The Clark Howard Podcast - Episode Summary: "Mindful Dining / Warning: Pseudo Health Insurance" (02.28.25)
Release Date: February 28, 2025
In this engaging episode of The Clark Howard Podcast, host Clark Howard delves into a variety of consumer-centric topics, ranging from the pervasive issue of smartphone addiction during dining to critical warnings about non-compliant health insurance plans. Alongside his co-host Krista, Clark addresses listener questions, offering valuable financial advice and insights to empower individuals in their personal finance journeys.
1. Mindful Dining: Combating Smartphone Addiction
Timestamp: [05:03]
Clark Howard opens the episode by highlighting the growing trend of smartphone addiction, especially during meals. He observes that the ubiquitous presence of smartphones is detracting from genuine human interactions and the overall enjoyment of dining experiences.
Clark Howard [05:03]: "More and more and more people are staring at these addictive devices that we carry. No wonder there's this backlash that a small number of people are going back to flip phones to dumb phones because they don't like the way their life is being controlled by the smartphone."
Clark emphasizes the importance of being present during meals and encourages listeners to assess their own habits:
Clark Howard [05:03]: "What do you see? More and more and more and more people are staring at these addictive devices that we carry."
He further shares personal anecdotes about phone usage, including a scenario where he receives a notification about reduced phone usage during a vacation:
Clark Howard [05:03]: "My phone tells me every week if I'm using my phone more than I did the week before, less than I did the week before."
The discussion extends to the psychological impact of smartphones, suggesting that constant connectivity can hinder relaxation and mental well-being.
2. Navigating TV Deals with Best Buy
Timestamp: [05:37]
In collaboration with Krista, Clark addresses listener Hoyle's query about the best time to purchase a 50-inch smart TV from retailers like Best Buy. Clark provides a comprehensive analysis of TV sales cycles, emphasizing the importance of timing purchases during specific periods to maximize savings.
Clark Howard [05:47]: "The calendar is really the most important indicator, more than anything else with TVs is buying in those inflection point periods when the retailers have all the door busters."
Clark advises waiting for major sale events such as Black Friday or the pre-Super Bowl period, where significant discounts are typically offered. He also highlights the utility of resources like ClarkDeals.com for tracking daily TV prices and identifying optimal buying opportunities.
Clark Howard [07:52]: "If your TV croaks and you can't wait till one of the normal sales periods when TVs are a real deal, then just watch the bargains that we publish at Clark Deals or any other bargain site to find deals available on the TVs."
3. Listener Questions and Financial Advice
a. Evaluating Rental Property Investments
Timestamp: [07:52]
Bob from Oklahoma inquires about the viability of purchasing a $292,000 home as a rental property, contemplating a $100,000 down payment with an expected rental income of $2,100 per month. Clark scrutinizes the numbers, pointing out that the rental income falls below the 1% rule of thumb, which suggests that monthly rent should be approximately 1% of the purchase price to be a sound investment.
Clark Howard [08:16]: "This violates a lot of real estate. Investors aren't buying investment real estate right now to rent out because the threshold that makes a rental compelling is when the rent you can get per month is equal to about 1% of the purchase price."
After receiving additional information about the financing approach and concerns about using retirement funds, Clark advises against the investment, highlighting the financial imprudence of the proposed plan.
Clark Howard [10:02]: "This is not a compelling purchase that would make it worth doing all that taking money from a retirement account or anything like that. I would not do this."
b. Escaping a Costly Professional Association Contract
Timestamp: [10:22]
Kimberly from Pennsylvania shares her distressing experience with a professional association that contracted her to pay $1,000 monthly for 12 months, promising significant business growth and one-on-one coaching. Dissatisfied with the lack of results and dubious practices, Kimberly seeks advice on how to terminate the contract without incurring negative repercussions.
Clark empathizes with her situation, labeling it a classic lead generation scam. He advises settling the remaining balance to avoid further complications such as collections and credit damage. Additionally, Clark emphasizes the importance of obtaining a written release from the association upon payment.
Clark Howard [11:48]: "You need something in writing that the amount of money, whatever amount it is you agree to pay, is a full and complete release from them."
Clark also warns other listeners about the prevalence of such scams targeting small business owners, encouraging vigilance and informed decision-making.
c. Managing Credit Cards and Credit Scores
Timestamp: [20:16]
Michelle from Ohio seeks guidance on whether to close inactive credit card accounts to simplify her credit report and reduce the risk of fraud. With a strong credit history but multiple unused cards, Michelle is concerned about potential security breaches.
Clark advises a cautious approach, suggesting that Michelle monitor the impact on her credit score as she gradually closes inactive accounts. He emphasizes the importance of maintaining a healthy credit utilization ratio and cautions against making abrupt changes that could negatively affect her credit standing.
Clark Howard [20:56]: "If you want to close one, close it and see what happens. If there's any meaningful movement in your score after you close it, if there's not one, take another one that you haven't used in a good long time and close it."
d. Deceptive Extended Warranties in Vehicle Purchases
Timestamp: [22:40]
Mark from North Carolina recounts his experience with purchasing an extended warranty for his 2025 vehicle. The finance manager insisted on the warranty's necessity to maintain the powertrain coverage, which Mark later discovered to be misleading. Although he was able to cancel the warranty, the process was arduous and time-consuming.
Clark condemns the practice, labeling it as deceptive and profit-driven. He underscores the importance of understanding extended warranties as insurance products, which often come with significant profit margins but limited coverage.
Clark Howard [23:22]: "There’s so much profit in that piece of junk extended warranty because they’re not selling you the manufacturer's own, they're selling you some marketing outfits warranty because the profit margins are unreal on those."
Clark advises listeners to be vigilant during vehicle purchases, recommend canceling unwanted warranties within the allowed cooling-off period, and to thoroughly evaluate the necessity and value of such add-ons.
e. Choosing the Right Budgeting Apps
Timestamp: [24:19]
Gene from Louisiana asks for Clark's opinion on online money management tools like Mint and Rocket Money. Clark acknowledges the demise of Mint and discusses alternatives, pointing listeners to Clark.com for comprehensive reviews of various budgeting apps.
Clark Howard [24:39]: "There is no one size fits all. I mean if somebody feels like they just got no idea where their money goes every month, I’m a big advocate for YNAB."
Clark emphasizes that the effectiveness of a budgeting app depends on individual financial goals and habits, encouraging listeners to explore and select tools that best align with their personal financial management needs.
4. Warning: The Rise of Pseudo Health Insurance Plans
Timestamp: [16:41]
In a crucial segment, Clark warns listeners about the emergence of non-compliant health insurance plans that may seem attractive due to their low premiums and minimal deductibles. He explains the stark differences between compliant and non-compliant plans, emphasizing that the latter often exclude coverage for serious medical conditions, making them inadequate substitutes for traditional health insurance.
Clark Howard [16:41]: "A non compliant plan can exclude people based on pre existing conditions or can exclude coverage specifically for a pre existing condition you have but cover other things."
Clark cautions consumers to be wary of these pseudo plans, advising them to prioritize comprehensive coverage despite higher premiums to ensure protection against significant health-related expenses.
Clark Howard [20:16]: "You compare, I mean you look at, a compliant plan, it’s going to have high deductibles you’ve got to meet, it’s going to have high premiums you have to pay. But then if something really bad happens to you, that’s covered, that’s the difference."
5. Conclusion
Clark Howard concludes the episode by reiterating the importance of informed decision-making in personal finance. He encourages listeners to leverage resources like ClarkDeals.com and Clark.com for ongoing savings and financial empowerment. The episode serves as a comprehensive guide for consumers to navigate financial challenges, avoid common pitfalls, and make choices that lead to long-term financial well-being.
Clark Howard [25:33]: "Empowerment is available to you through knowledge around the clock. And that’s our deal is that you learn ways to save more and spend less and avoid getting ripped off."
This episode of The Clark Howard Podcast offers a wealth of information and practical advice, addressing contemporary financial issues and providing listeners with the tools and knowledge to enhance their financial health and consumer awareness.