Ask HTM - Best Grocery Cashback Credit Cards, Risking it with Ultra Cheap Car Rentals, & Giving Up on Home Ownership #1039

Summary

Podcast Summary: How to Money

Episode: Ask HTM - Best Grocery Cashback Credit Cards, Risking it with Ultra Cheap Car Rentals, & Giving Up on Home Ownership #1039
Hosts: Joel and Matt
Date: September 22, 2025

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Episode Overview

In this engaging Q&A episode, Joel and Matt tackle a slew of listener questions covering smart money moves with large cash windfalls, the ins and outs of grocery cashback credit cards, navigating the world of ultra-cheap car rentals, and how to handle Roth IRA contribution limits following marriage. True to their mission, they strike a balance between practical guidance and relatable, jargon-free conversation, providing actionable financial wisdom alongside real-life stories and humor.

Main Themes:

• Handling large lump sums after selling real estate, especially when opting out of homeownership.
• Maximizing grocery spending rewards with cashback credit cards, and coping with annual fees.
• Avoiding pitfalls with bargain-basement car rentals.
• Adapting investment strategies and Roth IRA contributions after a change in marital status.

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Key Discussion Points & Insights

1. Should You Give Up on Home Ownership? (07:50–18:21)

Listener Hayden’s Situation:
Hayden and his wife sold their primary residence and are about to sell a duplex, netting ~$600k total. Both have strong retirement funding—including maxed-out work retirement plans and future NY state pensions. The question: What’s the smartest move for this sizable, unneeded cash?

Insights:

• Homeownership as Non-Essential:
  "I really appreciate... the fact that Hayden and his wife decided that owning a home just wasn’t for them." – Matt (08:47)
  The hosts validate renting as a viable and perhaps preferable lifestyle and financial choice for some, especially given flexibility and reduced stress.
• Renting Can Mean More Flexibility:
  Renting offers adaptability if life changes unexpectedly, and can be a cheaper option depending on market trends (10:24).
• Tax Implications of Selling:
  Gains on primary residences are tax-free, but large profits on investment property (like the duplex) will face a capital gains tax—plan to set aside ~15% (12:20).
• Possible Tax Strategies:
  Consider occupying the duplex before selling to avoid capital gains tax, if your lifestyle allows (13:13).
• What to Do With the Windfall:
  Prioritize reflection about family goals before acting. Consider options like a “mini retirement,” charitable giving (donor-advised funds), or investing in a taxable brokerage account for growth and flexibility.
  "You can essentially have your cake and eat it too." – Matt (15:03)
• Don’t Rush Decisions:
  Take time, discuss possibilities, and don't lock up your liquidity too quickly (15:48).
• Mini-Retirement, Philanthropy, or Investing:
  Choosing among these depends on your priorities and readiness for “audacious moves” without risk to long-term security (18:21).

2. Best Grocery Cashback Credit Cards (22:18–33:44)

Listener Roy’s Question:
Is it possible to repeatedly get annual fees waived on top-tier cashback cards, and at what point does requesting a waiver become "cheap" instead of frugal?

Insights:

• Savvy Use of Annual Fee Cards:
  If you spend at least $3,000–$6,000/year on groceries, the Amex Blue Cash Preferred’s $95 fee is more than offset by 6% back (28:20).
• No Shame in Asking for a Waiver—But Success is Rare:
  "There's no amount of charisma or justifiable evidence... they essentially say this is just how it works." – Matt (32:29)
  Credit card companies often won't grant repeated fee waivers when a no-fee product exists for downgrading.
• Optimize Your Cards:
  Use the Blue Cash Preferred up to the $6,000 annual grocery cap, then switch to the no-fee Everyday Blue Cash (33:18).
• Military Exception:
  Active duty military personnel often have annual fees automatically waived, even on very high-end cards (34:41).
• Frugal vs Cheap:
  Asking once is fine but expecting continuous waivers is unrealistic—leverage card downgrades smartly instead.

Notable Quote:
“There's no amount of charisma. There is no amount of justifiable evidence that I was able to provide...” – Matt (32:29)
"Ethical fatigue—I'm going to use that in the future." – Joel (24:55)

3. Ultra-Cheap Car Rentals—Deal or Disaster? (47:13–53:50)

Listener Matthew’s Question:
Should you trust car rental companies with bargain-basement prices when others charge hundreds more?

Insights:

• You Get What You Pay For:
  The lowest-priced companies often earn their reputation with poor service, hidden fees, and inconvenient locations.
  “You do, at times... get what you pay for. And those reviews, I think, are evidence.” – Joel (48:01)
• Review Quality Matters:
  Ignore bad reviews at your peril—even major brands can have bad local franchises (48:26).
• Paying More is Worth It—Sometimes:
  For travel, time, reliability, and peace of mind are often worth paying a bit extra (50:48).
• Book Smart:
  Use Costco Travel for reliable deals, and always reshop your booking as prices can drop before your trip (52:10).
• Alternatives:
  Turo and AutoSlash are mentioned for potential savings or better experiences.

4. Married & Exceeding Roth Income Limits—What Now? (35:44–43:40)

Listener Chelsea’s Question:
After getting married and filing jointly, Chelsea’s household income exceeded Roth IRA limits. What now, and what to do with earlier 2025 Roth contributions?

Insights:

• Celebrate Earning More—but Adapt Strategy:
  Exceeding Roth limits is a "good problem," signaling financial success (37:02).
• Backdoor Roth IRA:
  If you don't have a traditional IRA, consider non-deductible IRA contributions, then convert immediately to Roth. Watch out for the pro-rata rule if you have existing traditional IRA funds (39:41).
• Handling Ineligible Contributions:
  You must “recharacterize” excess Roth contributions—convert them to a traditional IRA and file IRS Form 8606 (41:09).
• Don’t Withdraw Contributions:
  Withdrawing can mean taxes and penalties; instead, fix the issue with proper paperwork.
• Why Not a Universal Roth?
  The hosts lament income restrictions and wish everyone could contribute regardless of income (43:21).

Notable Quote:
"Wishing everyone could contribute to a Roth IRA, no matter what their income." – Joel (43:25)

5. Debt Snowball vs. Avalanche (54:20–57:07)

Anonymous Poster:
Pay off cards with highest interest rates ("avalanche"), or start with the lowest balance for more motivation ("snowball")?

Insights:

• Avalanche = Lower Interest Paid:
  Mathematically optimal: pay off highest-rate debts first.
• Snowball = Emotional Wins:
  Paying off the smallest balances first fosters momentum and higher likelihood of staying motivated (55:25).
• Choose What Works for You:
  Most credit cards have similar high APRs, making snowball wins more psychologically compelling with little extra cost.
• Debt Consolidation:
  Options exist, but self-discipline and a clear plan trump most mechanical reshuffling strategies.

Other Notable Moments

The “Frugal or Cheap” Opener (03:06–06:42)

Fun banter on getting tattoos or ear piercings at deep discounts, with a lesson: only jump at a deal if it was already a thoughtful purchase.

Beer of the Week: Fat Pug Oatmeal Stout (07:55, 58:26–61:13)

The hosts share their opinions on the featured craft beer, debating whether it’s deliciously mellow or not noteworthy, using their characteristic blend of sincerity and levity.

Notable Quote:
"Beer is good for your heart. Just like Cheerios." – Joel (58:44)

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Timestamps for Key Segments

• 07:50 – Hayden's homeownership windfall strategy
• 12:20 – Capital gains tax on duplex sale
• 15:48 – Why not to rush your big financial decisions
• 22:18 – Grocery cashback card strategy and annual fees
• 28:20 – Amex Blue Cash math & usage tips
• 32:29 – Reality of annual fee waivers: Matt's direct experience
• 34:41 – Military and annual credit card fees
• 35:44 – Married and over the Roth IRA limit: Next steps
• 39:41 – Backdoor Roth IRA & the pro-rata rule
• 41:09 – Recharacterizing excess Roth contributions (Form 8606)
• 47:13 – Evaluating ultra-cheap car rental companies
• 50:48 – Why paying more can be worth it for car rentals
• 52:10 – Using Costco Travel and reshop strategies for rental car savings
• 54:20 – Debt snowball vs. avalanche breakdown
• 58:26 – Fat Pug Oatmeal Stout beer review

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Memorable Quotes

• "You can essentially have your cake and eat it too." – Matt (15:03)
• "There's no amount of charisma... there's absolutely nothing that we can do." – Matt, on trying to talk Amex out of an annual fee (32:29)
• “You do, at times... get what you pay for. And those reviews, I think, are evidence.” – Joel, on cheap car rental companies (48:01)
• "Celebrate earning more—but adapt your strategy." – Joel (37:02)
• "It's really a question of math versus your brain." – Joel, on debt paydown strategies (54:20)
• "Beer is good for your heart. Just like Cheerios." – Joel (58:44)

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Tone and Language

• Conversational, friendly, humorous, and encouraging
• Non-judgmental, practical, and realistic about money decisions
• Occasional gentle sarcasm, especially about financial myths and societal expectations

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Conclusion

A lively, information-packed Ask HTM episode that proves even complex financial moves—handling windfalls, optimizing credit cards, strategic renting, and navigating retirement account rules—are approachable with the right mindset and clear advice. Joel and Matt mix actionable tips with thoughtful guidance that centers lifestyle happiness, flexibility, and doing what's right for your own situation.

Show notes and resources available at howtomoney.com — including calculators, articles about backdoor Roth IRAs, and more.

Best Friends Out!

Transcript

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[A]

Welcome to How2Money. I'm Joel.

[B]

I'm Matt.

[A]

Today we're answering your listener question.

[B]

I hope everyone out there had a relaxing recharged Sunday and that you are ready to get back at it. Man, it's Monday. Back to the back to the grind.

[A]

Back to the personal finance education in your ears as they say.

[B]

We do have listener questions. We're going to talk about the best cashback card for groceries. We're going to discuss el cheapo rental car companies, whether or not they're worth it. Joel actually I'll share a little bit of personal experience there as well, another listener is asking about what he should be doing with a lump sum that he is going to have in his hands, and we're talking six figures. So, yeah, a lot on the line here, but actually, maybe it doesn't differ all that much from if it was just 600 bucks. Looking forward to getting to all of those, plus more today. But, buddy, I've got a quick, frugal or cheap question for you. It's been a minute since we've done one of these. Would you get a tattoo if it was, like, 80 or 90% off?

[A]

Okay, here's. I have a question. Is it an inferior tattoo artist?

[B]

No, it would be. If it would be a tattoo that's perfectly. Maybe it wouldn't be, like. I don't know. How are tattoo artists rated? You know, there's a certain level of artistic ability that you're going for, so maybe that's a little bit different than the story I'm trying to parallel here.

[A]

But.

[B]

Yeah.

[A]

What would you do if it was solid? Well, okay, I wouldn't do it just if I wasn't interested in getting a tattoo. But my wife got a couple of tattoos earlier this year, and I have been.

[B]

Do you feel not nearly as cool as she?

[A]

Definitely don't feel as cool as she is. I don't feel as, like, edgy or interesting. But, you know, it's. As someone who likes art, I'm like, well, yeah, there's probably some art I'd be down to put on my body. If I knew the right thing I wanted to get for sure, I'd want the sweet discount. I'd want a much cheaper tattoo.

[B]

Okay.

[A]

So. But if I didn't want to get one, I wouldn't.

[B]

I don't know if you would buy the sale. Okay, good response. The reason I'm asking this is because in a similar way, did you hear that Claire's the teenage girl where you.

[A]

Get your ears pierced?

[B]

Yeah, it's going out of business. So I heard about this a few weeks ago, and Kate happened to be in the area, swung by. I think maybe she was going in there to pick up a gift, like a birthday gift for one of the girl's friends, and she saw that everything was, like 80 or 90% off, including ear piercings. So guess what she did?

[A]

She got some additional holes.

[B]

She got another. Yeah, Another. She's got more earrings now.

[A]

Yeah, yeah. Did she get, like, one of the nas in her nose?

[B]

No, she wanted to get a second one further up from, like, the traditional spot, I guess, on the. On the ear. But she just totally went for it.

[A]

And I was spur of the moment.

[B]

Spur of the moment. It's not typically something that she does, but here's the thing.

[A]

I was gonna say it doesn't sound like.

[B]

It doesn't sound like Kate. Yeah, it is something she had been thinking about. And so sort of like you were saying, it was already on her mind. She was maybe quote unquote, shopping for an opportunity. She was looking for a time to be able to get it on discount. And, dude, it was. I think she paid 20 bucks. It was a 20.

[A]

What does it normally cost to get your ears pierced?

[B]

Well, we took one of our daughters on her birthday last winter, and it was 250. What is a nice.

[A]

You should DIY that at home, Matt.

[B]

It was a very well reviewed place. It was like one of these tattoo slash.

[A]

Especially a man of your skills and ability piercing places.

[B]

They're known for doing an excellent job over there. And so we paid 250. It comes with, like, you know, the earrings and whatnot, but still 250 versus $20.

[A]

For real.

[B]

Kate was definitely feeling pretty good about the deal that she was able to see. I believe so. In a similar way, I guess, if. So, what I asked you was. I assumed you have thought more seriously about a tattoo than you have an ear piercing.

[A]

But my question for you is now, are you so attracted to that deal that you're gonna go get something pierced on your body?

[B]

That was literally the last day. So it's why. It's a. It's a part of why she did it, because they. They said, hey, we actually. We're not allowed to do any more piercings here after today. So I think she was maybe one of the last ones particular Claire's. The lady was also trying to talk her into buying some diamond earrings because those were also. I think those were 80% off. But if you buy like 10 pairs, they're 90% off.

[A]

Then you're talking about. She could have started, like an arbitrage.

[B]

Yeah. She could have started like an ebay business.

[A]

Yeah.

[B]

Like, they were real diamonds, like actual diamond earrings.

[A]

That's incredible.

[B]

I was like, where are they? She's like, I didn't get them. I was like, what?

[A]

Well, I will make sure to compliment her on her new ear holes next time I see her.

[B]

I'm sure she would appreciate it.

[A]

Yeah, well, yeah.

[B]

And I guess always be looking for a deal. That's the moral of the story.

[A]

I'm gonna. Yeah. If I see a good deal on a tattoo and I Know what I'm gonna get? I'll pounce.

[B]

If you've the design, maybe you even have it saved in your phone. Maybe, you know, and you can be like, hey, can you do this?

[A]

Yeah.

[B]

Can you bust out this folk art? Bear head. I know that's one that you've been.

[A]

That's been. Yeah. On my radar.

[B]

All black cat tips.

[A]

Right? He's the best. All right, let's mention the beer we're having on the episode. This one's called Fat Pug Oatmeal Stout by Maplewood Brewing. I've never had a beer by this brewery before.

[B]

I don't think they're out of normal. What a funny town.

[A]

Illinois.

[B]

Normal, Illinois.

[A]

Okay. Yeah. So, yeah, we'll give our thoughts on this one later on. And it's kind of stout season, so we're getting in there.

[B]

I'm pretty excited about it.

[A]

Yeah.

[B]

Also super fun to say fat pug.

[A]

I don't know if you're allowed to call pugs fat. That's just rude.

[B]

That's who they are.

[A]

Yeah. I think it's an abrasive name for a beer.

[B]

It's acceptable.

[A]

Yeah, I guess you're right. All right, if you, by the way, have a money question, we'd love to hear from you. Go to howtomoney.com ask or just record your money question on the voice memo app of your phone, email it over to us. It'll take you about two minutes, and then hopefully we can take it next week on the show. Matt, let's get to a question from a listener who has gobs of money in his hands right now. He's trying to figure out how to proceed.

[D]

Hey, Matt and Joel, this is Hayden from Marlboro, New York. My wife and I decided that we were tired of homeownership, and we decided to become renters again. We just sold our primary residence and we walked away with a little over 300,000. We're also going to sell the duplex that we own, and we should walk away after everything with another 300,000 from that. We don't need to worry much about retirement. We still have 25 years, but my wife and I max out our 403Bs, our Roths, and we'll each have New York state pensions upon our retirement that'll pay us about 65% of our final average salary. We also contribute a lot to my daughter's 529, so our salaries more than cover our rent, our one car, our other expenses. So since we don't need this chunk of Money for another home purchase. What's the best way to make this money work for us? Cheers.

[B]

Hayden, you're not gonna buy another home. That's the only ticket to building wealth. Hayden, you know that.

[A]

It's the only way you can be considered a true American.

[B]

Yeah.

[A]

Otherwise you're just a freeloader.

[B]

Obviously, we're joking here. Despite the equity that you've been able to accrue. Huge congrats on that. I, I really appreciate. I can totally respect the fact that Hayden, that him and his wife decided that owning a home that it wasn't for him, you know, like, this is. He's just like, hey, this is my jam. I'm going to pivot. We're going to try something different.

[A]

I wonder what happened, by the way. Like, his. He. Sometimes there's a.

[B]

You think it got burned?

[A]

I don't know, like it. Did something happen to the home? And you were like, I can't deal with this anymore.

[B]

Going to do it again. Maybe.

[A]

Maybe like you had to have the AC repair guy out six times over this past summer and you're like, this is just getting absurd.

[B]

I'm done with it.

[A]

Yeah. Or the, you know, the crawl space flooded. I mean, there's all these sorts of things that can happen as a homeowner and homeownership. Yet, like, kind of like you're alluding to Matt is seen as this end all, be all. It's a smart financial decision, but it can take a toll on you, too.

[B]

Absolutely. It just depends on what you want to. What you want to sign up for. And I will say, generally speaking, it's a nice perk to be able to build up equity as you have purchased your own home. But there is a lot more to life than just maximizing every single financial decision. You're obviously doing a lot of the right things. You are talking about how you are. I mean, truly. I think he checked all the boxes. He even mentioned one car. Talk to me, Hayden. Like, oh, you are a fellow one car brother. I feel like we've got a kinship here. And with that in mind, not just because of the one car thing, but because you are. He's got the state pension. He's. Yeah, I think he's going to be just fine. Even though he doesn't have a home.

[A]

And still be able to retire.

[B]

Potentially even better with plenty of money.

[A]

Yeah. By. By not having the home equity, by renting and saving the difference.

[B]

And of course he's going to have more flexibility if he ends up wanting to move or try A new location. If life ends up being a little bit different in three or four years, it's going to be a lot easier to uproot, which it sounds like he's not worried about doing anyway, since he already did sell his primary.

[A]

He also might get a pretty sick deal on rent, depending on where he lives and what's happening in his particular market. Matt one of our favorite creators in the real estate space, Coach Carson was talking to his one of his most recent email newsletters.

[B]

First, first name Chad.

[A]

Chad. Chad Carson. Awesome individual, but just really smart real estate investor too. And he was saying how some of the properties he's on the longest, even being in solid condition, he's seen significant rent declines on some of those units. And so that's bad for him, bad for investors, but it's a great, great thing for a lot of renters out there because we'd seen those massive rent increases, especially in those early Covid days, and now it's like, hey, that trend is reversing a fair amount. So maybe you get top dollar for your home. Hayden and then you're able to have a lower monthly payment and then fewer updates, fewer repairs that you have to make because guess what, now the landlord is on the hook for that as well. A nice thing about selling your primary home though is that the gains you accrue are delivered to you tax free. That's one of the coolest things. Yeah, there's a lot of expense, realtor expense when it comes to selling a residence, but at least the tax man doesn't get his hands on that money. So Uncle Sam doesn't get a penny of your $300,000 in gains. And it's one of the reasons that like the live in flip strategy, living in that home for two plus years while you renovate, it can be a smart investing strategy because there's zero taxation, because it was considered a primary home that you lived in. We talked with our friend Carl back in the day about this, Matt. It's why he loves that strategy. He likes to do the work himself. Anyway, they live in the house while he's doing the work.

[B]

Last name Jensen.

[A]

That's right. And then they eventually sell the money, sell the house, and they don't pay any taxes on the gains they received. The duplex, by the way, that you mentioned, you're selling. So he's like getting out of the landlord game too. He's like, I'm just done with homes. I don't want to own one in any capacity. Well, that is likely to be Subject to long term capital gains taxes. You're probably going to owe something like 40, 45,000 bucks at the 15% long term capital gains tax rate on the $300,000 in gains you're going to experience on that one. So make sure to set that money aside. Make sure you don't forget to keep that around when tax time comes for April. And some people, they want to avoid taxes at all cost, even if it means holding onto assets that they don't like or that stress them out. It sounds like this is a success tax. It's worth paying. It's a small price, I think, to pay ultimately for the simpler financial life that you're looking to create for yourself.

[B]

Totally. Yeah. One thing I just realized is I think he said that they are planning to or they might be selling or I think he's planning he's definitely going to sell the duplex. But it sounds like it maybe is off in the future. And so with this in mind, you've got the ability to potentially avoid that possible 45,000 in tax were you to occupy that duplex. I know if it was me, I would seriously, I don't know, maybe it's not in the most desirable part of town or maybe it's in a different town. There's a whole lot of constraints here. But I would seriously be considering that because we're talking about avoiding taking almost $50,000 bath.

[A]

Yeah, just by the stakes are high.

[B]

Living in this great duplex that you've owned for a number of years. And I guarantee that two years is going to fly by when you're going to get a $50,000 more dollars in your pocket. Just something to consider. But let's assume that you already have sold it. So we're talking about what it is that you should do with $150,000. Well, now's the perfect time to dig down into your family's goals. I would start just asking some questions, like do I feel fulfilled here at work? Like maybe it's time to take a mini retirement. Maybe you're happy with that or maybe you're like, well, I don't want to jeopardize the pension, so I'm going to keep doing that, guys. Well, then maybe it looks like getting a little bit more philanthropic when it comes to the money that you're giving to local charities, charities that are globally. Or maybe it's just time for you to just continue investing just in a brokerage so that you can increase your options. Maybe you don't have like a clear path that you want to take now, but you're thinking, all right, well, let's be smart about it so that we can do even more good to have even more options down the road.

[A]

Because it doesn't sound like Hayden needs to put a lot more money aside in retirement accounts because he's already done a lot of that hard work. He's got the pension, too.

[B]

Exactly.

[A]

So think big here. Like, what can you accomplish?

[B]

He's basically saying his expenses are essentially covered. So he's kind of like, all right, I got a lot, a lot of things I could potentially do here. I think that Hayden's got the ability to make some just audacious moves without impinging on your ability to reach financial independence in a reasonable timeframe. So this is an opportunity, Hayden, for you and your wife to essentially have your cake and eat it too.

[A]

So I would.

[B]

This isn't like a one time sort of conversation either. Like, certainly sit down, some craft beer, maybe a bottle of wine, where y' all really do dig into what this could look like, but continue. You don't have to make a decision anytime soon. This is something you can revisit over the course of like the rest of this year, but even into the, the coming years. So that's something that I would most definitely be doing.

[A]

And that's, I think that's good advice. I think you probably don't want to make a rash decision. It's like after the death of a spouse, like, sometimes I think the biggest regrets people have is the super quick moves that they make. Whether it's life insurance payout or trying to figure out what to do with the house, they don't allow themselves to grieve and they make a big decision and then they're like, oh, man, if I felt like I was in more of my right mind, a better headspace, I probably would have done something different. The same thing is probably true when you're essentially cashing out investments to the tune of half a million dollars. You don't want to make a rash decision. Lock that money in some way that doesn't allow you to have some liquidity and some flexibility. Totally. And so, you know, I think when you're as far along the path as you are, Hayden, and you live simply, the world is your oyster here. And yeah, so, like, if the mini retirement sounds the most enticing, Matt, you just mentioned that I think you'd want to keep a bigger chunk in cash because that's an expense that you're going to have to fund. You might not have income coming in. You might be doing more extensive travel. So you're going to want to prioritize. You probably don't need all that money in cash, right, for a mini retirement. That'd be the most expensive mini retirement I've ever heard of. But you definite would want to keep some of that set aside in cash if you want to give big money away. And you're going to get a tax benefit for doing that as well. If you're smart, you can ramp up your donor advised fund contributions in the coming years, maybe big chunks in 20, 25, 26 and 27. Getting tax benefits. You're also just ramping up your ability. You're kind of garnering that nest egg for future giving. And then beyond the Roth ira, the taxable brokerage account is a great place to store medium term money that you're not quite sure what to do with. You keep it liquid as long as it's invested for more than a year. You're talking about the long term capital gains tax rate when you do pull money out of that account and it allows you to make big moves when you feel compelled. Like let's say you do say, man, you know what, three years down the road we really do miss homeownership. Or yeah, our life has changed substantially enough that we're considering buying another investment property. We're considering. Well then you still have access to that big chunk of cash and that chunk of cash has grown because it's been invested. So most people don't have access to a six figure stockpile that's also going to be growing and compounding along the way. I think the taxable brokerage account is a great way to make a smart move with the majority of the funds. That doesn't really compromise your ability to change course in the future as, as you desire as those goals become more apparent. That's right.

[B]

One other thing I just thought of too, your conversation with Cody Garrett last week. He talked about, he said he subscribed to fire the financial independence, recreational employment. Oh yeah, and I really like that. The ability, Hayden, for you to potentially pivot in your career. Again, you probably want to make sure you're not losing out on the pension. You don't want to sacrifice that. But finding, I don't know, at some.

[A]

Point if you've got enough money and you're like this job kind of stinks.

[B]

It might be time.

[A]

Yeah.

[B]

But finding ways to leverage your time. Right. Like the ability for, not only for you to align your money with things that you care about, but also your time man. To me that sounds like a recipe for happiness, so I think that might be something worth considering as well. But Joel, we've got more to get to. We're going to hear from a newlywed couple. They've got an investment question that plus more right after this.

[E]

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[B]

That's right. It makes me think you mentioned kids, Joel. I might be done having kids at this point, but my friends, my neighbors, they aren't. I've got family members who have a fresh baby at home as well and it is such an amazing season of life. But those changes should also bring about a reassessment of whether or not you've got your estate planning ducks all in a row. And Trust and Will makes it simple and straightforward. Their easy to use website is simple to navigate and plus all your information, all your documents, they are securely stored with bank level encryption.

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Add some peace of mind to your future with Trust and will go to trustandwill.com howtomoney for 20% off. That's 20% [e-mail] howtomoney all right Matt, we're back. Let's get to a question about credit cards and is it Some of the best credit cards have substantial annual fees, but is there a way around that?

[F]

Hello Joel and Matt, this is Roy from the DFW area in Texas. I want to ask you guys a two part question when it comes to your individual approaches to annual fees on credit cards. My wife and I are looking to get the Amex Blue Cash Preferred card to take advantage of the 6% cash back on groceries for up to 6k spent annually and we predict we should hit the threshold by the end of the year. However, I know the caveat with this card is after the introductory year of having your fee waived, there's the expectation of paying the $95 fee every following year. I recall you guys mentioning before, you can always reach out to these lenders and request to have your fee waived as a courtesy in that following year. But let's take that scenario further to a year by year basis. For the long term, could that approach still be feasible on a yearly basis if you're able to present a charismatic or justifiable enough reason to the lender and having the fee waive, Is this something either one of you have ever successfully done or continue to do? If so, how have you managed to pull that off? Onto the second part of my question. Could waiving an annual fee on a card every year be considered frugal or cheap at some point, it seems like the lender may put their foot down and quit waiving the fee, or the individual making the request could reach an ethical fatigue to where it may make more sense to quote, unquote, pay what you owe to the generally worthwhile benefits that most of these cards with annual fees may offer. I would like to sign off by thanking you guys for all the insight you offer on various financial services spectrums as well as life in general. As has helped me reach Money Gear 4 in about two years with my sights to begin Money Gear 5 in 2026. I look forward to listening to this show for many more years to come, including during the sabbatical periods you guys will surely take along the way. Best friends out.

[B]

Joel, I like how Roy mentioned that it's not just the money stuff that we talk about, it's also the life stuff.

[A]

Yeah.

[B]

And you and I were just recently talking about how personal finance, that's our sandbox, right? Like that is the world that we live in. These are the headlines we pay attention to, the rule changes, policy updates, things like that. But also it's not, I don't know, I'll speak for myself personally. Like, I find money very interesting, but it has more to do with the ability to use that as a tool to lead to a happier success, successful, fulfilling life. And I appreciate that. Roy appreciates that. Yeah, Roy, I appreciate you appreciating us.

[A]

At some point, at some point it's, it's impossible not to, to have those broader conversations as you start to figure the money stuff out. Like how does, what sort of implication does this have for how I live my life? Exactly? And to me, those, that intersection, that overlap are some of the most interesting conversations, most fun conversations that I get to have. And it's, it's some of the most fun conversations you and I have that I have with Emily. Because yeah, you get to, you just have this freedom, this choice, this ability at some point in your money journey that gives you where the optionality is significant and the things that you can pull off, whether it's mini retirement, I guess, or a sabbatical is what we're calling it really, Matt, that you and I got to have or just bigger giving goals. And that's what we want all of our listeners to ultimately experience. By the way, the best phrase that Roy used in that question was ethical fatigue. I'm going to use that in the future. Sometimes I get fatigued ethically, but obviously massive. Props to Roy for reaching Money Gear number four in what sounds like short Order. And let's talk about credit cards, Matt. We're not against annual fees because if you're savvy, if you're, if you're smart in the credit card space, which half of Americans are not, so you got to be careful. You can easily get more value out of the cards that you're using than the cost of the annual fee. But also, as we discussed not so long ago, some of the newfangled travel credit cards, the revamped credit cards from Citi and Chase and Amex, well, they offer cash back for more upscale spending. It's like, oh, do you spend a lot of money on that peloton subscription? That's how you're going to get money back. But you have to spend a lot. You have to fork over a lot of money in order to get the perk back. So we would just say be careful before signing up for the super fancy cards because using credit cards for spending you're already doing in order to get rewarded, that's cool. But spending money that you otherwise would not have spent in order to reach that threshold, like, well, guess in order to get 100 bucks back, I need to spend 500 bucks over here. That doesn't make much sense unless that product is really adding a lot to your life and you would have paid it anyway. So find a credit card that rewards you for how you spend and if it doesn't, after a while, like downgrade or ditch that card.

[B]

Yeah, specifically I'm thinking of like one of those travel cards was the City Strata card.

[A]

Oh yeah.

[B]

It's got like a $600 annual fee. That's so much money that I don't think that's one that Joel, that you nor I are even considering.

[A]

But I will say it, some of those cards do make sense for some.

[B]

People, especially if that's how you spend your money, go for it. Not me.

[A]

I think they're really marketed for my blood at like dinks in big cities where you're into kind of the finer things in life and you are doing more, more traveling and you're staying at those higher end hotels. If that's already you, then those cards can make a lot of sense. But if it's not, then it might be more like square peg in a round hole.

[B]

That's true. But Roy was talking about spending on groceries, so he mention the American Express Blue Cash preferred card. It is still a great card if you pay attention to the particulars, to the details. And the first year is even more beneficial because, yeah, you can avoid the Annual fee. When you sign up, you can think of the. The signup bonus that you receive after that initial spend as covering a few years of the annual fee as well. See, I don't know. There's almost like a feeling of getting it for free for a few years.

[A]

Yeah. Even though it's technically not waived. While the, what, $250 signup bonus, typically on that card, it's going to feel like it covers a few years.

[B]

But then once the annual fee kicks in, is it going to be worth. Will be if you spend the $6,000 on groceries each year, because that's $360 in rewards for that category alone, which obviously far surpasses the annual fee. But I do think it's a card that a bunch of how to Money listeners would benefit from. And essentially there's a threshold and you need to be looking at spending at least $3,000 on that card. Otherwise you can just roll with the blue cash, the everyday blue cash card that has no annual fee, and you're getting about the same benefit from that card. Anything above that, it's. Yeah, it's gravy on top.

[A]

One thing you realize because you use that card regularly is that you were getting close to that $6,000 spending limit earlier in the year. And so there's no extra benefit to you because it goes down to what, 1% after hitting that $6,000 cap on groceries. So you got to switch the card you're using because you get it turns.

[B]

Into a big old stinker of a card.

[A]

That's right.

[B]

After which. Which. That's something that snuck up on us because we were used to not spending that much. This is pre pan times, folks. Like when we could feed our family for $1 a day per person, per meal. Those are the good old days, essentially. I don't think we were eating.

[A]

Sounds like Little House on the Prairie.

[B]

I know, but we basically hit that spend amount roughly halfway through the year now. So that's when we make the switch.

[A]

Yeah. So keep that in mind because if you continue to use it getting 1% back, then you're too loyal to that card. The only other category that you'd want to use the Blue cash preferred on streaming. Because you get 6% back on streaming services too. You and I, Matt, we're not big streaming people, but if you have multiple services, 6% back on, if you're really into it, pretty solid.

[B]

I will say, even though we've hit the 6% on groceries, I still have that card tied to rideshare because it's 3% on transit. And so all my Lyft and Uber. I know recently I totally shot down Uber, but I still like hopping in an Uber X I don't think is Uber black. Is that the fancy car?

[A]

I think so.

[B]

No, I just get the cheap.

[A]

What's the big one? Because I had to use the bigger. Is it Uber X? Is that the or Excels?

[B]

Uber xl? Yeah. For like a Suburban or something.

[A]

Yeah, I had to do that because for your trip on my backpack there was like three dude backpacks in there that were enormous, so.

[B]

And we're big burly dudes sometimes.

[A]

Okay. But the big question that Roy had was, can you get the annual fee waived on a credit card? And I'll tell you this, Roy, it's harder than you might think. And that is because most of the premium credit cards, they're just not going to budge on their annual fee. Right. They'll say, well, if you're not getting enough value from the card, you can just downgrade. We've got this other card, like you mentioned, not the Blue Cash preferred, but. What's it called, Matt? Just the regular.

[B]

The everyday.

[A]

Everyday Blue Cash. Yeah. Okay, so you can. They'll say, oh, you're not getting enough value from this. Well, we can't waive the annual fee, but we've got this other card that's a good fit for you. And because of that, it's rare that they're going to say, oh, you called in to ask, sure, we'll do away with this because they have another option for you. And it's a really big part of, of the business model that these credit card companies run. If they were just like waiving annual fees all the time, then the structure of these cards, they wouldn't be able to offer some of the perks that they offer. So you can always call and try. Sure, I don't see any shame in that game. But how likely are you to succeed? We would say minimal possibility.

[B]

Yeah. Yeah. The term he used that you mentioned at the very beginning, ethical fatigue. I don't see any ethical dilemma at all in asking like this. This is business. And so they either have permission to grant you the $95, whether it's via credit, or just straight up to refund that fee. But I realized I've had my card for a while and I'm like, oh, I haven't. I personally haven't even tried to waive that fee. So I actually reached out to amex this morning and no luck, because. Exactly what you said, Joe. They're essentially like, oh, this is just how this works. There's no amount of charisma. There is no amount of justifiable evidence that I was able to. Able to provide. Roy, that's one of the other things you said. It's like you're picturing it more like you're sitting down with like a mom or pop kind of landlord of like. But what if I do have a dog, but I take care of the lawn? Okay. Hey, there's a conversation to be had there.

[A]

Right.

[B]

As opposed to Amex. There's no. It's either yes or no. And it doesn't. I don't think it really matters how much you push because I push pretty dang hard. And at the end they're just like, we really appreciate you being a customer since 2012, but there's absolutely nothing that we can do.

[A]

Just gonna throw that polite decline your way and suggest another card. If this one doesn't work. Sure.

[B]

Which is what they did. And. Oh, man. Two things. Okay. It's one thing to expect and to feel like you are entitled to a credit. And that's not what we're advocating for here. That's not what we're all about here on the show.

[A]

The Shadow 2 would be not cool.

[B]

Yeah. But secondly, I'm just realizing myself that when I had talked about this card previously about hitting that $6,000, I mentioned that I switched to the Citi Double Cash card to get the. At least get the 2%, which is better than the 1%.

[A]

Yeah.

[B]

I need to get a stinking everyday card because that's 3% and it's free.

[A]

That's true.

[B]

What am I. What am I doing?

[A]

I could leave a 1% on the table.

[B]

One more percent if I'm looking to optimize. And so that's true. That's going to be the new how to money Matt grocery approach. I'm going to rock that every day. I'm sorry. I'm going to rock the blue Cash preferred up until that 6,000. And then I'm going to switch over to the 3% card, which is free. So there's no additional charge there anyway to even consider using that card for the rest of the year.

[A]

Smart man.

[B]

Boom. Slam dunk.

[A]

Yeah.

[B]

I love it.

[A]

Look at you figuring this stuff out on the fly.

[B]

I'm jacked.

[A]

Oh. I do want to highlight that the one case in which it's actually much easier to get an annual fee waived is if you serve in the military. And that's. There are federal regulations specifically on what credit cards are allowed to charge active duty service members as far as, like, interest rates, Think of the cap is like 6% or something like that, which is much lower than what normies are charged.

[B]

22% now is the average.

[A]

Yeah, something like that. But a lot of card issuers don't just limit the interest rate. They also waive annual fees for active duty service members as well, even on some of those super fancy elite cards, even though they aren't required to. I think amex is actually one of the better credit card companies at this. So if you are an active duty service member, you might want to strongly consider getting one of the nicer cards that has, like, a $700 annual fee because you get all the perks, but you don't get any of that downside of having to fork over a big chunk of money to the credit card company every year, too.

[B]

There you go. Let's hear now from a listener who is having a tough time participating in one of our favorite investing accounts.

[G]

Hi, Matt and Joel. This is Chelsea in Franklin, Massachusetts. My partner and I got married in April this year, and we were both contributing to our Roth IRA account. However, now that we're married and plan to file our taxes jointly, we've hit the income limit and can no longer contribute to the Roth. We were told that we can open a traditional IRA account and contribute there. So we did do that, but it made me realize that that's still technically after tax dollars that we're putting in, So I wasn't sure if that's actually allowed. Also, since we've already contributed into the Roth IRA for the first part of the year, what do we need to do, if anything, with that money that we've already put in? And if the traditional IRA is not allowed, what do we do with the money that we've already put in there? Thank you, Chelsea.

[A]

Congrats on getting married. Pumped for you guys.

[B]

I see the sadness in your eyes that you weren't invited to the wedding party.

[A]

I was just gonna say you're disappointed you weren't asked to officiate.

[B]

Oh, man. Nobody wants me to officiate their life.

[A]

Would you get that online certificate and do it if a listener asks you to?

[B]

Oh, man. I think I'm. I would seriously consider it. I think I would, too, because of the honor. Like, if it's your most. The most important day for you and your partner, even though this isn't necessarily, like, a life goal of mine, I would feel obligated to, like. All right, time for Matt, old Matt to step up to the plate. I gotta deliver.

[A]

You really want.

[B]

Yeah, I'll do this for you. Exactly. Plus, if there's a good local craft brewery, I'm like, all right, make it a two for one.

[A]

Or maybe, hey, maybe they got good craft beer at the reception afterwards, like some good homebrew. Yeah, that'd be cool. But so other. Other how to money listeners, if you're planning on getting married soon and you want Matt there, just reach out.

[B]

Or Matt, what if it's a dual efficient sort of setup that we got going on?

[A]

That'd be first time for everything. Let's go for it.

[B]

Oh, man.

[A]

Okay.

[B]

They would probably be like. They would be afraid of what would happen on the mic up front because they listen to the podcast and they're like, well, I don't want that. But. But also at my wedding, what weird.

[A]

Off the cuff stuff will they say? You never know.

[B]

I think I'd be too nervous. I would completely stick to whatever was written on the certificate or whatever.

[A]

I would think that potential listener should be more nervous because I might go off script and you might not like it. Let's talk about Roths, Matt, because I'm glad that Chelsea's been able to contribute to a Roth recently. In some ways, it sucks that you can't do a direct Roth contribution anymore, but it also means that you're making good money, which is a great thing. So I don't feel too bad. It's a good problem to have. And it basically means that you're making more than a quarter million dollars a year, which is a killer combined salary. So props to you guys for that. I know it's probably a ton of hard work to get there, and it just makes it so much easier to build wealth if you're diligent on a high salary. Matt, that was one of the things that talked about with Nick Magiulli not too long ago. He's like, that's the biggest problem for a lot of people is they just don't make enough money. It's also true that a lot of people earning six figures are living paycheck to paycheck because they haven't really figured out the personal finance basics. But Chelsea's in a great spot because she's got both. She's got the personal finance basics down, and they're making a killer income at.

[B]

The same time, as well as a happy marriage. I'm sure it's been nothing but butterflies and rainbows up until this point. Right, Chelsea?

[A]

Yeah. I can speak for her and say yes. Okay.

[B]

Hopefully it has been so, Chelsea, one way that you might see this is why they don't want us to officiate.

[A]

You never know what we'll say.

[B]

Their wedding, the awkward thing. Oh, my gosh. Okay. You could qualify to directly contribute to your Ross by moving more of your money into your workplace retirement accounts, basically by upping, let's say, a traditional 401k contribution. That right there could bring your adjusted gross income below the Roth IRA income limit threshold, which would allow you to then funnel money into your Roth IRAs directly.

[A]

Always worth considering.

[B]

Yeah. It's like if you're really close, I certainly want to mention this because it only works if you're within earshot essentially of that limit. And of course, if you are, you got to be keen on investing more. Otherwise you should consider a backdoor Roth. And we've got an article up on the slide that we'll link to. But essentially, you are making a non deductible contribution to your traditional ira, and then you are going to immediately roll that over into your Roth IRA. You're still going to be able to put $7,000 there into that Roth. But you need to be aware of the pro rata rule if you already have money there in a traditional ira. Basically, it's easier if you don't have a traditional and you're opening it for the first time for this backdoor Roth maneuver. But if you already have one set up, basically there's just a lot more tax. Keeping up with taxes and what's already been in there and making sure it's taxed at the proper rate.

[A]

If you've got, let's say, six figures in the traditional ir, you're trying to do the contribution to the non deductible traditional IRA and then do the rollover. You could be making a big messy tax mistake.

[B]

Yeah, it doesn't even require a large amount of money in the traditional. Even just like any money that's in there is going to complicate it from a tax perspective. And so if that's the case, it's not a huge deal. But that would be something, for instance, that you would want to discuss with your cpa, with your accountant. It's something that they come across fairly frequently, I guess. Well, maybe it just depends on who you're working with.

[A]

Well, my guess is that that Chelsea also probably doesn't have that problem because she's been prioritizing the Roth up until now. So if I were venturing to guess, Matt, I would think Chelsea probably doesn't.

[B]

Have probably keeping it simple, taking the standard deduction.

[A]

Yeah. Which, which makes her ripe for the backdoor Roth. Makes it a great idea because she's not going to mess with that pro rata rule.

[B]

It's probably true.

[A]

And then what do you do if you've contributed to a Roth, but you're now ineligible? So basically you put the money in and then you're like, wait a second, not allowed to do that. Well, that happens regularly, too. People just figure out they're going to make more. They don't qualify based on income requirements anymore. Well, the IRS wants you to recharacterize the money you've already contributed. So you can go in through your brokerage account, you can change the Roth contribution to a traditional IRA contribution. And there's a specific form you need to send to the IRS after doing this, which is, is a Form 8606, Matt.

[B]

8606.

[A]

You've done this before. Exactly. Yeah.

[B]

Yep.

[A]

And you could, you could also choose to just withdraw the contribution and the earnings before the tax filing deadline. You'd only be taxed on the earnings plus a 10% penalty. It's likely not going to be a huge amount because it's not been in there for very long, but it would still go against your goal of saving for retirement and getting money into a Roth ira. And.

[B]

Yeah, just based on. Yeah, don't do that just based on principal, even though it's a small amount, because, you know, whatever 7,000 has grown into from earlier this year, and that's assuming a lump sum investment at the beginning of the year. Although I guess if she's dollar cost averaging, she would have seen even more growth because of where the market tanked to there in April. Regardless, you want to make sure that you fill out that form 8606, file that when you file your taxes for 2025 also. That's the same form. So essentially what you're doing when you do, when you execute a backdoor Roth IRA contribution, it's the same thing. It's essentially intentionally doing the recharacterization. So you also have to file that form 8606 when you execute a backdoor Roth IRA as well. So you can get familiar with that if that's something that you think you're going to be participating in. You're talking about penalties, Joel. Right. So you've got the 10% penalty. You're taxed on the earnings were you to just simply withdraw those contributions. Another penalty. If this is something that you don't fix which is. Does not sound like something that you're planning to do. Chelsea, you're looking to nip this in the Buddha, but let's just say you don't fix this. Well, There is a 6% annual tax or penalty that the IRS applies to these Roth contributions that you are making an error, essentially. And so every year you don't fix it, those penalties are going to accrue. So it certainly behooves you to do this quickly. But moving forward, getting that money into a Roth, it's still possible, and it's a very brilliant thing to do to avoid all future tax liability completely. You just gotta jump through the proper hoops in order to not run afoul of the irs.

[A]

Wish it weren't so complex, wish it weren't so annoying, and that, hey, you're trying to do the right thing. And then you gotta make things right with the IRS on the back end. Wish it were simpler. It's not. But that is the way you clear things up and still get money into your Roth ira.

[B]

That's right. And it's really not that big of a deal. The 86.

[A]

Do away with it, though. Matt is your friend. Why can't everyone contribute to a Roth ira? Matthew, that's what I want know.

[B]

Yeah, well, that would be the Peter Thiel approach in should he be eligible for Roth ira. But somehow he found a way.

[A]

He found a way.

[B]

I mean, it's like water. Water always finds a way.

[A]

Just from a theoretical standpoint, it does seem like just the. The fact that we cap contribution amounts at 7,000 per person, that despite your income, like, why not? Why not? And because of the availability of the backdoor Roth ira, to the fact that high income earners can still get money into a Roth.

[B]

It does feel different than, like a Solo 401K, where it's like you can put, like, tens of thousands of dollars into this thing.

[A]

Oh, yeah, that's not.

[B]

We're talking about. Yeah, just $7,000, but. All right, we got more to get to. We've got our Facebook questions of the week, buddy. We're gonna talk about the classic conundrum of which credit card balances to pay off first. We'll get to that more right after this.

[A]

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[B]

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[A]

All right, Matt, we're back. We've got a classic personal finance question to get to here in just a second. It's classic, but first let's get to the Facebook question of the week. This one comes from Matthew. What is everyone's experience with the best rental car company when traveling? I found some that are only $100 for the week, which sounds incredibly cheap, but others that are $400. So a big disparity is what he's saying. The ones that are expensive are the ones with the best reviews, while the dirt cheap ones have horrible reviews.

[B]

Yeah, I'd be questioning whether or not the $100 a week one comes with like tires and like, what other fee? What additional fees are there gonna be that they're gonna force you to cough up in order to actually leave the lot with the car?

[A]

You know what just sprung to my mind was the time I bought the knockoff Atlanta United jersey.

[B]

Oh, yeah?

[A]

Yeah. And it was like off color. You get what you pay for. Nice material.

[B]

The stripes were totally like the wrong size.

[A]

Yeah. And color. And it was one of those things where. But this jersey's 20 bucks and the official ones through MLS are like 80 bucks. And I don't want to drop that kind of money. And yeah, but I looked ridiculous wearing it around. And so, yeah, you do at times, many times get what you pay for. And those reviews, I think are evidence. And so some of these second rate car rental companies, Matt, are indeed awful much of the time.

[B]

Okay. So I. So speaking of reviews, this is to my detriment. I ignored some reviews at a local car rental place and they had. It's the one that you. I'll say it, it was budget. And everyone's heard of Budget. Right.

[A]

It's a name brand.

[B]

It's fairly reputable. But this particular location had abysmal reviews. And I said, you know what, I'm. No, no, I've got the deal. They've got the deal going on there. I'm gonna pounce on the opportunity here to save a ton of money. And guess what? They of course did not have the vehicle that I had reserved. It led to a mass, like an hours long headache.

[A]

Let's be honest. That is also a car rental thing in particular where they don't have the. They know how to take the reservation. They just don't Want how to keep the reservation?

[B]

Well, I will say their parent company Avis, which I have subsequently rented from, was fantastic. And so I don't know if this was just an instance of feeling burned in a given situation, but because of that, guess what? I'm much less likely to rent from them. Even though there are plenty of folks who would probably swear by Budget and they're like, no, man, I love Budget. Never had a problem. They're my go to the guy that works there. We're buds. I send him a Christmas card every year. You know, he's like part of the family. He comes over on Sunday.

[A]

That's weird. Don't do that.

[B]

Hey, if that's your buddy, if y' all got to know each other, it doesn't matter where it is that you originally met. So all that said, I ignored the reviews. Reviews are really important.

[A]

Yeah.

[B]

And yeah, going with one of the more reputable names, I think.

[A]

Yeah. Especially I think what Matthew's getting at is there like these really subpar non name brands, second tier, third tier, almost just crappy companies that and the reviews are so horrible because. And I've been, I've done the same thing. I've rented from one of these places.

[B]

Feels a little more fly by night.

[A]

Yeah. Often the location is further off the airport. It's harder to get to and the people working there don't seem to care nearly as much. And maybe there are additional fees that you weren't told about ahead of time at the booking. And so the deal is not even as good as you thought it was going to be. So I would just say think about all those things. Read the reviews thoroughly. Don't just look at the star rating. If the savings are substantial and you've got flexible travel and you're keen to give it a go because you're that kind of person. You like, you're the experimenter, you do you. But those reviews might be enough to freak you out and prevent you from giving it a go with some of the non name brand car rental companies.

[B]

Especially when you consider when it is that you typically rent a vehicle, which is when you're out of town, you don't typically have other options and you're typically on a tighter time schedule. You've got reservations, you've got different. Oh, our entry for the museum is between these hours, like every minute counts when you're on vacation, typically the way we Americans schedule our vacation.

[A]

Joel.

[B]

Right. Like it's. So there's like zero margin, which honestly that should be a referendum on how it is that we relax and how we vacate our homes. But that being said, I am now more at the point to where I'm willing to pay a little bit more in order to ensure that I'm not gonna be stuck there, A, without a vehicle that works for our party, our group, but B, just waiting in lines too, man. Like, that's the other part of it. Like, I don't wanna spend like an hour. And I've had this happen before too. I'm thinking about one time I flew into Detroit and I was supposed to make a certain dinner by, like, a certain time. And I stood there in line for like 40 to 50 minutes, one person working the counter. I swear it was that one person that was also, like, going to get the cars too. Like, it wasn't like, oh, yeah, the keys are.

[A]

They were also washing the cars.

[B]

Oh my gosh. So that's not the kind of scenario that I want to find myself in. That being said, you don't have to pay off the nose in order to ensure that you're getting a good company. I know. Well, you. You use Costco. Recently, I feel like Costco Travel rocks. It's so good.

[A]

It's super simple. The grid format they display. If you're a Costco member, it's a great place to turn. They've got like five different rental car companies that they'll list and depending on the make and model of the car or basically, you know, are you going for a compact? Are you going for a pickup truck, Are you going for a van? They'll tell you, well, hey, which one offers the best deal right now that's a great way to shop. But then I think the other most important way to save on rental cars, Matt, that most people don't think about. Most people, like, they book it, they forget about it, and then they show up and they get the car that they booked. Well, if you reshop regularly before your trip, you could see substantial savings.

[B]

You manually checking now or are you doing Auto Slash?

[A]

So Auto Slash is awesome site to help you with that. But I like to. I don't know, I'm weird. I like to manually check back in. So. Checked back in yesterday on a car rental that I've got upcoming and I was like, the gas electric disparity was significant. Well, it's gone down. And so I'm like, great, I think I'm actually going to get a gas vehicle. Just. I don't know. The EV is going to quite do what I need it to do. Sadly, on this one yeah.

[B]

You don't want to get stuck in the situation that I found myself in a few weeks ago where they're like, hey, it's actually, you're going to deal with some range, range anxiety.

[A]

But I was like, great, well, this is my perfect chance to rebook and guess what? But I'll probably reshop that two more times before the actual trip, so.

[B]

Classic Joel.

[A]

It's the amount you can save by doing that, which really, you know, plugging back in those dates and checking the pricing again takes all of two minutes. Yeah. And so that, that's the best way to save. Instead of going with the super duper low cost off brand, not going to be good or nice to you choice, just reshop instead. You'll. You'll. That's the way you'll save more and feel more confident.

[B]

Totally. Yeah. Don't forget about Turo as well. You might be able to find a deal over there by running from an individual as opposed to a company. Joel, let's take another one from an anonymous poster. I'm trying to pay off some credit card debt. I've got a couple with larger balances and a couple smaller ones. Is it better to pay off one to two cards or split the money to bring down all the balances? This is a debt snowball question right here. Whether or not this listener or poster should subscribe to that as opposed to the debt avalanche.

[A]

Right. And we'll describe what that means. But first off, I mean, it's really a question of MA versus your brain. And the math would say to pay the minimum balance on each card except for the card with the highest interest rate, you pay as much as you possibly can on that one particular card and you get rid of that particular debt in short order. And then once you've eradicated the debt from that first card, you move on to the one with the next highest interest rate. That's the best tactic from a math perspective. Right.

[B]

That computes.

[A]

Yeah. Because you're going to be paying it off while paying the least amount of interest overall. And that really is the debt avalanche approach. But when we're talking about the snowball, we're talking about, it's the best motivator for your brain, which is to pay off the card with the lowest balance more quickly, no matter what the interest rate disparity is. And then getting rid of a whole debt from your life more quickly, that just kind of of speeds up the process or makes you more excited about and motivated to pay off debt more quickly. So that's.

[B]

Yeah.

[A]

Is it better to go the math route or the more psychologically advantageous route? I lean towards psychologically advantageous. But it also kind of depends.

[B]

It depends on the situation. Yeah. Like a lot of times the criticism is that, like, well, if you're paying attention, paying attention to math, you wouldn't have started spending on your credit cards to begin with. But I do think there are some. There are certain scenarios where it's like, oh, yeah, over a decade. All of a sudden you look down and you got like four cards in your wallet with bounces on all of them. And then you've sort of, oh, the scales have fallen from my eyes. And I realized that I gotta figure some things out here. And in a scenario like that, I could see taking the more mathematical, which I'll say the mathematical is the brain approach versus the snowball, which feels more like a heart like emotion, like an emotional response.

[A]

I guess brain and math kind of probably go together and heart and emotion more go together.

[B]

Yeah, or like following your heart or your stomach, like you feel it. But I think that whether or not you choose the avalanche or the snowball, that comes down to your individual situation. Because also, practically speaking, if we're talking about a bunch of different credit cards, I think the snowball certainly can make the most sense. And that's mostly because the disparity between interest rates is unlikely to be that big. But if we broaden out a little bit and are talking about additional forms of debt, let's say we're talking about a 5% car loan that you are also trying to pay off in addition to these credit cards. Well, dang, even if it's the smallest amount, I would rather you say that one until after you've paid off all of the other credit cards first. But yeah, I think given the specifics to this anonymous poster, I would most likely go with a snowball because that's probably going to lead to the most emotionally positive, fulfilling response.

[A]

And that reinforcement matters. And you're right, probably somewhere between 19 and 22%. Each credit card is roughly in the same range. So pay off the lowest balance first, get that win under your belt, and then keep moving forward and pay off the next lowest balance. You could also consider something like a 0% interest rate credit card to transfer some of that debt to make it less disadvantageous. But whether that makes sense or not, it just really depends on where your head's at as well. Because if you're one of those extremely motivated individuals, it can speed up your process, but if not, it can lead to more credit card debt and a worse overall financial picture for yourself. You know, some people might suggest to you, debt consolidation, hey, it's going to help you pay off your debt more quickly. This is really the way. Well, you know, coming up with a plan and working your butt off to pay off that credit card debt quickly, I think that's likely your best path to take. Instead of just trying to move debts around, actually write down a plan and stick to it. Put it on the bathroom mirror, Matt. There's the undebt.it can help you come up with that plan. Figure out, hey, how can I cut my spending for a little while so that I can actually pay off this credit card debt in even a smaller timeframe? I think those are the kind of tweaks you're going to want to make so that you can get rid of it quickly. Whereas trying to shuffle things around, it sounds good and it seems like it's going to be the best way forward, but it gets a lot of people in even more trouble.

[B]

That's right, buddy. Let's touch on the beer that you and I enjoyed during our episode today. You and I split a fat pug, which this is an oatmeal milk stout. Not just a milk stout.

[A]

That's true. Yeah.

[B]

It's got oatmeal in it. Yummy.

[A]

Which is healthy for you.

[B]

Yum, yum.

[A]

Which is why we drink these beers. Beer is good for your heart. They're good for our heart, good for our bodies.

[B]

Just like Cheerios. Good for your heart.

[A]

That's right. So I didn't. I didn't love this beer. I thought it was kind of meh. Really? Yeah. I thought it was kind of bland. I was like, where's the flavor?

[B]

Y' all wanting more. More punch?

[A]

Yeah.

[B]

Oh, sorry. This isn't like Cobra Kai or some of these other massive barrel aged milk stouts with, like, serrano peppers.

[A]

It's very accessible stout, I guess for people who are, like, just trying to figure out whether or not they like them, it's not too offensive or overpowering from a flavor standpoint.

[B]

Yeah. So from a craft beer standpoint, you're kind of looking for a little bit more.

[A]

Yeah, I like it a little more.

[B]

It was toasty. It was roasty. Had all those flavors going on. It wasn't overly bitter, though. So sometimes some of those stouts, like a Russian Imperial, they're just really over the top From a sock you in the face.

[A]

Those can be kind of bitter and charring too.

[B]

Yeah. But with this being a milk Stout. It's got that lactose sweetness going on, which personally I love. And I've actually been. My typical coffee. Kate and I have both been upping the amount of milk we're drinking. And we're like. Because we realized we're like, man, we like never drink milk. And then we're always trying to get the kids to drink their milk because we're like, hey, we want your bones to be all strong and your teeth to be healthy. And they're like, when do you drink your milk? And Kayna looked at each other and we're like, oh, yeah, we don't really.

[A]

Take your own medicine.

[B]

I know. And so I was like, hey, that's a good point, actually. And so we started brewing slightly less coffee in the morning.

[A]

She's been like, don't talk back to me.

[B]

Get back to eating your eggs. But it reminds me of my coffee now, which tends to be a bit more milky, which I'm all for because we're also adding less actual granulated sugar because there is a sweetness in milk. There's a. You know that lactose.

[A]

When I put my milk just a little bit or in my coffee, just a little bit of milk.

[B]

Yeah.

[A]

Good to go.

[B]

I'm like. I'm putting like at least 4 ounces in there now. People are like, that's not even coffee.

[A]

Yeah, it's not.

[B]

It's like, that's probably equivalent to a latte or something like that. That's too much if I'm. Look, dude. Well, all the coffee purists.

[A]

Yeah, you are a coffee purist. I don't understand.

[B]

I see it as a different drink now. It's not the same thing. I'm not. This is not an espresso shot. This isn't enjoying a finely crafted cortado, something like that, even a flat white. No. I see this as like a coffee drink. It's not coffee.

[A]

Okay.

[B]

It's a coffee flavored drink that also has a lot of milk in it. I want to make sure my bones are strong.

[A]

I am judging you right now, but silently. I'm not going to say anything out loud.

[B]

Well, I'm sure there's plenty of other. I got a feeling I'm not the only one. I bet there's a lot of folks out there who add a healthy serving of whole milk to their coffee.

[A]

Okay. Please reach out to Matt. Support him. He can use it. Right now.

[B]

I need the support because Joel. Sure. Sec isn't doing it for me.

[A]

All right. Thanks so much for listening. We'll put show notes up for this episode on our website howtomoney.com including links to some of the stuff we mentioned today. There's even a snowball versus Avalanche calculator that we can stick up there, Matt, that can help people see the difference between that choice you can make from a dollars and cents perspective. So you know what? All right, until next time, Best friends out.

[B]

Best friends out.

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