Ask HTM - Losing Weight to Gain Wealth, Free Car Leases, & Hacking Mortgages #1159

Summary

How to Money – Episode #1159

“Ask HTM – Losing Weight to Gain Wealth, Free Car Leases, & Hacking Mortgages”

Date: June 29, 2026
Hosts: Joel & Matt (iHeartPodcasts)

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Episode Overview

In this listener-driven Q&A episode, Joel and Matt tackle six core money topics shared by their audience, ranging from how to handle recent inheritances to leveraging workplace perks like employee stock purchase plans (ESPPs) and car reimbursement programs. The guys further discuss the intersection of health and finances with a real-life insurance “win,” and break down the so-called “mortgage hacks” flooding social media. Their characteristic blend of humor, practical advice, and camaraderie delivers tangible, jargon-free insights aimed at helping everyday listeners thrive financially, all while keeping things down-to-earth and relatable.

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Key Discussion Points & Insights

1. Handling an Inheritance & Financial Advisors

[09:32 – 29:00]

• Listener Concern: Brady recently inherited money, left it with the original wealth management team, feels their performance lags the market, and is wondering whether to stick with advisors, go DIY, or even use AI to manage investments.
• Hosts’ Guidance:
  • Waiting Period is Wise: Joel praises Brady for letting things settle before making big financial decisions amid grief ([16:53 – 17:28]).

    "Mixing grief and crucial investing decisions is just a bad idea... taking a beat is really smart." — Joel ([16:59])

  • Advisor Underperformance: Matt notes risk tolerance and age matter—conservative portfolios underperform in good years but may protect better during downturns ([17:28 – 18:53]).
  • Role of Advisors: Both recognize advisor value increases with financial complexity and asset drawdown ([19:23 – 21:34]), citing that most How to Money listeners benefit most from DIY investing early on.

    "As you get older and accrue a bigger nest egg, more money, more problems—or at least more complexity." — Joel ([21:11])

• Advisor Selection: They stress fee-only fiduciaries and note it's okay to “break up” with an advisor not aligned with your goals ([24:01 – 25:43]).
• On Using AI for Investment Advice:
  • Matt expresses skepticism about uploading personal data to AI tools, advocating their use as a learning and questioning aid rather than a decision-making engine ([25:43 – 28:38]).

    "Use it to engage in thoughts and conversations that could give you the type of questions to help you vet your financial advisor... but I'm definitely not gonna be uploading..." — Matt ([26:59])

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2. Is Coffee-Roasting a Money Win or Lifestyle Splurge?

[11:28 – 16:33]

• Listener Story: Brady shares how home coffee roasting started as a cost-saving move but led down a “slippery slope” of new equipment and higher upfront investment.
• Hosts’ Reflection:
  • Matt admits that for most, such hobbies are “lifestyle upgrades” and only (maybe) pay off in the long-run, emphasizing the joy of intentional spending ([13:58 – 16:33]).

    “It’s not like it would, in reality... It’s somewhat of a money win, but it’s more of a lifestyle upgrade.” — Matt ([15:10])

  • They relate similar experiences with bread-baking and beer hobbies, underscoring the value in spending on what brings happiness with eyes wide open.

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3. Maximizing Your Employee Stock Purchase Plan (ESPP)

[31:18 – 41:45]

• Listener’s Dilemma: Matt from Massachusetts asks about “quick-selling” ESPP shares for guaranteed returns vs. holding them as company stock.
• Hosts’ Consensus:
  • “Quick Flip” Strategy: Immediate sale after purchase is almost always the best move—locking in that “guaranteed ROI” and minimizing risk from overexposure to both employer and industry ([34:15 – 36:35]).

    “The only real reason to own this stock is because the optimization play you’re able to make—not to hold on for many years.” — Joel ([36:35])

  • Psychology Warning: They explain the endowment effect—how owning company stock can trick you into holding too long, but diversification is always the wiser long-term choice ([37:41 – 39:47]).
  • Tax Angle: Selling fast is a “disqualifying disposition” (ordinary income), but worth it for safety. Holding a year offers capital gains treatment but more risk ([40:02]).
  • Action Step: Set a calendar reminder to sell ESPP shares so you don’t “forget to unsubscribe”—practicality meets habit formation ([41:45]).

    “Make sure that you’re not letting that one slip through the cracks.” — Matt ([41:58])

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4. Reimbursement Programs & Leasing—When Does a Lease Make Sense?

[42:00 – 50:21]

• Listener Situation: Jesse owns a RAV4 under a FAVR (Fixed and Variable Reimbursement) program at work, but soon his car will be too old for compliance. Should he keep, lease, or buy?
• Hosts’ Analysis:
  • Keep Costs Low: Leasing is “less bad,” but still inferior to buying a newer, used car for this program. The goal is to minimize your actual car spend and keep the reimbursement gap high ([43:26 – 49:11]).

    “The goal is to minimize this business expense to keep more money in your pocket.” — Joel ([46:54])

  • Depreciation Play: Buy gently used, fuel-efficient cars to best leverage FAVR rules ([48:24]), and avoid leases due to higher long-term costs and possible mileage penalties ([49:11]).
• Practical Takeaway: Treat car reimbursements as compensation, not as an excuse to spend more on vehicles.

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5. Insurance “Money Win”: Health Improvements and Life Insurance

[52:16 – 55:23]

• Listener Story: Anonymous listener who lost weight was able to significantly reduce their term life premium by requesting a “re-rating.”
• Hosts’ Advice:
  • Always ask for a reconsideration if your health improves—insurers won’t offer this automatically ([53:49]).

    “Your insurance company isn’t kindly going to ask if there’s a reason they should reduce your premiums.” — Joel ([54:16])

  • Also compare new policies on the open market if you’re still relatively young ([53:49 – 54:16]).
• Broader Principle: Stay proactive and don’t expect insurers to lower your costs without prompting.

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6. Mortgage “Hacks”—Should You Prepay?

[55:23 – 59:00]

• Listener’s Question: Social media is full of tricks for paying off mortgages early—should extra funds be used against the principal each month, or elsewhere?
• Hosts’ Perspective:
  • Prioritize Debts: Always pay off high-interest debts and build sufficient emergency fund first ([56:13]).
  • Invest Instead: Max out retirement contributions before aggressively paying off a low-interest mortgage ([57:31 – 58:43]).

    “There’s a lot of other options out there and that would be a better place for you to put your money.” — Matt ([57:31])

  • Emotional payoff matters, but strict financial optimization typically points to taking it slower if investments outpace mortgage rates.

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Notable Quotes & Memorable Moments

• How to Think About Advisors:

  "I don't think we're anti-advisor. I think we would just say ... as your investing decisions and your life finances become more complicated, you might want the input of somebody who knows what they're doing." — Joel ([19:23])

• The ESPP 'Trap':

  "By over indexing on your company stock and the fact that you're getting it for a discount, I think it kind of plays into the endowment effect." — Matt ([38:09])

• On Homegrown Coffee and Spending Wisely:

  "It's not like it would, in reality ... It's somewhat of a money win, but it's more of a lifestyle upgrade." — Matt ([15:10])

• Leasing vs. Buying for FAVR:

  "Leasing will almost inevitably cost more every month. ... It still wouldn't be as financially optimized as driving a slightly older car that gets the job done." — Joel ([47:43])

• Life Insurance Proactivity:

  "You need to make the formal request for reconsideration. Not all life insurance companies offer this either. ... Again, we are like fans of term life for most people because it is dirt cheap." — Joel ([54:16])

• Mortgage 'Hacks' Skepticism:

  "Paying off the less nefarious mortgage than, let's say, credit card debt, personal loans, car loan, whatever else you might have going on." — Joel ([57:30])

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Timestamps of Important Segments

• [02:12] — Matt’s story: The true cost of a speeding ticket (insurance impact)
• [09:32] — First main question: Inheritance, advisors, and financial peace of mind
• [11:28] — Coffee-roasting: Money-saving or hobby spend?
• [31:18] — ESPP overview and optimal strategy
• [42:00] — FAVR reimbursement: Lease or buy for work vehicle?
• [52:16] — Listener “money win”: Life insurance savings after losing weight
• [55:23] — Mortgage hack hype: Best use of extra cash?
• [59:00 – End] — Personal reflections, beer review, and closing

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Language and Tone

The atmosphere remains conversational, witty, and supportive throughout, filled with self-deprecating humor (“we put out some rough episodes”) and playful jabs (“it doesn’t feel like it should be illegal to have this good of coffee at home”). Their advice is practical and rooted in lived experience, never condescending or dogmatic.

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Summary

This episode is loaded with pragmatic, step-by-step responses for those at every stage of their financial journey—whether navigating windfalls, work benefits, or simply questioning viral finance “hacks.” Through real listener stories, Joel and Matt demonstrate their core message: Thoughtful, informed decision-making (not hype or shortcuts) is the foundation of achieving financial well-being.

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For more resources, check out:

• HowToMoney.com/ask for submitting questions
• HowToMoney.com/advisor (fee-only fiduciary advisor search)
• Term life and ESPP guides in their show notes

If you want financial advice that’s as approachable as it is actionable—with a side of good coffee and beer—this is your episode.

Transcript

[A]

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[B]

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[A]

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[A]

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[B]

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[C]

I'm Joel.

[B]

And I am Matt.

[C]

Today we're answering your listener question.

[B]

That's right, buddy. Happy Monday. And you know what I just realized looking over some of the listener questions we're taking today is that we're talking about all these things that I've never personally experienced. We're talking about vehicle reimbursements, an employee stock purchase plan, a large inheritance. These are all things that I have, not that I do not have firsthand knowledge or experience with. Well, it makes me a little anxious.

[C]

In some ways that's a good thing because a big inheritance means that you lost someone that you love.

[B]

That's bad news. And I have lost someone that I love, but didn't come with any sort of financial plus side. So I wouldn't mind receiving all of these wonderful things. And we'll get to some other aspects of personal finance during our episode today. But, hey, I wanted to share. A lot of times at the beginning of the episodes, we share a little personal story. A lot of times, we'll share money wins, like a deal that we got. Or was it last week? I talked about the air conditioning fix.

[C]

That's right.

[B]

It's been holding up so well, so great. Have you had any issues with yours?

[C]

No, not yet.

[B]

Okay. All right. I was gonna say the reason I'm asking is because I didn't use the entire bottle of the stuff. So you ought to stick it on your van and just to see where your gauge is at. And if so, you can preempt just a little top off.

[C]

Just top it off. All right, I'll check it out.

[B]

Anyway, enough of the good news. It's time for some bad news.

[C]

Throw yourself under the bus real quick.

[B]

Yes, we were driving out of town, and it was just me and Kate. And, you know, we're cruising along, talking with her, and I look up in the rear view, and you know what I saw?

[C]

Oh, no.

[B]

Blue lights. Yes, Yes.

[C]

I knew where he was going, and I wasn't rooting for it.

[B]

Don't you cheer this police officer on. Now, of course, I got a speeding ticket, and I swear that I was. I was just going along with the flow. That's just how I drive by default. And evidently, he had to make an example of somebody, and he chose the gray Honda Odyssey. I don't know why. He was just like, let's. Let's go after that.

[C]

Let that yellow Corvette go and grab this guy driving a minivan.

[B]

Was there not a Porsche or a Beamer zooming past as well? But of course, it doesn't really matter if you're breaking the law. If you're going above the speed limit, there's no excuse. I can get a ticket, of course. But I do think he felt bad for me. So he pulled me over. And I mean, truly, like, I even drove for a little bit because I didn't think he was coming after me. I was like, surely he's not coming after me.

[C]

Get arrested for evading.

[B]

And then he asked me to step out of the vehicle. No, actually, he did, because I think he kind of knew that may. Oh, he was maybe barely going faster than any of the other cars, but, I don't know, pulled me over, told me off speed, knocked the speed down a Little bit. So that it wasn't a super expensive speeding ticket. It was like 95 bucks.

[C]

Oh, that's not bad.

[B]

Not bad at all.

[C]

I mean, compared to what I hear other speeding tickets cost, yes, this was

[B]

honestly the most affordable moving violation I think I've ever heard of. But it's not that, that I'm concerned about. Of course. I'm concerned about the Comprehensive Loss Underwriting Exchange report, the tick mark, the demerit that's going to go on my Clue report. And I am like shaking in my boots a bit as to how that's going to impact my car insurance. Man, I'm so. I'm not looking forward to it. It makes me want to proactively, preemptively, proactively go out and see if they've got any courses I can take online. Because I'm Gimme all the trackers you want to. You want to track me while I drive so I can prove to you that I'm responsible, that I come to a slow stop whenever there's a stoplight, that I accelerate slowly, that I don't speed.

[C]

Well, in some insurance companies, they don't automatically raise your rates immediately upon that one moving violation. Especially it's under a certain. Like, what about aut owners?

[B]

Because that's why.

[C]

I don't know, I don't know exactly how they respond, but we'll see.

[B]

Yeah, I'll keep folks posted.

[C]

You know, it also, that kind of stuff, it. It damages your ability to go out there and get to shop around. Because if you get the more stuff on your Clue report, the more other insurance carriers are like, yeah, no, we don't, we don't want to quote your policy right now because I had that problem because I've had two homeowners insurance claims.

[D]

Oh.

[C]

In the last like six years.

[B]

You had the big one. You had the big one, the tree.

[C]

Yeah. And then when we were renovating our home, there was like, remember someone broke into our basement and they stole the H Vac. They stole the H Vac.

[B]

Your old house.

[C]

That's right. And so, oh my gosh, because of that, I have two claims. And so I reached out to someone and they were like, you know, you're a high. Call me in six months when this one falls through or falls off your Clue report. And I was like, oh, okay, Good to know.

[B]

Well, at least you're getting closer to getting closer. That was a while ago. Yeah, the H Vac issue. Yeah. Anyway, I wanted to share that because a lot of times when we share these little Stories. We're like, hey, you can do this too. You too can change the springs. What do they call the suspension springs on your dryer and keep it from, you know, getting all. No, this is one of those instances where I'm like, don't be like me. Drive slower. It was also in a construction zone.

[C]

Okay.

[B]

And I think that had something to do with it, too. But slow down. Drive safer. Not only are you going to save money because your gas mileage is better, but then on top of that, you've got the ability to avoid a moving violation. Like a speed and ticket.

[C]

Worse feeling, too. I can't think of many feelings that are worse than just like, what a

[B]

sinking in the stomach.

[C]

Yeah. Your stomach just like falls down to your feet. Just like, oh, when you see the lights.

[B]

Yeah. What was I thinking? That was so stupid of me.

[C]

But trying to get there 10 or 15 minutes faster, you know, But a

[B]

lot of folks getting ready to do some driving. Maybe over the fourth. Yeah. Slow it down a little.

[C]

Slow down.

[B]

Yeah. Anyway, that's my story.

[C]

All right, well, thanks for sharing. Sorry that happened to you. Yeah. Not fun.

[B]

It's how it goes. The beer, Joel, that you and I are going to enjoy Today is a 60 minute IPA by Dogfish Head. One of the. Oh, geez.

[C]

Classic. Have we never had this on the show before?

[B]

Maybe I should look it up.

[C]

Well, it's all right.

[B]

Maybe we have.

[C]

It's been a long, long time. All right. Have we. I think one of our. My friends gave us like 120 minute back in the day. We had that on the show.

[B]

Was it 120 or was it 90?

[C]

It was one of the two. I don't know, like. And 120 is like, oh, you know

[B]

what else he gave? I still remember the WWW though. There's some sort of worldwide stout.

[C]

That's right.

[B]

He gave us as well. That was insane. That was off the chain. It was a really big one.

[C]

We've had some good. So this is kind of the. They sell the 60 minute in six packs. So if you're looking for it, you can find it wherever your finer beers are sold. But let's get to listener questions. Matt, if for. For anybody out there who's like, I've got a question for Matt and Joel. We'd love to hear from you. HowToMoney.com ask has the simple instructions or you just say your question into the voice memo app on your phone and email it back over to us. Let's get.

[B]

By the way, I just looked it up. I couldn't resist. We have not had any of the minutes. Okay, so we haven't had a 1690. And I guess we didn't have that 120. That's surprising show either.

[C]

Maybe.

[B]

Maybe we just enjoyed that on the. Maybe that was the burner of an episode. I think we've only had two of those that we never. Not actually that was the one stuck

[C]

out there, I don't know, back in the day.

[B]

But we did have that worldwide stuff

[C]

so bad we couldn't release it. Yes, we've been there.

[B]

Which early on it had to have been really, really bad because we've put out. We put out some rough episodes. Let's be honest.

[C]

I know when people say, oh, I've been listening to the pod, I love it. I'm going back to the early episodes. I'm always like, stop, don't. No, you can maybe go back 100 episodes if you're so inclined. Don't go back a thousand episodes, though. That's just. Don't do it. That's just brutality to yourself.

[B]

Although, do hit play and just put it on repeat and walk away. Yeah, that helps the numbers.

[C]

That's right.

[B]

Yeah, that's good.

[C]

Help your boys out. All right, let's get to our first question. This one is about money falling in your lap.

[D]

What up, big dogs? This is Brady. I'm a solo entrepreneur, have a pretty healthy business, make a decent living with a small family. I've inherited some money after the passing of a family member and that money has been with their wealth management team for quite some time now and have chosen to keep it with these guys for several years. But I do feel like they're underperforming the market a little bit, which I know is pretty standard. They say it's best to diversify the portfolio with stocks, bonds, T bills, dividend yielding stocks in anticipation of market volatility and a reduced risk. Hence the lower performance compared to, say, the S&P 500. I know you guys say to drop financial advisors altogether, but I'm concerned about the stress of managing these investments myself and that stress affecting the performance of my business. Is there such a thing as peace of mind with a financial advisor? I've gone back and forth of whether to go the DIY approach or continue with the advisors. On a completely different note, have either of you guys entered all or some of your data into AI to get an analysis? I did so with my Robinhood investments for advice and got some interesting feedback around tax loss, harvesting redundancy, collecting gains while ahead and Reallocating. Curious about your thoughts on using AI for financial advice. And to be clear, my Robinhood portfolio is completely separated from my inherited portfolio. And lastly, frugal or cheap for you? Started roasting my own coffee beans, which I did that because I was tired of the price of coffee at the grocery store. Anyways, it's turned into a little bit of a slippery slope, paying for the roasting machine, espresso machine, you know, probably take a couple years to break even. But I now have this sweet equipment and can make my own fun batches and give it to some friends, which is also pretty fun. Anyways, thanks, fellas.

[C]

What up, big dog?

[B]

Oh, is that where we're gonna call each other now?

[C]

Yeah.

[B]

No, I like that. I was gonna say, speaking of helping your boys out, Brady, hook your boys up. As far as, like, coffee. I would love to try some of Brady's coffee. So he's talking about, you know, being able to gift it as to friends and family, but only if they're the

[C]

finest Guatemalan beans grown at 5,100ft above sea level. Right.

[B]

Oh, no, no. You can. You can get amazing beans from all over the world.

[C]

Okay.

[B]

Yeah. You can get some incredible, like, African bean, like the Ethiopian, the Kenyan. You can get some great stuff from Central America as well. It's.

[C]

Yeah.

[B]

I personally don't discriminate. A lot of it comes down to. Yeah.

[C]

How it.

[B]

Also how it's roasted.

[C]

Yeah. Yeah.

[B]

Anyway, it's.

[C]

And coffee is kind of like beer, right. In terms of flavor profiles being all across the board, depending on where it was grown and. Okay.

[B]

Yeah, yeah, yeah.

[C]

I don't know. I don't know much. I know enough to be dangerous in a conversation, but I don't know.

[B]

Yeah. And, yeah, you're more familiar. You've had some of the stuff coming out of Hawaii, the Kona beans. Wait, is it.

[C]

Yeah, I think Kona's overrated, though.

[B]

Oh, you think so?

[C]

Yeah.

[B]

Well, because the. I mean, the lore is that they keep all the good stuff for themselves, and so they're actually shipping out blends.

[C]

Oh, yeah. They sent almost anything you buy that's not. That's sold in the mainland United states is, like, 10% Kona, which says Kona on it, but if you actually go to Hawaii, you can get the, like, 100% Kona stuff. But it's really expensive. Yeah, but then again, coffee's expensive.

[D]

It is.

[B]

Except that. So this is what's really funny. So Brady's talking about, like, dabbling in the coffee, roasting. He's like it's so expensive at the store. And I love that. He's just. It is a slippery slope and at this point you can't say that. Well, I bought a separate roasting machine and. Oh, and I've also got the espresso machine. Like, you're not doing that because you're saving money doing that. Like, you're doing that because it's fun. Well, it's a hobby and you love it and you enjoy it. Okay.

[C]

And that is true.

[B]

But I will say I hear what you're saying though.

[C]

Over time it can save you money.

[B]

Yeah.

[C]

Like I'm thinking about our, our little bread making endeavors at home. So we got like, we literally go to this store and we buy five gallon buckets worth of wheat berries. And Emily, we've got a grinder, we've got a bread machine and she's like making fresh bread many times, many times a week. And the bread machine is unnecessary, but it makes it a lot easier if you want to make it regularly. If you got to actually fire up the oven, you're probably going to do it less.

[B]

It's a more efficient use of energy. From that standpoint, you're not getting the whole house super hot, but you are getting all the good smells.

[C]

And I think you could say I'm doing it to save money. And the truth is maybe over the course of like a decade, you save money, but over the course of the first like two to three years, you. You definitely don't. Sure.

[B]

Yeah. Okay. So. And what I was going to, I was going to backtrack a little bit and say maybe for my own person, in my own personal case, I can't justify that I'm saving money by the fact that I got the La Mizoco or Zotco I think is how you say it. Espresso machine I wasn't at all trying to justify was just a splurge. It was a splurge and I was owning it. I'm like, hey, I think we would love this and enjoy it. So I literally did not even run the numbers on it ahead of time. But because Brady came in with his coffee roasting expertise and or experience the frugal or cheap, I did run the numbers. And it would take a year and a half of me ordering two drinks, two flat whites at our local coffee shop. That's really good. I would have to do that every single day of the week or every day of the year. Yeah, Two drinks. In order for me to earn back the cost of the machine in a Year and a half. A year and a half. But the thing is, is that's totally absurd because that just feels like such a. I'm not going to go to a coffee shop in order to go, like two to go coffees every single day of the year. Gosh, if you did, doesn't that just seem insane? It just seems crazy. And so in that sense, it's not like it would in reality. Like, I only go there once a

[C]

week with you, but it's changed your coffee consumption habits and you drink more good coffee.

[B]

It has changed it at home. And so in that case, it's not. It's somewhat of a money win, but it's more of like a lifestyle upgrade in that sense, because we are, in fact, even though I'm not going to go to the coffee shop every single day, because guess what? We're not. I'm not making. I'm not pulling two drinks every morning. I'm pulling four. Like, I make one for Kate and one for me first thing when we wake up. And then after I take the kids to school, when I come back, round two, baby.

[C]

It's like to be even more indulgent because. Yeah.

[D]

Yeah.

[B]

And it's just.

[C]

It is very, very, very good.

[B]

And I love it. And this time of year, man, with it being warmer outside, doing ice lattes. Yeah, it's so good. Well, dude, I mean, this is so freaking great.

[C]

Like, not to highlight the thing that we talk about regularly on the show, but the craft beer equivalent, right? It's like, find what that is in your. For you, coffee is one of those things and you're willing to spend a lot of money on it.

[B]

I think it's surpassed craft. It feels like.

[C]

It feels like we don't drink nearly. Nearly as much beer as we used to drink.

[B]

I think it's against the law for me to say that my new craft beer in public is espresso, but get some hate mail when Kate and I enjoy them in the morning. Like, we look at each. I. I'm like, it doesn't feel like it should be illegal to have this good of coffee at home. Like, it's so great. We. We love it so freaking much, isn't it?

[C]

It's just so fun to spend money on something. Like, we don't talk about the joys of spending money. Well, very often. Like, actually, we're gonna have some upcoming interviews about that, which I'm excited about. But okay, let's get to.

[B]

That's only one part of Brady's question

[C]

that's only One part.

[B]

Yeah, he snuck a three for oner.

[C]

We'll get, we'll get to all the good stuff. Brady, specifically about this inheritance. I think that's the most pressing. And let's do it. Man, I'm sorry to hear about the passing of a family member. That is obviously what precipitates an inheritance. And man, I got to say this. I don't think Brady did anything wrong by not making a huge change immediately upon receiving the inheritance. I think there's just a lot of wisdom in letting things stay the same for a little while.

[B]

But the dust settle. Yeah, yeah.

[C]

Like I get that mixing grief and crucial investing decisions is just a bad idea. And it's not that you should let things stay the same or ride forever. Just kind of like checking out of the finances of this inheritance. But taking a beat. Right. Is really smart. And it's actually something that we tend to suggest in a situation like this. So I'm glad you're considering a change now, Brady, but I'm glad you also didn't rush into making meaningful changes in the heat of the moment.

[B]

I'm totally fine with that. And Brady also touched on the underperformance that he has seen though, with the, the management of those funds. Well, you know what, that's not illegal either. We're talking about a lot of different things that are legal and not legal, Joel, because it totally depends on what your goals are.

[C]

Right.

[B]

So this underperformance could turn into reduced losses if the market were to enter correction territory. If you're young enough and you're willing to take the risk, underperforming, it does feel like a crime. But as you get closer to the wealth preservation stage, steady returns are going to be a higher priority than seeing massive gains when you've got time to recover from market drops.

[D]

Yeah.

[B]

That volatility is ultimately to your benefit as you continue to buy. And if you want to continue with this advisor, I think it's important to have maybe a more frank conversation about what it is that you want and how your asset allocation is going to change over time, how that's going to help you to achieve your goals and ultimately to discuss the trade offs that come with making those changes there to your portfolio. So just again, not only when it comes to life stage and what your future goals are, but just in what you were saying too, Joel, the fact that like taking a beat, hitting pause, I think that was a goal right then and there was to make sure that you weren't making any sort of emotional knee jerk reactions and you can just say, well, that's what allowed you to do that. Because you could have made much bigger mistakes had you made a decision that may not have been completely thought through.

[C]

Yeah.

[B]

In the moment, in the heat of

[C]

the moment, always easier to look back and see things in retrospect. Let's say the market had had a poor go of it. You'd be like, oh man, those more conservative investments served me well as the market was going down. And so it's hindsight's 2020 and this is too. I want to get to Brady talked about, oh well, you guys, I know you guys are all about ditching advisors. I want to say we're not like I think maybe we were earlier on more so at least in our podcasting days. I don't know if I would call us anti advisor. I think we would just say I

[B]

think we're still probably pretty balanced when it came to oh, it just depends on who you are, what you want to, what kind of professional help you want to have alongside you. And I think part of personally we probably were much more like, yeah, you can get by without that.

[C]

Well, especially when you think about like who the how to money audiences. Who the core how to money audiences. It's, it's millennials and Gen Z is the bulk. Right. And so for those, for that segment of, for those individuals, it's just, it makes more sense so often to DIY it and not pay big fees. But as your investing decisions and your kind of life finances become more complicated, you might want the input of somebody who has, who knows what they're doing at the same time. I think even since we've started the podcast, Matt, the advisor offerings have improved. So the pitch I think that's true from advisors is less now I'm going to beat the market. Which was like a pitch I think that you used to hear. And now people are like, okay, but I don't know. I've heard about this. And most advisors don't beat the market. So how are you actually going to beat the market? Tell me about that. Advisors are more pitching holistic planning, right? Like thinking about taxes a decade or more into the future, thinking about your short term, your medium, your long term goals kind of in the trajectory of those things. What does it look like to save for a house and to invest for your future? Like all sending your kids to college without going broke, taking vacations that are good for your like they're going to create long lasting family memories. Maybe you're like, oh, I want to, I want to start my own business as well. Like, those are the kind of things advisors can help you prioritize all of those goals. Like, trying to achieve all those goals simultaneously, effectively. They can. Right. Like, but again, most young how to money listeners will be better off diying it because every dollar matters in those early years and your life is just typically less complex. But as you get older and as you accrue a bigger nest egg, more money, more problems. Matt. Or at least more complexity. Right. Where an expert can offer a lot of help and I think some peace of mind.

[B]

Yeah. I think so much of it, like, as I think about, like, what it is that sets a younger investor apart, it's just the fact that what they're doing is just the same thing. Rinse and repeat.

[C]

Yeah.

[B]

As opposed to. It's somewhat, I think the complexity. Yes. But I think it's also the drawing down of the portfolio that feels a little like, okay, how do we, how do we shift gears? How do we transition? Like, it makes me think, okay, so I'm thinking about like a road trip. Imagine if you, like if I said, okay, I'm just going to get in the car and I'm going to head west and I'm going to drive for

[C]

like 12 hours and I'm going to go 95 miles per hour because I'm at home now.

[B]

I'm going to follow the speed limit and not get a speeding ticket. But I can do that. Now, equate that to me just being like, oh, all right, I'm going to save and invest over my lifetime. Now, the amount of time that I'm spending on the interstate, I think you can equate that to investing in low cost index funds. Like, you're just doing that mile after mile after state after state after state. And you don't need the turn by turn directions.

[A]

Right.

[B]

Like, literally, I can just look at the big green signs and just generally head west and I'm probably going to end up in Texas. I'm going to end up in Dallas, Fort Worth by the end of the day if I just like, you know, keep on going. Now, when it comes to arriving at my actual Airbnb, right. That I've got. Okay, well, I don't know, like, I don't know where exactly where it is. Like, oh, at some point I know I need to take this exit, but then you're dealing with like, state highways and surface streets and, oh, don't turn into this driveway. Turn into, like, there's all these other finer sort of details where, you know, What I am going to pull out the phone, I am going to punch in the address. But for the most part there's not a whole lot of complexity. And because you're just doing the same thing, like those interstate miles to me are like investing in low cost index funds where there's not much change or any sort of variables that you really need to think about because you're just doubling. That's all you're doing. In a similar way, I think that's maybe a, I think that could be a helpful way for folks to think about financial advisors. It's a lot of times they're towards the end where they're thinking, okay, you know, we've been going the right direction to help us land this plane. Like, help us to arrive at the desired final destination in a way that's not going to completely derail the entire trip.

[C]

Yeah, yeah, yeah. And I just want to mention too that just because an advisor might make sense, given the added kind of complexity and nuance that Brady's facing, and I don't know how much money this inheritance is and whether like he feels comfortable kind of managing on his own and funding some of those short term, medium term and long term goals that he has, kind of divvying it up in some ways or if he's like, no, I really do feel like I need to approach because this is a substantial amount and I want to make sure from a tax perspective, from like an optimization perspective, I'm, I'm including somebody who knows more than I do. Yeah.

[B]

To me that feels like it's not just you. If it's a lot of money. All right, I'm going to really extend the metaphor here. If it's a lot of money, then that's you driving a whole bus load of your family members.

[C]

Yeah.

[B]

Whereas if it's just you, it's like, okay, it's no big deal. It's just me. There's not a whole lot at stake. But if there's more people counting on you, that feels like you're driving a tour bus full of your relatives. Relatives. And you're also trying to get to this air, dude.

[C]

Well and truly, when it comes down to it, some of the, like making an incorrect, like non advantageous tax move just has a bigger impact in terms of a monetary perspective. Right.

[B]

Impacts everybody.

[C]

The penalty's bigger on the trip, so

[B]

it's, it's a little more costly.

[C]

Yeah. And so like getting that right, it's, it's, it's more worth the cost. You can justify it more than if you're early on and you're just like in those early miles of that road trip. And I just want to mention to Brady that you don't have to stick with the advisor that the inheritance is currently with. You might want to go out there and you probably do want to find an advisor you feel comfortable with, not just because this current advisor has underperformed the market, but because you're like, I want to find the person that I trust that kind of thinks about money the way I think about it. I would say a fee only fiduciary. That's paramount. When you're looking at advisors, then you can decide whether the cost is worth the reduced headaches of delegating some of these bigger financial decisions that you have. Coming up, we've got the site howtomoney.com advisor. It's pulling from vetted fee only fiduciary advisor. That's where we recommend people turn if they're looking for an advisor. It's one of those things where whether or not you're ready for it depends on a whole lot of personal factors. Then hiring the right one becomes important. It's okay to break up with an old financial advisor. You didn't choose to move to one that you did on purpose. Yeah.

[B]

Yep. It's for that reason that I find his question about using AI for to direct his investments incredibly interesting. Because. Because on one hand, it seems like he's like, oh, I'm not totally sure. I think I need. Need to have somebody here to kind of guide me along. But then on the other hand, he's just like, pew. Pew feels like you should shoot from the hip a little bit when it comes. And maybe it's because there's fewer passengers on the Robinhood train, which is his brokerage account. He doesn't have a whole lot of dollars in there. That being said, I mean, I'm not turning to AI for or any large language model. I'm not looking at chat. I'm not looking at Claude. When it comes to directing where my dollars go. I would Brady, use it to engage in thoughts and conversations that could give you the type of questions to help you to vet your financial advisor or whoever it is that you have. Punch some scenarios into there. And I think that that could give you some, maybe even a better understanding to understand why it is they're doing what they're doing, why maybe, in fact, hey, I'm gonna push back against that a little bit. I don't think we should be doing this. And yeah, in that way, I think it can be another tool for you to help you to partner with some of those advisors. Well, but I'm definitely not gonna be uploading. You know, he said something about uploading his info.

[C]

Oh, that, That's a.

[B]

No, no, no, man. Like, I'm gonna delegate or I'm gonna dictate what it is that I've got going on.

[C]

But you know what that reminds me of?

[B]

It feels a little. Yeah, I don't like the integration just yet.

[C]

I'll just say that just giving away some personal data information that you really should probably keep private, it makes me think of the, like ancestry.com and stuff like that and how it's really kind of fun to look into your family history. I never did it. I'm not even like a privacy freak, but I was like, golly, that seems like you're giving up a lot of information to this company. And then didn't one of the companies go bankrupt? Didn't we talk about it? And then they were like selling some of that information to third party.

[B]

Was that 23andMe?

[C]

I think it was 23andMe.

[B]

So that feels a little more an invasion of privacy to me because that's like your literal physical genetic material versus like the family ancestry thing. I don't know if it's a little outside of you. It's like, okay, these people could also give that information. But there's only one person who can give my DNA information. Yeah, like if I'm going to put a swab in my mouth and send it, mail it off, and they're going to. I don't know, what's it called, where they map out your. The mat genome project. I don't think I want to engage in that for real. That's something I'm going to think twice about. I'm also going to think twice about uploading or giving direct access to any sort of large language model, my investing logins or anything like that.

[C]

I agree. Yeah. I would not upload everything and ask it for a plan.

[B]

Use it as a tool. I think that's great. But personally, maybe it's fun to upload some or to manually upload some of the information just to see what it would say. But again, it's for you to engage in a sort of dialogue with yourself, with your family, business partners, and ultimately, I think your financial advisor as well.

[C]

I was going to say, I guarantee a great financial advisor asks a lot of questions. They're trying to get a lot of information from you about who you are. What you want, where you're headed. And if you're just like uploading something to a large language model, they're making

[B]

a lot of assumptions.

[C]

They're making a lot. Yeah, exactly. Exactly. They're treating you like a stock American individual and you are not. You're Brady.

[B]

That's right.

[C]

All right, we got more to get to Matt, including we're going to talk about leasing a car. Does it make sense? Especially when the business you work for reimburses that expense. We'll get to that and more right after this.

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[B]

Alright buddy, we are back and yes we will get to that car leasing question. We'll also cover some mortgage hacks or some quote unquote air quotes. Mortgage hacks.

[C]

We still using the term hacks? We are.

[B]

But before that, let's hear from a listener who has a question about his espp.

[C]

Hey Matt and Joel, this is Also, Matt calling from Medford, Massachusetts.

[B]

My question is related to my employee stock purchase plan.

[C]

I have a pretty typical ESPP. It gives me 15% of a discount

[B]

on my company stock. There is no holding period after the purchase date. And I have the look back provision as well. My question is, it seems like from the research I'm doing that doing a

[C]

quick sale of the ESPP is a no brainer that I did a. I

[B]

think it's like a 17% return on investment no matter what. And that assumes that the stock does not perform well between now and the purchase date. It doesn't seem like the tax implications of this are anything to be worried about.

[C]

So I'm just curious what your thoughts are.

[B]

What else do I need to consider or should I utilize the ESPP and

[C]

just hold the stock?

[B]

I think it's important to note that I do believe in my company stock. I think I'm in a good industry and a good company with great growth projections. But I just don't like having all of my eggs in one basket or one stock. So I'd rather get the guaranteed roi, cash that out, sell it, and potentially consider putting that money into a well diversified index fund or etf. So let me know your thoughts and really enjoy the show.

[C]

Thanks, Matt. Did farmers back in the day really take two baskets out to get their eggs just in case they dropped one?

[B]

Maybe they stored them in multiple baskets once they got them back to the farmhouse, perhaps.

[C]

Okay, well, I mean, I guess that's

[B]

like, Wait, that's why they, that's why they created the double. The basket that's got the two lobes. Have you seen those? They kind of looks like a butt. Talking about like it kind of comes up in the middle a little bit. Maybe that's because in case one side falls out.

[C]

There you go.

[B]

You're diversified.

[C]

Yeah, that's right.

[A]

Boom.

[B]

Original farmer wisdom.

[C]

Yeah.

[B]

Is applicable to personal finances.

[C]

It is. I love that we're like still using aphorisms like that because I mean, dude, it's that wisdom still holds. Right. And so, yeah, that's a plug for diversification there. And this is kind of part of Matt's question is like, can I use an ESPP effectively without essentially having like too much tied up in my company? Because I get a paycheck there and then I also like have, I'm investing in that company stock.

[B]

And so also a lot of my friends are at my company as well. Right. Let's talk about social. Like there's other ways, you know, think about all the things that our jobs do for us.

[C]

So I don't know.

[B]

He's not asking about that but.

[C]

But yeah, that's.

[B]

That can be a weird tangent if we go down that. So I don't feel the need to.

[C]

But that is where the risk of like hey, I think things are good at my company but maybe there's some things I'm not privy to and maybe, yeah who, who knows maybe there's leadership change and the like the next course over the next five years is not going to be good for the company. I sure hope that's not the case Matt.

[B]

But like you never know.

[C]

You never know. And this is the reason to, to not like over index right into one company and tying not just your livelihood but also your future investments to their performance. But ESPPs are great. So if I was in Matt's shoes I would take full advantage of the espp. Oh yeah. Despite what I just said about diversification. And I'll explain. We can, we'll explain why. But you know, let's just first highlight how good this ESPP is. Matt mentioned a look back provision in the question.

[B]

So nice.

[C]

Which means he gets like not only like a 15% discount on the stock that he's buying but he also gets a lower price than the general public is able to get because he can get the stock price at the beginning or the end of a six month window, whichever one is the lowest. Exactly.

[B]

You're getting the best stinking deal which is awesome.

[C]

So you get a 15% discount on potentially an even much more discounted price.

[B]

Must be nice. That's all I'm going to say.

[C]

Well once we go public we'll offer that same thing to never had any spp. Sounds awesome the folks who work here. But yeah. So this makes the deal look even better. Could potentially substantially better than just a straight 15% discount which is already a nice perk. So I guess I just want to say I'm with you Matt. It's a no brainer to take advantage of this ESPP option. We just want you to use it wisely.

[D]

That's right.

[B]

And part of using it wisely is dialing in your specific strategy so that you are not taking on too much risk. So you would take the quick flip strategy. This is something that I think I would do were I in your situation and basically sell your stocks as soon as you're essentially you're taking advantage of the discount that you are immediately getting but then you are getting out. But this is known as a disqualifying disposition. So you're going to have to pay tax on that. Depending on your income, it's likely not the best move from a tax standpoint, although from a mental standpoint, from a diversification standpoint, a future wealth standpoint, I think it is. And you mentioned not wanting to pay. Put all your eggs in one basket, right? This is why you would take this approach, this sort of flip approach. And it's why a generous ESPP like this is worth taking advantage of. But again, if you hold on to company stock for too long, you are definitely amping up your risk in other ways.

[C]

Yeah, yeah. Because if you, if you hold on too long, you're just. That's right. You're just like indexing in a riskier direction. Even if you believe in the upside of the company, what you do, it's just unwise to own too much company stock stock ever. That goes Matt, not just for individual companies investing in individual stocks, but it's even riskier to invest heavily into the individual stock of the company that employs you. I think your belief in the company's future will shake out already in steady employment and promotions and raises. Just be thankful for that. You don't have to try to capitalize on the upside of the stock as well. The only real reason to own this stock is because the optimization play you're able to make not to buy at a low price and to hold on for many years or even decades in hopes that you're going to outperform a total stock market OR S&P 500 index fund. I think some people might think that it's this way to support your company, to be a team player. But I think you can be a team player in a whole lot of other ways. You don't have to put your future investments at greater risk in order to do that.

[B]

So I'm speaking as an outsider yet again. I'm highlighting how this is not something I've ever had available to me. And it must be nice, right? Like I was kind of joking about that and I was literally thinking through that. I bet it does feel nice. Like there's something about it that feels like you maybe that you're privy to information that like the rest of the market doesn't have. Like, it feels like maybe you've got the inside scoop. And by over indexing on your company stock and the fact that you're getting it for a discount, I think in a way, I think it kind of plays into the endowment effect.

[C]

Right.

[B]

Like you're like, oh, this is my stock. And what did you see with that stock, your company stock. And you've got the name, you got the security badge and whatever, all the accolades that come with that particular. It's like salesforce or something, you know, so like, like you've got the briefcase and the, the.

[C]

You might even have the branded yeti water bottle, sweater, zip or the 3/4, 3/4. If.

[B]

But because you've seen that immediate sort of discount, the fact that you're getting it on sale, I think maybe what happens is it puts it in a better light than it actually is and you feel some sort of like emotional attachment to it. And so because of that, that endowment effect kicks in and you. I wouldn't, I am curious if, and there's no data or studies here, I'm just like making this up. But I'm just again trying to picture myself in his shoes and I could see myself falling into that where I'm like, oh no, no, this is a winner. Like, why would I want to get rid of this? Are you kidding me? I want to grow my wealth, man. And I've seen it grow not only because of the discount, but, oh, because he mentioned 17%. So maybe it's gone up like a little bit over the course of the quarter. And let's just say you see it improve like 5% or something like that over the period. Like you're seeing over 20% in gain. And it would be very easy to talk yourself into saying, I'm going to let my winners ride. Like, why would I get rid of this? Are you a dummy?

[C]

But the win was in the buying in the special deal, not in the holding.

[B]

And that's what you have to remember. But I think just by holding it for a second, there's something that takes place mentally where you're like, no, no, these are my stocks, you can't have these. I'm not going to sell these to you. Why would I want to do that? You want to avoid that trap. Instead, look to markets and look to what history shows us, which is being diversified is the way to win.

[C]

Yep. I do see that as a potential mistake to kind of get too attached to something that man, really, this is a benefit, a straight up benefit that you should take advantage of and not

[B]

something it's like a one time benefit versus this ongoing relationship.

[C]

And I guess at worst you mentioned the flip strategy. The, the maybe most risky thing you could do if you wanted to try to reduce tax implications is to hold on for a year post purchase because that's when you, when you cross like essentially a threshold, you Receive superior tax treatment, you'd still be taxed on the discount you received at your ordinary income tax rate, but the gains that you experience would be taxed at a superior capital gains tax rate. Again though, this ramps up your risk level. I'm not sure we're talking about high enough dollar amount to really, to really merit holding onto it longer. But I just kind of wanted to throw that out there. That yes, that does change the tax implications at least a little bit.

[B]

That's right. And then what should you do once you sell? Well, take that money, put it in more diversified investments. That's the name of the game here. That's the answer we're giving. If you are Roth eligible, if your income is low enough, make sure to max out your Roth IRA and invest in more diversified assets like you mentioned. But if not, either contribute more to your tax advantage plan there at work. That's like next on the order of operations here. And then after that consider a taxable brokerage account. But ultimately the best way to think about your ESPP again is like as this compensation enhancements, not as a long term investment strategy. This is a relationship. You're not marrying these stocks, you can unload them as soon as you'd like. It's a part of your total compensation plan here. It's akin to your 401k or even to like a solid health care plan. So make sure to use it properly. Set a calendar reminder too. That way you don't forget. It's one thing to intentionally do it. It's another. It's a whole nother thing to fall into that. Oh, I forgot to unsubscribe to Netflix after the seven day trial. Yeah, actually did that recently with. What was it?

[C]

They still do free trials on the Peacock?

[B]

No, I did it recently. Peacock 3 prime. We were looking for. Oh, the Mario movie.

[C]

Okay.

[B]

And they had it there. So I'm like, we can rent it for $4 or we can. I can set a calendar reminder.

[C]

Just kind of actually make sure.

[B]

You got to make sure to do it. So Matt, just make sure that you're not letting that one slip through the cracks. Joel, let's get to another listener. This is the lease. The car lease question. And this one is specifically from Jesse. My question is about cars. I currently own a 2022 RAV4 Prime. I have no payments. My company utilizes the favor program or the fixed and variable rate reimbursement program allowing tax free reimbursement. I am currently in compliance with the program, but at the beginning of 2027. My vehicle will pass out of the compliance window of a vehicle being four years old or less. A monthly payment is calculated based on location and then a variable rate is paid out for each mile driven. Have you worked with the Faber program before? In 2027, does the math say take the decrease in monthly payments to keep using a vehicle owned outright? Do I sell the vehicle and buy a new or used car and keep me in compliance for another year or two or lease based on the rolling nature of the program? Leasing has always been a bad choice for me financially, but based on my new situation, could it make sense? Car brand does not matter to me in the least. I look forward to hearing your opinion and I love the show.

[C]

Oh man. We just found the rare exception to the Leasing cars is a really dumb idea advice that we typically.

[B]

Let's unpack it. Yeah, let's, let's, let's let Jesse know.

[C]

Yeah. And we'll find out like it's, it's actually in this situation.

[B]

Depends what you're trying to optimize.

[C]

It does.

[B]

It does if you're optimizing for that new car smell. Get it, Jesse, lease that car.

[C]

Well, in this, in this circumstance it's maybe less bad. Right. Than it would for somebody who's not getting any sort of reimbursement. But it's still not the optimized.

[B]

Less bad, but still bad.

[C]

Still bad. Still not the best decision. So let's mention quick Favor, which Jesse mentioned, which stands for fixed and variable rate. This is a tax free reimbursement program for your vehicle if you drive one for work and if your employer subscribes to the favor method. It's pretty great for people who drive their own car for work. It's the most accurate system too because it has this two bucket approach. One bucket covers the fixed costs that you incur like insurance premiums and depreciation. The other is for variable costs like gas maintenance and tires. The flat monthly check approach to car allowance. It might sound like it's going to be easier, but it's not necessarily. And it doesn't come with those same tax benefits. I think this is a good perk for Jesse to be in this favor program.

[B]

Yet another one of these sweet employee offered perks that we've never. Maybe this is one we can do, Joel. Although we always talk about how we walk and bike to the office. I know there's no, I don't think there's any favor benefits being paid out

[C]

legally at least maybe can pay for my new running shoes or Something

[B]

what's great too about this program is it takes into account local conditions. So it's a federal program, but it's administered. It takes into account local information. Basically. Jesse, he didn't say this, but in his email he included that he's from. Was it like Tacoma or Spokane?

[C]

Washington state?

[B]

Yeah, somewhere up there. But he's in Washington state. And the gas prices are higher out there, which means you're going to be reimbursed at a higher rate, which is pretty cool. I want to point this out though, Jesse. Just because you are getting reimbursed does not mean that you have to actually spend that reimbursement there on the vehicle. So most folks think that because it's their quote unquote car allowance that, oh, okay, well, I'm going to spend that entire amount on a car payment or just on the like the total cost of car ownership. You can. But instead, I would rather like to think of this reimbursement as just sort of like we're talking about the ESPP in the previous question. This is just a part of your overall compensation, which means that every dollar that you eradicate from spending on car stuff is more of this tax free money that is coming your way that you get to keep it. Actually, it makes me think back to speaking of car stuff. I remember getting hit as a teenager. Somebody kind of sideswiped me a little bit. I was like, I don't know, what is this? I'm 16, I don't know how to do any of this, whatever. And my dad was like, all right, we got the police report. They were ticketed, got quoted out and sent it over to their insurer and got the check. And I remember my dad telling me, he's like, great, that check is there to you. You don't have to fix the car if you don't want to because it wasn't that big of a thing.

[A]

Yeah.

[B]

And of course, young foolish, not money savvy. Matt was like, no, I want to. I don't have a busted up ride. I'm 16. This matters. Whereas now I would 100% just keep the money.

[C]

Yeah. S and P. Wait for someone else

[B]

to hit sock it in yet again. Anyway, just wanted to mention that, Jesse, that you don't have to necessarily spend this money that's coming your way.

[C]

No, that's right, that's right. You can think of this as the gap that you can grow between what you're spending and what the car allowance you receive is. Is free money. Right? Like it's additional Pay just coming from essentially a different direction. And so I would think of this as a business expense and the goal is to minimize this business expense to keep more money in your pocket. It's kind of similar how we talk about write offs, Matt. Like yeah, you can buy a more expensive computer and you can write off a bigger amount, but you also spent more money on the computer. And so if you don't need the fancy high end laptop, don't get it because you're like, I'm doing it to get that sweet larger tax benefit. That's just self defeating. Right. You're still out more money and you don't want a crappy car that's going to have problems regularly. I mean, and in fact, Jesse's kind of forced to have a new ish car and he's just not allowed to drive a 10 or 15 year old car. If he could, man, like think about how big he could grow that gap if he could drive something older. But leasing will almost inevitably cost more every month. Yeah, I mean could you lease a car and pay less each month because of your reimbursement? Sure, I guess. But it still wouldn't be as financially optimized as driving a slightly older car that gets the job done. That's what's going to keep more money in your pocket.

[B]

Yeah, I like that you said new ish because I think what he's doing now is pretty ideal. By the way, he mentioned the 2022 RAV4 Prime. Man, I so wanted one of those a few years ago. But that being said, I'm glad I don't.

[C]

And when you're thinking about ideal cars to have a solid gap on, like that's a great car, right, to have into this reimbursement program.

[B]

Yeah. But again, going back to newish, I like that approach. I think folks who are keen on wealth building should opt to make sort of a more calculated upgrade in order to keep their car compliant. And because of the depreciation piece of favor, it's based on a car's new value. So if you keep that in mind, buying a gently used car that has already taken that massive depreciation hit, it puts you ahead financially. So yes, you know, if you lose lease every three years, you wouldn't have to worry about staying in compliance at all. But you're not going to reap the massive financial benefit of buying a very nice new ish vehicle that's very fuel efficient. That's only a year or two, two years old. Just something pretty dang new. I think that's, that's, that's how I would do it.

[C]

Well, I guess the other place that a lease could come back to bite you as well is if you drive a ton of miles and you go over the mileage amount that the lease says you can do. So if it's 12,000 miles a year, let's say, on your lease, and you're a heavy driver because you're driving all over the state or all over the region. Yep. Then think about how much of a, an over mileage penalty you could pay. Right. And, and that could, that could put you in the penalty box even more from a financial standpoint. Just sucking up, maybe the whole, you know, car reimbursement and more, I don't know. So I guess I would say hold onto this RAV for as long as you can until you can't anymore, until it literally falls out of compliance and look for something right at that line that's a few years newer, that's similar. It's comfortable, gets good gas mileage. The leasing is not going to be the most financially advantageous choice. I think you're right, Matt. The one year old car, do that, you're reaping some of those depreciation benefits and then just wash, rinse and repeat. Do that every three years. Because yeah, the one you bought just a few years ago is going out of compliance. It's kind of sad like that you have to recycle cars like that in some ways. But if those are the rules and you got to abide by them. So abide by them, but do them in the way that's going to like be the most financially advantageous for you.

[B]

That's right, Joel. We've got more to get to. We're going to hear from a listener who's got an insurance win. We'll hear from that one. We'll get to that one and more right after this. This July 4th, come celebrate at America's Block Party. Hosted by America250. America's Block Party is a can't miss 4th of July concert happening at the Los Angeles Memorial Coliseum.

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[C]

all right, we're back. We got more of your questions to get to. This is of course we gotta get to the Facebook Question of the week. Matthew, this is more of a statement, but I was like, oh, this is worth sharing and we could talk about it for a second. This one was from an anonymous listener posting in the how to Money Facebook group who said I wanted to share a money win. Several years ago I bought a 30 year term life insurance but my premium was surcharged because I was overweight. Over the last two years I've lost the extra weight and was able to re quote my existing policy and obtain a quote for a new one that's about $500 a year cheaper. He says. I'm still not getting the best rates because of the history, but I was told that if I could maintain a healthy weight for two more years, I could ask them to re rate me again for a further discount. So if you've had a positive change in your health, consider re quoting or asking for a RE rating for your life insurance policies.

[B]

Nice. I love this. And to this anonymous poster, congrats on losing the weight because you know, takes a lot of hard work, takes some dedication. And it also makes sense though that your insurance company is going to charge more if your BMI is too high. Right. Like it makes me think about if you're underwriting a smoker, you are insuring a higher risk individual but over time, yeah, reducing those risk factors. Man, I love that this poster is really saving money by not only decreasing their risk and exposure to that insurance company, but by keeping that in mind and then reshopping with a different provider. So like you were saying earlier too, like you get some of these claims rolling off the back end of your clue report, now's the time to take advantage. So I love that this person, I've not heard someone doing that when it comes to life insurance. So I think it's great.

[C]

That's smart. So cool. Yeah, it's only, I don't know how long it's been. Right. Since the original policy was written. Said what, several years ago? I think. So if it's only been, let's say, a few years, you might still want to shop the open market again. Right. Because if it's been a lot longer and you're much older, getting a requoat on your existing policy, that might be the best bet in terms of saving money. But if it's just been a couple of years, you might find that going back to a site like policygenius, checking with Costco, if you're a Costco member and their term life insurance program, you might save even more by getting a completely new policy instead of sticking with the one that you got a couple of years ago. I just want to say this too, Matt. Your insurance company isn't kindly going to ask if there's a reason they should reduce your premiums. That's not how it works in the real world. Right. And so you this, this listener did it. You can do it. Other listeners, you need to make the formal request for reconsideration. Not all life insurance companies offer this either. And so if yours doesn't, I would check the market to see if you can score a better rate. We have a term life insurance shopping guide. We'll link to it in the show notes. But again, we are like fans of term life for most people because it is dirt cheap and you can get a lot of coverage for your family if you were to pass away prematurely. It's one of those like adulting tasks that's really important and most people put it off too long and then they shop around and they're like, oh, that $500,000 policy is like $24 a month. That's crazy. I would have done it earlier if I had known that it was, you know, roughly the cost of one or two of my streaming subscriptions. That's right.

[B]

Some would even call shopping for life insurance a summer chore. Joel, let's take that mortgage hat question here because we teased to it earlier, even though we're going along here. This is an anonymous poster as well. Who wrote my Feed is full of mortgage hacks. To save or cut years of payments over the years, looks like I have to take my principal and my interest and then divide by six and then pay on the 15th of the month to get the benefit. Does anyone else do this? Mine looks like it would be an additional $190 a month. Part of me thinks I could do this, but then the other part of me is thinking I should put that money somewhere else. Also, if you stand on one foot and put your finger on your nose and hop three hops to the west and what do you think?

[C]

What does that do? What does that do?

[B]

It magically makes your PMI go away.

[C]

Oh, that's fascinating. I didn't know that.

[B]

Which, when I say it like that, makes it sound like BMI for some reason. Like some sort of both.

[C]

Yeah.

[B]

Health ailment. But that's not what we're talking about.

[C]

No, you're referencing private mortgage insurance, which is different. But I. First, I gotta say, I love the desire to get rid of debt. I mean, I think that is a good thing. And in terms of. Even when we're thinking about optimization, we also have to think about the negative realities that having too much debt on our plates comes along with. I guess the first question I would ask this listener is whether they have other forms of debt. Because if so, chances are high that it's worth paying off those first, that the mortgage debt is just the very least of your problems. You're going to free up more cash flow. You're going to be eradicating these worse forms of debt that come with higher interest rates. If you were to kind of start paying those off first instead of trying to like, fully optimize your mortgage. Sometimes, Matt, you hear like a social media video about optimizing your mortgage payoff and you're like, oh, that's what I want to do. And you're just not thinking because you're like, got that tunnel vision. You're just not thinking about how. How imprudent it would be compared to some of the other maybe peskier kinds of debts you have hanging on. And getting rid of those sooner would be just so much more valuable. And so I think those mortgage hacks can be enticing. Just don't want to get the car before the horse. Paying off the less nefarious mortgage than, let's say, credit card debt, personal loans, car loan, whatever else you might have going on.

[B]

That's right.

[C]

Yeah.

[B]

So that's the debt side of the equation. On the other side of the equation is what else you could do with that money. And I'm talking about investing, right? Like I don't know if you are investing your dollars but, but on the positive side of the ledger, if you don't already. Well, even before that, if you don't have a really good emergency fund, well, you need to do that. But then in addition to that, if you're not getting the full match from your employer on a 401k, if you aren't maxing out your Roth IRA, there's a lot of other options out there and that would be a better place for you to put your money. So I would agree with you there. You know, it's great to pay off a mortgage early. Going back to what Joel was saying, I love the desire, I love the general attitude there, but only if you've taken care of of those other money gears first. And by the way, even if you do find yourself in Money Gear 7, it's unlikely that paying more towards your mortgage principal is going to be the absolute best way to proceed. Although there is going to be a lot more optionality to make, you know, a less optimized choice at that point in your money journey. At that point, what I'm saying is more about the emotional payoff as opposed to the financial payoff. So I'm not going to totally knock on it, but for most people there are other things, better things you can do with your money, including paying off higher interest debt, but then making sure you're investing to the, to the hilt.

[C]

So maybe find the social media content that's like credit card hack for paying off or something like that. Turn your eyes in that direction. Again, we don't know exactly where this listener stands as far as like debt and investing, but just hopefully that provides just a step back from.

[B]

That's what you need to do here.

[C]

Yeah, exactly.

[B]

It's a zoom out and that needs to take place.

[C]

All right, let's get back to the beer mat. 60 Minute IPA by Dogfish Head. A true classic. This one's probably been, probably been brewing this for what, I don't know, 25 plus years.

[B]

You think that long? 25, probably say maybe 20, but goodness, that's true, I guess. I think I had my first IPA in 2006, now that I say it out loud, 20 years ago they weren't

[C]

too far after Sierra Nevada and Sierra Nevada, I want to say it's been around for 30.

[B]

So yeah, I remember my buddy just being like IPAs. It's an acquired taste because at the time I Just remember being like, whoa, this is better.

[C]

Well, they were just so different back then, as evidenced by drinking this today.

[B]

Yeah, this is a classic. It's got. Not much more of a malt presence, but very nicely balanced. Even though it's multi, it's not. I don't know, there's some multi IPAs you get, and they. They still taste bitter. Whereas this one, that's got. It's just well balanced. It's got the sweetness going on as well. Nice backbone. Yeah, very enjoyable.

[C]

Yeah, I was gonna say maltier, and I was also gonna say the hops, instead of being super citrusy or piney, they're more floral on this one too, which, yeah, it's just kind of like a classic, you know, 2000s IPA. And it's.

[B]

It's a nice mid aughts.

[C]

It's like a blast from the past.

[B]

Early aughts.

[C]

Beer. Yeah.

[B]

Really enjoyed it, and I hope you enjoyed this episode. If so, leave us a solid review. Only I'm not gonna say leave it. Leave a positive review over there, wherever it is you listen to your podcasts, Apple podcast, wherever it is that you might listen. If you want to send Joel a secret message, that's the place to do it. He always checks him right before he goes to bed. And so if you want to communicate, you can leave that message.

[C]

Part of my nighttime routine over there.

[B]

But that's gonna be it for this episode with warm milk, tart cherries. More people are doing that now, are they? Yeah, evidently it's a. It doesn't, like, put you to sleep. It's not like a sedative, but it does sort of partner with the body naturally shutting down. Evidently, Kate just bought some recently and we're starting to do it. It's a nice sort of ritual, not unlike your warm milk at night and podcast reviews.

[C]

Yeah, exactly. All right, that's gonna do it. Until next time. Best friends out.

[B]

Best friends out.

[C]

There's something specific with cherries.

[D]

Where?

[B]

Scratch. It has tryptophan. Okay, Joel, I am excited about this one. Here on the show, we are all about comparing prices to save money on so many things in life. So why wouldn't we compare prices for our next ride share? Taking a few seconds to check. Lyft can save you real money on your next ride. I did this last time. I caught a ride home from the airport after some travel, and guess who came out on top? It was Lyft. Don't just price check with your flights and phone plans and groceries. Comparing rideshare prices will help you to save money every time you ride. Save money. Check Lyft this July 4th come celebrate at America's Block Party hosted by America 250. America's Block Party is a can't miss 4th of July concert happening at the Los Angeles Memorial Coliseum.

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