Welcome to How the Money. I'm Joel and I am Matt. Today we are answering your listener questions. That's right, Joel, we have a listener questions Monday episode. Here. We've got several awesome questions that we're gonna get to, including one about the hidden expenses that a company investing and this one's from a recent college graduate that's asking that one. We also have a question about how to avoid the negative impact on your income based repayment plans when you
have student loans because you're earning too much money. That's an interesting predicament to find yourself in. And we're gonna get to our thoughts on buying a vacation property. Plus we've got two other great questions that we're gonna get to today on this episode. Nice sounds, other comment keep stretching it out. I look forward to it. Yeah, there's there's some good ones that we're gonna talk about today, and some some of these subjects we haven't really talked
about that much. So before we get there, Matt, I wanted to just mention I don't really get on Twitter very much. I feel like Twitter is more of a time suck for me. If I do get on it, and I don't know, I don't really get a whole lot out of it, but I did stumble upon this talking about all the different ways that Twitter is the worse, But then you're gonna talk about something that you love
about tonight. So there's this one worthwhile follow that is really just a sign time stuck too, because it's uh TikTok investors is the the the handle, and so it's just literally someone posting videos over and over like every day of somebody giving idiotic investment advice intment advice. Yeah. So if you're like on Twitter on the rag and you occasionally, you know, want to chuckle in your feed,
that's definitely something that's worth worth checking out. There a lot of like terrible crypto advice or just investing advice in general, just like this nineteen year old who's driving like fancy cars and houses and it's like, gosh, I get it all from the bank. Yeuys, it's like cool man, that's called debt. It's what nobody is that free? Yeah. Yeah, make sure that you note that this is for entertainment purposes only. We're not endorsing any of those pieces of advice.
I thought you were gonna try to get me to get on TikTok. Well you can if you want to. I think we we have our handle claim we just haven't started using. But yeah, we've got how the Money pod. But I'm not really interested in jumping on another social media platform doesn't necessarily align with my personal goals, which is, yeah, like you said, trying to avoid time disappearing at all
the different random hours of the day. You know. Like I read something recently where they talked about how we have so many different things now that distract us and keep us from essentially being bored where And it's those times of being bored that we often times find the
motivation to do something like meaningful or impact or really good. Uh, it's not the best ideas come from sometimes too, It's like we're missing out sometimes on the inspirational idea that pops into your brain, you know, Like now it feels like the shower is the only place where you have any of that for you for room to think, you know, and even then, I I've heard of folks listening to podcasts in the shower because you know, the newer phones
are all waterproof. Is yours waterproof? I don't think so. Okay, Well, while all the newer iPhones, they all are rated to a to a certain level, and so folks are just bringing their phone into the shower, just setting it up there on the shelf. You can even do that, but man, I've started to it's a sacred place though. Yeah, it is. Seriously. I mean for me literally, the ability to not really let my mind actively think about anything, just to let
it wander. Not only is it a cleansing from you know, for the outside of my body, but I feel like it's almost like this mental clearing away before I go to sleep. I'm a night shower. By the way, we talked about this before night showering for life. You and your early morning showers canna get out of here? Man, All right, well you don't have to get hustle about it, but uh no, I agree. I think, yeah, the the being board a little bit more would probably be a
good thing for us in general. Um. But yeah, but if you're on Twitter TikTok investors, well I'll link to that in the show notes exactly. Yeah. Do you know if there's an Instagram equivalent, because I feel like Instagram is more of my social media. I don't love to look it up. I've got someone started that. Yeah, all right, Matt, Well, let's keep moving on. Let's mention the beer that we're having on the show today. This one is called the Bane and the Blithe. It's a wild Ale by New
Grass Brewing Company. You picked this one up while you're in North Carolina, so looking forward to drinking this very interesting wild they all made with prickly pair. Yeah. We'll talk about this at the end of the episode and forward to it. But let's get to sublsit. Our questions for folks out there who you know might have a money question or maybe a tangentially related question that maybe uh more, maybe it's more lifestyle, but it has something to do with money. We'd love to talk about it
on the show. You know, you can go to our website how to money dot com slash ask. It's really simple to submit your question to us and hopefully we can take it on an upcoming episode. Matt, let's get to that. The first question for this EPISO, this one is about a random finance charge that you might get if you sign up for a specific credit card. Hi, man, Joel, this is John from Beaverton, Oregon. I was planning a
trip for myself and my wife with Delta. But when I got to the final page where you pay, I saw an offered to apply for the American Express Delta Sky Mouse card. It offered a nice bonus statement credit and a nice bonus miles on your first purchase. But when I looked at the rates and fees page, I noticed a plan fee or a fixed finance charge of one point three What is a plan fee and how does it affect our coincide with the a p R. I love the podcast, all right, Joel, let's talk about
credit cards. First of all, you gotta love those credit card sign of bonuses, right, They can can be a really nice incentive to get us to open up a new credit card. Specifically, we've recently talked about the Chase Sapphire Preferred Man. If you have not taken advantage of a sign up bonus recently, that is definitely one to consider because fifty dollars and that is a lot of money that's available. It's pretty rich, it is. And we'll make sure to link to our credit cards article in
our show notes for this episode. But John, so for you make sure that when you open a new credit card and you start spending that you have the money to pay that credit card off not only on time, but in full. Anytime we talk about credit cards, it's always the first thing that we want to make sure to cover. But it's also important to be strategic about how and when you open your new cards. The question you might want to ask yourself is you know this
Delta AMEX, is this the best card for you? Well, you know, maybe, like if you really love flying Delta, for instance, if you're really brand loyal, this might be a card that might make sense for you, But you know, you might do better signing up for another card with you know, either more flexible rewards or maybe that richer sign up bonus. Like Joel mentioned, just because that card is shoved in front of your face doesn't mean that
it's the best one for you. In the same way, a lot of times we'll get different credit card offers in the mail. Well, just because it shows up in our mailbox and we're looking at it, sometimes we think, well, it's right here, Mommy's well, go ahead and do it. It sounds good like two sign up monus. Maybe I should just snag this because they send it to me. I must be perfect for this card, or this card
must be perfect for me. In reality, not so much. Yeah, not not always a case, and in fact, most of the time not And it's like when you're, you know, signing up for a flight, it's like, look, you can get your check bags for free if you sign up for those credit card, and you're like, dang, that will save me forty five dollars. I guess I should do that. But in reality it's you know, there's a good chance
it's not the best credit card for you. But let's get to your specific question, John about fixed finance charges, right, Because the a p R or annual percentage rate is a term that everyone sees whenever they're looking to sign up for a credit card. It lets you know what you would be charged on an annual basis, uh, if you were to not take Matt's advice and you didn't pay your bill off on time and in full um and basically those those rates are normally in like the
eighteen percent range. So yeah, some credit card offers will charge lower aprs. For instance, like credit unions, you might be able to find a card the charges in the low double digits. When it comes to the interest rate, UM.
Other companies will offer like a zero percent a p R for a certain time period to entice you to sign up, and also they might allow you to transfer a balance UH and keep that balance at zero percent for a certain amount of time, which can be helpful for a lot of folks who are trying to pay off credit card debt quickly and they don't want to
be paying interest at the same time. But yeah, to be honest, it's just not something that how the money listeners who do hopefully UM pay their credit cards on time and in full every month. It's not something they should pay a lot of attention to. We think paying attention to the rewards and the perks is more important because the only way you should be even getting or using a credit card is if you're using it wisely, and wisely means never paying interest to the credit card companies.
That's rights. But John, you know, this fixed finance charge that you're talking about is actually something different. American Express started offering what they call pay it Planet options a few years ago, and specifically with the Planet option, they are allowing folks to pay off these just different larger purchases with a smaller monthly fee, which is the one point through three on a monthly basis in the case
of the card that you have. But if you opt not to use the planet feature, then you won't be paying the fixed finance charge that you saw. Essentially, this is what American Express would call sort of like a new feature. But we're not fans of any feature that's going to cost you additional money on any of your purchases. Again, like this fee shouldn't matter to you because the way you're using your credit card exactly, say, actually, don't use
that feature. It's it's more like a bug in the feature. Uh but yeah, yeah, Now the the pay it feature is something else, Matt, And that's like, that's totally free actually to people. It allows you to immediately pay off a charge instead of counting towards your balance at the statement closed date. So yeah, this is very similar to people wanting to pay their credit card balance like three or four times a month, like maybe paying it every week in order to make sure that the end of
the month they don't have a really big bill. Um. And it allows some people to budget a little bit better, right, And so let's say you just bought something that was kind of expend too, and you didn't want to wait until the end of the building cycle to pay it off. Well, you can use the pay it Now feature and go ahead, uh and pay for that item in particular, and so that it's not going to show up at the end of the month. You're gonna get rid of that charge immediately.
So yeah, if someone out there is listening and they're really diligent about keeping their credit utilization low, this is a helpful offering. But it's really no different than just choosing to make a payment towards your balance, like I said, every week or you know, more frequently than you normally would. It's really the same thing. So that's kind of how that particular offering from American Express works. But for us, it's just a little more in the gimmick department then
in the it's actually gonna help you out department. Right, it's just another like you said, it's another way for you to pay down on your balance. And the thing is, I think most folks who probably keep up with their their balances that closely where they're looking to pay it off every week like that, that person probably doesn't need a little special button where they're able to pay off purchases because they're already paying close attention to what they're
spending your money on, right. Uh. And so John, you know, we want you to avoid paying interest to the credit card companies all together. And so, whether this is through a monthly installment plan that they offer or just by not paying off your balance and full at the end of the month, we want you to avoid either one of those things, paying any interest or any unnecessary charges to the credit card companies. This is going to be a recipe for personal finance failure. So, yeah, do use
your credit cards to your advantage. We actually talked about the different suite welcome offers and other benefits back in episode three d six a couple of weeks ago. Uh, that is how we want you to approach using your credit card, John, But even still only take advantage of those different benefits if you can avoid all the different unnecessary fees and interest payments. Yeah, it's kind of like only jumping in the pool if you know how to swim.
Like That's that's what we can say about using a credit card, Like, don't you know, don't even give your toes in. It's a lot of fun. It's great. Uh, Because then maticon pushing in the back, and then you're like, oh, yeah, if you know how to tread water, if you don't know how to tread water, that it's something you want
to avoid completely exactly. I like that analogy. All right, We've got a few more questions to you to including how do you handle it if you make enough money that it's actually going to increase how much you have to pay towards your student loans. Will get to that question right in for this break. All right, we're back. We're gonna talk here in a little bit about some different hidden expenses when it comes to investing your money.
But first let's take that question that has to do with student loan forgiveness and reduced student loan monthly payments. My name is Heather and I am a public school teacher from Chicago. So I have over a hundred thousand dollars in student loan debt. But being a public servant, I will hopefully qualify for loan forgiveness, but I'm still about seven years off from this. My salary is fixed by my teachers union, so there's very few ways for
me to increase my income. I can't really negotiate a salary, so I teach after school programs in summer school. To do this, I'm trying to pay off about twenty dollars in low interests debt under five percent. I have private student loans from undergrad and a used car loan, which is why I do extra things to make extra cash to pay these down quickly. The problem is, this small increase in income could bump me out of eligibility for income driven repayment plans barely by like hundreds of dollars.
Does it make sense to increase my income to pay off these debts quickly if I risk losing income driven repayment and needing to make astronomical student loan payments. If my student loan payments increased, I would have no margin to save in my emergency fund or my wrath IRA or anything else. Really, thanks for all your help. I've learned so much by listening to you guys. All right, Heather, thank you so much for your question, and thank you
for teaching kids. That's like such a big service amount and I feel like I realized already knew teachers were provided important service in our society, but I feel like I gained an even deeper appreciation. This past year, it was a tough year for teachers. Yeah, as far as being able to facilitate learning at home, yeah, saying yeah totally, And it just it was a much more difficult year for every teacher I know trying to do their job and learn some sort of new technology and keeping up
with kids on a screen. It's just like, yeah, completely different ballgames. Not easy for for anybody, right, Yeah, And Heather, I gotta say to we, we love that you're hustling by teaching more to increase your pay getting rid of some of that debt. Is that perfect motivation to work harder and increase your income. I love that some of those pesky year debts that you've got, like the private student loans, in the in the youth car, are ones
that you're working to get rid of quickly. So let's talk about how you can make more money without raising those student loan payments, because Matt, I think that's important, Like Heather, should be increasing your income, but at the same time, if it means a much larger student loan payment, then I agree, I'd probably sit on my hands too. Well, that's the thing, And we're not even gonna talk about all the different illegal options where she could break the
law do some tax evasion. Obviously we can't and we'll not recommend you do any of those things either. But Speci Bigally, at the very end of your question, you said something. You said that you're contributing to a roth ira, which is very valuable information here for your question. There are very many situations where we would suggest that anyone who is eligible to do so not contribute to a
roth ira. Yeah, yeah, that is that answer rarely comes out of our mouth, like, no, don't contribute exactly, But Heather, in your case, contributing to a traditional ira instead of that rath is going to be the best idea for the time being. This is going to go a long way. Is when it comes to lowering your adjusted gross income and allow you to earn additional money while continuing to
invest for your future. Yeah, exactly. Like, since the government uses your adjusted gross income your a g I to determine whether or not you qualify for the different public service loan forgiveness programs, you want to make sure that
your a g I isn't too high. And since traditional iras are funded with pre tax money, those contributions will lower your a GS, whereas like contributing money to a roth doesn't do that because it's funded with post tax dollars, right, So yeah, because of that, you don't see any auction in your income from those contributions. And for most people
were like, that's okay, not a big deal. But for you, so it is exactly so that one simple change is likely going to be enough to reduce your a g I, allowing you to make more money without raising you know, what you'll pay on your student loans. Plus you can always do a wrath conversion years down the road once your student loans are paid off, like seven years from now.
I guess is what you said. So yeah, for now, we would say, keep contributing to your retirement accounts, but contribute to a traditional ira instead, so do you can make more money and still keep investing for your future.
But the wrath for the time being just isn't your friend, which again is one of the few times we've ever said that because we love the rath ira, it's probably I mean, it might even be the reason why you have started a roth ira, Heather, But in this case, it does make sense to switch gears and open up a traditional ira and you can start funding that one instead of your wrath. And so yeah, this is essentially how you're gonna be able to have your cake and
eat it too. You know, we don't want you to be discouraged or disincentivized from working hard and earning more money, but we also don't want you to miss out on any student loan forgiveness that you might be eligible for. Uh. And here's the thing too, as you're likely going to continue to hustle and earn more, right because you listen to how the money you're getting after it, consider what other retirement plans might be available to you through the
school where you work. You might even have access to either a four three B or a four fifty seven B that could further reduce your adjusted gross income your a g I if you continue to make more money down the road. Like Joel said, you've got like seven more years while you are still within this program. But you know what, if you have two years left in the program, you've you know, you've gotten to where you're
earning a ton more. Will realize that this is a lever that you could pull yet again to sock away even more money, more money that you're gonna have invested. Uh, that's gonna be set aside for your retirement. I love it. But I love that there's just this one simple thing that Heather can do to basically make sure that she's not, you know, working over too many of her dollars every month towards those student loans that are ultimately going to be forgiven tax free. Yeah, you don't want to screw
that up. Ye. Make sure you're crossing your eyes, dot and your teeth on that, Heather. But best of luck to you, um and yeah, get that traditional IRA started. All right. Now, let's get to uh, the next question that we're gonna take on the show. This one. This one's about where you invest and there might not be any mention of fees, but does that mean that fees don't exist? Hey, fellas, this is Josh here from North Carolina.
I am twenty three years old. I'm a recent college graduate from e c U and I have been contributing to both my brokerage account and roth IRA for about two years now. I am in love with the podcast. It's uh, it's been I feel like I found my why with money, and I thank you guys for that. I have a question, though, I was wondering if there was any kind of hidden expenses that you might uh need to look out for if you were to invest in Voo or b t I, specifically through a cash
app or a robin Hood account. Um, I would love the feedback. I will gladly get you all beer down the down the line. Thanks guys. First of all, e c U and that the Pirates, and that where or our buddy Pat went to college Eastern Carolina. It's a good school. I think I actually saw recently a picture of the baseball fielder. It was either their Appalachian state, and it looks like it's in a forest basically like the prettiest thing I've ever seen, the prettiest picture of
a baseball field ever. So I bet it was ECU because app state that's like literally in the mountains in it. Yeah, I think so. All right, Well, I don't know, I'm gonna look up the picture. Maybe I'll post a link to it in the show notes. Uh well, Josh, thank you for that craft beer offer. But more importantly, man,
finding your why is huge. This is something that doesn't get talked about enough in the world of personal finance, but having this ultimate goal for your money, or even just like a five to ten year goal has incredible power to motivate you into you know, and for you to make the right moves with your money. And so yeah, we're really punned for you, man. Uh, that you've been able to identify this so early on in your working
career is huge. I think oftentimes folks start working and they don't have that ultimate goal and they're basically setting off on this path of dissatisfaction either with their work or with how much of their earning because they always feel like that there has to be something, uh else, there's gonna be just a little bit more, and maybe once that happens, then there is satisfaction or something that's realized. But for you, it sounds like you've got that goal
in mind, so excellent job. Yeah. Most people, i think contribute to retirement accounts out of this like sense that they're supposed to and less out of a sense of and that's like the best funding of their future, right yeah, or they're just not at all. Yeah, so that's obviously better than not doing it at all. But having you know, a purpose behind it is going to help fuel those investments,
is gonna actually encourage you to do that. If you can connect you know, what you're doing with an ultimate goal, that's crucial, that's clutch in the personal finance game. Well, uh yeah, Josh, you are doing a great job. But let's also you know, talk about the hidden expenses that you asked about when it comes to where you're actually buying those funds. And we love the funds that you're choosing, funds like VOO and v t I because those are
gonna be able to provide you lots of diversification. Since you've been listening for a while, you know how important we think that it is. But for everyone else, that's Vanguard's smpt F and their Total Stock Market et F. Those are two of our favorite funds for you to consider with a ton of diversification exactly. Yeah, it's if not thousands of stocks exactly. And that is just like a one stop shop, a one stop, low cost way for you to get invested while being properly diversified. And
you know, Josh mentioned the cash app. I love that app. To Matt. That's a way that I transfer money back and forth to friends or a tenant will will maybe pay rent be the cash app, and I think that's wonderful. That way, I don't have to deal with actual paper checks anymore, which is great. But yeah, cash App, robin Hood, they're not ideal when it comes to investing in our favorite index funds or e t s. That is not
the direction we point you in. We think there are better places to actually be buying those funds than an app like the cash apper robin Hood. Yeah, that's right. And you know, the biggest reason to Josh isn't because these apps charge you higher fees to invest, but it's because cash app and robin hood they don't allow you to open an ira a on their platforms. It sounds like you do have a wroth and you are maxing
that out. But for everyone else out there, this is why we prefer M one to those alternative investing app platforms. You can go to how the Money dot com forward slash m one to learn more about why we like M one a lot better. It's got a lot of the similarities to the other apps that people love, but because you can open a traditional or a roth ira a with M one, we feel that it is a
much better choice. And that's because it's really important to be taking advantage of those tax advantaged vehicles before you even think about opening up a brokerage account. It's not that brokerage accounts are bad, but we want to make sure that you have things in the right order first. Yeah, that's true. So, yeah, that's one reason that we're not big fans of telling people to go to cash app
for robin Hood's open accounts. But the the other downside of these apps we've mentioned before is because there's a potential for negative consequences based on our behavior, for because of how we interact with these apps. Right, Like Matt, I recently did open up a robin Hood account and I just invested a little money on the platform, mostly just to test it out, right, and I feel like it had an enormous impact on how much I thought about my investments and my desire to trade more frequently.
And actually, when you take a look at the numbers for how many times a day, not not a week, but a day that robin Hood investors look at the app, it's the average investor, I think, looks at the app and opens it up something like seven times a day,
and that is completely unhealthy. You know, we're fans of telling people to open up their statements once or twice a year, but seven times a day is just insanity, right, So there's just something about it being your fingertips and having super slick interface that makes you want to open it like you would Candy Crush, right and start gaming
a little bit or words with friends. I don't know if anybody plays in anymore, going back to like just like that constant desire to avoid being bored, right, because oftentimes if you're if there's just a lull during the day, or you're sitting at as traffic light and you're looking for that quick little pick me up, you're kind of crossing your fingers hoping that maybe your about your your account balance has gone up, your portfolio has risen in value, and if not, you might be tempted to make a
quick shale or like, I don't know, bail on something. It's a bad approach to investing exactly. Yeah. So, so I think even if Josh just has to go with him one which we much prefer to to some of these other apps, uh, we would say considered not actually downloading the app and only using the desktop interface because having it at your fingertips on your phone is what's going to get a lot of people in trouble. Yeah,
and so Josh. The only other literal expenses associated with specific funds are their expense ratios, which are both point zero three percent for both vo as well as vt I, And that's for the year, right, And so that cost is slowly taken out of the value of the e
T F over the course of the year. And so for example, let's say you bought one share of VOO at around four and so assuming it didn't go up or down in value at all over the course of the year, it would actually decrease in value by twelve cents. That over the course of one year, if you're gonna see it decreased by point zero three percent, you're looking at twelve cents, which isn't a ton of money. I mean, it is really money. There's more than that in my
couch cushions. So let's be honest, that's true. So that's not a reason to go with or to avoid a certain fund if you're looking at an expense ratio that is that small. And so ultimately you know there are no hidden expenses, just those expenses that are listed out there with particularly e T s, and you can you know, whatever E t F or fund that you're thinking about investing, and you can always just google UH. It's simple plus expense ratio and it'll pull up exactly what they're charging.
So it's not like some hidden fee. It's out there in the open for everyone to see. It's usually on their side or morning Star does a good job tracking fund fees and then kind of giving you a little more insight about the fund. Always like love that site if I'm tracking you know, a particular fund, which I'm not usually because I stick to the most basic of all funds, which are yeah, the VT SAX or VOO
like that, That's what I'm into exactly. Yeah. And so you've got those expenses and then other than that, the only the other expenses you're gonna see are the potential tax implications when the time does come to withdraw some money from those different accounts. So for instance, with a traditional IRA or with a brokerage account, you are going to be paying taxes on the growth that you're going
to see within those UH funds there. But with a RATH, just like we talked about with Heather there earlier on, you've already paid taxes on that money that goes into a wrath, so it sits there and grows tax free, you get to withdraw it tax free, and so there are zero tax implications when it comes to ross. That's one of the reasons why we love it so much.
And so just be prepared from a tax standpoint. Uh, if you are putting money either in a traditional IRA or into a brokerage account as well, no doubt so hidden expenses not really maybe in the traditional sense, but hopefully we give you some other really important things to look out for that could cost you money if you were to start investing on one of these other platforms. All right, let's get to a couple more questions, including one about buying a vacation property, but not just for
your own pleasure to write it out. Is that a good idea. Well, we'll get to that and more right after this break. M all right, we are back taking listener questions here on this Monday, and we're gonna get to that vacation property question here a little bit. But
first let's talk about teaching high school students about personal finances. Hi, man, Joel, my name's Jacob and I'm from Texas and I'm a high school teacher and I would really like to do a personal finance unit this year with some of my high schoolers, and I was wondering if you had any recommendations for topics I could cover, or if you know of any curriculum that is specifically for the high school
age students. Some of them are just starting to get their first jobs, and I want to make sure that they get some solid financial knowledge before they graduate. Big fan of the show, Thank you very much for answering my question. All right, Matt, it's the teacher episode out of Money today. I love that. So Jacob not only
teaching kids but then teaching them about personal finance. That's something that we're all about, and we've talked about, Matt, the dearth of personal finance education that's happening in the school today. It's a major disappointment, UM, and it sets
a lot of kids up for failure. So what Jacob is doing not only seeking to teach kids something about personal finance, but trying to make it interesting and covering the right topics is is great, like because that's it's a crucial time, UM at that age to get some practical knowledge that most kids graduate without. So and everything
around them is screaming the wrong message. Like I mentioned at the top of the episode, the TikTok investors that might be those might be some of the things that they're seeing in their feet as they're checking out social media. They might be getting the wrong advice, And so it's at least helpful to have a smart teacher who cares about them counteracting some of that advice and giving them
some of the right information that they mean. You could even probably develop an entire curriculum around just debunking some of the TikTok investing uh personal finance advice that they would see, right, Basically, that might actually make it kind of fun, Like, yeah, picking apart in those arguments, like somebody's argument on TikTok and saying this is why they're this is why this is mostly false, Like here's the
one kernel of truth in here. But in reality, this is not what you want to be doing with your money. But I think that's I mean, you you sort of said this about just making it interesting, Joe, But I think that's what's really important here is just to make sure that you're making it engaging. Right. One of the biggest things I think we've learned doing how the money is that just how the message comes across determines how
receptive people will be to it. Jacob, I'm assuming like you're probably drawn to the show because, in your opinion, you find it interesting, whereas if it was I don't know, just like two older guys even just sitting there just kind of reading from a textbook sort of thing. You're just talking like King James Version English or something like that, you'd be like, I can't deal with these and vows
like that's not my jam, I don't get it. But it's it's it's about finding a way to just make it seem more approachable, so that it's a little more digestible and something that people want to engage with. There's certainly a way to bore people into a coma when talking about a subject, and there's a way to excite them towards an interest in ideas that you're going to
be discussing. And so as a teacher, obviously you know you know that already, but it just bears repeating and it kind of makes me think of we've talked about how we learned about stocks back in elementary school. Even you know the stock market game where you pick a stock and you quote unquote invested it and you see how it does. Well, that was a lot of fun.
It was really interesting because I mean, that's it's it's a part of the reason why it's something that you and I remember, Joel, because obviously it was fun, right, But the problem is is that it saw us the exact wrong thing. So that was an example of like, well, it was interesting, it was an engaged in vidual stock short time. It's like what are we doing? But the lessons that were gained from that hopefully didn't stick with a lot of folks and hopefully they kind of grew
out of that. But obviously you need to make sure that the what you're teaching is actually accurate as well. And so yeah, how it is that you can spice up the concepts of compounding returns or diversification, you know, just the basic principle of spending less than you make. These are all the different concepts that you're gonna want to cover, uh, And those are some of the questions that I would be asking myself. How can I make
those specific topics more engaging and more interesting. Yeah, I'd want to make it interactive, I'd want to make it physical. I'd wanna you know, make it feel real. Yeah, yeah, you have a visceral reaction to to what's being taught. And so yeah, that's the question I'd be asking myself. I think if I was a teacher trying to teach young kids about personal finance, like what what is the way that they're best at receiving information? And then how
can I communicate to them in in that way? And and there's also there's a nonprofit called Next Gen Personal Finance which does a phenomenal job advocating for personal finance education in schools around the country. UM. And they're actually one of the reasons that I want to say something along the lines of close to like twenty five state legislatures have introduced legislation this year alone to try to
mandate personal finance education in schools. UM. And so yeah, that that is a great place to turn as a teacher. They have like lessons and resources along with professional development to help make you a better teacher of this subject. And so yeah, that the website is in GPF dot org and to site you should definitely check out. We'll
link to that in the show notes. But I love what they're doing and I love that not only are they just advocating, you know, on the political scene, but they're also trying to support and help teachers in the meantime because even in the states where it is mandatory, a lot of teachers don't have the support or the knowledge to you know, teach those classes well and next gen personal finances. Trying to say we got your back
on that. You know, we've got your back, We've got the materials because in a lot of those states too, I mean, sometimes it's not necessarily required to be a standalone course. It can just kind of be a unit that they cover within maybe open into U S History and yeah, or just like a general kind of business class, that kind of thing. And we would also highly suggest that you listen to our episode back with Dan LaSalle.
This is episode ninety eight. It's a while ago, but Dan has done incredible work with students in an inner city setting, not just by teaching them the concepts, but by putting money into their hands for work and then letting them see those actual dollars at work with how they choose to spend that money or invest that money. And so now Dan isn't with a specific school anymore.
He's actually working to help other teachers in school systems implement personal finance classes that don't just completely suck, which let's be honest, probably a lot of them out there do. And often that's not the fault of the teacher, Like they were passionate about another subject and then they had you know, someone of the administration said, hey, guess what,
now you're teaching a personal finance class this year. And they're like, Okay, okay, I got I used to teach history, and I'm gonna make it just as exciting as history was. It's like Professor Bins and Harry Potter or maybe they're good at teaching history, but they're not going to teach finance because they don't care about or they don't have the passion for it exactly. So there's all sorts of like hurdles that need to be overcome. But Dan is passionate,
uh and he's done great work in that regard. So yeah, he's a great resource to turn to as well. We we actually put another teacher who listens to how the money in touch with Dan recently he's already helping him create a curriculum for his class in New Jersey. So yeah, we'll we'll do the same for you and make that introduction. Jacob. Dan is just this fantastic resource. He's done so much
legwork developing and implementing a successful personal finance program. I don't think you have to start from scratch here, look to some of these resources that have already been built, that are doing good work, and then piggyback on top of those in order to create an effective teaching platform at your school. And so yeah, we'll actually put Dan's email in the show notes because he told us that
was okay. And so any teacher out there who's maybe listening and they're saying, well, I want my kids to at least, you know, get a couple of days of personal finance education while they're under my wings. Because I care about this a whole lot um, reaching out to Dan could be really helpful. So yeah, great question, Jacob. Best of luck making that engaging in fun this year. And Matt, let's get to the next question. This one is about buying a rental property in a sunny spot. Hi,
How to Money Team. My name is Katie and I live in Southbury, Connecticut. I recently started listening to the show and it's gotten me revisiting the ultimate stretch goal for my life of owning vacation rental properties in places that I enjoy visiting that could be used for short term rental while I'm not there. I love the idea of the condo hotel. I've seen these a lot near Disney World, but I believe they also exist in some
other touristy areas. And as I understand this type of property arrangement, the owner essentially purchases a hotel room and pays h o A fees in addition to their mortgage so that the property management company takes care of bookings, cleanings, maintenance. But please correct me if I'm wrong in that assumption. My questions are, do you guys have any opinions or advice on this type of property and what would be
red flags that you would look out for. I'm sure it varies by property, but in general, do the owners of a unit even make enough profit to cover the h o A fees? And are there any addition KNOWL fees to look out for that the property management company might be charging beyond the h o fees? Thank you so much. I love the show alright, Katie. First, I love that you're pursuing this stretch goal of yours. Uh, you know, magical money progress can happen when you have
these big goals that we're trying to achieve. It's part of why we were so pumped when we're talking with that recent college grad. The ability for him to latch onto the why behind his money and for you having this goal that you're setting out after it is great. And so I think without those different, audacetionous goals that we set for ourselves, it can be so much easier to just spend that money more freely instead of saving and investing to reach the big goal that you've got
set out there before you. Yeah, it's so easy to kind of fritter your money away in little dribs and drabs unless you have that big goal and then it's like, oh no, no no, now I'm ready, Like I am funneling all my extra money towards this instead. But if you don't have that, it's like, Okay, I guess I'll buy that little new higgy or do dad or whatever it may be. Those big goals really do help connect the flow of your money to the places that you actually
wanted to go, not just spending it mindlessly. But let's let's talk about vacation rental properties. Mat It's it's really important, I would say, for Katie to get to the bottom of why she wants to do this. And yeah, we just talked about it's this, this long, long term goal, but I kind of want to go another layer deeper. I want to say, why is that that this is a goal of years? Is it to make money? If so, well, vacation rental properties aren't usually the best way to do that.
There are better ways to invest in real estate that will almost assuredly be more profitable and far easier to manage. So I guess the next question, maybe is it for a free place to stay at the beach? Well, depending on how often you get there, you might find that free, right, Yeah, it sounds nice to have somebody else paying your mortgage and you get to go stay there a couple of weeks out of the year, But that's not always how
it works out. You might find that it's easier and cheaper to just get an airbnb or a hotel when you're there twice a year. The upkeep, the maintenance, and the managing costs, all of those things might mean that it costs actually way more to have this vacation rental than it would cost to rent someone else's spot when you're visiting. So, yeah, I know this is your goal,
but why is it your goal? I would ask. Answering those questions, it's going to give you some really important insight as to whether or not this is a smart move for you as well. Yeah, so let'skind of dive into the numbers here a little bit um. The first one is how long you plan on owning this vacation property.
Since this is a long term goal, it does sound like this is a property that you plan on holding onto for some time, and that's great, but we want to point out that it actually needs to be this long term move in order for it to make sense from a number standpoint, right, you know, on top of that, you want to try to figure out, like what is the likely profit going to be? You're asking about some
of the different costs. It truly is going to come down to the specific property that you're looking at, and so it's going to require a lot of due diligence when it comes to crunching the numbers to see from a financial standpoint, if it makes sense or what it is that you're willing to sign on the dotted line for because the different kind of hotels that you're talking about, they often come with a split um and that actually kind of sounds like a pretty rough split to me.
And you mentioned the fees, you definitely want to ask about the h o A fees. There's gonna be different maintenance fees, property management fees. These are all the different things that you're going to want to ask about when it comes to performing your own due diligence. And here's the thing too, Even once you figure out where things currently are, just know that those fees, they're not guaranteed
to stay the same. So, for instance, if you look into the h o A and UH, you find out that they don't have much money in the reserves, well, there's a really good chance that that fee is going to go up in the near future. That you're going to see either a special assessment or you're gonna see just an overall h o A hike that is likely going to drastically affect how much is gonna cost you every single year, which in turn could impact your decision
to either make this deal happen or to not. Yeah, I would want to talk to other condo tell owners in the unit where you're looking to. I want to want to see how's it been for them, how's it been working with the property managers? Have they been profitable? And kind of like, yeah, what are those numbers look like? Um, what's the stress level of voting one of these places?
What are the homeowners association meetings like? Are they contentious because you know there is a lack of funds though, I would want to talk to specific individuals who have made a similar investment. And ultimately, this is a high risk investment, right, Like condo hotels, they're kind of hot right now, they're booming and for the next year or two, well, they might be more profitable as the economy is doing well and people are looking to travel again in big numbers.
But how long is it gonna stay that way? Well, that just depends right on so many bigger macroeconomic trends, and the condo hotel route is an even bigger risk, I would say than buying like a single family home or even the town home that you can rent out. Well, it's dependent on tourism, right, It's dependent on on travel and people's willingness to spend money on vacation, right, Right, and so yeah, even if you went in that direction, it's crucial to find an experienced team on the ground
that can help you manage that property well. And that's not always easy to do, right. That takes a lot of legwork as well. But we would say, yeah, if you're really really interested in the vacation rental market, um, and it's kind of that conglomerate and of it's a dream of yours and a free place to stay, well, it's probably not going to be a free place to stay. That's not usually how it works. But there are maybe better ways to go about it than going to the
condo tell route. Yeah, and you know, Katie, we're not trying to rain on your parade or but I mean we're had of money and so I think you know, we tend to put more of an emphasis on the numbers on the on the money, right, We just want you to go into it with your eyes wide open, and we want you to go into it with more than enough money to whether any downturns that might come along should you find the revenue to be less than you expected. So again, from a number standpoint, we feel
that this is not the best move. But here's the thing. There are a lot of things that Joel and I spend money on that don't return any money, because to us it means a lot. I mean, this is a part of why we have the craft beer on every single episode. It's something that we really enjoy. It's not because there's a return on investment. When it comes to the craft beer. Once we drink it, it's gone. We have the memories, but that is it. And so you know,
if you can afford it, that is great. We just don't want you to justify, uh I want with an idea that this is going to be a great investment.
If you are going to spend money on this, make sure that you're just kind of being honest with yourself that you're saying, you know what, we're doing this because we've done well with our money over the past, you know, ten thirty years, whatever it might be, and this is something that we are going to really look forward to every single year, twice a year being able to you know,
head down to that condo, hotel. But we just don't want you to talk yourself into thinking that this is just going to be a great move When it comes to the money, it might be, but it's just really hard to tell without knowing the specific property, and you are much more likely to see your investment increase in value when it comes to either a single family home
even real estate there where you live. And then you could even use those profits to fund being able to go to a new Airbnb or even the same house, and maybe you discovered just the perfect house and it's it's a place that y'all go back to every single year. This is one instance where when you combine work with a little bit of play, it actually doesn't pan out
all that great, no doubt. Matt and I can give a quick personal example here, like we're doing some work to our house, and I could think of it as an investment. It's going to make my home more valuable, and part of me is tempted to do that, but I've chosen to think about it only along the lines of the money that we're spending is truly for us to be able to enjoy our house more. And it's
not that it won't increase our home's value. Probably will, And were you to sell it, which God forbid, if you were to sell it, we're gonna happen right after you you finished the renovation, you would get more for it, absolutely, but not as much as I'm putting in and all like that, right, And so yeah, I just have to think about it rationally, or even worse than rationally, like put myself in behind the eight ball even more when it comes to the money that we're spending, just to
help me realize, like, this is not an investment really in the same way that I like to invest money in real estate. This is something very different than that. Um. And so Katie, for you, I think thinking about it like that too, You're gonna have to have more money than you think in order to potentially weather some difficult months in the market, um, if you choose to go this route. So yeah, we just want you to, like Matt said, go in with eyes wide open and make
a wise decision for yourself. But Matt, that's it for listener questions. Let's quickly get back to the beer that we had on this episode. This one's called The Bane and the Blithe. It's a wild Ale by New Grass Brewing. What was your take on on this wildale? Yeah, so
this was definitely an American wild right. It had a lot of acidity, which I absolutely love, and it didn't say here on the bottle anywhere if it was aged in oak, but it seemed to be it had to have been, though, right, Like, it definitely had those okay flavors going on, that okay profile. And here's the thing too, I like, I don't even know what prickly pear tastes. I don't need. The only reference I had in my
mind was like the movie The Jungle Book. I'm pretty sure like blew the bear eats prickly pears in there. What's crazy is my third grader she is at prickly Pear and she talks about how great it is, and I'm like, where the heck was I when you got to prickly Pear? And so in this case, she's more experienced and wise than I am. Well, and let's be honest,
in many other areas too. But if prickly Pear tastes anything like this beer, I say that I must love it, because I really like the way this beer goes down. Definitely has those wild American ale notes. Uh, it's good, it's a it's decently sour too, man Like, it almost has like the Sauer Kraut like flavor profile going on. Do you feel that? Yeah, totally it is really sour,
which I enjoy. And I feel like the the prickly pair brought a little bit of like a citrus night note to almost like a lime kind of flavor going on with this one. And then the oak really balanced it out too. So yeah, a few different notes it was hitting on, uh, and this one was tasty. Yeah, really stinking good in prickly pair in that like the fruit that's on cactus. I think so, yeah, I think so too. Probably let's say yes, I'm not totally sure.
I feel like this is something I should know. Again, if my daughter is here, she'd be like, no, dad, it's this, or she would say, good job, daddy. Maybe she could be my new podcast co host. We can have them sit in some one of these days. Actually, I mean one of these days we might do that. Kids in Money episode slated for release in two years. Yeah, all right, well that's gonna do it for this one.
For folks that want the show notes for this episode with some of the links that we mentioned, just go to our website how to Money dot com. That's right, and we always appreciate any solid reviews left wherever it is that you listen to your podcast, So please do that, but at the very least, if you haven't yet subscribed to the show, we would love it if you were to mash that subscribe button on a phone near you.
Doesn't even have to be your own, Joel, that's gonna be it for this episode, Buddy, mash your grandma's subscribe button. Until next time. Best Friends Out, Best Friends Out,