How to Money: Ask HTM – Spending Cash Windfalls, Retirement Investing vs College Savings, & So You Think You Can Landlord?! #1024

Podcast: How to Money
Hosts: Joel & Matt
Date: August 18, 2025

Episode Overview

In this classic “Ask HTM” episode, best friends and co-hosts Joel and Matt tackle a series of listener questions ranging from handling a cash windfall, deciding between college savings and retirement investing, to the realities of becoming an accidental landlord. Along the way, they share personal anecdotes, practical financial insights, and a healthy amount of camaraderie and humor.

Key Discussion Points and Insights

1. Should I Keep or Sell My Old House When Moving? (Jacob from Wisconsin)

• [12:14] Listener Jacob: Recently got a new job about an hour away, considering selling or renting current house; selling would net $50,000, while renting would earn $800–$900/month above mortgage.
• Matt and Joel’s Guidance:
  • Congrats on the new position! “Jacob, that means you're probably doing a great job at work. So congrats to you!” – Matt [13:31]
  • Evaluate your interest in landlording: If you're excited to manage a rental and put in effort, keeping the house can accelerate your path to financial independence. But being a landlord is a part-time job and requires attention, especially with a property an hour away.
  • The numbers matter: Budget for repairs and factor in real profit beyond just the rent-mortgage spread. The “1% rule” for rentals (rent equals or exceeds 1% of property price) is harder to achieve lately; don’t count on appreciation alone.
  • Loan terms caution: Be wary of offers with “no PMI” (private mortgage insurance). Sometimes “no PMI” loans come with higher interest. “Get multiple quotes, Jacob, to compare apples to apples…” – Joel [15:00]
  • Leverage lockboxes and good communication with contractors to save time on repairs from afar.
  • Tax consequences: Know the IRS “2 out of 5 years rule”—if you’ve lived in a home as your primary residence for 2 of past 5 years, you can avoid capital gains tax on sale. Plan your potential exit accordingly. [23:12]
  • Memorable Quote:
    “It just depends on what reasonable is, because… round trip, you’re looking at two hours. Not to mention the time you’re going to be there… there goes half your workday.” – Matt [18:12]
• Bottom Line: Weigh your willingness for the landlord role and ensure your numbers justify the hassle; don’t underestimate the time or deferred maintenance involved with rentals.

2. Retirement Investing vs. College Savings (Scott)

• [28:51] Listener Scott: Late start saving for his kids’ (a junior and a freshman in high school) college via 529 plans—should he pause retirement investing to save more for their college, and is a 529 a smart vehicle this late in the game?
• Joel & Matt’s Guidance:
  • Don’t disrupt your own retirement: “Saving for your kids really should be a lower priority than your own personal retirement accounts… It’s not selfish to suggest that.” – Joel [33:00]
  • 529 plans now more flexible: Many now allow conversion to Roth IRA dollars if not used for education, and offer low-cost investments. However, if you’ll need the funds soon, aggressive investing in a 529 isn’t prudent for high school juniors.
    • “Investing that money would be too much of a gamble, especially for that junior.” – Joel [35:18]
  • Consider state tax deductions: Only worth prioritizing if your state provides meaningful tax advantages.
  • On making kids pay for college: “I just gotta say, no, I don’t think any parent owes their kids paying for their higher education… you’re doing them a better service by allowing them to pay for a lot of their own school or at least have to think through it.” – Joel [37:28]
  • Alternative approach: Help after graduation by paying off loans instead. If market conditions are poor when tuition bills are due, you can wait for a rebound to tap retirement accounts.
• Memorable Moment:
  “As long as you've talked about it well and they understand why it is that you're making that decision when it comes to your finances… you could land anywhere on that spectrum.” – Matt [40:48]
• Bottom Line: Prioritize your retirement; late-stage college savings are less impactful and shouldn’t derail your own financial security.

3. What to Do With a Six-Figure Windfall? (Quay from China)

• [41:09] Listener Quay: Received $100,000 inheritance after mother’s passing. Already hitting Money Gear Five (solid financial shape); is it best to push towards six-figure investment accounts, save for a house down payment, or something else? Are there tax implications?
• Joel & Matt’s Guidance:
  • Honor emotions and legacy: Consider using a small portion of the money for something memorable tied to your mom (e.g., a trip, a keepsake).
    • “I had a friend… used her inheritance to buy himself a nice timepiece…every time, yeah, he looks at that, he just remembers the legacy…” – Matt [45:06]
  • Focus on maxing out Roth IRAs: The Roth’s flexibility (tax-free growth, potential for penalty-free withdrawals of contributions) makes it ideal, even if you later need funds for a home purchase.
  • Bridge to the six-figure mark: There’s special psychological and financial momentum at reaching $100k invested.
    • “Once you start getting up there close to…$100,000…it feels like the wind’s at your back a little bit… the more it builds beyond that, it’s even better.” – Matt [47:36]
  • House savings—depends on timeline: If buying a home is uncertain or 5+ years away, keep investing; if earlier, consider more conservative saving.
  • Tax implications: No Federal tax on inheritance at this level; some states have inheritance taxes (only 6 states in 2025), so double check your situation.
• Bottom Line: Use a modest portion to honor your mom, but prioritize Roth IRA maxing and investment growth unless home buying is imminent. No taxes due on the windfall in most cases.

4. Rapid-Fire Listener Qs (Money for Kids Abroad, First Phones, and Spending Abroad)

a. Best Card for Teen’s European Trip (Jamie) [54:35]

• Best approach: Add your child as an authorized user to one of your credit cards with no foreign transaction fees—kids under 18 generally can’t hold their own credit card.
• Perks: Helps build their credit history early. Many cards allow adding users as young as 13; confirm with your provider.
• Additional tip: Send a debit card with no foreign transaction fees (e.g., Capital One, Discover) for ATM withdrawals.

b. First Phone for Kids Without Internet/Social Media (Patricia) [59:28]

• Key options: Gab wireless (watch or phone) is popular but may be pricey; using an old iPhone or similar device with parental controls and a limited plan (e.g., US Mobile or Tello Mobile) is flexible and cheap.
• Recommended plan: US Mobile plan at ~$8/month, Tello for even less if no data is needed.
• Bonus: Using a Wi-Fi-enabled device also works in many environments, with proper parental restrictions.

Notable Quotes & Memorable Moments

• “You don’t Alphabet something. No, no, no. You Google it.” – Joel [04:23] (A playful riff on corporate branding.)
• “Sometimes they’re putting forward a problem that you didn’t notice in the first place.” – Matt on targeted YouTube ads [06:50]
• “Don’t go crazy, but a small splurge with a portion of this money could be smart…every time he rode that bike he thought about his mom.” – Joel [44:06]
• “Saving for your kids really should be a lower priority than your own personal retirement accounts…because there are so many other ways to pay for a higher education.” – Joel [33:00]
• “Put a lockbox there at the property because that can so easily save yourself at least two hours driving back and forth…” – Matt [21:58]

Timestamps for Major Segments

• [12:14] Renting vs. selling your house – Jacob’s Question
• [28:51] Saving for college vs. retirement — Scott’s Dilemma
• [41:09] Handling a windfall – Quay from China
• [54:35] Sending a child abroad with a card – Jamie’s Question (Facebook)
• [59:28] Best phone options for kids — Patricia’s Facebook Question

Episode Tone and Style

As always, the episode crackles with Joel and Matt’s easy rapport, dry wit, and strong commitment to practical, judgment-free financial guidance. There’s earnest encouragement for listeners to take charge of their finances, with plenty of side tangents (chocolate, nail clippers, robot vacuums) keeping the mood light and relatable.

Conclusion

This “Ask HTM” episode delivers a rich mix of tactical advice and larger reflections on financial priorities, all while making personal finance accessible and even entertaining. Whether you’re dealing with a surprise inheritance, trying to make the right choices for your kids’ future, or just grappling with the possibilities (and pitfalls) of real estate, Joel and Matt help you weigh the options and point the way toward smarter, more values-aligned money decisions.