April 18, 2025 • 33 mins
Time for a Friday Flight- our little sampling of the week’s financial news and what it means for your personal finances. There are a lot of headlines out there, but we boil them down to specific takeaways that will allow you to kick off the weekend informed and help you to get ahead with your money. In this episode we explain some relevant and helpful stories like: Elon stickers, panic pre-purchasing, used car prices ticking up, tariff surcharges, make used great again, untrustworthy TikTok trends, buying vs being dupes, fatter E-funds, fearing overdraft fees, “recession hair”, overpriced 8k, predictable phone pricing, and Coachella with interest.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to How to Money. I'm Joel Matt. Today we're
talking panic, pre buying, untrustworthy TikTok trends, and recession hair.
Speaker 2 (00:27):
Riscent Do I.
Speaker 3 (00:28):
Always have recession? Here? Joe? How's my hair look right now?
Speaker 1 (00:30):
It looks a little recession, not because you're but just.
Speaker 3 (00:35):
Part of entering into middle age. But friend, this is
our Friday flight. This is our quick sampling of the
different headlines that we came across this week and how
they're going to impact your personal finances. By the way,
stay tuned. On Monday, we're going to be talking about
I mean, within this Friday flight, we're talking about terrorists
to a certain extent, but I can't avoid it. Yeah,
on Monday's episode, we actually have a special ask How
to Money episode lined up for you, specifically addressing a
(00:58):
whole lot of tariff concerns.
Speaker 1 (01:00):
Folks have a lot of listener questions to look forward
to that people sent in because of course, they are
going to impact our lives in so many ways, depending
on what form they fully realize themselves. But yeah, so
people had a lot of questions about that. We try
to tackle as many as we could and looking forward
to Yeah, sharing that one with you guys on Monday.
Speaker 3 (01:17):
So you know what I've been seeing around town lately, Joel,
Not only on the interest. I feel like I've seen
them most of the time on the interstate, but even
this morning, as I was biking into our studio, I
see a Tesla past me and it's got the sticker.
You know what I'm gonna say, It's got the h
I about this before you went crazy sticker on there.
You've seen those, right, I've seen those. Yeah.
Speaker 1 (01:37):
What I found interesting though, I read about the guy
who started a company selling these elon stickers. Apparently it
makes like one hundred thousand dollars a month now selling
these stickers. Now, oh my gosh, it's capitalism at its finest.
Speaker 2 (01:49):
Man.
Speaker 1 (01:50):
Hey, if you guys and I get it too. As
a Tesla driver, you might want to signal, especially with
the violence that's being done to Tesla.
Speaker 3 (01:58):
What do you think about the signal? Get it?
Speaker 2 (01:59):
Because you for someone.
Speaker 1 (02:00):
To come up and a cost you for driving to Tesla.
They think maybe a political stance, but.
Speaker 3 (02:06):
Yeah, for most people's it's a product that someone has purchased,
like this is not a political statement. How did Tesla's
go from being a statement of like I'm trying to
help save the earth and I'm trying to be green,
or maybe I just like to drive a car that's
got an amazing amount of instant torque. So thinking that
this is, you know, a political statement, I think you
(02:27):
know how it happened. But I think most people are
less aware or care less about the political side of things,
and they're just trying to drive a car.
Speaker 2 (02:34):
That they like.
Speaker 3 (02:35):
I guess I get it. It's certainly how much of
the stickers. How much do they cost?
Speaker 1 (02:39):
I don't know, but apparently five bucks or something. Yeah,
apparently there's enough profit margin for this guy. The guys
I can get ton of money.
Speaker 3 (02:44):
It's a cheap form of insurance, right, Like, Yeah, if
you are trying to keep folks from kying your car
or slashing your tires, even lighting your car on fire, right,
I certainly, I certainly understand.
Speaker 2 (02:55):
It's just sad that you would have to do that.
Speaker 3 (02:56):
I think it probably depends on where you live, too, right,
because if you are living an environment where maybe it's
a bit more progressive or left leaning, and you're driving
a Tesla around, you're getting that bombastics? Is it? Bombastic?
Side eye is that what the kids are saying.
Speaker 1 (03:08):
But then again, that's where a lot of those teslas reside.
Think about like per capital, there's more teslas in California
than there are in like maybe more red leading states.
Speaker 3 (03:16):
So fascinating to see if it truly does become a
political statement if folks who are more right leaning tend
to tend to buy buy vehicles. But speaking of vehicles, actually,
did you see last month that retail car sales increased
by almost five percents While we're talking about cars here, Yeah,
that's not just evs but just new vehicles across the
board shot up in anticipation for the upcoming.
Speaker 2 (03:39):
Terrorists, a little bit of that pre buying action.
Speaker 3 (03:40):
At this point, Americans are expecting higher levels of inflation
than they have in like something close to thirty four years,
which can lead to pre buying. It can lead to
this self fulfilling prophecy of sorts.
Speaker 1 (03:52):
Because yeah, if you think prices are going to go up,
you're more likely to buy more now, sure, because you
don't want to pay the higher price tag later.
Speaker 3 (03:59):
I get the impulse, and I think it can make
sense if essentially you're kind of pulling some of that
purchasing forward, right if it's an item that you were
already planning on buying. But this is also hard to
gauge because tariff levels are constantly changing. If there's anything
that we've learned, it's that which is not normal tariff policy,
but it is the new normal. Like if you bought
an iPhone that perhaps you didn't need, well, you might
(04:19):
be kicking yourself because they were exempted from the terraff.
Consumer spending at Apple was up twenty percent in the
first week of April before that carve out, before that
reprieve was granted. Shelf stable foods have even been purchased
at higher levels as well. I think some folks. There's
reports of some folks stocking up on Christmas items as
they're looking ahead, because think about all the plastic that
(04:41):
comes from It's not just plastic, but when we.
Speaker 1 (04:43):
Buy most of our toys from China, and if there
is one hundred and forty five percent tariff that remains
on those Chinese goods that come overseas, yeah, Christmas is
going to get a heck of a lot more expensive
and companies, American companies aren't going to be able to
shift on a dime. And source those toys elsewhere. So
I that's true. I get some of that impulse, and
we don't know how this is going to shake out ultimately.
(05:05):
I will say the silver lining to buying your Christmas
presents early maybe you do get a better deal, but
also you don't have to worry about Christmas shopping later on.
Speaker 2 (05:11):
I mean that sounds kind of nice.
Speaker 3 (05:12):
Until Christmas rolls around. It's just like, oh, yeah, I'm
not interested in that hobby at all anymore. You're well, sorry.
Speaker 2 (05:18):
Tariffs mom, that was just six months ago. Like you're
totally gonna disappoint your kids.
Speaker 1 (05:22):
Yeah, well, so interesting to see the knock on effects, right,
and the kind of domino impact of tariffs and so like.
Used car prices have actually gone up for the first
time in two and a half years because of tariffs.
Speaker 3 (05:33):
Which we thought that the pandemic was going to be
the last time we ever saw used car prices go
up because of the snarled supply chain, right right, Like
that's why, like everybody was looking to us and we're like,
this is a one time blip.
Speaker 2 (05:45):
That was an anomaly.
Speaker 3 (05:46):
Here we go, Yep, yep, another anomaly.
Speaker 1 (05:48):
Another anomaly again in short order, because the supply chain
of new cars is being threatened by higher prices. It's
leading to less supply that pre buying we're talking about,
and then higher prices on on used cars as more
people turned to that market to get what they need.
Speaker 3 (06:04):
Trump is now the ever grand that's stuck sideways those.
Speaker 2 (06:09):
Yes, the Pandama Canal.
Speaker 3 (06:13):
Yeah, yeah, actually it's not. Well, yeah, luckily the Panama
Canal has not entered into the equation. I guess recruiting
changed on that one yet. Oh man, well, so this
is less I think of capitalizing on a sale and
more like buying now because of looming threats. Right, this
is what people are doing. And I think it's okay
to purchase some items ahead of time, but in these
uncertain economic times, man, I think it's also important to
(06:35):
note that cash is important. Right when you're not sure
what's going to happen with pricing, and maybe when you're
unsure what's going to happen with your income. Most folks
just can't afford to stockpile or buy significant amounts of
items ahead of time, particularly those more expensive items. Like
I was going to get an iPhone next year, I
might get it now. Well that's that's like a thousand bucks, right,
and most people just can't afford to do that in
(06:57):
anticipation of saving twelve hundred bucks a year from now.
I think, more than anything, that we want to communicate
to people is just not don't buy stuff that you
don't need just because you're worried about price increases, because those,
as we've seen, are nearly impossible to predict, and it's
hard to know where tariffs go from here. And I
get the anxiety that people are feeling, but I also think, well,
(07:20):
spending more of your money and having less less of
a cash reserve is it necessarily the right way to
approach this, and that could lead to even more anxiety
and potential hartburn later on. People got to have their stuff. Yeah,
I think that's the mentality. Hey, let's talk about pandemic
throwbacks for a second longer here. Remember the restaurant search
charges back during COVID. Oh yeah, the was it like
(07:41):
a specifically for PPE the protective that's right, was what
do I even stay for personal protection equipment or some
something like that.
Speaker 1 (07:49):
And I think people didn't mind it in the moment,
but the longer those tariffs surcharges lingered on restaurant bills.
That's when people started to get.
Speaker 3 (07:56):
Yeah, yeah, yeah, it's just like, isn't the government sending
out like free tests and their masks everywhere now like
early again, everyone gets a buy early on when we
had no idea what was going on. But yeah, it
didn't take very long before I at least was annoyed
at some of the search charges that we're seeing specifically
at restaurants. Well, on that note, more companies are now
(08:16):
imposing tariff surcharges, so instead of jacking out their prices,
they're finding a way to communicate and to let their
customers know that, hey, the government policy is to blame
here for this bigger bill. And depending on where different
companies are sourcing their products from, depending on how quickly
they're able to pivot, it won't just be a tariff
(08:37):
surcharge that you're seeing, but actual higher base prices as well.
Companies out there, particularly particularly the small and medium sized ones,
they're in a tough spot, you know, they're kind of
stuck between a rock and a hard place. They're trying
to figure out how to proceed, and while there is
a whole lot of uncertainty now, I think it's again
sort of like early on during the pandemic, let's just
(08:59):
kind of be kind to everyone, to all businesses as
they in particular are trying to figure out how to
proceed and how to stay solvent. Yeah. Especially Yeah.
Speaker 1 (09:08):
I talked to someone the other day and they have
a side business and they buy cookwear from China, and
they just canceled a large order because they were like, well,
we can't. We don't know if we can be profitable
right with this tariff in place, and so right now,
like this business is on hold. And I think there's
a lot of people that are in a situation like that.
(09:29):
And for businesses that can't afford to do that, they
still have a product they have to get to their customers,
and they don't want to want it to look like
their prices are jumping dramatically, and they want to communicate.
Like you said, Matt, hey, this is the reality we're
all living in right now. Here's how much more it
is costing. Here's why I'm passing on this higher cost.
I think it makes more sense than maybe some of
the long lasting restaurants surcharges we saw, sure, but I
(09:53):
would say use this maybe as an excuse as an
individual consumer to start buying secondhand right because tariffs and
then the threat of more widespread tears, particularly on the
countries that manufacture so many of our clothes, They've been
great for thrift stores. People are shopping at thrift stores
more often. You and I were like, Hey, no matter
what's happened to the economy, shop at your local thrift
store anyway. So it's not just that folks are trying
(10:15):
to avoid paying more for their garments. They're just also
worried about more lean economic times coming about and downturns. Man,
what happens in a downturn always is barket basement options.
They tend to see a whole lot more traffic. And
it's also interesting, when the economy is booming, people save less.
When the economy is tightening, people tend to save more.
(10:36):
It's like the opposite reaction you would assume. And we're
already keen on places like Facebook, Marketplace. We like yard sales, Matt.
I know you like freebies on the curb too, that's
kind of your jam curb alerts. Yeah, but don't forget
about like goodwill and then just making do with less.
And I think I might sound odd, but I don't
think of these shifts in shopping as like a negative thing. Really,
(10:59):
what you're doing as you're making smart changes to stretch
your money. I don't think there's any shame in that.
And I think actually, like I wear my awesome Goodwill
finds with a badge of honor, I think it's instead
of a status symbol being a fancy car, it's the
cool shirt I found that nobody else has because it's
one of a kind because I got it from the good.
Speaker 3 (11:15):
Will, or the shirt's one of a kind because it's
got holes in it, which is literally I'm gonna turn
around here. Can you see my back?
Speaker 2 (11:24):
Oh yeah, that's that's a big hole, large hole.
Speaker 3 (11:27):
You know what. I like this pocket tea and I
was like this close to.
Speaker 1 (11:30):
Talk to your recession hair. Combined with the holes in
your shirt, people are probably worried about your buddy.
Speaker 3 (11:34):
We will get to that one here in a little bit,
but let's talk about a recent TikTok trend that has
been gathering steam. There have been videos from influencers online.
Maybe you've even seen some of these influencers because you
follow them, but they are claiming that luxury handbags or
Lulu Lemon leggings that are being made in China that
you yourself can in fact have them for a steal by
buying directly from these Chinese manufacturers. Why it sounds enticing
(11:57):
cut off the middle man? Yes, why would you be
h be willing to pay burbery prices when you can
get that same luxury item for pennies on the dollar
jewel and it sounds pretty cool. That's not necessarily true.
A decent chunk of high end luxury products are actually
made in France and Italy. They're not made in these
Chinese factories. The vast majority of Gucci items, for instance,
(12:19):
are made in Italy, the same with Louis Vuitton. Some
even make products in the US. That experiment actually hasn't
gone well. There's been reports of trying to train up
US workers to make leather handbags and it's like, oh, yeah,
they're really bad at doing that.
Speaker 2 (12:36):
The artisans in Europe are better than this.
Speaker 3 (12:37):
It's taking years and all they're doing is just like
a minimal leather pocket or something like that on a handbag.
It's actually pretty funny, but many luxury items are actually
manufactured in China and then shipped elsewhere to be quote
unquote finished. So if you opt to go this route,
it reminds me of buying on the streets of New
York Jowel. There is a reasonable chance that the allure
(13:01):
of trying to snag some of these luxury atoms for cheap, well,
in fact, you're gonna get a knockoff product. You're not
getting a crazy deal because you bought direct. You're buying
you're buying a fake product.
Speaker 2 (13:10):
Have you ever.
Speaker 3 (13:11):
Specifically gone up to New York and gone to Canal Street.
Speaker 1 (13:13):
Oh, for sure, going in high school and we called
them folk LEAs because Oakley's were very cool back then,
and you would buy a pair of Focles.
Speaker 2 (13:20):
You knew what you were getting.
Speaker 1 (13:21):
I mean, you knew they were eight dollars for a reason,
not because they were real Oakley's that had been cut
out the middleman. It was because they were a knockoff
that was much cheaper. I think that there's a certain
sort of badge of honor in getting certain fake items.
Like the first time I went to New York, I
drove up there in my jeep with my buddy Kyle. Actually,
so we didn't drive to New York. We drove to
Poughkeepsi and took a train from Poughkeepsi to New York.
(13:44):
It was the opposite of the something Corporate song.
Speaker 3 (13:47):
We didn't wake up in the car, but we specifically,
of course you're wanting to do, like hit all the
highlights in New York City. And I can't remember what
kind of watch it was. I think it was like
a Brightling, but of course I knew I was getting
a fake. I think it was like Prightling or something
like that. I don't know, but I like the hands
on the face of the dial right, like they fell
off in like a year, but like I knew that
was going to happen. But it's also that's part of
(14:09):
the allure.
Speaker 1 (14:10):
Yeah, exactly. I mean it's like a fraction of the price.
It's interesting to see these these like people literally who
work in some of these Chinese Chinese factories trying to
reach out directly to American consumers and say, hey, skip
the name brands, we have something very similar or or
they're basically making it sound like it's the exact same,
but you can get it directly from them for a
lot less. And there are there are Yeah, and obviously
(14:33):
we know that a lot of luxury items are kind
of handmade, and they are more expensive for a reason.
But then other luxury companies use manufacturers in China and
in India, right, and then sometimes they'll finish the item
in Europe so they can say that it's made in
Italy because Yeah, for some reason, consumers don't value items
made in China as much as they do as something
that at least seems like it's handcrafted in Europe. Fully,
(14:56):
this reminds me of dupes too, which we've talked about
on the show. Yeah, some folks pursue who dupes passionately.
You know, people want the vibe without forking over the
big Bucks. Walmart, for instance, had the fake burkin bag.
The working that's sold out incredibly quickly, and then people
were reselling on eBay for ridiculous sums of money.
Speaker 3 (15:13):
Working bag. Yeah, but you.
Speaker 1 (15:15):
Know, for like the real air Mas burken bag, those
are made by individual artisans, like with a single piece
of leather, right, and I think they're handstitched by a
single artisan. They sell for many, many thousands of dollars
if you can even get one. I've got no problem
with people buying luxury items. I don't partake. I don't
care about luxury goods, but and I don't care about
(15:37):
attempts to mimic those goods and create something that is similar,
even if it's lower quality. Just don't think that you're
getting a real Louis Vuitton handbag for five bucks or
something like that. I mean, there's this one video where
this lady is like showing these persons. She's like two dollars,
two dollars, two dollars. It's just not going to be
the same thing. It's not gonna be the same quality.
Speaker 3 (15:54):
Nope.
Speaker 1 (15:54):
And most luxury goods, of course we all know this.
They're an attempt at signaling wealth. But if you spend
a lot of money on luxury stuff, it has the
opposite impact.
Speaker 2 (16:03):
You're draining your.
Speaker 1 (16:04):
Bank account to signal wealth that you no longer have.
And I think there are always exceptions, there are ways
to get something similar in this kind of wild West
consumer environment that we live in. But you got to
do your due diligence, and you got to realize that
the thing that's being sold to you for five bucks
is not the same thing as being sold to you
for fifteen hundred, and hey, maybe you don't need either that's.
Speaker 3 (16:24):
Right, man, But we've got more to get to. We
got more personal finance stories to get to. We're going
to talk about the CFPB, We're going to talk about Coachella.
What other show is going to talk about both the
CFPB and Coachella in the same podcast. So we got
that more right after this. All right, Matt, we're back.
Speaker 1 (16:47):
We got more money saving information we got to get
to on this episode. This is, of course, time for
the ludicrous headline of the week. This one comes from MarketWatch.
The headline reads, experts now recommend a twelve month emergency fund.
And I hate to do this, Matt. I don't want
to throw a good, a well intentioned person under the bus.
Speaker 3 (17:07):
Here. You're gonna throw me under the bus. I like
twelve month emergency funds. I'm not. I just think. Okay.
Speaker 1 (17:12):
So this was a specific recommendation of a former guest
for Meat Safety, and we've had him on before, we
like Reramiet. But he's been making the rounds. He's now
telling folks that the twelve months is the emergency fund
they need now. And I think there's a difference Matt
versus telling people, Hey, if you really want to save
up to twelve months more power to you go for it. Yeah,
I get the impulse to tell people to save more.
(17:35):
I like savings too, and I have a larger than
six month emergency fund personally. But I think also this
is moving the goalposts on people. When you've told people
for so long, hey, you need three to six months
worth of savings, which, by the way, most people don't
have any work close to that. I'm sorry, But changing
the metrics and then telling everyone to quickly amass six
(17:56):
or nine months or more worth of expenses, it sounds
like a panic reaction to me. And so I get
the destabilizing effects of tariffs, the higher potential for a recession,
and really, you know, the stomach churning nature of bigger
market drops that we've seen. But either three to six
months of emergency money, either it's enough or it isn't.
(18:17):
And I don't think that changes. Like we know, the
whole reason of an emergency fund is to save four
potential tough times. Just because things have gotten a little
more squrely doesn't mean we need to change the prescription.
I think for potential teas.
Speaker 3 (18:30):
All right, I might disagree with you just a little
bit here. I might kind of side with re meat
because when things change, when like the facts on the
ground change, I think it's worth considering how much money
you've got in cash, set asided savings and so like.
For someone who's got three months, you know, I think
this might be a call to say, all right, hey,
maybe I should have like closer to fourty five or six,
(18:50):
or if you're somebody that has like nine, you're saying
forty five for months is a bit extreme, the full stop,
I'll put that out there. But I certainly hate what
seems like fear mongering though, Like, and that's the part
that kind of drives me crazy, is that if it
is like a knee jerk reaction to the headlines and
it's just like, oh man, you need to be doing this,
(19:12):
then certainly I don't I don't like that. But if
you are someone who believes that, and maybe you're somebody
your financial situation isn't super stable, maybe you're if you're
a one income household, if you're somebody who works for
a company that's looking to downsize significantly, I would have.
Speaker 1 (19:27):
Said you should have already been towards that six month
range and all the three Yeah.
Speaker 3 (19:30):
Yeah, absolutely, But then beyond that given the sortain uncertainty
that we've seen in the destabilization of our economy and
certain specific industries as well, I think it's if you
think that there are big changes coming, well, I think
it would not just be worth considering that advice, but
I think it would be wise and even prudent to
sort of follow your gut to what you as an
(19:52):
individual feel comfortable with, because I just don't want there
to be like a blanket prescription of like, no, you
shouldn't you shouldn't be doing that, because when you know,
folks batten down the hat, which is when they see
a storm coming, and I think that this could be
a way for folks to do that. I don't like
that personal finance in this way feels like it's getting
slightly political because a lot of times you see the
different headlines and it seems like it's just a reaction
(20:13):
to different publications that are trying to stir up a
whole lot of clicks and eyeballs.
Speaker 1 (20:18):
Basically, Yeah, So, I guess you as an individual can
determine how big your emergency fund should be and whether
you should be more worried right now increasing your savings,
and I think you make a good point, Matt. I
think it can make sense to reassess how much you
have in savings and how vulnerable you are to changes
right now. But I guess just a blanket prescription to
(20:40):
change how much you have in savings feels like a
little too much to me. And I think a lot
of people that the emergency fund they built up is
likely sufficient for most cases. And the truth is, too,
we can't prepare for everything. We cannot be fully prepared
for everything, and so it might mean missing out on
some of the investments that you would have made and
(21:00):
some of the tax advantaged accounts you would have stuck
money into. If you were to say, oh, wait, twelve
months is now the standard, I guess I got to
get their asap. And that could create other problems in
your financial life too.
Speaker 2 (21:13):
That's true, all right.
Speaker 1 (21:14):
While we're talking about savings and banks, should we worry
about overdraft fees?
Speaker 2 (21:19):
Coming back?
Speaker 3 (21:19):
Well?
Speaker 1 (21:20):
USA Today had a headline that said it's time to
worry about overdraft fees and they highlighted the demise of
the Consumer Financial Protection Bureau, which we've talked about on
the show. Speaking of negative headlines, yeah, I'm looking so hot,
right now, and they talked about the scrapping of the
proposed rule to bring overdraft fees down to five bucks
later this year. That was supposed to happen in October,
(21:42):
and now it ain't gonna happen. So yeah, some fear
mongering articles are being written about that. And yes, it's
true when you look at the numbers, overdraft fees have
become a lot more costly over the past decade. But
at the same time, there's also been a trend reversal
by some of our favorite online banks to eliminate those
fees altogether. So the disparity is is significant. Right, Even
(22:08):
for overdraft fees don't have a federally mandated cap you
as a person, you can still avoid them by doing
business with banks that don't charge them. So Capital One
discover ally CI all of those banks that we typically recommend,
they don't charge any sort of overdraft fee at all.
They've eliminated them all together.
Speaker 3 (22:29):
Those are the good ones.
Speaker 1 (22:30):
Yeah, Wells Fargo, what do they charge Matt per overdraft
infraction more than l thirty five bucks? That's ridiculous. Chase
so much money.
Speaker 3 (22:39):
Chase gives you a deal at thirty four per per
time you overt case that one dollar was going to
make a difference for you.
Speaker 2 (22:46):
Right there you go.
Speaker 1 (22:47):
And then the incredibly benevolent folks at Bank of America
they charge a much less offensive ten dollars per overdraft infraction.
That's still offensive in my book, but it's less offensive
I feel infinitely more than zero, right exactly. And so
I guess people might read this, and they might they
might be upset at the fact that banks aren't being
(23:08):
mandated to remove overdraft fees or reduce them significantly. And
I say, well, there's actually a lot of competition in
that space, and some awesome banks have made that part
of their marketing materials, kind of like Southwest did for
free check bags. No longer, sadly, but it's one of
those things that makes you stand out in this banking environment.
Go with a bank that doesn't charge over draft fees,
(23:29):
and hopefully you're paying enough attention to your finances too,
and you've got enough patting in there where over draft
fees aren't a problem.
Speaker 3 (23:34):
On the note of Southwest, what if them dropping the
free check bags is just a headfake and then they
bring it back, Oh my gosh, and that we've all
been played and it just engenders more love for them
because they're like, you know what, we listen to the people,
and we are a company for the people that would
be smart.
Speaker 1 (23:51):
When I would love that because well, I will say this,
I booked a trip for this fall, and I booked
before they stop the free check bag theme because this
is my backpacking trip. It's a really big bag I'm bringing,
and so I was glad to get in under that
free check bag wire. Yeah, let's keep going the word recession.
We've heard that being tossed around a whole lot more
(24:13):
right now. Understandably, we actually covered recessions in our latest newsletter, plug.
Speaker 2 (24:17):
For the Hada Money newsletter. Go sign up if you're.
Speaker 3 (24:18):
Not hoadamoney dot com forward slash newsletter, well Joel. In
times of greater uncertainty, frugality starts to become cool again,
ways to save more. They're starting to trend in ways
that they didn't when the economy was firing on all cylinders,
and that's where recession hair comes in. This appears to
be one of those where ladies they're waiting longer between
(24:40):
salam visits, they're letting their roots show or power to you. Ladies,
I'm all about that, letting their hair grow long and
going back to the natural color. I think the male
equivalent is certainly what I did during the pandemic, letting
the hair go really long or cutting it yourself. We
should post a picture of that for people you've got
to grow really long. I look significantly old older. That
was like double ear, man, it was. It was pretty crazy. Yeah,
(25:03):
you know, and I did the math. Because this kind
of behavior compounded over time, Joel, it makes the big
difference cutting over different. So the average the average dude's
haircut is thirty bucks and typically depends on who you are,
but most guys go to the barber anywhere between three
and six weeks. So I figured, all right, thirty bucks.
Let's say every month you do that for thirty years,
(25:25):
which is how long I've been cutting my own hair.
Now you're looking at over forty thousand dollars, man, compounded
in the market. Isn't that not insane? Just by this
one little thing that I do.
Speaker 1 (25:35):
Myself well, and a set of hair clippers once a
month us what thirty bucks? And with the additional because
you have some additional links that you have for the
top of your hair, so you don't have to use
scissors on it, because that's where things get a little
score at using scissors, where it.
Speaker 3 (25:49):
Gets a little dice.
Speaker 1 (25:50):
Yeah, And I know for for women it's different, I know,
and everyone has our different kind of fashion standard, but
they want to it's.
Speaker 3 (25:57):
Got their own craft beer equivalent.
Speaker 1 (25:58):
But I kind of like when people lean into this
stuff and they and they make it cool to be frugal,
because I think it just gives people the hall pass
to say, okay, cool, Yeah, I'm gonna jump in on that.
I'm not doing this. And it's similar to it's like
wearing that frugal that frugal change as a as a
badge of honor instead of being feeling like ashamed about
it or feeling like that cost cutting endeavor is somehow badly.
Speaker 2 (26:20):
Reflected on you for the whole world. That's right, Yeah, exactly.
Speaker 1 (26:23):
Well, and then say some other ways, we could say
Matt is not buying cutting edge technology, right.
Speaker 3 (26:29):
Well, I didn't realize this.
Speaker 2 (26:30):
Was a thing. I just saw that this week. Eight
k TVs. Did you know that was.
Speaker 3 (26:34):
These are like yeah, there, like the super fancy ones.
Speaker 1 (26:36):
Somehow I didn't know that the resolution on TV screens
had gotten twice as good.
Speaker 3 (26:41):
I guess the newest iPhones, or maybe it's just as good.
But that makes sense, like if you're looking at an
iPhone because it's a flip from your face or whatever,
but a TV is supposed to be far away, Like
can you even tell the difference?
Speaker 1 (26:52):
That's a good question, and it seems like you can.
So the tech nerds that's seen that, they wrote about
this in particular, and they said, actually that you shouldn't
buy one of these because they're too expensive. And if
anybody is going to tell you to buy a new,
fancy TV, it's the people I've seen it because they're
super into electronics, It's true, and they want to tell
you how awesome it is and why it's worth the
more expensive price tag. But their take was that the
(27:12):
older O lead technology does almost as much at a
fraction of the price. And on top of that, what
I would say is, if history is any indication, ak
TVs are going to get better and cheaper in a
matter of years, if not months, So you know, waiting
until price drops happen and technology improves is wise. You
don't want to be the early adopter of the new
(27:34):
technology that's overly priced. It's similar to basically every other
thing in the technology realm. The advances just aren't as
groundbreaking as they've been in the past. When you go
from from you know, seven to twenty to four K, man,
that's a big jump. When you go from four K
to eight K or probably sixteen K in a couple
of years or something like that, Like, you're just not
going to notice as much of a difference.
Speaker 3 (27:54):
Now, that's true. Let's keep the frugal live and train
go angel. Another way that some companies out there are
trying to ki to price conscious consumers is to offer
guaranteed pricing for longer periods of time in order to
combat this uncertainty that everyone is experiencing. Which sounds nice,
but here's the thing, you actually don't need it, and
you'd be overpaying in most cases if you opted for it.
(28:16):
So Verizon in particular, they're offering this guaranteed three year
price lock in basically for streaming customers. T Mobile is
doing something very similar with their wireless service, but first
of all, the prices are higher than our favorite mv
and os. On the note of T Mobile here, so
our favorite mobile virtual network operator carriers like Mint and
(28:39):
US Mobile are right out of the gate more affordable. Yeah.
But then secondly, phone bills have been going down in
recent years, and so a price lock is actually the
opposite of what you want. You want to be able
to shop around as the competition has increased, and as
competition has increased, prices they have dropped, and we want
you to take advantage of those dropping prices.
Speaker 1 (29:02):
Someone would benefit, a company would benefit from you price
locking when they charge more and when that thing is
actually experiencing deflation, which is what's happening in the cell
phone space.
Speaker 3 (29:10):
What they're doing is they're looking to provide stability for
themselves as a company as opposed to you.
Speaker 1 (29:16):
It's what sounds what sounds beneficial yeah to you, is
ultimately beneficial for them. So yeah, don't when you see
those price locks, you might think what a great company.
That is so sweet, I can't wait to take advantage
of that. But actually the opposite might be true. So
dig one level deeper. And it's no secret to Matt
that that concert prices have soared in recent years. That's
partly because of Ticketmaster's monopoly boo, but demand it's also
(29:39):
up as people prioritize those in real life experiences like
live shows. Yep, so going to a concert, it's amazing.
I think people assumed in the age of the internet
and like, I can literally stream shows for my favorite
artists online, but that only gets to be more excited
to go see the show in person. And I think
that's kind of what most people are feeling well now.
And of course, of course, you can pay for those
(30:01):
concert tickets in installments instead of paying for it all
up front. There have been a few articles written about
Coachella payment plans. Coachella is like two weekends. Happened this
past weekend and this coming weekend. Well, the La Times
called the Coachella payment plan financially smart to pay for
your six hundred dollars Coachella ticket over the course of
many months.
Speaker 3 (30:21):
A lot of booing during the segment.
Speaker 1 (30:23):
Of course, we think that is trash advice. La Times.
Get your game up. You pay an extra forty one
dollars for the privilege of paying for those tickets over time.
And I get that six hundred bucks is a lot
to pay. It's a lot of money for a weekend
festival to go see your favorite bands. Still, we think,
and this might sound incredibly old, school Matte. Maybe we're
(30:45):
like trad dads for suggesting that you have the cash
to pay for the thing you want to do upfront.
Man Like okay, Boomer, But that's truly the advice that
we have for you, and it's just tried and true.
It makes sense. Yeah, you should skip Coachella, you should
skip the concert you want to go to and save
up for next year's version. If you don't have the
money to pay for it.
Speaker 3 (31:05):
Yeah, it's to the La Times defense or to the
specific writer. He did say, if it's in your budget,
it's not your budget. If you have it kind of
depends on what your definition of what's in your budget, right,
Because in a similar way, we'll say, well, if you
have the cash on hand, if it's in your budget,
then sure, put that expensive charge on your credit card.
But even beyond that, it's the buy now, pay later,
(31:26):
the installment buying method, even if they're not charging you,
right because a lot of them they don't charge interest.
A lot of them actually do, or they have options
where you are paying interest. But what I think I've
realized about the buy now, pay later, where you're paying
it in installments, is that it in fact makes you
an installment buyer, and it's a slippery slope before you're
carrying a balance on your credit card because oh well,
(31:47):
that's also an installment. And then boom, what has magically
happened right in front of our eyes here that you
haven't even realized? You are living paycheck to paycheck? Like
that's what that does when you get on this, when
all of your expenses are essentially being automated without you
even thinking about it, Like that's like the very edition,
very definition of living paycheck to paycheck. And I think
that's what I'm realizing that I dislike about the buy now,
(32:09):
pay later is the habit formation that is taking place.
Speaker 1 (32:12):
It's the proverbial frog in the water that gets hotter
and hotter and doesn't jump out. And again, I don't
know if that's scientifically accurate or not, but it's it's
a good analogy. It's a good illustration. But I was
talking about that with a friend this morning, just questioning
the things that seem societally normal, because where they're going
to lead to is some pretty pisspoor financial circumstances. So
(32:35):
we want you to avoid what's quote unquote normal, be
a little more abnormal and what that means is like
paying cash upfront or putting on the credit card, but
having the money in the bank account to pay the
balance off on time and in full. If you have
to take the payment plan that costs extra money in
order to afford the ticket, you can't afford the ticket.
Speaker 3 (32:52):
Agreed, Buddy. That's going to be though for our Friday flight.
We hope everyone has a fantastic weekend. And if you're
looking for our sh notes some of the different articles
we mentioned, you can find that up at howtomoney dot com. Also,
we've got a fantastic page of resources that we will
link to in the show notes for this specific episode.
If you're essentially you're looking for the outline of what
(33:12):
it is that you should be doing with your money,
and of course that's for slash resources where you can
find those. But Buddy, that's gonna be it for this episode.
Until next time, best Friends Out, Best Friends Out.
Welcome to How to Money. I'm Joel Matt. Today we're
talking panic, pre buying, untrustworthy TikTok trends, and recession hair.
Speaker 2 (00:27):
Riscent Do I.
Speaker 3 (00:28):
Always have recession? Here? Joe? How's my hair look right now?
Speaker 1 (00:30):
It looks a little recession, not because you're but just.
Speaker 3 (00:35):
Part of entering into middle age. But friend, this is
our Friday flight. This is our quick sampling of the
different headlines that we came across this week and how
they're going to impact your personal finances. By the way,
stay tuned. On Monday, we're going to be talking about
I mean, within this Friday flight, we're talking about terrorists
to a certain extent, but I can't avoid it. Yeah,
on Monday's episode, we actually have a special ask How
to Money episode lined up for you, specifically addressing a
(00:58):
whole lot of tariff concerns.
Speaker 1 (01:00):
Folks have a lot of listener questions to look forward
to that people sent in because of course, they are
going to impact our lives in so many ways, depending
on what form they fully realize themselves. But yeah, so
people had a lot of questions about that. We try
to tackle as many as we could and looking forward
to Yeah, sharing that one with you guys on Monday.
Speaker 3 (01:17):
So you know what I've been seeing around town lately, Joel,
Not only on the interest. I feel like I've seen
them most of the time on the interstate, but even
this morning, as I was biking into our studio, I
see a Tesla past me and it's got the sticker.
You know what I'm gonna say, It's got the h
I about this before you went crazy sticker on there.
You've seen those, right, I've seen those. Yeah.
Speaker 1 (01:37):
What I found interesting though, I read about the guy
who started a company selling these elon stickers. Apparently it
makes like one hundred thousand dollars a month now selling
these stickers. Now, oh my gosh, it's capitalism at its finest.
Speaker 2 (01:49):
Man.
Speaker 1 (01:50):
Hey, if you guys and I get it too. As
a Tesla driver, you might want to signal, especially with
the violence that's being done to Tesla.
Speaker 3 (01:58):
What do you think about the signal? Get it?
Speaker 2 (01:59):
Because you for someone.
Speaker 1 (02:00):
To come up and a cost you for driving to Tesla.
They think maybe a political stance, but.
Speaker 3 (02:06):
Yeah, for most people's it's a product that someone has purchased,
like this is not a political statement. How did Tesla's
go from being a statement of like I'm trying to
help save the earth and I'm trying to be green,
or maybe I just like to drive a car that's
got an amazing amount of instant torque. So thinking that
this is, you know, a political statement, I think you
(02:27):
know how it happened. But I think most people are
less aware or care less about the political side of things,
and they're just trying to drive a car.
Speaker 2 (02:34):
That they like.
Speaker 3 (02:35):
I guess I get it. It's certainly how much of
the stickers. How much do they cost?
Speaker 1 (02:39):
I don't know, but apparently five bucks or something. Yeah,
apparently there's enough profit margin for this guy. The guys
I can get ton of money.
Speaker 3 (02:44):
It's a cheap form of insurance, right, Like, Yeah, if
you are trying to keep folks from kying your car
or slashing your tires, even lighting your car on fire, right,
I certainly, I certainly understand.
Speaker 2 (02:55):
It's just sad that you would have to do that.
Speaker 3 (02:56):
I think it probably depends on where you live, too, right,
because if you are living an environment where maybe it's
a bit more progressive or left leaning, and you're driving
a Tesla around, you're getting that bombastics? Is it? Bombastic?
Side eye is that what the kids are saying.
Speaker 1 (03:08):
But then again, that's where a lot of those teslas reside.
Think about like per capital, there's more teslas in California
than there are in like maybe more red leading states.
Speaker 3 (03:16):
So fascinating to see if it truly does become a
political statement if folks who are more right leaning tend
to tend to buy buy vehicles. But speaking of vehicles, actually,
did you see last month that retail car sales increased
by almost five percents While we're talking about cars here, Yeah,
that's not just evs but just new vehicles across the
board shot up in anticipation for the upcoming.
Speaker 2 (03:39):
Terrorists, a little bit of that pre buying action.
Speaker 3 (03:40):
At this point, Americans are expecting higher levels of inflation
than they have in like something close to thirty four years,
which can lead to pre buying. It can lead to
this self fulfilling prophecy of sorts.
Speaker 1 (03:52):
Because yeah, if you think prices are going to go up,
you're more likely to buy more now, sure, because you
don't want to pay the higher price tag later.
Speaker 3 (03:59):
I get the impulse, and I think it can make
sense if essentially you're kind of pulling some of that
purchasing forward, right if it's an item that you were
already planning on buying. But this is also hard to
gauge because tariff levels are constantly changing. If there's anything
that we've learned, it's that which is not normal tariff policy,
but it is the new normal. Like if you bought
an iPhone that perhaps you didn't need, well, you might
(04:19):
be kicking yourself because they were exempted from the terraff.
Consumer spending at Apple was up twenty percent in the
first week of April before that carve out, before that
reprieve was granted. Shelf stable foods have even been purchased
at higher levels as well. I think some folks. There's
reports of some folks stocking up on Christmas items as
they're looking ahead, because think about all the plastic that
(04:41):
comes from It's not just plastic, but when we.
Speaker 1 (04:43):
Buy most of our toys from China, and if there
is one hundred and forty five percent tariff that remains
on those Chinese goods that come overseas, yeah, Christmas is
going to get a heck of a lot more expensive
and companies, American companies aren't going to be able to
shift on a dime. And source those toys elsewhere. So
I that's true. I get some of that impulse, and
we don't know how this is going to shake out ultimately.
(05:05):
I will say the silver lining to buying your Christmas
presents early maybe you do get a better deal, but
also you don't have to worry about Christmas shopping later on.
Speaker 2 (05:11):
I mean that sounds kind of nice.
Speaker 3 (05:12):
Until Christmas rolls around. It's just like, oh, yeah, I'm
not interested in that hobby at all anymore. You're well, sorry.
Speaker 2 (05:18):
Tariffs mom, that was just six months ago. Like you're
totally gonna disappoint your kids.
Speaker 1 (05:22):
Yeah, well, so interesting to see the knock on effects, right,
and the kind of domino impact of tariffs and so like.
Used car prices have actually gone up for the first
time in two and a half years because of tariffs.
Speaker 3 (05:33):
Which we thought that the pandemic was going to be
the last time we ever saw used car prices go
up because of the snarled supply chain, right right, Like
that's why, like everybody was looking to us and we're like,
this is a one time blip.
Speaker 2 (05:45):
That was an anomaly.
Speaker 3 (05:46):
Here we go, Yep, yep, another anomaly.
Speaker 1 (05:48):
Another anomaly again in short order, because the supply chain
of new cars is being threatened by higher prices. It's
leading to less supply that pre buying we're talking about,
and then higher prices on on used cars as more
people turned to that market to get what they need.
Speaker 3 (06:04):
Trump is now the ever grand that's stuck sideways those.
Speaker 2 (06:09):
Yes, the Pandama Canal.
Speaker 3 (06:13):
Yeah, yeah, actually it's not. Well, yeah, luckily the Panama
Canal has not entered into the equation. I guess recruiting
changed on that one yet. Oh man, well, so this
is less I think of capitalizing on a sale and
more like buying now because of looming threats. Right, this
is what people are doing. And I think it's okay
to purchase some items ahead of time, but in these
uncertain economic times, man, I think it's also important to
(06:35):
note that cash is important. Right when you're not sure
what's going to happen with pricing, and maybe when you're
unsure what's going to happen with your income. Most folks
just can't afford to stockpile or buy significant amounts of
items ahead of time, particularly those more expensive items. Like
I was going to get an iPhone next year, I
might get it now. Well that's that's like a thousand bucks, right,
and most people just can't afford to do that in
(06:57):
anticipation of saving twelve hundred bucks a year from now.
I think, more than anything, that we want to communicate
to people is just not don't buy stuff that you
don't need just because you're worried about price increases, because those,
as we've seen, are nearly impossible to predict, and it's
hard to know where tariffs go from here. And I
get the anxiety that people are feeling, but I also think, well,
(07:20):
spending more of your money and having less less of
a cash reserve is it necessarily the right way to
approach this, and that could lead to even more anxiety
and potential hartburn later on. People got to have their stuff. Yeah,
I think that's the mentality. Hey, let's talk about pandemic
throwbacks for a second longer here. Remember the restaurant search
charges back during COVID. Oh yeah, the was it like
(07:41):
a specifically for PPE the protective that's right, was what
do I even stay for personal protection equipment or some
something like that.
Speaker 1 (07:49):
And I think people didn't mind it in the moment,
but the longer those tariffs surcharges lingered on restaurant bills.
That's when people started to get.
Speaker 3 (07:56):
Yeah, yeah, yeah, it's just like, isn't the government sending
out like free tests and their masks everywhere now like
early again, everyone gets a buy early on when we
had no idea what was going on. But yeah, it
didn't take very long before I at least was annoyed
at some of the search charges that we're seeing specifically
at restaurants. Well, on that note, more companies are now
(08:16):
imposing tariff surcharges, so instead of jacking out their prices,
they're finding a way to communicate and to let their
customers know that, hey, the government policy is to blame
here for this bigger bill. And depending on where different
companies are sourcing their products from, depending on how quickly
they're able to pivot, it won't just be a tariff
(08:37):
surcharge that you're seeing, but actual higher base prices as well.
Companies out there, particularly particularly the small and medium sized ones,
they're in a tough spot, you know, they're kind of
stuck between a rock and a hard place. They're trying
to figure out how to proceed, and while there is
a whole lot of uncertainty now, I think it's again
sort of like early on during the pandemic, let's just
(08:59):
kind of be kind to everyone, to all businesses as
they in particular are trying to figure out how to
proceed and how to stay solvent. Yeah. Especially Yeah.
Speaker 1 (09:08):
I talked to someone the other day and they have
a side business and they buy cookwear from China, and
they just canceled a large order because they were like, well,
we can't. We don't know if we can be profitable
right with this tariff in place, and so right now,
like this business is on hold. And I think there's
a lot of people that are in a situation like that.
(09:29):
And for businesses that can't afford to do that, they
still have a product they have to get to their customers,
and they don't want to want it to look like
their prices are jumping dramatically, and they want to communicate.
Like you said, Matt, hey, this is the reality we're
all living in right now. Here's how much more it
is costing. Here's why I'm passing on this higher cost.
I think it makes more sense than maybe some of
the long lasting restaurants surcharges we saw, sure, but I
(09:53):
would say use this maybe as an excuse as an
individual consumer to start buying secondhand right because tariffs and
then the threat of more widespread tears, particularly on the
countries that manufacture so many of our clothes, They've been
great for thrift stores. People are shopping at thrift stores
more often. You and I were like, Hey, no matter
what's happened to the economy, shop at your local thrift
store anyway. So it's not just that folks are trying
(10:15):
to avoid paying more for their garments. They're just also
worried about more lean economic times coming about and downturns. Man,
what happens in a downturn always is barket basement options.
They tend to see a whole lot more traffic. And
it's also interesting, when the economy is booming, people save less.
When the economy is tightening, people tend to save more.
(10:36):
It's like the opposite reaction you would assume. And we're
already keen on places like Facebook, Marketplace. We like yard sales, Matt.
I know you like freebies on the curb too, that's
kind of your jam curb alerts. Yeah, but don't forget
about like goodwill and then just making do with less.
And I think I might sound odd, but I don't
think of these shifts in shopping as like a negative thing. Really,
(10:59):
what you're doing as you're making smart changes to stretch
your money. I don't think there's any shame in that.
And I think actually, like I wear my awesome Goodwill
finds with a badge of honor, I think it's instead
of a status symbol being a fancy car, it's the
cool shirt I found that nobody else has because it's
one of a kind because I got it from the good.
Speaker 3 (11:15):
Will, or the shirt's one of a kind because it's
got holes in it, which is literally I'm gonna turn
around here. Can you see my back?
Speaker 2 (11:24):
Oh yeah, that's that's a big hole, large hole.
Speaker 3 (11:27):
You know what. I like this pocket tea and I
was like this close to.
Speaker 1 (11:30):
Talk to your recession hair. Combined with the holes in
your shirt, people are probably worried about your buddy.
Speaker 3 (11:34):
We will get to that one here in a little bit,
but let's talk about a recent TikTok trend that has
been gathering steam. There have been videos from influencers online.
Maybe you've even seen some of these influencers because you
follow them, but they are claiming that luxury handbags or
Lulu Lemon leggings that are being made in China that
you yourself can in fact have them for a steal by
buying directly from these Chinese manufacturers. Why it sounds enticing
(11:57):
cut off the middle man? Yes, why would you be
h be willing to pay burbery prices when you can
get that same luxury item for pennies on the dollar
jewel and it sounds pretty cool. That's not necessarily true.
A decent chunk of high end luxury products are actually
made in France and Italy. They're not made in these
Chinese factories. The vast majority of Gucci items, for instance,
(12:19):
are made in Italy, the same with Louis Vuitton. Some
even make products in the US. That experiment actually hasn't
gone well. There's been reports of trying to train up
US workers to make leather handbags and it's like, oh, yeah,
they're really bad at doing that.
Speaker 2 (12:36):
The artisans in Europe are better than this.
Speaker 3 (12:37):
It's taking years and all they're doing is just like
a minimal leather pocket or something like that on a handbag.
It's actually pretty funny, but many luxury items are actually
manufactured in China and then shipped elsewhere to be quote
unquote finished. So if you opt to go this route,
it reminds me of buying on the streets of New
York Jowel. There is a reasonable chance that the allure
(13:01):
of trying to snag some of these luxury atoms for cheap, well,
in fact, you're gonna get a knockoff product. You're not
getting a crazy deal because you bought direct. You're buying
you're buying a fake product.
Speaker 2 (13:10):
Have you ever.
Speaker 3 (13:11):
Specifically gone up to New York and gone to Canal Street.
Speaker 1 (13:13):
Oh, for sure, going in high school and we called
them folk LEAs because Oakley's were very cool back then,
and you would buy a pair of Focles.
Speaker 2 (13:20):
You knew what you were getting.
Speaker 1 (13:21):
I mean, you knew they were eight dollars for a reason,
not because they were real Oakley's that had been cut
out the middleman. It was because they were a knockoff
that was much cheaper. I think that there's a certain
sort of badge of honor in getting certain fake items.
Like the first time I went to New York, I
drove up there in my jeep with my buddy Kyle. Actually,
so we didn't drive to New York. We drove to
Poughkeepsi and took a train from Poughkeepsi to New York.
(13:44):
It was the opposite of the something Corporate song.
Speaker 3 (13:47):
We didn't wake up in the car, but we specifically,
of course you're wanting to do, like hit all the
highlights in New York City. And I can't remember what
kind of watch it was. I think it was like
a Brightling, but of course I knew I was getting
a fake. I think it was like Prightling or something
like that. I don't know, but I like the hands
on the face of the dial right, like they fell
off in like a year, but like I knew that
was going to happen. But it's also that's part of
(14:09):
the allure.
Speaker 1 (14:10):
Yeah, exactly. I mean it's like a fraction of the price.
It's interesting to see these these like people literally who
work in some of these Chinese Chinese factories trying to
reach out directly to American consumers and say, hey, skip
the name brands, we have something very similar or or
they're basically making it sound like it's the exact same,
but you can get it directly from them for a
lot less. And there are there are Yeah, and obviously
(14:33):
we know that a lot of luxury items are kind
of handmade, and they are more expensive for a reason.
But then other luxury companies use manufacturers in China and
in India, right, and then sometimes they'll finish the item
in Europe so they can say that it's made in
Italy because Yeah, for some reason, consumers don't value items
made in China as much as they do as something
that at least seems like it's handcrafted in Europe. Fully,
(14:56):
this reminds me of dupes too, which we've talked about
on the show. Yeah, some folks pursue who dupes passionately.
You know, people want the vibe without forking over the
big Bucks. Walmart, for instance, had the fake burkin bag.
The working that's sold out incredibly quickly, and then people
were reselling on eBay for ridiculous sums of money.
Speaker 3 (15:13):
Working bag. Yeah, but you.
Speaker 1 (15:15):
Know, for like the real air Mas burken bag, those
are made by individual artisans, like with a single piece
of leather, right, and I think they're handstitched by a
single artisan. They sell for many, many thousands of dollars
if you can even get one. I've got no problem
with people buying luxury items. I don't partake. I don't
care about luxury goods, but and I don't care about
(15:37):
attempts to mimic those goods and create something that is similar,
even if it's lower quality. Just don't think that you're
getting a real Louis Vuitton handbag for five bucks or
something like that. I mean, there's this one video where
this lady is like showing these persons. She's like two dollars,
two dollars, two dollars. It's just not going to be
the same thing. It's not gonna be the same quality.
Speaker 3 (15:54):
Nope.
Speaker 1 (15:54):
And most luxury goods, of course we all know this.
They're an attempt at signaling wealth. But if you spend
a lot of money on luxury stuff, it has the
opposite impact.
Speaker 2 (16:03):
You're draining your.
Speaker 1 (16:04):
Bank account to signal wealth that you no longer have.
And I think there are always exceptions, there are ways
to get something similar in this kind of wild West
consumer environment that we live in. But you got to
do your due diligence, and you got to realize that
the thing that's being sold to you for five bucks
is not the same thing as being sold to you
for fifteen hundred, and hey, maybe you don't need either that's.
Speaker 3 (16:24):
Right, man, But we've got more to get to. We
got more personal finance stories to get to. We're going
to talk about the CFPB, We're going to talk about Coachella.
What other show is going to talk about both the
CFPB and Coachella in the same podcast. So we got
that more right after this. All right, Matt, we're back.
Speaker 1 (16:47):
We got more money saving information we got to get
to on this episode. This is, of course, time for
the ludicrous headline of the week. This one comes from MarketWatch.
The headline reads, experts now recommend a twelve month emergency fund.
And I hate to do this, Matt. I don't want
to throw a good, a well intentioned person under the bus.
Speaker 3 (17:07):
Here. You're gonna throw me under the bus. I like
twelve month emergency funds. I'm not. I just think. Okay.
Speaker 1 (17:12):
So this was a specific recommendation of a former guest
for Meat Safety, and we've had him on before, we
like Reramiet. But he's been making the rounds. He's now
telling folks that the twelve months is the emergency fund
they need now. And I think there's a difference Matt
versus telling people, Hey, if you really want to save
up to twelve months more power to you go for it. Yeah,
I get the impulse to tell people to save more.
(17:35):
I like savings too, and I have a larger than
six month emergency fund personally. But I think also this
is moving the goalposts on people. When you've told people
for so long, hey, you need three to six months
worth of savings, which, by the way, most people don't
have any work close to that. I'm sorry, But changing
the metrics and then telling everyone to quickly amass six
(17:56):
or nine months or more worth of expenses, it sounds
like a panic reaction to me. And so I get
the destabilizing effects of tariffs, the higher potential for a recession,
and really, you know, the stomach churning nature of bigger
market drops that we've seen. But either three to six
months of emergency money, either it's enough or it isn't.
(18:17):
And I don't think that changes. Like we know, the
whole reason of an emergency fund is to save four
potential tough times. Just because things have gotten a little
more squrely doesn't mean we need to change the prescription.
I think for potential teas.
Speaker 3 (18:30):
All right, I might disagree with you just a little
bit here. I might kind of side with re meat
because when things change, when like the facts on the
ground change, I think it's worth considering how much money
you've got in cash, set asided savings and so like.
For someone who's got three months, you know, I think
this might be a call to say, all right, hey,
maybe I should have like closer to fourty five or six,
(18:50):
or if you're somebody that has like nine, you're saying
forty five for months is a bit extreme, the full stop,
I'll put that out there. But I certainly hate what
seems like fear mongering though, Like, and that's the part
that kind of drives me crazy, is that if it
is like a knee jerk reaction to the headlines and
it's just like, oh man, you need to be doing this,
(19:12):
then certainly I don't I don't like that. But if
you are someone who believes that, and maybe you're somebody
your financial situation isn't super stable, maybe you're if you're
a one income household, if you're somebody who works for
a company that's looking to downsize significantly, I would have.
Speaker 1 (19:27):
Said you should have already been towards that six month
range and all the three Yeah.
Speaker 3 (19:30):
Yeah, absolutely, But then beyond that given the sortain uncertainty
that we've seen in the destabilization of our economy and
certain specific industries as well, I think it's if you
think that there are big changes coming, well, I think
it would not just be worth considering that advice, but
I think it would be wise and even prudent to
sort of follow your gut to what you as an
(19:52):
individual feel comfortable with, because I just don't want there
to be like a blanket prescription of like, no, you
shouldn't you shouldn't be doing that, because when you know,
folks batten down the hat, which is when they see
a storm coming, and I think that this could be
a way for folks to do that. I don't like
that personal finance in this way feels like it's getting
slightly political because a lot of times you see the
different headlines and it seems like it's just a reaction
(20:13):
to different publications that are trying to stir up a
whole lot of clicks and eyeballs.
Speaker 1 (20:18):
Basically, Yeah, So, I guess you as an individual can
determine how big your emergency fund should be and whether
you should be more worried right now increasing your savings,
and I think you make a good point, Matt. I
think it can make sense to reassess how much you
have in savings and how vulnerable you are to changes
right now. But I guess just a blanket prescription to
(20:40):
change how much you have in savings feels like a
little too much to me. And I think a lot
of people that the emergency fund they built up is
likely sufficient for most cases. And the truth is, too,
we can't prepare for everything. We cannot be fully prepared
for everything, and so it might mean missing out on
some of the investments that you would have made and
(21:00):
some of the tax advantaged accounts you would have stuck
money into. If you were to say, oh, wait, twelve
months is now the standard, I guess I got to
get their asap. And that could create other problems in
your financial life too.
Speaker 2 (21:13):
That's true, all right.
Speaker 1 (21:14):
While we're talking about savings and banks, should we worry
about overdraft fees?
Speaker 2 (21:19):
Coming back?
Speaker 3 (21:19):
Well?
Speaker 1 (21:20):
USA Today had a headline that said it's time to
worry about overdraft fees and they highlighted the demise of
the Consumer Financial Protection Bureau, which we've talked about on
the show. Speaking of negative headlines, yeah, I'm looking so hot,
right now, and they talked about the scrapping of the
proposed rule to bring overdraft fees down to five bucks
later this year. That was supposed to happen in October,
(21:42):
and now it ain't gonna happen. So yeah, some fear
mongering articles are being written about that. And yes, it's
true when you look at the numbers, overdraft fees have
become a lot more costly over the past decade. But
at the same time, there's also been a trend reversal
by some of our favorite online banks to eliminate those
fees altogether. So the disparity is is significant. Right, Even
(22:08):
for overdraft fees don't have a federally mandated cap you
as a person, you can still avoid them by doing
business with banks that don't charge them. So Capital One
discover ally CI all of those banks that we typically recommend,
they don't charge any sort of overdraft fee at all.
They've eliminated them all together.
Speaker 3 (22:29):
Those are the good ones.
Speaker 1 (22:30):
Yeah, Wells Fargo, what do they charge Matt per overdraft
infraction more than l thirty five bucks? That's ridiculous. Chase
so much money.
Speaker 3 (22:39):
Chase gives you a deal at thirty four per per
time you overt case that one dollar was going to
make a difference for you.
Speaker 2 (22:46):
Right there you go.
Speaker 1 (22:47):
And then the incredibly benevolent folks at Bank of America
they charge a much less offensive ten dollars per overdraft infraction.
That's still offensive in my book, but it's less offensive
I feel infinitely more than zero, right exactly. And so
I guess people might read this, and they might they
might be upset at the fact that banks aren't being
(23:08):
mandated to remove overdraft fees or reduce them significantly. And
I say, well, there's actually a lot of competition in
that space, and some awesome banks have made that part
of their marketing materials, kind of like Southwest did for
free check bags. No longer, sadly, but it's one of
those things that makes you stand out in this banking environment.
Go with a bank that doesn't charge over draft fees,
(23:29):
and hopefully you're paying enough attention to your finances too,
and you've got enough patting in there where over draft
fees aren't a problem.
Speaker 3 (23:34):
On the note of Southwest, what if them dropping the
free check bags is just a headfake and then they
bring it back, Oh my gosh, and that we've all
been played and it just engenders more love for them
because they're like, you know what, we listen to the people,
and we are a company for the people that would
be smart.
Speaker 1 (23:51):
When I would love that because well, I will say this,
I booked a trip for this fall, and I booked
before they stop the free check bag theme because this
is my backpacking trip. It's a really big bag I'm bringing,
and so I was glad to get in under that
free check bag wire. Yeah, let's keep going the word recession.
We've heard that being tossed around a whole lot more
(24:13):
right now. Understandably, we actually covered recessions in our latest newsletter, plug.
Speaker 2 (24:17):
For the Hada Money newsletter. Go sign up if you're.
Speaker 3 (24:18):
Not hoadamoney dot com forward slash newsletter, well Joel. In
times of greater uncertainty, frugality starts to become cool again,
ways to save more. They're starting to trend in ways
that they didn't when the economy was firing on all cylinders,
and that's where recession hair comes in. This appears to
be one of those where ladies they're waiting longer between
(24:40):
salam visits, they're letting their roots show or power to you. Ladies,
I'm all about that, letting their hair grow long and
going back to the natural color. I think the male
equivalent is certainly what I did during the pandemic, letting
the hair go really long or cutting it yourself. We
should post a picture of that for people you've got
to grow really long. I look significantly old older. That
was like double ear, man, it was. It was pretty crazy. Yeah,
(25:03):
you know, and I did the math. Because this kind
of behavior compounded over time, Joel, it makes the big
difference cutting over different. So the average the average dude's
haircut is thirty bucks and typically depends on who you are,
but most guys go to the barber anywhere between three
and six weeks. So I figured, all right, thirty bucks.
Let's say every month you do that for thirty years,
(25:25):
which is how long I've been cutting my own hair.
Now you're looking at over forty thousand dollars, man, compounded
in the market. Isn't that not insane? Just by this
one little thing that I do.
Speaker 1 (25:35):
Myself well, and a set of hair clippers once a
month us what thirty bucks? And with the additional because
you have some additional links that you have for the
top of your hair, so you don't have to use
scissors on it, because that's where things get a little
score at using scissors, where it.
Speaker 3 (25:49):
Gets a little dice.
Speaker 1 (25:50):
Yeah, And I know for for women it's different, I know,
and everyone has our different kind of fashion standard, but
they want to it's.
Speaker 3 (25:57):
Got their own craft beer equivalent.
Speaker 1 (25:58):
But I kind of like when people lean into this
stuff and they and they make it cool to be frugal,
because I think it just gives people the hall pass
to say, okay, cool, Yeah, I'm gonna jump in on that.
I'm not doing this. And it's similar to it's like
wearing that frugal that frugal change as a as a
badge of honor instead of being feeling like ashamed about
it or feeling like that cost cutting endeavor is somehow badly.
Speaker 2 (26:20):
Reflected on you for the whole world. That's right, Yeah, exactly.
Speaker 1 (26:23):
Well, and then say some other ways, we could say
Matt is not buying cutting edge technology, right.
Speaker 3 (26:29):
Well, I didn't realize this.
Speaker 2 (26:30):
Was a thing. I just saw that this week. Eight
k TVs. Did you know that was.
Speaker 3 (26:34):
These are like yeah, there, like the super fancy ones.
Speaker 1 (26:36):
Somehow I didn't know that the resolution on TV screens
had gotten twice as good.
Speaker 3 (26:41):
I guess the newest iPhones, or maybe it's just as good.
But that makes sense, like if you're looking at an
iPhone because it's a flip from your face or whatever,
but a TV is supposed to be far away, Like
can you even tell the difference?
Speaker 1 (26:52):
That's a good question, and it seems like you can.
So the tech nerds that's seen that, they wrote about
this in particular, and they said, actually that you shouldn't
buy one of these because they're too expensive. And if
anybody is going to tell you to buy a new,
fancy TV, it's the people I've seen it because they're
super into electronics, It's true, and they want to tell
you how awesome it is and why it's worth the
more expensive price tag. But their take was that the
(27:12):
older O lead technology does almost as much at a
fraction of the price. And on top of that, what
I would say is, if history is any indication, ak
TVs are going to get better and cheaper in a
matter of years, if not months, So you know, waiting
until price drops happen and technology improves is wise. You
don't want to be the early adopter of the new
(27:34):
technology that's overly priced. It's similar to basically every other
thing in the technology realm. The advances just aren't as
groundbreaking as they've been in the past. When you go
from from you know, seven to twenty to four K, man,
that's a big jump. When you go from four K
to eight K or probably sixteen K in a couple
of years or something like that, Like, you're just not
going to notice as much of a difference.
Speaker 3 (27:54):
Now, that's true. Let's keep the frugal live and train
go angel. Another way that some companies out there are
trying to ki to price conscious consumers is to offer
guaranteed pricing for longer periods of time in order to
combat this uncertainty that everyone is experiencing. Which sounds nice,
but here's the thing, you actually don't need it, and
you'd be overpaying in most cases if you opted for it.
(28:16):
So Verizon in particular, they're offering this guaranteed three year
price lock in basically for streaming customers. T Mobile is
doing something very similar with their wireless service, but first
of all, the prices are higher than our favorite mv
and os. On the note of T Mobile here, so
our favorite mobile virtual network operator carriers like Mint and
(28:39):
US Mobile are right out of the gate more affordable. Yeah.
But then secondly, phone bills have been going down in
recent years, and so a price lock is actually the
opposite of what you want. You want to be able
to shop around as the competition has increased, and as
competition has increased, prices they have dropped, and we want
you to take advantage of those dropping prices.
Speaker 1 (29:02):
Someone would benefit, a company would benefit from you price
locking when they charge more and when that thing is
actually experiencing deflation, which is what's happening in the cell
phone space.
Speaker 3 (29:10):
What they're doing is they're looking to provide stability for
themselves as a company as opposed to you.
Speaker 1 (29:16):
It's what sounds what sounds beneficial yeah to you, is
ultimately beneficial for them. So yeah, don't when you see
those price locks, you might think what a great company.
That is so sweet, I can't wait to take advantage
of that. But actually the opposite might be true. So
dig one level deeper. And it's no secret to Matt
that that concert prices have soared in recent years. That's
partly because of Ticketmaster's monopoly boo, but demand it's also
(29:39):
up as people prioritize those in real life experiences like
live shows. Yep, so going to a concert, it's amazing.
I think people assumed in the age of the internet
and like, I can literally stream shows for my favorite
artists online, but that only gets to be more excited
to go see the show in person. And I think
that's kind of what most people are feeling well now.
And of course, of course, you can pay for those
(30:01):
concert tickets in installments instead of paying for it all
up front. There have been a few articles written about
Coachella payment plans. Coachella is like two weekends. Happened this
past weekend and this coming weekend. Well, the La Times
called the Coachella payment plan financially smart to pay for
your six hundred dollars Coachella ticket over the course of
many months.
Speaker 3 (30:21):
A lot of booing during the segment.
Speaker 1 (30:23):
Of course, we think that is trash advice. La Times.
Get your game up. You pay an extra forty one
dollars for the privilege of paying for those tickets over time.
And I get that six hundred bucks is a lot
to pay. It's a lot of money for a weekend
festival to go see your favorite bands. Still, we think,
and this might sound incredibly old, school Matte. Maybe we're
(30:45):
like trad dads for suggesting that you have the cash
to pay for the thing you want to do upfront.
Man Like okay, Boomer, But that's truly the advice that
we have for you, and it's just tried and true.
It makes sense. Yeah, you should skip Coachella, you should
skip the concert you want to go to and save
up for next year's version. If you don't have the
money to pay for it.
Speaker 3 (31:05):
Yeah, it's to the La Times defense or to the
specific writer. He did say, if it's in your budget,
it's not your budget. If you have it kind of
depends on what your definition of what's in your budget, right,
Because in a similar way, we'll say, well, if you
have the cash on hand, if it's in your budget,
then sure, put that expensive charge on your credit card.
But even beyond that, it's the buy now, pay later,
(31:26):
the installment buying method, even if they're not charging you,
right because a lot of them they don't charge interest.
A lot of them actually do, or they have options
where you are paying interest. But what I think I've
realized about the buy now, pay later, where you're paying
it in installments, is that it in fact makes you
an installment buyer, and it's a slippery slope before you're
carrying a balance on your credit card because oh well,
(31:47):
that's also an installment. And then boom, what has magically
happened right in front of our eyes here that you
haven't even realized? You are living paycheck to paycheck? Like
that's what that does when you get on this, when
all of your expenses are essentially being automated without you
even thinking about it, Like that's like the very edition,
very definition of living paycheck to paycheck. And I think
that's what I'm realizing that I dislike about the buy now,
(32:09):
pay later is the habit formation that is taking place.
Speaker 1 (32:12):
It's the proverbial frog in the water that gets hotter
and hotter and doesn't jump out. And again, I don't
know if that's scientifically accurate or not, but it's it's
a good analogy. It's a good illustration. But I was
talking about that with a friend this morning, just questioning
the things that seem societally normal, because where they're going
to lead to is some pretty pisspoor financial circumstances. So
(32:35):
we want you to avoid what's quote unquote normal, be
a little more abnormal and what that means is like
paying cash upfront or putting on the credit card, but
having the money in the bank account to pay the
balance off on time and in full. If you have
to take the payment plan that costs extra money in
order to afford the ticket, you can't afford the ticket.
Speaker 3 (32:52):
Agreed, Buddy. That's going to be though for our Friday flight.
We hope everyone has a fantastic weekend. And if you're
looking for our sh notes some of the different articles
we mentioned, you can find that up at howtomoney dot com. Also,
we've got a fantastic page of resources that we will
link to in the show notes for this specific episode.
If you're essentially you're looking for the outline of what
(33:12):
it is that you should be doing with your money,
and of course that's for slash resources where you can
find those. But Buddy, that's gonna be it for this episode.
Until next time, best Friends Out, Best Friends Out.
Hosts And Creators
Joel Larsgaard
Matthew Altmix
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