Friday Flight - Mortgage Rates at All Time Lows and Back to School Spending #231

and back to school spending. By the way, I use that term loosely because I realize a lot of people aren't actually physically going back to school, but there's still money to be spent, right and there's still things that people need, and in a particular electronics right now for a lot of their kids who are doing schooling from home, there are deals to be found. Man, speak of electronics real quick, Are you still rocking your your bone conduction

wireless headphones? I sure am, Yeah, where like the sound vibrates through your your skull bones? Yeah? I really like my They are the Aftershocks brand. I guess there are probably a couple of different brands, but they're by far the most well known and and yeah, I really really like them. I have a pair of over the ear headphones too that I that I use sometimes, but if

you're serious listening, I don't want any noises. It just kind of depends on what I'm doing, especially if I'm riding the bike and I want to listen to something like on my bike commute. I love the bone conduction headphones for that because you can also hear what's going on around you when it comes to pedestrian or carnaways. Yeah, it's like having multiple inputs for your for your brain in those situations. I just pulled one of my earbuds and so I just got there. You go. Both work well.

The reason I asked is I just got some super cheap oh Amazon Lightning Deal earbuds. I've been rocking like these old school ones, the kind that like sits over your neck and then like the wires come out of that thing and then it like loops up and plugs into your ears. They still work, but I am not able to run with those because the thing kind of bounces around on my neck and that your buddsend up like popping out of my ear and plus as well.

I've caught them on my thumbs before, like on my hands, and when they're kind of plugged in your ear and then you remove them quickly, it is not comfortable and it kind of hurts, and actually I think messed up you're hearing. Anyway. I wanted to mention that though, because I was thinking about it, and this is an instance where I was afraid I was gonna go cheap. But I feel like when it comes to certain electronics like this,

it's okay to go a little bit cheaper. Maybe just look for the best deal because man, technology becomes obsolete quick, especially in like consumer electronics like this, and so in this specific instance, I feel this might be an example of where it makes sense maybe to go cheap instead of going with something higher end. But yeah, what are your thoughts? Are you calling me higher end? Is it? Well? Yeah, I mean when it comes to sounds like you've got

a specific brand, you know, after shocks. I don't know what those are. It sounds like a type of shot guns over in a nice tennishoe When now I just heard from people, a few people that are working with that that had after shocks and they were like, they're really great. They really like having the bone conduction instead of just you know, having earbuds that go in your ear. And I've always found them uncomfortable anyway, putting earbuds straight in. Yeah,

oh no, I love those. Ye I hate it, okay, Yeah, I feel I feel uncomfortable. So that's why I'm using the ones that are either over the year or the bone conduction, because I don't like anything in my ear. Yeah, I like it just plugged in there to where I can't hear anything else, like, because I like to use them as kind of like noise cancelation as well. But

that being said, these don't have noise cancelation. These are super cheap thirty bucks literally And that's another thing too, is like they're really small and I'm afraid you might end up losing them, you know, like Apple makes their fancy air pod pros or whatever, um, and you're gonna spend tune with thirty bucks on a pair of those. I don't know how this don't fall out people's ears. I think they have like little inserts in them where they kind of like plug in. They don't just like

rests on the little bowl of your ear. I know, I know that but still I was like running or something like that. Well, that's the thing. Either way, I'm like, I'm not willing to spend that much money on something that is that small that a might be obsolete and and be like that I might end up losing and

the quality isn't bad. That's the other thing. I'm not willing to spend like eight times more are just on something like is it actually eight times better to go with the Apple product, even though I'm all about Apple products like in this case, No, I'm want to keep rocking those l cheap pos unless they break, and then I'll let you know, because that's what I've gone, cheap

and bit being the butts. Yeah, when when it came to getting the aftershocks, I just waited on a sale because I knew that at some point i'd be able to get them forty fifty bucks off and and finally it happened, and so I bought them. I was in no hurry, in no rush, And sometimes that's how you score the best deal on something that you actually really want, just waiting around for the price to drop. All right, Matt,

let's get on to the Friday flight. Let's talk about some of the stories that we found interesting this week, and we'll get to back to school spending in just a second, but before that, I wanted to mention something that I know you're going to be excited about. While a lot of businesses and retailers are having a tough time and some have announced locations closing, all the one

of your faces is thriving love all right. So I just saw a story that seventy all these are set to open in the United States this year, all these and thirty seven states right now, and pretty soon they're going to add another one. They're gonna be in Arizona, and they're just gonna be opening up more stores in states that they are already in as well. But for all of our how to money listeners out in Arizona, you're pretty soon gonna be able to shop at the cheapest,

best grocery store around. Yeah. What I'm afraid of is that these all these are going to get too big, because I've been into some of the newer ones and they are bigger than the one that is closest to where we live. And that's one of the benefits is that they're so small you can kind of get in and out of there. Yeah, I feel like if you, if you normally shop at like Kroger or safe Way, give all these shot because you'll definitely will be able

to save some money. In another quick tip, if you've never been to an Aldy, make sure you show up with your own shopping bag, because they charge you for shopping bags there, and that's one of the ways that you're able to save money. We use the giant blue Ikea bag because you can fit so many groceries in there.

Nice nice. Yeah, well and actually too, even if you don't decide to shop at all the but already shows up in your neighborhood, by default, the prices go down at the place that you're shopping because of the increased levels of competition. So yeah, more all these all around is just better for everybody, even if you don't shop at Yeah man, makes sense. All right, let's talk about

some of that back to school spending. Schools almost back well sort of right, Like your kid may not even need a new backpack because they may not be going in person. You know, zoom calls might be what your school life looks like for the next few months. But the average expected school expenses per family is up this year, you know, which I think is in large part due to needing to purchase another computer just like you mentioned, Joel.

But we want to remind folks UH that even if you don't feel that you have, you know, the technology, the tools to do online school well currently, you don't necessarily need to buy a super expensive computer. We'd recommend for folks to look at some deal sites like deal news or slip deals where you can shop for tech bargains ahead of the start of school. And also too, don't be afraid if you are looking even to buy an Apple product, don't be afraid to buy the refurbished

items on Apple's website directly. Every single Apple UH desktop computer and laptop device that we've ever purchased, Joel Uh. Literally ever we have purchased ref Back in the day, they used to call it refreshed, but now I saw that they just like owned up to it and they're like, it's just referb But they've always served us well, and we've always been able to save anywhere between like ten

even upwards, depending on the item that you get. Nice. Yeah, and then we actually just spent ninety bucks on some power line adapters so that we can have stronger internet in the back of our house where we're planning on setting up the schooling area. So it's kind of part of our additional costs of of school this year, but it should make a big difference in reducing the stress level that we face as we're trying to kind of

help our kids succeed in online schooling. And of course, like all of our roles as parents, if we have kids going to school, it's just ramped up in a big way because most of us are helping out with the learning and helping out with getting our kids into zoom calls and all that kind of stuff a whole lot more than we typically would be if they're just gone at school. Right. Uh, we've got those unpaid teacher

assistant positions now, yeah, exactly. So, Yeah, I understand why why spending overall for is is up, and that's because people need things that they don't typically need in the school year. But there are other things I think you can forego, like a new backpack because who needs it. Yeah. Well, and Jul you know you mentioned that powerline adapter that essentially turns your homes electrical system into like a you know, working ethernet cable because you plug in the little adapter

into the wall and it boosts the signal. That's a great solution. Something else that we've done is we we took an old wireless router and hard wired it to our new one, and using that we rant it to the other end of our house and we're able to turn that wireless router and so basically just another Internet access point, and so it blankets the home in solid

internet coverage. And so if you have like a long, skinny house sort of like we do, it allows you to not just have internet in the back of the house, but also in the front where the offices and the girls need to be on the internet. Yeah, during those zoom calls for sure. Yeah, and the mesh router WiFi mesh routers are kind of all the all the rages these days. But those costs like three times as much

as what we just got. I think it's gonna work better. Um, And yeah, you can do it even cheaper if you've gotten an older router lying around. Most people do because like what are you gonna do with those? You know, Like, I feel like a lot of time they're just like sitting in closets and they're in that same box that you have a bunch of old Ethernet cables, you know, and all my old cell phones that I forgot to sell.

So yeah, uh, Matt, let's talk about tax refunds to everyone out there who's filed their tax return but they did it more recently and you haven't received your tax refund yet, Well, it just heads up. It could take a while before that refund gets to you. Last week was tax Day delayed by three months, of course, and then with COVID shutting down some I r S offices and stimulus checks taking up a lot of resources, tax refunds are going to be slow to get to people

this year. So in particular, if you are old school and sending in a paper return, you'll be waiting even longer. You can check the status of your refund online. Will put a link to the I r S website where you can do that in the show notes. But the great thing is that if your if your refund is delayed, the I R S is going to be paying you interest on those refunds that they weren't able to get

out in a timely manner. Yeah, so it might be a bummer, and especially right now where so many Americans have a reduced income, that tax refund is something that they're in all likelihood wanting quickly, and the stakes are going to be delayed. But at least, yeah, there's that silver lining that you might get paid some additional interest on that refund money. Yeah, and actually saw that the

interests that they're paying is actually pretty great. Uh, they're paying five percent for April through June, and then starting in July they're only paying three percent, but still three percent is huge compared to what the online high interest Savings accounts what they're offering. And so it's actually not a terrible thing that that money's sitting there with the I R S and JO. Speaking of taxes, let's talk

about property taxes. Some local cities and towns are offering extensions to pay property taxes, and even some states like Idaho, they have set up property tax relief funds to provide aid to those who can't currently afford to pay. And so if you're having trouble, you know, paying that property tax bill, be sure to contact your local tax assessor's office. The same thing is true with homeowners insurance. A lot of providers aren't necessarily advertising that this is something that

they're doing. But reach out to both your tax office and your insurance company and see if that's something that you can negotiate, because there might be some relief there for you. Yeah, Matt, we've tried to cover on the show everything that you can do to postpone payments on your mortgage, on property taxes now, and on your car loan.

I mean, there are just so many ways that you can get relief because of COVID, And if you think your job is at risk or you have lost your job, it's important to take advantage of as many of these things as you can because that's going to keep your emergency fund intact. That's gonna allow you to continue to

buy groceries and keep the lights on, that kind of stuff. So, yeah, everything that Man and I hear about, we're gonna relay it on the show because we want you to be okay financially, and so much of that means taking advantage of what's being offered. And Matt, on that note, let's talk about getting out of a lease. It looks like the new stimulus bill it's probably not gonna be passed

until sometime in August. That remains to be seen, but a lot of people could use a direct payment right now to help out with things like rent, and the numbers reflected that almost twenty million Americans are at risk of eviction before the end of September. That's pretty awful, right, But some states are offering a moratorium on evictions, which of course helps the most vulnerable among in so many locations,

but other states have not extended that deadline. So depending on where you live, your landlord might not be able to evict you, and then in other states if you just don't have that protection. So it's important to know your rights. It's important to see exactly what your states government has said about eviction proceedings and whether or not

your landlord can begin the eviction process. If you're having a hard time paying your rent right now, yeah, if that's the situation that you are in, it is certainly good to know what the laws are in your states. But then beyond that, next we would recommend for you to have a frank conversation with your landlord. Uh. You know, when tenants don't respond to the ghost or landlord, chances of working things out in a mutually beneficial way like

that massively decreases. But if you have been communicating and you've been a good tenant, the chances are that they will do their best to work with you through this difficult time. If you're doing your best there, you never know, you might even be able to ask for for new terms even Yeah, Matt, I don't know what you've seen with your tenants, you know. I tried to communicate early and often with mine throughout the pandemic as things are getting crazy and people were losing their jobs or or

having unstable income. And one of my tenants was about and sign a new lease and she just felt uncomfortable going into another year long lease, and I totally understood, but she's been a great tenant and I want to keep her around. So we're we've gone month to month, and we were able to work out a reduced rent amount too, And also we just decided to do away with late fees for the time being, because sometimes you can't pay rent until the tenth or eleventh of the month.

And that's okay for me right now, because things are crazy, right and so we all just have to do our best. But landlords and tenants should be working together to find

terms that work for everybody moving forward. Yeah, that's totally true. Man. However, you know, if you do find yourself in a position where you can't afford the rent, or you know you need to move somewhere else that's maybe a little more affordable, you can also give a thirty day notice that you are leaving and offer to help your landlord find another

suitable tenant. You might receive threats that you'll owe rent for the entirety of the lease that you originally signed and agreed to, but most states require that the landlord worked to fund a new and mitigate that damage. And so again, this is another situation where it is helpful to know what your specific states laws are, but know

that this is a common rule in most states. Yeah, Matt, you said mitigate the damages, and what that means is that the landlord is required to try to find a new tenant to take over your lease and to get somebody else living in the house as quickly as possible. Like you said, right, there's a lot that an individual tenant can do to help that process along by listing the property and trying to help the landlord find somebody

to fill the shoes that you were in. But it's so important for tenants to know that while you could be on the hook for the rest of the least if your landlord isn't able to find somebody to take over, if there is decent demand in your area, this might just be the best move that you have is turning in that thirty day notice and leaving the property and

helping the landlord find somebody else to take over. If you have to move in with friends or family in order to lower your housing costs in a massive way, this is kind of a gamble, but it might be the best thing that you can do for yourself, yeah, man. And also the National Low Income Housing a Lot Alliance. They have a list of resources state by state that you can turn to four rental assistance if you're struggling right now, and we'll make sure to link to that

in our show notes. And on the housing note, let's talk about mortgage rates and some of the nuances you need to consider if you are considering refinancing a mortgage, if that's on the table for you, and we'll get to that right after the break. All right, we're back from the break, Matt. We were just talking about preventing eviction and let's talk about like the flip side of housing for people who own a home or are looking

to buy a home soon. Mortgage rates kind of just hit a magical level where you can get a mortgage right below three, which is just incredible. Yeah, it's been a long time since we've had rates that lad. I think it's been like fifty years since we've dipped under

the threes. Yeah, pretty nut to think you can borrow money at two point seven five percent or two point eight seven five percent for thirty years, right, And there are a lot of people who would be well served by refinancing right now with a bank, credit union, or an online lender. It's so important, though, to think about your specific situation. I had a friend recently reach out.

She's gonna sell her home in probably less than a year, and she's thinking about refinancing, And I was like, no, no, no, no, no, you probably don't. Not for you, Yeah, because you're gonna pay thousands and thousands of dollars in closing costs in

order to make that happen. So a good question to ask yourself is are you planning on being in the home for a while to come right, Because it doesn't make sense if you're not going to be there typically for at least three years, more like five years in a lot of cases, depending on what your rate is, and depending on what the closing costs are associated with that refi because they are all these fees like the appraisal title fees and other loan fees like underwriting and

origination fees. Those can make refinancing cost prohibitive if you're not getting a big enough cut and interest rate and you're not gonna be able to realize it over a long period of time. Yeah, that's true, man, There are a lot of costs associated with refinancing. But what about no closing costs refinances? Those seem to be getting more

steam right now. And basically the way those work is that instead of paying out of pocket for the and costs, which can be anywhere between one and four percent of the overall loan amount, those costs get rolled into the mortgage balance or you'll you know, possibly end up with a higher than market interest rate. And so typically you'll get the best overall terms when you opt not to

go with a no closing cost mortgage refinance. But it could make sense in particular if you don't have immediate access to the cash and you're wanting to jump on those really low rates. But especially you know, in the situation until that you mentioned, this would have maybe worked

for her. You know, if you don't plan to be in the house very long, opting for you know, a slightly higher than market rate, assuming that it's still lower than what you currently have, and then going the no closing cost route can make sense because effectively you're not realizing all of those expenses right then and there. It kind of gets spread out over the life of the loan, and if you know you're gonna move out soon, well

that's something to consider. Yeah, and again, knowing that there are multiple flavors of no closing cost mortgages, that's that's something I actually discussed with her. I was like, if you're just paying an above market rate, but it's lower than what you currently have, then there's like no harm in doing that no closing cost refi. But if it adds a whole lot more of the loan balance at the same time, then it doesn't make sense. Right. Uh So, something else to consider is whether or not you even

qualify to do a refinance. This can be one of the issues that comes up if you're recently unemployed or if you're self employed. But it's slightly affecting a lot more individuals these days because of coronavirus and with banks tightening up on lending standards. So if you've had a salary cut, you're just not making as much as you used to, then it's likely that the debt to income ratio that lenders use when deciding whether an applicant qualifies or not, that those ratios are a little out of

whack for you. A refi or even a new loan that you might have qualified for a year ago might be out of reach, or the interest rate might not be the lowest that's available on the market right, and that's a bummer, But there are ways around this for you. For instance, you could bring more money to the closing table if you have that cash on hand. That's just something to keep in mind if you've been financially impacted

by COVID. It's important to kind of have an idea when you're submitting an application for a REFI of the terms you think you're going to be able to qualify for based on your income, based on your debt, and based on your credit score. Yeah, man, you know, that's actually a situation that Kate and I that we're finding

ourselves in right being self employed. We've seen our income drop because guess what, man, there aren't a whole lot of big in person weddings happening in a lot of small backyard elopements, and we were not expecting to see that impact our ability to potentially refi a property. So in our case yet, we we've kind of been talking about potentially looking to maybe even focus on paying down a mortgage of an investment property a little bit early.

But that's something we can maybe say for another episode because there's kind of a whole lot of psychological things to kind of talk about when it comes to that as well. I'm not a psychologist, but I'll dive deep. That's the hard questions, uh, Matt. Another thing too, I think people are actually doing early you know you said you might pay off your mortgage early. Well, other people are actually pursuing buying a house earlier than they otherwise

would have because the rates are so low. And I think for for a lot of our listeners who have put themselves in a good financial position and they were like, yeah, I might buy a home in the next two years, But I don't think right now, with rates being so low, I could understand why they might be interested in accelerating

that decision. And I think sometimes like market conditions, right, getting something on sale or getting a better value like locking in a thirty year mortgage at two point eight seven vibe or something like that, can make it worthwhile to bump your plans up. But I think only if you're underlying financials are in a really, really good place, that is when I would say, yeah, I go for it, bump up that timeline and make it happen. That's right, man.

And one other thing we wanted to cover we saw that consumer choice it is vanishing due to the coronavirus. We're seeing fewer options and lots of different areas, ranging from grocery stores to restaurants and even to auto and motorcycle manufacturers. A lot of this has to do with the fact that there there have been just supply chain bottlenecks, you know, and manufacturers an ability to really just get

goods and parts two retailers. So you know, it's partly a business decision, as businesses are focusing on just trying to keep up with the high demand you know, they're they're looking to just keep the basic items on the shelves. You know, who cares about all the different varieties of you know, fat free potato chips or all the different kinds of motorcycles that they used to sell, and they're just trying to look to maintain some of the basics.

Some of those companies are looking to cut some of those zombie brands right that aren't making a whole lot of money. So, you know, don't be surprised if you don't see your odd walla smoothiejuice on the shelves next time you go to the grocery store. Oh, man, I hope there's one thing that I tried recently. My dad had some at the house. It was a combination of dr pepper and cream soda that shouldn't exist. Man, that's one of those things I think they should cut from

the rotation. It was terrible. Apparently my young nephew really likes it. Uh. But from a consumer's point of view, Matt, I think things aren't super stable on the income front for a lot of us right as we've been talking about, so it's natural to see a shift towards kind of the basics compared to just the endless options that we used to have. A lot of the country is taken kind of a batten down the hatches approach, and they're finding ways to reduce their spending and so skipping super

niche things like organic toilet paper or whatever. Altogether. It's it's one of the natural consequences of economic uncertainty, and it makes sense that certain companies might be limiting their offerings. And part of the reason I think this is actually a really good thing is that decision fatigue is real,

and it affects us all right. With with so much going on all around us in our lives and the economy and just kind of general uncertainty, We're living in a typical times, and I'm sure most folks are actually searching for ways to reduce the number of decisions that they have to make in daily life, to provide a little ease and a little piece And I think having fewer decisions at the grocery store, fewer decisions with the things that we are on shelves that we might consider buying,

is actually better for our brains. I think it's helpful to fewer decisions. Oh yeah, man, I'm always looking for ways to put things in my life on autopilot. And plus you know the health risks as well. I don't forget those like who wants to spend a ton of time in the grocery store debating their different options when you've got like another shopper without a mask on breathing

down your neck. You know, we mentioned all the at the beginning of the show, Like, that's another one of the huge was going with Ald, Like you really can be in and out of there in one minutes. Like I feel like I mentioned that before in the show, Like, but one of these times, I really I'm gonna time myself. I wanna hit hit go on the stop bots, gonna run in and grab milk and eggs, which is oftentimes what we need right just like to restock for the week and get out of there and see how long

and it can actually take. But like, I love how small those all these stores are, because you really can make it happen so quickly. Yeah, and you realize too when you're shopping at all the oh, I didn't really need twelve different kinds of all the different options. Yeah, yeah, exactly, So I agree. That's one of the things I love about aldi is that you don't have the decision fatigue that comes from going to the grocery store and it

doesn't take nearly as long. Yeah, I'm with you. You don't have to devote an afternoon of your weekend to go into Costco. All right, I'm done with you. Our friendship is over. Uh you wish you can't. You can't hate on Costco, man and get away with it? Not not on this podcast. Now. They're both great, Man, They're just great for different reasons. For instance, I really appreciate that cooler backpack that you guys picked up for us the last time you're at Costco. That thing's been clutch

the summer. Yeah, it's uh, it's pretty helpful, isn't it super helpful? All right? Well, that's gonna do it for this episode. If you want the show notes, including a link to those adapters that I bought, they're gonna massively help our WiFi and the list of resources that can help you if you're struggling to pay your rent will link to those in the show notes as well as other things, and those are available on our website at

how to money dot com. And if you've been listening to our show and you've enjoyed it, we would love for you to leave us a review over at Apple Podcast specifically. That really helps us out. And you know, while we're giving Aldi some love, if you haven't left us a review yet, go over there, and when you leave your review, let us know what item you specifically love over at Audie. I, for one, I'm a huge

fan of their basic vanilla ice cream. It's in this black cartain and people I've talked to multiple people and everybody loves this ice cream. It's literally got like I think, like six ingredients or maybe even like four, but it's super like pure. There's not a whole lot of preservatives in it, and it really is some really dang good ice cream and we're eating a lot of it. This stuff. All right, I'm gonna say the spicy salami and sharp

cheddar cheese. There you gon good comment? Well, alright, man, that's gonna be it until next time. Best Friends Out, Best Friends Out.