers and derailing over Spindrift drinks ([71:57], Paula & Joe).
• Friendly debate over wealth ladder analysis, private markets, and the risk appetite of millionaires ([41:53]-[47:27], Joe & Paula).
• Closing jokes about sharing the podcast with the CEO of AngelList, Spindrift distributor, and the "nurse you’re about to not put to sleep" ([96:16]-[97:33]).

Timestamps for Key Segments

• Gold, inflation hedges, and predatory sales: [02:51] – [33:38]
• Private market investments & the wealth ladder: [37:49] – [64:43]
• Abby’s update, market “bets”, and 1099 business basics: [66:53] – [94:43]

Guidance from the Episode

1. For most investors, focus on stocks and real estate for long-term inflation hedging and growth.
2. Avoid fear-based pitches and high-fee products. Seek out educators, not just salespeople.
3. Private markets are best left for the very wealthy or those who’ve fully funded their goals—and even then, only after deep due diligence.
4. If going into entrepreneurship/1099 work, invest in bookkeeping/accounting help, leverage tax-advantaged retirement accounts, and actively seek advice from experts and peer networks.
5. Critical thinking, and “learning how to think” about money, is the most powerful financial skill you can develop.

Final Word:
“Ask who, not how ... and always ask why.” — Joe & Paula ([94:34])

[End of Summary]