transcript

Speaker 1:
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Speaker 5:
[01:00] Describe your perfect date.

Speaker 6:
[01:04] I'd have to say April 25th, because it's not too hot, not too cold. All you need is a light jacket.

Speaker 7:
[01:19] Live from the basement of the YouTube Headquarters, it's The Stacking Benjamins Show. I'm Joe's mom's neighbor, Doug, and what if I pointed out there might be money leaks all around you? Today, we're diving into your financial statements to hopefully help you save thousands. What do you need to know most that's written on your credit card statements, brokerage fine print or insurance sheets? We'll help you pull it all together. And while you're counting your savings from the first half of today's show, we'll take a breather for another installment of our year-long trivia competition. Will OG make a break for the best year of all time? Can Paula or Jesse catch him? We're about to find out. And now here comes a guy who found out the hard way what the letters APR meant. It's Joe Saul-Sehy. If you don't joke, the pros call that APR.

Speaker 8:
[02:27] They do call it APR, Doug. But that's why maybe we're not pros yet. Hey everybody, happy Friday. Welcome back to The Stacking Benjamin Show. Super happy you're here. And yes, I had to learn to read the fine print myself, which is why this is such an important episode for a lot of people. We're going to talk about those statements that are out there. And exactly what do we miss? What do our roundtable participants look at first? What do they not really care about that the statement kind of has on it? So when you're looking online at your app or you're stuck in Paperville, no matter what, we've got you covered. But the guy who's got this episode covered every Friday is Mr. OG. How are you, man?

Speaker 9:
[03:10] I'm good. I'm good. I do not read the fine print, but I'm looking forward to doing it today.

Speaker 8:
[03:14] I'm super happy that we're going to talk about this because how many times in your life and in my life, I certainly had this a bunch where I go, oh man, I missed that. Like, oh, I should have read it. I should have read it.

Speaker 9:
[03:26] I just had a email that I was reviewing that said, hey, don't forget to send this package certified mail by the 15th. I'm going, oh yeah, there's plenty of, oh crap.

Speaker 8:
[03:38] The 15th of what? That was a couple of days ago or a week and a half ago.

Speaker 9:
[03:42] Well, thankfully, we're recording two days early. So I've got roughly 36 hours to get my, you know what, to you know where. To send a certified letter somewhere.

Speaker 8:
[03:50] I got mine done this morning, by the way, right after we recorded some shows. A woman who always says her tax is done on time though is here, Paula Pant.

Speaker 2:
[03:59] I would dispute that characterization, but I am here.

Speaker 8:
[04:02] She's like the Maury Povich. The facts would say that is not true.

Speaker 2:
[04:07] Yeah, the facts would say otherwise, but if you insist on being detached from reality, then you could say that.

Speaker 8:
[04:14] Have you ever been burned by the fine print in a financial statement, Paula?

Speaker 2:
[04:17] I've definitely been burned by lots of expiration dates that I've failed to heed. Hmm. Have I been burned specifically by the fine print? Not that I can think of. Knock on wood, not yet.

Speaker 8:
[04:33] I got a credit card that expired just about eight months ago, and I missed it. I also did not, for whatever reason, address whatever. I didn't get the new one. And next thing you know, I'm like last second, looking through the fine print to see exactly what my recurring subscriptions are so they wouldn't fail. Everything that was tied to that card.

Speaker 2:
[04:56] Wow. I thought credit cards, normally they just auto re-up you.

Speaker 9:
[05:00] When you've got Joe's credit, they make you prepay it. And when you run out of money, they make you send in another $500.

Speaker 8:
[05:08] For those of us struggling to get to, oh, you know what the problem was? It wasn't that it expired. It was that I thought it was stolen, sorry. Yes, so I did get it. I'm like, yeah, that makes sense. Why was that? It was that I thought it was stolen. Yes.

Speaker 2:
[05:21] Right, yeah, because I've definitely had credit cards where I've gotten to the expiration date and they've just automatically sent me a new one with a new expiration date.

Speaker 8:
[05:29] And a guy that we've stolen from is brand new family member for this episode, the new dad, Jesse Cramer's here. Congratulations, man.

Speaker 4:
[05:39] Thank you very much. Good to see everybody. Good to see the audience out there in the chat. What's up, guys? It's nice to be back.

Speaker 8:
[05:47] We perform this live on YouTube if you want to hang out with us. We love pretending that it's Friday on Mondays. We record this. So Monday afternoons come join us. But Jesse, you've been off for two weeks from this show, but you don't look rested. What's up? What's going on?

Speaker 4:
[06:01] A little tired, a little tired. Last night was a little rough, but I kind of feel the energy of the room. You know, I'm ready to be here. I might yawn once or twice. We'll have to edit that out in post, but it'll all turn out.

Speaker 8:
[06:12] You know, it's funny, I finally went to... I've been living in OG. How long have I been living in Texas for a long time? For 15 years?

Speaker 9:
[06:19] Six, seven months, at least.

Speaker 8:
[06:20] At least. And I finally made it to a rodeo a couple of years ago. And when they're doing the rope tricks and stuff and very quick, like, Jesse knows a bunch of diaper tricks. Like, can you diaper a baby now in like 20 seconds flat?

Speaker 4:
[06:34] I really can. And the cool thing, well, cool, right, in air quotes. So our elder child is in size six. If you're familiar with diaper sizes starts with N for newborn, then goes up to maybe six or seven. But the baby is in Ns. So I've got this diversification of my size. And so the Ns require some nimble fingers. The sixes are more about like big, broad strokes. But really, I could I could diaper just about anything. OG, you know what I'm talking about, right?

Speaker 9:
[07:01] I mean, I have big recollections of it from 20 years ago. But allegedly, allegedly, I diapered kids, as you said.

Speaker 2:
[07:09] So going back to the you finally made it to a rodeo. So when people say this ain't my first rodeo, you could actually you could actually say, well, this is my first rodeo.

Speaker 8:
[07:20] I should have said that that day to the people next to me.

Speaker 2:
[07:23] Actually, this is my first rodeo. Yes.

Speaker 8:
[07:25] Yeah, it was super fun. Jesse, now two 529 accounts. Do you pay attention to the fine print?

Speaker 4:
[07:32] It's a good question, maybe not as much as I should. When you were asking Paula earlier if she'd ever gotten burned, it made me think of that question. I'm not sure if I have, I can't remember. But there are definitely some times where I probably should have paid much more attention than I did. We can get into some fun examples later, but I have a couple that come to mind.

Speaker 8:
[07:48] Excellent. Well, if you're new here, what I love about our Friday roundtables is the honesty of our contributors, people that are really financial enthusiasts, but by the same token, struggle with the same stuff that you guys, you stackers all struggle with. So we're going to talk about what's important on the statement. What's the first thing you look at? What do you think people shouldn't look at so much? Where are the important points? Where are the inflection points? We're going to dive into all that. But first, we have a couple of sponsors to help us keep on keeping on. We just have a couple of them now and then halfway through Drugs Trivia and that is it. Those are the only sponsor spots we have. So we're going to have two of them right now. Then we'll be back with Paula, Jesse, and OG chat and financial statements. What I love about this topic, guys, is we're not sharing hacks today, because I think most money hacks are kind of garbage, right? But your money hacks and my eyes immediately start to roll. We're talking about these small details that quietly cost people real money over time that we might miss. I want to start with different things that we have. I want to go through credit cards, 401k, insurance and brokerage accounts. Let's say, Paula Pant, that those four things show up on the same day at your house. For whatever reason, you've gone back to paper or there's a brand new statement, and you've got to look at one first. Credit card, 401k, insurance or brokerage. Which one of those are you checking first?

Speaker 2:
[09:24] I'm checking the credit card first because that's the immediate, got to pay this off in full right away. So let's find out what that amount is so that I know how much cash I've got left over.

Speaker 8:
[09:35] OG, you agree with that?

Speaker 9:
[09:37] Yeah, probably. I think that would have my attention first, yep.

Speaker 8:
[09:41] Let's go. Jesse, you're nodding your head, so I'm not going to ask you the same question.

Speaker 4:
[09:44] Well, I think this is a clear delineation between credit card and insurance being kind of above the line for me, and then the 401k and brokerage being below the line.

Speaker 8:
[09:53] Yeah, why is that? What does that mean?

Speaker 4:
[09:54] Well, there's very unlikely to be any sort of urgent fire in the 401k or the brokerage that I can't put out tomorrow or next week, whereas the credit card there could be. And then on the insurance front, it's like when you hear a horror story of someone who missed a premium and then their insurance lapses in some way, or there's some sort of like, I hate to say it this way, but let me put it this way, some insurance companies kind of have a pretty, what's the right word for the type of relationship they have with their customers?

Speaker 9:
[10:21] Adversarial.

Speaker 4:
[10:22] Adversarial? Yeah, exactly. So there's some insurance policies out there where it's like, if you don't open that envelope and understand the fine print, you might screw yourself over.

Speaker 8:
[10:30] That's funny because I said earlier that my credit card was stolen and one of those things that happened, Jesse, was my car insurance premium. Did not get paid for four months. I was insurance free for four months, saved a bunch of money. That was great.

Speaker 4:
[10:44] We can save you a bunch of money on your home and auto insurance.

Speaker 8:
[10:47] I'm just lapsing it. Yeah, perfect timing. Is there one, Paula, that you check last of those four?

Speaker 2:
[10:54] I would agree with Jesse. Between the two, I'd say probably taxable brokerage I'm checking last because I'm not even going to rebalance that by selling out of assets that I hold because of the tax consequences. When I rebalance in a taxable brokerage, I just buy more. I do it by buying more of wherever I'm sure. Unless I'm in position where I'm ready to buy more, there's no real reason to check it at that moment.

Speaker 8:
[11:23] Let's start. You all said credit card is first, so let's start there everybody. Give our stackers some usable stuff. You take a look at the credit card website or a statement that comes assuming you're still getting paper. OG, what's the first thing you look at?

Speaker 9:
[11:36] Well, it's interesting that you put this one on because as we were talking, I was maybe doing a little multitasking here, and I got an email from Chase and it said, your credit card statement is available. I clicked it and I went, well, that doesn't seem right. That seems like order of magnitude too high. The first thing that I did was went to statements and literally said, okay, well, what's on here that I didn't expect? What's snuck on there or what's an error that I wasn't expecting? I very quickly found the culprit and went, oh, yeah, that's right. I forgot about that. But I had an unusually high automobile maintenance bill. I mean, it was only two weeks ago, but I just forgot how much that was. And so the number looked high and the first thing I did was sort by biggest to lowest to find out where the, where I don't know, you said leaking is from likely culprit. Yeah. For me, leaking is always with a comma. So I'm going to find that in the, find that ordered highest to lowest.

Speaker 8:
[12:44] It is interesting, Jesse, because whenever Cheryl and I have gotten in trouble with our spending, it's because we missed our weekly meeting. And then all of a sudden I look at the credit card and I'm like, whoa, boy, what the hell is going on? But it's as much about having this conversation when you look through the register as anything, I think. Yeah.

Speaker 4:
[13:01] I just, the more, the more stories or the more conversations and stories I hear about, you know, family finances is, it's very easy to kind of fall off that horse. Speaking of rodeos, it's very easy to like fall off the horse as a family when you're trying to be on the same page as far as what you spend and just, or whether it's who's putting what in which investment account. A lot of families still keep some sort of separate finances. They'll have like partially joint and partially separate. So it's like, well, who's paying the mortgage? Oh, that's coming out of the joint account. Who's paying the life insurance? Oh, we each pay our own life insurance premium. It's like when you hear some of the ways that people approach their finances, it makes you realize that there's that human error opens up a lot of opportunity for more misses, like more than just missing the fine print, right? It's just that the human error factor is real.

Speaker 8:
[13:45] Paula, what's first thing you look at in the credit card statement?

Speaker 2:
[13:48] I generally will scan through all of the vendors to just make sure I recognize everything. Typically, in the process of doing that, there will be a few that trip me up, not because they're fraudulent, but because the name of the vendor that appears on the statement doesn't match the name of the vendor in real life. They'll have some DBA or something. It drives me crazy. Generally, there will be maybe two or three where I'm like, hold on, who is that? Then I have to Google it and then I figure it out. But that's the first thing I'm doing. I'm kind of glancing through it and just making broadly, making sure that I recognize everything.

Speaker 8:
[14:25] Eddie, in the comments, Jesse was talking about auto bill payments. I don't know, Eddie, if you're mentioning this because it's a good thing or a bad thing, but it seems to me, Jesse, it can be both, right? This idea that, hey, at least my minimums covered would be great, but there could be some auto pay complacency going on.

Speaker 4:
[14:41] I thought he was talking about automobiles, but I think you're right. He's talking about automatic.

Speaker 8:
[14:44] He's talking about automatic. I couldn't figure out why you were laughing.

Speaker 9:
[14:48] Well, it could be a couple of things. It could be auto billing payments, making sure that you get min pay so you don't get penalties or bad credit. I thought about it like I'm auto paying my bills, like my water bill, my electric bill. That's what I thought about.

Speaker 4:
[15:04] That's what I thought he meant, too, was like, yeah, just the automatic deduction. The problem with the automatic bill pay, which I do, like we do everything auto that we can, right? We automate it. We put it out of mind, is that you do possibly end up in that situation where you're like, oh, right, I forgot about that gym membership, and it's been $79 a month for the last four years, and we haven't been. Because again, if you're not reviewing it and it's just automatically paid, that is one of the potential consequences. So again, that's why reviewing is a good thing. But the benefits of auto pay, in my opinion, far outweigh the detriments. I think the other one that I've heard before, too, is when you auto pay, it becomes harder sometimes to protest some false bill or like retract some. I've heard that before. So where it's like a good example, I'm trying to think about like a realistic example, might be like the utility company or something. Like you get some weird bill that's got an extra comma in it because of their accounting error. And it's like, it wasn't $100. They charge you a thousand instead of a hundred. You auto pay the thousand. And now it's like, well, now the onus is on you to get it corrected, right? Whereas if you hadn't had on auto pay, you're like, I'm not paying this, right? Send me a correct bill first and then I'll pay. Whereas once you've auto paid and your money's out the door.

Speaker 8:
[16:19] They've already got your money.

Speaker 4:
[16:20] They've already got your money. And now it's really on you to try to chase down and get it corrected. So I've heard that before, but it still doesn't convince me to not auto pay. Speaking of double negatives there, Paula, like we were talking about before, I auto pay as much as I can.

Speaker 2:
[16:33] Yeah. Well, if you think about it, or even if that is the case, and let's say that happens three or four times across your life. If you think of that as like, if that is the fee associated with auto paying, would you pay that fee?

Speaker 4:
[16:47] Right.

Speaker 8:
[16:47] TJ was talking about fees, making sure they know the due date, not paying penalty fees. There's a big thing. What day is this bill due to take care of it? I don't know about you guys though, that like, I don't like carrying a credit card balance, so I pay it like as soon as I see it, I pay it. Jesse, you're nodding.

Speaker 4:
[17:03] I think ours is set up on an auto, on an auto pay.

Speaker 8:
[17:05] Just to go.

Speaker 4:
[17:06] Just to go, right. It's like within a week, it's a full amount or for a minimum? For the full amount.

Speaker 8:
[17:11] For the full amount.

Speaker 4:
[17:11] For the full amount, yeah. The bill comes in a week later, it's paid as opposed to whatever, the full month that you have to pay it.

Speaker 8:
[17:17] Mine is set on minimum in case I forget, but I don't forget just because I want to review all of those transactions. And to your point, Paula, oh my God, when we went to Greece last year, matching up the names of the places that you went with the bills, I had to just trust that it was right because I don't know any of these words that were on my credit card.

Speaker 2:
[17:37] So, Kavya, if I travel to a foreign country, anything associated with that, I'm just like, man, sure, looks good, ish, ish.

Speaker 8:
[17:48] I don't know if you write down your transactions as you go or how you would keep track of that better because it's a minefield. Let's move on from credit cards. Even though, really, on some of our shows, we talked about credit cards, we could talk about lifestyle creep and looking through it for lifestyle creep and do I value all the different things that I have the subscriptions for, am I actually using it? But let's go to one. I don't remember which one's above the line and which one's below the line. Jesse, 401k is below the line, right?

Speaker 4:
[18:19] Yeah. I think I said insurance was above the line. That would be my next one to look at after the credit card would be any insurance statement.

Speaker 8:
[18:25] We're going to leave that one for the first one after the trivia question at halftime. So let's go into the 401k then. You take a look, OG, at the 401k statement. What's the first thing you're diving into?

Speaker 9:
[18:38] Rate of return, obviously.

Speaker 8:
[18:41] Today's return.

Speaker 9:
[18:43] Yes. What happened in the last seven minutes? No, I mean, honestly, if that's again, just so happened that I pulled that up today, because it's a thing for the company plan. And yeah, I mean, that's the first thing my eye got attracted to was, what's the one-year rate of return number? But the thing that I looked at today, and this is where I would spend the time was, am I on pace with the savings that get me to the finish line this year? So I quickly glance at the contribution numbers to make sure that those kind of check with where I think we should be for the year relative to the savings amount that I was trying to get to. I'm lucky enough to be able to contribute the maximum to my 401k. So I know after a quarter, probably need to be somewhere in that $8,000 or $9,000 range for the year in terms of contributions. So yeah, that's the first thing that I look at is just what the contribution number is and is that in line with what I expect. I think most places with 401k stuff is automated these days in terms of like payroll to 401k. But there have been known to be issues where you're withholding money out of your paycheck and that corresponding deposit is not happening. The IRS does not look very kindly on companies that do that. So if you find that, your money needs to go in in a reasonable time frame is the rule. Next quarter is not reasonable. Next week, maybe. Today, better, right? So you need to be matching up your contributions or your company needs to be making your contributions roughly about the same time that you're having a withhold from your pay stuff.

Speaker 8:
[20:20] Oh, jeez. Looking at contributions and is he on pace with the goal? What's something, Paula, that people don't look at enough that maybe they should pay more attention to?

Speaker 2:
[20:30] See, I would actually argue that focusing on rate of return is not the right focus. I would say focusing on contributions is definitely the right focus because contributions are within your control. But I would actually...

Speaker 8:
[20:45] I like looking at rate of return, but we'll talk about that in a minute.

Speaker 9:
[20:47] Yeah, I mean, you just see it. Like, you asked what I noticed. And I opened the page and that's the first thing I saw. Maybe it's because that's the first thing they put there, right? Like, you know, that's the top left header image, you know, in terms of what's on the website. But yeah, I mean, I agree it's not the driver of anything. It's still fun to see.

Speaker 2:
[21:05] Yeah, certainly, they definitely make that like big and unmissable. When I look at my 401k, I basically am looking at two things. I'm looking at what's the total balance, because I'm contextualizing that with my, like, in my overall net worth. So like, what's the total balance in the account? And how's my asset allocation doing? Is it like super out of whack or not? As long as my asset allocation is good, that's it. I don't really care. Like, I'm not really tracking, even though they do make it unmissable. I'm trying not to care what the returns are, because what matters is the asset allocation correct.

Speaker 8:
[21:43] That's so funny, because I actually like looking at what the returns are, but just for a different reason. Which is, because Eddie, hanging out with us, said, look at it, how much with all the, you know, negative stuff that's happened, how far down am I? But what I want to know is, if something is glaring at me, is it my allocation that's the problem, or is it just the overall market? And I just want to ask that question, is it my allocation that's messed up, or is it the market? And, you know, when you're using indexes, it makes it much easier to answer that question. But if for some reason your 401k only has active managers, then you certainly might have a problem with the manager sliding away from what they should be doing. Jesse, what's the thing people should pay more attention to?

Speaker 4:
[22:29] Well, my answer, if it's okay, Joe, I'm actually going to go a little less about the statement. Can I focus on some of the things you should look at when you're initially making some decisions in your 401k?

Speaker 8:
[22:39] Fine, just make it your own topic, whatever topic you want, Jesse.

Speaker 4:
[22:43] Well, okay, my truthful answer about what do I look at in the statement, it's nothing original compared to what OG and Paula have already said. I'm basically just looking at what's the current balance in the account, is my asset allocation more or less on target? I'm probably only going to rebalance once a year anyway. At this point, I just take it for granted that all my deductions from my paycheck are actually making it into the account. There's not that much to look at other than those things. But I do think what's really consequential is when you're originally making that asset allocation decision to say, oh yeah, what are the expense ratios of these funds in this 401K? Is it measured in single-digit basis points because of some giant 401K plan at a well-known custodian? Or are you paying 80 basis points for a target date fund? At a target date fund that more and more evidence is coming out, not all target date funds are created equal, that's for sure. I think those decisions when you're looking at 401K paperwork are really consequential. When you're looking at the fine print of a 401K, those are really consequential decisions.

Speaker 8:
[23:44] It is interesting because we can save it for a different episode, but I wouldn't use a target date fund at all. I think you're smart enough to do it without it. But if you do have a target date fund, there is a big difference between ones that are really heavy fees, really low performance, and ones that are really, really good. Like there is a wide disparity between good target date funds and not so good target date funds. All right, I can't wait to see what Jesse's going to tell us about insurance because he was really excited about that one. We're also going to talk about brokerage statements. What are we going to look at on those places? But at the halfway point of every Friday show, we have this year-long trivia competition between Paula, Jesse and OG. Paula, we had some news while you were gone last week. Our friend Jackie Cummings-Koski set in for you, did a nice job for Team Paula. But the biggest thing she did was she won the trivia. Yes. Paula, apparently the key to you winning is don't show up.

Speaker 2:
[24:42] Yes. The key to winning is recruit someone else.

Speaker 8:
[24:46] That might help your chances. So the score is OG has seven. Right now, OG is looking at it. Doug and I just decided we got to look this up. What is the record for most points in a year? What is the record? Because OG has got to be on pace for that. Can Paula or Jesse slow him down, which is what we're looking for? We have a concept called a margin call. Margin calls can only happen when we have all three contributors here, so we might have one now. If somebody says the word margin call, they're risking one of their points against the person they call margin call against. So if OG gets margin called, for example, OG then has to win the trivia of the day, and then he gets his point. If he does get the point, let's say it was Paula that margin called OG, Paula will lose a point. But if OG gets margin called and he is wrong, Paula would win a point and OG actually loses a point. So instead of it being no harm, no foul, OG would actually lose a point or Paula or Jesse, whoever it is that does that. We need a trivia question. Doug's been upstairs, but Doug, what is today's trivia question?

Speaker 7:
[26:07] Hey there, stackers. I'm Joe's mom's neighbor, Doug. Today, Joe's mom and I were reminiscing about all the things that used to be innovative and progressive, like dial-up modems, which made that exciting sound when she'd get on the computer. There were cassette tapes. I mean, those were incredible. Far easier to carry a bunch down to poker night than albums, and two-hour, three-martini lunches. Those were like liquid courage for an afternoon of prank phone calls to old boyfriends. Not particularly innovative. She just loved pranks. Ah, the old days. So imagine my surprise when I realized that the dodo bird of brands Woolworths opened what at that time was the tallest building in America back on today's date in 1913. It was built just like me, a sturdy 30-story base topped by a 30-story tower. The building was so tall. How tall was it that even today, it has its own zip code of 10279. Unfortunately, while there are still a few Woolworth 5 and Time lunch counters around the USA, the stores are long gone. The company has now pivoted to a new name, one that you all probably know. I'll share that later. But first, this question, what year did the last Woolworth store close in the USA? I'll be back with the answer after I figure out why the dollar store isn't called the $5 store because that would be truth in advertising.

Speaker 8:
[27:44] What would 100% be truth in advertising? What should we call Costco now? The $400 store? I don't know. We start off with OG. Woolworths in America have all closed. There's a few lunch counters, but none of the stores. When did the last one go bye bye, OG? You are on mute, my friend. Hold on, hold on.

Speaker 9:
[28:06] I know I got it. I saw the mute button. Chill. I was saying I happened to know this because the last one actually closed in my town. So Doug did me a solid. I mean, I remember it. So I just have to think about it. I think I was in like fourth grade, maybe. So I'm pretty sure it was 1988.

Speaker 8:
[28:26] 1988. So Jesse, he's done this before, where he plants an anchor that may or may not be right.

Speaker 9:
[28:34] I'm telling you, I lived in the town where this one closed.

Speaker 4:
[28:37] Yeah, I've never seen a Woolworths in my life, except there's a scene in Oh Brother, Where Art Thou? Where they get kicked out of the store. And the clerk has a very distinct accent, and he throws them out of the store. And he says, you know, I think he just says like, stay out of Woolworths. It's got a really-

Speaker 8:
[28:58] Perfect. And that's the way you pronounce it forever now, isn't it?

Speaker 4:
[29:00] It is. It's how I hear it in my head. Yeah. You know, for the sake of gamesmanship and fun, I don't want to just like surround OG's guess. I'll go 1977.

Speaker 8:
[29:17] 1977. Well, Paula, we got 88 and 77. What are you thinking?

Speaker 2:
[29:23] Oh, OG sounded fairly confident, but given his level of confidence, I think that he probably nailed the rough era, but maybe not specifically the year. So I'm going to take the downside on that and say 87.

Speaker 8:
[29:44] 1987. Trying to make sure if it was less recent that she's got it. So Paula, was that your gut instinct?

Speaker 9:
[29:54] I can't margin call. It's too late.

Speaker 7:
[29:56] It is too late.

Speaker 8:
[29:57] I was like, wait a minute.

Speaker 4:
[29:58] Hold on.

Speaker 7:
[30:01] Not that I've heard all the answers.

Speaker 9:
[30:02] You said anytime, right?

Speaker 8:
[30:04] Yeah.

Speaker 9:
[30:05] It's anytime during the question.

Speaker 8:
[30:06] We got 88, 77, 87. Who's right? We'll be right back. All right, OG, you kicked it off with 1988. Paula took your downside, but heck, if it's 1995, you got it. What do you think?

Speaker 9:
[30:20] It was 1988, I'm telling you. I was in fourth grade. It was in February. I know exactly when it was. It was still snowing. It was a big thing in town.

Speaker 8:
[30:29] Jesse, you think it was a really big thing in town for him?

Speaker 4:
[30:32] I mean, it's a convincing story. It's a convincing story. I have no idea.

Speaker 9:
[30:36] Didn't we play the game True Truce and a Lie once? Is this one of those?

Speaker 8:
[30:41] We have, and this guy can really bring it. I could see him telling his mom, no, seriously, I was at school. She would completely believe it. It was so funny, OG, on April Fool's Day. So many people, when OG was telling people, if you're not in debt, you're not even trying, and just how convincing your argument was for that. Paula, you got, well, 87 all the way five years down to where you meet Jesse in the early 80s. Feeling good?

Speaker 2:
[31:10] Yeah. I'm feeling pretty decent. I mean, if it was in that era, then I think there's a reasonable likelihood it could have been somewhere in that batch of years.

Speaker 8:
[31:20] Well, only one person has the answer. That's scary to say. Doug's got it. Doug, who's taking home this week's win?

Speaker 7:
[31:30] Hey there, stackers. I'm lunch counter lover and guy who's up for any club, long as it's a sandwich, Joe's mom's neighbor, Doug. Back in 1913 on today's date, the tallest building in the land opened in New York City. New York City. The Woolworth Building. Sadly, the stores are gone, but that's so they could focus on a hot brand they spun up in the 1970s. Foot Locker. So while Foot Locker marches on, our question was this, in an effort to better save Benjamin's, what year did the last Woolworth store close in the USA?

Speaker 8:
[32:12] And the answer, he didn't give us the answer, did he?

Speaker 5:
[32:17] For the last time, anything you put on that prompter, Burgundy will read.

Speaker 8:
[32:22] The answer is 1997. 1997, it was actually after OG anchored. Yeah, there were a few that lingered on for much longer.

Speaker 9:
[32:33] I didn't have any idea.

Speaker 8:
[32:35] But how about that? They're known as Foot Locker now. Anybody think that Woolworths would have been Foot Locker?

Speaker 9:
[32:40] No.

Speaker 8:
[32:41] No way. Yeah, whole different, whole, whole different thing. I didn't know that until Doug came rushing downstairs, like all excited with that piece of trivia. So OG takes another one home. Now he's at eight. We're going to find out what the record is and see if he's got it. Also, Paula, I forgot to bring The Secret Thing down to the basement. So we got to do that when you're back, but you're not going to be here for a couple of weeks.

Speaker 2:
[33:08] Yeah. So that means on, what is it? May 11th, we unveil The Secret Thing.

Speaker 8:
[33:13] If you're here on May 11th, you will see The Secret Thing. All right.

Speaker 2:
[33:17] That means we need to have the original cast that day. We do.

Speaker 8:
[33:20] And I don't think Jesse's here on the 11th. I think Doc G is joining us that day. So it might be a little while.

Speaker 2:
[33:25] So then we should wait until the next full cast day.

Speaker 8:
[33:28] Yeah. To unveil The Secret, Paula's Secret Thing. Now, everybody's wondering what it is. It's so exciting.

Speaker 2:
[33:33] We've really like ramped up the hype.

Speaker 8:
[33:36] Yes, which is funny because it's totally not worth it. But what is worth it is a discussion about insurances. Jesse, you were really excited about this. You open homeowners, renters, disability, car insurance, pick any of the above. What is the first thing that people don't look at enough, but they should?

Speaker 4:
[33:59] Well, if we're just talking about the statement, I just think it's, again, going back to what I said in the earlier part of the episode, it's like making sure you're paying your premiums on time and making sure you understand the side effects of saying, missing a premium statement or something like that is really important. I am not an insurance expert by any means. You guys probably know more about insurance products than I do. But still, like the more I do learn about it, the more I realize like, oh, there's all these intricacies about like the way a policy can be written, what's covered and what has to happen to file a claim, and deductibles are, and all the different numbers and how they all add up. Now, granted, some of that homework needs to be done as you're buying the policy in the first place, right? That's not necessarily something you would check on the statement as it comes into you. My point is that like the term life insurance policy that many of us are think of, it's just like, yep, 30 years, if I die, it pays me. If I don't die, it doesn't pay me. Like that's great. That's a very simple insurance policy. But a lot of insurances out there are significantly more complex than that. I think that's just good to be aware of as a consumer.

Speaker 8:
[34:58] Yeah, I think the term life insurance one, as long as that premium payments going through, set it and forget it. But OG, when we take a look at like a car insurance policy, what don't enough people pay attention to?

Speaker 9:
[35:08] I would say the number one thing that most people don't pay attention to in car insurance is underinsured insurance coverage. That's the amount of money your insurance company will pay you. If the person that you have an accident with isn't insured high enough to offset whatever sort of issue that they potentially caused. If you hit a teenager or a teen, rather a teenager hits you who has like PLMPD, like just the lowest state level amount into your brand new Tesla Model S Plaid, and you have a back injury, and their insurance is like, sorry, dude, all we got is 20 grand to cover. By the way, you can't go after this 19-year-old because they don't have any assets, so it doesn't matter. Underinsured coverage is what's going to come up and help you be made whole. I think a lot of people just go, I'm going to skip that one or I'm going to have that be a low amount, and I think that's a big miss.

Speaker 8:
[36:05] I think this is a thing, Paula, a lot of people do is they think about like, what am I paying but really don't pay attention to what do I have? What are my coverage gaps?

Speaker 2:
[36:17] Right, right, exactly. People will over focus on premium, the focus on the deductible as it relates to premium, and sort of miss a lot of miss everything else. And that's true across insurances. With homeowners insurance specifically, there are a few different ways that it's written. There's one where, and it's been a while since I've brushed up on homeowners insurance, but there's one where they will cover the actual cost of replacing something. And then there's another where they use some sort of a formula for a depreciated cost.

Speaker 9:
[36:52] Yeah, replacement cost versus residual cost.

Speaker 4:
[36:55] Or actual cash value, a bunch of different costs.

Speaker 9:
[36:58] Yeah, what you want to do is you want to make sure that... I mean, think of it this way. If your house burns to the ground, you're not going to go get a 2014 television. You can't... Like, that's worth $110. You can't... They don't... You have to buy a brand new one. That's... But the insurance company would say, well, you've had that TV for like 10 years, so it's only worth 100 bucks. Or your appliances or whatever. On the house insurance front, I would also add that most people are under-insured on the rebuild value of their house. Because you get... You do whatever the insurance company tells you to, and then it just increases or whatever. But I had an agent one time that asked me, they said, out of curiosity, if your house got leveled in a tornado, based on what you know about the environment, all that sort of stuff, and the costs, whatever, what do you think it would cost to rebuild? I said, oh, actually, our neighbor's having that happen. He had a house fire. So I know it would cost this. They go, why is your insurance for 60% of that number? It's like, oh crap, I didn't even think of... You just do the thing, right? If you don't have a good agent, like you said, Jesse, if you don't know anything about insurance, you just get whatever the mortgage guy tells you to get when you buy your house and then you just let it go for the next 20 years. But in reality, your house is increasing or labor costs or supply and demand becomes realistic.

Speaker 4:
[38:16] It's funny, there's so many loopholes. Do you know the 80% rule of... It's like the 80% of replacement value rule, OG, where it's like, imagine your house cost $500,000 to rebuild, but you only have 300,000 of coverage on it. So the 80% rule says you would need at least 400,000 of coverage on it. Otherwise, even if your fence blows down in a windstorm and you're like, oh, it's only $1,000 to replace my fence, the insurance companies would be like, you're underinsured and we're only going to pay you a pro rata portion of the $1,000 to replace your fence.

Speaker 8:
[38:47] Wow.

Speaker 4:
[38:47] So it's just like there's so many funny little things like that too that can come up in the insurance world.

Speaker 8:
[38:53] This is actually the reason why I like talking to agents. I like having an agent. I have an agent for my insurance because when I talk to my agent, there's so many little loopholes that they know. Like as an example, my agent told me that if my carpet gets destroyed and it is my dog that did it, then it's not covered because that's a family pet. But if I accidentally left a door open and a raccoon did it, well, then it actually is something that they would cover. Not that I would lie about mine.

Speaker 9:
[39:29] In unrelated news, the raccoon population in Texarkana is wild. Let me tell you.

Speaker 8:
[39:38] I can't believe how many raccoons have been in my house lately. It's amazing. I'm not telling people to lie, but it is interesting to know where these different lines are drawn. I love what you said, OG, about this idea of going back and looking at the numbers every few years, because how easy is it for us to just renew again? Renew it again, renew it again, renew it again, and before you know it, 10 years has gone by and housing prices have gone up a lot, and you're still covering the same basic amounts. Let's move on to brokerage accounts. Jesse, you're looking at a brokerage account, you're saving for multiple goals there. Maybe you've got your 529s for two kids, not that you would do anything like that, or just a regular brokerage account with different funds in it. What's the first thing that people should look at that maybe they don't?

Speaker 4:
[40:31] The easy and obvious answers, I think, are similar to the 401k, right? It really is. I think it's like the balance and the rate of returns and the allocation and where your dollars are. I think those are kind of the easiest things. So what are some things that people ought to look at that maybe they're not? My mind kind of jumped to the tax planning angle, which is like, you know, there's a lot more, there are a lot more tax planning opportunities inside of a taxable brokerage account than there are inside of a 401k. And so just understanding, for example, like, oh, these are still short-term gains or short-term losses versus long-term gains or long-term losses. And if I was planning on doing anything in this account, I ought to have that in mind. What kind of dividends are being paid out on an annual basis from your holdings? And those are going to be taxable this year. So you want to be aware of those kind of things. So I think that might be the low-hanging fruit that maybe not everybody is looking at, is the tax planning angle inside of a brokerage account.

Speaker 8:
[41:23] Yeah, I think too few people look at what's the tax drag on this investment, OG.

Speaker 9:
[41:27] I mean, it's a big number. I mean, what does Vanguard say? It's a solid 1% or something annually, give or take, you know, added up over time in terms of the impact of tax management. So yeah, it's a big thing.

Speaker 8:
[41:39] What about, Paula, like dividend reinvestment options inside a brokerage account? Is that something we should be looking at or looking into?

Speaker 2:
[41:46] Yeah, you know, in a taxable brokerage account, my preferred strategy is not to reinvest the dividends because oftentimes that will result in the asset allocation getting tipped way more out of whack. Instead, don't reinvest the dividends. Have the dividends accumulate in the taxable brokerage account as cash and then use that cash to buy into the underperforming asset so that you can, through purchasing and not through sale, reallocate the assets in that account.

Speaker 8:
[42:18] You better have a calendar reminder too. I mean, that feels like it could get a little manually intensive.

Speaker 2:
[42:23] Yeah, yeah. I mean, depending on how many assets you have there. I mean, if you're checking the account, like you're with mine, I use Schwab. They very clearly show you, like, this is the cash balance versus this is the invested balance. So as soon as you're looking at it, boom, like you get so used to seeing zero in the cash column that the minute it's any number that's greater than zero, you're like, hey, look at that.

Speaker 8:
[42:48] This is also the place, OG, where people take a flyer, right? You can take a flyer, you just do it inside your brokerage account. I feel like this is also can be the land of misfit toys after a while, where you've got a bunch of flyers gone bad that you're hoping one day make it back. Like, I don't know, maybe there's a little weeding the garden that needs to happen too.

Speaker 9:
[43:05] Yeah, for me, from a brokerage standpoint, it's kind of like the credit card statement. I want to go back and look at the transactions and make sure that they all line up with what I expected to have happened over that period of time, whether it's systematic investing, whether it's the dividends that posted, all the things that I expect to see in there. Not that there's not fraud in brokerage accounts and that sort of thing, but there's opportunities for fraud there, more likely to happen with your credit card and your bank statement probably than your brokerage account in terms of what you'll see happen. But I still want to have an idea of what's the day-to-day thing going on here. Like Paula said, you should have a pretty good idea of how much cash you have or what you should have. Generally, cash in a brokerage account is sucky because they don't pay you good interest on it. If you do want to keep cash for the dry powder effect, you want to make sure that that's in the right spot in terms of cash investment. I'm looking at the transaction history. That's my number one.

Speaker 8:
[44:06] Well, that also, Jesse, helps you look at your investment policy statement and go, am I actually following this thing? Because we had our people on talking about stock market maestros. It's one thing to have an investment policy. It's another to go back and do the Maury Povich, again, like we were talking about earlier with Paula, where you say you have an investment policy statement, your transactions say otherwise.

Speaker 4:
[44:26] Yeah, yeah, you are not the father. Well, for the 401k and the brokerage account, when it comes to things like rebalancing, I am a big proponent of exactly what Paula said, which is rebalancing as this giant exercise that you do to really get everything back on level terms. Maybe that's a once or twice a year thing, but maybe on a monthly basis or maybe on a quarterly basis, you're looking at how much cash you have on hand or you're looking at your new contributions into the account, and you're using that to get these small rebalances in throughout the year for sure. But as far as the IPS goes, Joe, for me and the way I think about it, that's like a once or twice a year. You look at your statements, you whip out the IPS and you make sure that your asset allocation is in line with what you agreed to beforehand before you started investing.

Speaker 8:
[45:14] Yeah. I love it that they even admitted that pros make those mistakes. Yes, we have an investment policy, but we sure like to window-dress every quarter.

Speaker 4:
[45:23] Yeah.

Speaker 8:
[45:23] Well, that is a great list of things for us to look at. I hope, Stacker, you got a lot out of that. I certainly did and I think that be a little more diligent here, especially on a Friday. You've got the weekend now to go through these statements and take a look and see, are you following some of these things that these fine people have mentioned in today's show? Let's talk about what you got going on here this weekend, guys. So, man, we're rounding the corner in May, OG, and headed for June, unbelievably. What do we got here this third weekend in May on your calendar?

Speaker 9:
[45:59] I mean, I know we record early, but are we recording six weeks early?

Speaker 8:
[46:04] April, oh my God.

Speaker 2:
[46:11] I was just thinking everything I just said about Monday, May 11th, now out the window.

Speaker 9:
[46:17] I was like, holy crap, dude, I don't know what I'm doing tomorrow, let alone in May, for god's sake.

Speaker 8:
[46:20] I already feel like the year's going fast, and I just made it go even faster. How about April? Yeah, we're getting close to May. So now we're rounding into the second half of April. What do you got going on, OG? That's what I meant.

Speaker 9:
[46:33] We have a final after-school activity this weekend for the spring semester season, whatever you want to call it. And it happens to be down by my kiddo at A&M. So I'm going to go do that and then go hang out with him, his birthday's in a couple of days. So I get to go take my kiddo out to dinner for his birthday right before he wraps up his first year of college, and then turn around and go back and pick him up and all his crap.

Speaker 8:
[46:54] First year of college.

Speaker 9:
[46:55] All of him back to down.

Speaker 8:
[46:56] And time flies. That's so scary. They'll be there before you know it, Jesse. They'll be there before you know it.

Speaker 9:
[47:01] Save now, early and often, buddy.

Speaker 4:
[47:04] Yeah, right. I do need to still set up my second 529 because we only got a Social Security number in the mail last week. So now I can do that.

Speaker 9:
[47:11] Get your Trump account.

Speaker 4:
[47:13] That too. That too.

Speaker 9:
[47:14] A thousand bucks.

Speaker 4:
[47:14] I think two ex-Trump accounts. Our first child is not going to get the thousand dollars, but our second child will.

Speaker 8:
[47:21] What's going on at the Pflitty Podcast? The Personal Finance for Long-Term Investors Podcast.

Speaker 4:
[47:28] I'm legitimately excited for next Wednesday's episode. It actually relates to something we talked about earlier. The working title is Target Date Funds Much Worse Than We Thought. Clickbait. But it actually is. It's research out of...

Speaker 8:
[47:43] Can they get worse than I thought? Because I've been on record of thinking they're pretty damn bad.

Speaker 4:
[47:48] The quick takeaway, and not that I want to spoil it for listeners, I do hope you go listen, but the little takeaway, the number to keep in mind as the big takeaway from this research out of either Arizona or Arizona State, forgive me, Professor, is the average target date fund underperforms a identical basket of index funds by about 1.1 percent a year.

Speaker 8:
[48:10] Wow.

Speaker 2:
[48:11] Is that because of the fee drag?

Speaker 4:
[48:12] About half of it is because of the fee drag itself. And then the other, there are two main constituents of the 1.1 percent. The two biggest constituents, one is just fees, just straight up fees. The second one is that a lot of target date funds are built from actively managed sub-components.

Speaker 8:
[48:28] There it is.

Speaker 4:
[48:29] That of their own investment merit are underperforming the indexes. It's something like 50 or 55 basis points is from the fee and 40 or 45 basis points I think is from the simple underperformance of the investments themselves.

Speaker 8:
[48:41] Tony Bourdain wrote a book called Kitchen Confidential, some of you might have read. He talks about Sunday brunch is something that you may want to avoid because Sunday brunch is all the crap that couldn't sell mixed into salads together. I feel like target date funds, Jesse, are the Sunday brunch of the financial industry.

Speaker 4:
[49:01] Mark, this has already been recorded and it's already published basically. It's just waiting for the date. People will hear me use Tony Bourdain's fish soup metaphor. Because I think he has a fish soup metaphor that he uses as well, which is like, when you order the fish soup, you just might be getting the nasty ingredients that are just accruing in the kitchen. There is absolutely that. I'm sorry I'm taking so long here, but this is something that I have had to change my mind on. If you would ask me two years ago about target date funds, I'd be like, for God's gift to earth, they're amazing. Everything's great. Because I think at one point, they legitimately were and maybe for certain circumstances, they're fine. But only some of them are fine. Many of them are not fine. So anyway, I've had to change my mind on target date funds. Yeah.

Speaker 8:
[49:46] I just think that we're all smart enough to put together four funds, you know, of our own, that will get rid of so many problems and that helps us track a little better, like we can be a little more interested. I can't wait to hear it, Jesse. That's a personal finance for long-term investors. That's going to be great. Speaking of great, Paula, we had such a great time at Texas A&M. I was so happy that you were here. People heard it last week. Thank you so much.

Speaker 2:
[50:11] That was awesome. Thank you for inviting me. That was so much fun.

Speaker 8:
[50:13] I was so proud of Texarkana that day. Those students were so smart and nice. And oh my goodness, did they love you? They absolutely did.

Speaker 2:
[50:22] Well, I love them. I had a great time. They asked some great questions.

Speaker 8:
[50:26] They certainly did. I've got one great question for you. Yes. So what's up next? How do you top that on Afford Anything?

Speaker 2:
[50:32] Well, I don't top it. I don't top it. But we do have Ron Lieber coming on the show.

Speaker 8:
[50:37] He is such a great guy.

Speaker 2:
[50:39] He is the author of many books on personal finance, including one that's called The Opposite of Spoiled. It's how you raise kids who are not spoiled. He makes the point, he's like, you know, we don't even have a word for that. Like in food, if something is not spoiled, you'd call it fresh. But what do you call a person, a child, or an adult who is not spoiled? Like you wouldn't say that they were fresh.

Speaker 8:
[51:01] Doug would say you call it Doug.

Speaker 2:
[51:04] But if we talk about a lot of things, our conversation largely revolved around the price you pay for college. Yeah.

Speaker 8:
[51:12] Yeah. OG might know something about that too.

Speaker 1:
[51:13] It's awesome.

Speaker 8:
[51:16] Love it. Thank you, everybody, for hanging out with us today on YouTube. Again, if you want to join us on YouTube, it's Monday afternoons. We're liable to hear about mid-afternoon. If you get the 201, we also send you exactly ish what time we go live. Depends on today, we had a few computer snafus, so got here a few minutes late.

Speaker 9:
[51:34] Who's this we keep talking about?

Speaker 8:
[51:36] Yeah. The Imperial we.

Speaker 9:
[51:37] The Royal we.

Speaker 8:
[51:38] The Royal we. Yes, absolutely. You know what? Take this weekend. Go through your financial apps and look for some of the things that Jesse, Paula and OG discussed. That's going to do it for us. Doug, you've got it from here, my friend. What should we have learned on today's show?

Speaker 7:
[51:56] So what's stacked up on our to do list for today? First, take some advice from our team and scour your statements. Even though the Internet has made it easy to avoid the fine print, sometimes that's where the gold is. Second, schedule times to revisit these documents on an ongoing basis. By checking once or twice yearly, you'll confirm nothing has changed. And if you had life changes, that schedule will make a marker to adjust your tools to ones that are more appropriate. But the big lesson... Speaking of appropriate, it is not appropriate for Joe's mom to talk about the old Woolworth's ice cream counters. Fairly certain she doesn't know what she's saying when she says, her milkshakes bring all the boys. Oh, God, no, mom. No, mom. Thanks to the new father of two, Jesse Cramer, for joining us today. You'll find his podcast, Personal Finance for Long-Term Investors. Sidebar, how the hell does he find time to podcast these days? But he's yawning through the whole thing. Anyway, you'll find his podcast wherever you're listening to us right now. We'll also include links in our show notes at stackingbenjamins.com. Thanks to Paula Pant for hanging out with us today. You'll find her fabulous podcast, Afford Anything, wherever you listen to finer podcasts. Thanks also to OG for joining us today. Looking for good financial planning help? Head to stackingbenjamins.com/og for his calendar. This show is the property of SP Podcast LLC copyright 2026 and is created by Joe Saul-Sehy. You'll find out about our awesome team at stackingbenjamins.com along with the show notes and how you can find us on YouTube and all the usual social media spots. Come say hello. And oh yeah, 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 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 Benjamins Show.