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The Clark Howard Podcast
08.01.25 Clark Answers His Critics on Clark Stinks / Amazon Price Changes
00:34:32
Clark Answers His Critics on Clark Stinks / Amazon Price Changes
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- [00:00]
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- [00:31]
Clark Howard
Just speaking into the void?
- [00:34]
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- [01:04]
Clark Howard
It'S my pleasure to welcome you here to the Clark Howard show, where our mission is to serve you with advice and information that empowers you so you make better financial decisions in your life. And Happy Friday to you. It's that time of the week when you get to air your disappointment with me with advice I've given, things I've said in our weekly Clarkston segment. And later I got a special price warning for you about shopping at Amazon versus Walmart or Sam's Club for everyday kind of items. Amazon has cranked up the prices, but right now it's time to crank up your complaints with me. And today's Clark stinks. I should have never encouraged you to speak. You must think I'm pretty stupid.
- [02:01]
Listener
You should be ashamed of yourself.
- [02:02]
Clark Howard
Well, maybe I'm wrong.
- [02:03]
Listener
Maybe I'm wrong.
- [02:04]
Clark Howard
Maybe you're right, pal.
- [02:12]
Listener
Okay, Clark, my man, buy a bike from a reputable bike shop. Not online, perhaps from Facebook Marketplace. Bikes from big box retailers are unlikely to even be assembled correctly. But then spend another $20 on a brightly colored safety vest and a bright tail light. These could very well save your life.
- [02:35]
Clark Howard
J.P. what did I say about bikes before? I don't remember this.
- [02:39]
Listener
It must have been something about saving money on a bike the like. You know that you bought a bike at Walmart or somewhere like that.
- [02:46]
Clark Howard
Well, which I have. I bought very cheap bikes. I don't ride a bike for speed or for distance. I just ride a bike for fun. And so I've never been someone who felt that I needed to go to a bike shop. Lane feels completely differently though, and feels like you. JP Lane went to a real bike shop and bought a bike and it has outlasted two of my cheap bikes.
- [03:20]
Listener
So there you go.
- [03:21]
Clark Howard
Yeah.
- [03:22]
Listener
All right, Clark, you don't stink anymore because you've recently redeemed yourself with the Aldi Smash Burger suggestion. A few years back when you suggested the Dollar Tree meat for a dollar each, I tried them. I totally remember that. Yuck. They tasted worse than the package they were wrapped in. And they were so thin that you needed to buy at least three to even see them in a sandwich. To say I was reluctant to try another quote unquote meat suggestion from you would be an understatement. But I value your opinions over the years. And try it again. As it turned out, the Aldi Smash Burger was a smash hit. A great tasting, decent sized burger at a great price. Just curious though. Did you really like the Dollar Tree meat? Thanks for all you do, Don.
- [04:04]
Clark Howard
No, no. In fact, on TV, we did a test of the Dollar Tree Steak. It was a little teeny steak for a dollar. Yeah, it was not very good. That was true. But the Aldi Smash Burger, wow. I love those. It's hard to find them because they're so popular. They sell out and you go there and you're like all prepared to buy them and it's cleaned out.
- [04:31]
Listener
All right. On a recent podcast, Clark advised never sending a check through the US Mail. On the same podcast, he talked about using qualified charitable distributions to reduce required minimum distributions. But the two favorite children I use both require QCD checks to be sent by U.S. mail. Vanguard's website indicates that once I request a QCD for a charity, Vanguard will send a check voice via US Mail. And then I mail the check to the charity. That's two opportunities for stolen checks. Schwab provides a QCD checkbook to reduce the stolen check opportunity to 1.
- [05:04]
Clark Howard
Richard so, Richard, this is just nuts. You know, the. The Federal Reserve came up with a system called Fed now to eliminate this problem. And I don't know what's going on in the nuts and bolts behind the scenes that the big financial houses and the big banks are not using it as a way to send money because it eliminates the problem of all the check theft in the mail. I am terrified of ever sending a check in the mail because it's where criminals are concentrating in a stolen check. Once stolen, it's unbelievable what a hassle it is. Remember, told a story A couple of months ago about people whose distributions from retirement plans were being sent by check. The checks were being stolen in the mail and then they couldn't get their own retirement money restored by the financial house that was managing the 401k.
- [06:06]
Listener
Bad ugly Clark, you really missed it with the carry on discussion. Outside of the United States, a major factor in carry on is weight. Depending on the airline and region, the weight limit can be as low as 7kg or 15lb for a carry on. At that amount, all the usual packing hacks fail and the weight can be almost completely consumed by a few electronics, toiletries, chargers, etc. It doesn't matter what the dimensions of the bag are if you can't fill it up due to weight restrictions. Airlines don't always weigh, but sometimes they do, and as a result it's impossible to plan ahead. You also missed a great opportunity to talk about using the cargo vest to redistribute heavy items. Daniel.
- [06:44]
Clark Howard
Daniel thank you. So that was pioneered by a company called scottevest that sells a bunch of clothing for men and women that has inside it all kinds of pockets. So what you're wearing doesn't count is your carry on allotment. And so a lot of people who travel in Europe and Asia because of weighing the carry on bags, wear their clothing, wear their stuff, particularly electronics. Like I've noticed a lot of the Scotty vest stuff now is designed to carry your electronics in one of their jackets that are different weights for different seasons. But you can carry the most stuff during the cold weather season when you can hide so much more in a puffer type jacket in all these inner pockets. But yes, it is true, it's a big thing now in Europe particularly that they weigh your carry on bag and they give you the big no on being able to take it and then they hit you with their highest charge for a checked bag doing it at the last minute. Completely true.
- [07:57]
Listener
I talk about the show nonstop, my poor friends, am I right? And I'm not sure if Clark stinks on this one or if it's me. I heard Clark say on the show that to be ineligible for a Roth IRA you had to make upwards of 500k per year. When I look it up, this is what it says. Married, filing joint returns less than 236,000. I love the show. Such a positive force in an otherwise divisive media environment. Bethany.
- [08:24]
Clark Howard
Bethany, thank you. All right, so what I was talking about in context of that was not the income limits for doing a Roth ira, which by the way There aren't any. If you don't have a retirement plan at work, you're not subject to the income limits. And almost half of us don't have a retirement plan at work. So regardless of what you're earning, you're able, if you don't have a retirement plan at work, to do a Roth IRA. What I was referring to was the Roth 401K, that unless you're an ultra high income earner, in most cases something close to half a million a year or more for a married couple, maybe 300,000 a year as a single individual. When you're given the choice at a workplace of contributing to a Roth 401 or a traditional 401 you want to do the Roth tax rates are unusually low today on income we earn at a job. And the Roth gives you the ability for your money to grow tax free in a 401 and spend it tax free in retirement, where there's all kinds of complications with traditional 401k money, not just the tax later in life, but also what other federal penalties the Congress has dreamt up. Like for people on Medicare who have to pay a lot more for Medicare if they have tons of money In a traditional 401k, you don't stink.
- [09:54]
Listener
But you recently said in one of your Clark minutes that the Roth IRA forces you to live on less than you make. Can you clarify? Just because you do a Roth ira, it doesn't mean that you live on less than you make. Or am I missing something? Eric?
- [10:06]
Clark Howard
Eric. Okay, so this is the whole idea. Live on less than what you make. So let's say you make, let's just keep it really simple. You make 100 bucks. If you spend that hundred bucks on current living, you're living on exactly what you make. If you use credit cards and you're running interest, you, you're, you're spending more than what you make, right? But if you, in that hundred bucks, you take let's say 10 of it and it goes into a Roth IRA or Roth 401K or could be a traditional of either you're now living on $0.90, $90 out of every 190%. If you're then putting money aside in it rainy day account, let's say you put $5 out of every hundred rainy day account. Now you're living on $85 of every hundred you make. So that's what I mean. When you defer current needs, current spending for needs in the future, that is living on less than what you make.
- [11:14]
Listener
Clark recently said that $19,000 a year can be given with no tax implications. That limit is just the amount that can be given without reporting the gift to the IRS. The actual limit is a lifetime limit of over $13 million. There is no good tax reason for the grandmother in question to stretch her gift out over five years, as Clark suggested. She should feel free to give it all in one year and then file a simple tax form to report the gift against the lifetime limit. Brian.
- [11:40]
Clark Howard
Brian, thank you. And the advice I gave before was based on the possibility of the estate tax going back to a much lower limit. But the tax law, the new tax law means that's not an issue anymore. And right, you just file the gift return. Unless you're Daddy Warbuck sitting with tens of millions of dollars out there that somebody will inherit someday but will pay 45%, I guess, estate tax on the amount over the 13 million. Unless you're in that kind of category. What you said is completely right. Now, under the new tax law, I.
- [12:24]
Listener
Cannot say you stink. But no, I do detect an odor. Today I heard you answer a listener's question about whether or not to tip when getting a takeout order. Let me share my daughter's story. She's a hostess at a local restaurant. She picks up the phone calls, writes down the orders, runs them back to the kitchen, gets them back from the kitchen, and when they're ready to, then she serves them to the waiting customers with a smile. Because she's a hostess at a local restaurant, not a chain, she gets no tips at all. So she's grateful when someone comes to pick up an order and throws in a dollar or two. If everyone did that on a typical night, she'd walk away with at least $10. And that would definitely make her smile. Not sure about chain restaurants, but at local ones, you might want to give that hostess an extra dollar or two for the double duty she pulls.
- [13:05]
Clark Howard
Patty, Patty, thank you for that perspective. And I want to mention something else. There's this thing that people used to carry called cash. And if you slip somebody cash instead of writing on a slip, then you know they actually got the money. When you write a tip on a slip, you don't have any idea what's going to happen with that gratuity. You write in who it's going to go to.
- [13:35]
Listener
And similar, same note, Clark, you stated that you observed customers tipping habits at a carryout bagel shop. I too like to people watch. But with it being carryout orders, isn't there a chance they paid and tipped online? You didn't spend much time on your story, but it left me considering that detail, which is something you lack in many of your explanations. Thank you for that. I still love the show. Michelangelo.
- [13:57]
Clark Howard
Michelangelo, thank you for that. And yeah, so leaving details out, sometimes it's suppositions when you hear me talk about something. And you gave a perfect example about why we do Clark stinks because we all tend to filter things in a way that what we see is not necessarily the whole picture. And I appreciate you sharing a perspective beyond that, just as before about, hey, what's happening to her daughter with doing all the work for the takeout orders and how important it is when her daughter gets that tip that I hope again is in cash.
- [14:40]
Listener
Okay. And this is some additional information for a caller. Clark, you don't stink. The caller situation really stinks. I too was a widower with a 3 year old and an 8 month old. In addition to the advice you gave, please advise the morning dad to contact the Social Security Administration about survivor benefits. There's the real potential that he and or his child is entitled to monthly benefits worth thousands per month. The SSA was very easy to work with and as a widower they sent me to the front of the line. Best experience in a world of challenging experiences. My prayers to him and his child. It's hard to see now, but he will get through this. His child will be just fine. Just be as good of a dad as you can with every breath. God will help you when you're weak. Much love, Troy.
- [15:23]
Clark Howard
Troy, thank you. Thank you so much. I'm really sorry about your loss, what you've had to overcome and obviously the incredible fortitude you've had and positive attitude that's carried you forward. And I appreciate so much you taking the time to share that. And yes, the advice you gave is critical that it's the last thing somebody may be aware of or be thinking about as a parent of young children is that the Social Security system is not just about giving people money in retirement. Sometime between age 62 and 70, there are a lot of other angles to Social Security, including what you're referring to survivor benefits. Thank you very much. Coming up ahead, I want to talk about what's going on as I look forward to Christmas and Christmas pricing and also something you need to know. If you're an Amazon prime shopper, Amazon is hitting your wallet a lot harder right now.
- [16:36]
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- [19:15]
Clark Howard
I got to tell you that Christmas this year is not going to be as crazy pricey as it looked like when President Trump announced the initial tariffs back in April. Because of a long, long cycle of negotiations and a lot of tariffs ending up being less than what originally was expected or announced by the President. That retailers and manufacturers used the time period of uncertainty to heavily get goods into the United States to stock up for the Christmas shopping season. So this Christmas we're not going to see big increases. I mean, there will be items here or there that will have big increases, but for the most part this Christmas is going to be okay. It's not going to be a crazy expensive Christmas shopping season. So that's the good news. The bad news is that next year the tariffs will steadily work their way through the economy and we'll see higher prices. Except if you trust an analysis by the Wall Street Journal, Amazon decided that next year is this year Wall Street Journal looked at over 1000 commonly bought items at Walmart and Amazon. And Amazon has increased prices on the average lower cost item, everyday kind of item. At an annual rate of over 10% raw dollars. The average item is up over 5%. During the same time period, Walmart has cut the price of those items by 2%. So the price gap between Amazon and Walmart has gotten to be quite large. And on everyday items you're really punishing your wallet if you're buying from Amazon and Amazon. As I told you several years ago, Amazon is now a convenient seller more than a price oriented seller. Why do you think they put so much effort into prime days? The whole purpose of that is to create a perception in your mind that you're getting good deals at Amazon. And I shop at Amazon, not a lot, but I do shop there. But a lot of times I basically suffer price shock because I'm such a comparison shopper and Amazon doesn't come close to on a typical item what you'll pay for it at Sam's Club or at Costco Wholesale. I mean Sam's Club and Costco Wholesale. Because of the limited selections they offer and the very no frills nature of their operations, they're able to offer much cheaper prices on stuff day in and day out than you're going to find at Amazon or pretty much most anywhere else. So if you are a convenience shopper and you don't have to have delivery in one to two days, I strongly recommend that you look at being a premium member, what's known as a plus member of Sam's Club. With Sam's Club you get delivery for free on most of what they sell at the same price. You'll pay for almost any of those items in the store ordering online. And all you have to do is your minimum order size has to be 50 bucks. So you order $50 or more merchandise, then you get the opportunity to get much better prices over time. Not every item, but over time, typically at Sam's Club than you're going to get at Amazon. You don't want to be a member of anything. Walmart is clearly a lot cheaper on typical day to day items than Amazon at this point. I mean it's so clear. And Amazon is kind of snippy with the Wall Street Journal reporter who did the story saying, well yeah, you just picked these 1200 items. I mean, what about all these other things? There are certain items that, that people routinely order that are high volume purchases. Those were the items that they compared at Amazon and Walmart. And by the way, remember what I said with Amazon, you know, you're getting pretty much one, two or three day shipping with Sam's Club. Anybody's guess. You order things and I order a lot from Sam's Club delivery. The items can come in a couple of hours or a couple of weeks or somewhere in between. I'd say the most common delivery cycle is five days with Sam's Club. But again that's just kind of an average mix of things that come really quickly and really slowly. So if money matters to you more than the speed of delivery, I recommend that, but otherwise you don't want to be a warehouse club member. Walmart plus gives you a lot of the convenience of the delivery of Amazon but again at a everyday lower price than what you're going to find from.
- [24:55]
Listener
Amazon with Walmart Plus. Is it the super fancy Amex Platinum card that you get the rebate it back to you?
- [25:03]
Clark Howard
That's right. Okay, so you pay a million dollars for the MX Platinum and you get back a lot of that million by.
- [25:11]
Listener
A lot of people. Small business owners use that card. Oh yeah, yeah. So it might, you know, if you have that.
- [25:16]
Clark Howard
But if you, if you are in that mindset where you think Amazon is the only retailer that exists in the marketplace, you're just really hurting your wallet.
- [25:27]
Listener
Daniel in Iowa says I, along with dozens of coworkers were let go this week as part of a downsizing.
- [25:33]
Clark Howard
Oh, I'm so sorry.
- [25:35]
Listener
This is the first time I've ever been involuntarily separated from a company. While this isn't something I plan, with the exception of having several months of expenses saved, I'm Looking at this as a chance to change careers. I'll be 44 next month, so I don't know if it's too late.
- [25:49]
Clark Howard
No, it's not too late.
- [25:50]
Listener
Never. But I've always had an interest in finance and investing. I'd like to become a financial advisor or fee only advisor. I don't have any certifications and I'm not sure of the best way to approach this. I'm not sure if custodians like Schwab, Fidelity or Vanguard or local advisor have on the job training or an entry level program. Any thoughts on this?
- [26:10]
Clark Howard
Okay, so a lot of people do start at one of the big three financial houses and they have a variety of entry systems where you can start off at a not very exciting job. But while you're in it, they will train you for more sophisticated financial roles. Fidelity, if you go look at their system, it is very, very sophisticated based on what your prior knowledge is of finance and investing, how you enter, what different programs you can train for there. And of course, the more training you do over time, the more money you make, the better responsibility you'll have and the more you'll be able to help other people. When you go to individual financial planning firms, there are very specific requirements they're going to want you to have usually already in place. This is a category where look at the big bureaucratic three you're talking about. They all have explanations, none as clear as the Fidelity one about how you can get a job with Vanguard, with Fidelity, with Schwab. But at the same time, I want you to go interview for information with financial planning firms. Stick to ones that do it as a fiduciary. Very important. You don't want to embark on a new career in your mid-40s and go to work for someone who you start questioning their ethics and how they're trying to get you to sell stuff to people that might be really great in commissions for you but terrible for them.
- [28:01]
Listener
Marilyn in Alabama says Walmart plus delivery service has become very popular for only $98 a year. However, they just tried to renew my subscription for $130, which is an increase of 30%. That's a big jump. What's behind this increase and is it still worth it?
- [28:18]
Clark Howard
So the increase they were trying to sell you up to in home delivery, where they come in your home with the items and they put them in a refrigerator or freezer or whatever while you're not home, I've never been a fan of that. So the regular Walmart plus some point I assume they'll raise the price, but it's still 98 bucks a year for it. And the one I thought it's one thing 38 is what they try to sell you up to for the in home delivery option.
- [28:50]
Listener
Janet New York says, my family just returned from a wonderful vacation at an Airbnb rental, and we're all hoping to return next year. In our conversations, the owner mentioned that repeat guests can book directly with him at a discounted rate, saving us about $1,000 during our stay. The owner was very responsive and professional, and I felt confident that everything was legitimate. He has since sent us a sample contract for direct booking, which includes reasonable cancellation terms and payment deadlines. Here's my question. The payment options are Venmo or personal check. I have a separate checking account that isn't linked to our main assets, and my Venmo account is tied only to that checking account. Given the potential savings, is the risk of paying via checker Venmo too high? And if it's a reasonable risk, which payment method would be safer?
- [29:35]
Clark Howard
So, Janet, I'm not worried about which method you would pay this individual. I'm worried about you a year out losing the normal protections you have of your money paying across the Airbnb platform or VR. And if you were doing a vrbo, same thing, paying inside their wheelhouse versus paying direct to a property owner. There are people who do this year after year. You have relatives that were renting a place, Kristie, year after year at the beach. They called their landlord. They were just paying their landlord every year. They were sending the money, everything worked out fine, then the landlord sold the place and that was it. But if you really know this is the owner, you find this person to be really trustworthy. Your only risk is that the person in some way cons you or vanishes or whatever. But yes, people do this every day. They find out about a property, they get to know the owner, and they give up that cushion of protection that comes paying through a big platform like Airbnb or vrbo. You have to make your own judgment whether you feel really, really comfortable with this individual being on the up and up, and you will save a big chunk of money. The money you're saving is kind of like that cushion of security you're giving up. Whether you pay by check or by Venmo, that really is your option. I'm always nervous about checks traveling through the mail.
- [31:13]
Listener
I also just say, like, this is just a little thing. But after, if you do do it privately, after, when they've received the deposit or whatever. I would double check on Airbnb site to make sure they've taken the week off and that's no longer available.
- [31:26]
Clark Howard
Not double selling the week.
- [31:28]
Listener
Right. I mean, I doubt that would happen, but that would just be a little. One little thing I would check just for more legitimacy.
- [31:34]
Clark Howard
Good idea. Yeah. And I've rented enough places over the years that I've had the same thing where the owner of a property has said, hey, why don't you book direct with me instead of through a platform. You always have to know that not anything in life is completely without risk. And you have to do the best you can to determine the level of risk you're placing on yourself by going outside of the safety channel, if you will, paying through one of the big platforms versus paying direct to a unit owner. Well, I want to thank you so much for joining us today. I hope that you have fantastic weekend plans in front of you, though. We are at your service all weekend long, night and day, day and night, whatever you want to say@clark.com clarkdeals.com and our whole thing is to give you knowledge that you can trust to empower you so that you learn ways to save more, spend less, and avoid getting ripped off. And see you Monday.