Friday Flight - Rate Hike Repercussions, Thieves Targeting Your Car, & Password Sharing Crackdowns #489

to you. That's right. We've got a bunch of stories to get to today, like the ones you mentioned, plus a bunch of others. But first me, can you believe how long we have been podcasting this episode right here? This is episode for what is pretty crazy, right, We're getting really dang close episode of five hundred, which is, first of all, mind blowing. I can't believe we've record that we've put up with each other for that many episodes, that our listeners have put up with us that long.

Thank you listeners for listening to this show. I mean quite literally, we would not have a show without our listeners. I mean we would we just be speaking into the boys, nobody would be listening, and we would probably get tired of that after. Let's be honest, we would still be interested in the topics that we talk about, but we wouldn't I mean, would we actually put out a podcast

if nobody listening webly recording? That would be craziness, uh lunacy if we were to do that with nobody listening. But we are going to celebrate that five episode. Uh. And to what we're just saying, we do want to sort of turn the tables a little bit, and we specifically want to hear from our listeners. We want to hear some of the different money tips and tricks that you have been able to implement into your life. We

want to hear them. We want you to record a voice memo, we want you to send them to us. That way we can share them on the show on that five episode, just like we do oftentimes with our ask kund of Money episodes, but instead of taking questions, we want to hear the different ways that you are crushing your money goals through the different tips and tricks that you have implemented. Yeah, basically, we want to hear your best piece of financial advice. The share preferably in

under a minute. Matt and I'll be able to talk about it, but we will share as many of these pieces of financial advice they are come from our listeners as possible. On episode five hundred and you know, just to sweeten the pot a little bit, we're gonna come up with some We're we're working on a cool piece of how the Money, so we are in the midst of it right now. Yeah, that we will send to and it's it's gonna be cool that we will send to every listener whose piece of financial advice makes it

onto the show. We'll get your address, will send you something cool. Um. But but it's really just a way to say, like, you know what we're we'udition out financial advice all the time on the show right fived episodes deep, but our listeners have so much knowledge to their constantly. We are only two dudes, and we do things in a certain way. I am sure there are a lot of folks out there who probably are thinking, you know, I love listening to Matt and Joel, but I don't

necessarily have an ascount of money question to submit. But they might have some killer advice. Yeah, and they've never mentioned this before on the show the world. Have they left that on the table or and uh, and and listeners are always giving rate advice in the how Money Facebook group. We just want to hear your voice. Is a chance for you to tell everybody out there in the how of Money community the great thing that saved

you money or or helped you as an investor. And it's just gonna be fun to kind of share as many of those as possible just in a few weeks time here on on How the Money episode in that celebration. Just um, getting to include listeners in episodes is a lot of fun. I'm looking forward to this one. That's right, man. And again, it is super easy to record a voice memo on your phone and to just email it to us.

But we will include some brief instructions up on the website at how the Money dot com forward slash celebrate. Just head over there if you are looking for a little more guidance in how to submit those voice memos. Can't wait just basically, you know, take that episode off and learn from our listeners kind of going to like Tom brady semi retirement for a second and let other people do the heavy lifting for one episode. Speaking of Tom Brady, we are going to get to a story

that includes him later on during this episode. But let's go ahead, man, get to our Friday flight. Let's do it. Okay, So the first thing we have to talk about is the federal reserves rate hike that happened this week. And um, yeah, that happened just a couple of days ago. You're you're probably seeing a lot of headlines about it these days

if you pay attention to the financial public publications. But I guess the question that a lot of people have um in their brain right now, Matt, after seeing this breaking news, is well, what does it mean to me? Of course, that's what the Friday flights all about. And um, you know, we want to break down these complicated macroeconomic issues and then discuss how they pertain to your personal finances.

And by raising interest rates, the main goal that the Fed has here it basically, it's to slow down the rate of inflation. That's what we're seeing right, which we're all seeing at the grocery store, on car prices, everything. Right, It's become a massive problem affecting all of our budgets in a real substantial way. And so it's gonna be interesting to see how these rate hikes impact the economy.

Because nothing is certain, right, yeah, exactly. Well, it's important to you to mention to like what this federal rate hike means. Basically, this is like the overnight lending rate that the Fed issues to banks, and so this isn't like a rate that you as a consumer, as a borrower, that you have access to. It's the rate that the Fed pays banks when they deposit their money with the Fed overnight basis. But how it does have trickle down effects,

It certainly does that. Let's talk about a few of those trickle down effects, because you know, it's likely that we're gonna see, um, this impact people most severely if they have variable interest rate debt, so that means credit card interest rates are are going to rise, and if you've got like a home equity line of credit, that rate will also be ticking up the next time your bank is allowed to increase it. But you know, it's less actually about the tiny quarter percent increase that we're

seeing in the near term basis points. Yeah, it's it's really it's not that much this one hike. It's more about the long term additional rate hikes that the Fed has announced, like that they're going to be doing, and so Yeah, now is actually the perfect time to focus on paying down those kinds of debts that you've got that that a variable, the variable interest rate debts before those rates rise even further. You know, folks often want to know, well, does this mean mortgage traits are going

to go higher? They have been going up in recent months, and ebody's paying attention has seen that they're actually the highest they've been in three years now. But this rate bump doesn't actually mean that that mortgage traits are going to take up. Mortgage traits are kind of complex in in how they're figured out. But yeah, they might even take down over the next days, maybe the next couple of weeks. That remains to be seen. But yeah, if you have variable interest rate debt, now is the time

to do something about it. Now is the time to start getting rid of it. That's right, man, And to sort of preempt another question, no savings interest rates, they won't be going up. We've we've touched on this before. But the reason that banks pay interest to customers, uh, is because they want your money to be on file with them. They take that, you know, those deposits, and then they can do other things with that money. Whether

that's lending it out to two borrowers. But because of all of the money that we that Americans in general are flush with, they don't need any more money. They've got all the money that they need are stocked, yes, and that's why basically they aren't at the moment at least offering higher interest rates, although we might see that start to take up a little bit, especially with the more competitive online banks. But we should also mention that it makes sense for some folks to do a student

loan refinance these days. We know that you still don't have to pay on those loans right now, but those payments are set to resume in just over a month, and if you can afford to pay on those loans and you don't qualify for loan forgiveness, now could be the perfect time to refinance while the rates are are still near all time lows. But remember refinancing it's not

for everyone. The federal loans that are out there have some additional protections for borrowers, including uh income based repayment. Were you to refinance, you would be giving up some of those perks, some of those benefits of federal loans. But will make sure to link to an article that explains all the different things that you need to consider. Will link to that article in our show notes as well. Yeah,

for sure, and and that article hopefully. Yeah, we'll walk you through if you're like, I'm not sure if I'm the kindniverse who should be doing this for you, find it'll help you decide whether or not it's for you. Alright, let's talk about streaming for a second match. And over the past decade, I would say we've all gotten used to the fact that virtually all of the television we

watch is now delivered via streaming services. Live sports is one of the exceptions, although that is moving via Hulu Plus Live whatever, Amazon Primes getting Friday night baseball games and stuff like that. So really, yeah, you follow the baseball more closely than I do. Yeah, but we've seen you know, like Thursday night football on Amazon Prime before and stuff like that, so we're gonna see more and

more of that. But but also, yeah, we've gotten used to the experience that we no longer have to put up with commercials, and I think a lot of us have been thrilled with that. Right now that we're we're hooked on ad free streaming, though the different providers out there there, you know, gently pulling the rug out from under us. Commercials are basically on the comeback trail, and you can get a discount for opting to watch commercials

while streaming. It's so Disney plus Is actually has announced their planning to offer a discounted plan that includes commercials later on this year. You know, you'll say five bucks a month right now if you out for commercials on HBO max is streaming service. Hulu has been doing this for years. That's basically how they started, and then they started to allow people to pay extra to opt out of commercials. So I guess, um, yeah, my question is is it worth it to opt out of commercials? I

guess it depends right on how much you just like them? Um, but yeah, if you don't mind a commercial here and there, then it could mean saving a few bucks each month, and it really yeah, just kind of coming down to the agel question of how much your time is worth. I think as long as there are options for folks, if all the different you know, streaming services chose to, guess what, now, no matter what, you've got to watch commercials, that would be a massive mistake, right, Like you've got

to give people the option. As long as folks have a choice, I think a lot of individuals are going to be happy with that. You know, I can't imagine going back to the time when you're sitting there watching a thirty minute episode of Friends or something like that, and really there's only like twenty one minutes of actual of actual show that you're watching. Two thirds of the time was actual show? Con seriously exactly? Yeah, So keep that in my uh, Netflix executives and whoever else listens

to the show. Because on that note, the reason we mentioned Netflix is because they're actually getting tired of you using your ex boyfriends roommates password to watch Britain uh to survive Formula one series, which is fascinating. But we mentioned this because Netflix is cracking down on password sharing. Uh. This is it's being tested first in some other countries where they are basically they're prompting their subscribers to pay a few extra dollars like a fee for additional folks

who stream on your account. The Peruvians and the Chileans, they're there, the guinea pigs out there, but the writing seems to be on the wall. Uh. If you are sharing a Netflix plan with a friend or another even another family altogether. I guess there there's a good chance that that behavior might cost you more in the future. Yeah, And we're just seeing more competition in the streaming space

in general. We've been living in the golden age of television, like literally, yeah exactly, I mean, is there ever gonna be a time where there's more good stuff to watch? Literally the past decade? Like we have been in this period of time when it's it's like all the different streaming services have been in an arms race essentially, right, trying to grow their subscribers, growing to subscribers, and they're

increasing the kind of content that they're putting out. But now it's getting a little more cutthroat, and they're saying they're realizing, oh, in order for us to create the you know this amazing content, we gotta we gotta make some more money. And how many movies and TV shows is Netflix putting out in a giving year. It's astronomical, right, Like you you couldn't watch it at all. It's almost

like YouTube levels of content on Netflix these days. So I get it, um, And that's and they're doing that globally, right, Like I mean, like there is content being created in different countries that we can't even get our hands on it, right, all right, So yeah, just remember that and and we'll keep you up to speed if that new Netflix practice of cracking down and passwords comes to the US. Let's talk about housing for a second map, because the housing

market it's still suffering from a lack of supply. Right. Prices are through the roof, which has been frustrating anyone who's trying to buy a home. Specifically, I feel bad for first time homebuyers. Some of our friends, like their house went for almost a hundred and fifty thollars able list price. It's crazy town for almost like a starter home. It's like it's a three to Yeah, it's mind blowing bonkers.

So I feel for everybody out there who's trying to buy a house because it's really really hard, and you know, our price is going to chill out in the near future. That's anyone's guess. It depends on a whole lot of things. But yeah, if you're out there making offers, just wanted to note that personalization can actually be kind of helpful when you're making your pitch. Um. The Wall Street Journal had an article about how folks are winning in this

bidding war environment. Some are offering free concert tickets or to pay for a vacation for the seller in order to stand out someone else, like owned a restaurant, they were like, fift off my restaurant for a whole year for life. I mean, those are the kind of thing lengths that people are going to to try to score

the home that they want. And I think it's pretty cool, right, But I gotta say, honestly, sometimes a personalized letter about what you love about the house, about the neighborhood, maybe how much it would mean to your family, why you want to live there, why you love their house in particular. Those kinds of of letters don't cost anything, and they

can be really persuasive. Like I'm thinking, if I was trying to sell my home, that would go a long way and I would potentially be willing to take you know, the not the highest offer. If you talk in my heartstrnks when I read it, you know, if it made me happy to this person will be taking over the reins living in the house that I loved. So I don't know, I always think that's a good tactic. It's one worth considering. Those are all important things to keep

in mind. But you know, one thing that you don't want to do to stand out is to wave your inspection. Evidently, twenty one percent of folks are actually doing that right now, according to real estate website Redfinn. We're not cool with that unless you know a lot, a whole lot about houses, or if you can bring someone who does to the

showing with you. Some folks are literally hiring inspectors to come tour the homes with them so that they can waive the inspection when they make their offer, which is pretty brilliant. This is one of the ways to kind of secure the deal and make that happened, but without

putting yourself at a new risk. Exactly like you are still covering your bases because I know it can be tempting to waive those different contingencies when you've been you know, you might maybe even stymied in your home buying attempts, but buying a multi hundred thousand dollar lemon or money pit is something that you want to avoid at all costs.

And it might be over a million dollar lemon because I don't know if stats recently came out, Matt, guess what percentage of homes now cost over a million dollars in the US. I think it used to be like two percent. Now it's like eight or two. It's like almost nine percent. Homes cost over a million dollars, which I was surprised to see. But it's they're also all out in California. That's true. Um of those are in California. But I couldn't imagine. It's just a different way of living.

It is there. It is, Yeah, a million dollars for you know, to one out there in some places. All well, we've got more information that we've we've got to share with you on today's Friday flight, including a story about thieves targeting your car. We'll get to that and more right after this break. All right, we're back from the break, Joel, let's continue with our Friday flight. You are you willing to introduce our ludicrous headline of the week. I'll do it.

I got this Bunny and uh listener Gary actually sent this one over which we you know what, I just want to say. If anybody comes across some sort of ludicrous financial headline this week, feel free to email us. Let us know. We love hearing suggestions from listeners, And no matter what, we always like hearing from from listeners, whether it's you sending in your voice memo to share what cool tip you've implemented in your life that was another quick plug for the episode, or if it's a

ludicrous headline, either way, we love it. Yeah for sure. Right so this this headline was tom Brady unretired and disappoints unlucky fan, and and everybody heard about this by now. It was the unretirement that you know, went around the world, and I don't think anyone was terribly shocked. So I'm actually surprised when he said he was retiring. I was like,

I don't know if that's gonna stick. But yeah, you would think all Tom Brady fans would be pumped that he's coming back for another season, right, well, just about all of them, not the anonymous guy or gal who paid more than half a million dollars for Tom Brady's last touchdown football. I would say that this football, Matt is almost certainly worth a good bit less now that it's just another random football that Tom Brady through and um, it's it's a good idea if you're buying something like

this that that feels sentimental. There's there's so much going on in the space of collectibles that I would say a lot of people are gonna lose money in this space. If you think about it as an investment, you are are likely to get burned. When you're buying some sort of sports memorabilia or playing cards. Um, you have no idea whether that asset is going to go up or down in price, and I think this unlucky bidder is is going to find that out pretty quickly. I completely agree.

You definitely can't look at some of these different items as an actual investment. But that being said, I would be willing to say that I think that that specific football that it will maintain its value because of the fact that, like, there's still takes from Matt Well, there's still a story associated with the football, right, Like there there's no inherent value of that football except for the fact that it was whatever the last ball that Tom

Brady tossed or whatever. But the fact is, it's not like this after he deflated it, Oh ma'am, I was kidding. It's not like that the story completely evaporated though, right It's it's not like it all of a sudden does not exist anymore. It's just that the story has changed and and so like in my mind, so before it was the football, it was you know, the last winning touchdown past that he threw whatever. Now it's the football that he threw before he fake retired. Like there is

still a story surrounding it. And like I might even be willing to say that it might even be worth slightly more because of the fact that we're talking about it right now. Not that not that you know, we're pumping it up or anything like that, but just because it's going around the internet, it's becoming like a legend. It's a basically it's a meme, right Like, like that

is why memestocks or a thing. It's not because necessarily of the inherent value of that thing, but rather it has more to do with the story and the lore surrounding the item. Uh. And so that's why I will to say that it's going to maintain its value or we might even see a go weapon value. This might just be a short term, twenty four hour new cycle story. So I don't know, we'll see, we'll see, But um,

it's still funny. I appreciate your take, and it's still kind of funny, and yeah, I'm sure that was their immediate reaction where they're just like, wait, he just came out of retire retirement, son of a Well, speaking of speculative assets, I think there's a story in the Financial Times that we should talk about because, you know, even a good story, like you're talking about this this football has kind of a story associated with it, maybe that

will lead to actually an increase in value. Well, even a good story can't can't prevent speculators from getting crushed right now as n f T prices are are getting hammered. And yeah, basically the speculative frenzy in that space seems to be over or or at least in a lull

for the time being. In the Financial Times reports that since November and kind of the peaks of the n f T market, the average price of n f T s for sale has declined by almost And so I don't similar to that Tom Brady football, right, Like, I sure hope you bought digital art for sentimental reasons because you really liked the way it looked and you wanted to incorporate it into your life in some way former fashion, not just because you're trying to score a quick buck,

because a lot of people have seen the value of some of those digital assets that they thought we're going to continue going up in value exponentially, just plumb it back down to earth and if some of them have become, you know, almost worthless. That's right, man. Here's another story that it actually could have been our ludicrous headline of the week. But it's all about the massive uptick in catalytic converter theft in addition to the of course, terrible,

terrible loss of life in Ukraine. We are continuing to see the relatively minor impacts of the war here in the US, and so to that, Like many of us have heard about the impact that the war is going to have on wheat production, but who knew that Ukraine also accounted fort of global palladium production. Not me. I didn't know that until I saw the story. Uh. It turns out that palladium is a valuable metal when it

comes to manufacturing catalytic converters, which all cars have. Uh, And they're getting stolen off of cars, they're getting sold to metal scrappers since the prices of palladium has skyrocketed since the start of the war. So we wanted to mention that story because your catalytic converter, it is at risk. So we've got a couple of tips for you. First of all, keep your car parked in the garage at night. Uh if you are lucky enough to have a garage, you don't have those in the city most of us.

Most folks don't. But you know, if you've got one of those garages that is full of a bunch of stuff, we would recommend for you this is a great time to clear all that crap out of there. Listed on Facebook, market place or donate it. But you want to clear out all that junk and make room because it could save you thousands of dollars plus all the headache of having your catalytic converter saw it off like in some cases, I mean they're cutting other wires and stuff like that too.

So not only is it just like the cost of a catalytic converter, but there's all sorts of damage that is happening to vehicles. Might have to get your car towed, Additional damage could be had. You gotta protect yourself from these thieves. And if you don't have a garage, park in a well lit spot like Matt we we have a side street that's pretty dark at night. We've been parking on the front in front of our house now because there is a street like directly above our gardens

brand new Georgia power LEDs exactly. And so it's like, all right, yeah, at least that the places, you know, one more hurdle in the thieves way, So do whatever you can to protect your car, because yeah, cattle like converter theft is on the rise, and it's something else, Matt like, gas prices continue to remain extremely high, right which is only spurring more and more folks to be interested in electric vehicles. Of course, they're as Hansel was

in Zoom later. They're so hot right now. And uh, someone in our Facebook group who lives in California posted picks of basically seven dollar a gallon gas and and they're asking about buying a new electric vehicle. They were like,

does it make sense for me? And you know, we hesitate to tell someone to go buy a new car, even though gas prices have gone insane, but we are fans of electric vehicles already from a gas savings perspective, from a less maintenance perspective, like they are the cars of the future and they can save you money now.

But yeah, before you head to the new car lot and you start test driving Tesla's or Chevy Bolts or the new Ford Mustang whatever it is, you should really look hard at the numbers on how much you are spending on gas each month, because if you're a heavy driver in a state where gas is more expensive and EV purchase could pay off in the long run. But don't let the current gas prices being excused to make

a poor financial decision. And Matt, you remember, I don't know, not not terribly long ago, we had a listener who drives a ton for work, and and he was thinking about buying one of those expensive electric trucks, and um, it was it was. It cost some pretty penny, But he drives so much and he lives in a state where gas costs so much that for him it was actually a no brainer. But for for most people, they have to actually run the numbers to decide whether an

electric vehicle makes sense for them or not. So much of it depends on you know, your driving habits, that's right. It's also important to think about used electric vehicles as well, because you know, like older and needs on leaves, for instance, they have plummeted in value as better looking electric vehicles with big, bigger battery packs and better range at the market. But often for an unloved older you know, electric vehicle like that could be just the ticket to meaningful savings

at the pump for you. Of course, those needs on leaves that they have much inferior range. Of course, I get the desire to own an electric vehicle that can do two fifty plus miles on a single charge. But if an EV with lesser range, if that works for you and your lifestyle and how you drive, it can be well worth considering. Yeah, I think that's gonna be

the sweet spot for a lot of folks. Although with huge car prices haven't gone up, and I'm sure those huge dvs are gonna cost more and more, cost more, right now, that's exactly the unfortunate truth. But you know, if you run the numbers buying like a ten fift dollar used electric vehicle, if it, you know, if you're a daily commuter, it could massively curb your gas consumption. It could pay for itself. But Matt, let's let's get

you another story about buy now, pay later. We've talked about that a bunch, and it kind of continues to be the rage despite how we feel about it. Everyone is doing it now, everyone's getting on board. Delta Airlines just jumped on the bandwagon to there. Now, I'm giving folks the ability to pay for their air fare just like you can pay for a new clothing item on

your favorite retailer's website in multiple installments. And uh yeah, we won't belabor the point because if you've been listening to the show for any amount of time, you know our stance by now pay later gives folks a false sense that they're saving money basically by just extending the payment period out and um yeah, it allows a lot of folks who really can't afford an item right to

buy it anyway. And so if you're trying to get out of debt or save more money, by now pay later is not going to help you do that, and in fact, it might lead you into a worse financial predicament, having more monthly payments than you actually should have. And so yeah, you're seeing that option more and more when you're checking out across the web, even when you're buying airfare, and it's best, we would say, just to avoid buy now,

pay later altogether. That's right, man. And we have one last story, a credit reporting story, because the CFPB, the Consumer Financial Protection Bureau, they're looking to get medical debts off of credit reports. At least that's what it's looking like. It turns out that more than half of debt that's gone to collections that in one way or the other,

it stems from a medical procedure. Um. You know, there's the medical bills on your report are essentially they're gumming up millions of consumer credit scores, leading to a real inability to get a loan or to rent an apartment, and it's leading to higher interest rates on car and home loans. Medical debt, it's certainly different than credit card debts because most medical debt occurs because of an emergency. Right, it's involuntary. It's not necessarily something that you have chosen

to do like you would with a consumer purchase. I can't wait for my explain to rupturepital. That exactly what I want. Nobody is saying that, uh, and so I think that it could make sense for the bureaus to treat it differently. That being said, it is treated a little bit differently. Credit bureaus. They've told collection agencies to

wait roughly six months before reporting any unpaid or delinquent bills. Essentially, whereas with a credit like if you miss a payment on a credit card, you see that hit your credit port like literally the next building cycle, that the very next month, and so it is treated a little bit differently. It'll be interesting to see what the CFPP does, and we'll report back if they end up changing the guidelines on this. Personally, I don't necessarily see this as the

perfect solution. I mean, medical billing obviously it's broken, right, it's it's broken, it's or at the very least, it's very complex. But saying to credit bureaus that, hey, you can't report on this at all, This isn't something that you're allowed to share with lenders who are trying to look at an individual's overall financial history. Like the report shows half of all debt stems somehow from medical procedures. How are we going to like essentially ignore that much

medical debts. I don't see this being the best solution. I totally agree with what you're saying. You you actually use the word and I think you're right. The first time you said that the system is kind of broken, and I think you're right. I think the medical billing system is broken. The credit scoring system is kind of broken. Um. And that actually has a massive impact on all of

our personal finances. And in one of the best ways to approachest sadly, you have to get informed on the health care link front, and you have to learn how to combat the high price of healthcare in your life. And so, um, I wishally did a whole episode on that mat with Marshall Allen episode four oh nine. So if you end up with a bill that you can't pay, or even a bill that you think is unfair, there are ways to fight back, um and and so yeah,

we would encourage everyone. That's one of my favorite episodes that we've done, episode four oh nine with Marshall Allen. And yeah, it impacts a whole lot of people in this country. Um, they need his information, the information that he's sharing. By the way, speaking of credit mat, we're we're actually gonna demystify some myths about credit scores next week on the show. Yeah, folks should get ready for that on Wednesday, that's right. So we hope everyone has

a great weekend. We've got an ask how the Money episode lined up for you? This coming Monday. We'll have links to all the different stories and some of the different resources we mentioned up on the website at how to money dot com and Joel. Until next time, Best Friends Out, Best Friends Out the umber Bo