Friday Flight - Pricey Porch Pumpkins, Twitter for Trading, & Saving for a Spouse #1038

Summary

How to Money – Friday Flight #1038: Pricey Porch Pumpkins, Twitter for Trading & Saving for a Spouse

Podcast: How To Money
Hosts: Joel and Matt (iHeartPodcasts)
Date: September 19, 2025

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Episode Overview

In this Friday Flight, Joel and Matt share their insights on the week’s most impactful personal finance news and trends. The episode covers the implications of the latest Federal Reserve rate cut, the surprising rise of expensive porch pumpkin decorating, social trading developments at Robinhood, labor market shifts, changes in tip taxation, the dangers of tapping retirement funds early, and how personal finance decisions can impact life milestones such as marriage, kids, and even divorce.

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Key Discussion Points & Insights

1. Federal Reserve Rate Cut & Its Ripple Effects

• [02:30] The Fed has cut interest rates by 25 basis points. While mortgage rates won’t immediately reflect this change, savings rates might drop faster.
• [02:56] Matt: “A quarter point rate cut, what that means for our... Everything, Joel, are you kidding?”
• This rate change could lead to more fluidity in the housing market, making it easier for people to move or buy, but effects for borrowers and savers may be uneven and gradual.

2. The Pricey Porch Pumpkin Phenomenon

• [05:54] The co-hosts discuss a recent Axios article about people hiring "porch pumpkin decorators" to spruce up their homes for autumn at shocking costs: $700–$1,300, with up to 96 pumpkins per package.
• [07:20] Joel: “People are hiring folks for, you know, 7, 800 bucks a pop up to like 1300 bucks to toss pumpkins on the porch.”
• Matt and Joel reflect on the loss of hands-on, family traditions like pumpkin carving, encouraging listeners to save money and build memories by doing it themselves.

3. Recency Bias in Investing Returns

• [09:55] Referencing writer Jason Zweig, they warn against assuming that recent outsized stock market returns (~15% annually) will continue, cautioning about “recency bias.”
• [11:16] Joel: “That’s the kind of assumption that can blow up in your face, especially if it leads to you saying, great, I can take my foot off the gas pedal...”

4. Robinhood’s Social Trading Expansion

• [12:15] Robinhood introduces social media features allowing users to post trades and insights, aiming to tap into the 'WallStreetBets' crowd.
• [13:02] Matt: “It can be very funny... but if it turns into like the Instagram version... where it creates that envy, that mimetic desire... that’s the part of it I don’t like.”
• The hosts agree that while sharing trading wins and losses can provide cautionary tales, they discourage getting caught up in social trading and urge listeners to stick with long-term investing.

5. The ‘Job Hugging’ Trend

• [15:39] As the labor market tightens and job switch pay bumps wane, people are now “job hugging”—clinging to their current positions instead of job hopping for higher salaries.
• [16:21] Joel: “Move over job hopping. We’re doing more job hugging these days... people are becoming more attached to their current job as the economy appears to be tightening...”
• While holding onto a job isn’t bad—especially if you like it—the hosts remind listeners not to ignore better opportunities, and to stay prepared for layoffs or changes.

6. New Tax Breaks on Tips

• [17:57] Recently passed legislation (the "One Big Beautiful Bill Act") now exempts up to $25,000 in tips from federal taxes for a broad range of jobs, including not just service positions but digital content creators, musicians, and even nannies.
• [18:49] Matt: “It’s fascinating, because up to $25,000 can be deducted from these earned tips... it’s not exactly clear how folks should be taking advantage, but... these are dollars that need to be paid as tips.”
• This move partially recognizes the underreporting of cash tips—though state and payroll taxes still apply.

7. Personal Finances Impacting Major Life Decisions

• [26:27, 29:04] The Wall Street Journal reports more split couples opting to continue living together to keep their 2–3% mortgage rates. This underscores how personal finances can dictate life changes far beyond budgets.
• [29:15] Joel: “Saving more, reducing your debt, it creates more margin in your life and allows for a wider range of decisions that you might prefer to make for non-monetary reasons.”

8. Delaying Relationships and Kids for Financial Security

• [30:14] Young people are increasingly delaying marriage or children until they feel financially ready—but the hosts warn this can take the “planning mentality too far.”
• Matt: “The very act of committing to a relationship is in and of itself character-forming... there’s something about growing from not having a lot and then having more together.”
• They cite the example of Ebenezer Scrooge, who prioritized money over love, and encourage listeners not to miss out on pivotal life experiences by waiting for perfect financial conditions.

9. Dangers of Tapping Retirement Funds Too Early

• [24:22, 27:04] Gen Z is increasingly using retirement savings to pay down debt. The hosts urge listeners to avoid this, citing the critical importance of compounding.
• [27:04] Matt quotes Charlie Munger: “The first rule of compounding is to never interrupt it unnecessarily.”

10. Using Artificial Intelligence for Personal Finance Advice

• [35:13] The hosts discuss the rise of AI-powered money tools (like ChatGPT) and urge caution: over half of users in a Credit Karma survey regretted acting on AI-sourced advice.
• Joel: “The effective use of AI actually comes from knowing the subject fairly in depth first. If you’re... just assuming that whatever one of these AIs spits out is going to tell you what you need to know... I think you’re probably sorely mistaken.”

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Notable Quotes & Memorable Moments

• On Rate Cuts:
  Matt [02:56]: “A quarter point rate cut... what that means for our everything, Joel. Are you kidding?”
• On Expensive Pumpkin Decorating:
  Joel [07:20]: “People are hiring folks for, you know, 7, 800 bucks a pop up to like 1,300 bucks to toss pumpkins on the porch.” Matt [07:21]: “That’s 94 pumpkins too many.”
• On Recency Bias:
  Joel [11:16]: “That’s the kind of assumption that can blow up in your face...”
• On Social Trading:
  Matt [13:02]: “If it turns into the Instagram version... where it creates that envy, that mimetic desire... that’s the part... I don’t like.”
• On Using Retirement Funds Early:
  Matt [27:04]: “The first rule of compounding is to never interrupt it unnecessarily.” (quoting Charlie Munger)
• On Delaying Major Life Events:
  Matt [31:24]: “Once that [marriage]—I’m leveling up. Right. As opposed to seeing it as something that you do together... what’s more beautiful than having worked through some of these hard things in life with your best friend...”
• On Financial Margin:
  Joel [29:15]: “Saving more, reducing your debt... allows for a wider range of decisions that you might prefer to make for non-monetary reasons.”

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Timestamps for Important Segments

• [02:30] – Impact of Federal Reserve Rate Cut
• [05:54] – Rise of Pricey Porch Pumpkin Services
• [09:55] – Recency Bias & Market Returns (Jason Zweig reference)
• [12:15] – Robinhood Adds Social Features; Dangers of Social Trading
• [15:39] – Labor Market Shifts: Job “Hugging”
• [17:57] – No Federal Tax on Tips: Who Qualifies
• [26:27] – Gen Z Tapping Retirement Accounts to Pay Debt
• [29:04] – Financial Factors Driving Life Decisions (divorce, cohabitation)
• [30:14] – Is Waiting for Financial Security Delaying Life Milestones?
• [35:13] – Using AI for Money Advice: Pitfalls & Cautions

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Key Takeaways

• Don’t overreact to economic headlines—rate changes trickle through slowly, impacting different areas unpredictably.
• DIY can save both money and build memories—don’t let convenience rob you of meaningful traditions.
• Stay grounded about long-run investment returns—recent outperformance isn’t the new normal.
• Don’t get swept up in social trading; focus on consistent investing, and beware of FOMO.
• The job market is shifting—be valuable at work but stay prepared for opportunity, even as job hopping wanes.
• Take advantage of new tax benefits with full knowledge and integrity.
• Avoid using retirement dollars to patch short-run debt—compounding works best uninterrupted.
• Money impacts major life choices—build flexibility and “margin” to give yourself options for things that matter most.
• Don’t put off life events solely for money reasons; growing together through leaner times can be transformative.
• Use AI advice carefully—trust but verify, and invest in your own knowledge.

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Overall Tone: Friendly, accessible, and occasionally irreverent—Joel and Matt balance serious financial advice with humor and a focus on making wise decisions that fit listeners’ real lives.

Transcript

[Matt]

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[Joel]

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[Joel]

Welcome to how to Money. I'm Joel.

[Matt]

I'm Matt.

[Joel]

Today we're talking pricey porch pumpkins. Twitter for trading and saving for a spouse.

[Matt]

O Saving for a spouse. What does Joel mean when he says that? We'll get to that story.

[Joel]

You'll find out in a little bit.

[Matt]

Yes.

[Joel]

Yeah you will. I've already purchased mine, so you're right.

[Matt]

There's aspects of saving up for a wedding, but that's not even what we're going to talk about, is it? This is our Friday flight. We're going to get to some of the best stories that we came across this week and how they specifically pertain to your personal finances. And first, dude, we got to talk about the rate cut.

[Joel]

Brown.

[Matt]

Brown. 25 basis points. Woo.

[Joel]

I mean it was like the rates are slash. The predictions were spot on. This is what happened. And maybe I think just from a personal finance standpoint, this is like a socio political economic thing. But when it gets down to the personal finance level, Matt, a quarter point rate cut, what that means for our.

[Matt]

Everything, Joel, Are you kidding?

[Joel]

I wouldn't say everything.

[Matt]

It's time to buy a house, bruh.

[Joel]

We will see what the impact is on mortgage rates. Typically that takes a lot longer, right. To filter through the system. So like will mortgage rates collapse by a quarter point tomorrow? No, that's not what I know. Will your savings rate collapse by a quarter point tomorrow? Probably.

[Matt]

Probably a little bit faster. Yeah, it's. Yeah, it's interesting.

[Joel]

By tomorrow, I mean, yesterday it might already happen immediately.

[Matt]

Yeah, well, it does depend on. So there are certain things, certain factors. I mean, I would say that we saw the market react even before the rate cut was announced because folks were like, we're pretty sure that we're going to see a rate cut. So that was kind of built in. But in addition to that, you see faster movements within the market. When it comes to actual lending costs, that takes a little bit longer. I wouldn't be surprised if we see lending costs take months to adjust as it trickles through the market. But as far as the overall economy, and I think that's the biggest reason to pay attention to this, that hopefully things will get back to flowing. Especially when, when it comes to the housing market, man, like things folks have, I think folks have felt trapped wherever they currently are. I think there's a lot of individuals who are thinking, man, I would like to be able to move to a different location or to take this opportunity, but borrowing costs have been so high. So hopefully that's something that we will get to see.

[Joel]

I think eventually once we see rents have been ticking down, I think once they touch the level, like the five level, it'll be interesting to see how that impacts the housing market because I agree that's a big part of what's kind of jamming up the gears because preventing people from wanting to sell, preventing people from wanting to buy. And so maybe we start to reach this point where there's a little More fluidity in that market.

[Matt]

Yeah, yeah, Hoping so.

[Joel]

Let's talk about pumpkins for a second. Matt, can we talk about pumpkins? Gourds? Yeah, let's do it. Since we're getting close to Halloween, I mean, they, I feel like they put out costumes like three months ago, which was ridiculous, but now we are actually getting close enough to where. I'm enjoying seeing that stuff on the rack. Or I don't drink pumpkin spice lattes. It's kind of a personal thing.

[Matt]

We know.

[Joel]

Kind of hate it.

[Matt]

You hate the stuff?

[Joel]

Yeah. You like. You're okay with pumpkin spice lattes? Nope. Okay. You don't like them at all?

[Matt]

I don't do anything. I will get a flavor. I will get a caramel latte.

[Joel]

Okay.

[Matt]

So if, if it's a coffee shop, and especially if they make their own caramel, right. If they're stirring the sugar and they, I mean, come on. If someone is actually crafting it like that, that's a quality drink.

[Joel]

I don't want to rain on other people's parade though. If they're into it. I'm not, I'm not judging you. Enjoy what you love.

[Matt]

I'm a coffee snob, so I don't often get much of anything from Starbucks, to be honest.

[Joel]

Okay, but. But specifically I was talking to a neighbor the other day and his daughter does exterior fall holiday decorating. And I didn't know that was a thing. Like I've seen people saying, oh, we'll put up your Christmas lights for money and we'll bring them, you know, take them down for you too.

[Matt]

I've seen that. Up, there's a billboard over. As we get closer to the holidays, there's a billboard that goes up and it's a company that specializes in. That makes sense. Which I get because there's an actual risk if you think about it.

[Joel]

I mean, how many people fall and get hurt on ladders?

[Matt]

I don't know. If you got a two, it's one thing if you've got a ranch, you've got a. Well, you got a split, what do you call it?

[Joel]

Split level. Split level, yeah.

[Matt]

But you know, that means half of it's a range. But like there's. I don't know. And you're tall, so you only have to like step up on a bucket.

[Joel]

If I fall, I don't fall asleep.

[Matt]

And you're putting the lights up. But for folks who have a two story home, it's like, oh, that's a real danger to put your own lights up. That's you are not being frugal. If you were to put your own lights up, maybe you're being cheap because you might end up hurting yourself, man.

[Joel]

Yeah, I mean, that's true. But I will say, like, you're light, less likely to get hurt putting pumpkins out around your mailbox or on your front porch. I believe it. And so now this is another service where people are like, let me put a bunch of gourds around your house to spice up your autumnal flair. And again, I didn't hear of this until my neighbor told me this is what his daughter does. But then Axios had an article this week about the rise of, like, porch pumpkin decorating. And people are hiring.

[Matt]

Porch pumpkins?

[Joel]

Yeah, people are hiring folks for, you know, 7, 800 bucks a pop up to like 1300 bucks to toss pumpkins on the porch. There's a, like a 28 pumpkin package. There's a 96 pumpkin package.

[Matt]

Like, what is 96 pumpkins?

[Joel]

Isn't that insane?

[Matt]

That's 94 pumpkins that are too many. Yeah, that's quite.

[Joel]

That's quite a few.

[Matt]

Like, you put a couple pumpkins out, that's fine. Maybe three if you don't like the symmetry between. Okay, three is fine.

[Joel]

I think three. I've got three steps on the front porch. I'm down to put three pumpkins out there. I think on one hand, I think, I love that people can start a side hustle or a small business doing something for other people. They can make money doing something that people don't want to do. The Christmas lights thing being a perfect example of that. How people are like, eh, it's dangerous. Eh, I'm going to make. It's not going to look as good if I do it. I'm willing to hire that out. I haven't hired that out, but I don't know, maybe someday. But my goodness, people spending $1,000 to have someone else put pumpkins out around their house. Seems excessive.

[Matt]

Yeah, no. I instead will be going to Aldi, of course, and I'll buy some pumpkins. I think they, a lot of times they come in earlier, so keep an eye out. Like towards the end of September, early October, they'll get the first batch in.

[Joel]

Oftentimes, what I remember at least already decorated outside. So I guess somebody already has pumpkins.

[Matt]

Yeah, somebody does. I haven't been to Aldi yet this week, so. But regardless, do that. Swing by Home Depot, pick up a bale of hay, break out the knives and sharpies, cover up your own pumpkin. And this Is something you could. I don't know, it's something you do as a family as well. I feel like there's so much outsourcing that we do in our lives as opposed to, hey, what about the old fashioned? Like, sit down with the kids. Oh, let's dye our own Easter eggs. Oh, let's carve out our own. These are like, core memories I had, at least as a kid. Maybe this is me harking back to the 80s and how great things were, but I think that that not only is a fun thing to do, but of course it's gonna save you a ton of money.

[Joel]

I still remember when my little sister, they used to make the dyes. They came in little tablets that look like sweet tarts.

[Matt]

Yep.

[Joel]

She totally ate one. Foaming at the mouth with colors coming out. That was a. That's a core memory.

[Matt]

Was this Sally?

[Joel]

Yeah, of course. I mean, who else would it be?

[Matt]

I could totally do that. I guess Katie would have been too old. Yeah. Yeah, she would have known better.

[Joel]

Yeah. Good times.

[Matt]

As I mentioned, I'm sure her teeth were so stained, and, I mean, that's like a hardcore die. Yeah. Not only.

[Joel]

You had to call poison control, I think, and mom was freaking out.

[Matt]

Pretty sure she was.

[Joel]

Okay, well, in these companies, Matt, they will also charge you extra to take off those moldy pumpkins to throw them in the trash so you don't have to do it yourself.

[Matt]

Well, they don't get mold.

[Joel]

You can find a service for anything. But, like, they only get mo if you.

[Matt]

If you carve them.

[Joel]

So that's.

[Matt]

That's the. The plus, because we've intentionally not carved some of our pumpkins in order to make them last. Like, you can stick them out on the. On the front porch, and they'll last for weeks and weeks, and then you bring them inside, and then you can chop that thing up fresh and then use that pumpkin to make some pumpkin pie.

[Joel]

That's what it is.

[Matt]

Roast those pumpkin seeds, man. They're so good.

[Joel]

My favorite.

[Matt]

Let's talk about investing and specifically, Jason Zweig wants us all to be careful of the assumptions that we make as investors. And he had a great article about specifically how great returns have been lately. And I think we might all have a case of recency bias. Right? Like, you might expect the same 15% returns that we've experienced over the past decade to just maybe perhaps continue over the next decade. Stock market highs. They have helped account balances soar, which certainly feels nice. But there is a downside to it, which is Getting used to the fact that we have seen returns soar this high, and then once you've gotten used to it, you start to expect it. And we tend to forget the likelihood of reversion to the norm. Instead, we're thinking that stocks are going to likely continue to outperform historical returns basically in perpetuity. And this is causing some investors to assume these higher returns and they're likely to receive, which is then leading them to save less for their retirement because they're like, it feels like it's like an E assist for their investments. They're just like, oh, it's so easy. But at some point I think the juice is going to run out of the battery and then you're stuck. Like, oh, not only do I not have that additional support, now the bike's a little bit heavier because I got this dead weight that I'm having to pedal along with me. I think when you start to count on the kind of returns that we've experienced over the past 10 years, that's when things can begin to start getting dicey.

[Joel]

I think that's the kind of assumption that can blow up in your face, especially if it leads to you saying, great, I can take my foot off the gas pedal just a little bit. Maybe it's like an entitled attitude that investors are starting to adopt as returns have been incredibly robust. Compounding returns, they're a phenomenal thing. The more we contribute, especially in those early years, the more we benefit from compounding returns. Don't take your foot off the gas pedal in assuming that compounding returns will do all the work for you. You have to participate in the ability for your dollars to grow. Let's talk about Robinhood for a second. Matt. Speaking of investing, they had a good a nice stock bump up in price after being added to the s and P500. And then though they announced that they are similar to other trading apps, adding social media elements for Robinhood users. They kind of want to, I guess, take over the role maybe that Wall street bets on Reddit has been playing. But now I don't think there's any.

[Matt]

Way they're going to be able to replace that.

[Joel]

Yeah, maybe. Have you ever been over there, like, once?

[Matt]

I have. For educational purposes, not because I'm over there trying to get hot stock tips or anything like that.

[Joel]

I know what you're doing behind the scenes.

[Matt]

No, honestly, it's hilarious. And like, my take is that if Robin Hood is, if they're looking to emulate something like that, if they truly are trying to Replace this sort of memory that goes on. I think that's one thing because there's a whole lot of jokes and it can be very funny because there's a lot of folks who are just poking fun, they're making fun of themselves for being idiots. Going all in on like I just saw one recently where it's just like me listening to an earnings call of a company where I own just one stock and it's got a guy, he's like one share. Yeah. And he's just sitting there listening to the.

[Joel]

My $40 could go up to 45 if this goes well.

[Matt]

It's so dumb. So that I appreciate not taking yourself seriously, but if it leads to hope, you know, some folks thinking, oh, maybe I'll do what that guy over there is doing. Oh, they, you know, they posted some wins if it turns into like the Instagram version copycat of social media, where it's like, creates that, that, that envy, that mimetic sort of desire where you're just like, oh, I'm going to hop over there because that seems to be winning. That's the part of it that I don't like.

[Joel]

Yeah, yeah. Well, so on this Robinhood Social, which is supposed to launch soon, you can post your trades, you can offer your own investing insights, telling everyone else, yeah, what you're up to and why you think that such and such stock is going to the moon or whatever. And first, I don't think any of us really need more in social media apps in our lives. Like, aren't we already overrun with just social media requests, other things that we have to check in on? That's just a non starter for me. And on the bright side, users are going to have to show proof of trades in order to post. So you can't just like be pumping stuff that you didn't actually participate in, which could be super misleading. But I think this is still the opposite of our aim, Matt, and what we encourage people to do, which is to keep buying but to not really participate in trading because you're going to do better, you're going to keep more precious mental bandwidth the same time and you're going to avoid this temptation to trade or to participate in activity that could lead to inferior results and a lot of wasted effort.

[Matt]

True. Yeah. I guess the reason I'm saying I'm allowing for there to be some possibility of folks entertaining the idea. I just don't want to like outright, outright ban it and be like, hey, you can't do this because then it becomes the forbidden fruit you know, like, people are going to experiment. They're going to take a look at it. They're going to be like, oh, what's going on over here? But it's just about taking, I think, the right approach, which is honestly why I kind of mostly appreciate the Wall street bets. And I know there's a lot of unhealthy advice being given over there, but the fact that folks are just cracking jokes and making fun of themselves, making.

[Joel]

Fun of each other, I'm not mad that it exists. I just think you need to be careful before.

[Matt]

You've got to be careful.

[Joel]

Go all in. And you've got to let yourself. I'm gonna live my life according to this code of conduct that, you know, the people around me are living by.

[Matt]

I think another silver lining is if people are able to, like, if folks are more not just posting their wins, but if they're also, like, I would love to see a ton of folks posting their losses.

[Joel]

Yeah.

[Matt]

Because then if they're sitting there and they're lamenting their losses, and then you've got individuals who are able to see that and be like, oh, homie, just lost 10 grand, like, in 30 minutes. That's not something I can afford. I don't want to emulate that. And hopefully there can be some secondhand lessons learned from any sort of posting of that flavor.

[Joel]

Agreed.

[Matt]

Yeah.

[Joel]

All right, let's talk jobs. The labor market is tightening. We mentioned the revised Bureau of Labor Statistics stats that they released about how many jobs were created and the decline in pay for switching jobs. We've talked about that, too. There was this massive spike. And hey, if you go try to find another job, you might get paid 15 or 20%, 30% more. Some of the stories we heard from how to Money listeners were incredible. Matt. Of how much they were able to make by just looking for a job with another employer. But this ain't 2022 anymore, man. This ain't Kansas anymore, Toto. And this means that move over job hopping. We're. We're doing more job hugging these days, which, of course, there's got to be a cutesy word for it. That's part of the.

[Matt]

Part of the everyday lexicon, part of the media landscape.

[Joel]

Yeah. So. And it's just what it sounds like. Like people are becoming more attached to their current job as the economy appears to be tightening, and they're just clinging to it for dear life, I guess. And this is not a bad thing. Right. Especially if you like your job. Like, why? Why, if you're fond of It. But a lack of fluidity in the workforce, it's just not the best thing for a dynamic economy either. So hug your job if you need to make yourself invaluable. So they're hugging back onto you. But just also know that because the trend isn't your friend. Right. That doesn't mean you can't find something more fulfilling or lucrative just because it's less likely. And it's not, as the job market isn't in the same place it was a few years back that you can't. That it's impossible. Right. To go out there and earn more or get a better paying job or something that you're more excited about. It's never been a bad idea to be prepared for a layoff, by the way, if you're really bored. Right. You might be able to even engineer your own layoff if you've been saving for that possibility. It can make a lot of sense. But yeah, the job market is in a tougher place for a lot of folks. But that doesn't mean. I don't think. Matt, I think sometimes people read those headlines and they're like, that means I have zero options. And I just don't. I just don't think that's the case either.

[Matt]

I totally agree. Let's talk about how you're taxed on the money that you make at your job. We're going to talk now about no taxes on tips because that's something that we heard a lot about leading up to the presidential campaign. Certainly became a Republican and a Democrat.

[Joel]

Cause, yeah, both candidates were shouting it from the rooftops.

[Matt]

Everybody was no tax on tips was jumping on. So it was finally implemented in the one big beautiful bill act through 2028. And the treasury, so they just released a list of jobs that are going to qualify. And of course there are many jobs that qualify, like the food industry, beauty jobs like barbershop nail salons, like places where you are used to leaving tips. But also. So. Right. So you got like all the jobs that you could imagine.

[Joel]

Like you might assume would get this.

[Matt]

Yeah. Like where. Like a waiting room attendant, you know, or I don't know, like all these different places where there's someone standing there and it's like, oh, this is one of those instances where I'm supposed to give you a few dollars, isn't it?

[Joel]

Because you just handed me my napkin or my towel to wipe my hands off.

[Matt]

Yeah. What kind of fancy restaurants or hotels?

[Joel]

I've heard about them.

[Matt]

But that being said, there are also some jobs on There that you wouldn't have expected, like digital content creators, like, which I think podcasters actually qualify. Like we are under that subheading, musicians, electricians, plumbers, landscapers, nannies. We will link to the list. But it's fascinating because up to $25,000 can be deducted from these earned tips. And so, like I was saying, you need to act accordingly. It's not exactly clear how it is that folks should be taking advantage of this, but it certainly starts with the fact that these are dollars that need to be paid as tips. So you can't just be like, okay.

[Joel]

Now I'm reclassifying my.

[Matt]

Now I've got tips.

[Joel]

Yeah.

[Matt]

I don't think it's going to be that straightforward, but it's just a fascinating look at what it is that changes in tax policy, how that can impact how much we pay in taxes.

[Joel]

Sure. And it's also. I think it's also one of those things mat a lot of tips weren't reported as income anyway, so maybe this is just a chance to.

[Matt]

Oh, I totally agree.

[Joel]

To let the tax code mirror human behavior.

[Matt]

Catch up a little bit.

[Joel]

Yeah.

[Matt]

It's like it formalizes something that. And we're not advocating, you know, you're not certainly encouraging that folks don't report earned wages or whatever. But, like, fact is, I'm sure there's plenty of folks and especially like the more traditional garnered tips via cash. I got a feeling that there's a lot of those folks that weren't reporting that. So this sort of formalizes. Yeah. What's actually happening on the ground.

[Joel]

By the way, you'll still owe state taxes and payroll taxes on tips. This does not eliminate that. It just eliminates up to a certain percentage or up to a certain dollar amount.

[Matt]

25,000.

[Joel]

Yeah. The federal tax requirement on those tips.

[Matt]

Yeah. It almost makes me think of what if the federal government was like, hey, you know what? From now on, we're not going to give speeding tickets. If you go 5 miles per hour over the speeding, over the speed limit. And I think there's a lot of folks, it's like a collective guilt that everyone. That or a lot of people have that there's just like a blanket relief of like, okay, we don't have to worry about that anymore.

[Joel]

But then imagine getting the ticket for going six miles an hour over and you're like, come on, that's the thing.

[Matt]

You break the law. You should. And you get caught. You should expect to suffer the consequences.

[Joel]

That's a part of it. You do the crime you pay the time. Is that. What is that from? I don't know.

[Matt]

Judge Judy, probably. Was that one of the ones that you used to watch with your grandma? Wheel of Fortune.

[Joel]

Judge. Judge Judy. It was. It was mostly prices, right?

[Matt]

Oh, that's right. I thought you did Wheel of Fortune too.

[Joel]

A little bit. She liked Jeopardy. A lot. She still likes Jeopardy.

[Matt]

That's why. See, this is why you're so good at just like winging it and guessing. Did you ever. You watched Grocery. Grocery. What was the sweepstakes?

[Joel]

Oh, supermarket. Sweet.

[Matt]

Yeah, the one where they were running through the supermarket with it with a cart.

[Joel]

That one was not nearly as good, but I would watch it on occasion.

[Matt]

You didn't like that one? I remember as a kid loving at least the. I just love the fact that they're running through a grocery store. And that's not something as a kid I was allowed to do.

[Joel]

I think it was always on some like, ratchet channel, so maybe I just never found it. But okay, I watched it a couple of times.

[Matt]

Maybe it was on like TMT instead of tnt.

[Joel]

Yeah, that could be. All right, we've got more to get to, including. Let's talk about using AI for money advice. And just when it comes to making life decisions, your finances have a huge impact over those decisions. We'll talk about that and more right after this. Degree Advanced the world's number one antiperspirant provides up to 72 hours of protection against sweat and odor that comes with life. Degree is the wake up workout. Antiperspirant the dashing, darting, carpool, honking, get the kids off to school. Antiperspirant the work from home and do the laundry, grocery shop on your lunch hour. Never take a break.

[Matt]

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[Joel]

My how time flies 2025. It's going to be gone before we know it. But before it's gone, there's a lot of life to live right, including a lot of kid activities, the holiday get togethers and a whole lot more. All this activity though, it can cause us to put off tasks on our to do list. But juggling a million plans shouldn't mean your future doesn't make your to do list. Trust and Will turns estate planning from a When I have time task into a quick, straightforward process ensuring you're protecting your family's future. Today. Go to trustandwill.com howtomoney to get 20% off their simple, secure and expert backed estate planning services. That's right.

[Matt]

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

[Joel]

Add some peace of mind to your future with Trust and will go to trustandwill.com howtomoney for 20% off. That's 20% [e-mail] howtomoney all right, we're back. Matt, time for the ludicrous headline of the week. Yes, it is. This one comes from cnbc. It says the headline was Gen Z is using retirement savings to pay down debt. And I saw this and I was like, no, like super slow Mo. Because you and I, we love the idea of people paying down debt. We want people to be debt free. Except for that Mortgage, maybe if it's like 3%, you probably want to do other things with that money before you start paying that, that mortgage down. But truly, especially if we're talking about credit card debt, some of the more nefarious forms of debt, like we want you to get after it, we want you to get that out of your life. We rarely want to discourage people from paying down their debts. Right. I guess in maybe a few cases it might make sense to take money from retirement accounts to pay down an egregious debt. Let's say for instance, you had a payday loan and it was becoming an albatross around your neck. Then maybe this is something we would suggest, but, but I think this is becoming just an access problem because it's easier to access money from your 401k these days without fully understanding the trade offs people are doing it. It's becoming more common. And so this article revealed that half of gen zers have already tapped their workplace retirement account. We're talking about gen Z ers where the average age is what, 20, low 20s or is it 28 is the upper end of the of the spectrum. So when you think about still half. Right.

[Matt]

That's a lot.

[Joel]

That's a lot of folks. And so it seems like at least it's not just to buy stuff like oh, I'm taking money out of my retirement account to like, you know, purchase more like purchase a jet ski or something like that. But it is to pay down debt. But still it's a bad idea, right? Because it's better to get frugal to come up with a debt payoff strategy that you can execute in short order.

[Matt]

It's better to scrappy. Yeah.

[Joel]

Or if you're in what I want to see like a significant debt issue, get help from a nonprofit like Money Management International. But like robbing your future self. It might feel like the easiest way to get rid of that debt quickly, but it just leads to other complications in your financial life.

[Matt]

Yeah, no, we're talking about missed time in the market and you could be at risk for taxes and penalties if you don't. If you don't jump through the right hoops. If you're not, if that money hasn't been there long enough and maybe you're not fully vested, you could miss out on some, some of those match dollars as well. But it poses added behavioral risk as well because if you grab the easy pile of cash instead of going through the discipline debt payoff slog, well, you might not learn your lesson. I think as Effectively meaning that you can just find yourself back in that exact same position. And these are retirement dollars. So I've got to quote Charlie Munger because he pointed out that the first rule of compounding is to never interrupt it unnecessarily. We want folks to come up with a debt payoff plan that doesn't involve putting your sticky fingers into retirement. We don't want you. It's like you're messing with a cake that's bacon. You're going to mess it all up. Just let it be, let it cook.

[Joel]

Yeah, exactly. So pay off your debts, but don't use your retirement dollars to do so. There was an article in the Wall Street Journal, Matt, that I was reticent to bring up on the show today, probably because it's talking about substantial life things that people go through. This article specifically highlighted the rise of divorcees living together after they've split up because the low mortgage rate was just too good to let go of. Like, hey, we got this 2.25% mortgage. Gosh, we really don't like each other right now. Or we know that it's best for us not to stay together over the long term, but we got to stay together for now because we're financially, it's the, it's the only move we can really make. And so the more I thought about it though, the more it was apparent that this is indicative of an ever present reality that personal finance influences an incredible number of our life decisions. And that, you know, basically the financial reality of selling a home with a locked in low rate mortgage, it's just too much to bear for some people in the current environment, even if the home no longer works for your family. So one of the families they highlighted in this article, Matt, was there's. They took turns living in the house and they had an Airstream in the backyard.

[Matt]

Yep. And so in that part, in that case it seemed like they're doing it also for the kids. Right. To help provide some stability there.

[Joel]

Which, which makes sense. I totally get.

[Matt]

Seems like such a messy situation for sure.

[Joel]

And I'm not, I don't think either you or I are trying to judge the relational decisions these folks are making. We're just pointing out that, that saving more, reducing your debt, it creates more margin in your life and it allows for a wider range of decisions that you might prefer to make for non monetary reasons. Right. And so just living paycheck to paycheck has bigger consequences if other circumstances in your life that are outside of your control, if those change or Even things that are kind of inside of your control. The less money you have on hand, the fewer options you give yourself when things, when you end up in a tough spot.

[Matt]

What do you think about the couple?

[Joel]

You don't have that peace out money, I guess. You know, that's true, that's true.

[Matt]

But in this case with a divorce, what if it means that, hey, they kind of give it a second shot and it causes them to stick around a little bit longer and they kind of work through it. Oh, they've let's, they're gonna, let's go see a counselor and before you know it, they're back together. Hey, that's silver lining.

[Joel]

That's the bright spot, right?

[Matt]

Potential bright spot, potential upside of not having the financial, financial margin.

[Joel]

I'll be hoping that for those folks.

[Matt]

Yeah. So this makes me think of another article from the Times about money and life and whether you should wait on love until you've made more progress when it comes to your, your finances with your money. More young Americans are waiting to get married or they're waiting to have kids and in an effort to create more financial security because they're assuming that having more money is going to basically add.

[Joel]

Stability to the relationship.

[Matt]

And I am all for exercising some wisdom and not jumping willy nilly into a relationship where, you know, your finances or their finances are in complete disarray. But man, this is a scenario where I think if you, if you are too focused on this, you're taking things too far. Right. I think the very act of, of committing to a relationship is in and of itself character forming. Right. Like it is formational going through the process of marriage. And I think a lot of times in our culture we have such a consumption based mindset around how we approach different things like this. And I think some folks see getting married or that spouse as being this, like, oh, this is the goal. This is, that's the final boss.

[Joel]

Like the capstone event I'm going to.

[Matt]

Yeah. Once that I'm leveling up. Right. As opposed to, to seeing it as something that you do together. Right. Like what's more beautiful to me at least than to having worked through some of these hard things in life with your best friend, essentially that you've, that you've married. And the same thing is true with kids. So many people are thinking, oh, I've got to get to a point to where I feel like, oh, we need to have this much set aside. Oh, we need to do this. Oh, we can't be in this old rundown house. Oh, the kids can't share a bedroom. Like, these are all excuses that we give as opposed to saying, no, we want to have kids. And quite literally, there's a biological clock that's ticking, that's kind of. That window of time is narrowing. And the very act of having children, it's edifying. It's really hard. But there is so much that you learn about yourself and the sacrifices that you make in order to provide for those kids, that the very act of having the kids is what makes you ready to be the person that you're ultimately going to be. Right.

[Joel]

It's weird how it calls you into something bigger and greater.

[Matt]

Yeah. Yeah.

[Joel]

And I think the financial impetus that it puts on you is actually. Can be a good thing. You're like, okay, I gotta grow up now. I gotta be. It lights a fire in here. You're right. Yeah. And so I think the same thing is true of marriage and having kids that both will help you form better habits and help you make progress in your finances. And there's something. There's something, too, about growing in from not having a lot and then having more together. There's something about the cohesion that creates in your relationship.

[Matt]

Get to do that with your teammate, with your partner for life.

[Joel]

If you do it solo and then you come together with, like, gobs of money, you actually kind of miss something along the way, I think so. I don't love it. And honestly, it makes me think too, of the literary character Ebenezer Scrooge Matt. Because when, you know, they go back.

[Matt]

To the Ghost of Christmas Past.

[Joel]

Ghost to Christmas Past, he sees his old girlfriend. And of course, he realizes he put more emphasis on making money than he did on tending to the love of his life. And he missed out because of it. Yeah. And I just think that's a real possibility that people don't get. They're just like, I'll just get married later, or I'll just like, yeah, have kids down the road. And. Yeah, at some point, maybe, but that's also not promised to you. So I.

[Matt]

It's not guaranteed.

[Joel]

Yeah. And I don't think most people do it from a heart that he had, but I think they're just like, I want to have my stuff together. And I understand that impulse.

[Matt]

I think. I think it comes from a heart of good. But that's. That's why I said at the beginning. It's. It's like taking that sort of planning mentality and taking it too far.

[Joel]

Yeah.

[Matt]

It's. It's where. And it doesn't seem crazy to say, oh, I need to be financially in a decent place before we take these, you know, more formal steps. But yeah, there's something, there's something about going through that process that is kind of the goal. Right. It's not to have, like, honestly, like, it makes me think of education like higher ed as well, because I think so much. There seems to be a focus on just getting the grades or getting the degree, getting the mba. Right. And it's. And there's not as much attention being paid to what it is you're actually learning. Right.

[Joel]

Like that forming you, the rigor of.

[Matt]

The education, how it's forming you, how it's turning you into hopefully a better, more productive, more virtuous citizen that's going to contribute to our society.

[Joel]

Right.

[Matt]

And there's like a desire to kind of take the shortcut. Like, it's one of the problems with AI.

[Joel]

You just want the credential. You don't actually want the end result.

[Matt]

And you don't really. You're not paying attention to what actually needs to happen in the, in the process. And I feel like we're kind of going more to cultural critique. But that's one of the issues with AI is that like, hey, it doesn't matter. I just need to do what I need to do to get the GPA right or in order to pass my finals in college.

[Joel]

Even if it means allowing artificial intelligence to write the answer for me or. Yeah, to do most of the work.

[Matt]

Yeah. Because you're not only obviously cheating the system, but like you're cheating yourself from being able to be formed into the, into the. Essentially the best version of yourself.

[Joel]

Yeah. Speaking of AI, let's talk about using artificial intelligence, specifically the get money advice.

[Matt]

Got a feeling I'm going to disagree with this.

[Joel]

Well, obviously the rise of AI for search has been fascinating to watch. It's been incredibly quick. And visits to sites like ours, like howtomoney.com have gone down pretty significantly because Google has become less integral to the way people look for information. Even Google results implement a lot of artificial intelligence as well. So people are like, I'll just take that summary. And I'm not actually going to click over to the article that somebody took a lot of time to write to think through. I want the synopsis. And it's no wonder that folks are turning to artificial intelligence from money questions they have too. They're asking about saving strategies and debt management or even stock picking advice. And so I think generative AI can be a powerful tool. I'VE actually started using it a little bit more in my life, and it's been, I will say, helpful in moderation. But I think most people, they seem to be happy with, like the custom budget that ChatGPT, for instance, can create for them. But a recent Credit Karma survey finds that more than half of those who acted on the financial advice that they got from artificial intelligence, they feel like they ended up making a poor financial decision. That's a lot of people, Matt, to feel like actually it really let me down and I went in the wrong path because I took that answer. And so I think it's just important to be careful. I made a query of ChatGPT about 529 plans the other day. And because I know this stuff, I knew it was spitting out the wrong information. I knew it was incorrect about the tax deduction in certain states that you could get for making that 529 contribution. But a lot of people, they might be like, they might take that as gospel, stick money in, not realize that they are actually eligible for to contribute more and still receive more of a tax deduction. I think the effective use of AI actually comes from knowing the subject fairly in depth first. And if you're kind of turning over that learning process of personal finance and you're just assuming that whatever one of these AI spits out is going to tell you what you need to know, no prior knowledge needed first, I think you're. I think you're probably sorely mistaken. And you could end up in that 50% of people who says, yeah, it led me astray. I made some bad moves because of it.

[Matt]

That's right, man. Yeah. Proceeded with caution, folks. But we hope everyone has a fantastic weekend. That's going to be it for our, our Friday flight. Everyone enjoy your time out there. I feel like it's like the perfect time of year, perfect time of year for a, for a folk art festival, which I know that's what you got lined up.

[Joel]

It's basically my. It's like Christmas number two for me.

[Matt]

So Christmas in September, but we'll see you back here on Monday with a fresh ask how to money. And until then, best friends out. Best friends. There we go. See? Mind blowing.

[Joel]

Got it done.

[Frances Frey]

Hi, I'm Frances Frey. And I'm Anne Morris. And we are the hosts of a new TED podcast called Fixable. We've helped leaders at some of the world's most competitive companies solve all kinds of problems. On our show, we'll pull back the curtain and give you the type of honest unfiltered advice we usually reserve for top executives. Maybe you have a co worker with boundary issues or you want to know how to inspire and motivate your team. No problem is too big or too small. Give us a call and we'll help you solve the problems you're stuck on. Find fixable Wherever you listen to podcasts.

[Danielle Robaix]

Just like Great Shoes, Great books take you places through unforgettable love stories and into conversations with characters you'll never forget.

[Frances Frey]

I think any good romance, it gives.

[Matt]

Me this feeling of like butterflies.

[Danielle Robaix]

I'm Danielle Robaix and this is Bookmarked by Reese's Book Club, the new podcast from hello Sunshine and I Heart Podcast, where we dive into the stories that shape us on the page and off. Each week I'm joined by authors, celebs, book talk stars, and more for conversations that will make you laugh, cry, and add way too many books to your TBR pile. Listen to Bookmarked by Reese's Book club on the iHeartRadio app. Apple Podcasts are wherever you get your podcasts. Apple Books is the official audiobook and ebook home for Reese's Book Club. Visit Apple Co ReeseAppleBooks to find out more.

[Matt]

I'm Bridget Armstrong, host of the new podcast the Curse of America's Next Top Model. I've been investigating the real story behind that iconic show. I ended up having anorexia issues, bulimia issues by talking to the model, the producers, and the people who profited from it all. We basically sold our souls and they got rich. If you were so rooting for her and saw her drowning, why don't you help her listen to The Curse of America's Next Top Model on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. This is an iHeart podcast.