The Clark Howard Podcast - Episode Summary
Title: Most Affordable States / What To Know About Tariffs
Host: Clark Howard
Release Date: March 5, 2025

1. Introduction: Understanding Cost of Living Across the United States

In this episode, Clark Howard delves into the varying cost of living across different states in the U.S., utilizing data from Visual Capitalist to illustrate how far one's money can stretch depending on their location.

• Key Insights:

  • Hawaii: Recognized as the most expensive state due to high costs of importing goods, limited land, and expensive housing. Clark states, “[...] Hawaii is the most expensive place in the United States to live. But a lot of the things are not so obvious.”
  • West Virginia: Identified as the most affordable state, where money goes the furthest, in stark contrast to its neighbor, Virginia, which is comparably expensive.
  • Florida: Once an affordable haven with no state income tax, Florida has seen rising living costs, leading to an exodus of residents seeking more affordable states like the Carolinas, Tennessee, and Georgia. Clark notes, “Florida used to be not only the Sunshine State, but it was an affordable state to live in. [...] your money doesn't go very far anymore.”
  • Other Affordable States: Mississippi, Arkansas, Louisiana, Oklahoma, and Kentucky are highlighted as bargain states, although lifestyle preferences may influence relocation decisions.

• Notable Quotes:

  • [00:50] Clark Howard: “If you're somebody who has itchy feet and you're trying to figure out where's the most affordable place to live, I got the data for you.”
  • [05:20] Clark Howard: “Some of these that are more affordable, I would not have expected Michigan and Ohio. I would have assumed. That's why you never want to assume.”

2. Impact of Tariffs on the Economy and Personal Finances

Clark transitions to an in-depth discussion about tariffs, their definition, and their broader economic implications.

• Key Insights:

  • Definition of Tariffs: Clark explains tariffs as taxes added to goods, leading to increased consumer prices. “[...] A tariff is a tax added on to goods that you and I buy and then in turn leads not to a dollar for dollar increase in the item because the tax is only part of the equation, but does lead to an increase in prices.”
  • Economic Consequences: Tariffs can induce inflation, slow down economic growth, and potentially lead to stagflation—a predicament where the economy slows while prices rise. Clark emphasizes, “Tariffs can be really disruptive to an economy.”
  • Sector-Specific Effects: While some prices, like oil and natural gas, may decrease due to reduced demand, other sectors could experience price hikes.
  • Job Market Impact: Contrary to the protectionist intent, tariffs often result in job losses as businesses become uncertain about investment decisions.
  • Long-Term Uncertainty: Clark expresses unease about the widespread application of tariffs, highlighting unpredictability in their long-term effects.

• Notable Quotes:

  • [16:28] Clark Howard: “A tariff is a tax added on to goods that you and I buy... it leads to an increase in prices.”
  • [19:00] Clark Howard: “The thing about tariffs is the idea of tariffs is that they protect and increase jobs. In a country that imposes tariffs on others, ironically enough, often the effect is the opposite and a lot of jobs evaporate because of the effects of tariffs.”
  • [20:00] Clark Howard: “I've never liked tariffs. I find they eliminate having the most productive way to produce goods. It's just something that from raw economics is an unhealthy thing to do for long term economic growth.”

3. Listener Questions and Financial Advice

Clark addresses several listener inquiries, providing practical financial advice based on their unique situations.

a. Credit Freezing and Student Loans

• Listener: Jacob from Pennsylvania

• Question: Should he freeze his credit while managing federal student loans for his undergraduate and upcoming graduate studies?

• Clark’s Advice:

  • Manage Student Debt Wisely: Clark urges Jacob to be cautious about accumulating excessive student loan debt, suggesting he pursue graduate studies while working to mitigate borrowing needs.
  • Credit Freezing Recommendation: He advises freezing credit to protect against identity theft, especially important when managing multiple loans. “[...] it's better all the rest of the year other than that minimal period of time that you'd need to thaw for applying for the student loan renewals.”

• Notable Quotes:

  • [08:01] Clark Howard: “Your daughter already has these two student credit cards so long as she behaves with them, she's going to have a great credit score.”
  • [11:14] Clark Howard: “It is so easy to freeze and thaw that I recommend that you have your credit frozen.”

b. Car Rental Reservations and Third-Party Bookings

• Listener: Ross from Virginia

• Question: Are third-party car rental bookings through platforms like Kayak reliable, given horror stories on Reddit about lost reservations?

• Clark’s Advice:

  • High-Low Pricing Strategy: Clark explains that many traditional car rental agencies use a high-low pricing model, which can sometimes lead to overbooking issues.
  • Booking Strategy: He recommends booking through trusted third-party services like Costco Travel and then immediately confirming the reservation directly with the rental company’s system. This double-confirmation method can mitigate the risk of lost reservations.
  • Membership Benefits: Joining a frequent renter program can provide priority during high-demand periods, reducing the likelihood of issues.

• Notable Quotes:

  • [26:55] Clark Howard: “When you book third party, whether it's Costco or wherever, you'll see two different ways they're booked. [...] Then I go front of the queue with most rental agencies ahead of people when they're short of vehicles.”
  • [30:57] Clark Howard: “It is very important that people know even if you travel very infrequently, whatever car rental agency you end up booked with join their frequent renter program.”

c. High-Yield Savings Accounts and Barclays Bank

• Listener: Elizabeth from Connecticut

• Question: Should she continue using Barclays for her high-yield savings account or switch to another bank offering higher rates?

• Clark’s Advice:

  • Legitimacy of Barclays: Clark confirms that Barclays is a reputable institution and has been added to their list of high-yield savings accounts.
  • Comparative Rates: While Barclays offers decent rates (over 4%), he encourages seeking out online banks that may offer even higher yields (4-5%) to maximize savings.
  • FDIC Insurance: Emphasizes the importance of FDIC insurance and not exceeding $250,000 in a single institution to avoid potential losses.

• Notable Quotes:

  • [31:37] Clark Howard: “With your idle cash, you're committing financial malpractice for your own wallet. When you leave the money sitting in a traditional bank getting nothing on your savings, don't do it.”
  • [31:42] Clark Howard: “Barclays is absolutely fine, is a place to have your money.”

4. Conclusion and Upcoming Topics

Clark wraps up the episode by reiterating the importance of informed financial decisions. He invites listeners to participate in upcoming segments such as "Clark Stinks," where he addresses feedback and areas for improvement. Additionally, he promotes the Team Clark Consumer Action Center, offering free one-on-one financial advice.

• Notable Quotes:
  • [34:21] Clark Howard: “See you Friday.”
  • [34:35] Clark Howard: Final sign-off emphasizing commitment to helping listeners save more and spend less.

5. Additional Resources

Listeners are encouraged to visit www.clark.com/askclark to submit their questions and access resources like Clark.com and ClarkDeals.com for further financial advice and deals.

This episode of The Clark Howard Podcast offers valuable insights into choosing affordable states for relocation and understanding the complex impacts of tariffs on the economy and personal finances. Through expert advice and practical solutions, Clark empowers listeners to make informed financial decisions amidst changing economic landscapes.