Ask HTM - Medium-Term Investing Conundrums, Naughty Credit Card Behavior, & Vapid Vesting Periods #1051

Summary

How To Money - Episode #1051

Ask HTM - Medium-Term Investing Conundrums, Naughty Credit Card Behavior, & Vapid Vesting Periods
Hosts: Joel & Matt
Release Date: October 20, 2025

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Episode Overview

This episode features Joel and Matt tackling a wide array of listener-submitted financial questions, with their usual thoughtful, conversational, and humor-laced style. The main topics include optimizing credit card rewards, nuances of vesting periods for retirement plans, maximizing Health Savings Accounts (HSAs), handling medium-term investment dilemmas, and simple Roth IRA investing strategies. The hosts provide both actionable advice and deep context, always focusing on making personal finance accessible and practical.

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Key Discussion Points & Insights

1. Credit Card Optimization: Playing the 0% APR Game

[08:31–18:36]

• Suzanne's Dilemma: She asks about carrying a balance on a 0% introductory APR business credit card, putting the owed money in a high-yield savings account to earn ~$200, while paying only minimums until the offer ends.

• Matt’s Take:

  • Impressed with how responsible Suzanne is, noting her long history of paying off cards and being in "money gear 7".
  • “Honestly, this is why personal finance is so personal. Because there are a lot of other folks who might ask the same question. And I would just say, no, no, no, you go ahead and take care of that balance.” [11:05]
  • For most, not worth the risk, but Suzanne can handle it.

• Joel’s Advice:

  • Warns of retroactive interest if the payoff is missed (though less likely on this card).
  • Psychological burden is a real cost. If $200 stresses you out or makes you uncomfortable, “it’s just not worth $200.” [16:17]
  • Suggests setting reminders or scheduling autopay to avoid missing deadlines.
  • Carrying a balance on a 0% offer is not a moral failing; the risk is controllable for folks like Suzanne.

• Consideration:

  • Watch credit utilization, as carrying a large balance might momentarily ding credit scores, but it's minimal if you have excellent credit.

2. HSA Maximization and PMI Removal

[18:57–28:28]

• Jeremy’s Questions: Handling HSA (Health Savings Account) receipts for tax purposes and how to rid himself of PMI (Private Mortgage Insurance).

• HSA Advice:

  • Matt & Joel extol HSAs as the “quadruple tax-advantaged” account when funded via payroll deduction. [22:12]
  • Best practice: Digitally save all medical receipts and keep a tracker spreadsheet to record the date, amount, and provider. This ensures IRS-proof documentation.
  • “If you were to get audited, it’s to show them that, oh, no, no, no, I don’t need to pay taxes on this because I have the receipts to show...” [24:20]

• PMI Advice:

  • PMI typically drops automatically at a 78% loan-to-value ratio, but can be requested earlier at 80%.
  • For early removal, lenders may require an appraisal (cost ~$500), often recoupable within a few months of PMI savings.
  • “Trying to get PMI out of your life, it’s going to be a big money saver every single month.” [26:47]

3. Vesting Periods & Rollover Decisions: Workplace vs. IRA

[28:29–38:30]

• Katie’s Question: Old 403(b) account, new employer's 5-year vesting on match, and where to best allocate her retirement savings.

• Vesting Nuances:

  • Five-year vesting is quite long—a “mirage” if you don’t stay that long and never get the full match!
  • “If you don’t actually receive the match because you’re not there long enough, it was like this mirage.” [30:25]

• Account Prioritization:

  • Since Katie suspects she won’t stay five years, Matt & Joel recommend prioritizing Roth IRA contributions over the 403(b).
  • Suggests Robinhood Gold’s IRA with a 3% match as an option—consider the membership fee and 5-year holding requirement.
  • Always consider the possibility that you may stay longer than expected—could regret not contributing to a matched plan if you unexpectedly stay and miss out on free money!

• Rollover Options:

  • If former and current 403(b)s are with low-cost providers, consider consolidating for simplicity.
  • Direct rollover preferred to avoid tax implications; Roth conversions only make sense after careful tax planning.

4. Roth IRA: How to Invest the Funds

[39:01–44:44]

• Jessica’s “Explain It Like I’m a Child” Question: How much of her Roth IRA to invest, how to diversify, and how often to contribute.

• Simple, Actionable Answer:

  • Invest the whole amount immediately if no near-term need. “There is no reason to leave any of those dollars…sitting in a money market account.”
  • One or two broad index funds (like Total Stock Market or S&P 500) are plenty—avoid unnecessary complexity.
  • “The cool thing is that the simple choice is often the most ideal one as well.” [43:26]
  • Recurring contributions (monthly or annual lump sum) are ideal, and immediately invest each new deposit.

• Fun Analogy:

  • Comparing investing to drinking water: “That's like putting your dollars into your Roth IRA. But then what do you do with that water? Well, you need to actually drink the water in order to receive the hydration, the benefits…” [41:03]

5. Medium-Term Investing: Is It Worth the Risk?

[44:59–49:02]

• Anonymous Poster’s Problem: $25K for a rental property down payment in 2–3 years—save or invest?

• Risk vs. Reward:

  • For a 2-year window, stocks have ~75% chance of outperforming high-yield savings; 3 years, about 90%. Still, the risk of loss is real.
  • If loss would derail the plan, keep it in savings. If you could delay the property purchase or weather a market dip, investing is an option.
  • “Sometimes we talk about these money choices as if it's all or none, save or invest. And the truth is you can split the baby here, you can do some of both…” [48:08]

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Notable Quotes & Moments

• Financial Planning as Community Support:

  • “Given the circumstances, not only did it feel frugal, but it just felt very community whole. It felt healthy.” –Matt, on asking neighbor doctor for help [06:09]

• On Credit Card Optimization:

  • “You're not a bad person if you are carrying a balance and you're paying interest. That's just the reality for some folks…” –Matt [16:09]

• HSAs & Record Keeping:

  • “Take a picture of every health care bill you receive so that you have a record of it. You want to, like, digitize those bills so that you can go back and rummage through them if you need to.” –Joel [22:27]

• Vesting Period Frustration:

  • “It was like this mirage. Right, of a match that you were getting for investing retirement that doesn't actually accrue to you.” –Joel [30:25]

• Simple Investing for All:

  • “Oftentimes I think the more complex that folks make it, the more individuals tend to tune out… But the cool thing is that the simple choice is often the most ideal one as well.” –Matt [43:16, 43:26]

• Medium-Term Investing Conundrum:

  • “If the market is down, are you willing to wait longer for a recovery? … If that would be a huge, a huge insurmountable problem for you...then I don’t think you can be investing the money.” –Joel [46:11]

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Timestamps of Important Segments

• [08:31] – Credit card 0% APR optimization and psychological considerations
• [18:57] – HSA receipt management and maximizing tax-free growth
• [26:47] – PMI: how and when to remove it, with math on savings and appraisals
• [28:29] – Employer retirement plan vesting periods and account rollovers
• [39:01] – Roth IRA basics: how much to invest, how often, and into what funds
• [44:59] – Medium-term investment decisions (2–3 year window), mixing safety and growth

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Final Thoughts & Tone

Throughout the episode, Joel and Matt blend friendly banter, honesty about their own financial quirks, and practical advice. They emphasize understanding your personal risk tolerance, balancing optimization with psychological comfort, and keeping financial decisions both efficient and emotionally sustainable. The core message: simple, consistent habits and deep self-awareness drive wealth much more reliably than complex tricks or short-term chasing.

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Bonus: Beer Breaks

In classic "How to Money" style, the co-hosts sample “Twin Sour” by Living Waters Brewing Co.—discussing subtleties of vanilla, cranberry, and marshmallow in craft beer. Lighthearted but fitting for their show’s relaxed and approachable tone.

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Summary for New Listeners

If you haven’t listened: This episode is a master class in the day-to-day decision-making of personal finance. You’ll find concrete tips on everything from optimizing credit card offers to handling the gray zone between saving and investing for medium-term goals, all in a tone that never feels preachy or distant. The hosts model how to make money choices confidently, consciously, and with enough humility to ask your neighbor for help—or at least share a beer with them afterward.

Transcript

[A]

This is an iHeart podcast.

[B]

Welcome to how to Money. I'm Joel. I am Matt, and today we're answering your listener questions.

[A]

Yeah, there's nothing wrong with my voice. I know everybody was worri like, oh, Matt's sick. He sounds hoarse. No, not the case.

[B]

Just sick in the head.

[A]

Hey, don't disparage me. Here on the podcast we've got listener questions. Thank you.

[B]

Wait till the end to do it at least.

[A]

Yeah, don't do it. While we're actually recording, Joel, we are going to hear from a listener who has a medium term investing conundrum. I feel like this is, this is a classic, but it does have a slight twist, so we'll get to that one. Another listener, she is considered. She's kind of considering some naughty credit card behavior.

[B]

Joel.

[A]

Something that she's never done before. And 50 Shades of Great credit card. Not quite. See who's got the stick in the head going on for him right now?

[B]

That's me.

[A]

That would be Joel.

[B]

Never seen the movie, Never read the book.

[A]

Listeners considering some of the different vesting periods from their with their employer sponsored retirement plan. We'll get to that plus more during our episode today. But first, buddy, I wanted to ask you a quick little question. I had a little money saving win recently and I'm actually hesitant to share it on the podcast. I think I'm gonna get blowback from listening.

[B]

Sometimes your. Your attempts to save money border on asinine.

[A]

And so, yeah, people are unethical perhaps.

[B]

Well, not usually unethical, but usually like, whoa, man, that was like pretty cheap and frugal.

[A]

Pushing the envelope a little too far. No. Okay, so here's the story. My. One of our, one of my daughters, she takes, she does gymnastics and she was doing some sort of maneuver. She was, I think she was doing like a back bridge kickovers, I don't know, something. And her elbow popped during gymnastics. Like, evidently the coaches heard it and she went down like she crumpled. And she's super tough. You know which daughter I'm talking about. She, like, when it comes to physical stuff, like, she's tougher than me, dude. She's like easily the toughest kid. I think she's tougher than Kate and I as well. But she was crying. That's when Kate knew that it was serious because she, she hardly ever cries about, you know, something like that. The folks at the gym said, hey, go to the, the specialty children's hospital, which we've done before. And in that case. And it costs a lot of money though. Right. Because this is a. It's on the other side of town. So not only is it going to cost a lot of money to go do this, it's going to cost a lot of time. But of course, when you've got a hurt child, you're thinking, this is what we've got to do.

[B]

Sure.

[A]

They were insisting that we go and do that to make sure she's okay.

[B]

But by the way, you say this, too. It cost of money because neither you or I have traditional health insurance.

[A]

Exactly.

[B]

Whereas it would just be a copay.

[A]

Typically, no copay here, man. If we make an ER visit, we're paying.

[B]

So we've done four figures in all likelihood. Almost.

[A]

Almost. Not quite. But we've actually done a similar visit before. And all we did was leave there with a lollipop and them saying that, oh, no, she's going to be okay. And so one of the considerations that was the fact that this daughter heard her elbow pop again, like, right when it happened. And so I'm thinking, I think she dislocated her elbow, and I think it went back in place almost immediately. But it's certainly why it hurts. But is it worth actually going through and going to the hospital? And this is where my brain, you know, as we started thinking creatively here, which is that we've got a neighbor who is a doctor, and he's told us before multiple times, hey, if anything ever comes up, you know, bring the kids up here. And I'm happy to take a look at them. So we finally took him up on his offer, and he was happy to see her, let her in was incredible. Let me talk about. I mean, just his, like, his bedside manner. What? He wasn't out of bed. We're just standing there in his house, and he's just asking her amazing questions, asking her what hurts, what doesn't hurt. And after five, 10 minutes, he just says, I think. I think you're exactly right. I think she dislocated her elbow. No need to go in. Let's keep an eye on it. She needs to use it. Don't isolate it, but do be careful. Blah, blah, blah. You know, maybe don't go quite as hard on the playground tomorrow throwing fastballs. Yeah. And it turns out he was right. Like, the next day, she was feeling better. The day after that, her elbow was in better shape. But it's in that moment when they're hurt that you have to make the call. And that's what's so difficult. And I think a lot of times that's where folks err on the side of better safe than sorry. And so in this case, do you think that we were being frugal or cheap to not go to the actual hospital?

[B]

If you had had health insurance, my guess is you would have gone just as a preliminary caution. The stakes would have been lower.

[A]

There's also the cost of time. Like, it would have taken hours and hours out of our evening.

[B]

Get it? Because, like, this is. This is something that we run into frequently. Also, this is the painful side of not having traditional health coverage. I mean, the painful side of having traditional health coverage when you're self employed is how expensive the premiums are. Like thousands of dollars a month for a family of five, or in your case, six. And so we want to avoid that because it's just prohibitively expensive. And as many more people around the country are finding out. Right. Right now this year. But I guess I think you still took her to see a medical professional. It's nice to have like a doctor in your neighborhood who says, bring her on by whenever. And I think not everyone has that. Right. But if you do.

[A]

Sure, sure.

[B]

Like, yeah, I don't know. I think I would have felt comfortable doing this.

[A]

You would have been for. Yeah, so I guess I was.

[B]

It's not like you were just like, hey, suck it up. Bite on this leather belt.

[A]

Yeah, pop it back in myself, because I YouTubed it.

[B]

Right. That would be. I think I would be different. That would probably be cheap.

[A]

I think it also would have been cheap is if he had said that we could do something like that. Right. But the fact is, and we've had neighbors even say, hey, no, you need to. You need to go see Dr. Joe. He's great. He'll totally just like, take a look at your kid and make sure that they're okay.

[B]

I think that should probably get him a nice bottle of whiskey.

[A]

That's the. We. We totally did. And I mean, we're. Yeah, we're pretty good friends with him and his wife. But I do think it would have been different too, because that. That's the cheapness that would have felt like imposing. Imposing your cheapness on somebody else. I think that's when it would have felt like, oh, feels like less of a frugal move. Feels a little bit more like a cheat move if you were to do that. But given the circumstances, not only did it feel frugal, but it just felt very community whole. It felt healthy.

[B]

A House on the prairie. Yeah.

[A]

Or like, what's the Mayberry? You know, like, it just. It Just felt a little bit more like stepping into the past.

[B]

We just professionalized and over professionalized in some ways. Everything. And this is a way to. Yeah. Lean into if. I bet if he had a question about his Roth IRA or something like that, you wouldn't be like, whoa, whoa.

[A]

Buddy, let's do it.

[B]

Dr. Joe, leave me alone. Listen to my podcast instead. Like, I don't think you would have pulled that on him. And it sounds like he feels the same way about serving the people in his neighborhood, which I think is awesome. Yeah.

[A]

And if I haven't let him know that I need to. Hey, let's talk about finances. I also think he's doing all right.

[B]

Yeah. Okay, let's. Matt, let's mention the beer we're having on this episode. This one's called Sour Twin. It's by Living Waters Brewing Company. I think it's called Sour Twin.

[A]

I don't know.

[B]

The label's kind of Sour Twin. Yeah.

[A]

Or Twin Sour.

[B]

Something like that.

[A]

Go beyond usual. That must be their tagline.

[B]

It looks good. We'll give our thoughts on this one later on. By the way, if you have a money question, we'd love to hear from you. You're not. You don't live in our neighborhood. You can't walk up to our front door and ask. If you do and you're listening, you can. Matt's available. He'll answer your question anytime, day or night.

[A]

You know what I just thought of? So with some neighbors that had told us, like, no, no, no, you need to go talk to Dr. Joe. He gave me a beer. You know Jimmy? Yeah, he's a friend. He's a friend of yours, too. He gave me a beer, and I am now thinking, because we will talk about money and stuff. He always jokes about it. I'm wondering if he wanted us to have that beer on the show.

[B]

Oh, well, bring it in.

[A]

Well, I drink it. I drink it.

[B]

You screwed it up.

[A]

I just. Yeah, I'll need. I'll repurchase that beer and we'll share it here on the show.

[B]

That sounds good. But if you have a money question, you can't knock on Matt's door, but you can quickly record your money question on the voice memo app of your phone. Email it over to [e-mail] It'll take you all 45 seconds, and hopefully we can take it on the show next week. Matt, let's get to questions, and let's start with one about credit cards and trying to maybe optimize your credit card Decisions.

[C]

Hi Matt and Joel, this is Suzanne from Austin. I recently acquired a Chase Inc. Business cash card. It has a generous $900 sign up bonus which only requires spending $6,000 in three months. I will have no problem hitting that number without making any purchases that I wasn't already planning to make. Here's my the card offers 0% introductory APR for the first year and I'm considering only paying the minimum balance until it's closer to the 12 month mark. I figure I can earn about $200 by keeping that money in a high yield savings account. I've hit all the money gears and am very financially responsible and have no reason to think that I would spend that earmarked money or forget that the bill is owed. But I haven't carried a balance on a credit card in more than 30 years so it feels very strange to me to consider this. I hate debt, but I feel like not taking advantage of this offer is just leaving money on the table. So what do you think? Is this a smart money move or is there a downside to this strategy and is my greed luring me into making a foolish decision? Thanks a bunch.

[A]

Suzanne. I love how you are thinking about this question and first off the fact that you're Talking about snagging 900 bucks for free without adjusting your spending, I think that is, that is a pretty sweet welcome offer.

[B]

She did say I only have to spend $6,000 in three months. And I was like for a lot of people that's for a lot of that's more than what they would spend on their credit card.

[A]

That is true. This is a business card though. So she's got business expenses going there I assume and they can be really attractive especially on some of those business cards.

[B]

People who listening might be saying 900 bucks. Like I haven't seen sign up bonuses like that. Where is she getting this? What is this? And you're right, business cards often have the most lucrative terms, typically have to spend more because your businesses do spend more and that's why they they these credit card companies want businesses to sign up for their plastic but that's why they offer better signup bonuses typically too.

[A]

Heck yeah. And Suzanne, she's trying to take full advantage of this offer and given how you handle your money, I am not worried that you're going to screw this up. First of all, you're in money gear. 7. You said you haven't had a credit card balance in like 30 years or something like that. So it sounds like you are being incredibly responsible. You're being very thoughtful. And honestly, this is why personal finance is so personal. Because there are a lot of other folks who might ask the same question. And I would just say, no, no, no, you go ahead and take care of that balance. Like, let's not even mess. Just take the 900 bucks, right? Like, don't even worry about optimizing even more.

[B]

On top of that, you're overthinking it. Go ahead.

[A]

Yeah, yeah. Because the stakes are going to be too high if you screw this up and they're going to. Those folks would find themselves in a situation where they don't have the cash on hand, right? Like, it hasn't been earmarked or they spent it accidentally, perhaps. And then they would be forced to pay exorbitant interest rates for a while. It could be because even of a job loss or maybe even like of an overestimation of their ability to pay on it when the time finally came. Either way, for some folks, I would say, no, thank you. But I don't know, man. The way Suzanne's talking about it, I think she's solid. I think she's got a good game plan here. And I say go for it.

[B]

She gave us enough of a window into how she thinks about money.

[A]

Nice little snapshot.

[B]

And her longtime dedication to handling her finances effectively. Her aversion to debt. Like, I feel like I got a really good. In just a pretty short voice memo, a pretty good peek into what's going on in her financial life. And so I agree with you, Matt. I think she is, of course, the kind of person who can do what she's asking. She can take advantage and optimize, make a couple extra hundred bucks on this arbitrage move and do just fine. But not everybody could. It's also true, by the way, that for some crummier financial products, retroactive interest can be charged. Like, if you screw it up, the stakes can be even higher, like on some store credit cards. And Matt, you remember those interest until 2035 commercials that you'd see for like, local furniture retailers or I guess national furniture retailers? Well, those are often similar products, too. People get really excited about not paying interest at all on that new couch. And then they realize when they don't pay it off before the agreed upon date, there's all this retroactive interest that gets charged. And the price of that chair just went. It just doubled overnight, which is. That's what they're banking on, like, oh, interest free. Not really, though, for like, half the people who buy this thing.

[A]

Yeah. It's there in the fine print that you didn't read.

[B]

That's exactly right. That's exactly right. But of course, Suzanne, because you're so buttoned up, you've earned a much longer leash. Like, you can make decisions like this because you've given yourself that ability. Remember, though, the day the intro period ends, interest kicks in. Probably not retroactive interest like with some of those furniture plans, but we would just say pay the full balance. We. Before that promo expires. That's the key here. I'd set up a calendar reminder or just go ahead and input the auto payment now on the website for a future date, like a week or two before that promo expiration date expires. Just because, I don't know, I'm. I can be a little anal. I want to make sure I'm not running afoul of that and paying interest.

[A]

She's. She's talking about this from, like, a facts and numbers and figures standpoint. So it feels like she is fairly comfortable with the. With, like, the numbers side of things. But I think maybe there's sort of like, the mental point of view that we should.

[B]

Should.

[A]

I think there's like, a psychological or an emotional element to it as well. So basically, the fact that she even asked the question makes me think that this might be weighing on her mentally a little bit. And to that extent, I will say, like, 200 bucks. Yes. It's nice to keep in your pocket, you know, but is it worth having this on, like, in the back of your mind for the next year or so, just for 200 bucks? Right. It, like $200. That is, like, real money. Right. I'm not. I don't want to at all dismiss that. And for a lot of folks, they might be more than willing to jump through the hoops. And Suzanne, again, she's in money. You're number seven. She's got a killer net worth. And in her case, it may not be. It just may not be worth it at all if there's a drop of stress that is entering into her life because of this. Right. But on the other hand, maybe. I don't know, maybe Suzanne's a killer. Maybe she's like a soldier. She's got, like, a very, very much like a general mindset, and she.

[B]

Tactical. Yes. Yeah. Yeah.

[A]

She's. If she can very much divide and separate her emotions from, like, the actions. The actions that she is taking. I think I do tend to lean more in that way just based on how she's. How she's talking about it. So I don't know.

[B]

But you always have to weigh the reward verse, the risk and the trade off that you have to give. And if it's going to be buried in the back of your head and you're going to like, wake up in cold sweats and have those nightmares like, I didn't pay off the palace in time.

[A]

Yeah.

[B]

Like, if that's. What if that emotion is like playing out and working its way into your everyday life, don't sweat it. Pay it off.

[A]

So like you said, if you set the reminder, though, and you know that if you pay it off before it comes due, that you're gonna be totally fine, then I wonder if some of it. Because she said a word that stood out to me. She said something about it feeling strange.

[B]

Yeah.

[A]

To carry a balance.

[B]

Yeah.

[A]

So I think there's like a. I've.

[B]

Never done this before.

[A]

Exactly. Yeah. Like, it makes me think that she might be. Be tempted into thinking that there is some sort of moral failing by carrying a balance. And what I want to say is that there is no failure on your part. Like, you are not a bad person. You're not a bad person if you are carrying a balance and you're paying interest. That's just the reality for some folks and that's the financial situation that you're finders find yourself in. But for you, Suzanne, not only are you carrying a balance, which is fine, but you're also not paying interest on.

[B]

It for a year.

[A]

So maybe it's more just mentally accepting the fact that, oh, this is something I've never done before, but it's totally fine.

[B]

Yeah.

[A]

Then not only is it fine, I'm gonna be able to pocket the difference. Make an extra 200 bucks.

[B]

Agreed. I love that you pointed out the emotion, though, because sometimes emotions aren't rational and sometimes, like, there's something going on in the back of our brain that's hard to address. And I think you're right to talk about how you can possibly address that. So you get over it, but also realize that if it is hamstringing you, then it's just not worth 200 bucks. Right. And Suzanne doesn't sound greedy. Right. Like she's. She mentioned that. Am I being greedy? Like, no, I don't think so at all. You're really just trying to play by the complex rules of personal finance and credit card company incentives. And I too like to squeeze as much juice out of a 0% intro offer. Or at least I used to. I'm just like, less keen on playing the credit card game in general these days. And I don't know what that says about me. Maybe we should delve into that more at a future date. But, you know, they offer those incentives for a reason. They want to get people hooked on their particular credit card. And the truth is, a decent chunk of the American public does, and they suffer the consequences. Right. They'd really like it, Suzanne, if you weren't able to pay your full balance much of the time. They like being able to charge 22% interest rates. That's not going to be you, though. You're not going to fall into that trap, that something 50 to 60% of Americans fall into. But I really think the crux of this question is how much do you value 200 bucks versus the impact on your mental capacity. And if you're like, oh, it's not going to bother me now that we've talked it through, great, like, save that 200 bucks and just make sure you pay off the balance in time.

[A]

Go for it.

[B]

Yeah.

[A]

I will say the only potential downside is credit utilization. Because if she's carrying that balance, that's true, $6,000 is a good amount of money. And so if you're looking at staying below at least that 30% utilization threshold, that means this car needs to have a limit of like at least $18,000.

[B]

Yeah.

[A]

Which is pretty, that's pretty high up there. But again, maybe that doesn't matter to her because if she's pretty far along, maybe she's, she's not a first time homebuyer and she's not getting ready to apply for a mortgage on her first home. But if you are looking at getting a new debt product, Suzanne, keep that in mind as well, that your credit score might be slightly negatively dinged by carrying a balance.

[B]

And if you're like, I got an 800 credit score, Matt, I might go down to 790. Then it's like, big whoop, not that big a deal.

[A]

Take the 200 bucks.

[B]

Right. Which for somebody like Suzanne, that's probably where she's at. Right?

[D]

Yeah.

[A]

Yep.

[B]

All right, we've got more money questions to get to, including HSAs, using those effectively. And also talk about the timing of investing. How do you know when you should be an investor or a saver? We'll get to that and more right after this.

[A]

All right, man, we are back from the break. We've got a question here from a listener because he's got a. This is a two for one bagger, which includes a question about pmi.

[B]

Let's hear it. Hi.

[E]

Howdy, money. My name is Jeremy Miller. I live in Rochester, New York area. I have two questions. First question is, I have a HSA account for my employer. My employer puts set money every July, and I use it. I heard that has tax benefits. Are you supposed to keep your receipts or how does those work? My other question is, I think I have a conventional mortgage on my house and I didn't do 20% down, so I have a PMI. Would it be a good idea or prudent to cancel it because I own my house for more than five years? I think I like the sell.

[B]

See ya, Joel.

[A]

I will say Jeremy actually launched into some brewery recommendations that we kind of edited out for sake of length for the show. And he mentioned Mortalis, which is a really great brewery. That's one we've had. We've had a Mortalis beer on the show before.

[B]

I think the Mortalis beers that I've had, I remember being great. I also. I don't think I've ever bought beers that were more expensive per ounce.

[A]

It's like the most expensive beers in the United States.

[B]

Four packs are like $38 or something. It's insane. They're good, but I just don't know that they're like twice as good. Are they that good as the equivalent? Yeah.

[A]

Well, if you're just looking for the best, like Jeremy is.

[B]

Well, when you're a high roller like Jeremy, you gotta have a craft beer equivalent. I know, I know that's true. And Jeremy's looking to do everything right. Drink the right craft beers, make the right moves with his HSA. Let's talk about HSAs for a second, Matt. It's a brilliant vehicle to avoid tax, and it is underutilized. Like, not enough people know how good, how epic the HSA can be if they use it to its full abilities. And if you funnel money that you plan to use on healthcare through your hsa, your health savings account, you can avoid both federal and state tax, which is lovely. Depending on what your tax rates are and which state you live in, that could be meaningful savings. Right. And then HSA contribution limits went up for everyone next year. So make sure sure you look that up. Know what you can stick in there? Something like 4400 for individuals, 8800 for married couples. Don't quote me on that. But it's somewhere right in that vicinity. And you know, as open enrollment is coming up for everyone, Just don't forget about your hsa, because it can be this great way to save on taxes in the given year, but it can even go beyond that, too. Yeah.

[A]

And the fact that Jeremy is asking about saving the receipts means that he is planning to use his hsa, his health savings account, in the way that we recommend, which is not using the money that you stick in for current year's health care expenses in order to invest that money and to grow up that nest egg. So this is the perfect account for that, because there is no other account where you can avoid taxes completely. The money goes in tax free, it grows tax free, you pull it out tax free. And not only that, you get to avoid FICA payroll tax as well.

[B]

Yeah. If you're contributing Right. Directly through your paycheck to deduction. Yeah. It's like. It's like quadruple tax advantage.

[A]

Quadruple tax advantage, which you can't beat. And that being said, though, keeping some records is incredibly important, which is what he's actually asking about.

[B]

Right, Agreed. Yeah. That is one of those things where you got to kind of jump through the hoops. If you want to use the HSA to its maximum potential, the best thing to do is to take a picture of every health care bill you receive so that you have a record of it. You want to, like, digitize those bills so that you can go back and rummage through them if you. If you need to. But also, when you're taking that picture, name the file and create like a folder, but name the file in a way that makes it easily searchable and sortable. So, for instance, when you take a picture of a bill that you. A prescription, let's say, cost you $28, include the date, the amount, and where it's from, like, pharmacy down the street, blah, blah, blah, whatever it is. You could even start a simple spreadsheet too. But honestly, just organizing your photos in that manner might be enough where you don't need to duplicate into a spreadsheet on top of that. See, I would.

[A]

I would even. I like the idea of doing the opposite.

[B]

I like the like, spreadsheet and not.

[A]

I would still organize my.

[B]

The pictures of the receipts.

[A]

Like either certainly by year, if not by month. But giving how relatively rarely we have medical expenses. It would probably just be by the.

[B]

By the year. Mm.

[A]

And then keeping. I just like having a one pager man. Like having a single Google sheet, like you said, with the, you know, whatever.

[B]

The date medical service was or the.

[A]

Item that you purchased to be able to have a running total. Because to me, like, that is the most important thing is to have a running Total as to how much you can withdraw from your HSA without having to pay taxes on that off in the future. And it's not. I guess it's partially for you to know how much you can legally pull out of that account without paying taxes, but it's also. It's mainly for the irs, because if you were to get audited, it's to show them that, oh, no, no, no, I don't need to pay taxes on this because I have the receipts to show that this is. This was for a medical purchase or a medical procedure or service that I am now reimbursing myself for.

[B]

If the IRS comes knocking at your door, Jeremy, you can say, oh, no, look at my record keeping. And yes, I did withdrawal $6,000 from my HSA this year. But look at. I have $15,000 in healthcare expenses over the past decade. I just decided to pull six grand out of it now because I want the rest to keep growing. But I needed that 6K. And that's one of the coolest things about the HSA. It's just so dang flexible. So while you're investing those funds for years and decades to come, you still have the ability to withdraw them anytime right after the. After that healthcare expense has been accrued. So it's a pretty rad account with a ton of, like, not just tax savings, but also flexibility for when you access the money. Yeah, and there are. There are apps, too. I just think it's worth mentioning there are apps that can help you organize your receipts, but a lot of them charge an annual fee. And I think the kind of what Matt and I are describing doesn't cost you anything. It's really not that hard to implement. It's really.

[A]

Yeah, it's not like I think you're.

[B]

Overcomplicating it if you go with a separate app to try to, like, fix this thing.

[A]

I agree, man. I agree. Yeah. I think I have proven to myself how easy it is this year is when I started a spreadsheet for our daughter, for her earnings, for her sporadic babysitting money. And it's. It's just so stinking easy. Like, anytime she. She earns some money, I just keep up with it.

[B]

There takes about 22 seconds.

[A]

It takes no time at all. And a lot of times it's just copying, pasting the previous entry and changing the amounts and updating the date. But then I'm able to just quickly see, oh, this is how much she's earned this year. Which means I know by the end of the year Even if she doesn't choose to, quote, unquote, invest all that money, I can potentially match to get up to that amount if she wanted to invest that within her Roth ira. But it's so simple, I would definitely recommend it. Jeremy also asked about PMI and man part of the reason that we're fans of putting 20% down is because it just allows you to avoid that pmi, that private mortgage insurance altogether. But especially for first time home buyers, I think that might be a really tall order. It can be a tough goal. And so instead trying to get rid of it as quickly as possible. Is a wise move. Is a wise move. It'll automatically fall off once you reach a loan to value ratio of 78%. But even once you've reached 80%, you can request that the lender drop it early. And that's whether maybe you've paid down the balance enough or maybe it's because the home has just risen in value. And I think for most folks it's typically like a combination of both of the two. But either way, trying to get PMI out of your life, it's going to be a big money saver every single month.

[B]

Sure. I don't know what average PMI is on a home. I'm going to guess like 180 bucks a month or something like that. You're talking about two grand a year.

[A]

Depends on the. Yeah, depends on the home. Depends on your credit score when you purchase the home because it can range in percentage, percentage points.

[B]

So if we're talking about two grand a year, I would be willing to do what I do, whatever it took to try to get out of that. If you feel like you qualify at this point because you're. Yeah, one of those combo has been reached, just know that your lender might require an appraisal. If you haven't reached that 78% loan to value ratio just yet, they might make you pay for that appraisal if you're trying to get it waived early before you've actually gotten to that point. But if you're pretty sure that you've reached that point and you'd likely pay off that appraisal cost with the PMI removal in just a few months. So an appraisal might cost 500 bucks, 550 bucks or something like that, if that's three months worth of PMI and you're pretty sure that you've hit that point in the loan payoff process, then it's totally worth paying for the appraisal to get that PMI knocked off. If you've been in the house for five years, odds are that you've reached that point. But it depends, yeah, again, on how much you put down, whether you've been paying extra and what's been happening in your specific housing market. But if you're pretty confident you feel good about that, I think it's, it's, it's worth barking up that tree, asking your lender and getting that appraisal ordered so you can hopefully get rid of PMI in the very near future.

[A]

That's right, Jeremy. We hope that helps. And if we ever find ourselves around the most expensive brewery in the country, we'll hit you up and try out the bat signal. Mortalis. Joel, let's hear from another listener who has multiple retirement accounts and she's trying to make sure she's making the best moves, the smartest moves with those different accounts.

[D]

Hey, Joel and Matt, this is Katie calling from the beautiful Finger Lakes area in New York City State. I just discovered the podcast a few months ago. I've learned a lot so far from you guys. Thanks so much for the fantastic content. Really appreciate what you're doing. So I have a question regarding an old 403B. I recently changed employers and my new employer offers a 403B plan with a match that I'm taking advantage of currently. However, the match comes with a five year vesting period. I likely will not stay with this employer for that entire five year period. So my questions are one, do you think that rolling over my old 403 into a Roth IRA is the best thing I can do with these funds? And two, considering I will likely not be able to take advantage of my current employer's match, should I consider putting a higher percentage of my income toward another type of retirement investment? Thanks a lot for your help, Matt.

[B]

I looked up some pictures of the Finger Lakes region and didn't realize there were so many beautiful looking waterfalls up there. It looks like a place to go in the fall. Like we should go when the leaves are changing someday.

[A]

Is that also near Mortalis?

[B]

Oh, I don't know. That's a good question.

[A]

I think so.

[B]

Is it? Okay. All right, we'll hit up all the above.

[A]

I think that's called upstate. Upstate New York.

[B]

It is, yeah.

[A]

Okay.

[B]

Yeah. So Katie, we'll let you know if we make it up. Everyone knows.

[A]

We'll just let everybody know.

[B]

We'll have an event at Mortalis. I love that you check to see what the vesting period, by the way, from your employer. Not enough People do this, Matt. This is a skip, a step that people skip. They just kind of start contributing to their workplace retirement account before looking into the details. And some employers are less ornery about this. And we'll have like a one year investing period. But the five year, that's, that's like, that's on the long end. That's the longest I know of.

[A]

Yeah.

[B]

And so it's not three's typical.

[A]

Five is like. Yeah, that's a long time.

[B]

Feels like a little bit of a gut punch. It's about as long as it gets. Sorry about that, Katie. To everyone else out there, though, the matching vesting period and then your likelihood of staying with an employer, it should impact where, like which accounts you opt to save for retirement inside of. Because if you don't actually receive the match because you're not there long enough, it was like this mirage. Right, of a match that you were getting for investing retirement that doesn't actually accrue to you. Yeah, yeah.

[A]

She's in this wasteland where all the teachers are. Because they're not that teaching is. I'm assuming she's a teacher because it's a, it's a 403B, of course. But teachers often are. Even though it's very fulfilling work, they're often not financially compensated, probably what they should be.

[B]

So she could be a nurse. Like there's all sorts of potential.

[A]

It needs to be a 501C.3.

[B]

Yes.

[A]

But yes, it's a mirage of financial, of like a financial payout. And then she gets closer to it and then all of a sudden, yeah, it's gone.

[B]

But at least she realizes that on the front end so she can change her habits accordingly. Some people don't realize that. They're like, I leave after three years and they don't realize I've been sucking money in. But that match doesn't stick around.

[A]

They don't get those additional employer dollars. Yeah, the way it works, the vesting works like your dollars. You get to take those, of course, but the dollars that your employer was pumping in, you don't get to keep those. That's how it works. But let's start with the second part of your question first, which is where should you invest given the reality that you likely won't reap those matching dollars? Well, our money gears are in favor of snagging the match, of course, before you invest in a Roth ira. But because it's unlikely that you're going to get the match, given your future plans, I would say go ahead and Prioritize the Roth IRA first. Totally make sure to max that thing out. And actually, since you are not with somebody, get your match, you can have your cake and eat it too. Katie, head over to Robinhood because Robinhood Gold is one of the few non work provided or sponsored IRAs that allow you to invest over there and get a match. So that's like a. It's gonna cost you some money. You have to pay for their membership. But we're Talking about a 3% match on your IRA contributions and it costs, I want to say, 50 bucks for an annual membership there.

[B]

I think that's right.

[A]

Or so it's $5 monthly.50 if you pay all at once if you pay annually.

[B]

So we haven't really talked about that.

[A]

It's been a minute since we. Yeah, it's been a minute since we've talked about that. I was really excited for it when it first came out.

[B]

Read the fine.

[A]

Because speaking of matching, that's another. Okay, so you have to keep it.

[B]

For, oh gosh, I want to say five years.

[A]

The money. Okay, so the money has to stay there in the count for five years, but you only need to actually pay for Robinhood Gold for one year. Okay, so you keep it for one year after you make those contributions. That's sort of like one little hurdle. And this. And the second hurdle is keeping those dollars there within that account for five years in order to maintain that. So that's the IRA. But after that, start sticking money into your 403B at work. I would say up to the match level, especially if it's with one of our favorite low cost companies like Fidelity, which manages a ton of 403B accounts, by the way, because, hey, the reason you would want to do this is you might end up sticking around and getting that match after all. And so you're saying that you don't think that you're going to be there, but a lot of life can happen in five years. There could be all sorts of reasons that cause you to stay where you are.

[B]

And then if you did stay, you might regret not having put any money in the 403B because you're like, dang.

[A]

It, I would have got, guess what you can't do. Go back in time.

[B]

You can't.

[A]

Can contribute.

[B]

Exactly.

[A]

Just something to keep in mind.

[B]

She didn't say, I know, I'm not going to be there. She said, it's not likely.

[A]

Yes.

[B]

And so if that's the case. Yeah. Prioritize the Roth IRA first. But hopefully you can put some money into the 403B. And if you do end up staying there, boom shakalaka. You also get access to some of those matching dollars. That was my NBA Jam, NBA Jam style. Gosh, that was a good one.

[A]

It's been so long since I've played.

[B]

I played that a lot back in the day. Katie, if you've got money above and beyond Roth max contribution limits, go back to the 403. And then after that, I would say you could stick more in a taxable brokerage account. That would give you more flexibility over when you use those dollars. But you're not going to get as nice of a tax break as sticking it in the 403, where you're going to get a tax deduction this year. What do you do with your old 403? That was your next question. And it depends. You. You offered one suggestion, but I would consider leaving it put. If it's with a low cost company like Fidelity. Right. Like, if not, and your current one is with a low cost option like Fidelity, you could roll your old 403B into your current 403B. Most employer plans accept those rollovers. So that would be probably what I'd look into if I were you. If your current 403B is better from your old one from a cost perspective, doing that just kind of consolidates and simplifies things. So that probably be where my head was at.

[A]

You can have multiple accounts. It's just a matter of staying organized. And it kind of comes down to personal preference, I guess. Like, I've got multiple, I've got IRAs scattered across lots of different brokerages. Like IRAs. Different brokerages. And you just got to stay organized.

[B]

You're like a player from an IRA perspective.

[A]

We have a show here. We got to talk about the pros and cons of each one. Make sure that, you know, they got similar offerings. You just have to stay organized, make sure your addresses, beneficiaries are staying up to date on all those different accounts because that's something you don't want to.

[B]

Don't get me started on that right now.

[A]

Oh, yeah, maybe we'll save it for another show.

[B]

Yeah. Okay.

[A]

One slight silver lining of having multiple accounts is the fact, Katie, like, after you've done this for maybe a couple decades and like, you could have some, like a serious nest egg saved up, and there is a slight risk that you're able to mitigate by having multiple these accounts with multiple brokerages. Because of the SIPC insurance, it's limited at $500,000. And so you might be thinking, yeah, okay, that's a ton of money. It's going to take me forever to get. I'm just saying there's a slight chance that were something awful to happen with some of these different brokerages due to fraud or something like that. Security stocks that you have that you're invested in are only backed up to $500,000. So just a small little thing and I even hesitate even bringing this up. So yeah, let's just move on. It's a small, small thing.

[B]

Probably the bigger thing is what are the costs at that is easily the fund cost of the brokers that you're doing business with. And if you're like, well, one of them's like with an insurance company and the costs are like kind of high and then the other one is with one of the low cost good guys that Matt and Joel talk about, Vanguard. That's, that's who I'd want to be with then. Right. So just, I would probably let that be the tail of the wags. The dog here is the cost and then try to put everything into that. And then Katie also mentioned, by the way, direct rollover is the way to go. So you're not creating a tax problem for yourself. You also asked about rolling over your 403 into a Roth IRA and I love the idea, right. If your 403B is a Roth, 403B turning into a Roth IRA can make a lot of sense. If not, though, you don't tax, because you wouldn't just be talking about a rollover, you'd be talking about a conversion from a traditional to a Roth. And there's a lot to consider before you make a move like that, like your current income, your likely future income. Because if your future income is going to be lower in a few years, then you might want to do it in a year where your income's down the amount of money in your 403. If we're talking about 200 grand, then you could create a serious tax problem. If you're talking about five grand, then the tax implications are minimal. Run the math on the tax that you'd owe before turning traditional $403 into Roth IRA dollars. If you think it makes sense after doing that, make sure that you have the cash on hand to pay the higher tax bill. On the bright side, you'd never owe tax on those dollars again, which is kind of fun. But it also might not be the most optimized choice because you're usually looking probably for like non Working years. Even in that recent conversation I had with Cody Garrett in those early 60s is often the time where you want to be rolling over some of those funds. You just kind of want to find the strategic time to reduce your overall tax burden.

[A]

That's right. And of course she could roll over like a quote unquote traditional 403 to a regular IRA or a traditional IRA, but then there's not much benefit there, assuming she's with a low cost provider. It's basically kind of the same thing. So something to consider. But Joel, we've still got that medium term investing question to get to, whether or not this individual should invest those dollars. We'll get to that and more right after this.

[B]

Alright, we're back. Let's get some more money questions. This one comes, it's a Facebook question of the week, comes from Jessica. She says, explain it like I'm a child. I have a Fidelity Roth IRA account. How much of it should I invest? And into how many different funds or stocks should I split it? Lastly, how often do I need to be doing this? Do I just add new deposits into the same investments or do I constantly buy new ones? Help. Matt, you're good at explaining things to children.

[A]

I think I tend to over explain things to my children.

[B]

First of all, they're like, dad, we get it.

[A]

Jessica, I want to just highlight here that it sounds like you're doing great. You've opted to invest via Fidelity, which is a brilliant move. I think that's going to pay off handsomely for years to come, for decades to come, thanks to their incredibly low costs. But onto the specifics, you should invest all of the money. If those dollars have been funneled into your Roth ira, I hope that means that you've got no need for it in the coming years or even in the coming decades and that you've got savings on hand for some of those needs, some of those medium term savings goals. And so because of that, there is no reason to leave any of those dollars, let's say in a money market account or automatic sweep fund or something like that, or to try and slowly get it into the market. Instead, I would say to invest the whole sum immediately. It makes me think about, I was trying to think of like an analogy and I guess given the fact the other listener was talking about being in the desert or the mirage or whatever with the vesting, it makes me think about water. It's sort of like, okay, the dollars that you've put into your Roth ira, that's like filling your nalgene bottle with water or your. What's it, Owalla. Those are the new bottles, which have killer colors, by the way.

[B]

I still go with my old school Nalgene.

[A]

So those are putting the water into your bottle, into your water bottle. That's like putting your dollars into your Roth ira. But then what do you do with that water? Well, you need to actually drink the water in order to receive the hydration, the benefits of staying hydrated.

[B]

Otherwise you can still die of heat exposure right now in the desert.

[A]

And so in a similar way, if those dollars are just sitting there in your Roth IRA and you haven't actually not ingest the water, but we're talking about investing funds.

[B]

Here we go.

[A]

It's working.

[B]

I see it.

[A]

You actually have to deploy those dollars and put them to use. Does that help to explain it to Katie's.

[B]

I think so, yeah.

[A]

Or Jessica as a child here.

[B]

And this is a position that that many a novice investor had found themselves in. They hear Roth IRA and they hear low cost and they open up the account and they stick the money in. But they don't take the all important step of investing those dollars. They come back years, years, years later and they're like, this should have grown. I've seen the market ripping, right?

[A]

That's supposed to be what happens when you put money in a Roth ira.

[B]

Those are some of the saddest stories to me is the people who did all the right moves, except for the one move, the last move, the last.

[A]

Bit where you actually drink the water, where you actually invest those dollars.

[B]

That's because you want your money working for you. If we look at history, the sooner you get the money invested, the better. But then you asked about how many funds or stocks should you pick? I guess my answer would be probably not many. That is a sign. I think that question comes from a place where Wall street has overcomplicated things for a whole lot of individuals. They made it seem like you have to do more than you actually do in order to be a successful investor. So much depends on your age, Jessica, how long you plan to not touch your investments. We love like Total Stock Market and S&P 500 funds because they're pretty diversified and they're really cheap. But both of those are for folks in the wealth building phase of their lives. So if you're in that phase where you have many, many, many years to allow those investments to grow, they can be a great one stop shop. And it's just a super simple choice to make that purchase inside of your Roth ira. If you're getting closer to needing the money or you prefer to take a less stock heavy approach, target date funds can be a solid choice, too. Those are. That's typically the realm that we stick to when we're offering our thoughts, at least on what you should invest in. But so much of it comes down to your goals, your risk tolerance, your timeline. But I just think having like a slew of funds just over complicates things for the average DIY investor.

[A]

Yeah, oftentimes I think the more complex that folks make it, the more individuals tend to tune out. Which is why I want to try to keep this explanation to a minimum, because that's when my kids start.

[B]

Well, that's what she asked for.

[A]

Tuning out.

[B]

Yes.

[A]

Yeah. But the cool thing is that the simple choice is often the most ideal one as well. But from a frequency standpoint, you should probably be sticking money into that Roth IRA on an annual or a monthly basis. Annual, if you've got the full contribution on hand. If you've got that full to the limits amount available on January 1st, take.

[B]

It to the limit, as the eagle said.

[A]

Otherwise, as you acquire those dollars and you have that money on hand, just setting up a recurring contribution every single month, that is a great way to go. And then, yes, immediately invest those contributions every time you make them. Maybe the water analogy can continue, Joel. Throughout the day, it makes a whole lot of sense to sip the water periodically. Although, no, it kind of falls apart there, too, because in money, if you drink it all at the very beginning, that would be the better way of doing it because history shows that markets do tend to go up. And so the longer you are invested, the better. So the analogy does fall apart, actually.

[B]

Well, you.

[A]

Because you can't just fill up your water bottle at the beginning of the day, chug the whole thing, and expect.

[B]

To be set to be hydrated for the rest.

[A]

That's not the optimal result, right?

[B]

That's a good point. Yeah. I mean, the analogy was bound to explode at some point, fall apart at some point. But it did what it was supposed to do. It did enough heavy lifting, and hopefully that helps Jessica figure out how to use her Roth IRA effectively. Jessica, you're on the right. You're on the right path.

[A]

I'll work on it some more. It just needs some polishing.

[B]

You got this analogy. Go back. I bet Chat GPT can help you.

[A]

Like, polish this up.

[B]

Chat Polish up this turd of a.

[A]

I thought you liked it.

[B]

I mean, it's good. Yeah.

[A]

I see your eyes shooting over the side.

[B]

All right, let's get to another question. This one comes from Anonymous who says is it is two to three years enough time to invest? I have around $25,000 in capital in a savings account, getting a three and a half percent return, planning to use that money for a down payment for a rental property in about two to three years. Should I invest it or leave it in the savings account?

[A]

What do you think?

[B]

These are the tough ones.

[A]

What are you going to recommend?

[B]

I mean the reason this is tough is because it's medium term and if we're talking about, hey, if this poster had said I have one year, what do I do? I feel like the answer is pretty obvious. Savings accounts make the most sense.

[A]

Slam dunk.

[B]

If they said I have five plus years, then I think the answer is pretty obvious. And I think it's also those dollars also slam dunk. Two to three years, man. This is where it gets tricky in a way, like, I don't know, I think this is where you have to again like understand your own risk tolerance. Because if the market is down, are you willing to wait longer for a recovery? And because if you've lost some of that capital, it's going to be hard to stomach pulling that out in order to do that real estate deal. If that would be a huge, a huge insurmountable problem for you, if you.

[A]

Could live with that kind of setback.

[B]

Then I don't think you can be investing the money.

[A]

So it's helpful I think to also look at history. So over a random three year period, when you look back at the history of the stock market, you have a roughly 9 in 10 chance of the market outperforming your savings. Over a two year timeline we're talking about, that drops down to 75% chance to outperform. So these are the kind of factors you need to take into account because man, it would be nice to grow that capital so that you have a bigger down payment available for that investment property purchase. But it's not guaranteed. And the fact here too that it's for an investment property. I think my opinion as to what the answer is here hinges on that. Because if it was for a personal residence, I would say don't take the risk, just save up, put it, put it in savings, get the guaranteed interest rate from your bank. But what's the whole point of getting an investment property? Is to grow your net worth. And what is investing in the overall stock market? It's just to grow your net worth. And so on one hand you kind of have like a life goal, lifestyles, it raises more of those kind of questions. And on the other hand, it's just I want to grow my money, I want to be able to grow my wealth so that I have more options off in the future.

[B]

I think that's a good point.

[A]

And with that in mind, it's just like, okay, we'll stick that money in the market in two or three years, let's see how your money's doing. If it does really well, great, you've got more money on hand to then either put towards real estate and you got more money or you can say, man, it was really nice to be able to not have to do anything.

[B]

To sit on my hands and watch my money grow and watch it grow automatically.

[A]

Oh man, it's a Saturday. You know what I don't have to do right now is a go show that empty property to a bunch of folks who are going to be interested in getting story. So it kind of, it comes down to what you're looking for in life. If your goal, let's say though is to maybe outperform the overall market and you're looking, let's say you're looking for income diversification. Okay, well, it sounds like the investment property might be more of a priority. So again it kind of comes down to what your priorities are, what you're looking for your life to look like off in the future.

[B]

I think last thing worth mentioning is sometimes we talk about these money choices as if it's all or none, save or invest. And the truth is you can split the baby here, you can do some of both and you can say I'm going to leave half of it in a savings account, I'm going to put the other half in full on 100% stocks. Or you can even say I'm going to put it in a more risk averse investment choice array of choices. So it doesn't just have to be all in on savings or all in on investing. You can do a little bit of both. And yeah, you're like protecting yourself from a downside risk. You're also limiting your potential upside. But if this buying this rental property in let's say three years time at the max is super important to you and losing much capital or any at all would be a huge downer, then I think maybe splitting the difference here and going halfsies could, could make some sense too.

[A]

Yeah, I like it.

[B]

All right, let's get back to the beer Matt that we had on this episode. This was from Living Waters Brewing Co. It was Twin sour. It was a sour ale brewed with cranberry, marshmallow and vanilla, bro. What did you think?

[A]

I liked it, man. Were you picking up much vanilla? Because the cranberry. Right. Like you got the cranberry tartness going on. I can. I definitely feel that. And even the kind of like the marshmallow smoothness, it kind of like adds some of that depth to it. But vanilla made me almost think that there's going to be some sort of. I don't know, it's going to be more of like a treat, I don't know, creamier. I just wanted. Almost expected it to be creamier.

[B]

Yeah. I feel like I picked up a little bit of that vanilla in the flavor profile. And I got to say, like, I think the cranberries were more muted than I thought they were gonna be, but in the perfect way.

[A]

Yeah.

[B]

And I love this one.

[A]

Yeah, I really liked it too.

[B]

I thought it was incredibly smooth. And it's one of those where typically I thought it wasn't as sweet as I thought it was gonna be, which I was a little worried about with like vanilla and marshmallows and. Yeah. How sweet is this thing gonna be?

[A]

Maybe that's why. Yeah. I didn't notice the vanilla as much, but maybe I see that as like a good thing.

[B]

Yeah. Yeah. So I like this one more than I thought I would. Cause cranberries also aren't my like favorite fruit in a beer, but has a.

[A]

Nice tartness to it.

[B]

Yeah, they rocked.

[A]

It got me. Got me thinking about Thanksgiving coming up a little bit. Cranberry sauce. You know, this reminds me a good bit of Athena, which is a beer by Creature Comforts, one of our favorite local beer. But it's kind of got that kettle sour vibe going on as compared to like a more funky barrel aged sour where there's some of those more terroir natural yeasts and other things that make it funky. Whereas this, it's got tartness from the cranberry, but it doesn't have that funky. Oh, what's going on here? It doesn't have like that sharpness that sometimes you equate with cheese.

[B]

Right.

[A]

Because sometimes with cheese there's like typically funkiness going on.

[B]

The barrel aged sours are more interesting, but this one still had a lot of. Packs a lot of flavor, interesting notes in a beer that was easier to make right than some of those barrel aged ones. So. Yeah, I. I've never had a beer by this brewery.

[A]

Living waters out of Nashville. Yeah, I don't think I have either.

[B]

All right, we'll have to try more of their stuff.

[A]

Yeah. Keep an eye out for them. Also, it's always a plus when the color of the beer is the same color as the label. I really like that because it gives you. It prepares you mentally for what's coming up. What you don't want to see is the label.

[B]

A soft pink hue, right? Yeah. Yeah.

[A]

What you don't want to see is, like, a label that looks one color, and then for you to pour a beer and it's like the complete opposite.

[B]

That's like a black label for an ipa.

[A]

That's startling.

[B]

Or a yellow label for a stout. Like, come on, don't do that.

[A]

Yeah, don't. I don't want to pour no green beers.

[B]

You know, not too green.

[A]

Have you ever had a green beer ever?

[B]

All right, that's gonna do it for this episode. If you have a money question, we would love to hear from you. Just record it, send it over our way. Hopefully, we can take it next week on the show. You know it. We'll put links to some of the stuff we mentioned up in the show notes as well, and there's all good stuff on our website. So go play around, mess around. Have fun. Totally.

[A]

I'm just full of affirmations.

[B]

All right, until next time. Best friends out.

[A]

Best friends out. This is an I Heart podcast.