Wesley Moss (2:22)

With all the geopolitical chaos we've had this year and really last year. The there's this constant worry that the world will be moving away from the dollar. We have some perspective on that today, too.

Krista (2:34)

And then, of course, Wes will be answering your questions that you've sent in@clark.com ask. Please note if your questions for Wes or for Clark and Clark will be back with a new episode tomorrow. In case you're new to this show, we have Ask an Advisor every Tuesday because Clark does three episodes a week. And we thought it'd be great to actually have a fiduciary financial advisor on the show answering your questions. Cause Clark is not an advis and he focuses more on the consumer angle.

Wesley Moss (3:02)

That's me.

Krista (3:03)

I feel like it really I feel like both of the shows work well together. They complement each other well.

Wesley Moss (3:09)

Let's start with so a lot of the topics I cover are things that get brought up to me in any given day or week in my path as a dad and a financial advisor. Helping families find happiness in retirement. And we're very often there's a big part of the conversation has to do with family. And I had a couple in the other day who was asking to talk about their grandkids, and they were just out of college and having trouble finding jobs. And they said, wes, you've got all these young kids, and I've got a couple that are just getting to college age, looking at college, and then a few that are younger than that. And I think the younger they are, the more you look out into the future and say, well, in 10 years from now, what are kids going to be doing? And I think it's always scary as a parent to think, well, what are my kids going to do for a life living? A lot of folks are asking this question and we've talked a lot about the topic of AI and what that means for careers. I think it's a normal question to say, well, what are our kids going to do in the future? Is AI going to take our jobs or their jobs? And a lot of 2005, there were fears bubbling up. And I remember Wall Street Journal had an article about college graduate unemployment was rising, and it kind of confirmed the fears.

Krista (4:29)

I remember that very well.

Wesley Moss (4:31)

And you're thinking, that's not good timing.

Krista (4:34)

My friends. Yeah, my friends and I were sending that to each other.

Wesley Moss (4:37)

So first of all, maybe I'll start out with this. That's a myth.

Krista (4:40)

Okay.

Wesley Moss (4:41)

That has not happened. There was a little bit of an upward trajectory. If you. And again, this is these are numbers we can look at and we can track unemployment rates for the entire nation, different segments of the nation. And if we were to look at college grads age 22 to 27. This is a fun chart here for you, Krista. If you look at it, as of the most recent data, it's pretty much in line around between 5 and 6% college grads age 22 to 27, very similar to what it was in 2023. And AI started in what, 2022 and 2018 and 2015 and 2007, et cetera. You get my point. It's pretty much the same as it's been for the last 20 years, 25 years. So I get why we're nervous about our college kids not being able to find work, but that's just not happening. They're getting jobs, and they're just at the same rate as they've almost always gotten jobs at. Because it's just inherently a tough thing to do. You have to break. You've got to get that first job, and that is just tough. It's a little harder than when you're already in the workforce and you're changing jobs. Sure. First of all, so far, that is just a myth. It's always been hard for college grads to get jobs, and it's no different today. And there is no evidence at this point that AI is making that a lot worse. Could that change? Sure. But there's always some sort of technology that we're worried about. Oh, it's so hard to break in. The second thing that the two other, I think, important points that I would bring up about the labor market is that the labor market is, I think, much more dynamic and more vast than we give credit to. You tend to think, well, I've been in a job for 10 years, and people get a job and they stay in their jobs. And you don't hear all that much about jobs changing. Maybe it's 1 or 2 out of 10 people maybe change jobs, but they don't talk about it a lot. It's a little easier to point to. Oh, Krista, you've been here working with Clark for decades or more than a decade. I've been in my firm for almost, you know, coming up 20 years. And then we hear the job numbers. This is the other thing. I think this is what gets the press in. In when it comes to the labor market. We added 50,000 jobs, or we lost 20,000 jobs, or the last report, we added 170,000 jobs. So we think the jobs market, even though we know it's vast it's 100 and almost 60 million people are working. You think in terms of 10,000, 50,000, 100,000. But if you stop and really look at the job market, the movement within the job market is so much bigger than I think most people get credit for. In 2025, last year, over 60 million people got hired. Well, wait, wait, wait. Did you add new? Wait, wait a minute. We only measure net new jobs. We only measure net. There's so much more turnover in the labor market than we, I think, give credit for. 2023 annual hires were 71 million.

Krista (8:08)

That's crazy.

Wesley Moss (8:10)

Is that. How can that even be right?

Krista (8:11)

I know.

Wesley Moss (8:12)

In 2025, US employers made 61.4 million hires. Wow. That doesn't seem to make any sense. Well, it's because there's a lot of movement underneath the surface. So in 2025, there were almost 38 million people who quit their job there. 38 million people that quit their job. There were 21 million people that were either laid off or discharged. Other separations, which are retirement, death transfers, et cetera. Another almost 5 million people. So you get this scenario where the labor market has an enormous amount of churn and change and dynamism, if you will, much more than I think we give it credit for. Because the 38 million people who quit, that doesn't mean they didn't just go get another job. They quit. Most of the time it's because they went and hopped to another job. So there's lots and lots of change. Think about a stadium. 160,000 people, or in this case, our stadium for the U.S. labor market is 160 million people. And in any given year, about 40% of those people change seats, or 40%, and some of those people leave and new people come back into the stadium. That's labor force participation. You may move to a different section of the stadium, might just move to a different seat. But when you start thinking about how vast the job market is, and there's over 1,000. There's over 1,000 different codes for the kind of job you have, we tend to think it's not just doctor, lawyer, nurse, firefighter. There's some popular jobs that we think about, but then there's another thousand jobs that we don't necessarily hear about every single day. And that, to me, allays the worry of what are my kids going to do for a living? Well, there's over 1,000 different things in this economy that they can do. And there's gonna be some change and some churn, but there's Always that and it gives me hope that they will be able to find something. But it's always gonna be a little tougher on that first job for sure.

Krista (10:23)

All right, we'll go to some questions that came in for you, Wes. This one came in from Emory in Iowa. Emory says I would like some financial advice on getting a pilot's license and a career change. At 44, I have three daughters ages 10, 8 and 6. The year they were born, I funded $40,000 into each of their 529 accounts in the VOO S&P 500 ETF. That money has now grown to $325,000, a gain of over 200K. The Obbba tax law now allows for tax free distribution of 529 money to be used toward Part 61 flight schools to get a pilot's license. There's a school close to where I live in Iowa that charges $90,000 to receive a full multiengine license and partners with some smaller regional airlines for employment after the license is achieved. The classes and training would take about a year. I'm thinking about using some of the 529 money towards the pilot's license for myself and saving the remaining for the kids.

Wesley Moss (11:21)

This is not proof that we have the coolest. The Clark Howard show listeners are the coolest. I know this guy's from Iowa. Emory from Iowa. First of all, he did 120 grand for his kids is what he put away. Now it's worth 320. That's incredible.

Krista (11:37)

It is.

Wesley Moss (11:38)

I know it's three. There's a lot of. There's a lot of daughters. It sounds like a lot of daughters.

Krista (11:43)

You have a lot of sons.

Wesley Moss (11:44)

I have a lot of sons. The Emory, you're totally right. The OBBB changed a lot of different things in the tax code. One of them was the 529 plan. It's expanded what you can utilize that money for. Meaning that it comes out with without penalty and without taxes. And that, that was, that was harder to do before the new changes. First of all, it sounds like you already have a lot of retirement money at a pretty young age. I mean you're. I would say 44 is young. This an easy time for a career change. And 90k out of the 529 plans, I mean it still leaves you with over $200,000 for education. And they're still young. I mean your 10 year old has another eight to nine years. Your eight year old has another decade and then the six year old, that's well, way out into the future before school. So this money that if you were to spend the 90, you still have over 200, way ahead of most folks and that could be 400 by the time they go. So I think you're still fine on the kids education. And what you're doing here is that you're creating tremendous stability in your career. There continues to be a pilot shortage. It's a job that's highly regular and it's flexible in how much you want to work. And it's 100 to $125,000 a year job probably at minimum once you get your hours and after you get your education, then you get your hours and then you're off to the races. And who knows, maybe you become a flight officer or captain and your pay goes up from there. But I love that as a steady career. That also gives you lots of other time if you want to pursue other things. I think it can be a really flexible career. So I think that you're looking at that in the right way. And this is a good example. What Emory's bringing up is that we get 100 changes. And on the surface when you get all the changes, you don't know exactly how that's going to apply to people in real life until you start discussing what's happening and how people start looking at these rules and say, oh, wait a minute, this opens up a new opportunity in Emory. That it does just that. So anybody else? Same thing. If you've got a ton of 529 plan money and you want to go back and have more education, that door now is much more open than it's ever been.

Krista (14:10)

And then the whole Roth conversion option too that they put in with the 529 plans too, gives people more flexibility around their kids. Worried about that for their kids. Okay. Corey in New York says, I have a Roth IRA slash brokerage and over the last two years I've learned to diversify about 30 to 40% of my stock holdings into dividend paying stocks. My question is, what are the implications of buying like 50 more shares a couple of days before the ex dividend date and then selling after the pay date. Do you have to actually own X number of shares for a whole quarter before they will pay you out? Or can you use this strategy?

Wesley Moss (14:44)

Yeah, Corey, you just need to own on the X dividend dates so you don't have to own the whole quarter in order to get your dividend. The problem though is that if you own for less than 60 days, then instead of qualifying for the lower tax rate on dividends, you end up having a higher tax rate. So I believe it jumps to more ordinary income. I see what you're saying. You're saying why can't I just buy before the ex dividend date, you're the owner and then you don't even need to hold the shares and you still get the dividend. The problem is that in a vacuum and the textbook way to think about this, and it depends on the stock too. But in a textbook world, on that one day where let's say you've got $10 a share and it's paying you 20 cents, technically on the day of the dividend the shares should be at 980. So there is no free lunch when it comes to just going in, owning for a day, getting the dividend, usually you're going to see that it gets negated by the share price. Now in the real world you can very often if the market's having a good day or there's positive news on that company, you get the dividend and the next day the stock could be at $10.50. You don't notice it. But if you were to do this over and over and over again, eventually you end up if you're trying to trade dividends for the short term, there is really no free lunch and you have worse tax treatment to do so. So it's not a strategy I like. What I do love is you've diversified 30 to 40% of your holdings into different dividend paying stocks. They're meant to be held for the long run, not the short run.

Krista (16:29)

Okay, we're going to take a quick break and we're going to come back when we have more questions for you. Wes. And you're going to talk about the US dollar.

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Charles Schwab Advertiser (18:46)

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Wesley Moss (19:18)

Welcome back to Ask An Advisor here on the Clark Howard Show. I'm Wesley Moss along with Chris Adibiaz in her color wheel Green and we are here to continue to answer more of your questions. Today. This is almost a debunk Tuesday.

Krista (19:33)

I know. I like it.

Wesley Moss (19:34)

Debunking youth unemployment. No evidence of that or very little evidence. I'm still a worry but just not really happening. Number two, debunking that the US dollar huge worry over the last year. All of the geopolitical issues that we've had. Remember because of the Russia, Ukraine War we did sanctions with Russia. We've used that as a tool that has scared countries supposedly into using less dollars. And the reality is that I think those fears are just way overblown as well. And there's three ways to look at this. What is a reserve currency, by the way? It was in 2011, Barry Eichingold wrote a book called Exorbitant Privilege, the Rise and Fall of the US Dollar. That book is. Looks to be out of print. Of course, there was a collector version. I was on Amazon looking at it. There's a collector version for $1,000 to buy. It's almost like an antique car. So it just didn't, it just didn't work. I mean, if you look at the. So there's medium of exchange, is the currency medium exchange two is a unit of account and number three, is it a store of value? How does the dollar check on those three boxes? Number one, medium of exchange, dollars still runs the cash register around the world. In the Americas, as you would expect, it's 96% of even export invoices are still in US dollars. Asia Pacific region, 74% of all trade invoiced in dollars, even in the euro. The euro is set up and they have their own currency. Euro has the euro and they still use 23% of all their transactions are still in US dollars. And if you measure the rest of the world, which would be beyond the Americas, Asia Pacific and Europe, it's 79% again, transactions in dollars. So it's very clear that 3/4 to 95% of transactions are still happening in US dollars. According to IMF, there's just been no significant shift away from the dollar in global trade. And that's over the last call it three to five years. Despite this constant worry of the de dollarization of the world, it just doesn't seem to be happening. Is it a unit of measure or unit of account, essentially a measuring stick? Well, yes, because oil and most commodities are still traded in US Dollars. International banks lend in US dollars very often, especially emerging market companies. And then companies all over the world issue debt in US dollar denominated bonds. So yes, it's still very much a measure. And then three, is it a store of value? What is central banks? So obviously we talk a lot about the Fed in the United States, but there's a European Central bank, the bank of Japan, the Swiss National Bank. So there's the big central banks around the world. If you go back to 2005, so let's go back two decades ago. If you Looked at the whole currency soup in the world, it was 61% to 62% US dollars. Twenty years later, with all the talk of dollar people moving away from the dollar, diversifying elsewhere, still right now at 58 to 59%. So we've gone from 61% to 59% over 20 years. The soup is still the heaviest ingredient by far and it's barely lessened is the US dollar. So why all the dollar doom talk, Krista? I don't know. Because it's a better story to say that the dollar is going away than the dollar is strong and fine. It's a scarier article. Maybe every time you see a move in something like gold, we think, oh, well, it's because the dollar. Well, maybe it's not because the dollar is lessening or weakening. It's just because more people are wanting access to that particular other investment. And if you looked at advanced economies trade weighted dollar from 1975, that index was at about 100. Today it's at 123. So it's actually gone way up over the last 50 years. So we'll continue to. I guess my message here is let's not get caught up in what seems to make sense. Oh, the dollar's going down, Youth employment is terrible, but in reality it's just not true. And we don't want to make our investment plans around things that the media would love to be true that just are not.

Krista (24:03)

Okay, let's go to questions. I've got one from Chris is from your favorite, one of your favorite states. Michigan.

Wesley Moss (24:09)

Michigan. I thought about doing this topic, but the Red Fin just released the basically the craziest expensive places in the world where listings are over 60% all over a million dollars. Nantucket was number one. And there's a place I'd never heard of, but I think it must be near Aspen. It's called Rifle Colorado, where they have like 25 to $50 million homes. But on the list. And this is again, Clark wouldn't believe it. Yeah, but Petoskey, Michigan was on the list.

Krista (24:41)

Where is that?

Wesley Moss (24:42)

It is in northern Michigan. It's not. I do not. That's not where I go necessarily. But it's near where we go. But again, the reason is beauty. It's all of these places are beautiful and they have limited land either because of water or because of building permits because you're in the mountains and they're just gorgeous places. Just. It was interesting. I'm gonna make sure I talk to Clark about that. Just right about it today.

Krista (25:05)

You're gonna get him there. Chris in Michigan says, I have a question regarding the four Roth IRA and Roth 401k accounts that I have. I have had three of these Roth accounts for over 20 years and one account for 10 years. So all of these currently meet the five year rule. I'm 65 years old and would like to combine these accounts into one account to reduce redundancy and extra tracking. My question is, how do I get my Roth Roth 401k accounts over to Fidelity and maintain the 10 to 20 year ages of these accounts so I don't reset the five year rule? I'm confused when I read the rules and I don't want to make any mistakes. I'll have to admit that I ignored recommendations over the years to take my accounts with me as I change jobs. Now, in hindsight, I wish I had done this. And I recommend to any listeners, do yourself a favor and as long as the options are decent, take your accounts with you as you change jobs.

Wesley Moss (25:59)

Okay, so Chris, I believe you have the vintage, you've got the five years and you're over the age of 59 and a half. The IRS and I know this is confusing and I've read about the, I've read this over and over and over again. It's so hard. The concept of how they this is stated is still a little confusing. But the IRS treats all of your Roth IRAs one if you have two of them or if you have four of them, supposedly they treat them all as one Roth IRA when it comes to the five year rule. So if you've got one of them that has more than the five year rule, then technically, and you've got one that's 20 years old, then you have the five year vintage already. And even if you opened a new one because that money is vintaged or new Roth, it still should be treated as that same age by the irs. So again, I'm not a, I don't work for the irs. So sometimes their rules, maybe somebody will say something different for this. But from my understanding, the IRS treats all your Roth IRAs as one single account when it comes to the five year rule. And you're over 59 and a half, so I don't see any issue. And by the way, this is for you to keep track of too, I think. When does this come up? It probably would come up if you were audited. And the onus is on you to make sure that you could prove that like, hey, I opened this thing, is 8 years old, 10 years old, 20 years old. So this is where records, I think, become important, number one. Number two, you should be able to do rollovers into one Roth at XYZ brokerage firm. It doesn't matter because you have the vintage. And there's no reason to have five different Roth accounts, particularly at your age. So I think you should. It makes sense to consider consolidating into one so you can have more visibility into it. If you're doing direct rollovers from roth into many ROVs into one.

Krista (28:03)

Okay. Suzanne in California says, I've saved $100,000. I would like it to earn more than the basic CD or savings account offers these days. And I already fully fund my Roth 401k and HSA. What options do I have?

Wesley Moss (28:19)

Suzanne, super saver. Suzanne, super saver.

Krista (28:23)

That's what I would say. Amazing.

Wesley Moss (28:25)

Super saver from Sacramento. Suzanne, you have all the options in the world. And by the way, that's why investing is so great. And it's also why investing is so hard, because you have unlimited options. Susan. It's not that they're limited, it's that they're unlimited that makes everything so difficult. So this is really an investment question. Remember to think about stretching your timeline. I don't think you said how old Susan was, Suzanne.

Krista (28:52)

No, she did not mention that.

Wesley Moss (28:54)

But for the most part, I mean, if you're in your 40s or 30s, 40s, 50s, 60s, you should still have a 20 plus year time horizon, God willing. So you got a long time. Most people that are, they're writing in have what I would consider really long, appropriately long time horizons. So it's really just an investment question. And if you're already invested in your Roth account and your 401k account and maybe even your HSA account, you have some investments that if they're good enough for those accounts, why aren't they good enough for this money? There's nothing special about a 401k. It's not like you get protection because it's in a 401, even though people think they do because it has this grand title. What's a 401k? Well, it's totally dependent on how you're invested in the 401. So if it's good enough for those accounts, then very likely it's good enough for a portion of that $100,000. So maybe you have some broad market stock index funds or mutual funds inside of those retirement accounts. Find a version of that and probably you can find a lower cost version because now this would be brokerage money. And that would make a lot of sense. And because it's a bigger, let's say, pot of money, think about getting both diversification, which you would automatically do in most broad market ETFs, and then some asset allocation, meaning that maybe you don't just want us large cap stocks, which is the S&P 500. Maybe you want some international, maybe you want some small and mid cap. Maybe you do want some fixed income, maybe you do want some commodities. But build out the wheel of diversification so you feel comfortable. And the reason you probably feel more comfortable by your retirement accounts is it probably already has diversification like that.

Krista (30:47)

Okay, Greg, writing in from your home state of Pennsylvania, Greg says do you know of any tools that can deconstruct a mutual fund or portfolio into its component stocks? I'm always intrigued to know how much exposure to any particular company, such as Facebook, Alphabet or Home Depot I have in my portfolio. But it's mixed into all of the funds I hold, like VF or VTWax, etc. Thank you for all you do. We love the deep dive investing content on Tuesdays.

Wesley Moss (31:19)

Greg from PA I think it's gotten easier and easier to find open up the hood on, on an ETF for a mutual fund that it's, it's easier today than it's ever been. Almost every fund you can go to their page that is their fact sheet and it should list out usually the top 25 holdings. I know tools like Y charts will give you think all actually they will give you all of them. Every single I've looked. If you have an ETF with 450 stocks, it'll literally give you all 450 stocks in order by market, by percentage. Bloomberg does that. You can utilize AI to do that. A lot of AI finance tools for usually even the free version, I know you can at least get the top 25 holdings.

Krista (32:08)

So the first one you said was

Wesley Moss (32:09)

why stocks, why Charts?

Krista (32:11)

Why Charts? Why Charts?

Wesley Moss (32:11)

Why charts does that. Morningstar has something literally called, I think it's called Morningstar X Ray because it takes an X ray of the funds and shows you what's inside. That may be paid as well. But that's not a huge, that's a relatively low subscription, I believe. But and I love that you're doing this. This is the cool thing about it is what you're asking Greg, is that it's really important to understand what is in your funds and in the world we live in. I think it's a little easier today than ever before to at least get the core main holdings. That way you can look at the sectors. That way you can look at the actual names of the companies and then the percentages and the breakdown. And I think that's super important and helpful, particularly if you're interested in it. So a lot of ways to do it in the world we live in today.

Krista (33:01)

All right. Well, Greg, thank you for saying that you enjoy the deep dive and investing on Tuesdays. And thank you to each of you who has listened to this episode. If you got this far, we really appreciate it. We hope that you'll subscribe if you're not already subscribed, whether it's on your podcast app or on YouTube, and that you'll give us a review as well. We truly appreciate it and it helps us to reach other people and hope the rest of your day is fantastic. We'll be back with you with another new episode next Tuesday.