Friday Flight - Tax Tips, Wage Deflation, & Liberated From Low Prices #966

Summary

Podcast Summary: How to Money Episode: Friday Flight - Tax Tips, Wage Deflation, & Liberated From Low Prices #966
Release Date: April 4, 2025
Host: Joel & Matt
Produced by: iHeartPodcasts

---

Introduction

In episode #966 of How to Money, co-hosts Joel and Matt delve into pressing financial topics affecting everyday Americans. This week's discussion centers around tax tips, the implications of wage deflation, and strategies to navigate the challenges of rising prices. As always, Joel and Matt blend practical advice with engaging banter, making complex financial topics accessible and relatable.

---

Liberation Day and Affordable Prices

The episode kicks off with a humorous conversation about "Liberation Day," where Matt quips about feeling liberated from paying affordable prices. This segues into a broader discussion on how tariff changes and economic policies are impacting consumer prices.

Notable Quote:

Matt [02:13]: "From paying affordable prices. We'll actually get to all that here in a bit..."

---

Navigating Tax Season

With tax day approaching, Joel and Matt address common challenges listeners face when filing taxes. They highlight the IRS's backlog, especially for those in regions affected by natural disasters like California wildfires and Hurricanes Helene in the Carolinas and Georgia. The hosts emphasize the importance of filing extensions if necessary and caution against fraudulent tax practices.

Key Points:

• Filing Delays: Natural disasters and increased tax complexities have led to a decrease in filings compared to the previous year.
• Extensions: Advisable for those awaiting important documents, but reminders that extensions do not delay tax payments.
• Electronic Filing: Encouraged due to IRS staff cuts, leading to faster processing of refunds.

Notable Quotes:

Joel [07:21]: "Millions of folks are in the same boat as we are."

Matt [09:16]: "Make sure you file your return electronically."

---

Understanding Tariffs and Their Impact

Joel and Matt explore the ongoing trade war and the administration's reliance on tariffs as a solution to economic issues. They discuss the concept of comparative advantage and how tariffs can disrupt free trade, leading to increased consumer prices and challenges for American businesses abroad.

Key Points:

• Comparative Advantage: Tariffs often overlook the economic benefits of producing goods where there is a natural advantage, such as lower labor costs abroad.
• Consumer Impact: Predicts a loss of $3,000 to $4,000 in purchasing power for the average family.
• Business Challenges: American exporters may face retaliatory tariffs, making it harder to compete internationally.

Notable Quotes:

Matt [13:07]: "Milton Friedman called tariffs a protection against low prices, which we wholeheartedly agree."

Joel [15:01]: "The attempt to demonize free trade doesn't make a whole lot of sense."

---

Wage Deflation and the Job Market

Shifting focus to the labor market, Joel and Matt discuss the phenomenon of wage deflation, where companies are hesitant to offer higher pay even when employees switch jobs. They note that the post-COVID job market has shifted from a seller's market to a more competitive environment, making it harder to secure substantial pay raises.

Key Points:

• Gen Z Challenges: Younger workers face higher unemployment rates compared to millennials, hinting at a "Gen Z job recession."
• Stagnant Wages: Fewer opportunities for significant salary increases through job hopping.
• Economic Resilience: Emphasizes the importance of networking and maintaining strong personal finance practices to navigate potential recessionary pressures.

Notable Quotes:

Joel [19:01]: "Getting higher pay by swapping or moving to a different job was like shooting fish in a barrel in 2022."

Matt [19:36]: "Solid personal finance hygiene and networking are crucial for resilience."

---

Buy Now, Pay Later (BNPL) and Credit Scores

The hosts delve into the evolving landscape of Buy Now, Pay Later services, highlighting recent changes where companies like Affirm and Zip are starting to report BNPL activity to credit bureaus. This inclusion aims to provide a more accurate picture of consumers' creditworthiness but may also introduce complexities for users.

Key Points:

• Credit Reporting: BNPL data now factors into credit scores, aligning these services with traditional credit products.
• Consumer Awareness: Encourages timely payments to positively impact credit scores while cautioning against overuse to prevent potential score declines.
• Market Adaptation: Credit scoring models will need to adjust to incorporate BNPL data effectively.

Notable Quotes:

Matt [36:43]: "The dam has broken."

Joel [37:59]: "Buy Now, Pay Later deserves to be factored into your credit score, especially based on their popularity."

---

Technology and Second-Hand Markets

Joel and Matt discuss the rising trend of second-hand markets, particularly for smartphones, as consumers seek more affordable options amidst price hikes. They critique the inflated prices of new phones and advocate for purchasing refurbished devices from reputable sources to save money without sacrificing quality.

Key Points:

• Smartphone Longevity: Encourage consumers to hold onto their phones longer, citing Apple's robust support for older models.
• Refurbished Markets: Highlight platforms like Woot and Apple's refurbished offerings as cost-effective alternatives.
• Minimalist Technology: Suggest that reducing reliance on the latest technology can lead to significant savings.

Notable Quotes:

Joel [24:27]: "You're feeling ripped off by how expensive these phones have gotten."

Matt [28:23]: "Light Phone has jumped the shark with this pricing."

---

Innovations in Investing: Robinhood's Evolution

The conversation shifts to Robinhood's expansion into retirement advice and portfolio management. Joel expresses cautious optimism regarding Robinhood's new offerings, noting the potential benefits alongside concerns about the platform's additional services like margin investing and AI-based advice.

Key Points:

• Retirement Services: Robinhood's introduction of retirement accounts and portfolio management with capped fees.
• AI Integration: Upcoming AI-based advice tools raise questions about accuracy and reliability.
• Market Competition: Robinhood's innovations are pushing other brokerage firms to enhance their services, fostering a competitive investment landscape.

Notable Quotes:

Joel [34:06]: "It's a flashy launch, but there wasn't a whole lot of substance behind it."

Matt [35:07]: "Innovation, baby."

---

Home Improvements and Energy Efficiency

In a brief segment, the hosts touch upon advancements in home technology, specifically the introduction of high-efficiency glass windows. These innovations promise significant energy savings by improving insulation, which can reduce heating and cooling costs for homeowners.

Key Points:

• Energy-Efficient Windows: Modern glass technologies offer better insulation, potentially saving billions in energy costs.
• Long-Term Benefits: Retrofitting homes with these windows can lead to substantial reductions in monthly energy bills.

Notable Quotes:

Matt [31:04]: "This is the kind of progress that's going to have major ramifications on new builds and window replacement jobs."

Joel [31:25]: "Replacing crummy old windows with significantly better ones could reduce your energy bill by quite a bit."

---

Conclusion

Joel and Matt wrap up the episode by reiterating the importance of staying informed and proactive in personal finance. From navigating tax season and understanding the ramifications of tariffs to making savvy choices in technology and investing, the hosts provide listeners with practical strategies to enhance their financial well-being.

Notable Quotes:

Joel [38:07]: "Buy Now, Pay Later remains one of those things where I think people lose track of how much they're spending."

Matt [38:58]: "Something worth staying away from, especially if you don't handle it well or have too many outstanding loans."

---

Additional Resources

For more insights and resources mentioned in this episode, listeners can visit howtomoney.com. The show notes include links to articles on tax filing strategies, the impact of tariffs, and tips for managing Buy Now, Pay Later services effectively.

---

Note: This summary excludes promotional segments and advertisements to focus solely on the episode's content. For promotional offers mentioned by sponsors, listeners are encouraged to tune in directly to the podcast.

Transcript

[Matt]

Joel, we've all got different tasks in life that we enjoy doing. For me, that would be closing out the books on our family's personal finances every month. Nerd. But then there are some chores that are more of a pain. And for me, that would be grocery shopping, something I try and avoid if at all possible.

[Joel]

Well, that's where Walmart steps in, because their subscriptions help you to stay stocked on the items you use most, whether that's milk and eggs or kitty litter and cleaning supplies for. Find everything you need for your home at Walmart, in stores, online and in the app. Almost all of us have got old stuff that we should be tossing out, but an old 401k? Make sure it keeps working for you. A Fidelity Rollover IRA has no account fees or minimums to open. An easy to follow rollover process makes it simple to get started in under 15 minutes. Plus you'll have access to a rollover specialist.

[Matt]

That's right, whether you've switched jobs or are just organizing your finances. Learn [e-mail] rollover consider all your options and the applicable fees and features of each before moving your retirement assets. Fidelity Brokerage Services, LLC Member NYSE SIPC.

[Joel]

Where do you see your career in 10 years? What are you doing now to help you get there? The sooner you start enhancing your skills, the sooner you'll be ready. That's why AARP has reskilling courses in a variety of categories like marketing and management to help your income live as long as you do.

[Matt]

That's right. AARP has a bevy of free skill building courses for you to choose from. Because the steps that you choose to take today will help you to love what you do in the future. And that's why the younger you are, the more you need AARP. Learn more at aarp.org skills welcome to how to Money.

[Joel]

I'm Joel.

[Matt]

I'm Matt.

[Joel]

Today we're talking tax tips, wage deflation, and being liberated from low prices.

[Matt]

Of course, we gotta touch on Liberation Day. Joel, how do you feel liberated? I do. I do. Yeah.

[Joel]

From what?

[Matt]

From. From paying affordable prices. We'll actually get to all that here in a bit, but this is our Friday flight buddy, where we tackle the most pressing headlines and specifically how they're gonna impact your money.

[Joel]

And there was some news this week.

[Matt]

Oh, there was? Absolutely. Before we get to all that, though, real quick, I wanted to mention a quick shout out to Caitlin. She was listening to a recent episode and heard us talking about radon. And she actually, it was funny. She emailed and she's like, how to hit pause and reach out to you guys. Because radon entered the chat, but we were mentioning a listener had reached out and was talking about some remediation. I guess he's gonna have to install some stuff at the new house that they were purchasing, including a radon remediation device, I guess, like event fan, that kind of thing. And we kind of touched on how we didn't really know much about radon. Well, I know a lot more about it now because Katelyn informed me and I can't remember if she mention this in the email or if this was a part of my deep dive, but radon is a radioactive substance. It's. It's a radioactive gas or I guess.

[Joel]

Frightening or like it's gonna turn me into a superhero, one of the two.

[Matt]

Like Spider Man?

[Joel]

No, but it actually can cause lung cancer.

[Matt]

It causes lung cancer eventually. And that's. I think that's the big time, is that a lot of times it's not seen as this pressing issue. But yeah, like you live in a house and you got radon coming up through the ground underneath. It gets getting trapped in the. Maybe the crawl space is entering into the house and it can cause issues. I looked into it, saw that you can buy like a $15, like one time use test kit, or if you like the data, they've got these little monitors, these little readouts, and you can put that in your basement and kind of see how maybe the levels might fluctuate, might give you a better picture. But just search wherever it is that you live and whether or not radon is more or less active in your area. Because turns out where we are, there are these different hotspots. And the closer you are in particular to like the mountains, it seems that there are higher levels of radon. And that's actually pretty descriptive of where we live, Joel. So I'm going to look into this. All right.

[Joel]

Yeah, good psa.

[Matt]

Nice little tip.

[Joel]

Yep, for sure. All right. I want to mention one other thing real quick before we get to all the stories, Matt. My daughter is in this like manners class, which is kind of goofy. I never remember those. I never thought we would partake of that cotillion, but.

[Matt]

Is that what it's called?

[Joel]

It's. It's not called that, but yeah, that's basically.

[Matt]

That's what it was called when I was in middle school.

[Joel]

Did they send you to one?

[Matt]

Of course not.

[Joel]

Okay. I was gonna say I haven't seen the fruits of that.

[Matt]

You've seen how I treat People, Joel.

[Joel]

I've seen how you eat.

[Matt]

I use the wrong fork all the time.

[Joel]

That's the salad fork, man. Well, so she had to get some fancy dresses for these classes because she's, like, learning how to dance with boys and all that stuff.

[Matt]

That's how it goes, man.

[Joel]

That's the point we're at in our lives right now. Well, Emily and Selma, they went to the thrift store to get some new dresses as. I mean, smart move, right? And the one thing she was. She found some really beautiful dresses. She was super stoked about it. The one thing she was nervous about was, wait a second, Is that gonna be totally uncool that I got my stuff at the thrift store?

[Matt]

Nobody's gonna know.

[Joel]

Well, she told her friends, hey, I got my dress at the thrift store. And they thought she was the coolest, that she got her dressed at the thrift store. And so for folks who are out there and you're worried, you're like, are people gonna judge me, Dude? People are gonna think if you get something cool, and then you also, on top of that, got it at a significant discount because you got it at the thrift store, and you didn't, I guess, buy it from a retailer who's, like, has to manufacture that. You're reusing something. People just give you extra street cred.

[Matt]

Third store has always been cool. I remember going to the. To this thrift store when I was in high school. And I don't know if it's just how we view the world. Maybe we're just not a part of the group. Joel. That makes the thrift store is uncool, but the thrift store has always been cool. And this is. This used to be a knock on living in the burbs. The fact I remember thinking when we moved up here that I was just like, man, nobody puts out. Nobody does a curb alert. There's not cool stuff out on the street. But it's because they're donating it all to Goodwill. You've got this third party that's gone through stuff to make sure it's up to snuff. And then you get to show up. They've curated it for you, and then you show up. And our oldest, she. Are all Nikes called Air Force Ones now. I don't really understand.

[Joel]

I don't think so. But I think those are the popular Nikes.

[Matt]

I thought it used to be just a singular shoe, but now it seems like, I don't know, a line or something. Yeah, like, all those shoes are air Force.

[Joel]

Maybe like the Jordans, where there's a line of them now probably.

[Matt]

I guess so. But she picked up a pair of like these dope seafoam green Nike high tops.

[Joel]

Cool.

[Matt]

That are like, I think 100 bucks or over 100 bucks. Brand new.

[Joel]

Wow.

[Matt]

For kids shoes. She picked them up, man. They're basically brand new for $8. They're so cool. I love them.

[Joel]

What parent in the right mind would spend, I don't know, 30 figures on shoes when your kid's going to outgrow them in like a week?

[Matt]

It's insane. It's so all that to say, I'm all for thrift stores, man. We certainly need more of that in our life.

[Joel]

And I think it's good to teach your kid to own it. Like, just be like, yeah, got this at the thrift store. And people will show you mad respect for that. All right, Matt, let's talk taxes. Tax day is almost here. We're gonna get to tariffs in just a minute. But millions of Americans, including myself, haven't actually filed yet. I think you just filed your taxes. No. You're almost there.

[Matt]

Yeah.

[Joel]

Okay.

[Matt]

I've given.

[Joel]

So you and I are both included in this number.

[Matt]

Yeah, I've given my information same weeks ago, but they're just. I think they're pretty backed up.

[Joel]

I personally was waiting on a couple last minute documents. My last one didn't come till March 20, so I was like, okay, I might. I might be filing an extension, actually. Kind of like we talked about with Jasmine earlier this week. Well, the IRS reports that filings are down this year compared to last year, which means tens of millions of folks are in the same boat as we are. Matt, they've got some work to do this weekend or next if they really want to punt to the last minute. One possible reason, though, for this is because millions of folks live in an area impacted by a natural disaster, California, by the wildfires. If you live in Los Angeles county, there are parts of North Carolina, South Carolina, Georgia that were impacted by Hurricane Helene. Those populations also have. They don't have to file until the fall and they don't incur a penalty by delaying. I think another reason, though, is the greater complexity that people tend to face these days and their taxes. Yes, there's the higher standard deduction, but there's also a lot of side hustles and day trading, just kind of investment schemes that people are participating in as well. So I think that might be part of the reason that some folks are waiting. It's like they got to get all their documents in order. And it takes a little more time these days.

[Matt]

I think a lot of folks are trying to figure out what documents they actually need to have in hand before they can file as well. It's sort of like, yeah, there's a learning curve. And you mentioned filing for an extension, but that even if you do file for an extension reminder, that doesn't mean that you can wait to pay your taxes if you owe. And if you can't afford to actually pay your tax bill, well, make sure to file anyway, because, yeah, failing to pay on time, that's gonna prompt some stiff penalties, but so will failing to actually file. Two wrongs. Don't make it right here. At least do one of them. By the way, there have been staff cuts at the irs, so it's a good idea, as always, to file your return electronically.

[Joel]

Oh, I thought you were gonna say file a fraudulent return that claims a lot of money back because they're not gonna audit you now.

[Matt]

They're not gonna catch you. Actually, I think that's the advice that Joel's recommending. Matt's.

[Joel]

No, but I am.

[Matt]

Matt is not recommending that advice. Irs, go after Joel.

[Joel]

Send your angry emails to me.

[Matt]

But when you file electronically, the refunds are being processed really quickly if you go that route. And some good news, I guess, is that the average return. I'm sorry, refund. Is higher than it was last year. It's more than $3,200. Make sure you use it wisely. I'm optimistic that I might be receiving a refund. My cpa, the accountant reached out, and they said, hey, if you get a refund, you want to go ahead and do a direct deposit into the checking account ending and blah, blah, blah, blah. I was like, of course. Just got me thinking. There's a chance I may not owe this year. So that's good.

[Joel]

All right. Well, yeah, that is fun. Although you dial it in pretty close, so the refund's probably going to be minimal. And that is typically the best advice, but. What?

[Matt]

Well, I'm just. Yeah, yeah. There's a reason, though, that I'm thinking that I might owe a little bit more this year because I failed to do something last year.

[Joel]

Okay.

[Matt]

That we won't get into here on the show.

[Joel]

Okay. Well, yeah, maybe we'll do a deep dive on your taxes specifically at some point. But, yeah, the truth is, most people do get a refund, and that is kind of. It's like your, once again, a year opportunity to make a massive dent in your Personal finances. We'll link to an article in the show Notes about how you can use your tax refund wisely. Check that out. One tax and investing move you can still make, by the way, Even though it's 2025, not 2024, is to contribute to your Roth IRA for last year. It's one of those few things, right, that you can still partake in from the prior year. And you always want to fill up that bucket right before you start contributing to your 2025 Roth. So if you didn't fill it up and you've got, you're like, I got some extra cash on hand or I'm, I know I'm going to get a big return. I want to maximize my Roth from last year first. Great, go for it. And there was recent data from Boston College which found that young folks are flocking to Roth IRAs in general. They're just kind of like Hansel in Zoolander. They're so hot right now. And we obviously, we love this map because it's not just that we're pumped to see Gen Z investing. We are, but, but also because if you're in your twenties, your, your income is still likely ramping up. You haven't reached those peak earning years.

[Matt]

Exactly.

[Joel]

So opting for the Roth IRA instead of a traditional paying the tax now future you is going to be so thankful. I just think about those earliest years of working, how little I was making. And so every dollar that went into the Roth was so dang smart because my tax bill was almost non existent on the money that I was sticking into my Roth. Yeah, I was paying the tax now, but I was paying tax at such a low rate. So young people and Roth iras, they just go hand in hand.

[Matt]

That's right. So did you watch the presidential address from the live this past Wednesday?

[Joel]

I caught a little bit where you held up the poster and. Which is just kind of a fun image.

[Matt]

Kind of feels like giving a presentation like in high school sort of thing.

[Joel]

I'm surprised it wasn't on a trifold board.

[Matt]

That would have been the icing on the cake. Of course. The President's continued belief that tariffs are the solution to basically every human problem. That continued with the announcement. Are you depressed? Unprecedented array of widespread terrorists, Man. The thing is, and we've talked about this, this ramped up trade war is going to harm everyone. American businesses. They're going to be at a disadvantage internationally assuming there are reactionary tariffs. And they fail, generally speaking, to take into account just many classic economic realities like Comparative advantage. Think about all the things that are produced abroad in different countries where maybe there's more affordable labor. A desire to produce pencils or plastic cups, things that we don't necessarily want to produce here in the United States.

[Joel]

Just try bringing banana and avocado production into the United States.

[Matt]

That's the silliest part. Tariffs on items that we can't even produce, like coffee, for instance. Milton Friedman, he called tariffs a protection against low prices, which, man, we wholeheartedly agree. And it's not surprising to see that consumers are already dialing back their spending, at least their discretionary spending, increasing their savings. They are, quote, unquote, preparing for a rainy day, which is smart, because Yale Budget Labs, they predict that the average family will lose an extra 3 to $4,000 in purchasing power. That's a lot of money, man. And cheap stuff is not. It's not the only part of the American dream, but it is not an inconsequential part of it either. And of course, this is assuming that these terrorists stick around, right? Like, there's a part of me that's just holding my breath and waiting to see how long before these are either walk back or other countries are where they say that, hey, we don't want to play this game. Right? Like, this is the, the best case argument for terrorists, right? Where it's a political move, where they're going to blink first, where they're not chicken. Exactly, yeah. Where they're almost. It's like an economic nuclear war almost, right. Where it's like, all right, we've got these other countries and they've maybe been poaching around the edges of the, around the border a little bit. But this is, this is an entirely different ball game. And hopefully we do see some, some countries start to walk that back. It's a tit for tat. And we see tariffs significantly decrease over time. Like, that's, I think, the best case scenario, right? Because you can't industrialize a country overnight. But you can say, oh, yeah, we're not going to do those tariffs anymore. That is something that can happen overnight.

[Joel]

And even if we did bring back some of that industrial production that I think the White House is hoping for, that doesn't necessarily mean low prices either, because can you imagine how much it's going to cost to build the factory and manufacture an iPhone here on US soil? We're not going to be cheap.

[Matt]

We have high wages here in the.

[Joel]

US which is great. And we also have fairly inexpensive goods because of free trade. I think the Attempt to make free trade, to demonize free trade. I get where it comes from, but I think that it doesn't make a whole lot of sense and consumers are going to feel the pinch pretty quickly on all sorts of goods in not very long. And I do think that. Yeah, we'll see. I mean the stock market obviously didn't react well yesterday either.

[Matt]

Yeah, it reacted immediately, whereas I don't.

[Joel]

Know that I've ever seen that steep of a drop in that short of amount of time.

[Matt]

Oh, do you remember Covid, was it.

[Joel]

Was there a 10 hour blip where stocks were dropping by 4 or 5%.

[Matt]

Once it was announced as like a global health crisis, an actual pandemic? Man, things got freaky real quick.

[Joel]

They did. That's true.

[Matt]

Either way, I think everyone is praying for tariff de escalation essentially is what I'm hoping for.

[Joel]

I agree. And we will continue to monitor, keep our finger on the tariff pulse, as it were.

[Matt]

Tariff defcon, you know, like we're up to three, four or. I don't. It's backwards. Like it feels like we're at 2 right now. Like it's, it's actually about to seriously impact the globe and hopefully we can back that thing down.

[Joel]

The announcement was like tariff blinking lights for sure. And so I think, yeah, tariff vigilance on behalf of individuals, it's more, it's more of a necessity right now. Right. And UPS is making it easier to see the impact of tariffs on your purchases as they're becoming more widespread, more international deliveries are coming with like an unexpected bill attached for unpaid import costs. And so UPS has this new global checkout that they, that they launched and it's automatically adding the cost of tariffs in for shoppers buying from overseas companies who are subject to tariffs, which is going to be more necessary right now. Like it's going to be really frustrating to get a bill after the fact if you bought the thing and you didn't realize that there was a tariff attached that for some reason wasn't paid for by the company sending the good into the United States. And so, you know, we wish this solution wasn't necessary because that would mean that tariffs weren't a reality in the way they're currently existing. But it's, I don't know, kind of cool. There's some transparency on that front. Sure. And more needed transparency. By the way, one thing we didn't really talk about on tariffs, Matt, is that this is also going to impact American companies sending goods to other countries if there are retaliatory Tariffs. So.

[Matt]

Oh yeah, I mentioned the reactionary tariffs.

[Joel]

It's like two, two can play at that game. Well, that's why we're doing it. But then, yeah, when you think, just think about what that's going to do to American businesses who send a lot of goods overseas.

[Matt]

Yeah. Well, as prices go up, that means we as consumers need to pay a little bit more attention to our personal spending. And we've been saying this for quite some time because of inflation, but Bloomberg, they just published a piece about the importance of individual action to cut down on your own rate of inflation. And I think depending on how you view the world, maybe the side of the political aisle that you're on, it can be tempting just to throw your hands up and just talk smack about our elected officials. And there is certainly a time and place for that. But it's also really important to remember that despite policy changes that we have no control over, there is still a lot that we actually do have control over. And so the moral of this article is pretty simple, which is to shop around. And I can see no better way to cut your spending than spend more time at the thrift store.

[Joel]

Joel? Yeah, yeah, that's a good point. Like, I think there are some ways in which we're just going to grin and bear it. We're just going to take it on the chin because they're necessary items that we, we can't afford to not purchase. And then I think there are other ways in which we companies are going to be doing the same thing, right? They're going to be pivoting to where they source their goods from. And we can do the same as individuals. We can pivot to where we're buying from. And yeah, buying secondhand, keeping some things around longer might become a necessity for some folks and might just be a savvy way for people to save more as individuals too.

[Matt]

Even just bringing up the the pandemic reminds me of how different our world is now from just a few short years ago. We've seen just incredible changes to interest rates, to housing costs, to inflation, basically to everything. And we all remember the increased power that fell into the hands of job seekers back a years ago, like back in 2022, 2023. Well, now there are some stats that are showing that many job seekers are experiencing wage deflation. More companies are hesitant to make new hires, which means job switching is not going to net you any more pay. And in fact, it might even net you less pay were you to go with a new company these days as opposed to Staying put. So this is not a hard and fast rule, obviously, but we a couple weeks ago, we recently talked about getting the job you want with Madeline Mann. And so if that's not an episode that you happen to ca, we'd recommend going back and checking that one out.

[Joel]

Yeah, getting higher pay by swapping or moving to a different job was like shooting fish in a barrel in 2022. And we heard from so many listeners. Right. Who made out like bandits during that time. They're getting a sick race. Right. While the getting was good. I think part of that was just people took the stimming money and they said, I'm not going to work as much these days. And so there was just a constraint, a lack of supply of workers to fill some of those jobs that employers needed. And there was also people were buying more stuff. And so like the economy was humming and that shortage of workers just, man, that power in your hands felt so good. But there was just no way the post Covid job market could last forever. It's obviously not impossible, but it's just going to be more difficult to pull that off in today's job climate to get that heist of a 30% raise that you were able to get a few years back. Sadly, Matt, there was recent stats too. We're seeing higher levels of unemployment for Gen Zers, especially when compared to their millennial counterparts. Gen Z. I think they might be going through something similar to what millennials went through in the Great Recession. Not quite as bad, but at least akin to kind of what millennials experience. Some are calling this a Gen Z job recession. I don't know if it's quite that bad yet. But in a tighter job market with more competition and less ability to increase your income and then kind of tremors of a recession potential, it's even more, I think, important to tend to your network and to have solid personal finance hygiene. Both those things in combo are going to help you be more resilient, given whatever comes down the line.

[Matt]

All right, we've got more to get to during our Friday flight today. We might even talk about Joel, how gorillas might be able to save you money every single month. We'll get to that more right after this. Asking the right questions can greatly impact your future, especially when it comes to your finances.

[Joel]

So if you're looking for a financial advisor you can trust, certified financial planner professionals are committed to acting in your best interest. That's why it's gotta be a CFP. Find your CFP professional at letsmakeaplan.org so.

[Matt]

One aspect of owning your own business that some folks don't think about is setting aside money for taxes. It's a hassle if you forget about it, but you just gotta think ahead some. You gotta make those quarterly estimates, then it's no big deal. Similarly, Trust and Will makes creating your will easy and time efficient. Get you thinking ahead, which is good, but then you can focus on other important tasks. Their website is incredibly easy to use and it's tough to beat knowing that I have the peace of mind, that my wishes are secure, and that Kate and the kids are taken care of.

[Joel]

Yeah, I love knowing that Trust and Will is designed by attorneys, but it's kind of customized by me. Each will or trust is state specific, legally valid, and customized to your specific needs. Think about how difficult this necessary task used to be. Well, estate planning, it's easier than ever these days thanks to Trust and Will. It's so easy to get started and it's been used by hundreds of thousands of families and counting.

[Matt]

That's right. Uncomplicate the process with Trust and Will. Protect what matters most in [e-mail] HowToMoney and get 10% off. That's 10% [e-mail] HowtoMoney I think back to the early days of the podcast, Joel, and we very quickly realized that we needed an episode called the why behind you'd Money. And that's because we knew that we wanted listeners to take a step back from the day to day money saving and investing tips and instead to think over a longer period of time. Essentially, we wanted folks to plan for their futures and to get really specific as to why they were attempting to be savvy personal finance nerds and protecting your family by securing their future with life insurance from Policy Genius. That is a perfect example of doing this well.

[Joel]

That's right. Yeah. With policygenius, you can find life insurance policies that start at just $292 per year for $1 million of coverage. Some options are 100% online and let you avoid unnecessary medical exams. And Matt, how do Money listeners have used policygenius to snag coverage and they've told us what a great experience it's been and the peace of mind that they achieve afterwards. It's priceless. But it's not just them. Join thousands of happy Policy Genius customers who left five star reviews on Google and trustpilot.

[Matt]

Secure your families tomorrow so you have peace of mind today. Head to policygenius.com to get your free life insurance quotes and see how much you could save. That's policygenius.com.

[Joel]

All right, we're back. Matt. Gorillas, you got me on the edge of my seat.

[Matt]

Maybe I wasn't being entirely truthful there when it came to that tease. You liar. That's why it's called a tease, though, and not the actual story.

[Joel]

That's right. We'll do that in a second. Let's get to the ludicrous headline of the week, though. This comes from the Wall Street Journal and it reads, feeling ripped off by thousand dollars phones. The second hand market is taking off. And yes, yes, Matt, I personally am offended and taken.

[Matt]

You're feeling ripped off, Joel, by how.

[Joel]

Expensive these phones have gotten. I'm on a new phone buyer strike. I'm on a mission to make mine last as long as humanly possible.

[Matt]

You know what, you can do that with an iPhone because the build quality is so much better. You've got to admit that at this point, you're right.

[Joel]

And the other thing, and we've talked about this before on the show, is that Apple supports their phones longer than Android does, than Google does. Right. So just the fact that like my daughter has an iPhone 7 that was gifted to her by her grandma that we keep at home, she barely uses, but they just stopped supporting that at the end of last year. Yeah. So it's one of those things where they finally bricked it. That's a seven. Think about how long ago that was that came out.

[Matt]

I don't even know when that thing came out.

[Joel]

Probably eight or nine years ago is my guess.

[Matt]

That's amazing.

[Joel]

Right? So, yeah, but I will say this. I think a lot of people are going on new phone buyer strikes. You can, you can see that in kind of the age of the average handset that people have, phones are the.

[Matt]

New car, like they're only getting older and older. The ones that are out there on the road in a similar way. Yeah. Maybe we should be considering used phones just like we consider used cars all the time.

[Joel]

Maybe a secondhand phone. Right.

[Matt]

Love that.

[Joel]

Because especially it's like the flagship prices have gone up. The budget devices have also gone up. We talked about that when iPhone Apple announced, excuse me, the 16E. Right. And it's like that was way more expensive than the SE that they had released as a budget phone.

[Matt]

So it's a $600 phone.

[Joel]

Right. It's not a budget phone anymore. They used to be 350 to 400 bucks, which is why I used to go with the Pixel versions. The Dumbed down pixel versions because they were really good and they were like 350. But that's not the case anymore. And so yeah, I love to see that people are holding onto their phones longer. Especially we talk about the lack of innovation. Although there's a counter argument that coming in a second in the cell phone space, that's another reason just to not upgrade. Especially when I'm hearing all the bad reviews about Apple's AI in their newest hands it's like it's not that great. It's, it's over, it's overblown and so you probably don't need that either. So paying instead of paying, I guess twelve hundred bucks for the newest iPhone, you can get something of almost equal ability like the iPhone 14 or something like that. Go back a couple generations and you can get that for like 500 bucks instead. I was even, man, I've seen some refurb models on Woot for roughly that price and yeah, less than half price. That's what I want to sign up for.

[Matt]

Well yeah, I mean that's specifically because Woot offers a 365 day repair or replace warranty on the refurb phones that they sell. I made the mistake of purchasing a refurb. A refurbished. I don't like saying refurb. That's a weird word. Refurbished. That sounds way better. A refurbished phone from ebay. They did not. It's not, I mean it was presented, it wasn't presented as a refurbished phone. So that's the problem. And then they're making repairs to it and they're not watertight. As opposed to buying a truly refurbished phone from let's say Apple where it still has a one year warranty and it's up to factory standards. And that's a good phone price for the battery too.

[Joel]

They do additional things to their refurb phones, but then again, the price you're gonna pay for a repurb phone at Apple versus a place like Woot, it.

[Matt]

Is gonna be a bit expensive. But I also like the idea of having a dumber to just prevent me from becoming my own worst enemy. Doom scrolling until I die, basically. I wanted to mention the light phone. That's been a good option on that front. And they just released this new model this past week. It too is way overpriced at $800. I think for a limited time they're offering it for six for 600 bucks. But on top of that, the company's proprietary service, like the plan, well, it costs you $30 a month. Not surprising. You only get one gig of data because that's all it probably takes to run a light phone. But even $30 a month, man, that's way more than what it is that you and I are spending. Like, I am all for limiting tech to live more IRL life, but not at that price point. If you're going to pay that, if you want a dumb phone, just go back and get a basic flip phone.

[Joel]

Exactly.

[Matt]

It feels like light phone has jumped the shark with this pricing. And it just highlights how there aren't new products that are needed to solve old problems. Right. It's just like, oh, I got this problem where I'm on my phone, or oh, instead I need this new shiny, sexy product that's going to solve this old problem as opposed to kind of going back to what it was like before you had that problem, which is an older phone or even just limiting. Honestly, it reminds me of folks who are wanting to go for more the minimalist lifestyle or clothing aesthetic and they think, oh, I need to buy. I need to go with one of those companies that sells all the kind of minimalist looking clothes, you know, where everything's like solid colors and the colors aren't very vibrant. Maybe some stripes, the occasional stripe. But you don't have to do that. All you need to do is first toss out half the clothes in your actual closet, find the items that you love the most that you can pair with lots of other clothes. Boom, you've got yourself a capsule wardrobe. That's what that's called. You don't have to go out and buy an entirely new product. In a similar way. I think there's a way that you can do that when it comes to technology, like your phone. I for lent, I gave up social media, specifically Instagram, because I didn't like how much time that that was draining out of my life. Guess what I don't need to do is go out and buy an $800 phone.

[Joel]

You just delete the app.

[Matt]

I just delete the app. And I think it's something I'm actually hopefully going to be able to maintain even after the Lenten season. But yeah, you don't need to spend money to solve your problems.

[Joel]

You make a great point. Well, let's talk about gorillas, though. Matt, you hinted at this. Do you want to talk about.

[Matt]

I feel a little bad about the gorilla. It was a gorilla glass.

[Joel]

Yeah. Okay. Why don't you tell us about how Apple's like all. The one thing that Apple has done incredibly well is work with Corning to innovate on glass, which has been great for your iPhones. It means that, you know, the iPhone you got. When was it starting with the 12 or 13 that the more unbreakable glass kind of came into being?

[Matt]

Yeah, so the glass was always the gorilla glass, I'm pretty sure from the beginning. But, yeah, starting with the 12 is when they did the ceramic shield. Like, that was like the next level of hard glass.

[Joel]

So now it's like, harder to.

[Matt]

It's even harder. Exactly. So basically what I'm saying here, from a phone standpoint, personally, at least, I wouldn't go past anything older than a 12. But hey, if you do, I bet you are would be able to get a really sick deal. But when it comes to home improvements, the hard glass that's out there is being translated to new windows for your home, which could save Americans billions of dollars annually on energy costs. These new windows, they now have a better insulation value than your Wal, which is crazy. Like, typically, windows are the. It's like the weakest link when it comes to energy loss.

[Joel]

They're like at least 20% worse than your walls. But the windows we've got here in our little studio clubhouse thing, Matt, they're probably much worse than that.

[Matt]

It's amazing. This is the kind of progress that's going to have major ramifications on new builds, window replacement jobs in the coming years, and it's just going to be able to save individuals a lot of money due to the fact that they're spending much less on heating and cooling their homes.

[Joel]

Yeah, that sort of progress gets me really excited, especially when we talk about the potential for energy shortages, which I think have been overblown. But when we talk about just making things far more efficient and retrofitting buildings to ensure that they reduce energy loss, that is a huge bright spot on the future. And seeing that, like, innovation in windows, that's something like, I wasn't really thinking much about. And then you read about that and you're like, holy crap. Like, that could have such a massive impact as people do over time, replace crummy old windows. And they put in not just slightly better, but significantly better windows. That could roost your energy bill by quite a bit. All right, let's talk about your favorite investing firm, Matt Robinhood. They. They're kind of still trying to be big Boy. I think they're. They've been.

[Matt]

They're totally big boy.

[Joel]

They're big Boy. But, like, they started as mostly a day trading app, and they have, over time, evolved in Their services offering retirement accounts. And now they just announced this past week that they're going to offer retirement advice. And so the fee, similar to what other robo advisors like Betterment charge are kind of getting into this Robo advisor space. They're charging a quarter of a percent, but that fee then is capped at 250 bucks a year for Robinhood Gold members.

[Matt]

Yeah, that's good.

[Joel]

Which I think is cool. I kind of like the idea of the fee cap. Like, hey, yeah, it's a quarter of a point, but after you have a certain balance, we don't charge you anymore. A good explanation of the methodology of the Robinhood portfolio management, like how they're doing this though is lacking. I just feel like I didn't see enough information about how they're planning on implementing this. Although they're saying that this is actively managed and that can include individual stocks. But what it doesn't include, of course at that cut rate price, is personal advice. I think for now. I don't know about you, I would say the jury is out. We need more information about what this sort of Robinhood offering is going to look like. It's like a flashy launch, but there wasn't a whole lot of substance behind it. I think the thing I am most nervous about though is Robinhood's another announcement upcoming launch of AI based advice, which is supposedly going to explain to people as you're on the app why the stock, a specific stock is going up or down and that it's not always straightforward. Right. So like is the AI going to be right on that? Is it going to give me good advice or is it going to be way off base? I don't know. Uh, so some of the ways Robinhood is changing are positive for customers. Others like that, like the trading and betting on future events, that worries me. So there's yeah, kind of the grown up Robin Hood and then there's still the juvenile Robinhood, I think where I just kind of don't know which one I'm getting. And if you're going to go with Robinhood, you just got to make sure you have the behavioral fortitude to do the basic stuff.

[Matt]

I think that's always the case and that's what I was going to point to. Right. Like the fact that they're offering this portfolio management and they've got these AI tools. They're just trying to give people what it is that folks seem to think that they want. Right. There are some things that like their match the fact that they have a non employer Retirement match is amazing.

[Joel]

The first of its kind.

[Matt]

Freaking love that. But then also when I log into the app, I also see little banner that says, hey, are you interested in margin investing? I hate that, but it's terrible. But it's at the same time, though, it's what it is that people are coming to expect from their brokerages. But that doesn't mean that you have to participate. It makes me honestly think of because, like, they've got so many different things, so many different options. Anything your heart might desire. Joel. It feels like, like wall. Like Robinhood is almost like Walmart here, where. Yeah, they've got some amazing stuff. They've got like some. Some great affordable organic produce that feels like the 3% Match for Gold members when it comes to their IRAs. Right. You're like, yeah, that's the good stuff. But guess what else? Walmart sells, like Doritos and Coke.

[Joel]

Yeah. To me, that's shelves and shelves of junk food.

[Matt]

Yes. Like in the center of the aisle. Like, that's the kind of thing that feels more like margin investing or AI advice. It's like, could you do without? Well, absolutely. Is it something maybe occasionally you want to take a peek at? Sure. You kind of take the good with the bad, but in this way, ultimately, as personal finance enthusiasts, it does come down to us as individuals and the decisions that we make, they continue.

[Joel]

The one great thing about some of this Robinhood innovation is I think they continue to push the envelope and they're causing other brokerage firms to have to react in kind to step up. Right.

[Matt]

Innovation, baby.

[Joel]

We've seen other great brokerage firms kind of follow Robinhood's lead on the match. Betterment implemented a match after Robinhood did it, which is cool. So I'd like to see that maybe there are innovative ways of thinking that could benefit some of their customers. Well, it's also not limited to Robinhood, then. Other firms are getting in on the action.

[Matt]

Yeah. Okay, let's talk about Buy Now, Pay later, because those companies out there are going to start to report to the credit bureaus. This is a sector of the market that's grown to be a significant piece of the consumer lending industry. So it makes a ton of sense that those cleverly disguised loans would be factored into your credit score. I honestly can't believe it's taken this long, especially given the data that we have about how heavy Buy Now, Pay later users tend to be higher credit risks. So affirm. They started furnishing data to experian last Tuesday. TransUnion they say that they're already working with two buy now, pay later companies as well. I'm sure more are going to follow soon.

[Joel]

The dam has broken.

[Matt]

Credit scoring models are going to have to be tweaked in order to include this BNPL data in their models moving forward, or they're likely going to be treated like other forms of debt. In particular, I mean, credit cards, but also car loans, because they are more like installment loans. It's unlikely these changes are going to cause big credit score swings. But maybe it might because for, for some, I think it might because in a way it almost feels like this thing that has been ignored, like where folks have like stuck their head in the sand and it's like when you, if you know that you've. Your shower's been Lincoln leaking and it's like, oh, I know that there's probably some rotten under there. Maybe, I don't know, maybe the subfloor is kind of getting a little soft. But you don't really fully know until someone gets in there and kind of like peels it back and you're like, oh, wow, that's like all the way down to the floor joists.

[Joel]

I didn't fall through.

[Matt]

There's a lot of damage here. And I don't like that. The credit bureaus are kind of the arbiters of your credit worthiness, but somebody's got to do it. Like, somebody has to be able to wrap their head entirely around an individual's credit worthiness, how much debt they have on hand, because there's a lot of individuals who haven't, you know, again, they haven't really been paying attention. But for those who have been paying attention, I think the big takeaway here is that if you pay your Buy Now, Pay later payments on time, that's going to help your credit score. It's a good thing.

[Joel]

And clearly these deserve to be factored into your credit score, especially based on their popularity. I could see how five years ago, like, they were just, they were small.

[Matt]

Potatoes and so there's more of a novelty.

[Joel]

There was no necessity. Yeah. And I think I mentioned this on the show before. I've only used Buy Now, Pay later once and it was only because there was a discount offer like 50 bucks off if I use Buy Now, Pay later and then I paid it off instantly. So Buy Now, Pay later still remains one of those things where I think people lose track of how much they're spending. You can grubhub your burger on it now. Like we talked about recently, it's just something worth staying away from, especially if you don't handle it well or you have too many outstanding loans. Well, how's that going to factor into your credit score? It could cause it to drop at least by a little bit if you're not handling those Buy now, pay later payments well. Or if you're just overdoing it on Buy now, pay later in general, just using it indiscriminately. All right, Matt, that's going to do it. For this episode, we will link to some of the articles that we mentioned up in the show Notes on our website howtomoney.com but until next time, Best friends out.

[Matt]

Best friends out. Joel We've all got different tasks in life that we enjoy doing. For me, that would be closing out the books on our family's personal finances every month. Nerd. But then there are some chores that are more of a pain, and for me, that would be grocery shopping, something I try and avoid if at all possible.

[Joel]

Well, that's where Walmart steps in because their subscriptions help you to stay stocked on the items you use most, whether that's milk and eggs or kitty litter and cleaning supplies. Find everything you need for your home at Walmart, in stores, online and in the app. Even if you're a money whiz, it can still be helpful to have some professional backup and advice. I talk about personal finance every day of my life and I was still able to get massive value chatting with a CFP from Domain Money. They analyze every aspect of your financial life and help you build a personalized plan with clear steps to reach each one of your goals.

[Matt]

That's right. And for a limited time they're doing free 30 minute strategy sessions. So start today by booking a free strategy session with one of their experts by going to domainmoney.com howtomoney I am.

[Joel]

A current client of Domain Money. I received a financial plan as part of the compensation for Domain Money's advertising on the podcast and therefore I have an incentive to promote Domain Money.

[Matt]

Clorox Centiva smells like lavender, cleans like Clorox and feels like all right, that could go on for a while. Experience the long lasting freshness of Clorox Santiva Available in Clorox Scentiva Lavender Scented Bleach Use as directed.