So Money with Farnoosh Torabi
Episode 1905: Ask Farnoosh: 50-Year Mortgage? Seriously?
Date: November 14, 2025

Overview

In this "Ask Farnoosh" Friday episode, financial expert and host Farnoosh Torabi tackles hot financial news—including the much-discussed notion of 50-year mortgages and the phasing out of the penny—before taking listener questions. Topics addressed include whether to add a child as an employee in a small business, how employer-assisted down payment programs work, splitting costs on furniture with a partner, and using a 529 plan as an adult returning to school. Farnoosh brings her signature blend of financial savvy, wit, and real talk, with a strong focus on practical solutions and the big financial picture.

Main Discussion Points & Insights

Personal Update: Local Impact & Financial Skills (02:40–06:40)

• Farnoosh kicks off with a heartfelt update on her new local podcast, The Montclair Pod, celebrating a Signal Award win and reflecting on the intersection of financial literacy and community journalism.

• She opens up about Montclair's local school district financial turmoil, calling for a forensic audit and discussing the challenges of local governance and mismanagement.

• Quote:

  "What I bring to this podcast is not just my skill set as a podcaster... but also my financial understandings, the fact that I can know how to read a balance sheet." (04:10)

• Encourages listeners to engage in civic life:

  "If you're not even in Montclair... I hope we’re inspiring you at whatever life stage you’re at to do the same. Go out there...dare to be creative, get loud." (06:10)

Hot Takes: 50-Year Mortgage & Death of the Penny

50-Year Mortgage: Why It’s a Bad Deal (06:40–11:00)

• Farnoosh breaks down the White House's floated idea of a 50-year mortgage, expressing deep skepticism.

• She explains the math: a 50-year mortgage minimally reduces monthly payments but massively increases total interest paid—more than double the cost in many cases.

• Quote:

  "It’s like you're buying a second house for the bank because you’re paying over $550,000 more in interest over the life of that mortgage. Why don’t you just go buy a summer home at that point?" (09:35)

• Farnoosh sees the idea as a distraction from real solutions:

  "This isn’t a solution to affordability, it’s just stretching the pain. Homes are too expensive… because incomes are not keeping up. The underlying issues: supply, wages, construction costs, lending standards—why not address that?" (10:20) "A mortgage that outlives your career—that’s not the solution." (10:48)

The Penny Is Phased Out: What Now? (11:00–14:00)

• The U.S. Treasury has discontinued production of the penny after 230 years.
• Pennies cost almost 3 cents each to make; there are over 100 billion in circulation.
• Farnoosh offers ideas for repurposing old pennies, from gardening (as fungicide) to DIY cold packs.
• Quote:

  “This is going to become one of those stories we’re going to tell in our rocking chairs to our great grandkids. I think I remember when the penny was around.” (13:20)

Listener Q&A

1. Should I Add My Child as an Employee in My Business? (14:00–18:48)

• Question from Lori: Should a business owner add her 2-year-old son as an employee, since she’s using his photos to promote the business?

• Farnoosh explains the tax and legal implications:

  • IRS has specific guidelines; wages must be reasonable and work must be legitimate.
  • Child labor laws vary by state, and a 2-year-old is likely too young under most laws.
  • If compliant, benefits could include the ability to fund a Roth IRA for the child, but stricter scrutiny applies.
  • Quote:

    "You have to be sure the work is legitimate and that the wages are reasonable for the services your 2-year-old, in this case, provided." (16:25)

• Suggests alternatives, like custodial accounts or education funds.

• Highlights new Illinois law: requires 50% of earnings from children in social media content be set aside for the child.

• Broader message: Protecting children from financial exploitation is vital.

2. Understanding Employer-Assisted Down Payment Programs (18:48–22:29)

• Question from Jennifer: How does an employer-provided down payment assistance work, and what are the tax implications?
• Farnoosh clarifies:
  • Most programs are structured as forgivable loans, typically forgiven over five years if the employee stays.
  • Tax is owed only on the forgiven portion in each year (e.g., $2,000 out of $10,000 annually over five years).
  • Risks: must remain employed to get forgiveness; if you leave, repayment or taxes on the balance may be due quickly.
  • Quote:

    "In general, these employer-assisted housing programs are really like loans...only the 20% which is forgiven in that taxable year is what you have to report as essentially income." (20:35)

  • Advises discussing with HR for company-specific details.

3. How Couples Can Split Furniture Costs When Moving In Together (24:07–27:48)

• Question from Christina: How should couples divide furniture costs, especially with different tastes and budgets?
• Farnoosh’s approach:
  • Start with an open conversation on “what money means to you”; bring in your financial histories and values.
  • Compromise and creativity are key—look for ways to save in one area to spend more in another.
  • If one partner makes more or wants to keep a specific item, it’s okay to let them pay for it.
  • Quote:

    "Please don’t break up over a dresser. This is not worth it." (24:40)

  • Using Facebook Marketplace and buying gently used items is recommended for savings and sustainability.

4. Should I Open a 529 Plan for Myself If I’m Returning to College in a Few Years? (28:07–31:48)

• Question from Ann: Is it worth opening a 529 plan as an adult planning to go back to school in 2-3 years, or use another vehicle like a CD?
• Farnoosh explains:
  • 529 plans offer tax-free growth and withdrawals, but a short time horizon makes investments risky.
  • If using a 529, keep investments very conservative (bonds, cash equivalents).
  • CDs and high-yield savings accounts may be safer given the short timeline; CDs offer guaranteed returns but less liquidity.
  • Quote:

    "Generally speaking, we don’t want to invest money that is needed before a five-year mark...if there are major dips in the market...that can take years, in some cases, for a recovery." (30:40)

  • CD rates are currently attractive (4.3–4.7% for three years).

Notable Quotes & Memorable Moments

• "A mortgage that outlives your career—that’s not the solution." (10:48)
• "Please don’t break up over a dresser. This is not worth it." (24:40)
• "What I bring to this podcast is not just my skill set as a podcaster...but also my financial understandings..." (04:10)
• "This is going to become one of those stories we’re going to tell in our rocking chairs to our great grandkids. I think I remember when the penny was around." (13:20)

Timestamps of Important Segments

• 02:40 — Farnoosh's personal update and Montclair Pod reflections
• 06:40 — Introduction to 50-year mortgage proposal
• 09:35 — Math and pitfalls of 50-year mortgages
• 11:00 — The death of the penny and its impact
• 14:00 — Listener question: Hiring your own child as an employee
• 18:48 — Listener question: Employer-assisted housing programs
• 24:07 — Listener question: Splitting furniture costs with a partner
• 28:07 — Listener question: Using a 529 for adults
• 31:48 — Wrap up: How to submit questions to “Ask Farnoosh”

Tone & Style

• Direct, conversational, and accessible—Farnoosh wants listeners to feel empowered and equipped to navigate personal finance with confidence and nuance.
• Emphasis on practicality, skepticism about “quick fixes,” and compassion for diverse experiences and needs.

Final Takeaway

This episode is classic Farnoosh: a blend of myth-busting, real-life strategies, and affirmation that sound financial decision-making comes from honest assessment—not gimmicks or shortcuts. She encourages listeners to stay informed, question the status quo, and focus on what really builds wealth and stability over time.