Ask HTM - Condo Cold Feet, Investing in ABLE Accounts, and the Best Interest Rate Ever #1033

Summary

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How to Money – Episode #1033:

Ask HTM – Condo Cold Feet, Investing in ABLE Accounts, and the Best Interest Rate Ever

Release Date: September 8, 2025
Hosts: Joel & Matt
Podcast Network: iHeartPodcasts

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Overview

On this “Ask HTM” episode, best friends and co-hosts Joel and Matt field listener questions about real estate investing, managing special needs savings accounts, and tackling high-interest debt with an unusually low-rate line of credit. As always, they keep the tone fun and supportive, blending practical money advice with friendly banter.

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Key Discussion Points & Insights

1. Electric Car Rental Lessons (02:59–08:33)

• Matt shares a story about almost renting an affordable Tesla for a mountain trip, only to realize that elevation changes drastically impact EV range.
• Key Takeaway: Always factor in more than just mileage—including elevation and climate—when renting EVs.
• Negotiating in Person: Matt got a $60 discount for switching to a gas vehicle at the counter. “Just being willing to ask for a discount, look someone in the eye—it increases your chances. Don’t expect a discount, but it doesn’t hurt.” (06:41, Matt)
• Charging Realities: Joel relates a recent Tesla road trip—charging is user-friendly but doesn’t always save time or money.

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2. Listener Question: Condo as an Investment (09:34–21:55)

Listener John’s Question:
Has a condo near the beach in L.A., bought four years ago at a low interest rate (2.8%), now finding appreciation and cash flow underwhelming. Should he keep it?

Hosts’ Advice:

Ownership vs. Investment:

• Matt: “When you buy a condo or a single-family home, the main goal is going to be…to put a roof over your head.” (11:43, Matt)
• Joel: Homeownership isn’t guaranteed wealth—rapid appreciation shouldn’t be the sole goal. Think of any gain “like a cherry on top.” (13:48, Joel)

Cash Flow and Location:

• Joel: “In coastal cities, often landlords are losing every month, betting on appreciation. The fact that you’re making money—even $100-200 a month—in L.A. is already better than most.” (15:31, Joel)
• Matt: Surprised John’s condo didn’t appreciate much; urges revisiting comps and recent sales.

Golden Low Interest Rate:

• Joel: “A locked-in mortgage rate below 3% is almost…an asset in today’s environment.” (17:09, Joel)
• Matt: “It’s still a debt...but it feels like you’re making money.” (17:14, Matt)

Landlording Isn’t for Everyone:

• Joel: “It’s a part-time job, not just an investment. If you hate it, there are easier ways to build wealth.” (17:46, Joel)
• Matt: “You can hear it in your voice, John—it sounds like you’re not excited about it.” (18:26, Matt)

The “Right Vibes” Factor:

• Excitement and pride in the property help when renting and showing to tenants.

Tax Considerations:

• Selling soon (having lived there 2/5 years) lets you avoid capital gains tax on profits (20:21, Joel).

Exit Plan:

• Have a plan for where the proceeds go if you sell—ideally into appreciating assets, not spent on a whim.

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3. Listener Question: Saving for a Child with Special Needs & ABLE Accounts (24:57–32:24)

Listener Jennifer’s Question:
Mom of four, including a 10-year-old with severe special needs, asks: Should we stop 529 contributions for him and use an ABLE account? Any other suggestions?

Hosts’ Advice:

• Special Needs Trust is Essential: “If you have a loved one with a disability, chances are they rely on government benefits…a Special Needs Trust lets you set money aside without messing up their benefits.” (26:24, Matt)
• ABLE Accounts 101:
  • Tax-advantaged accounts for individuals with disabilities (onset before 26).
  • Lets families invest and save for disability-related expenses without jeopardizing benefits.
  • “The funds grow tax-free…when he’s older, a debit card can access the account directly.” (30:17, Matt)
  • Be mindful of the $100,000 threshold—SSI benefits can be suspended above it. (31:06, Joel)
• 529 Plan/ABLE Combo: You can have both; any excess in 529 (up to $35k) could be rolled into a Roth IRA if unused for education.
• Focus Recommendation: For non-educational lifetime expenses, priority should be the ABLE; for school-related costs, also use/spread between 529 and ABLE. (32:01, Matt; 32:29, Joel)
• Kudos for Preparation and Hustle: “It sounds like y’all are knocking it out of the park on a lot of different accounts here.” (27:52, Matt)

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4. Listener Question: Should I Use a 1% Line of Credit to Pay Off $50,000 in Credit Card Debt? (33:07–39:03)

Listener Mike’s Question:
$50k credit card debt at 22%. Has access to a 1% line of credit for six months. Should he do it?

Hosts’ Analysis:

• That’s an Insanely Good Rate: “If you really do have access to 1% line of credit debt…fill me in! I want to know.” (34:20, Matt)
• Be Careful About Collateral: Swapping unsecured for secured debt (like a HELOC) can increase your risk—especially if property is involved.
• Know the Terms: Is the low rate temporary? What happens if debt remains past six months?
• Math Favors Lower Rate: Shifting to 1% over 22% saves ~$5,000 in interest in six months.
• Behavior Matters Most: It only helps if habits change—otherwise, debt can return.
• Balance Transfer Comparison: “Reducing interest rate can be really beneficial, but you must be aware of your own human fallibility.” (37:51, Joel)
• Root Cause Reflection: “Do some soul searching—figure out the behavioral tendencies that got you here.” (39:03, Matt)

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5. Facebook Question of the Week: Is “Arrived” a Good Real Estate Investment Platform? (45:10–50:03)

Listener Nicole’s Question:
“Has anyone heard about Arrived, a real estate investing platform for passive investors?”

Hosts’ Take:

• Caution Advised: “Arrived is one of these crowdfunded sites…these alternative investment sites are the place I see people turning and then getting burned.” (46:07, Joel)
• Liquidity Risk and Expenses: High fees, low transparency, and sketchy liquidity make these platforms risky, especially compared to index funds.
• Not a Scam, Just Not Ideal: “There’s nothing seedy about these sites. We just don’t think you’re going to outperform.” (48:59, Joel)
• Active Real Estate Wins: “It is possible to achieve outsized returns in real estate, but typically you do that by owning and managing your own properties.” (47:54, Matt)
• Summary: Fun to say you own a piece of something, but not worth the risk or hassle for most investors.

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6. Listener Question: Tips for Opening a Roth IRA for a 12-Year-Old’s First Job (51:18–55:30)

Listener Theresa’s Question:
12-year-old about to get paid for house-sitting. Opening a Roth IRA for him at Fidelity. Tips?

Hosts’ Tips:

• Get the Child Involved: “Let him click the mouse…let him type in his name…that buy-in is important.” (52:38, Matt)
• Contribution Limits: Can only contribute earned income—not gifts.
• Fund Suggestion: Fidelity’s FZROX (zero-fee total stock market fund).
• Parental Matching: Consider matching what your child invests to encourage saving (up to their earned income).
• Benefit: “The more he piles into that fund…the more that thing’s going to be like a snowball.” (54:11, Joel)

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Notable Quotes & Memorable Moments

• “Homeownership isn’t guaranteed wealth—rapid appreciation shouldn’t be the sole goal. Think of any gain ‘like a cherry on top.’” – Joel (13:48)
• “You can hear it in your voice, John—it sounds like you’re not excited about it…there’s a certain amount of salesmanship when renting out property.” – Matt (18:26)
• “A locked-in mortgage rate below 3% is almost…an asset in today’s environment.” – Joel (17:09)
• “We love using credit cards…but when you don’t keep up, it can come back and bite you in the butt.” – Matt (39:03)
• “Let him click the mouse…that buy-in is important.” – Matt (52:38)
• “Crowdfunded real estate platforms like Arrived are not scams, but for most investors, they aren’t compelling compared to index funds due to fees, risks, and illiquidity.” – Joel (48:59)

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Timestamps for Main Segments

• EV Road Trip Lessons & Rental Discounts: 02:59–08:33
• Should I Keep My Condo? 09:34–21:55
• ABLE Accounts & Special Needs Planning: 24:57–32:24
• Paying Down Debt with Low-Interest Line of Credit: 33:07–39:03
• Real Estate Crowdfunding Sites (“Arrived”): 45:10–50:03
• Opening a Roth IRA for Kids: 51:18–55:30

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The How to Money Spirit

The episode is packed with practical, approachable money wisdom delivered with warmth, humility, and humor. The hosts consistently emphasize emotional factors (“you sound like you’re not into it”), focus on basics over gimmicks, and call out the behavioral aspects of money—making it a great listen (or read, here!) for both beginners and seasoned do-it-yourselfers.

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Best Friends Out.

Transcript

[Podcast Host]

This is an iHeart podcast.

[Matt]

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[Joel]

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[Matt]

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[Joel]

Welcome to how to Money. I'm Joel.

[Matt]

I am Matt.

[Joel]

Today we're going to answer some of your listener.

[Matt]

You know what, buddy, it's Monday. We've got listener questions to get to. For instance, a listener is wondering if his condo is a good investment or maybe if there's better options out there for him. We're going to talk about able accounts. This isn't typically an account that we discuss, but I think folks will find it interesting.

[Joel]

It's a more niche account, but it can be a big help to families who need it.

[Listener John]

Indeed.

[Matt]

Yeah. And we're going to talk about a line of credits that a listener has available to them, but it happens to be with the best rate that I've ever heard of. Maybe it's too good to be true. We'll talk about that, plus other topics that we'll get to during our Ask how to Money episode today. Buddy.

[Joel]

Sounds good.

[Matt]

But hey, I recently shared how on an upcoming trip that Kate and I, I explained how, hey, I opted for the Tesla, the EV with a car rental company because it was the cheapest choice. It was so cheap, it was 90 something like 96 bucks. And the next alternative was 300.

[Joel]

It's cheaper than like the Toyota Corolla.

[Matt]

I could not believe how affordable it was. And I did all the math, crunched the numbers, you know, because I was just like, no, no, the mileage should be good and all that. All right, all that to be said. I stood up there at the counter and the guy said, oh, I see here you got the Tesla long range. Let me get you a gas powered vehicle. I was like, well, is it going to be more like, how come? Like, you know, I wanted to go with this because of the mileage. And he's like, wait, where are you headed? And we were headed to Sedona from Phoenix and I was like, I crunched the numbers, it's plenty far enough. And he said, well, you've accounted for the miles, but you haven't accounted for the change in elevation. You basically go up. And I didn't realize this at the time, but you go up like a mountain range. And he said if you're driving around town or if you're going somewhere else where it was the same elevation where we currently are, he's like, no problem. Even with the AC blasting, which you're likely going to want to do because it's 100 degrees out there. He said you likely would be fine. But these are the elevation change. He said it destroys. It just takes down EV batteries so quickly. And he just pointed out specifically the range anxiety. And he said, you know what if that was your Tesla and you knew what change in elevation like that might do for you. He just pointed out that it's just much more nuanced than I was giving it credit for. Because I crunched the numbers. I was like, this is. You know, I put my glasses on, pulled out the calculator.

[Joel]

Oh, it was 180 miles to get there. This thing's got 220. I'm good.

[Matt]

Piece of cake. Is. Yeah, I think even more than that. But I don't know, it was a learning experience where he pointed out that there are just more variables that go into how long the battery life lasts on an ev. I guess not too unlike our phones. You kind of get used to our specific device, how long a 23% charge is gonna last us. When you're getting ready to board the airplane, you know the steps you need to take.

[Joel]

Yeah. Like, don't fire up a video right now.

[Matt]

Cause, you know, okay, go ahead and quit all the different apps, switch it to power saving mode, airplane mode, turn off all the other things. I just want to be able to read my book on my phone, that sort of thing. So all that being said, I was like, all right, well, how much is it gonna cost me? Because the reason I chose this was because it's so much more affordable.

[Joel]

Sure.

[Matt]

And the next cheap. Literally the next cheapest alternative was around 300 bucks. And it's like, well, since you're here in person, I can get you a discount. It is gonna cost more, but it only costed me $60 more.

[Joel]

Okay.

[Matt]

To get a traditionally powered vehicle. And on top of that, he's just like, well, I can go ahead upgrade you as well. We'll get you the. It was a Kia Telluride, which is nice. It was like a. When I told I was joking with Kate after the fact, I thought, you know what? I probably would have rather have gotten the smaller sedan for the gas mileage. It's not like we needed all the space.

[Joel]

I figured, folks get you the Hummer, sir.

[Matt]

No, no, no, no. Just give me the Honda Accord or something.

[Joel]

What does that get?

[Matt]

Miles per gallon. That's too bad. Anyway, I wanted to point that out, that the ability to get that discount in person, being willing to Ask and have a conversation, looking someone in the eye, sharing what you're excited to do. I think all that goes into possibly receiving a discount. Don't expect the discount, but I think it makes you more likely to be a receiver of a discount.

[Joel]

It's also helpful planning ahead. When you are renting an ev, just know there are more variables than you might think going into. And it's funny, I was just riding in my friend's Tesla on a six hour road trip in California and I will say the thing I was really impressed with about Tesla is when it comes to plotting out charging, if you're going a really long distance, the auto, auto route, they do an amazing job. Hey, here are the most ideal places for you to charge. Here's how long you need to stay there to get up to a certain point and then, hey, stop at the next place, two hours away and then charge for another 12 minutes and then you're good to get home. So they do a really good job helping you figure that out. They make it less. I think it reduces the range anxiety, but still they take care of it for you.

[Matt]

Yeah.

[Joel]

So how many times that you're not gonna save much money if you're charging at a supercharging station. It costs almost as much as gas does.

[Matt]

Unless it's a vehicle that you own, which this friend in particular, this is his Tesla. So I'm curious, how many times did y' all have to stop?

[Joel]

Two times?

[Matt]

Twice on like six hours, 10, 15 minutes.

[Joel]

It was about, it was about 15 minutes one and 25 the other.

[Matt]

So, okay, so, you know, not an insignificant amount of time. You know, I will say, like, imagine getting stuck in traffic for 15 minutes or 25 minutes. That's, that's like enough to like quote unquote, ruin the trip if you're like, oh, yeah, I got stuck, you know. Yeah, I had a drive yesterday, got stuck for 45 minutes total in traffic.

[Joel]

You gotta factor in the extra time, but usually this is good. A good excuse for a pee break.

[Matt]

Good enough. Fair enough. Yeah, get out, stretch the legs a little bit.

[Joel]

Yeah, I dig it. All right, let's mention the beer we're having, Matt. This is a Solstice sour by Almanac Brewing. And we'll give our thoughts at the end of the episode. This one looks really tasty.

[Matt]

Did you ever listen to the Almond Brothers? The font that they chose for Almanac reminds me kind of like that old country.

[Joel]

I think I'm too young to have. Listen, the Almond Brothers.

[Matt]

Same.

[Joel]

I mean, I know a couple of.

[Matt]

Songs, but yeah, I just for some reason think that that's what that looks like. Okay.

[Joel]

Yeah, I can see that. I'm not too familiar, but enough of that. Yeah. Okay, let's get on to listener questions. If you have a question we'd love to hear from you, go to howtomoney.com ask if you got a money question. It's tangential to money, even just relationship advice in general. Matt's really digging into that. He'll philosophy whatever you want to ask. Send it over. We'll make Matt take it. Just go to howtomoney.com ask simple directions or record that voice memo on your phone. Send it over.

[Matt]

Joel will also be sure to include my phone number out to directly receive all the all the hate for sure that I'm sure to receive where I dispense any relational advice.

[Joel]

All right, first question, Matt, let's get to one from a listener who's like struggling about whether or not to keep or sell a real estate asset he owns.

[Listener John]

Hello, my name is John and I find the information on this program very helpful, especially for beginners such as myself going in the world of financing and planning. I have heard the topic of condos before on this program and to me they generally don't sound like a great investment. I have had my condo for about four years now, and from my experience, it has not appreciated much in value and a lot of my salary goes towards paying the property taxes that are due at the end of the year. And I feel like that money would be better spent on something else since I barely get anything in return after paying the property taxes. Anyway. I recently rented out my condo to tenants and they have been there for several months and I'm wondering if things would get better after I pay off the rest of my immediate expenses and I could finally put the rent and receive to an account that will pay the mortgage, property tax, and the HOA. However, after doing calculations, I only still get about 100 to $200 a month. After all, that is deducted from the rent, which I don't see as too great. The property is located near the beach in Los Angeles and I got it during the COVID times when the interest rate was very low, around 2.8%. Would this make my condo worth keeping? I would really appreciate some advice and thank you so much for everything.

[Matt]

All right, John, I am glad to hear that you found the show helpful and your question, condos specifically, you're talking about whether or not your condo, whether or not it's a good investment. But Specifically, what I want to ask is, should it be a good investment? Because when you buy a condo or when you buy a single family home, the main goal is going to be.

[Joel]

To put a roof over your head.

[Matt]

You're looking for a place to live. So in this case you are, or I would say that you were getting something and otherwise you'd have to fork over the money in rent. That's. And that right there, that's the rent versus buy debate. And that answer depends on personal goals. You know, what's happening in the market. But right now, renting, it certainly beats buying almost everywhere from a pure price per month standpoint. But again, so much is going to depend on your personal, your lifestyle goals, not just what is more affordable right now, not just what the dollars and cents shows.

[Joel]

And sometimes, right buying, if you have an extended timeline, you're like, oh, my monthly payment is going to be a little bit higher, but if it meets your goals, and also you're talking about locking in that cost over a long period of time. Rents have not been going up lately, but typically rents go up at a fairly regular pace year after year. And the truth is, Matt, I think we as a society, we've collectively viewed home or cond. Ownership as this way to build wealth. When you think about the average American, they probably many of them have more wealth in their home, more equity in their home than they have wealth in the stock market. So by de facto, it is their number one savings vehicle. And so because of that, they see it as like, oh, this is my, this is my little piggy bank over here. This is where I'm stashing my cash. And we have seen, right. Rapid appreciation in recent years, leading many to expect more of the same. Like I think people are like, oh great, I've seen what happened in home prices over the past few years. My real estate agent is saying, get in before the get in gets impossible. And then those people are dismayed if the market stutters after they make their own purchase. But that is happening currently for some, which is something that you and I have warned about, that, hey, the market can't continue to go up at this clip forever. Well, the purpose, I think for some it isn't to live in a place they desire, but to see their equity grow. But the housing market is this complex organism. Buying with dreams of rapid equity accumulation I think just is a bad idea. Don't go into to a home or condo purchase with that in mind. Think of it like a cherry on top. Kind of like you said, Matt, you Don't want to go into it with that being the sole or major goal. Make your decision on other variables. Have a long enough ownership timeline in mind. Like plan to own that place for a while. And then if your home price appreciates faster than average, I would just be like, oh, thank my lucky stars.

[Matt]

Yeah, yeah. Because they tend to appreciate at a slower rate than single family homes as well. So you gotta be more, you gotta be more patient. And I think you're setting yourself up for disappointment, even for disaster if you're expecting anything more than that. But so much does depend on your location. And I'm kind of actually surprised to hear, John, that you mentioned that you don't think your condo has gone up in value much over the past four years. Because we have seen outsized price growth across most of the country.

[Joel]

If you said you bought like a year ago, I'd be like, yeah, maybe.

[Matt]

Not, I understand it a year ago, but four years ago I feel like you should have caught that massive uptick. So I would revisit and just see how accurate those numbers are and just what it's based on. Based on like what you paid, what other units in your complex are going for what they've recently sold for. But you, you bring up something else as well, which is essentially plateauing or receding rents. And I think that can make it feel like your condo isn't a great investment. And for many landlords it has impinged on their ability to profit from the rental. And in your case, the amount that you're making over and above your mortgage, it's not, surely doesn't sound very life changing. I think he said 100 bucks more is kind of what he's at. That's what the current rents are pulling in. That's still positive. I want to say that I want to provide you some encouragement. Yes. Yeah. You are in the black. And I think with that in mind, holding onto the condo over the long term, it could still potentially be a big winner for you if you are willing to stick with it. Yeah.

[Joel]

And I think so much comes down to location. Right. Matt, when you talk about some of those west coast cities in particular, the numbers, oftentimes landlords are buying for appreciation purposes only. They're losing money every single month. So the fact that John is making money on the west coast with an L, a condo, think about a place like San Francisco. You can't really hope to buy a place in San Francisco or New York City.

[Matt]

And like, yeah, he said he's close to the beach. Right. Like that sounds pretty dang desirable, honestly. Maybe that's a big part of it because he's specifically calling out the additional taxes and the HOA dues out May. This is a building that has like turned things around as far as special assessments and they're realizing that, oh man, if we want to make sure this building doesn't like crumble into the ocean or something like that, we're going to need to start setting aside a lot more money to ensure that we're taking care of this building. That maybe that's what's going on here.

[Joel]

Yeah. And I would say in a city like Mobile, Alabama, you're investing for cash flow month after month. In a city like Los Angeles or New York City or San Francisco, whatever, big cities like that, Seattle, these are.

[Matt]

Attractive places to live.

[Joel]

You're probably talking about renting, being a landlord more for appreciation over time of that unit. So that's something you need to factor in as well. Yeah. You might not be making much money every month, but hey, you're doing better than a lot of landlords in your similar location would be doing. And you asked about how the interest rate plays into your decision to keep or sell. I think it matters. I think it's, it's a check mark in the pro category because a locked in mortgage rate below 3% is almost. And I say almost because I can't quite bring myself, Matt, to call that an asset. Because it's not, because it is a liability, in fact, still a debt.

[Matt]

It's still a debt from an accounting standpoint.

[Joel]

But in today's economic environment it sort of feels like that because it is.

[Matt]

The floor has been raised and it feels like to anything in like the twos and threes percent almost feels like, wait, wait a minute, I'm making money.

[Joel]

Right. Which you kind of are if you've got money in savings and you're not paying down that mortgage more quickly like you're coming out ahead in that spread. Still, I think again, there are a lot more things to take into consideration like profitability. What else could you accomplish with the freed up equity, the financial state of your homeowners association, Matt, which you kind of alluded to. Well, and then whether or not you like being a landlord, I think that's a really, really important thing to think about. And a lot of people, I think.

[Matt]

That might be the most important thing. Yeah.

[Joel]

Because we talk about it as a part time job, not just an investment, unlike investing in the stock market. Just like tossing money in dollar cost averaging every couple of weeks and John, you made it sound like the property tax is this giant thorn in your side, which makes you want to say, well, hey, you might want to challenge it if you think it's, if it's too high, if it's unfair. Sure. But I'm not sure. It sounds like maybe the overall experience of being a landlord isn't quite your jam either. And if that's the case and you're like, should I keep doing this just because maybe the numbers might work out a little bit better? I would say probably not. Like, if that's kind of where your head, where your heart's at, you're probably going to be frustrated putting in the effort. And there might be an easier way to build wealth than sticking with this condo.

[Matt]

Totally. Yep. It sounds like he's not into it. Not just from an emotional standpoint, but like literally in his voice. It just sounds like he's not excited about it. And like, there's a certain amount of salesmanship that goes like, imagine for, you know, you're out there and you're thinking about going to rent from. You show up when they say to show up and you're getting, getting a tour of the place and they're kind of like, yeah, this is this and this is going on and they don't seem excited about the place. Yeah, that would be a very different experience than like where I had to show up. And he's like, well, yeah, here's, here's the view. It's beautiful. You can actually see the beach, sunsets. Amazing.

[Joel]

The coffee shop one block over is the best in town.

[Matt]

Yeah. Here are the amenities that the actual building offers. Like, you kind of go, you go through all the different things that are. You're not trying to oversell it, but you are trying to tout some of the different benefits that the place has. Literally, I'm in the middle of renovating a bathroom in one of our rental properties. Dude, you better believe when it comes time to show that place, I'm gonna be like, and now check out this brand new bed. It's brand new. It's got a new tub in here. Hasn't had a new tub in here for like 60 years. This is a hundred year old home. Fresh tile on the walls, new tile on the ground, new toilet, brand new plumbing fixtures. Yeah, it's chrome, kind of classic. You know, have that.

[Joel]

Is that new Japanese toilet mat with a sweet bidet.

[Matt]

Not going that fancy, but maybe it's easier to clean. I don't know. Not going to go down that path.

[Joel]

Easier to Clean yourself.

[Matt]

That's what I hear. But again, not to try to sell a false bill of goods, but to just point out that, like, man, this is something that I am proud of, something that you should be excited about. And I think that excitement and sort of the. I even hate saying this, but you want to have the right vibes, you know, because, like, there is a certain part of it that folks are going to pick up on whether or not you stand behind this property. And you got to want to do it. You got to be excited about the actual property. That's. I think that could be a bigger part of renting out a place and showing a place then many folks would give it credit.

[Joel]

Yeah. Last but not least, just so we're talking about kind of more of the vibish side of things. It's just important to note the potential tax liability side of things to the 2 and 5 rule. Right. Where if you lived in the condo for two of the last five years, you're not going to owe tax on the gain that you've seen. Again, you made the gain sound minimal. I'd go back and take a look at the numbers. Hey, what did I pay for it? What is this likely worth now? But still, you know, paying capital gains, let's say, on a tax, on a. On a gain of 30 grand. That's still thousands of dollars in tax you can avoid.

[Matt]

Yeah, man.

[Joel]

By selling before you reach that deadline, which is a big deal. It's not for you.

[Matt]

It's a big deal. Especially if you're only pulling in 100 more a month in profit.

[Joel]

And the last thing, have a plan for what you're going to do with the money after you cash out at the closing table, because that could be a significant sum of money in your lap in one fell swoop. And you might be like, oh, yeah, I guess first class plane tickets to New Zealand are looking real good right now, but they're calling your name, you're selling an investment. And I would assume that you probably want to invest the majority of those dollars in a different way, probably in the easy route in an S&P 500 fund or total stock market fund or something like that. So just make sure you're doing the right thing really quickly with that money and not letting it linger or tempt.

[Matt]

You where you're tempted into spending that money. That's right. So, John, we hope that gets you pointed in the right direction. Joel, we've got more to get to. We're going to hear from a listener who sounds like he's got a pretty great plan to eliminate some debt in his life. We'll hear from him and others right after this.

[Earn In Representative]

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[Matt]

Joel so we've talked pretty extensively about how we took some time off this summer, took a small break to enjoy time with family and get away. But it wasn't a knee jerk decision. We planned ahead, we prepared for it in order for things to continue running smoothly. Things can change fast, especially during these busy summer months. But with the right plan, you can ensure that you and the people you care for most are prepared for anything. And that's where trust and will comes in. They make estate planning simple and secure so you can confidently create a will, designate a power of attorney, secure your digital assets and more. Visit trustandwill.com how2money to get 20% off their simple, secure and expert backed estate planning services.

[Joel]

Yeah Matt, we actually sadly just experienced a death of a family member. It was shocking for all of us. And also just a reminder of how important estate planning is. Trust and will is easy to use and simple to navigate. Plus all your information and documents are securely stored with bank level encryption. Each will or trust is state specific, legally valid and customized to your needs.

[Matt]

That's right, we can't control everything, but trust and will can help you to take control of protecting your family's future. Visit trustandwill.com howtomoney and get 20% off. That's 20% [e-mail] howtomoney Every business has an ambition.

[PayPal Open Representative]

PayPal Open is the platform designed to help you grow into yours with business loans so you can expand and access to hundreds of millions of PayPal customers worldwide. And your customers can pay all the ways they want with PayPal, Venmo, pay later and all major cards so you can focus on scaling up when it's time to get growing. There's one platform for all business PayPal open grow today at paypalopen.com loans subject to approval in available locations.

[Joel]

All right, Matt, we're back. More listener questions to hit up. Let's get to a question now about an account you and I have touched on before, but rarely. It's a good one.

[Podcast Host]

Hi Matt and Joel, this is Jennifer from South Carolina. Love the show. And I had a quick question for you. My husband and I have four boys that range from ages 14 to 3. Our 10 year old has severe special needs so we know that we will be caring for him the remainder of our life. My questions relate to what we should be doing now to help save for that. We have retirement plans. My husband has a 401k through his employer. We fully fund a Roth and we have an HSA plan. We have set up 529 plans for our kids when they were born and we contribute a small amount each month. We were considering pausing the contribution to our 10 year old and rolling his into an able plan through the state, but wasn't sure what your thoughts on that were. Also thought maybe I should just contribute to the 529 and roll it into a Roth when I'm allowed to do that. We also have a special needs trust set up as part of our estate plan in case something were to happen to my husband and I. Anything else that you know of or can think of that would help us would be greatly appreciated. Thanks so much, Gus.

[Matt]

All right, Jennifer, first off, amazing job doing everything that you can now in order to ensure that you are setting your son and honestly others who might be involved with helping to take care of him for less stress off in the future.

[Joel]

Right.

[Matt]

So you're kind of, you're front loading that sacrifice now in order to not have to worry about this as much later down the road. And specifically I want to talk about the special needs trust that you mentioned. For folks out there, this is really important because if you have a loved one with a disability, you, chances are they rely on different government benefits like Medicaid or Social Security income. Well, those programs are super strict about how much money or assets someone can have. And so if you were to just. You mentioned you set this up in case something happens to you and your husband, let's say that terrible thing happens. And were your son to just inherit that cash, right? Or if, let's just say you were to hand them that cash directly, you might accidentally knock him off that very support that he is depending on all.

[Joel]

Of a sudden not qualified anymore for some of those benefits that he's used to. Exactly.

[Matt]

Yeah. So a special needs trust, it fixes that. It lets you set money aside for their future without messing up their benefits. And the trust can cover things like their education, different therapies, but also even fun stuff like travel or hobbies as well. It doesn't have to be purely disability related. And of course, I'm certainly glad to hear that you are taking care of all of your future investing needs already as well. The 401k you got, the Roths. You're even taking advantage of the triple slash quadruple tax advantage, hsa. It sounds like y' all are knocking it out of the park on a lot of different accounts here.

[Joel]

Not easy to do, Matt. It's not easy to do that. Like check the D all the above box. But that's plus with four boys, right?

[Matt]

We were just joking.

[Joel]

Right? Four. Not just. It's not like you're just saving for the one with special needs. Like you've got kids, you get your own retirement to think about. Like that's, that's just.

[Matt]

Boys are hard work and boys are a lot. We were just joking about how a friend of ours has three boys. I'm like, could you imagine him with one more? It's. I feel like sometimes it can be.

[Joel]

Crazy enough he'd have even more bruises on his shins, you know?

[Matt]

Exactly.

[Joel]

Jennifer, I love that you're considering an able plan too. I mean, these were established almost exactly a decade ago and they're special savings accounts specifically intended for disabled people. And we'll talk about the benefits for your son and. But able accounts are this cousin of the 529 plan. So you'll see those kind of interchangeably. Sometimes a 529 Able is what you might hear called which means you're going to get a state tax deduction on contributions you make up to a certain threshold in some states. And so similar to a Special needs Trust. An Able account for disabled folks and their families allows them to save and invest without jeopardizing those state and federal. Federal benefits, many of which get reduced if your child has a certain amount of income in his or her name. So, yeah, kind of like you're referring to Matt, like there's this possibility that you exceed some of those and a lot of those limits are super small. So it's not like, oh, my kids. If your kid starts making 50 grand a year, they in all likelihood don't qualify for many of those benefits. Or if they're given a certain sum of money that's meaningful, same thing. And all you need to qualify, by the way, for an Able account to be able to save and invest for your son's future is a doctor's letter stating that your child became disabled before the age of 26. If you meet that requirement, if your doctor's willing to write that letter, then you're good to go. Like, Able Account is open and available to you.

[Matt]

That's right. Yeah. And we are not attorneys. Should we start like every podcast with that, Joel, that we. We are not paid tax professionals and do not listen to our tax and investing advice, but with an Able account, you do. Those funds are typically are earmarked specifically for expenses that relate to his disability, so keep that in mind. But similar to a 529 plan, you can invest those dollars for your child as well. So you're not just saving money there within that Able account, you're investing those funds just like we do for our.

[Joel]

Kids when it comes to future education costs. Exactly.

[Matt]

Yeah, man. I've got that fully invested in stocks. The most aggressive of my investment options, because I got years and years down the road. The beautiful part is that those funds grow tax free. So since your son is 10 years old, you might not be looking to spend Able dollars anytime soon. But when you get closer to that point that you do want him to have spending access to his account, consider pivoting towards some different conservative options there for him. Again, sounds like you're a ways off, but keep that in mind. But these accounts, they do come with a debit card that's attached to him. And so when he's ready to start spending, when he has a little more autonomy, if that's a position you find yourself in, it'll make things a little bit easier to access as well.

[Joel]

And the cool thing is, other people can make gifts to your child's Able account too.

[Matt]

So again, not unlike a 529, right?

[Joel]

You might say, oh, this is great. Actually, you might find that grandparents or close family members are also willing and interested in helping to stash money into this Able account for your son as well. If you've got generous family members, make sure you let them know. And then also just there's a lot of fine print about this stuff. So make sure you dig in and know the details like Social Security benefits, SSI benefits can be suspended after hitting the $100,000 threshold in your Able account. So a lot of people suspend contributions and they start spending down some of that balance once they reach that point to not put those benefits in jeopardy. By the way, you can do an Able account and a 529 plan, which you could later roll some of those $529 into a Roth IRA. If you want to do even more to invest for his future, that would be impressive. Again, you're doing a whole lot for your own future. Got four boys saving in the Sable account. But if that's something, if you're like, we want to do even more like you, that's on the table as well.

[Matt]

Yeah. Or even, or even switching things up. So if you, and it partly depends on your focus as well. I think if it was me, I would be focusing on the Able account if you are looking to supplement sort of the day to day expenses sort of thing. But if higher education is in his future, okay, well that's what the 529 is for. And so the ability to use that account specifically for what it's designed for.

[Joel]

Or even specialty school that's not college. Right. Beforehand, like K through 12 education, that private education.

[Matt]

Yeah, exactly. So keep that in mind too because I mean, it's not an unlimited amount of money that you can roll over into the Roth ira. So I think I would be focusing on the able, given these specific, specific circumstances, knowing that, okay, there's a little bit of additional room, some more margin over there within the 529, knowing that if he doesn't go off to higher ed, you got 35,000 over there that you can transfer over to a Roth, which of course you can use for any purpose. But Jennifer, we hope that gives you some, some food for thought. Joel, let's hear from our next listener. Let's hear from Mike. And it sounds like he, he's got a pretty dang good plan to eliminate some debt in his life.

[Listener Mike]

Hello. I have a question for you on credit card debt. I have about $50,000 in credit card debt at a pretty high rate, 22% I can have access to a line of credit that's 1% for six months, that I could pay off the credit card debt. But I can't decide which is better. Just to keep it on the credit cards and pay it off in six months or would I be paying less interest on the line of credit that is 1% for six months.

[Joel]

All right, Matt, I just got to.

[Matt]

Know because I feel like this could be a yes or no answer.

[Joel]

Sure it could be.

[Matt]

There's plenty more to talk about here.

[Joel]

This makes me wonder how Mike is getting a 1% line of credit. That sounds too good to be true.

[Matt]

It makes me think that he's got some organs that he's signed away as collateral. Perhaps come after his potentially.

[Joel]

Yeah. Is this like mafia related loan that you're taking out?

[Matt]

Like take out his knees, man.

[Joel]

Even an awesome local credit union probably doesn't have rates quite that good. So I am curious because Mike, if you really do have access to 1% line of credit debt debt at that.

[Matt]

Rate, fill me in, I want to know.

[Joel]

Yeah, I'm down to take some of.

[Matt]

That out as well. Yeah, this is speculation, but I wonder if it's like a family member, you know, like somebody who's just like, hey, I see what you're doing. Let's maybe there's some of that going on. Because I mean like you said, I can't remember the last time. I mean I don't think even HELOC rates, right, Like I'm thinking about that low. No, like I'm thinking about the Great Recession and that's when rates were basically low twos at all time lows at least in my lifetime.

[Joel]

Yeah, well, speaking of that, I mean we recently talked about the downsides of turning credit card debt into a heloc. And so I think there were some similarities maybe here because you're just, you're taking non secured debt, you're turning it into secured debt and then not paying your home equity line of credit comes with bigger consequences than not paying your credit card bill. So it's not just the interest rate is the terms and what you're putting up as collateral, like whether it's vital organs. Right. Like you just have to be careful about what you're signing up for because yeah, there are typically trade offs when you're exchanging one debt for another.

[Matt]

You need to know what the trade offs are. You need to know what the possible downsides might be were you to not pay off that full amount in six months time. You know, like yeah, it starts out at one. But then does it shoot to 100?

[Joel]

Yes, this is an interest rate for the first three months, and then after that it shoots up dramatically. It's like a payday loan of sorts. Who knows?

[Matt]

Well, yeah, it did sound like he's kind of got like that introductory rate, perhaps four, six months, but. Well, let's address that because I think it's amazing that he's going to be able to pay off this much debt in that short of a period of time. Like, for most folks. He said $50,000, man. Like, that much debt would take years to eradicate. I think for most folks. And that's often because it took them years to actually accumulate that debt as well. It does make me think that Mike has a reasonably high income, and maybe he's just found a way to slash expenses pretty significantly. Sometimes you are just. You're turning a blind eye to kind of what the left hand is doing over here. You're just focused on the right hand. Let's just focus on all the spending.

[Joel]

But they kind of wake up and.

[Matt]

You get that like, wait a minute, this is. This is crazy. Yeah.

[Joel]

Fire lid under your butt and you're like, let's go.

[Matt]

Exactly. Yeah. So hopefully Mike is able to maintain that frame of mind, that state of mind, even after he eradicates that. That credit card debt where he's able to save and invest. And that's just gonna seriously allow him to ramp up his wealth down the road. You know, a couple years with that sort of singular focus where, okay, I mean, 50k, six months, you're looking at 100, like, close to six digits that he might be able to just dispense, like, do what he chooses to a.

[Joel]

Swing in his net worth.

[Matt]

Oh, my goodness. That is a fantastic position to find yourself in, Mike, if you're able to kind of hold the course even after you eliminate that debt.

[Joel]

I think to that specific question, like, would I rather pay 1% interest on a balance that large than 22%? Yeah, I think I would. Right. I mean, and I don't think we're alone in that. I mean, reducing your interest rate can be a really beneficial thing when it comes to speedy debt payoff. But again, the trade offs, you got to be aware of the terms. If you're attentive, it can work in your favor. Just like Matt, we talked about balance transfer credit cards. Those can be a really helpful thing for people who are incredibly motivated to pay off their debt. And it could take them from a 22% interest rate. Hey, yeah. They pay the 3% transfer fee or something like that. But then there you have potentially 18 months at 0% interest to fully eradicate that debt. And it's going to be really helpful. It's going to accelerate the process. But you just again, have to be aware of your own human fallibility because there's a chance you keep that other credit card around, start spending on it again. Now you've got more credit card debt than you started with, and then that lovely 0% interest rate runs out and you're up the creek. Right. So be careful. And, and for instance, with Mike's question here, we're talking over the course of six months, he'd pay more than $5,000 extra in interest alone if he stuck with the 22% loan versus the 1% loan.

[Matt]

If you don't want that 5K, Mike, just send it over to the How To Money headquarters.

[Joel]

That's just a ton of money, obviously, that he could keep in his pocket instead. The downside is, hey, you don't change your ways. Similar to the balance transfer thing I just mentioned. You don't pay either of these loans off with vigor. They both begin to grow again. And this is just the situation so many people find themselves in. They're trying to be crafty and shift deck chairs around on the Titanic, but the whole ship is sinking. And so you've got to really fix the leak before you even kind of concentrate, I guess, on the better debt vehicle for you. Because if you don't fix the, the problem that led to the debt in the first place, then you're just. You're following a misplaced priority.

[Matt]

Totally agree. Yep. I think this is where it's going to be important for Mike to do some soul searching and to figure out what behavioral tendencies that he had that got him to this place in the first place. This is, I mean, this is a part of just, you know, let's take a second here to talk about credit cards, because we love using credit cards. Like, there are awesome benefits that you receive by keeping up with that. But when you don't keep up with it and when you are overspending, it can come back and bite you, bite you in the butt. It makes me even want to consider, like, those behavioral tendencies are what trip us up so oftentimes. And a lot of times you hear it talked about in regards to investing, people getting in and out of the market, they get kind of freaked out by the gyrations, tariffs, whether or not they're legal or not. Well, you know, what are the supreme is going to do. I don't know. Me, personally, I feel like I've gotten the behavioral elements from an investing standpoint, kind of licked like, over. Over decades now, multiple decades of investing in the market. I feel like I've proven to myself that that doesn't sp at all. If anything, if the market dips a little bit, I'm like, trying to find ways to maybe throw a little more money in the market while it's on sale.

[Joel]

Selling your kids used toys and stuff.

[Matt]

Let's do it. Let's clean house, little garage sale, little yard sale. Take some extra money. Let's shove it in the market. But from a spending standpoint, this is something I keep thinking about more and more. How is the fact that I'm spending on a credit card, how is that allowing me to maybe overspend in a way that were I parting with actual cash, that I would be second guessing? I'm like, how much less would I spend, for instance, if Kate and I were to go out to eat? If I'm pulling up my wallet and I'm parting with the actual actual bills, when I go to the grocery store, I'm gonna have to fork over 20s and hundreds. Like, that feels different to you, rather than just getting the phone. And it's so satisfying just to do the tap to pay because it's got a nice little chime. It beeps at you like, hey, way to go. You did it. Sometimes it's tricky to tap your phone.

[Joel]

But you're a pro.

[Matt]

I mean, you know how to do it. Rewards you to spend. You know, using the credit card, though the actual devices themselves encourage spending. And so I'm just pointing out that, like, I'm even thinking through maybe there are ways that I could kind of tighten up our budget, kind of rein in our spending a little bit, because that's one where I'm not totally sure how much leash we've given ourselves to spend more than we otherwise would.

[Joel]

Yeah. I mean, that reminds me of our conversation with Professor Jay Z talking about the power of cash. And you and I, we're not immune to messing up or making or, you know, just not paying attention in the ways that we should or spending in a way that does that doesn't cause us to be quite as thoughtful. And I think you're right. Like, that's one of the things he was trying to persuade us in that conversation was the more we use cash, the more thoughtful we tend to be about our money. And I do think, I think there's a lot of truth to that. I think we just spend on Autopilot in so many ways. Whether it's Tap to pay, whether it's Autosave on Amazon or whatever site you're using to buy stuff, whether it's just having those marketing emails come straight in and we're like, oh yeah, sale, let's go for it. Click straight through to your favorite retailer. All of those things are behavioral elements that we have to be aware of so that we can change to really prevent credit card debt from rearing his ugly head in our lives.

[Matt]

Yeah, man, those behavioral tendencies, that's what trips us up.

[Joel]

Matt, We've got more questions to get to, including one about investing in real estate on websites on the Internet and then one about investing for a kiddo. We'll get to both those right after this.

[Matt]

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PayPal Open is the platform designed to help you grow into yours with business loans so you can expand and access to hundreds of millions of PayPal customers worldwide. And your customers can pay all the ways they want with PayPal, Venmo, pay later, and all major cards so you can focus on scaling up when it's time to get growing. There's one platform for all business PayPal open grow today at paypalopen.com loans subject to approval in available locations hey, it's.

[Joel]

Joel and Matt from how to Money. Matt, it's almost spooky season and do you remember The Halloween we spent together in.

[Matt]

How can I forget Joel? Nothing screams spooky season like driving through the Irish countryside in the dark while it's raining, visiting abandoned castles.

[Joel]

The best part is that we got to experience a couple of amazing Airbnbs along the way. Like one in a tiny village right off the coast. Something about walking right out your door into the fresh Irish countryside that just makes a trip spectacular.

[Matt]

It was beautiful. And if I remember correctly, that was the house that also had amazing folk art, but it was Irish folk art, so I feel like it was hitting you on all cylinders. All the fields, the one we shared with the host and her kids to save some money, I actually remember that one. I still remember sitting around her wood burning stove while she shared some of her favorite local spots for us to check out the next day. That trip was unforgettable and it was super affordable, which, as you know, we love.

[Joel]

If you're thinking of traveling this spooky season, you can hire a high quality local co host to handle everything from creating your listing to designing and styling things while you're away, too. Find a co [e-mail] host.

[Matt]

All right, buddy. We are back from the break. It is now time for the Facebook question of the week, which is from Nicole. This is a great one because it's short, she writes. Has anyone heard about Arrived, described as a real estate investing platform for passive investors. Joel, have you heard about Arrived? What you think about it?

[Joel]

Yes, I have deposited Departed from Arrived.

[Matt]

It's the new Scorsese film Arrived.

[Joel]

Yeah.

[Matt]

Was it Scorsese sequel?

[Joel]

The long awaited sequel to the Departed.

[Matt]

Okay. I can't remember.

[Joel]

It was. It's been a long time since I've seen it.

[Listener John]

It has.

[Matt]

Quite a while.

[Joel]

It was a good one though.

[Matt]

I wonder. My question is, why is she. Why is she talking about Arrived? Yeah, you know, like, has she seen advertisements? Maybe it's like a recency. It just highlights the fact that, like, ads work. Like, you see something and you think, oh, maybe that's something. I should be participating 100%. Or a friend of hers might be talking about it and they're like, well, if they're talking about it, maybe, maybe this is something I should do too.

[Joel]

You know, I've noticed it more and more in people who have had some amount of financial success or hard work and that's paid off, where they start to see their account balance grow and then they're like, okay, my net worth is. Has shot up pretty meaningfully, man. I feel like at this point I need to take on a more complex investing strategy. And the truth is, like, what's good for the goose is good for the gander. And for a lot of people, for most people like the. No, no. You don't really need to reinvent the wheel. You don't need to go back to the drawing board. The way you've been building wealth so far can continue to work for you in the future. You don't need to shake things up meaningfully. Arrived is one of these crowdfunded sites, Matt. These alternative investment sites are the place I see people turning and then getting burned. It's one of those real estate crowdfunding sites that have launched in the past, what, five plus years or so. And we talked on our recent Friday flight about a very similar site that's not doing so hot. Investors are not happy. Some have seen really bad returns. Others would have loved to see dismal returns because all their money got wiped out thanks to bad real estate deals that just completely flopped and rising interest rates and vacancies increasing at some of those rental properties. You and I, we've always said that these crowdfunded investing sites are not for the faint of heart. You need to know what you're getting into and that the projections that are made on a lot of these investment deals, they can be fanciful. And that might be the nicest way that I can put it, because some of them are just completely blowing smoke. And they're not really based in reality. They're based on rosy projections that are unlikely to come about. And then at the same time, the expenses are baked in. They're significant.

[Matt]

So that's guaranteed. Yeah, that is going to happen.

[Joel]

But I swear, reading through some of those projection statements, you're just like, it.

[Matt]

Almost gets you fired up.

[Joel]

You're like, oh, I'd be an idiot not to do this.

[Matt]

Maybe I should do it right.

[Joel]

And that's just a lot of people, again, have gotten burned in these things.

[Matt]

The sales pitches are great. There is a certain appeal there. I think they're often attempting to lure less sophisticated investors who might have heard that real estate investing is the way that's how you make the real money. And you got to do it. You got to juice your returns by getting into real estate. Given the recent history of the market, maybe they're thinking, okay, I know enough. I read the headlines. It sounds like the stock market's overrated, so they're going to look elsewhere if they want to achieve financial independence a bit more quickly. But you avoid the simple, steady path at your own peril. And I will say, to talk about real estate here more generally, more broadly speaking, it is possible to achieve outsized returns in real estate. But typically you do that by owning and managing your own properties, which of course comes with not only a larger time commitment, but also money. The capital that you've got to set aside to be able to purchase that property as well. There's more risk involved, you got more on the line, there's more at stake, which is oftentimes how it leads to those higher returns. When you are more directly involved, I.

[Joel]

Think it's important to say that Arrived is not a scam. And many of these crowdfunded investing websites, whether they be real estate or whether they be other kind of interesting markets, let me say these are not scammy. They are just not ideal for the average investor. When you look at the returns compared to a total stock market fund or an S&P 500 fund, and when you look at the expenses compared to those funds as well, there's just not much of a comparison. It just doesn't make much sense. It is kind of fun, I guess, maybe, to be able to say, I kind of own a part of this apartment complex outside of Nashville. Or it might be kind of fun to say I own some specialty whiskey on this site. Because not only do I. I don't just have it on my bar, I own the really rare stuff. Right. Even if you don't physically hold on to it, like you have an ownership stake in something that's. That's really rare and fancy and that can sound kind of cool. There's nothing seedy about these sites. We just don't think you're going to outperform. And it comes with liquidity constraints and a variety of fees that are just not worth enduring.

[Matt]

I thought when you said, it's not scammy, I thought you were gonna say, but it is spammy. Which, you know, there's like a lot of.

[Joel]

Yeah.

[Matt]

Stuff that's kind of packed in there that it's easy to overlook because it's packaged in a nice way. There's a lot of pork. That's like an old school government podcast. We're like shifting gears a little bit.

[Joel]

Yeah.

[Matt]

A lot of pork in that bill, isn't there, Joel?

[Joel]

Well, it's funny, when I look at. When you look at some of the graphs, sometimes the only investment that I've seen that potentially outperforms the stock market over long periods of time could be farmland. And there's even this one place where you can invest in farmland online and. But when you look at.

[Matt]

It's called Acre Trader, right?

[Joel]

Yeah. And when you look at. When you look.

[Matt]

I was even hesitant to even mention it because I don't want to send folks there. But like, it's better to. A known evil is better than an unknown evil. And I'm not saying that they're actually evil even that.

[Joel]

I remember the last time I looked at their site and I was like, wait a second. S and P's outperform that. Oh, and what does Acre Trader not? You know, again, not bad people. It's an interesting thing. I'm fascinated by the fact that it exists. I do not choose to invest my dollars there because the fees are much higher than the fees. And then like I have to pay more attention to it and my attention span is limited.

[Matt]

Yeah, but isn't it fun to say that I invest in pistachios?

[Joel]

Yeah. I own this avocado farm.

[Matt]

Pistachio farm.

[Joel]

It is kind of cool. All right, Matt, let's get to a question from listener Theresa. She says my 12 year old is about to get paid for his first job, house sitting for neighbors. So I'm going to open a Roth IRA for him with Fidelity. That's where I have accounts and I know their user interface. Other than making sure to invest the funds and keeping a log of the job, the date, the amount paid, are there other tips and tricks from folks who have done this before?

[Matt]

All right, first, when she says house sitting for a 12 year old, does that mean he's like. Is he like spending the night over there?

[Joel]

It's like blank check. Or you remember that one?

[Matt]

Wait, was blank check McGally Culkin?

[Joel]

No, some other kid.

[Matt]

Which one was that? Was that Richie Rich?

[Joel]

Oh yeah, that was Richie Rich.

[Matt]

We're totally digging back into the 90s archive. Theresa. I'll say first off, the fact that your son is starting at age 12, that he's got this job I think is incredible because on the financial side of things, man, that gives compounding so much time to work. So that's great. But you said that you are going to open up an IRA for him. I just read that that's what you wrote. Which is, I'll say mostly awesome. But let's get him involved a little bit here. That's my call here. I want you to, to. Well, you're gonna need to open a custodial account, but let him like actually input his information. Let him type in his name, let him click the mouse, Let him be a part of the actual process here.

[Joel]

Because I feel pumped.

[Matt]

Yeah, yeah, yeah. There is a certain amount of buy in that you want someone to emotionally feel, especially with something like this. And I think were you to do that, he would be more likely to follow it. He's gonna ask questions along the way. It's gonna give him that buy in. It's gonna give him a healthy dose of, of financial education along the way. You're not setting this up for him and you might be thinking, well, he's the one doing the work. But I'm here to say that even the process of him starting that account, these are all things that I think are important for him to learn as well.

[Joel]

Yeah. That participatory interaction, engagement.

[Matt]

Gosh, it's hands on learning.

[Joel]

Yeah, exactly. And we love that you're doing it with Fidelity, of course. Keep it all low cost, keep it all under one roof. That makes it easier for you. It's going to make it great for him when it comes to the details. Sounds like you got that covered. You can't contribute more than he has actually earned, by the way. So if he gets birthday money or holiday gift money or something like that, that doesn't count towards his ability, how much he can contribute to the Roth. It's all about money that he's made from jobs that he's doing, like earned income. So make sure that is documented somewhere. It sounds like you're already planning on doing. I'm not sure if you already have funds picked out, by the way, but FZ Rocks is Fidelity's proprietary zero fee fund. They have a few zero fee funds. That one's worth considering because it's their total stock market one and again, hard to beat. Low fees, no fees is pretty dang awesome too. It's even better. Yeah. So just getting started in one of those funds, and the more he piles into that fund in the coming years as he earns more money, that thing's going to be like a snowball taking off down the hill pretty soon.

[Matt]

He's starting off on such the right foot and you're talking about him not being able to invest more than what he earns. Well, well, Teresa, I would even consider like dangling a little carrot. Consider matching in order to sort of up the amount that he's able to invest. Again, you can't go above his actual earned income, but let's say he's willing to contribute 50% of what he earns. Well, you could let him know like, hey, you do 50, I'll do the other 50%. Or you can make it, you know, 75, 25, whatever. But you're teaching him about matching again, creating more buy in and matching. That's something that you are mirroring that takes place out in the real world. Obviously not to that extent necessarily, but.

[Joel]

I haven't heard of an employer yet that's willing to do that. But that sounds nice.

[Matt]

But I think the ability. I think when we pass knowledge along to our kids, so much of it is kind of mirroring and mimicking some of the situations and the experiences and the decisions that they're gonna have to make off in the future. And he's gonna want to say, no. I want every one of those dollars to go to the onewheel that I've been saving up because those things ain't cheap.

[Joel]

Or that cool new LEGO set that.

[Matt]

I've been wanting, or the new switch, you know, like, there's lots of things out there, but the ability for you to say no, look, if you invest at least this much, I'll invest the same amount to get to your total here of what it is you actually earned. It's going to take some near term sacrifice. But that's also a great lesson for him to learn at this age.

[Joel]

And if you're willing to sacrifice a little bit too, maybe he'll be willing to sacrifice. And it's that.

[Matt]

It's a virtuous spiral.

[Joel]

It's a beautiful thing of wealth, for sure. All right, Matt, let's get back to the beer that we had on this episode. This one is called Solstice Sour. Solstice Sour by Almanac Beer Company. We actually get their beers locally now. We did not. Oh, really? Used to for a while.

[Matt]

I thought maybe you picked this one up abroad.

[Joel]

No, no, this was a local find.

[Matt]

So I'll say this is a Sour aged in oak barrels with. Okay, listen to this rundown of fruit. Apricots, apriums, which I don't even know what the heck that is.

[Joel]

Sounds like an atrium, but I'm assuming.

[Matt]

That with a P. Yeah. Peaches, plums and pluots hopped with citrus spectrum. It's got all the stone fruit that you.

[Joel]

That's a lot of fruit.

[Matt]

You can imagine.

[Joel]

Yeah, but.

[Matt]

Yeah. What'd you think?

[Joel]

I thought it was incredibly tart. Like mouth puckering for sure.

[Matt]

Almost. Maybe too tart. Like. Like I feel like I have less enamel on my teeth now after drinking this than I did 45 minutes ago.

[Joel]

Make sure you go to the dentist.

[Matt]

Make sure. I need to do a little fluoride treatment at home. Yeah, you Do I gotta get like at home? Can you do an at home fluoride or no?

[Joel]

Is it fluoride?

[Matt]

No. That's what they're taking out of the water now, right?

[Joel]

Oh, you can do extra fluoride toothpaste and now with extra fluoride.

[Matt]

Yeah. Does it say that?

[Joel]

I don't know. To counteract. I don't think that taking fluoride out of the water has happened in many place though. Right. There's a whole lot of.

[Matt]

Yeah. Empty promises.

[Joel]

Yeah.

[Matt]

Okay, so coming from the top, this.

[Joel]

This beer I thought was. Yeah, mouth. Mouth. Puckeringly sour, but really good. Like all the stone fruit to the max in there, I really enjoyed. And I haven't had like a sour that was like this abrasive in a while. And I was like, man, it's been a minute. So I've had something that just punched me in the mouth. And it was. It was kind of fun.

[Matt]

I'm getting smacked around over here.

[Joel]

Yeah, I kind of like.

[Matt]

I think Kate would love this beer. She. I don't know what it is. She's taken to drinking a little bit of apple cider vinegar with the mother. What is it?

[Joel]

Bragg's?

[Matt]

It's like that naturally fermented apple cider vinegar.

[Joel]

I noticed that concoction she made.

[Matt]

Yeah, she did it at the beach.

[Joel]

Yeah.

[Matt]

It was weird, but she would take. It is weird. She takes that and then adds a little bit of fruit juice, adds some seltzer.

[Joel]

Yeah.

[Matt]

Creates like her. It's like a. I don't know, like a DIY kombucha perhaps. But I think she would be all about this. Me, I'm 50. 50 on.

[Joel]

Okay.

[Matt]

But yeah, it's still fun to enjoy. I am enjoying the barrel age nature of it, which I'm always going to be a fan of. Any beer that's. That's aged in oak.

[Joel]

I think you'd like to live in an oak barrel someday.

[Matt]

Oh my gosh. Honestly, that's like even more reason to consider getting a sauna. Yeah, like the, the big barrel kind that I know you're considering.

[Joel]

True story.

[Matt]

Oh, wait a minute.

[Joel]

Someday.

[Matt]

Oh, save this for another conversation. The neighbor, I'm pretty sure he. You just said he pulled the trigger on a sauna.

[Joel]

Oh, really? So, yeah, I'll just go to his house.

[Matt]

Yeah, come on over. Let's do it. Neighborhood dad, sauna hangs. Giant party that I don't want to.

[Joel]

Be a part of. All right, that's going to do it for this one. Remember, if you have a question, send it over our way. We'd love to hear from you. Oh, and we have a really fun interview for you on Wednesday. If you're like, I'm making six figures and it's really hard for me to get by, then you want to listen to Wednesday's episode. Code for someone who's doing it on less than 40k and has been for a long time with a bunch of children in tow.

[Matt]

Nice tease.

[Joel]

Yeah, it'll be a good one. All right, thanks so much for listening, Matt. Until next time. Best friends out.

[Matt]

Best friends out.

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