Unpacking a Rare Vanguard Target Date Fund Problem (SB1637)

Summary

Episode Summary: "Unpacking a Rare Vanguard Target Date Fund Problem (SB1637)"

The Stacking Benjamins Show, hosted by Joe Saul-Sehy and OG, delves into a significant issue surrounding Vanguard's Target Date Funds in their episode released on January 29, 2025. Titled "Unpacking a Rare Vanguard Target Date Fund Problem (SB1637)", the episode provides listeners with an in-depth analysis of Vanguard's recent settlement with the Securities and Exchange Commission (SEC), exploring the broader implications for mutual fund investors, particularly those utilizing Target Date Funds for retirement planning.

1. Vanguard's SEC Settlement and Its Implications [06:50 - 09:42]

The episode kicks off with the hosts addressing a major headline from InvestmentNews.com concerning Vanguard, one of the largest mutual fund companies. At [06:50], Joe introduces the topic:

Joe Saul-Sehy [06:50]: "Our headline today comes to us from investmentnews.com … it’s Vanguard set to pay $106.41 million to settle charges from the SEC for reportedly making misleading statements regarding its target date retirement funds."

The SEC alleges that Vanguard misled investors about capital gains distributions and tax consequences associated with their Target Date Funds. Specifically, Vanguard reduced the minimum investment for its institutional target date retirement funds from $100 million to $5 million in December 2020. This move attracted more investors seeking lower fees, prompting a shift from Vanguard's retail to institutional funds. However, this transition forced Vanguard to sell appreciated assets within retail funds to meet redemption demands, inadvertently creating taxable events for remaining investors. As OG succinctly summarizes:

OG [09:42]: "Because the people left. The people who stayed were left holding the bag, left holding it, as it were."

2. Understanding Mutual Funds and Tax Implications [09:42 - 13:47]

To comprehend the severity of Vanguard's situation, Joe and OG break down how mutual funds can generate unexpected tax liabilities for investors. Joe explains:

Joe Saul-Sehy [09:47]: "Mutual funds don’t tax people. The government taxes people. But the mutual funds have taxable events within them."

Every transaction within a mutual fund—such as buying, selling, or rebalancing holdings—can trigger capital gains distributions, which are taxable to investors even if they haven't sold any shares themselves. OG adds:

OG [10:09]: "Mutual funds have taxable events within them… every time there’s a transaction inside of a mutual fund, that’s a taxable event."

This underscores the importance for investors to be aware of potential tax events when investing in mutual funds, especially in taxable accounts.

3. The Challenges with Target Date Funds [13:47 - 25:05]

The conversation then shifts to Target Date Funds, a popular retirement investment vehicle designed to automatically adjust asset allocations as investors approach their retirement dates. Joe articulates the core issue:

Joe Saul-Sehy [16:51]: "Vanguard allows people into a cheaper share class of this. Mutual fund investors already paying very little, but they’re like, heck, if I could pay less, I’m gonna sell this and buy the other."

This shift led to Vanguard selling appreciated assets within the retail funds to accommodate the inflow into institutional share classes, inadvertently creating tax burdens for remaining retail investors. OG critiques the inherent structure of Target Date Funds:

OG [17:52]: "The major issue with Target Date funds is generally speaking, you’re adding a layer of complexity on top of your asset allocation for no discernible benefit."

He further elaborates on how these funds often become overly conservative too early, limiting growth opportunities for investors. OG likens Target Date Funds to:

OG [18:34]: "It’s like buying a watermelon at the store or buying a watermelon that’s all sliced up in a Tupperware… you jack it yourself."

4. Mutual Funds vs. ETFs: A Tax Efficiency Comparison [14:28 - 25:05]

Delving deeper, Joe compares mutual funds to Exchange-Traded Funds (ETFs) regarding tax efficiency. He points out that ETFs allow investors to own shares directly, often leading to fewer taxable events:

Joe Saul-Sehy [14:28]: "Then there's the difference between mutual funds and ETFs… that's a tax efficiency difference."

OG acknowledges that while ETFs avoid many mutual fund tax pitfalls, they come with their own considerations, such as bid-ask spreads:

OG [14:49]: "It’s the difference between could be a few pennies or a few dimes for most people, but it’s not zero."

5. Listener Call: Tax Optimization for High-Income Physician [39:15 - 47:24]

A crucial segment of the episode involves addressing a listener's query regarding tax optimization. "Dr. Hulk," a 37-year-old physician with a substantial income and significant retirement savings, seeks advice on balancing tax-advantaged accounts with taxable investments. OG and Joe provide thoughtful recommendations:

OG [45:18]: "If I was going to make a change, I would make the change to be more Roth 401k focused… drip that in over the next little bit."

They suggest gradually shifting contributions to Roth accounts to manage tax liabilities while maintaining flexibility. OG emphasizes the importance of starting early with tax planning:

OG [46:55]: "Starting earlier is better than starting late."

Joe reinforces the value of understanding the mechanics behind investment choices to avoid unintended tax consequences:

Joe Saul-Sehy [13:21]: "Mutual fund owners often end up paying taxes they didn't anticipate because of internal taxable events."

6. Key Takeaways and Conclusions [29:56 - 51:58]

Throughout the episode, the hosts highlight several essential lessons:

1. Evaluate Target Date Funds Critically: Understand the underlying asset allocations and potential tax implications rather than relying solely on automated investment vehicles.

2. Consider Alternatives for Tax Efficiency: ETFs may offer a more tax-efficient alternative to mutual funds, though they come with their own trade-offs.

3. Be Proactive with Tax Planning: Investors should be aware of taxable events within their investment vehicles and adjust strategies accordingly to minimize unexpected tax burdens.

4. Start Early with Financial Planning: Early and informed investment strategies can provide greater flexibility and mitigate risks associated with market fluctuations.

Joe Saul-Sehy [50:27]: "Don’t ask Joe’s mom about a round of hot chocolate, because she’ll start singing that song from Polar Express… keep it cooking in the pot.”

7. Additional Insights and Community Engagement [51:58 - End]

The episode concludes with lighter segments, including trivia and community interactions, fostering a sense of camaraderie among listeners. Joe and OG encourage audience participation, inviting listeners to share their own financial stories and questions.

Notable Quotes:

• Joe Saul-Sehy [09:47]: "Mutual funds don’t tax people. The government taxes people. But the mutual funds have taxable events within them."

• OG [17:52]: "The major issue with Target Date funds is generally speaking, you’re adding a layer of complexity on top of your asset allocation for no discernible benefit."

• OG [45:18]: "If I was going to make a change, I would make the change to be more Roth 401k focused… drip that in over the next little bit."

Conclusion

This episode of The Stacking Benjamins Show offers a thorough exploration of Vanguard's recent challenges with Target Date Funds, shedding light on the intricate relationship between investment choices and tax implications. By dissecting Vanguard’s strategy and its fallout, Joe and OG empower listeners with the knowledge to make informed decisions about their retirement planning and investment strategies. The episode underscores the importance of understanding the tools at one’s disposal and advocates for proactive financial literacy to navigate the complexities of personal finance successfully.

For more detailed insights, additional resources, and information on upcoming episodes, visit stackingbenjamins.com.

Transcript

[Joe Saul-Sehy]

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[OG]

We are back we are back we are getting Doug back and we're the three best friends that anybody could have.

[Joe Saul-Sehy]

We'Re the three, three best friends that anyone could have we're the three best friends that anyone can have and we'll.

[OG]

Never, ever, ever, ever, ever leave each.

[Joe Saul-Sehy]

Other we're the best.

[Doug]

Live from Joe's mom's basement, it's the Stacking Benjam. I'm Joe's mom's neighbor Doug and one big mutual fund company is in the news. Is it Vanguard?

[Joe Saul-Sehy]

Maybe.

[Doug]

On today's show we'll share lessons about target date funds, tax planning, retirement planning and switching accounts. And in our TikTok minute one, mom finds out she's apparently way more wealthy than she ever thought. Plus, we'll answer a question from one stacker who thought, you know, I'd better call Saul. See? Hi and OG with my question about tax optimization. Great thought stacker. And you know what else is great? A scoop of my world famous trivia, that's what. And now two guys who want you to have enough money to live your dreams and still buy popcorn at the movies. It's Jo and oh Ja.

[Joe Saul-Sehy]

J J J J.

[Doug]

Joe, nobody goes to the movies anymore and buys popcorn.

[Joe Saul-Sehy]

You know how great of all to escape to a movie theater for a couple hours. It is just amazing. But second, imagine buying popcorn like seriously and not having to refinance your house. I mean, how, how wealthy are you, Doug?

[Doug]

You know who else tried to escape to a movie theater? Lee Harvey Oswald. Joe.

[Joe Saul-Sehy]

Did he. Is that a fact? Is yeah.

[Doug]

That's where they caught him.

[Joe Saul-Sehy]

What was it? Was it really?

[Doug]

Yeah.

[Joe Saul-Sehy]

Wow. Hey everybody. Welcome to Trivia. Joe didn't know for the win.

[OG]

Joe, do you get the large popcorn at the Cinemark or do you get the small with the free refill?

[Joe Saul-Sehy]

There is no see at our Cinemark you have to get the large to get the free refill.

[OG]

So what do you do?

[Joe Saul-Sehy]

I just get the small now because I will eat the large and then I will feel ashamed of myself the rest of the day.

[OG]

Very salty for the rest.

[Joe Saul-Sehy]

Incredibly salty. Oh, such a great Wednesday. Welcome to the Stacking Benjamin show and we're super happy you're here. We've got a potpourri of exciting topics today, an amazing headline and Doug, it looks like we've got an action packed agenda looking at the all the stuff going on today schedule. We're going to teach people a ton about your money and about investing, which I know is a lot of our stackers. Favorite topic to talk about that. Oh, gee, having a good midweek today?

[OG]

Oh, yeah, it's fantastic.

[Joe Saul-Sehy]

Is there a specific reason why or is it just because you're here with us?

[OG]

Oh, I believe it is because I'm here with you.

[Joe Saul-Sehy]

There you go.

[OG]

That's what the cue card says here.

[Doug]

And we're not sure yet but could maybe be because I'm here with you guys. Get back to me on that.

[Joe Saul-Sehy]

We're about to find out in the next hour, Joe, whether I like it here or not. All right, one big mutual fund company in the news. We're going to get to them next with our headline. But before that, we have a couple of sponsors who make sure that we can keep on keeping on and you don't have to pay anything for this. Goodness. So let's hear from them and then into a boo boo from a big mutual fund company. Ah, debt. Well, it can take a toll on you. Between minimum payments and interest rates, it's really stressful and at times feels like you just can't get ahead. Navy Federal Credit Union understands debt is a huge stressor and they're here to help. Navy Federal Credit Union has all the financial tools and resources you need to dominate debt right now when you're putting your strategy together. One strategy I like is to surf your interest rates down to zero and continue to pay as little interest. To quote the man as possible. Navy Federal Credit unions offering a 0% intro APR on credit card balance transfers for 12 months. Plus you can get $250 when you spend $2,500 in your first 90 days on a cash rewards or cash rewards plus credit card. So lay out your plan, figure out how to use the tools, and don't let debt drag you down. Visit navy federal.org to start dominating debt today. Navy Federal Credit Union Our members are the mission Navy Federals insured by NCUA after the intro rate expires. Variable APRs are 15.15% to 18% based on creditworthiness. Rates are subject to change. ATM fees for cash advances are up to $1 at non Navy Federal ATMs.

[Doug]

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[Joe Saul-Sehy]

This high.

[Doug]

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[OG]

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[Joe Saul-Sehy]

Hello darlings.

[OG]

And now it's time for your favorite.

[Progressive Insurance]

Part of the show, our Stacking Benjamin's Headlock.

[Joe Saul-Sehy]

Our headlines today comes to us from investmentnews.com this is a website for kind of for industry insiders. We like it if you're new to the Stacky Benjamin show because here they often talk about lots of topics that are a little different than what I see in most of the things that are in the popular press. It's really what the pros are worried about and apparently what the pros are worried about right now is a little company called Vanguard. OG okay, because Vanguard getting their hand slapped by the SEC. This is written by Leo Tolstoy DiCaprio, Alma Zora, probably a cousin. So close of those people. Just a bit outside to quote Bob Euchre. Oh my God, that guy was funny. His sense of humor. Bob Euker died what, two weeks ago? Just fantastic article Joe Artificial fantastic sense of humor. Anyway, try the corner and missed just a bit outside. Vanguard set to pay $106.41 million to settle charges from the securities and Exchange Commission for reportedly making misleading statements regarding its target date retirement funds. Vanguard not a company where we've had. I can't remember us ever having a Vanguard headline like this. In an order published last Friday, the SEC said Vanguard misled investors with respect to capital gains distributions and resolving tax consequences for retail investors who held those target retirement funds and taxable accounts. So this is what happened. OG this is also what happens when you are a company that is the low cost provider you attract a lot of people who are very naturally fee adverse. And the second that you offer something with an even lower fee, people. People tend to go that way. Here's what happened. Vanguard in December 2020, decided to lower the minimum investment for its institutional target date retirement funds from a hundred million dollars to five million dollars. So now if you've got five million bucks, you can go into the institutional one. Of course, the institutional target date retirement fund has a lower fee than the investor class retail version, right? Yeah. Target retirement fund. So because it had lower expenses, people moved out of the retail version and into the institutional version to meet the demand from redeeming investors. The SEC said Vanguard's investor target date funds then had to sell underlying assets that it appreciated in value. The retail investors who stayed in the funds and held shares and taxable accounts, bam. They were effectively punished because Vanguard lower.

[OG]

Because the people left. The people who stayed were left holding the bag, left holding it, as it were.

[Joe Saul-Sehy]

There is a lot to unpack here. I want to talk about all these things, but first of all, let's talk about how mutual funds tax people so we can understand why this is a big deal. Because if you're out there maybe buying a mutual fund and it's not inside of a retirement account, OG you might be caught, maybe not in this situation, but you may be caught wondering, why do I have to pay tax when I didn't sell anything?

[OG]

Yeah. Mutual funds don't tax people. The government taxes people. But the mutual funds have taxable events within them. Right. And that's the struggle bus. I remember, Joe, you and I have a friend at Ameriprise from our Ameriprise days who had inherited a relationship. It was, you know, an advisor who had retired or somebody who. Who had left the firm. And this person inherited this account and was super excited by it because it was a big number. It was a $700,000 account. It was in one mutual fund. And then that year, that mutual fund had a 50% capital gain distribution. Oh, man. And you go, well, what the heck does that mean? That means that this person had on their tax forms, it's as if they sold $350,000 of gain. It's as if they had $350,000 of gain. And so the way that this works inside of a mutual fund is that there's all the different stock holdings, and the mutual fund owner or the mutual fund manager is buying and selling and rebalancing and that sort of thing with maybe an eye toward taxes or maybe not. You Know, it depends on, you know, what their stated goal is. But their main objective is whatever. Their main objective is capital appreciation or dividends or whatever they say it is. And every time that there's a transaction inside of a mutual fund, that's a taxable event, just like it is in. In your investment account, if you buy Apple and then sell it, it's a taxable event. Either that's a tax gain or a tax loss, and you aggregate those at the end of the year. And the same thing happens in a mutual fund. All that stuff happens throughout the year. And then at the end of the year, they aggregate it all up and go, well, how much did we have in gains or losses? In a perfect world, it kind of nets out to. Even in years where the market is skyrocketing and going gangbusters or whatever, sometimes there's a gain, and then they just distribute that. They say, well, we made $100 million. We have 100 million shareholders. Everybody's getting a dollar of capital gains, and it's just assigned to you. So you just get a tax form that says, oh, by the way, you made a dollar or you made $1,000, or in this lady's case, $350,000. Even though you didn't do anything, it's because of the stuff inside of it. The other complication is it's indiscriminate in its assigning. It's literally whoever owns it, the day that they assign it, you say, well, I just bought it yesterday. You go, yeah, we don't care. You have it today. You're in the club. Welcome to the club. You're paying the tax. You're part of the organization here. So if you're going to invest in money in a mutual fund and you're getting toward the end of the year, it's one of the steps that you have to take of paying attention to when are those capital gain distributions being issued and do I want to be a part of it? Is it a big enough deal for me to. To pay attention to that? And I've seen people get burned by that, too. You know, put in bonus at the end of the year, you know, they get their bonus and they go, let's invest the money. And they invest it. And wait a second. I had this fund for five minutes, and I'm paying $10,000 in taxes. What the heck?

[Joe Saul-Sehy]

What happened?

[OG]

Welcome to the party, pal.

[Joe Saul-Sehy]

The good news is this information, if you know to look for it, is all public record. And if I remember right, it comes out generally about A month before the day that they're going to have the capital gains distribution date. Is that about right?

[OG]

Yeah, I think, you know, most companies try to get it wrapped up by the middle of December. So sometime around Thanksgiving or maybe even earlier than that, you know, they, they sent an estimate. Right, because there's still trading that's happening between, you know, the time that they issue the publication and beyond. And if it's a big enough trade, you know, if you're going to say, hey, I'm going to go buy a million dollars worth of this mutual fund, I would get on the phone with the fund company and say, I'm, I'm about to buy a million dollars worth of your thing. Is there anything I should be aware of? They'll say, oh, you might want to hold off till December 19th instead of buying at the 17th, you know.

[Joe Saul-Sehy]

And on the other side, if you are thinking about selling the fund and you're fairly certain you're going to sell the fund and it's not inside an IRA and they're going to have some type of capital gains distribution, some distribution that comes out, sell it before that day. Like, like don't stay on the hook for capital gains tax for that year. I think this might be just a problem of the fact that because mutual fund architecture sold, it's from the 1940s, a much more tax efficient way to go then would be an exchange traded fund. Because exchange traded funds, og will avoid a lot of these issues because you directly own a share like you own a share of stock.

[OG]

I mean it avoids all of those issues, but it picks up other issues. It's not a get out of jail free. You can just go, yeah, oh, this is a free way to do it. It's an unknown. It's very behind the scenes and it's very 201301 in terms of the bid ask spread. We talked about this before the bid ask spread. You're doing what?

[Doug]

That's a bid ask spread.

[Joe Saul-Sehy]

Hey.

[OG]

Oh, it's really the price that you see quoted versus the price that you get filled at. And for most people we just don't pay attention to that or care about it. And honestly it's probably an insignificant amount, but it's not zero. It's the difference between could be a few pennies or a few dimes for most people, but it's not zero. And so that's really the trade off. Is it better to have the tax bill of the mutual fund or the spread risk of ETFs since most people don't pay attention to that, honestly. And it's like internal tax versus an external tax, so to speak.

[Joe Saul-Sehy]

Yeah.

[OG]

I think most people would be okay with the fact of paying the thing that they don't know that they're paying because they just go in online and said, buy me 100 shares of SPY and life is good.

[Joe Saul-Sehy]

I had to warn mom about that when we bought shares about a month ago. I told her, I said, with the second we buy this, it's going to look like we lost money. Just so you know, the second we buy it, it's going to look like we lost money.

[OG]

And sure enough, it doesn't look like you lost money. You lost money. You lost money that second you did. Yeah. Correct.

[Joe Saul-Sehy]

The second you purchase. Yeah. You're like, what happened there? Yeah. A loss of money. Where did that go? The brokerage firm kept it.

[OG]

Yeah. Ether it went into the. That's your, that's your mutual fund tax that you didn't pay.

[Joe Saul-Sehy]

There it is. So that is problem number one that Vanguard ran into. Just to go back through this maybe a little bit in slow motion. Vanguard allows people into a cheaper share class of this. Mutual fund investors already paying, oh gee, by the way, very little. Just paying very little. But they're like, heck, if I could pay less, I'm gonna sell this and I'm then going to buy the other. This other fund that costs less. Those people had a tax on their end. Right. I mean, if they'd held it for a while og they're still gonna have to pay a tax for the thing that they did. If it's in a non IRA account, just a regular brokerage account.

[OG]

Yeah. The people who move from the higher cost to lower cost, you're saying.

[Joe Saul-Sehy]

Yeah.

[OG]

At a taxable event of selling the thing. Yeah, quite possibly that's the case. I don't know if this is the case in this circumstance. Sometimes by changing share classes, they don't make that a taxable event. I don't know how Vanguard did it in this case, but it sounds like the vast majority of the situation was because of the fact that they, they, you know, the rich got richer. In this case.

[Joe Saul-Sehy]

Yeah.

[OG]

You would expect left all the pain with the people left over. All those poor people with under 5 million.

[Joe Saul-Sehy]

Under 5 billion, you would have expected that those people would have a tax. So the surprise was because they had to sell a bunch of stuff internally. Even though you didn't sell, you ended up with a tax. There's another thing here which is it's a target date Fund because it's a Target Day fund. OG there's several different funds inside of this one fund, which also is something I know that you and I talked about before. We really don't love this architecture of the Target Date Fund. Like having all these funds mixed up in one place. You want to dive into that for a moment?

[OG]

Well, the major issue with Target Date funds is generally speaking, you're adding a layer of complexity on top of your asset allocation for no discernible benefit. I don't know that the allocation is correct or incorrect, and I don't really care. But the major problem that I have with it is twofold, which is to have somebody package it together for you is going to cost extra. It's the buying a watermelon at the store or buying a watermelon that's all sliced up in a Tupperware. You know, go look at the insane difference in price of buying the whole thing or having someone package it for you. It's like a watermelon's a dollar, or you can get a couple of slices of watermelon for 3.50.

[Doug]

Oddly specific example. He just chose Joe.

[Joe Saul-Sehy]

This is, by the way, Len Penzo's favorite thing to rail against. He's like, cost to slice up a mushroom.

[OG]

Yeah, exactly. So, you know, there's always going to be an extra layer of cost there. So for everybody who's goo goo gaga over fees, it's like, why the hell would you pay an extra whatever to have somebody slice up the fruit for you? You jack wagon, you know, do it yourself.

[Doug]

Anger in there is there also, do they tend to be a little more conservative than necessary or a little more aggressive than necessary? Is that another downside?

[OG]

Yeah, I mean, so the first thing was the packaging. And the second piece is you end up on this glide slope of conservativeness that ends way too early. And it's somebody else's schedule. And the idea is this fallacy. I think people have. I had a conversation with somebody this week that he was a young guy, and he's like, well, when should I get conservative in my portfolio? I'm going, what are you talking about? Never. Why would you want to. And I, you know, I'm going to keep on beating that drum until we get rid of fixed income as an asset class for the mainstream America, because you're purposefully putting an anchor in your portfolio to slow down the growth of your. Of your account. I don't understand why you would do that. And especially I don't understand why the hell you would do it starting at 45 or 50, you know, oh, thank God I finally got enough money. That's going to start compounding. Let me stop compounding it. I don't. That doesn't make any sense to me. And I understand people say, well, you need, you know, you got to be conservative when you get to retirement. No, you need to have liquidity for the first year or two to avoid any major meltdowns in the market. Unlucky phase of retiring. The guy or gal who retired January 1st of 2008 was unlucky in their timing. Right. You didn't know on January 1st that the world was going to implode in a gigantic recession for three years. But having cash on hand to withstand that would have been okay because then the market recovered, you know, the S and P in March of 2009 was 656,000. Now it's freaking 10 times. Like, why would you want it? Why would you have any interest in letting off the gas if you've already seen this happen in your lifetime, you know that it's 10x twice. Why would you go, well, I don't want to do that anymore. That was. I'm good, I don't need to do that. So target day funds tend to get conservative early and then drive you into this ultra conservative portfolio. Right. When you need to be having that, like we like to call it that final double, that last chance that you have to have your money grow one more time to do that, one more compound from 53 to 60, you go, all right, this is the final multiplier before I'm gone. And Vanguard and all these other places go, ah, now you're good. Just let off the.

[Joe Saul-Sehy]

And I think part of the reason that they're overly conservative as well is kind of like what reporting on here. Vanguard OG gets gets this huge settlement for something that appears to me on the outside to be an unintended consequence, right? Just a complete unintended consequence of trying to allow people to do a less expensive option. I mean, think about this. Vanguard's like, hey, let's let more people do the, the not as expensive thing. Okay, here's a hundred million dollar.

[OG]

I mean, I don't know that that's the reason the conservative target date thing happens. I think it's more of a cultural relic from something from some time ago where people said you have to be bonds minus your age. And this is still hanging on despite all of the evidence to the contrary. And for as much as I'm concerned about the youth as it relates to Market corrections and the fact that they haven't really seen any in their lifetimes and when they do, they're going to puke any significant ones anyway. I'm still flabbergasted by the fact that people will have seen what they've seen over the last 15 years of their investing lives and go, yeah, I should be conservative, right? It's like, if nothing else you've learned, don't be conservative like that. That I would think would be the message that people have learned over the last 15 years is why would I invest in anything other than the equity and ownership of the biggest companies in the universe? Despite seeing that people go, well, I'm close to retirement, I should start being conservative now. Don't do that.

[Joe Saul-Sehy]

I had a great meeting with a stacker last week who was talking about the fact that she hadn't really considered enough that retirement, to state one big goal people have is not an event. It's still going to be X number of years of your life. And I think everybody thinks, okay, maybe.

[OG]

A third of it if you're lucky.

[Joe Saul-Sehy]

Yeah, I got to get conservative when I hit that number. No, you need some money where you can can get at it, but you still have this money you need as a growth engine for those later years.

[OG]

I mean, I think about it even in a bigger picture, which is you get to age 60, you've got 3 million bucks in your account, you're like, okay, cool, 4% rule of 10,000amonth. I'm going to be great. That's all good and grand and wonderful and all, But a, that 10,000 has to grow with inflation, right? It's not 10,000 for the rest of your life. So you need to make sure your money's in a place that's going to grow with inflation. And secondarily you're finally at a place where like you're seeing some major, major increases in your portfolio year after year after year. And think about the next generation or the second generation. Not maybe your kids, but your kids kids and the fact that they have a 60 year time horizon or 80 year time horizon before your kids. Kids need the money like your grandkids when you're 60. How old are your grandkids? Five. Like they have a 60 year time horizon like my God almighty, like invest in the Future. You have 60 effing years for your grandkids. Imagine if grandma and grandpa would have put 3 million in an account for you. How much would that be worth? What was the S and P@50 years ago?

[Joe Saul-Sehy]

This is When I get what was.

[OG]

The S and P at when you were born?

[Joe Saul-Sehy]

Yeah, this is when I, God Almighty, when I roll my eyes a little bit as well, is when I hear about people saying, well, you know, if you're 75 years old, you shouldn't be in growth stocks. And I think, well, if you start off with what the money's for, to your point, if it's not for your.

[OG]

Family, you will be absolutely.

[Joe Saul-Sehy]

If it's not for you, if it's for your family, for the wealth of the people after you, then hell, yeah, you want to be in growth stocks when you're 75.

[OG]

And for you. Because at 75, you still need money when you're 85 and 95, probably statistically. So you need it for you, but you damn sure need it for your kids and grandkids.

[Doug]

The thing people are worried about is in a growth stock is the higher likelihood of the crash. When you're 85 and you need that money and you can't. They. You don't think you can withstand the $50,000 hit because that growth index just crashed. That's what I think people are worried about.

[Joe Saul-Sehy]

I mean, that's why you start off with, when am I going to spend the dollar? Right? And you work backwards. This is why you start off with the date that I'm going to need the dollar and then go back. That's how you mitigate that risk.

[OG]

And I think there's a second piece to that, which is when you retire, let's say you're 65 and you're financially independent and you're good, right? You're not great, but you're good. You're the proverbial 4 percenter. You got your 2 million, you're going to take 80 grand. You know, that sort of thing. You're in that area where, to your point, Doug, if the market does go down 30% and you're all in stock, you're going to feel pretty freaked out. Your 2 million turns into 1.2 in a hurry, and you're like, whoa, whoa, whoa. You have to have an insane faith in the future that it's going to be okay. But the corollary to that, the opposite. I think that the effect of that happens is that if you do the right thing when you're 65 and that money doubles twice by the time you're 85 and now you have $8 million and you're still managing your lifestyle, you're living your life, you're doing your thing, you're so far ahead of the curve at that point that it doesn't matter what happens. Like if the market goes down 30% and you have 8 million bucks and you're spending a hundred $200,000 a year, you have so much excess, we call it margin of safety. You have so much margin of safety, it doesn't matter. And that's really the goal is to kind of get through that surf zone, that little bit of time where being unlucky will affect you. And there's no way to predict that. There's no way to know that you're the January 1, 2008 guy or gal. It just. It just is unlucky. So the way to protect against it, or to Joe's point, to mitigate that is to say I need to have two years worth of cash available in case I have a 20% decline. If early on I got a 20% decline, I got to live on my cash for two years and let my portfolio do its thing. I got to be okay with it going from 2 million down to 1,200,000 and let it ride and let it get back to 2 million, because eventually it will, and I just have to give it time. And if you're. If you're unlucky and that happens too early, so be it. You've got the cash to support it if you're lucky, and it doesn't happen until you're 10 or 15. You have so much freaking money. You're so far above that glide slope, that margin of safety, that 20%, 30%, 50%, like, who cares? It sucks. If you have $4 million and it turns into two, you're not going to be excited. You're not going to be have a happy day. But from a financial standpoint, you're okay. So that's really what you have to mitigate, is that first 3 years or 5 years of being unlucky.

[Joe Saul-Sehy]

I want to backtrack too OG to one other thing you said, which is the Target Date Fund adds a layer of complexity, which I know a lot of people think that adding a Target Date Fund makes things easier, right? It's easy. Oh, I'm just going to let somebody else handle it. But there truly is so much going on under the hood that you don't understand. I think you're proving to yourself that I'm not smart enough. I don't understand how this works. And if you can take half an hour or an hour figuring out how this works and you don't have the Target Date Fund, your plan becomes stickier and you're much less likely to bail on it when things go poorly. I do not like these magic solutions. I get tired of hearing people go, oh, which Merriman portfolio do I pick? Why am I picking this magic portfolio with this magic person? You know, do I pick a Rick Ferry portfolio? What's the portfolio that I pick? The second that you think somebody's a magician and it doesn't go the way that you want because you don't understand what the hell Rick Ferry's doing under the hood or Paul Merriman's doing under the hood, you're, you're more likely to bail. Drives me, drives me crazy when we, when we do that and we do the same thing with target day funds on a much, much bigger level. Right. So whether you're a nerd or somebody that starts out and thinks that you're not smart enough, yes, you are. You're, you're way smart enough.

[OG]

And I think it is Stuart Small, you're good enough. Damn it, dog.

[Joe Saul-Sehy]

Kind of like, absolutely. All right, we'll dive into more on this topic. I love this headline because of all the different areas we covered. I mean, we talked about diversification, getting a little bit under the hood. We talked about tax implications and mutual funds and exchange traded funds. There's so much here in just one seemingly simple headline that I really like. We'll link to it in our show notes@Stacky Benjamin's.com if you want to read it for yourself. In just a moment, we are going to have our tick tock minute and we'll answer a call from a stacker who's wondering about tax optimization. We're gonna do all that.

[OG]

Don't buy Vanguard.

[Joe Saul-Sehy]

Doug's. There's our lesson, Doug Scott. In this case, no. Apparently Doug's got some trivia though. Doug, what's untapped today?

[Doug]

Hey there stackers. I'm Joe's mom's neighbor Doug and it's Oprah Winfrey's birthday today. You know what that means? You get a car and you get a car and you get a car. Okay, sorry, I did that wrong. I mean, I wasn't promising cars to both of of our stackers. I was just doing the whole Oprah thingy where she says the UK never mind on today's date. Speaking of cars, a Mannheim, Germany based car creator patented his first successful gasoline driven automobile engine on today's date, way back in 1886. Here's the question. What was his name? I'll be back right after I go fill up OG's Mercedes with fuel that should make them less grumpy. Yeah, right.

[Progressive Insurance]

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[Joe Saul-Sehy]

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[Doug]

Hey there stackers. I'm Gas go getter and guy who celebrates getting gas with some ice cream, Joe's mom's neighbor Doug. You know, I mean, you can't resist.

[Joe Saul-Sehy]

I see what you did there.

[Doug]

Those great stores in there with all.

[Joe Saul-Sehy]

The good healthy food, gas and ice cream. Sounds like some lactose intolerant going on.

[Doug]

Yeah, they sell Imodium too. You know how Oprah likes to give away cars? Today's trivia question is about a German car manufacturer whose company has made lots of Benjamins. Well, back then they were Franks or Franks or probably Deutsche marks. I don't know, but I guess now they're Euros. Here was the question. What Mannheim, Germany auto manufacturer patented the gas powered engine on today's date back in 1886? The answer? It was none other than the great Karl Benz. That's Karl with a K, whose name now of course represents half of the Mercedes Benz name. Hey Oprah, if for your birthday you'd like to give me a Mercedes Benz. I'm in. I'll even go on camera for that. And now back to the guys driving this podcast, Joe and og.

[Joe Saul-Sehy]

Oh, how great would that be? You get a Mercedes and you get a Mercedes.

[Doug]

I don't want one.

[Joe Saul-Sehy]

Oh, but I gotta pay the tax on it. I don't want to pay the tax. Yeah, that's where they get you is on the tax.

[Doug]

That's how they get you.

[Joe Saul-Sehy]

Interesting. Carl Benz.

[Doug]

Yeah. You know, Mercedes was actually his daughter. That's where the other half of that came from. He named it after his daughter.

[Joe Saul-Sehy]

Ben's did.

[Doug]

Yeah, I think so. We should look that up, but I think so.

[Joe Saul-Sehy]

Yes, I'll let you look it up when we get on with the Tick Tock minute. Doug, this is the part of the show where we shine the light on a Tick Tock creator is doing something brilliant. Or air quotes. Brilliant. I love the steam coming out of OG's. Oh, geez.

[OG]

Life was so good for that little bit of time. Do you remember that back a couple weeks ago?

[Joe Saul-Sehy]

Remember we had that day when all.

[OG]

That time people were like, oh, I guess I have to do something else other than sit on my phone.

[Joe Saul-Sehy]

Oh, you'll love the latest conspiracy theory on Time. They're like, they had to change over the servers so that all of the people got together, something involving Mark Zuckerberg, and they were changing over the servers. And so they shut it down long enough so they could do that. They ostensibly said, we're shutting it down. No, we're not. And allowed them now to really, really work against us as if they were before some people with way too much time on their hands. Ostensibly me.

[OG]

I was gonna say. You were. You were pretty in a. Your panties were in a twist when Tick Tock went down.

[Joe Saul-Sehy]

It was crazy. Hey, here's somebody who. Who, well, it turns out OG she thought she had way more money than she did. At least her. Her kids thought she had way more money than she did.

[OG]

Okay.

[Progressive Insurance]

I realized today that my 3 year.

[Joe Saul-Sehy]

Old thinks we own the Buffalo Bills. Every time I go to work or my husband goes to work, they always ask how come you have to go to work and you can't stay home? And of course we say we gotta pay the bills. So today my husband's at work and.

[OG]

I'm at home with the kids.

[Joe Saul-Sehy]

And somebody asked how come daddy didn't have off this week? And my 3 year old said, because.

[OG]

He has to pay.

[Joe Saul-Sehy]

Josh Allen. I didn't know that that's how that worked.

[OG]

Pagula's.

[Joe Saul-Sehy]

I'm coming for your job. She owns the Buffalo Bills, apparently. That was hilarious. Jane. Nice work. If you see something either interesting, wild, or, well, to Og's point, some weirdness online.

[OG]

Talk. Talk.

[Joe Saul-Sehy]

Yeah, Speaking of some interesting things on social media that may or may not be true, we gotta. We received a note on Instagram from Matt Julian. Matt found something on Instagram Og that, you know, looks pretty legit. This person wrote that you can do remote triaging. Online is a job. Are you familiar with remote triaging? Listen to this. As a remote Triager, an online sales rep, your job is simple. You reply to DMS on behalf of business owners and book sales calls, or you help take those calls. Once a deal's closed, you can make upwards of $250 to a thousand dollars for every deal. Beginners are making three to ten thousand dollars per month and they work three to four hours a day.

[OG]

Sweet.

[Joe Saul-Sehy]

Yeah, it's good work if you can get it. Thanks, Matt. It doesn't sound scammy at all to me. Remote Triager. Remote Triager. So good.

[OG]

Don't even have to go to medical school. No, that's a broken arm.

[Joe Saul-Sehy]

Technically, you don't have to.

[OG]

I got it broken. Wait.

[Joe Saul-Sehy]

If I know what that is.

[OG]

Next. Next.

[Joe Saul-Sehy]

I'm exhausted from that.

[OG]

You definitely have tetanus. That is a nail in your foot. Next. Wow.

[Doug]

I haven't seen goiter in years.

[Joe Saul-Sehy]

I think you've been bit by a squirrel. So many. So many things, Doug. Apparently. Speaking of that, you don't need to be a doctor to pontificate about the trivia and where the name Mercedes came from.

[Doug]

No, you can just make it up. But when I say it, it sounded like I knew what I was talking about, Right?

[Joe Saul-Sehy]

You said it with confidence.

[Doug]

I know. That's the key to everything. And I mean, I was in the neighborhood, but as it turns out, Mercedes was somebody's daughter. But not Carl. Benz's Carl with a K. There was another guy who, way back when, in the early days of Daimler and Maybach, who were building these vehicles. It was a dude named Jelinek who would buy them and then turn them into race cars. And it was his daughter, Mercedes Jelinek, where the name Mercedes came from. So, I mean, it's very complicated. There were a bunch of German engineering guys involved, but it was this Jelinek guy's daughter, Emil Jelinek, who was making race cars out of Mercedes.

[Joe Saul-Sehy]

And imagine, she just got her name on a brand forever and ever.

[Doug]

Yeah. And I think she was kind of like the woman who designed the Nike Swoop Swoosh. I don't think Mercedes, she got nothing out of it.

[Joe Saul-Sehy]

How much did the Nike Swoosh person get paid? Off the top of my head, I think that was like 80 bucks.

[Doug]

Yeah. Somewhere less than a hundred. For sure.

[Joe Saul-Sehy]

Yeah. Let's go to something that we do know the answer to, which is overrated. We can answer. We can answer somebody who said, you know what? I better call Saul.

[OG]

See?

[Joe Saul-Sehy]

Hi and OG this is a part of the show where we help a stacker in need. And this stacker wanted to be anonymous. So let's say his name is OG what's the name of your favorite wrestler?

[OG]

Hulk Hogan.

[Joe Saul-Sehy]

Hulk. His name is Hulk. Hey, Hulk.

[Hulk Hogan]

Hey, Joe and OG I'd like to get your opinion. Doug, you can keep your opinion to yourself. I don't trust your decision making capacity after what I've seen at the Sizzler. So here's my question. At what point do you give up tax optimization for flexibility? I'm a 37 year old physician with a total household income of about $380,000 a year. I have a 403B and 457. My wife has a 401K, all of which we max out. We Also max an HSA, two backdoor Roth IRAs and fund our kids 529s up to the state tax deduction limit each year. My employer also graciously puts $40,000 each year into my 403B. All said and done, I can save about $140,000 or about a third of my total compensation into tax favored retirement accounts. All accounts have good investment options and our only Debt is a $500,000 mortgage at 2.75%. We currently have about $650,000 saved in pre tax, 200 in Roth, 30 in HSAs, 30 in taxable, and about 60 in cash for an emergency fund or opportunity fund as Joe likes to call it. So my question is, when do I start optimizing for flexibility? I figure at some point I should start putting more money in taxable. But it pains me to pay more in taxes than necessary. My thought is to keep doing what I'm doing for the next five to 10 years, then back off of my pre tax accounts to focus on taxable and paying on the house. What are your thoughts? Also, should I get a shirt that fits me now or a shirt that I aspire to fit into? Maybe that can be a question for your next Better call Saul. See? Hi. Anyway, thanks.

[Doug]

See Ya, I mean, I order shrimp one time at the Sizzler and suddenly my decision making is called into question.

[Joe Saul-Sehy]

It's time to reflect on those decisions. Time to reflect, Doug. Hey, Hulk, thanks for the call. I don't know if I can call it.

[OG]

Dr. Hogan.

[Joe Saul-Sehy]

Dr. Hulk to you. Yeah, Dr. Hogan. I would love to have his problem. It's a fantastic problem to have. Doing a great job of saving, able to put a lot of money away. But, oh, gee, it is a great question. When do you look at tax flexibility versus, you know, trying to avoid the tax ban as much as possible today?

[OG]

Well, I think the easiest solution to all of this to kind of keep the contributions the same would be to flip 403 or 401 contributions to Roth. You know, since you have so much money coming in pre tax from your employer matching contributions, maybe your spouse has employer matching contributions also. Those are going to be pre tax and you also have a big pre tax bucket already. That's kind of the flexibility that I would look at is just flipping those numbers from all being pre tax to maybe some of your contributions being Roth. The reality is that at the end of the day, there's no free lunch if you stop all of your contributions. And let's say you're out there maxing out your 401k right now and you're putting in the 235 and you say, well, if I put that in my Roth instead, isn't that better? And it might be better than today, but I do know for a fact that it's going to cost you 6 or 7 or $8,000 in taxes today. You know, your taxable, your tax bill rather is going to go up by a bunch because you're going to have another $24,000 of taxable income compared to the year prior. Maybe the right idea is to change it over a period of years. Right. So make a 5% change every year or 10% change in your contribution every year for 10 years to kind of get it up to 100% Roth. There's really no correct answer here. If you're thinking about it from the perspective of, well, I might want to be financially independent early and I'm concerned about having a bunch of IRA money that I can't touch. The IRS doesn't care when you retire. They just care that you retire. So you can always access your retirement money if you're retired. What they prevent you from doing or strongly encourage you to not do by penalizing you is touching your retirement money before you retire. So that's not really a concern that I see it anyway, in terms of early retirement considerations. The other thing to look at also is, you know, you're making 350 grand right now. Is that number likely to stay the same? You know, as time goes on, it'll probably increase, depending on your specialty and depending on, you know, I mean, just even cost of living changes, but generally speaking, it's going to increase. So, you know, it sounds really grotesque to say, but you might actually be in the lowest tax bracket you're going to ever be in right now. And the right answer is to go after tax today. So there is no correct answer to this. It's just knowing the domino that's going to fall in the tax bucket so that you're prepared to withstand that. The worst that happens is you change it all. You go, oh, we're going to go all 401k right now. We're all going to go Roth, or we're going to put all that 140k or as much as we can into our brokerage account instead. And you're ill prepared for the tax bill that's going to happen because of that doesn't make it right or wrong because you're trying to solve for a problem that we have no idea or solve for a solution that has an unknowable future, which is what are the tax rates going to be in the year of your distribution in, you know, 20, 40, whatever, when you decide to take money out? And by the way, how much are you going to take out and how are you going to start? You know, we just can't answer that. So I think that what you're doing right now is fine. I might. If I was going to make a change, I would make the change to be more Roth 401k focused, because you have the excess cash flow, clearly, by saving 150 grand a year, and you're well behind in terms of balance, if you're thinking about it, if balance was a requirement, which it's certainly not, but if it were, if you were thinking, I want this to be 50, 50, you're never going to catch it because your company's putting 40 grand in and you're behind by 400,000 right now. So it's going to be really hard to catch up. Not that you should. I'm just saying maybe the first change is allocating more Money to Roth 401 contributions in the future. Just kind of drip that in over the next little bit.

[Joe Saul-Sehy]

How much does he do for that? Just as much as he can stomach, you know, if he's looking at his tax bill, like, how much additional tax bill he can stomach, the reality is.

[OG]

Is that day one is going to be the most painful because you're not used to it. That's why, you know, it makes a lot of sense when you're young to set up all those savings and automate all that stuff. You know, you. You graduate college and you get your first job, and it's $60,000 a year. You better be saving 25%, you know, because that's. If you don't save it now, it's going to take you until you make 600,000 to be able to save 25% again. You know what I mean? Like, you'll just use it up, and you better be Roth, because you don't know any better. But now that he knows, he goes, well, my tax bill last year was 100 grand. If I do this, it's going to be 110. My God, that's ridiculous. It's only ridiculous because you know about the 100. If you didn't know about the hundred, then 110 is 110. It only matters in the comparison. So, honestly, I would probably change it over a period of years between the doctor and his spouse. They've got $47,000 that's going in 401ks right now. Maybe this year you do 20% of that, and then next year you do another 20, and, you know, it takes you five years to kind of move into it. You could also get really strategic and say, well, my pay rate went this year from, you know, I went from 380 to 397 in payroll, so I got 17,000 to play with. You know, like, you could. You could really just do the extra. Yeah, just whatever extra you make net after tax, you allocate to the tax bill to kind of count for it. But it sounds like there's so much extra fluff in the budget that it's whatever you want to do.

[Joe Saul-Sehy]

It's going to pay off later, though, Dr. Hogan. It will pay off later to get that flexibility that you're looking for. And I also second that emotion. OG Starting earlier. Better than better. Starting late. And clearly to your point, too, he's going to be fine if he just keeps doing what he's doing, right? Yeah.

[OG]

I've never talked to anybody that's like, oh, God, my life sucks, man. I got 7 million in my IRA. Sucks, bro.

[Joe Saul-Sehy]

Couldn't do it.

[OG]

It's just part of the deal.

[Joe Saul-Sehy]

It's a nice start.

[OG]

Good job.

[Joe Saul-Sehy]

Thanks for the question. Dr. Hogan. If you've got a question for us. Stacking benjamin.com Voicemail is the way to get there. And you know what? We reward people to call in with the shirt that Dr. Hogan talked about. And you know what's cool? We're going to send you a code and you get to decide whether it's aspirational. But I think he should go for the aspirational. I think medium. Say yes.

[OG]

Medium.

[Joe Saul-Sehy]

Yep. Because he'll also look really ripped in that thing. Right. While he's on his journey. I mean, I guess it depends on which way he's going.

[OG]

Yes.

[Joe Saul-Sehy]

If he's.

[OG]

Depends on the aspirations.

[Joe Saul-Sehy]

If he's building it really, really, really big because he doesn't have the muscles. I don't know.

[OG]

Going beachbody or are we going winter warmth.

[Joe Saul-Sehy]

Yeah.

[OG]

Which way you headed, buddy?

[Joe Saul-Sehy]

Not sure what he's aspiring to. It's all individual goals. Stacking benjamin.com voicemail gets you there. Let's journey out to our community segment of the show before we say goodbye, which is what we call the back porch. Next Thursday, guys, I will be in Seattle. Actually be in Bellevue right next to Seattle.

[Doug]

Isn't that an insane asylum, Joe?

[Joe Saul-Sehy]

I will be Doug's. Like, it's about time that you figured out. Yeah. Stacky benjamin.com meetup Thursday night, 6:30. I will be in Bellevue, which is the same place where I will be speaking on Saturday. Well, I'm going to be in a different place because we're going to be at a place where there's beer tapster. Bellevue. This is one of those cool places, guys where they have serve yourself beers that could be dangerous. Like you walk up to the tap and you've got a little QR code.

[Doug]

I just learned about these. There's one of those in Michigan here that I just learned about. And yeah, you get. You have to scan your QR code every time.

[Joe Saul-Sehy]

Scan your code? Yeah.

[Doug]

Like is there somebody watching you or could you just sort of like fake scan it and then pour?

[Joe Saul-Sehy]

I don't know. But if there's a system, Doug will find a way. It'll free beer. Just what we want to emphasize. Cheat in the system. I can't wait. I've never been to a place that has pour yourself beer so people can make some fun videos of Joe. I'm sure dancing on the tables, whatever it might be. Stacking benjamin.com.

[Doug]

You don't want to see Joe dance. We're going to really don't want that.

[Joe Saul-Sehy]

Every time we play that pre video on YouTube. Oh, my God. Joe Danson. Not great. You guys are going to be at Tahoe? We don't have the place yet, but you will be there near the end of February, I think we do.

[Doug]

We're going to be there on the 19th, right? Wednesday. And right now it looks like we're going to be at MCP's Taphouse six to eight. Six to eight.

[Joe Saul-Sehy]

BYOB's Tap House, six to eight. Will they let you be OB. He's walking with. With their own alcohol.

[Doug]

It's Nevada. I mean, everything's legal in Nevada. Yeah, bring your own.

[Joe Saul-Sehy]

Just bring it on in.

[OG]

Wait, we're going to Nevada? We have a new place to meet. New place.

[Joe Saul-Sehy]

I'll talk to you after stackinbenchments.com meetup. It's going to be fun. All right, that's going to do it for today. Doug, you've got it from here, man. What should we have learned on today's show?

[Doug]

Oh, actually, it is on the corner. MCP's Taphouse is on the state line. It's probably 40ft from Nevada. We're going to be in California. Dang it. I don't let you do anything in California. But here's what else we should have learned today. Today. First, take some advice from our headline. Using a Target Date Fund, set up your own Target Date Fund. You'll avoid fees, better understand what you're doing, and avoid losing out on returns because someone arbitrarily decided to drop the stocks in your portfolio. Second, Bills. Yeah, I got bills. Just not the Buffalo Bills, but hey, I mean, Josh Allen, you want help with how to spend that paycheck? We're here for you, buddy. But the big lesson. Don't ask Joe's mom about a round of hot chocolate, because she'll start singing that song from Polar Express. You know the one where it's like, never, ever let it cool. Keep it cooking in the pot. Soon you got hot chocolate. God, that just gets in your head.

[Joe Saul-Sehy]

Hot, hot. Oh, God.

[Doug]

Now it's in my head. Son of a. This show is the property of SB Podcasts, LLC, Copyright 2025, and is created by Joe Saul Sehi. Joe gets help from a few of our neighborhood friends. You'll find out about our awesome [e-mail] along with the show notes and how you can find us on YouTube and all the usual social media spots. Come say hello.

[Joe Saul-Sehy]

Oh, yeah.

[Doug]

And before I go, not only should you not take advice from these nerds, don't take advice from people you don't know? This show is for entertainment. Entertainment purposes only. Before making any financial decisions, speak with a real financial advisor. I'm Joe's mom's neighbor, Doug. And we'll see you next time back here at the Stacking Benjamin Show.

[Joe Saul-Sehy]

While I was online, I saw this. This fantastic tale that I'd like to play for you.

[Peter Frampton]

Okay, quick walk of shame. Story time. So I used to live in the D.C. area, and at the time, I was dating this man who lived in a very nice condo building in Logan Circle. One night, after many beveraginos, I find myself waking up in his apartment. 6am still drunk. I carefully peel back on my leather pants and I tiptoe out of there to get to my car that is parked in the residence garage below the condo. As I'm getting into the elevator, his neighbor catches the doors just in time to join me for the ride. His neighbor, Supreme Court Justice Sotomayor. I look at her and I fire breathe Jack Daniels onto her as I say good morning. She looks me up and down, and because I can't just stay quiet. No, I have to say something. I look at her and I say, judging started a little early this morning, huh? She says nothing. The door is open to find two U.S. marshals there to greet her, to assist her, escort her to her armored vehicle, to take her to her job at the Supreme Court. So, Sonia, if you're seeing this girl, remember me in the leather pants. Same TikTok for me. For. For us. I'm so sorry I said that. I'm so sorry.

[Doug]

I think what you miss in the audio version of that is she sort of demonstrates the way that Sotomayor scanned her up and down with disgusting.

[Joe Saul-Sehy]

I don't know, man. You couldn't hear that. I heard that pretty loud and clear.

[Doug]

Judging starting a little early, huh?

[Joe Saul-Sehy]

I love those moments, though, when you say something and you're like, oh, put it back in. Put it back in, please. I did that a long time ago at a Detroit Pistons basketball game.

[Doug]

Oh, I had one there, too, that I regret. What was yours? I'm not telling mine, but what was yours?

[Joe Saul-Sehy]

I was. I was. This is back when Grant Hill played for the Pistons and I had had a ton to drink, and he had a new pair of shoes out called the Fila Hills. And they were this. Had this weird. They were like white shoes with this blue stripe that went right up the middle. And after halftime, my buddy and I, we were sitting courtside, by the way, we were in those folding chairs on the scoreboard. Yes, And I was sitting in the second row, and I'm sure we were just getting louder, more obnoxious. But Grant Hill would inbounds right in front of us when they do it from about the free throw line is. That was where we were at. And I remember he comes over and he stands right in front of us. And after he inbounds, I'm like, oh, God, those shoes are so ugly. Okay, I decided. I decided I hate the shoes. And then I was trying to crack a joke, and I said, but I wonder if he gets paid. You think he gets paid to wear those? And the dude sitting right in front of me turns around. His face is beet red. He shoves a card in my face and goes, hell yeah, he does a lot. And call me sometime and I'll tell you, it's the fila rep right in front of me.

[Doug]

You were just doing. You were giving him free market research is all you were doing, Joe. That doesn't sound that bad to me.

[Joe Saul-Sehy]

But you know what's funny was that then he turned around later, he goes, very seriously, I don't give a what old men like you think. He goes, you're not my target market. He was. He was not happy.

[Doug]

Wow. That took him a long time to think of that comeback, though. I don't. Yeah, he doesn't get any points for that.

[Joe Saul-Sehy]

No, I just thought he was a jerk Fila guy. You are a jerk.

[Doug]

Bet he's listening.

[Joe Saul-Sehy]

The Supreme Court justice. Maybe do it a little judging.

[Doug]

You know what? That's what we need. If you're a famous person listening to us, let us know. I mean, be great if you did it in the basement. But just, just so we know we've got some firepower listening to us.

[Joe Saul-Sehy]

Have you heard that story? Peter Frampton told this story on.

[OG]

No, I haven't heard it.

[Doug]

He listens to us.

[Joe Saul-Sehy]

Peter Frampton told the story on, and I believe it was Howard Stern about how he was in the elevator on his way to go get ready for his gig. And most people, even from the 70s, who would even know who Peter Frampton is, don't realize that he is now bald versus that long mana hair that he had. And so he was just trying to make conversation. People in the elevator and they're like, oh, we're going to see this one washed up guy.

[Doug]

Like, they were totally.

[Joe Saul-Sehy]

Ripping him. He's like, imagine what happened when I come out and I'm the washed up guy that they were going to see. They're like, yeah, we got free tickets. Somebody offered us. We really don't want to go, but didn't have anything else going on. So brutal. Not good.

[OG]

Nice.

[Joe Saul-Sehy]

I'd love to hear your foot in the mouth stories. Like, what's something that you said? Stackers. Call us. Either leave it on voicemail for the show or share it in the basement. But we prefer you to leave it on a voicemail so we can hear your Supreme Court justice story.

[Doug]

Yeah, we need a lot more audience participation that we can put on an episode.

[Joe Saul-Sehy]

Bring it. Yeah, bring it, Stackers.