Comments for The Money Guy Show | Investing, Tax, Estate, Retirement, Insurance, Spending, Saving, and Wealth Building Advice Going beyond common sense and helping you make smart financial decisions. Tue, 23 May 2017 12:57:23 +0000 hourly 1 Comment on Top Tips to Prepare for Retirement by Dusten V Sun, 08 Jun 2014 00:54:09 +0000 The M-G podcast has a lot of good advice! This episode got me thinking about how to deal with selecting funds to invest in with my ROTH IRA. There are so many funds! I am 28 yrs old and know I need to invest in funds with higher risk. Is there a gauge/rule that you use to analyze funds based upon how much risk they carry? (other than stock investment percentage)
Thank you for sharing your knowledge!


Comment on Is Lending Club a Good Idea? by Brian Preston Mon, 05 May 2014 16:42:56 +0000 Kevin,

Thank you for the comment! Lending Club seems to be really pushing to extend their market. Hopefully you will not be left out of the mix for much longer.

Lending Club reports earnings on the tax form 1099-OID.

I hope this helps. Thank you for listening to the show!


Comment on Is Lending Club a Good Idea? by Brian Preston Mon, 05 May 2014 14:00:23 +0000 Mike,

Thank you for the kind words! It makes me happy to hear that you could not wait to listen to the new show (we must be doing something right)! Keep us updated on your LC experience.

There is nothing wrong with being a geek, in fact, our t-shirt campaign is centered around being “Geek-Chic.” We think it is cool to be a geek, especially when it relates to $$.


Comment on Is Lending Club a Good Idea? by Mike Pascale Sat, 03 May 2014 13:17:34 +0000 Brian – great show on Lending Club. I had put some “fun” money in after listening to your initial show on LC. Ever since, I’ve been waiting for another discussion on this concept. Your no nonsense approach showing both pros and cons really reinforced my opinions on peer to peer lending. I will continue to keep a small portion working in this asset class.

I must be a real geek. I normally listen to you when working out at the gym, but when I saw the topic – I couldn’t wait and listened to the show laying in bed. My wife forced me to wear headphones and thinks I’m nuts!

Thanks for all the great shows! Also, fantastic video! May you have continued success,


Comment on Is Lending Club a Good Idea? by Kevin Sat, 03 May 2014 01:35:57 +0000 Hi,
I listened to your podcast for the Lending
Club. It seems like an interesting opportunity
for a hobby. Unfortunately, I live in a state that
does not currently allow me to participate. I am curious
to know how the earnings are reported for tax purposes?
Are the earnings reported and handled like capital gains?


Comment on Is Identity Theft Protection Worth It? by Peter Wed, 23 Apr 2014 01:40:28 +0000 “I would rather tell the credit card company to go find their lost money, than try to beg the bank to reverse the charges on my account. ”

I totally agree with Brian on this one. Credit cards are FAR safer than debit cards. My bank forces me to have a combination debit/ATM card but I have lowered the limit on the signature based transactions to $100, so even if it is compromised, they aren’t cleaning out my account right away.

I have to give you guys a huge amount of credit (pun intended) for pointing out the difference between true identity theft and regular run of the mill credit card fraud. There is a big difference, and I think part of the reason people are so afraid of identity theft is that a lot of media outlets lump credit card fraud and identity theft together, claim they are both identity theft and therefore happen all the time. Regular credit card fraud does happen all the time, and it’s an annoyance if it happens to you, but it’s not the end of the world, and as you mentioned, it typically doesn’t cost you a dime. True identity theft, or new account creation on the other hand, are really serious problems that can haunt you for years. People are so obsessed with protecting their credit card numbers when what they really should be protecting is their SSN and their other very personally identifiable information that is difficult to change or replace.

Getting a credit card re-issued with a new number takes 15 minutes on the phone. Ever try getting a new SSN or driver’s license? It takes A LOT longer than that.

Comment on Is Identity Theft Protection Worth It? by Brian Preston Tue, 22 Apr 2014 19:26:59 +0000 Steve,

You make a great point. It may be easier to deal with your personal banker (or bank) than your credit card company, in the event of a loss. However, the way consumer protection laws are written, there are definitely more protections afforded to users of credit cards than debit cards. Reducing your liability to a maximum of $50 is much more preferential than possibly having an unlimited liability from fraudulent charges on a debit card.

The Federal Trade Commission’s website that summarizes the “Fair Credit Billing Act (FCBA)” and the “Electronic Fund Protection Act (EFTA)” states:

For credit cards, “Under the FCBA, your liability for unauthorized use of your credit card tops out at $50. However, if you report the loss before your credit card is used, the FCBA says you are not responsible for any charges you didn’t authorize. If your credit card number is stolen, but not the card, you are not liable for unauthorized use.”

Regarding debit cards, “If you report an ATM or debit card missing before someone uses it, the EFTA says you are not responsible for any unauthorized transactions. If someone uses your ATM or debit card before you report it lost or stolen, your liability depends on how quickly you report it.” Depending on the time it takes to report fraudulent charges you could be left to cover nothing at all or up to the entire bill.

Our philosophy is, why take the chance? If consumer protection laws establish a $50 maximum loss for credit cards, why would you chance being on the hook at all? I would rather tell the credit card company to go find their lost money, than try to beg the bank to reverse the charges on my account.

Thanks for your thoughts!


Comment on Is Identity Theft Protection Worth It? by Steve MoneyPlanSOS Stewart Tue, 22 Apr 2014 03:55:10 +0000 Hi Brian and Bo-G. Thanks for the show on ID theft.

I need to give you some real-world stories about debit vs credit cards. In 2010 and 2011 my wife and I had our personal debit cards compromised and I had my business card compromised. Two of the banks contacted us and reversed the charges as soon as we signed a form, the third we found out when balancing our checkbook and they reversed the charges over the phone.

However, I have a relative whose credit card was compromised. She called the issuer and was told to contact the person/vendor who fraudulently charged her card. Of course the fraudulent company wasn’t going to do anything and she contacted her credit card company again with no luck. She was about to give up and just pay the bill (stupid thing to do) until I got involved and had her convince the credit card company to reverse the charges or she’d cut up the card and go somewhere else.

There is all this talk about how debit cards aren’t safe, including in this episode. I vehemently disagree, this is coming from personal experience, and don’t understand how such an outdated theory has gone unchallenged for so long.

Today we have the internet in our hands and are able to video conference with people on the other side of the planet. Payment systems have been developed to detect when a card is being used in an unusual way and raises a red flag at the bank. What makes us think our debit cards have not also advanced where all non-PIN electronic payments are treated the same

Today we have the internet in our hands and are able to video conference with people on the other side of the planet. Payment systems have been developed to detect when a card is being used in an unusual way and raises a red flag at the bank. What makes us think that a debit card transaction (used without the PIN function) is any different than a credit card when routed through the Visa or MC system?

I understand things are a bit different in Canada but the majority of your listeners are Americans. I also understand debit cards won’t have the same protection when a PIN is used, but most won’t bother using PIN numbers because there are already too many passwords and phone numbers to remember.

If my plastic is compromised again I am much happier to work along with my bank, a company that wants to keep my business, than to fight a credit card company on the East Coast who only knows me by my 16 digit card number.

It would be interesting to hear from others who had their debit cards compromised. Maybe you could ask your listeners to send in their experiences and see if I’m just a 3-time anomaly – it’s sure to be a great episode.

Comment on Discussing Money With Your Aging Parents by Steve MoneyPlanSOS Stewart Mon, 07 Apr 2014 04:51:55 +0000 I agree Brian and Bo. Talking to parents about money is difficult, but important. Great list to go through when talking to aging parents about money!

Comment on Be An Advocate For Your Wallet by Peter Mon, 24 Mar 2014 20:38:21 +0000 My insurance carrier seems to have a point of diminishing returns when it comes to raising your deductible. I previous looked into raising my auto insurance deductible and raising my comprehensive from $500 to $1000 was only going to save me about $50/year. I also recently looked into raising my homeowners deductible from $1000 to $2500 and that would also save me only about $50/year. With the homeowners that really makes no sense since I would expect to file a claim more frequently than once in 30 years.

Comment on Be An Advocate For Your Wallet by John Gooch Mon, 24 Mar 2014 12:35:10 +0000 You talked about the importance of starting early for retirement investment. This is common knowledge that bears repeating. It would be great if you occasionally addressed what to do if you started retirement savings in your 40’s or had you retirement savings wiped out late in life because of a medical or other emergency and needed to reboot your retirement savings late in life.

Comment on Homeowners Insurance 101 by ken tye Sun, 19 Jan 2014 23:15:53 +0000 Your homeowners insurance podcast was very informative and well done. Several years ago I had my homeowners and auto insurance with one of the major carriers. I had a homeowners claim for mold damage when they were still covering that damage….the total claim ended up being for more than $150,000…it started as a leak from one of the toilets. All was good until renewal time came and they decided they no longer wanted to insure me…we previously had never had a claim for auto or homeowners before. No other insurance company wanted me either because I had to tell them I had filed a claim within the previous three years. I had to end up getting a policy with Loyd of London which cost me twice as much and which I had to keep for 3 years…

Comment on Car Buying Tips and Tricks by Peter Wed, 09 Oct 2013 20:01:39 +0000 The SINGLE BEST thing you can do to get a good deal on a car (new, used or lease) is to NOT need to buy or lease a car at that moment. If you wait until your current car is on its last legs (or dead) and you need something to get to work on Monday, you are going to get eaten alive because you have no negotiating power. If you can just walk away, go home in the car you drove there and wait for the deal you want, you put all the negotiating power back in your hands. That is the flip side of squeezing every last dime out of the purchase process. Do NOT try to squeeze every last dime out of your current car so that you are in a bad negotiating position for a new one. If you wait too long and let it get to the point where you need to do the deal that day, all the savings of running the current car into the ground is going to get wiped away in the lack of a deal on the new one.

The last 2 cars I bought, I got about 17% off the sticker price. One place eventually refused to sell us the car at that price. We negotiated the whole deal, then we went out to look at the actual car. It had a big scratch on the hood! They said, “No problem, we’ll take that into the body shop and buff it right out.” Three rounds of buffing and me saying “I can still see it. I’m not buying a brand new car with a giant scratch on the hood.” I finally said, “Look, I don’t need this car today. Why don’t you just get me one from another dealer and I’ll come back and pick it up?” They refused, gave us back the title and keys to our trade and sent us home. Either they were just very lazy and didn’t want to do any more work for the sale, or we squeezed them so hard that there was no money in the deal to get it from someone else.

The most recent car we bought, we also got about 17% off the sticker (less than the TrueCar price in our area). Unfortunately, we had a similar problem in that there was something wrong with the actual car they wanted to sell us. We had them get a different one from another dealer and it had 1-2 other features that we ended up getting for free since it would have been extra work for them to remove them. So that ended up working out pretty well.

Brian is right about removing the emotion for the deal. I couldn’t care less about your kids, your story or you as a person. I’m willing to sit in your office all day to get the deal I want. And when you know I don’t have to do this today and I can just go home in car I have, most people will quickly realize they should put a final number on the table so we can either agree and get this done or realize we’re not going to agree and stop wasting everyone’s time. I fell like I am a very good negotiator (probably because I’m pretty cold and unemotional) but lately I’ve gotten to the point of putting out my final offer very early and if they aren’t interested I’ll just leave. As long as I know my offer is reasonable, I know I can find someone to sell it to me at that price.

Comment on One Stop Loan Shop by Brian Preston Tue, 08 Oct 2013 12:43:11 +0000 You got it! Here’s a helpful link:

Comment on One Stop Loan Shop by Joe Dias Mon, 07 Oct 2013 21:03:36 +0000 How does the taxes work with this type of investing. Do we get a 1099?

Comment on Money-Guy Mashup by Steven Thu, 26 Sep 2013 11:29:43 +0000 Brian – You are a nerd. But hey, it stands to reason, if you are getting your “money for nothing”, the checks should be free!!. Love the show.

Comment on One Stop Loan Shop by pascale Sat, 07 Sep 2013 15:05:50 +0000 Good show on Lending Club. I like the premise of the idea and me being the “banker”. I just took $1000 of “fun” money and loaned it out….It will be interesting to see if this matures as a true asset class. I think the idea is fantastic. Great show!

Comment on One Stop Loan Shop by Brian Preston Mon, 19 Aug 2013 14:29:02 +0000 Dusten,

Thanks for the question! The best answer is: it depends. The loan is already on the secondary market for a reason, which means there is a greater likelihood for default. Consider your goals for this money and then determine if the risk/reward trade-off fits. It always comes back to risk/reward, is the risk your taking with this money worth the potential reward?

Thanks for listening! I hope this helps!

Comment on One Stop Loan Shop by Dusten Sun, 18 Aug 2013 16:22:23 +0000 Hey guys!

Thanks for putting on such a great podcast! I find the information you share to be very helpful in understanding the financial world.

I was interested in signing up with Lending Club but they do not support the purchase of notes for my state (AK) and a few others. However, I can buy secondary notes. What is your take on buying secondary notes? Is it worth it?

Keep up the good work!

Comment on Marriage…An Education by David Sun, 16 Jun 2013 03:25:26 +0000 I just listened to your podcast and it was very good. I think you had some good insights, it would be interesting to have Bo’s wife come onto the show and tell her side of things. Thanks for the show, I really look forward to it every two weeks. Keep up the good work.


Comment on Love and Marriage… and Finances (Rewind) by Steve MoneyPlanSOS Stewart Sun, 02 Jun 2013 03:15:04 +0000 It is rare that I will listen to a podcast twice but this is definitely the exception. It’s going to be hard waiting for the follow-up in 2 weeks!

Comment on The Risk of Not Taking Risks by Thomas S. Moore Mon, 27 May 2013 00:36:25 +0000 The problem is that more people would rather buy a car, clothing are just spend money on needless things. I have a few friends that seem to never have money to invest or put in 401ks but the always have the newest tvs etc. Nothing wrong with dollar cost averaging but I always make sure to take some profits and reinvest.

Comment on Building Your Dollar Army by TheeGooch Fri, 19 Apr 2013 19:02:28 +0000 I’m waiting to get out of debt. It will take about 3 more years to pay off my student loans. If the personal business that I’m working on makes money, I’ll be able to go into pure savings mode. In the meantime, I maintain an emergency fund and anything else goes to pay off debt.

Comment on Life Insurance 101 by Melody Thu, 21 Feb 2013 18:10:18 +0000 Thanks!

Comment on Life Insurance 101 by Brian Preston Thu, 21 Feb 2013 13:39:20 +0000 Melody – Great question! The truest answer is that it very much depends on that individual’s specific situation. However, in general terms, you would like to select a term that at least gets your youngest child into adulthood. If that is not a factor, think in terms of “How long do I actually need the protection?” In other words, if you purchase a 20 year term, at the end of that 20 years will you have been able to accumulate enough assets that you essentially become ‘self-insured’? For people under 30, a 30 year term starts to get you pretty close to retirement, and, in most cases, it’s dirt cheap!

I hope this helps!


Comment on Life Insurance 101 by Melody Wed, 20 Feb 2013 22:05:09 +0000 How would you recommend determining what term to select, specifically for an individual under thirty?

Comment on Life Insurance 101 by Shawn Sat, 09 Feb 2013 23:45:43 +0000 Hey guys, love the show, thanks for giving away your really valuable knowledge.

I’m a professional in the healthcare field. Every job I’ve ever had offers some sort of life insurance of accidental death / dismemberment insurance in the benefits package, even for the spouse, and the premiums are very low. I’m assuming the down side is that the insurance goes away if for some reason, health or otherwise, I’d become unemployable. I’d love to hear your thoughts on life insurance through your employer.

Thanks guys, Shawn.

Comment on The Web Vs. Your Financial Advisor by Danny Jensen Wed, 30 Jan 2013 06:10:21 +0000 Brian and Bo,
I just discovered your podcast about 2 months ago. I really enjoyed listening to your January 25, 2013 podcast. I agreed with almost 90% of this podcast. It was really interesting hearing your candid views on index investing and the value added you provide as financial advisors. It seemed that you favor passive investment for the “core” part of your portfolio and for the smaller cap, emerging markets or international investments you prefer active management. I’m a fan of indexing because I think it is almost impossible to pick tomorrow’s top performing actively managed funds.

It was great hearing Brian talk about his 75,000 portfolio clients in years past. It would be great if you did a show picking some 60% Stock 40% randomly selected portfolio’s you were recommending 15 years ago and seeing how they stack up to the following porfolio at:

If possible, it would also be interesting if you would calculate the compounded annual return and standard deviation of your 60/40 portfolios to see the value added for active managment.

Danny Jensen

Comment on Money Truths and Financial Life Lessons from the Money Guys by Phung Vo Thu, 03 Jan 2013 16:11:57 +0000 Wow, I really misunderstood your minimums – I assumed it was $250K – looks like I am WAY off for your services.

I will continue listening and hopefully learn as much as I can to reach this!

Comment on Money Truths and Financial Life Lessons from the Money Guys by Rob Sun, 30 Dec 2012 14:59:07 +0000 I’ve been listening since day one, and that was your best show yet. Well done, and thanks.

Comment on End of Year Tax Planning by David Patterson Tue, 04 Dec 2012 17:09:59 +0000 Long time listener with a question about last podcast. Have yet to use but have investigated donor advised funds. Fidelity and Vanguard look pretty similar. Just curious as to why you favor Fidelity? Is there some aspect such as specifics of how it works, ease of access, or fees that makes you favor Fidelity?

Unrelated items but as long as I am writing:
1. Do you ever recommend life insurance that is not “term”. I have relatively high income and max out every retirement option, fund 529s for kids, etc. so as another option my wife and I both have VUL policies. Seems very expensive but supposedly some advantages that may get better in regards to “tax free growth” and utilizing “loans” for additional retirement income and it is supposedly a “protected” asset which has appeal as a physician.

2. Since you have done shows on the topic, a comment on taxes. Why not make income taxes just that, a tax on income and nothing more. Take all your income regardless of source (active, passive, W2, dividends, capital gains, etc.) and simply pay a percentage with some progressive scale. No deductions, credits, exemptions, etc. All the rates adjusted lower (experts can figure out exact amount). No games/politics, no lobbyists, no CPAs (sorry). Simple and fair (still progressive).

Comment on Best Brokers and Retirement Rules of Thumb by Rick Francis Fri, 26 Oct 2012 20:13:15 +0000 I’ve used both E-trade and TD Ameritrade.

I have found customer service similar for both companies but haven’t used it much for either.

Etrade’s fees are usually $9.99/trade but can be as high as $19.99- I pay that for transactions for my company’s stock options or ESPP shares.

TD Ameritrade also has $9.99 trade fees, but they have a great selection of no commisiion ETFs, including many vanguard index funds:

Using TD ameritrade’s commision free ETFs allows me invest a small amount monthly without getting clobbered by transaction fees, and the vanguard funds have very small
expense raitos so my overall investing costs are very low with TD ameritrade. TD ameritrade also had no inital minimum to open the account so anyone could start monthly investing this way.

-Rick Francis

Comment on Addicted to Saving by Brian Preston Mon, 01 Oct 2012 13:11:59 +0000 Phung,

We would recommend looking to a large firm like Vanguard, Fidelity, or Charles Schwab. I hope this helps!


Comment on Addicted to Saving by Phung Vo Fri, 28 Sep 2012 20:19:24 +0000 Hi Brian & Bo!

Thanks for this! I have a 18 month old and expecting another child. Can you tell me is there any investment firms that would allow me to automatic investment with no fee for something like $50 dollars a month?


Comment on Setting Yourself Up For Success by Oscar Perez Sat, 01 Sep 2012 03:53:27 +0000 Bo,
Great show and topic. Learned a lot from this one. I like the fact that you commented that all these patterns are not hereditary, but can be learned. I only have one gripe with one of your comments. Perhaps you can provide a rebuttal. You mentioned in the section about consolidating your assets where if you have an old 401k with a company you no longer work for you can transfer it to your new companies 401k.
I almost made the mistake of doing this as I recently switched jobs. The more I researched it and thought about it, I can find no benefit to rolling over your 401k to another 401k. You will in essence be locking up your funds and limiting yourself to the new plan providers pathetic options. It would be better to roll it over to an IRA (which you did mention). This would allow you more flexibility. Do you find any benefit in rolling over to a new 401K? Now I’m off to give you positive comments on iTunes! Keep up the grass roots movement.
P.S. How about a show about self-directed IRAs?


Comment on 2nd Quarter Wrap-Up by Peter Wed, 25 Jul 2012 22:32:21 +0000 Not to drag out the tipping thing too much further, but I wanted to make 2 comments about Jason’s email.

1 – I live in eastern Pennsylvania so I can comment directly on the New Jersey gas situation. I definitely never tip the attendant because now that the pumps all have the built in credit card reader all they are doing is swiping your card and filling the tank. Plus, I’d be more than happy to do it myself but you simply aren’t allowed. They actually don’t even like you to get out of the car.
You also mention NJ drivers paying a “penalty” for this service. Actually because of the high gas taxes in Pennsylvania, gas is cheaper in NJ than in PA even though they are paying the employee to pump it , so it’s always great when you have to travel to NJ and can get cheap gas.

2 – Jason also mentions that he always tips restaurant servers because they start out at a lower wage. I know that restaurant tipping is a hotly debated issue, but I will point out that at least here in Pennsylvania, restaurant employers are allowed to pay servers less than minimum wage with the expectation that they will make up the difference in tips. However, if the server does NOT make up the difference in tips, the employer is REQUIRED to raise the employee’s rate so that they make at least minimum wage. So every server is going to make minimum wage either through customer tips or through the employer making up the difference. I’m not discounting the difficulty of being a server or pointing this out as an excuse to leave a bad tip, but depending on where you live, the idea that servers are getting paid nothing and require your tips to survive may or may not be true. ( See item#3)

Comment on Tipping Tips by Mike Wed, 25 Jul 2012 14:08:41 +0000 Brian,
I wanted to clear up a the misconception of Pizza Delivery Fees and why they are charged. Due to government regulations, QSR delivery restaurants are required to carry a high cost primary insurance for their delivery drivers. Drivers also have to carry their on insurance as a secondary rider, if you will. Double dip for the insurance industry. This is another government regulations, tax really, on small business that has to be passed on to the consumer. Yet, once again, people feel its a sneaky business practice or a money grab.

Business continually gets demonized in this country. When are people going to realize that government is what is driving cost increases and making it difficult to make money and ultimately hire people. So, the next time a emailer to your show accuses an industry of have poor business ethics, he might want to look a little deeper in the cost of doing business. He can thank Uncle Sam for it . Don’t cheat your drivers, who is just trying to make a living.

Also consider that it is more ethically to have it as an add on. If the fee was bundled into the cost of product everyone would have to pay.
When you competing with the likes of Little Caesars, who doesn’t deliver, that would be business suicide. It’s a add on service and a convenience fee. Like Bo said, you can always pick up you pie.

By the way drivers do get a small portion of the fee, 15% or so. Depending the the business.

Love the show, keep it up!


Comment on Mortgage Rates, Refinancing, and Everything Real Estate by Bill Fri, 13 Jul 2012 17:45:57 +0000 Brian,

Enjoyed your podcast on mortgage refinancing. You mentioned that you might put the apples-to-apples breakeven calculator on the website. We’re about to refi and that would sure be helpful. Thanks.

Comment on Mortgage Rates, Refinancing, and Everything Real Estate by Brian Preston Thu, 12 Jul 2012 13:16:29 +0000 Gerry,

Great question! The answer depends on how much of a ‘super saver’ you want to be. I advise people to try to get to that 15% – 20% without the employer contributions. If, however, you need that little bump to get you to that threshold, you’re still doing great!


Comment on Mortgage Rates, Refinancing, and Everything Real Estate by Gerry Wed, 11 Jul 2012 16:00:31 +0000 Hi Brian,

Great show as always. During the episode you mentioned that you feel people should be saving 15% to 20% of their gross income. Do you include or exclude employer contributions to retirement accounts when making this calculation.


Comment on Mortgage Rates, Refinancing, and Everything Real Estate by Stephen Brock Mon, 09 Jul 2012 16:23:49 +0000 Hey Brian and Bo,

I just listened to the podcast. I know that you were noting that GMAC “renamed” themselves. Are you aware that the “renaming” is a result of them filing for bankruptcy? My sister has her mortgage with them, and she received her notice that they declared bankruptcy.

Also, she is someone who had been trying to take advantage of the TARP monies and other programs that are available to homeowners underwater. GMAC has provided four seperate options for her – three of those options were going to require her to pay MORE than her current payment and the other was a reduction of $35/month. She’s done a lot of investigation into them as a result of her situation, and apparently they pretty sketchy. She knows that since they have “offered” her a new payment oiption (technically, though asking her to pay more is really the intent of HAMP or the other programs) it has been reported to the Fed Gov’t each time. Thus they appear to be doing the right thing, but that is only because banks have to report modifications “offered.” The change in payment isn’t required to be reported, so the fact that the “modification” requires borrowers to pay more never gets reported.

Also, her lawyer has been in touch with them to get their formula for making modifications. They refuse to provide a formula, and seeing as each modification has been different despite the facts, income, etc. not changing implies that they have no formula (which they are supposed to).

That type of behavior isn’t usually limited to one department, so you have to think that the rest of their departments are probably acting in similar fashion.

Anyway, just wanted to point out that GMAC is less than reputable and in bankruptcy since you noted them by name in your podcast.


Comment on Timeless Tips and Tax Advice by Susan Sun, 01 Jul 2012 21:55:29 +0000 Great show Brian and Congratulations to Bo (and his wife)! I’ve been listening to your podcasts for several years and Bo is a great asset. Gives me hope for the future. Even though you guys have a lifestyle about as similar to me as night and day you do a great job and I really enjoy listening to the show (makes my time on the exercise machines go really fast).

Since some of us were good about saving, retired according to plan and are now witnessing a rapidly changing situation, would you consider devoting a few shows to us retirees and what we can do? I planned, saved, retired from a job I hated and followed through but now, three years later, find things are not going as planned. I know I am nothing special and a lot of others are in the same boat. I know we have to be flexible but what should I be paying attention to?

Last winter, on a whim, I cashed in an investment account (which hadn’t done much) and bought a small winter home in a warmer climate (which, so far, has turned out to be worthwhile – both for lifestyle and investment) but there are expenses with it and I don’t know if I will be able to keep up in a few years. And I will probably not want to stay there the rest of my retired life. I work to stay healthy and active and do volunteer work but I do not want to go back to a job if at all possible. I have two old vehicles, which I keep functioning, gym memberships, lots of great friends, family and interests but, unlike you guys, I never eat out, don’t really “go on vacation” and really don’t spend that much money – I seem to do okay with expenses within my pension.

My current interest is restoring old books and bookbinding. I would like to get more training and perhaps do it for a tiny bit of income in the future (yes, some of us are still into non-electronic media) but my retirement savings investment back-up is not doing too well. What to do?

Thanks. Susan

Comment on Protecting Your Identity by Peter Fri, 01 Jun 2012 00:44:02 +0000 Great information, but I would have liked to see you make a clearer distinction between true “identity theft” and regular old “credit card fraud.” Too many people think run-of-the-mill credit card fraud is the same as identity theft and it really isn’t. You even mention in the podcast that something like 50% of all the “identity theft” cases were actually just credit card fraud.

Someone stealing your credit card information and using it to make fraudulent purchases is just regular credit card fraud. You see the fraudulent purchases on your statement, you call the card issuer and dispute them, they close that account and send you a new card, end of story. No personal information has been obtained by the criminal. Contrary to Steve’s post, I have never had any problems whatsoever disputing charges with my credit card issuer and having them promptly remove the fraudulent charges issue new cards. I have had to do this a handful of times with different card issuers over the years and never had any problems.

Identity theft involves the use of your personal information, social security number, driver’s license number, name, address and other such information to impersonate you and conduct other fraudulent activities. True identity theft is far more difficult and time consuming to deal with than credit card fraud.

I agree with Brian about being skeptical of debit cards. I only have one because my bank only issues combination ATM/debit cards. They will not issue just an ATM card. One thing you can do with a debit card to protect yourself is to lower the limits on the card. Lower your purchase limit to something in the $100-200 range and then a criminal will have a much harder time cleaning out your bank account. Like Brian, I still prefer credit cards because the criminal isn’t directly taking money from my account. With a credit card, you’re not out any money right away, you have all the time between when the statement arrives and the bill is due to deal with it. With a debit card you are out the money first and have to work to convince the back to get it back. Plus, credit cards offer rewards, warranty extensions and other benefits that you just don’t get with debit cards.

Comment on Protecting Your Identity by Brian Preston Tue, 29 May 2012 14:50:55 +0000 Steve,

Thanks so much for sharing your experience. It sounds like your banks treated you similar to the way my credit card company treated me. I think the moral is that, whether you use your debit card or your credit card, if you are a good customer, your vendors will do what it takes to keep you happy. Thanks again for sharing.


Comment on Protecting Your Identity by Steve MoneyPlanSOS Stewart Tue, 29 May 2012 03:19:07 +0000 I would like to offer you some real-life experience about charge card theft to further educate your readers/listeners about the benefits of Debit Cards over Credit Cards. My wife and I are very cautious with our Debit Card use, both online and offline. Last year we had 3 Debit Cards from 2 different banks be compromised in a 12 month period. We also have a member in our family whose Credit Card was compromised a month ago, so I can attest to their experience with dealing with a Credit Card company.

#1: My personal Debit Card – Someone used my Debit Card number in a store on the West Coast for a small amount. The thief knew they had a good card when it went through so they went and paid for a $565 room at Caesar’s Palace. My bank contacted me within 1 hour of the transaction, we confirmed that the charges were not ours, and they sent me an official letter to sign. Because my Debit Card was never used in the Debit Function (requires a PIN) we were not liable. The false charges were quickly erased and it cost me about 20 minutes on the phone, a stamp, and an envelope. That’s it.

#2: My business Debit Card – similar to my personal card but with another bank, this card was used at a convenience store on the East Coast for $7.50. When it went through the thieves racked up 3 more transactions of more than $600 before that bank reached me and we shut the card down. I still had full access to the account that day, just not my plastic Debit Card. No money was actually removed, the charges reversed, and it cost me about 15 minutes on the phone and $4.00 in faxes.

#3: My wife’s personal Debit Card – Somebody had actually produced a swipe card with her card’s number in the magnetic strip. It was used at a gas station 50 miles from our house at 1:00am on a Saturday morning after Christmas – for $58.00 of DIESEL GASOLINE. I can promise you that she wasn’t outside in the middle of a cold winter night pumping diesel! The charge was reversed the next business day. She spent about 10 minutes on the phone and it cost us a stamp and envelope to mail the complaint forms.

#4: Family Member’s Credit Card (we’ll call her Sue) – Same scenario: A small charge followed by a few larger ones. However, Sue never received a phone call from the bank and the charges were only discovered because she had looked at her statement. She promptly called her Credit Card company to report the problem and THEY WERE NOT WILLING TO REVERSE THE CHARGES. She then called the phone number associated with the fraudulent charges and they claimed the charges were authorized, even though she had never dealt with the company before. It took a number of calls and another week before the stupid Credit Card company sent her the forms to begin the investigation. BTW: She had to pay for the fraudulent charges or be charged interest because they would not reverse the charges before the next billing cycle.

ALL Visa and Master Cards have Zero Liability Protection against unauthorized charges when used in the Credit Function, whether they are Debit or Credit cards. Our banks, who wanted to keep us as customers, were very easy to work with. The story from our family member’s experience is just one more reason why I won’t ever have a Credit Card – they really didn’t care about her standing as a good customer.

Comment on Facebook IPO Friend Request…Should You Accept? by Peter Tue, 15 May 2012 21:01:59 +0000 I was actually able to get in on an IPO and it went pretty much exactly as you described. Back in the late 90s our mortgage was held by a small local mutual bank (meaning the depositors were the owners). The bank decided to go public and as small account holders (since we were primarily borrowing money) we were second or third in line behind the the larger depositors. We did get shares at the offering price of $10 on opening day. I can’t remember if there was an sort of pop on day one, but after that it slowly slid down to $9.75-9.50 for a few months. It did throw off some dividends but the stock price was going nowhere. After about 6 months it finally clawed it’s way back up to $10 and I sold it. With the dividends, commissions and other fees, I think I made $5 on the whole deal.

It was fun and exciting to be part of it, but as a way of making “quick money” it was a suckers game. Only people who can get in and out of the market very quickly with a lot of money, can work an IPO to their advantage like that. At some point in the future the bank got bought by another bank and then they got bought again by another bank, so who knows, holding on to it might have made it worth something now.

Comment on Love and Marriage…and Finances by Peter Fri, 04 May 2012 01:18:32 +0000 Great show. I remember one of the best financial things about getting married was the sudden influx of money. I was used to just my salary and now there was TWICE as much money coming in! It was awesome. I’m very glad we didn’t get carried away and start spending it all. We never kept a specific budget, but we did track where money went and I would produce a net worth statement each year. As with all investing, it starts out slow, but after 8-10 years you wake up one day and realize “Hey, it’s really working.” Then you reach the point, like Brian said, where there are enough assets that you don’t have to budget for every little thing any more. As long as you continue to save enough, what you do with the rest is kind of irrelevant. You reach the point where money issues don’t keep you up at night, and that is once of the best feelings you can imagine.

Two financial things I would recommend to young couples that I don’t think you touched on.
1 – Get a basic will made up. No one wants to think about dying right after they get married, but spending an evening with a lawyer and getting a basic will drawn up will save the survivor a lot of headaches should the worst happen. You might also want to consider a living will/healthcare power of attorney since statistically, you are actually more likely to be seriously injured or disabled than you are to be killed. Make sure to update them if children come along.
2 – On a related note, get some life insurance. If one of you were to pass away, there may not be enough assets early on to keep paying the bills and the survivor might not be able to, or want to, go back to work right away. Having that cushion provides great peace of mind. Also, insurance is dirt cheap for healthy, young people. Again, make sure to check there is enough insurance once children need to be provided for.

We’ve been married for 20 years and, like all marriages, there have been ups and downs, but overall, if you marry the right person for you, it is the most amazing and satisfying way to spend your life. Knowing there is someone out there who loves you unconditionally and will always be there for you to help you through anything that comes along and to share all the joys in both your lives is a very, very wonderful feeling and can make you feel stronger and more secure as a person because you know there is someone out there who will always take care of you. And you get to wake up next to this person every morning and think “I can’t believe I get to spend my life with my best friend.” You spend enough time with someone and it gets easy to start taking each other for granted and to not continue to show the love, respect and caring that brought you together, but you have to fight it and work to keep those early sparks alive. It keeps you feeling young and reminds you why you got married in the first place. When they speak of marriage being hard, I think this is one of the key things. Don’t let the day-to-day routine of life make you stop thinking and caring about each other. Keep doing little things for each other to make the other one smile and show them you care.

Being married really is an awesome feeling, and I wouldn’t trade it for anything.
Congratulations and best wishes to you, Bo.

Comment on Love and Marriage…and Finances by Keith and Kinsey Sun, 29 Apr 2012 14:10:29 +0000 Great info guys! This is a topic that’s near and dear to us. We use to fight a lot about money. The key for the turn around was managing money TOGETHER. In our opinion all financial decisions should be made together in a marriage. I don’t want to hi-jack Brian’s blog, but if you don’t mind sharing our blog post, here’s more on our views:

Comment on Above-Average Shopping and Investing by Peter Fri, 27 Apr 2012 00:03:52 +0000 Sorry for the name misspelling.

Comment on Above-Average Shopping and Investing by Peter Wed, 25 Apr 2012 21:28:12 +0000 Great, now I have this image in my head of Bryan driving around in his tricked-out Jeep with a winch on the front, blasting Phantom of the Opera.
Thanks 😉

Comment on How to Win Life’s Lottery by Rick Francis Tue, 03 Apr 2012 23:28:11 +0000 Brain,

I just finished listening to the podcast- I too bought a single ticket- dreaming of a half billion.

The last time I played the lottery was in college when I bought a ticket for a jackpot of around a hundred million. I didn’t win that one either so that makes $2 over twenty years. In contrast last month I invested about $2000 in stocks, bonds, real estate (via a REIT). I think that is a reasonable ratio. I’m working toward making my own jackpot, and while I’m not counting on $5 million – I would be pretty close if I really could get a 10% compount annual growth rate going forward.

-Rick Francis

Comment on “American Exceptionalism”: Voices From the Past by Josh Scott Thu, 21 Oct 2010 03:39:13 +0000 Justin,

As a fellow Brian Preston follower and the only other one to comment on the American Exceptionalism podcast I found your blog entry very interesting although I couldn’t disagree with you more. I’ll preface by stating I am an ultra conservative, Dave Ramsey zealot, free market loving, capitalist. And while I knew I was going to disagree with the majority of your statements after reading just the first few paragraphs, I found myself drawn into your blog further. You are well spoken, articulate your words quite nicely, sound fairly well educated, and have a unique writing style that captivates and sustains your audiences’ attention…..which is why I was sorely disappointed to find the bulk of your argument hinged upon what I like to call the “poor victim” argument. You state:
“What Friedman deliberately ignores, and what Preston likely just fails to consider is that the system is stacked against a lot of people. The vast majority of them aren’t rule-breakers at all; they’re people who were never given the chance to do better for themselves, and worse yet were never even told how they might try to do better for themselves. By providing his services as a free podcast, Preston crusades against financial illiteracy. But there are millions of Americans who don’t even realize that they lack financial literacy; they assume that being tens of thousands of dollars in debt is just part of being an American, or worse, they’re resigned to the notion that there’s no way to come back from such difficulties in today’s America.”
Then pick up a book or two at your local library instead of the Playstation or Xbox and educate yourself for Pete’s sake. I mean seriously? People need to be TOLD that borrowing money you don’t have and going into debt up to your eyeballs is probably not the best idea? That saving some money and setting it back for retirement someday might be prudent rather than relying on mommy and daddy government to do it for you? That buying a $500,000 home when you make $40,000 a year might not be wise? Common sense needs to enter here at some point. This is not rocket science. The general notions are there and the nitty, gritty details can be researched and studied by reading or taking classes/seminars or consulting professionals or…..listening to podcasts. I’m sorry, I just don’t buy the “I was never taught that so therefore I can’t be held accountable” excuses. They’re lame and the lazy way out. And yes, Justin, the rule-breakers are out there too. I can’t tell you how many times I’ve seen food stamps used while talking on an iPhone that was pulled from a Coach purse. Do not be fooled, if there are ever ways to “abuse the system”… will be abused.
“In that context, doesn’t it seem fair for the government to ask those who have succeeded to help out those who have been dealt an unfair hand? Perhaps we, the lucky members of the waning middle class, have benefited from their hardships in some way, and could stand to let them have a small percentage of the healthy income that we earn while they struggle to get by? (Side note: I refer to myself as a member of the middle class here because I’m still new to my near-poverty, having moved less than a decade ago from my parents’ reasonably well-to-do household. Anyway, on with the rambling…)”
No, that’s what charities are for…..for the needy. Lucky you say? Nay, I say blood, sweat, and hard work that’s paid off. Going to school for 8 years to be a doctor in order to make a generous income is not “lucky”. And exactly how have “we” benefited from those “dealt an unfair hand”? You fail to provide any specific examples. I’m so tired of the jealousy and envy that plague this country. Rather than work hard to make yourself better and put yourself into a better situation, you want to take from those that have and call it fair and just by means of government. Drag others down instead of lifting yourself up. It’s legalized stealing. I want what you have and I know I’ll never have what you have therefore I don’t want you to have what you have and I’m going to take it from you. It’s not a fruit of the spirit.

To conclude Justin, I think you need to take a closer look at reality. Try to see past the smoke screens that have been placed before you and perhaps be a little more cynical when judging the character of others. While we all wish to see the best in people and want to believe the best of intentions are always present, often times in actuality what you find inside might be a little darker and ominous than expected. The human heart is easily corruptible and while these social programs might have been created initially with honorable and worthy intentions, they quickly circum to the will of those that wish to defraud it.


Comment on “American Exceptionalism”: Voices From the Past by Justin Tue, 28 Sep 2010 08:06:23 +0000 Brian,

I’m a big fan of the show, but I took issue with this episode (evident from the fact that I just finished writing and posting my criticisms on my blog at 3am). If you’re interested, I rambled about it for some time at

Anyway, in spite of my criticisms, I’d like to say thanks for all the information you’ve offered me over the last year or so. Hope all is well with you, and look forward to the next show!


Comment on “American Exceptionalism”: Voices From the Past by Josh Scott Sat, 25 Sep 2010 21:33:53 +0000 Brian,

Great podcast and thanks so much for the book referral! I can’t wait to get my hands on a copy, it sounds fascinating. It’s nice knowing there are other “squares” out there who are tired of being punished and pushed around for doing the right thing. It’s frustrating. We live in a society that establishes rules and social programs with good intentions but the reality is they encourage laziness and destroy incentive. We should be rewarded for saving, planning for retirement, paying our mortgages on time, not cheating on our taxes,…… but instead we suffer while those who did not reap the benefits and rewards. Spent too much on a credit card and got $100,000 in debt? No problem, just file bankruptcy and we’ll wipe the slate clean. Keep all the stuff as our gift. Bought a house you shouldn’t have and now it’s getting ready to be foreclosed on? No problem, here are all these government programs to help you out at others’ expense. Oh, and those of you that DID pay your mortgage on time, sorry, there’s no help for you. Can’t refinance because the value of your home has declined? Sorry, just keep up the payments, thanks. We only help those who are behind and in foreclosure refinance.

*sigh* The grasshopper and the ant story always come to mind. Be square, save well, plan ahead, don’t cheat, and adhere to the terms of contracts you sign and you’ll be punished. Cheat, cut corners, steal, lie on tax forms, spend money you don’t have, don’t pay your bills, spend now and save nothing and you’ll be rewarded. After all, you’re just a poor victim…..

Comment on Creative Ways to Save a Few Bucks by Bradley Martin Fri, 03 Sep 2010 23:04:00 +0000 Enjoy Dragon Con………and the traffic! Did i mention GO GATORS!! I don’t follow NASCAR. I live up on the northeastern side of Henry County (near Union Grove High School and Shane’s Rib Shack). So no traffic for me!! I loved the podcast. I also think the article on Index Funds was excellent!!

Comment on Prevent Your Car Accident from Becoming a Wreck by Scott Wed, 18 Aug 2010 03:05:09 +0000 Brian, Bo, and all Money-Guy listeners,

Great shows guys. I always pick up good tips. I’ve been a long time listener (~3yrs).
I’ve been using American Express Blue Cash. It’s been a pretty good deal. It gives you unlimited 5% cash back on Gas, Groceries, and Drug Store purchases. All other purchases are 1.25%. The catch is the first $6500 of annual purchases the percentages are less, 1% and 0.5%, respectively. The Fidelity card with a flat 2% on everything may yield a higher reward. I’m going to run my numbers to see.

Rob’s thought about cash savings instead of credit has crossed by mind too. One definitely needs to be mindful of their spending.

I know you are all sad about losing Bing Cashback, but Ebates is giving cash back on what seems like every online store. Plus, they’ll give you $5 cash or a $10 gift card for signing up. It’s up to 25% off. If you buy online you need to check it out.

They send out checks quarterly. I just received my first check.


Comment on Prevent Your Car Accident from Becoming a Wreck by Rob Wed, 11 Aug 2010 20:59:00 +0000 Brian (and Bo),

I’m interested to learn your opinions on this since you are privy to many people’s detailed spending habits.

How much credence do you give to the studies showing that people spend more with plastic than with cash? Even if it is paid off every month, I bet that most spend more on their rewards card than they would’ve had they spent actual greenbacks.

Just my opinion, but I’d argue that a much higher percentage of consumers (even the cream of the crop who listen to this show and should know better) are doing more financial harm than good by using these rewards cards. For someone who charges 100K to a 2% cash back rewards card will only receive 2K back in rewards on a yearly basis, not counting the yearly fee that may apply.

There is no doubt in my mind that this same person could’ve netted that 2K (and then some) during that 100K worth of transactions by either A) negotiating with cash, B) delaying the purchase, or C) deciding they really didn’t need the item anyway.

In general, though, would you agree that your cash or cash equivalent (i.e., debit cards) clients and/or friends are more frugal, patient, and deliberate about their purchases than those who use rewards cards? And, if so, would you say that having patience and discipline as a part of your financial personality is worth more, the same, or less than 2% per year?

Great, thought provoking podcast, as always.


Comment on Prevent Your Car Accident from Becoming a Wreck by David Raccah Tue, 10 Aug 2010 21:19:53 +0000 Hey Brian and Bo,

My opinion is the same as yours about the credit card rewards. Here is a link of a great overview of all of this issue:

Also, I love the Chase Freedom Plus card which gives me 3% back in 6 categories! We love the card!!! Yes we pay 20 bucks a year for the card, but it is great. I would love to use the Amex card, but it is hard to use in many places. Visa rocks. I use the free Amex for gas to get back 5% on all gas purchases.


Comment on Taxes, They Are A-Changin’ by David Raccah Tue, 10 Aug 2010 19:34:16 +0000 Loved the podcast Brian. Yes it was CGMFX, the standard deviation between CGMFX’s return and investor’s return was all over the blog-sphere. I got burned on it as well.

Thanks so much!

Comment on Taxes, They Are A-Changin’ by Donovan Sexton Wed, 04 Aug 2010 19:39:03 +0000 Liked the show and thought of a simple calculator I found on one of my tax blogs that I thought might be good for those who peruse your site.

To throw in an extra item… I know you have limited time to cover a large topic like tax changes, but I was surprised to not hear more about the S-Corp tax change. In my opinion this will only hurt small S-Corps who are meeting the current reasonable wage test. I have clients this will touch and agree that some tax advisors take a rather strong stance on what reasonable wage means for S-Corp; however, I think this law change is something IRS will find even harder to enforce than the current law. Why not simply provide the IRS with the expenses slated for this change to the reasonable wage law already in place in order to oblige more to voluntarily compliance.

Like my post said last month… glad to be back on board with your podcast.

Comment on How Well Do You Know Indexed Annuities? by Brian Preston Wed, 28 Jul 2010 15:31:07 +0000 Kraig,

Thank you so much for your comment! The counter argument that I would make is, typically, annuities make sense for individuals who have exhausted all other forms of tax-incented savings (i.e. maxing out employer retirement plans, IRAs, etc.). In your example, you are comparing using a tax-deferred vehicle (the annuity) versus a taxable investment account. In order to do a true apples-to-apples comparison, you would need to use a tax deferred vehicle such as an IRA, 401k, 403b, etc. Once you do this, the current Federal/State/Capital Gains taxes no longer come in to play. Thanks again for your comment!

Comment on How Well Do You Know Indexed Annuities? by Kraig Strom, CFP Tue, 27 Jul 2010 14:10:44 +0000 Your numbers are clearly biased towards the mutual funds. When you consider a .50% management fee and taxes (25% fed/state and 15% CG) on the investment growth, the actual return is 5.74 for the stock market. the actual for the annuity is 5.53%. Working with us is not free and mutual funds average around 1% annual fee. If the total annual fee (funds + CFP) is 1.5% and cap gains go up to 20%, the actual return from the market is only 4.31% using the time period you are quoting.

Although, I am not always pro – annuity, I thinks its important for clients to understand the details behind the details.

Comment on Start Early and Stay Ahead by Donovan Sexton Tue, 20 Jul 2010 17:46:43 +0000 I got away from your podcasts for a while, but a friend brought me back in and I’m impressed to see how much your shows have matured while I’ve been gone. I’ve done a marathon of some of the recent shows and your show is now back on my RSS Feeds.

The reason for my post is I thought this was a great show, but I’d like to highlight something I felt was missing from the show. I am a fellow CPA Financial Planner who now lives in Chicago and I would like to first say you did a great job Bo. The only thing I thought could have been highlighted more was the risk of Disability to people of our younger age. Not only how important it is to get the group stuff many employers provide, but to also talk about the risks of the group plans and their tax issues. For me, this highlights why it’s a good idea to fully look into the risk of disability. I bring it up because I was surprised to see you jump to Life Insurance before you covered disability for younger people.

Don’t want to write a novel so I’ll end it with that, but good show Bo and I know you can’t please everyone all the time. You did a great job with the time frame and subject matter covered, but I felt a small touch on Disability for your listeners who may not know the dangers of disability would have topped off the discussion.

Comment on Start Early and Stay Ahead by Peter Mon, 19 Jul 2010 20:38:01 +0000 That was a fabulous podcast. Thank you Brian for letting Bo out on his own.
I appreciate Brian’s more analytical topics, but it is nice to have some shows that focus on real practical suggestions.

I have to completely agree with just about everything Bo said. It is impossible to understate the importance of starting early. My wife and I started saving right after we got married and have continued to do so ever since. It was slow going at first since you are still accumulating, but one day you look at the portfolio statement and it’s hundreds of thousands of dollars. It’s an unbelievably comforting feeling knowing that you can deal with just about any problem that comes along without worrying about how you are going to pay for it.

I would also second Bo’s comment about the importance of health insurance. Things can happen to a perfectly healthy person that are completely out of their control. Last year I was bit by a bug and developed a skin infection on my foot. It ended up requiring a heavy dose of antibiotics and a short stay in the hospital. I would not be surprised if that would have cost more than $10,000 without health insurance. There is no way you could have predicted something like that happening and a simple problem like that could devastate a young person’s finances.

Keep up the good work and please let Bo do more of these types of shows. Thanks.

Comment on Start Early and Stay Ahead by Brad Fri, 09 Jul 2010 20:53:07 +0000 Absolutely great podcast that provided just the right amount of coverage to each area of personal finance for those in their 20’s or early 30’s…. I am 26 and almost 100% agree with everything said. I’ll be forwarding to my 22 and 28 year old siblings. Thanks again!

Comment on In Case of Emergency… Listen to This! by Peter Tue, 15 Jun 2010 17:58:32 +0000 You mention that dividend yields have gone up even though the market itself was flat. Isn’t that just a product of inflation? If a company was paying out $1/share in dividends 10 years ago and is still paying $1/share today, the purchasing power of that $1 has been eroded by inflation and is worth much less. The company would almost be forced to raise the actual dividend over that time period in order to keep up with inflation.

Also, you briefly mentioned something I always think about when people discuss the whole “If you missed 10 best days in the market…” in respect to market timing. I always think “What if you missed the 10 worst days?” You briefly mentioned that and wrote it off as unrealistic. I do agree with you that staying the course is a better choice, but do you have any numbers on what returns would be if you missed the bad days?

Comment on “Those Who Spend Too Much Will Eventually Be Owned by Those Who Are Thrifty” by Gerry Mon, 14 Jun 2010 17:48:16 +0000 Hi Brian,

Love the podcast. I’m a little confussed on the debt to gdp numbers. I just saw a cnbc slide show on the biggest debtor nations which gives very different numbers. Here is the link
According to this list, the US is #20 on the list with a debt to gdp of 96.5%. Ireland is #1 with a debt to gdp ratio of a whopping 1312%. Maybe I’m missing something simple. What do you think?


Comment on In Case of Emergency… Listen to This! by J David Lewis Thu, 03 Jun 2010 20:50:36 +0000 Brian, I thought you might like to see what I wrote about the Davis talk after I got home.


Comment on Don’t Let Buying a Car Drive You Crazy by David Hutton Mon, 31 May 2010 16:53:43 +0000 Well I am one that only buys a car every 10 year or so. My current car is a 2003 that I purchased new and has just over 100,000 miles on it. I might keep it another 7 years!! Everyone says you can save money by buying a used car but I find that I can commoditize a new car and can negotiate better for it than a used car. I would agree with you on your podcast except for a couple of things.

1. Know what you want. – I would agree with this. Go around and test drive and check out the different models and see what you like and don’t like.

2. Once you know what you want you can use the web to find all of the dealerships that sell the type of car you want. For example I purchased a Honda Accord and I obtained the Name and FAX numbers for all the dealerships that I was willing to drive – I figured I could drive up to 200 miles for a deal.

3. I sent a FAX to all of the dealerships telling them the make and model that I wanted down to the floor mats. I directed them to send their price (that being a drive off the lot price to include any dealer/handling fees) to a email address. Once I got replies from all of them, I responded to all of thanking them for their prices but that I had obtained a lower price and telling them what I had been bid. A couple responded back with even lower prices.

4. I took the lowest price and since I am a AAA member I called their car buying service. I understand that there are warehouse clubs with the same service that you can check out. He gave me a price and when I told him I had already beat that price he did some homework and was able to beat it by $50. Not much but everything helps. AAA also has a service where you can pick up the car from the AAA office rather than the dealership.

I have done this FAX pricing a couple of times, I find that these often get sent to the fleet manager and that is where you are going to get the best price. I came across the site and he wrote a book that is out of print but I found it at my local library – Car buyer’s and leaser’s negotiating bible W. James Bragg ISBN 0375720677 where he talks about what he calls the FAX attack. Doing about the same thing as what I did. I think that the book is out of print but check your library.

Using the FAX and email allows for you to negotiate without emotional involvement. It also eliminates the annoying phone calls. I agree that you should have your financing lined up before you go. I had an interest rate from my credit union but I choose the dealer financing because at the time Honda was doing a lower interest rate special.

From time to time I stop at a dealership lot but I really get annoyed at the games that they play. I like being able to stand back and just let them bid on the price that they are going to sell me the car for. It puts me in control not them.

Have fun.


Comment on “Those Who Spend Too Much Will Eventually Be Owned by Those Who Are Thrifty” by Nick Bell Tue, 18 May 2010 08:04:27 +0000 Brian-
The author’s you mentioned ‘Jason Zweig’ is also the author of one of the most fastening investing books I’ve ever read “Your Money and Your Brain” ( I know you’d love it.

Neuroeconomics is like investing dessert for us investor geek types. Give it a shot.


Comment on “Those Who Spend Too Much Will Eventually Be Owned by Those Who Are Thrifty” by Linda A Fri, 14 May 2010 22:09:45 +0000 I’m anxious to find a way I can help ease the economic blow that will fall to my grandchildren because of our public debt.

Comment on Don’t Let Buying a Car Drive You Crazy by Peter Sat, 08 May 2010 14:55:42 +0000 The single best thing you can do to protect yourself is to buy the car (or at least do all the legwork) before you absolutely need to. If you walk in there and you need to buy a car because something happened to your current one and you have no way to get to work on Monday, you will never be able to get yourself a good deal.
Knowing that you can always get back in the car you drove there in and go home is the most powerful bargaining chip you have.

I would disagree a little about the “don’t negotiate on-site” recommendation. For many people that probably is good advice, they will get too emotionally involved. For those of us who can be cold and calculating and are willing to spend the time, doing it on-site has the benefit of them not wanting to see you leave. If you do it on-site and make it take a long time, you have then also tied up so much of their time (that they weren’t using to sell cars to other customers) that they are going to be more likely to give you what you want then to see you leave and have wasted a few hours of their time. On the phone, you can ask for what you want, have them say “no” and be done with the whole thing in 15 minutes. They don’t have as much invested either so it’s easier to let you go.

My wife and I once spent almost an entire day at a dealership waiting for them to give us what we wanted. We even had to take a break for lunch. But in the end, we got what we wanted by simply sitting in the sales office and making them go through the back and forth game until they gave in. We were non-emotional and very patient. After several hours it was worth it to them to not see us walk out and go home without a car. Granted, that wasted an entire day of our time too, but if you keep your car a long time, then giving up one day of your life every 10 years in order to save thousands of dollars isn’t a bad trade off.

Comment on Cheapskates, Tightwads, and Penny Pinchers by Peter Fri, 23 Apr 2010 13:45:59 +0000 Great and fun show. I do enjoy the more technical ones, but it’s good to have something lighter once in a while.

The extent that some people will go to save what amounts to a tiny amount of money is amazing. You mention the guy who takes the red pepper flakes from the pizza place. He is expending so much time and effort doing that when an entire jar of them would cost you a couple of dollars and last for years. Same thing with the person who took huge amounts of napkins from the fast food place. A giant bundle of store brand napkins costs a few bucks and would last ages.

As you mention some of the activities really do get close to outright theft. Regardless, taking far more than you need and will use (for example all the napkins), just has the effect of raising prices for everyone, which of course makes the tightwads’ job even harder. So in one sense they are actually hurting themselves in the long run.

True story of a real tightwad. There is a woman in our neighborhood who had a garage sale a few years ago and was trying to sell a huge number of ketchup and other condiment packets she had taken from various Atlantic City casinos. It’s one thing to take extras and actually use them yourself later, but to try to sell them for a profit? It boggles the mind how someone would try to justify that behavior to themselves.

Comment on Selecting Tax Efficient Investments by Aileen Fri, 16 Apr 2010 07:11:05 +0000 Re: “Don’t let the tax tail wag the investment dog…”
This simply means, don’t sacrifice diversification and/or performance to save a little on taxes. Tax planning and tax efficiency should be a tool to optimize your portfolio, not your overall purpose for investing.

I agree! This is a very great post.. I have learned a lot with this. Thanks!

Comment on Time For Your Check-Up… by Phung Vo Fri, 26 Mar 2010 18:31:04 +0000 Hey,

Where is that article about real estate?

I’m interested in starting to buy rental property to rent out to earn income.

Can you provide that article? I would love to read it.


Comment on Selecting Tax Efficient Investments by Chris Fri, 12 Mar 2010 04:23:01 +0000 Hey Brian,
I can understand your thinking with taxes, and we both probably think of it the same. However, I didn’t want you to neglect to mention payroll taxes and state taxes as these are usually regressive on lower income people. It is probably also important to mention that median wages in this country have not kept up with inflation for at least a decade. So poor are getting poorer and rich are getting richer, which at least rationalizes why poor would pay less now than before. However, I agree if we are going to get out of this deficit mess we are in, it will likely take a little extra in taxes from everyone, and the sooner we can curb spending the better.

Comment on Selecting Tax Efficient Investments by Gaylen Holt Thu, 11 Mar 2010 16:49:01 +0000 I agree that the tax situation is out of control. I do a few taxes as well to keep up, and I see the same situation that Brian was seeing. I think we are paying out too much to people who may or may not need it. I’m in the same boat. I had less cash witheld, made about the same income and I am getting back substantially more. I thnk that lot of crongress and the senate who have voted for these laws should be fired. There is a chance this November to make a change and wake up Washington.

Comment on Roth Conversion: In-Depth Analysis by Brian Preston Wed, 17 Feb 2010 16:10:34 +0000 Brian,

Yes, the Roth podcast can be downloaded to your iPod. If you go to iTunes, we are on the Featured Business Podcast page. You can also search by name, Brian Preston. If you choose to subscribe in iTunes (free), you can have every new show automatically downloaded as soon as we release it. I hope this helps!

Comment on Roth Conversion: In-Depth Analysis by Brian Wed, 17 Feb 2010 00:32:45 +0000 Can this Roth podcast be downloaded to my ipod?

Comment on Understanding Unemployment by Art Fleming Mon, 15 Feb 2010 13:36:07 +0000 The bureau of labor statistics publishes the unemployment figures that Brian refers to. It actually shows that unemployment is rising if you look at the total figures, not the seasonally adjusted figures. Link at

Comment on Roth Conversion: In-Depth Analysis by David Raccah Wed, 10 Feb 2010 15:50:04 +0000 Hey Brian – this is a HUGE win for the higher bracket folks, which in CA is like – everyone, as you cannot survive out here without two job families. Anyway, if it is true that the ROTH conversion limit is all but gone for now, why do they still have a cap on ROTH contributions, everyone is going to just put the money into a non-deductible IRA and OH -wait – convert it!

Use this year to manage the IRA(s) you have and move them back to the workforce and leave just the after tax IRA. Convert that this year and pay the tax for the next two years (for gains or such), and then going forward never pay for ANY further ROTH contributions (through a conversion). Paperwork yes, savaings HUGE!


Comment on Roth Conversion: In-Depth Analysis by Brian Preston Mon, 08 Feb 2010 18:24:05 +0000 David,

As it stands right now, the $100k income limit for doing a Roth Conversion is not coming back. However, I am hard-pressed to believe that it will stay this way indefinitely. The one-time opportunity associated with 2010 is the ability to spread the tax liability over two years.

Comment on Roth Conversion: In-Depth Analysis by David Raccah Sun, 07 Feb 2010 04:07:59 +0000 Hey Brian,

I have one follow-up question. Is this Roth IRA conversion loophole, a onetime loosening of the rules for 2010? Or have the Roth IRA conversion minimums been removed for all years going forward?

Comment on Roth Conversion: In-Depth Analysis by Brian Preston Thu, 04 Feb 2010 19:17:25 +0000 John,

The AMT has not been much of an issue in our conversion calculations. AMT essentially makes you take your after-deduction income and add back certain deductions (taxes, misc. itemized, etc.). Then, once you get this new income number (the AMT taxable income), you have to multiply it by either a flat 26% or 28% depending on your level of income (essentially a flat tax). Realistically, the types of individuals whom we have seen the conversion make the most sense for are those who fall in the 15% – 25% brackets (not hit by AMT) or high earners that have passed the AMT threshold. While I’m sure there are individuals and situations where this problem could occur, I would image the other screens we suggested (outside funds to pay the additional taxes, high relative basis in total IRAs, ability to leave balance for at least 5 years, etc.) would help to avoid having to analyze the AMT implications. As for spreading the taxes, we recommend maxing out the 15% or 25% brackets in the current year. Without knowing for sure the future of tax rates (2011 and 2012), it is difficult to say definitively when will be the most advantageous time to pay the taxes. As we learn more, and Congress releases more information, it will be easier to make these decisions.

I hope this helps!

Comment on Roth Conversion: In-Depth Analysis by Brian Preston Thu, 04 Feb 2010 18:54:38 +0000 Robert,

Great question! One of the really great things about this Roth conversion is that you actually DON’T have to aggregate IRA balances between spouses. Each spouse must file their own IRS Form 8606 (unless the form changes in 2010). As I currently understand the conversion, in your example you would have $80k basis with total IRA balances of $680k. This means that about 88% of the amount you convert would be taxable. Your wife, however, would have total IRA balances of $20k with a $20k basis. Therefore, she would be able to convert all $20k without creating a taxable event.

Thanks for the question and I hope this clear things up!

Comment on Roth Conversion: In-Depth Analysis by John Dutemple Wed, 03 Feb 2010 20:32:39 +0000 Brian,

I thoroughly enjoyed listening to your Roth conversion podcast this morning and admire your willingness to take on such a complex decision as conversion and try to boil it down to finite scenarios. I’ve been wrestling with this for my clients.

I wonder if, in your analysis, you’ve had as much difficulty integrating the Alternative Minimum Tax as I have in developing guidelines. Putting aside the fact that it will require an act of congress (literally) to index the 2010 AMT exclusion to be in line with 2009, if I assume an indexed 2010 AMT, $3,000 real estate taxes (typical for my clients), and a 6% marginal Missouri income tax, I have eight marginal tax brackets for married filers in 2010 to compare to unknown, future rates!

Also, if I use the tax rates as they stand today (Bush tax cuts expiring in 2011 and tax rates going up a minimum of 3%), I have yet to see a client who is better off spreading the taxes over the (higher) 2011 & 2012 tax years if they expect a comparable income in those years. Has this been your experience? For those with large balances to convert, spreading the income over multiple years may push some of the dollars into a lower bracket, but as the $100,000 limit is not coming back, this can be achieved with partial conversions ‘filling up’ the client’s marginal tax bracket year after year.

Again, most of what I’ve seen & heard has been written by journalists rather than practitioners so it was great to hear your point of view. Keep up the good work. I look forward to every podcast.


John Dutemple, CFA, FSA

Compton Advisors, LLC – Planning Futures, Managing Wealth

Comment on Roth Conversion: In-Depth Analysis by Robert Heng Wed, 03 Feb 2010 19:56:22 +0000 Brian, thank you for the great pod-cast and Roth conversion analysis. One thing that still confused me however (after listening and re-listening) is this. The IRA’s are separate to each spouse and presumably each spouse is the designated beneficiary of the other. When you look individually at each IRA under consideration for conversion, as I understand your analysis, you must then consider and thus combine the deferred holdings of the counter-party (spouse), assess the basis in the aggregate in order to determine the amount that will be attributable to tax – correct? So for example, if I had an $80K non-deductable IRA, and a $600K rollover SEP from a 403(b) and my spouse had a 403(b) (not a factor for consideration) and a $20K non-deductable IRA, we would have to consider my $680K combined with her $20K for a total of $ 700K to determine the potential taxable basis to convert only her $20K?

Thank you

Comment on Roth Conversion: In-Depth Analysis by Linda Albers Wed, 03 Feb 2010 18:24:15 +0000 Two things I’m not clear on are —
1) If the payment of taxes on a 2010 conversion are split between tax years 2010 and 2011, must the split be 50/50? and
2) will the payment made for 2011 be based on the tax rates in effect for 2011?

(I suspect the answers are “yes” and “yes.”)

Comment on Roth Conversion: In-Depth Analysis by pascale Tue, 02 Feb 2010 01:14:42 +0000 Brian,

Enjoyed the show on Roth Conversions. I wanted to point out one area I think you neglected. I have a 401k which held after tax contributions. I checked with my company’s plan and they allowed me to separate the after tax contribution portions and convert to a Roth. I’m fortunate in that the pre-tax and after tax contributions were separate. Since, I hadn’t had any return on the after tax amt, I was able to convert $25k into a Roth at Vanguard tax free. So, now going forward – all growth will be tax free.

Anyway, great show. I really enjoy it.


Comment on Roth Conversion: In-Depth Analysis by David Raccah Mon, 01 Feb 2010 18:30:20 +0000 Hey Brian (and Bo),

LOVE this show. I had to do so much homework on my own, before the podcast, to figure out what you had in this compact and wonderful 55 minute podcast. Bravo on all the hard and clear work. Just a couple of comments.

1) I too have post-tax IRA(s) and thought I was home free! HA HA! We have a rollover IRA from my previous employer. So because I cannot cherry pick my IRA(s) to convert, I looked into the options at work, and guess what – they allow us to roll my existing (ROLLOVER IRA ONLY) IRA into our 401k at work! So once I do that I will be left with JUST my non-deductible IRA and now the cost of the conversion is way low. So please check with your employeer if that is an option!

2) To double check the calculation – check out this guys website, it is nice and clear, and gives great examples. and

Comment on Happy New Year and A Happy Retirement by Bradley Martin Fri, 22 Jan 2010 20:44:55 +0000 I agree with your assessment Brian on the net worth calculation. Dr. Thomas Stanley has some really good information, but I think for a younger person it is very difficult. My wife and I (we are both 27) do not come close to Dr. Stanley’s calculations. However, we are debt free except our house (after paying off large student loan balances). We are not wealthy by Dr. Stanley’s calculations, but still in better financial shape than many of our friends and the “average” American. My wife is a teacher, I work for a State of Georgia law enforcement agency. Combined we make around $80,000. Then subtract daycare, insurance, bills, 401 (k) etc.. Using Dr. Stanley’s calculation we should be at $217,533 for net worth. No way that is possible. Keep the podcasts coming!

Comment on Happy New Year and A Happy Retirement by Taylor Thu, 21 Jan 2010 18:43:04 +0000 Brian,
You had mentioned a website about personal finance. I was wondering if you could post a link. Thank you

Comment on Happy New Year and A Happy Retirement by Brian Preston Wed, 20 Jan 2010 17:24:44 +0000 Here is the link for PayTrust. I hope this helps!

Comment on Happy New Year and A Happy Retirement by jetfxr27 Tue, 19 Jan 2010 15:08:45 +0000 Longtime listener, great podcast.
Came to the page looking for a paytrust link. I have noticed you have mentioned it more than one time. I too have new children and am learning I can’t spend as much time as I used too on smaller things. I think I’ll try them out. Thanks Y’all!


Comment on Happy New Year and A Happy Retirement by Brian Preston Thu, 14 Jan 2010 19:05:50 +0000 Greg,

I’m a little confused about your question. I noted in the show that a good ‘rule of thumb’ check-up is to take your age, multiply it by 10%, and then multiply that by your annual income. I’m not sure what you are asking for with ranges? The point I was making is that this won’t always work for young individuals just starting out in their career. For example: a new college graduate may start out making $25,000 a year at 22 years old. According to the equation, he would need to have a net worth of $55,000 dollars. This may be a little ambitious for someone just starting out. I think a good starting point to use this calculation would be someone who has been in the work force for at least 5 or 6 years.

Comment on Happy New Year and A Happy Retirement by Greg Sgrosso Wed, 13 Jan 2010 19:03:24 +0000 You mention an equation to calculate your Expected Net Worth based on your age and income level, but there were no thresholds provided. Do you have some simple ranges you can post?

Thanks for a great show!

Comment on Happy New Year and A Happy Retirement by Rick Francis Tue, 12 Jan 2010 18:31:55 +0000 Brian,

I love the podcasts keep them coming! I would add one point for the younger listeners and would put it first because it is vitally important:

0 Start saving for retirement as early as possible!

Starting early is really a huge difference because of compound interest! Without a lot of time you don’t get much from compound interest. I wrote a post on this a while back, and was surprised at just how much it costs to start late. You not only need to contribute a higher % of your salary but you also end up living on less in retirement. Check out the graphs to see for yourself:

-Rick Francis

Comment on Year-End Clean Up by erin peterson Wed, 09 Dec 2009 16:40:38 +0000 Enjoyed the podcast — but I’m curious if you think that the net worth statement that you calculate is different or superior to the one offered (for free) by, which is updated in real time by accessing all of your accounts electronically. That’s the way that I track my net worth. I like getting frequent updates though the weekly summaries that they send via e-mail can be deflating/counterproductive when the stock market tumbles.

Comment on Year-End Clean Up by Josh Kowall Tue, 08 Dec 2009 20:39:25 +0000 Love to hear Bo getting some “work” live on the podcast.

Comment on TGI BLACK FRIDAY!! by Sarah Wed, 25 Nov 2009 00:54:59 +0000 Love the new format with Bo helping out! Cheesy 80’s hits and all!
Hey, why don’t you have a Facebook page for fans of the show?
Thanks for all you do to keep us entertained and “in the know”.

Comment on Health Insurance Making You Sick? by Brian Preston Mon, 16 Nov 2009 16:45:25 +0000 Hey guys,

I got the following email from John and it was such good information I wanted to share it. So, John, thank you!

” Brian,

I was listening to your podcast in the car (and am writing this a
roadside park) so someone may have pointed this out already but you
CANNOT use an FSA to pay the deductible under a Health Savings Account
and still get the full tax benefits.

Having any other medical coverage (except for something de minimus like
medical coverage under an auto policy) like being on your spouses plan
or having an FSA renders the HSA contributions after-tax. The idea being
you already get a deduction for the HSA – getting another for the FSA or
your spouse’s employee getting one for premiums is double-dipping.

Also if you revisit this, you may want to point out HSA balances can be
used to pay qualifying LTC premiums.

I thought the cast was great, especially your point about comparing the
dollars behind co-pay vs co-insurance.

I listen to every cast. Keep up the good work.


Comment on The Tortoise, or the Hare? by William Sat, 14 Nov 2009 22:45:28 +0000 Brian,

What would the returns be for the two funds if one would have been contributing on a monthly or yearly basis on a dollar cost averaging method? You did this several weeks ago to show that a fund over this bad year ended up pretty good if one invested monthly through the bad times.


Comment on Health Insurance Making You Sick? by Josh Fri, 13 Nov 2009 17:02:49 +0000 Flexible Spending is a great way to reduce your taxable income for qualifying expenses. However, I think a huge step toward improving the heath care system would be to stop making us guess how much we expect to spend next year. My family has a major medical expense scheduled for early December that we had no way of knowing about 13 months ago (when we made our guess for how much flexible spending we would need this year).

I already had to submit my guess for next year. I have no idea what I’m going to spend up to 14 months from now. I would prefer to just have an account I can add money to whenever I need it, and then pay with the debit card. When taxes are due, you can submit your account details, including how much you spent, and get the deduction. It would be easy to audit because it is a completely separate account.

Comment on Health Insurance Making You Sick? by Rob Shipp Wed, 11 Nov 2009 19:49:49 +0000 Brian,

Another informative podcast.

Our small business has been using the HSA/HRA combination successfully now for about 3 years. Here are a couple of points I’d add.

1) Do not use your HSA funds until after the claim has been submitted to the insurance carrier. In other words, try not to pay at the time of service even though you may know that you will be 100% responsible(until your deductible is met). If the provider files the claim, you will likely still receive the negotiated discount. If you’d payed on the day of service, you’d likely be paying the full usual and customary fees set by the provider.

2) This one is more anecdotal, but there are sometimes big pre-payment discounts for “big ticket” procedures. In our case, we didn’t have maternity coverage during our most recent pregnancy(although a maternity rider is available with most HSA’s), but were able to negotiate a 50% discount because we offered full payment during the first trimester. Most hospitals/providers do have a policy regarding this, but we were shocked to discover that it amounted to half off for us.

Comment on Health Insurance Making You Sick? by Donald Patterson Sat, 07 Nov 2009 01:53:00 +0000 OK. But what I really want to know is how can I get health insurance when I don’t qualify for an group plan (my 18 months of COBRA are coming to an end but I am still HIPPA eligable) and my family has pre-existing conditions.

Comment on Health Insurance Making You Sick? by Josh Kowall Fri, 06 Nov 2009 20:07:09 +0000 Brian,

Thanks for the great podcast. I just had to make my Heathcare election for next year and we had a really hard time deciding b/t our options. Especially considering that my company changed our options and this year’s PPO was much more expensive than last year. We stayed with the PPO option because we were concerned our expenses would be severe in 2009 and thought it was the “safer” choice. Wish I would have heard this earlier, it may have helped push our decision the other way. They don’t make it easy, it was a very complicated decision. You should publish your spreadsheet on how you did the math to make the HRA decision.

Comment on The Tortoise, or the Hare? by Brian Preston Thu, 29 Oct 2009 19:13:49 +0000 The two funds we used for our analysis were for illustrative purposes only (by no means should this be considered investment advice or endorsement). They were:

American Funds Growth Fund of America A (AGTHX)
Oakmark Equity & Income (OAKBX)

Comment on The Tortoise, or the Hare? by George Soumakis Thu, 29 Oct 2009 14:27:11 +0000 What were the two funds you were discussing in the podcast? I could not make them clearly.

Comment on Credit Card Review by Mark Tue, 20 Oct 2009 00:48:05 +0000 Brian,

FYI. I currently have a Fidelity Investment Rewards Visa that gets 1% cash back. The current Fidelity offer with the same name has a different points program. This goes for the Fidelity 529 AMEX too. Listeners need to check their statements and not assume they are getting the 1.5 or 2% points. I have called FIA Card Services(Fidelity’s card processor) to transfer my account. They do not know how to do this, and may require a new application. This is not a great option for us that have long working record but have lost their job due to the current economic climate.

Comment on Credit Card Review by Kees Tue, 13 Oct 2009 01:07:41 +0000 Brian,

Your oct. 7 podcast made it again clear to me. Credit cards are a disaster for our country. Too many people got credit cards and inflated their credit scores and allowed them to buy houses and stuff they could not afford.

About the benefits: Guess is paying for the 2% cash back: You. For sure it is not coming out of the merchant profit margin.

I have dumped credit cards years ago and never have to worry about rates, fees, balance, make payment on time, forgetting to pay ever again.

Comment on Credit Card Review by Bradley Martin Fri, 09 Oct 2009 11:58:00 +0000 Hey Brian! I just wanted to say thanks for my “personal” shoutout to local McDonough fan! Excellent podcast as usual. Very good information on credit cards and the types of credit card users. According to the credit card industry, my wife and I are deadbeats because we do not have a balance and pay it off every month. We don’t really use our credit cards other than for some college textbooks (I’m enrolled in a Doctorate program). We do not have cash back cards, but you gave me something to ponder. I might look at some of the cash back cards, but then I also have to balance the fact that it might lower my credit score to get a new card.

Thanks for the information! Also remember to get some sleep! I am sure you need it!

Comment on Life Changing Events and The Fair Tax by Peter Wed, 07 Oct 2009 01:28:39 +0000 First, congratulations on the new baby.

Second, the issue with the fair tax you’re forgetting is that while some things will cost (as in your example) 20% more, you’ll be taking home (for example) 20% more in your paycheck. So it should all balance out in the end. It would have to, otherwise it wouldn’t be revenue neutral.

In the beginning it would be hard on everyone who is used to the “old” prices, but pretty shortly when you complain that a $10 item is now $12, you’ll look in your wallet and see 20% more money and think maybe $12 isn’t so much after all. There really isn’t much difference between me paying you $100 and taking $20 of it as tax before hand leaving you $80 of purchasing power, and me paying you the full $100 and having an $80 cost $100 with the tax added on the back end. That $100 still purchases the same item or service.

That’s the whole problem with any revenue neutral tax change. If it’s not going to change the amount of money coming in (up or down) then what’s the point? Any revenue neutral change is going have some people paying more and some paying less. Then the whole discussion just changes from how much should everyone pay, to how much extra one group is going to pay and how much another group is going to save. I’m not saying the current system is good, but at least it’s a known entity and a lot of our economic infrastructure is built upon the existing system. Any change that isn’t going to alter the amount of money coming in will still end up “costing” everyone money due to the costs of changing everything. It’s like moving from one apartment to another and keeping your rent the same. You still pay the same amount each month, but now you have all the costs of moving and in the end, you’re no better off financially.

Comment on Life Changing Events and The Fair Tax by Bradley Martin Thu, 24 Sep 2009 14:12:33 +0000 Brian I really enjoyed this podcast. My wife and I (both 27) have a 13 month old son Asa. We are having “the talk” about having another child in the next 2 years. Your podcast made some great points about life changes and planning responses to life changes. I think you are right on target with the Fairtax. It is easy to beat up on the IRS or on payroll taxes, but if something is going to be revenue neutral everyone will have to pay a lot more. I also tend to listen to Neal Boortz and agree with him on many issues. However, my wife and I (my wife is a teacher and I work for a State of Georgia law enforcement agency) are constantly told we are “evil government bureacrats”. The plan is only a theory. No one has an idea of how exactly it would work. Another issue with the Fairtax (I don’t like the name taxes in the United States have always been progressive and have never been fair) is who is going to audit records for sales tax? Wouldn’t this require state department of revenues and the IRS to audit and investigate sales tax? Supporters are just moving taxes from a payroll and income tax to a sales tax. Ask surrounding states (Tennessee and Florida) who have sales tax what can happen during a recession. States with only sales tax revenue tend to have less predictable revenue streams. So we are going to base social security, medicare, and the entire federal government spending on very unpredictable and volatile revenue streams? It doesn’t make sense. Yes changes are needed to the tax system. Many loopholes need to be removed. Relying exclusively on a “Fairtax” would be a tremendous mistake. Also politically only libertarians and ultra conservatives support the proposal. There is no chance it passes in Congress.

Comment on I.O.U.S.A. One Nation. Under Stress. In Debt. by Oscar Perez Mon, 14 Sep 2009 04:50:38 +0000 Hi Brian. I just hosted a viewing at my home so my friends can watch this documentary. It is a true eye opener.

Comment on I.O.U.S.A. One Nation. Under Stress. In Debt. by Reed Davis Sun, 13 Sep 2009 07:25:19 +0000 I agree that it was a very good podcast. For example, I liked that you gave the historical debt/GDP ratios over the entire history of the U.S. Some people look back just as far as 1940 (which is how far back the U.S. Budget Historical Tables go) and point out that the debt/GDP ratio was higher after World War II. However, this was the highest ratio in the entire history of our country and was due strictly to the war. The deficit dropped back down close to zero once the war ended and the debt/GDP ratio began a long decline. We have no similar prospects now.

I also liked that you pointed out the rise in the foreign debt ownership and the prospect of financial warfare such as what the U.S. threatened to get our allies to pull back from the Suez Canal. One other difference about foreign ownership is that the interest earned by U.S bondholders is chiefly spent in this country. The interest earned by foreign bondholders, however, is much more likely to be spent in their home countries.

Regarding Bill Gross’s podcast I did find that one can also download the MP3 file for his monthly podcast at .

Comment on I.O.U.S.A. One Nation. Under Stress. In Debt. by Brian Preston Fri, 11 Sep 2009 17:16:48 +0000 That individual is Bill Gross. As I mentioned in the show, he is like the “Warren Buffet” of the bond marketplace. If you go to the iTunes store and search for “Bill Gross” or for “PIMCO Investment Outlook”, you can access his monthly market commentary podcast.

Comment on I.O.U.S.A. One Nation. Under Stress. In Debt. by Greg Milette Wed, 09 Sep 2009 15:47:23 +0000 Nice show, and well stated. You mentioned a podcast by the person who runs PIMCO, can you provide a link to that?

Comment on I.O.U.S.A. One Nation. Under Stress. In Debt. by Reed Davis Sun, 06 Sep 2009 09:08:03 +0000 I saw the movie I.O.U.S.A. right after it came out and share your concern. In fact, I’ve been following this issue since 1992. If you want to see something really frightening, look at the first graph at . This shows the government’s own projections of where the debt is headed. As you can see, it’s projected to reach at least 275% of GDP by 2080.

By the way, these projections are for the “debt held by the public” whereas the ones you give are for the somewhat larger “gross federal debt”. I actually think that the gross federal debt is the more important measure for the reasons given at . In any event, both measures are projected to skyrocket by 2080.

I’ve looked at a few of the other figures that you mentioned from I.O.U.S.A. A breakdown of the $53 trillion figure that you mention can be found in the table at . The table also shows a 65.5% of GDP figure for the gross federal debt, very close to the 64% of GDP figure you mentioned. Anyhow, thanks for raising this issue. I haven’t had a chance to listen to your podcast on the issue yet but will do so tomorrow.

Comment on I.O.U.S.A. One Nation. Under Stress. In Debt. by Bradley Martin Fri, 04 Sep 2009 17:04:39 +0000 Hi Brian! I reviewed the docmentary when it first came out. I love it and own it. I am a money map/budget coach in my local church and plan on incorporating this documentary into our financial ministry. I work in government right now and after watching this documentary, reviewing your podcast, and reading lots of books, I have decided to devote myself to becoming a financial planner. I know a lot of critics have blasted the documentary because the film is not prescriptive in providing answers. I know another site says the documentary is propaganda from rich people. I disagree and think the documentary is neutral. The decision to raise taxes, cut spending, cut entitlement benefits or all three is up to our elected officials.

Comment on Bing Double Cash Back by John Donaldson Thu, 20 Aug 2009 04:27:08 +0000 I’m a careful shopper. Thought I’d take advantage of the 12% cash back offer. But when I checked I was able to purchase the item cheaper direct from rather than go through the Bing discount path which included expensive shipping. Check before you buy. There may be other deals where you actually save money but this time didn’t work for me.


Comment on When The Going Gets Tough… by Ben Sat, 15 Aug 2009 07:23:55 +0000 Hey Brian,

Thank you so much for keeping up with this podcast. I’ve been a listener for about a year now and I have to say, your advice has definitely given me a one-up on my peers in terms of financial skills. A quick tip: in addition to, there is another site that also does cash back rewards, They seem to have a wider selection of stores and from my experience have been a phenomenal tool for finding the absolute best deal.
Keep up the excellent work!

– Ben from NY

Comment on When The Going Gets Tough… by Spike Fri, 14 Aug 2009 20:15:10 +0000 The illustration above was very, very helpful in exemplifying the principle of dollar cost averaging. I think what happens with most people is that psychologically, they imagine their money disappearing. What your example helps to point out is how the investment vehicle itself doesn’t disappear, but how continuing to put in through lower valuations will usually average out positive over time.

Comment on When The Going Gets Tough… by Brian Preston Thu, 13 Aug 2009 15:45:29 +0000 Patrick,

You are spot-on, however, I believe you missed the point of the show. I was attempting to show the benefits of dollar cost averaging and staying disciplined through the darkest of times. Let’s assume that instead of investing $100,000 at one time in September, you invest $10,000 every month beginning in September (I understand this is going to equal an investment of $120,000, but I would prefer to use nice round numbers for the sake of demonstration) and lasting until August of this year. If you were to check your investments (I’m using a large-cap growth mutual fund) in March of 2009 (the darkest of times) your monthly contributions’ performance would be: (beginning in Sep.) -34.18%, -23.82%, -16.53%, -7.99%, -15.42%, -11.03%, and -2.02%. This leaves your $70,000 total investment at $58,901; a total return of -15.86%.

HOWEVER, if you were disciplined and stuck it out through these hard times and continued investing monthly all the way through August, your individual investment performance for each contribution would be (beginning in Sep.): -11.20%, 2.77%, 12.60%, 24.12%, 14.58%, 20.03%, 32.18%, 15.34%, 8.04%, 5.52%, 9.86%, and -0.47%. Your $120,000 would now be worth $133,337; a total return of 11.11%.

Whether we are talking dollars or percentages, I think you can see the value of having a sound plan and sticking to it!

Comment on When The Going Gets Tough… by Patrick Noyce Wed, 12 Aug 2009 23:42:23 +0000 $100000 looses 29% leaving 71000. comes back at 32% $22,700 equalling total of $93720.00 still down 6.3 % I hate percentages talk $$$$$

Comment on Time and Money – it can be your best friend by Christopher Pon Fri, 07 Aug 2009 19:33:18 +0000 This one talks about 529 plans, so I think it’s linked to the wrong podcast.

Comment on Free Fixes and ‘Cash For Clunkers’ by Dallon Christensen Thu, 06 Aug 2009 17:24:00 +0000 Brian, I understand the environmental need for “Cash for Clunkers”, and I also understand how the car companies will enjoy the boost of new car sales. However, I am concerned about the used car supply decreasing. This would increase the cost of used cars, and some people who need a “clunker” to drive as they work their way out of debt may not have as many options.

I am also concerned about another government program being bungled. I know you talked about this in the health care podcast, and I’m very concerned about another government intrusion into the buying patterns of consumers. People should not need the government to help them make good environmental decisions.

I also like Robert’s idea about having an occasional guest. Do not get me wrong – you do a fantastic job on the podcasts. Adding someone like Bill or Bo would only enhance the broadcast, because we would have another viewpoint and opinion. I listen to other financial podcasts besides yours, and I learn so much more by comparing and contrasting everyone’s opinions.

Comment on Free Fixes and ‘Cash For Clunkers’ by Amy Smith Thu, 06 Aug 2009 11:42:05 +0000 Brian,

What is up with the Chase Ultimate Rewards? I cannot find out what the 3% “bonus categories” are for the “updated” rewards program. No “Welcome Packet” came in the mail as promised. There is nothing on the website to answer this question. And when I called to ask, I was routed through 4 persons and still received no straight answer. Is it a big secret or something? p.s. LOVE your show! Amy

Comment on The Elite Savvy Consumer by pascale Tue, 04 Aug 2009 23:14:11 +0000 Brian, great show. Great tools. I think for a future show, it would be nice to go over what you feel are the best of the best (credit cards, online banks, etc). We see these ratings all the time from Kiplingers, Money Magazine, etc. It would be great to see your constructive opinion. Thanks for all you do.


Comment on Free Fixes and ‘Cash For Clunkers’ by Robert Shipp Tue, 04 Aug 2009 21:44:23 +0000 Brian,

What about having an occasional guest? I say we mike up Bo, or get Bill Cleveland on the air. What are the chances? I think a little back and forth banter about the market would be excellent content.

Comment on “Dead Ideas” Living On by Tim Guczwa Mon, 27 Jul 2009 18:37:25 +0000 Great podcast and I like your comment regarding distributing your investments into 401(k)s, IRAs, ROTH’s etc., however having multiple accounts (including a spouses) makes it increasingly difficult to tell if your portfolio has the proper diversification you speak about. The multiple monthly statements you get just don’t cut it.
If you haven’t yet hit the $200,000 threshold recommended for hiring a professional, you are stuck trying to achieve the proper diversification on your own. How do you recommend managing these multiple accounts so that you get the proper diversification? Do you recommend using software like Quicken, Microsoft Money, or some type of online investment manager? Any help or advice would be appreciated. Thank-you in advance.

Comment on “Dead Ideas” Living On by Lawrence Smith Sat, 25 Jul 2009 02:36:09 +0000 This was a great podcast. I particularly enjoyed the portion devoted to the moving a regular IRA to a Roth next year when the compensation limit is removed. I was taken back with your speculation that the government may tax the gains in the Roth at some point in the future and how they may only allow what the Roth account is worth at some date. This could impact my interest in this rollover to the Roth next year. I would like to hear more on the subject as we come closer to 2010 or in 2010. What sometimes seems to be a no brainer could end up not being so!

Thanks again,

Larry Smith

Comment on “Dead Ideas” Living On by Rick Francis Fri, 24 Jul 2009 16:46:13 +0000 Bryan,

Its human nature to want to brag about a smaller loss- but consistently smaller losses can quickly translate into larger long term gains.

I think the people claiming MPT is dead lack an understanding of MPT. The key phrase is reduced risk- NOT eliminated risk! The theory doesn’t preclude all asset classes dropping at the same time. All asset classes dropping together really aren’t that common- Financially 2008 really was an unusually bad year! MPT doesn’t even guarantee positive returns even if only one asset class you own drops.

-Rick Francis

Comment on “Dead Ideas” Living On by Charles Mobley Fri, 24 Jul 2009 15:20:27 +0000 Good stuff Brian! Keeping your eye on the big picture will be profitable. I agree with you on sticking to the basics for long term results. Looking forward to your next installment of The Money Guy.

Comment on The Elite Savvy Consumer by kent johnson Thu, 23 Jul 2009 18:31:38 +0000 Hey Gang,

Great episode Brian. Three quick .02 comments…

– Since it dovetails so nicely into this episode, I thought I’d recommend the latest Kiplinger feature article and related podcast entitled “Steal These Deals” on savvy shopping.

– At the risk of being ‘anti-economic recovery’, imho the only thing better than buying something at a deep discount is postponing or avoiding the purchase altogether. The delayed gratification point should not be missed on this topic.

-The paranoid guy in me says… Identity theft is big business these days and can cost you your credit rating plus the time and money to clean up the mess left behind. When signing up for discount programs you are selling the vendor your privacy in exchange for some compensation. The more databases ‘in the ether’ that contain your personal information and habits, the higher the chances this information will be stolen and/or misused. I’m not suggesting we all go off the grid, just be aware of the risk and perhaps stick with a select number of name-brand merchants when in a ‘joining’ mood.

Comment on The Elite Savvy Consumer by Peter Thu, 23 Jul 2009 01:40:12 +0000 I’m all for making the most of my money, but I have to question 2 of the items you mentioned in the episode.

1 – You mentioned you found the lamps for your wife’s 15+ year old mirror on eBay and saved about $15 on them. That’s great, but at some point you have to decide how much effort it’s worth. You saved $15 on something you apparently only need to buy every 15-20 years. I’d be more inclined to spend the time looking for ways to shave $5 a month off my phone or cable bill. That is going to provide more long-term savings. Saving $15 once every 15 years doesn’t really make a big difference in the long run.

2 – You mention getting brick and mortar retailers to honor Internet pricing. There is a fine line between being a savvy shopper and taking advantage of a merchant. The traditional retailer has additional overhead costs and is providing you the ability to purchase the item right there (rather than waiting to have it shipped). Obviously, that is worth something to you or you would have just bought it online and not bothered going to the store and trying to get them to price match. Making retailers match online prices cuts into their profits and will eventually lead to them raise prices or go out of business. Neither is good for the consumer. You may have noticed that since retailers like Circuit City, Linens and Things and others have folded, their competitors have raised prices and made their service worse. They now how less competition so they don’t need to be as customer-friendly.

Retailers are allowed to make a profit, and squeezing them too much and shopping solely on price creates a price-driven mentality where manufacturers only care about producing a product at the lowest price possible with no regard for quality, durability or service. If you think a retailer is charging too much, you are free to not shop there. Just because someone else is willing to sell it for less doesn’t necessarily mean you’re getting ripped off. If the other guy is offering such a good deal, why not buy if from them? There is obviously a reason you’d rather purchase from this specific retailer and if their prices are a little higher maybe that’s the premium you’re going to have to pay for the convenience, service or whatever else you value about them that makes you want to shop there as opposed to the place with the lower price that you’re not willing to just take your business to for some reason.

How would you like it if your clients kept coming to you and saying “I found a financial planner on the Internet who can create a plan for me for $100 less. I want you to match their price.” I’m sure you would tell them about the value and service you will provide and how that’s worth the extra money. Why aren’t retailers allowed to do the same thing? This is one of those situations where is seems great when you do it and “get a deal” but it would cause real problems if everyone started doing it with everything.

Comment on The Elite Savvy Consumer by Brian Preston Wed, 22 Jul 2009 15:28:04 +0000 Randy,

The card that once gave cash back on restaurants, groceries, and gas was the Chase Rewards Plus card. Unfortunately, this card is no longer available. The replacement to this card is now the Chase Ultimate Rewards Card. The benefits of this card are: 1% on all purchases, 2% additional for gas, grocery, and fast food purchases. There will also be quarterly additional bonus offers similar to that of the Discover More Card. I have yet to decide how I feel about this new card. I’m obviously disappointed because this is a far cry from my original card. I will keep you up to date as I see new and intriguing offers.

Comment on The Elite Savvy Consumer by Randy Mon, 20 Jul 2009 21:56:05 +0000 Brian,
Thanks for the great tips. Can you provide more details about the specific credit cards that give you cash back on various categories. I’m having trouble finding some of the ones you mentioned. I’m really interested in finding ones with 5% cash back on restaurants, groceries and gas.

Comment on The Elite Savvy Consumer by Brian Preston Mon, 20 Jul 2009 12:44:21 +0000 One tidbit I forgot to add is that anytime you are shopping online, once you have determined the product you want and the vendor you plan to use, be sure to do a Google search for coupon codes. You will be surprised at how often this simple step will save you on shipping or possibly get you 10% – 15% off!

Comment on The Elite Savvy Consumer by Michael Mon, 20 Jul 2009 04:16:08 +0000 Hi Brian,

I just wanted to thank you for such a great episode!

I consider myself an extremely savvy consumer and very well-versed in Internet price comparisons, yet even I learned a few very useful things from this episode.

Keep up the good work!


Comment on Bail Outs = Bad News by Peter Wed, 15 Jul 2009 01:58:35 +0000 The only way to reduce health care spending is to reduce services. You can’t give everyone an MRI every time they get a headache and charge them $10/ month for healthcare. Either we have to accept spending a very large percentage of our personal and/or taxpayer income on healthcare or we need to do some type of rationing.
As you mention in the podcast, a huge amount of resources are spent at the end of someone’s life. Roughly half of your LIFETIME total healthcare expenses can occur in the last 4-6 weeks of life. That is an outrageous waste of resources. When the end comes and people want to do everything possible to prolong someone’s life for even a few days, we need to decide if that is a good use of our resources. How much is it really worth to have grandma alive for an extra week? If she’s 95 years old and suffering congestive heart failure, the unpleasant reality is that she is not going to get better. If we as a country decide we want to pay for that, then that’s up to us, but we have to understand it is VERY expensive.

The bottom line is that healthcare isn’t really a free-market system. Most people will not decide to use the cheapest surgeon around, or put off a procedure for 6 months until it goes on sale. When your health and safety (and possibly very life) are dependent on proper and timely medical care, you generally don’t put a lot of weight on the cost factor. You do what needs to be done and deal with the financial issue later.

So either you want healthcare to be all things to all people all the time, and pay through the nose like we do now; or you allow it to become some things to some people some of the time (otherwise known as rationing) and pay less.

Comment on Bail Outs = Bad News by Robert Shipp Tue, 14 Jul 2009 19:38:05 +0000 A lot of the problem with health insurance is caused by the misunderstanding of the term insurance. Most patients think health insurance means you pay little or nothing when you go to the doctor. If health insurance were limited to catastrophic or major events as most other types of insurance are, we’d have much less of an issue. (i.e., No one expects to use their home owner’s policy to paint their kitchen).

I’m not sure why people have this perception, but I can assure you it is difficult to overcome.

Comment on Bail Outs = Bad News by Sarah Mon, 13 Jul 2009 19:48:31 +0000 For anyone who thinks socialized or “government run” healthcare is a good idea, take a trip over to a military hospital or a VA hospital. You will change your mind.

Comment on Bail Outs = Bad News by Brian Preston Mon, 13 Jul 2009 16:45:55 +0000 Thank you for the heads up about the show cutting off! We have gone back and fixed the problem. If you download from iTunes, you can now go back and re-download the entire show.

Comment on Bail Outs = Bad News by James Mon, 13 Jul 2009 05:55:14 +0000 Brian, I’ve been listening to your podcasts for a long time now. I’m a professional accountant like yourself, and I’ve enjoyed your approach to explaining personal finance topics that I usually find very relevant. However, I notice that with recent podcast episodes, you’ve started to delve into politics more and more. For example, your most recent episode on the proposed health care reform in America is pretty much all politics. Firstly, I don’t believe the “Money Guy” podcast is the right venue to voice your personal political viewpoints – certainly that is not what I subscribe to the show for. Secondly, even though I understand that you’re trying to be objective in your discussions, and I commend your effort at doing so, your discussions invariably introduce elements of personal ideology and bias, which is reflected in the way you emphasize arguments for one side (not invalid arguments by the way) to support your personal point of view. Whereas I have a lot of respect for you as a financial advisor and finance topic podcaster, for the reason that I find your personal finance related topics well researched and tend to be consistently long-term focused rather than the shorted sighted reporting typically found on network news, I have not enjoyed your political discussions. Such topics are often just too broad to be covered in a fair and balanced way in a short amount of air time (I find NPR radio to be a much more appropriate forum for politics), and the one-sided presentation such as the one you gave in the recent episode puts you in a bad light to those of us out there who hold different views on certain issues. I’m not saying that I now dislike you for your political views, but presenting one-sided arguments (publicly) is not in keeping with the image of a fair minded professional that I have of you from listening to your podcast over the last couple of years. In short, please keep up the good work on the “Money Guy” but please refrain from trying to get into political debates on the show.

Comment on Bail Outs = Bad News by Bob Myers Sun, 12 Jul 2009 02:02:33 +0000 Thanks for your podcast, the information is always beneficial, however, your latest show was cut off in the middle (after 30:20)

Comment on Bail Outs = Bad News by Chris Sat, 11 Jul 2009 01:55:52 +0000 HI Brian,
I think the show cuts off in the middle this week. I was looking forward to hearing the conclusion. Thanks

Comment on Bail Outs = Bad News by Rick Francis Fri, 10 Jul 2009 18:50:56 +0000 The US Heath Care system has to change, the current system leaves too many without coverage, and the cost increases for those with coverage are not maintainable. The insurance companies and providers have not made the necessary changes and it is not necessarily in their financial interest to make these changes! Unfortunately, that leaves making the changes to the government. I suspect the government will not do a great job of reforming the system, but it wouldn’t be that hard to at least improve the current trends. Since you are asking for ideas on a better system here are mine:

Some level of coverage for everyone is needed- this should be bare bones coverage, some treatments should NOT be covered- based on their cost to benefit ratio. There should still be a private insurance market for broader coverage.

Consumers must accept that insurance will not be able to cover every possible procedure. Age and overall health should be a deciding factor too- We just can’t afford to give everyone a heart transplant.

Consumers of healthcare should always pay some % of the cost instead of a fixed copayment so that they have an incentive in keeping costs down.
Providers need to publish costs so that consumers can make rational purchasing choices. What other industry do you know of where the costs are unknown until after the purchase?

Physicians must know the costs of the medications they subscribe and the tests they run. Today most physicians DON’T have any idea. So they can be influenced by drug company reps to prescribe new expensive drugs that are not necessarily better.

We as a society need to rethink our attitude toward death. Healthcare costs soar for the elderly, especially near the end of life. At what point is this care just prolonging the inevitable? Does it really make sense both for the individual and the cost to society as a whole?

Rates should be uniform for the same care from the same source. Currently uninsured patients pay far more for the same care from the same doctor and hospital!

The AMA limits the number of medical schools and thus the number of doctors. That artificial shortage should be put to an end.

Providers should make much more use of nurse practitioners- a lot of care doesn’t require a doctor, so why pay for one? A Nurse practitioner can always pass the appropriate patients to a doctor. AMA lobbies for laws to prevent this now!

Malpractice insurance needs to be changed- we can’t afford medically unneeded tests as malpractice shield. This would likely require some kind of reforms for malpractice law. A medical mistake should NOT be like winning the lottery.

A Physician’s malpractice record needs to be published- this should help drive out quacks and lower overall malpractice insurance rates.

Preventative care that is proven to be cost effective should be subsidized so that it is very affordable. Don’t make the emergency room people’s primary way to get health care. Deal with problems before they become expensive emergencies.

Open the American pharmaceutical market. I see no reason to believe that Canadian pharmaceuticals are any danger to American patients- they are just a danger to America pharmaceutical Company profits.

This isn’t my area of expertise so I’m sure that others could come up with more and better ideas. The problem with these changes is that they are sweeping changes and there are a lot of powerful interests that would lose money and thus will oppose these changes. The ultimate question is do we have the will to make real fixes or just band aids?

-Rick Francis

Comment on Legacy of A Generation… Not the Millionaire Next Door by Spike Fri, 10 Jul 2009 18:29:00 +0000 Thank you Brian for another insightful podcast. I share your revelation and am also a Gen Xer. I have observed many in the Boomer generation who have enjoyed wealth in the past but are now in a very different financial situation and simply unable to make the lifestyle/personal adjustments necessary to be financially fit. And It’s understandable. Even speaking for myself, going from a nice Audi to my current $1000 car in order to remain financially solvent has been humbling.

Unfortunately, I think many folks lack the determination, dedication, humility, self-awareness, resourcefulness and perspective it takes to adopt many of the ideals and financial practices of the Depression Era folks.

Comment on Why a Roth 401k May be Your Best Bet by Josh Fri, 03 Jul 2009 18:32:00 +0000 QT(the gas station chain) is doing $0.49 32 oz drinks, even better than the $0.99 McDonald’s drinks!

Also, I use the Amex Blue Card for everything and am hoping that is still a good one, but will look forward to a future podcast where BP will do some research for me on some other good credit cars rewards programs

Here’s a macro 401k vs Roth 401K question:

I have always maxed out my 401K and Roth IRA contributions for as long as I have been working. Recently, my employer started offering the Roth 401K and I tried it out w/ a 50/50 split b/t my Traditional 401K & Roth 401K, but the increase in monthly taxes I paid was a little too painful in the near term for me to stomach.

I really do believe the Roth 401k is a better option than the traditional, but here’s my quandry. Today I’m back to contributing the maximum 20%to my traditional 401K. I would like to go back to the 50/50 split b/t Roth & Traditional 401K, but the pay cut I experience due to the raised taxes is still something I don’t want to endure. Would your recommend reducing my contribution from 20% so I could still get the same take home pay, but could contribute more to the Roth 401K? Love to hear some suggestions or things to consider…

Comment on Why a Roth 401k May be Your Best Bet by Peter Wed, 01 Jul 2009 22:44:08 +0000 Josh & Brian,
I had the same experience with Chase. My card offers 3% back on whatever 3 categories I spend the most on each month. Not the categories they decide for me ahead of time, but whatever they happen to be that month. I don’t even have to decide. And I get 1% back on all other purchases. And like Josh, I got the extra $50 if I saved up $200 in rewards. All in all it was a pretty good deal. Then I too got the letter with the “exciting changes.” Now the extra rebates are only on gas, groceries and fast food, they are taking away the $50 bonus and want to charge me $30/year for the privilege of getting fewer rewards.

I called and asked the rep if I could stay with my current program instead of the new one. He said No, they were discontinuing the existing program. I pointed out that the new program offered me less and I was definitely NOT going to pay the $30 fee. He said he understood and noted that I was a “good customer” (even though I pay my bill in full every month) and suggested that I try the new program for a while since it was free and if it wasn’t working out , they would find one of their other cards that better met my needs.

When I read the letter from Chase, my first thought was actually, “This is exactly what the Money Guy said was going to happen.” On one hand I guess it’s good that I’m financially responsible enough to be a “bad” customer for the credit card companies and they feel the need to do this. On the other hand, the reduction of benefits and having to be penalized for the excessive risks the credit card companies took stinks.

There is absolutely no way I am going to pay a fee to use a credit card. I have a feeling that in a year things will settle down a bit and it won’t be too hard to get that fee waived. And if they won’t do that, then we can all find a company that does want our business.

Comment on Why a Roth 401k May be Your Best Bet by Joshua Scott Tue, 30 Jun 2009 02:41:45 +0000 Brian,

I had to take a few minutes to post a comment about the credit card portion of the show. As a matter of fact, I haven’t even listened to the main topic on ROTH 401Ks yet but I’m sure it will be good. I was just happy to hear someone else out there was as bummed as I was with Chase’s (and maybe others?) new “upgrades!!” and “improvements!!” to their rewards programs. I too am one of your so-called deadbeats and use credit cards for all the free money they’re willing to give me while never carrying a balance and paying off my statement in full. Approximately a month or so ago I received a letter from Chase informing me that I was “in store for exciting new changes to my Chase Freedom Mastercard awards program”. As I began to read the first few paragraphs, these so-called improvements quickly turned into downgrades to anyone with a 3rd grade education. When I finally got to the fine print and finished reading the entire letter, I was not only disappointed that parts of my rewards were getting completely cut out (no more 3% on gas, grocery, and drug stores or an extra $50 when I save up $200 worth which I ALWAYS did) but downright insulted that Chase actually thinks we’re dumb enough not to see right through their failed attempt to put a positive spin on an obvious downgrade. “Are you kidding me?” I believe was my initial reaction. I immediately picked up the phone and dialed Chase’s number. I was greeted by a friendly customer service rep asking what he could do for me. After expressing my displeasurement with my new “upgrades” I asked if there was an opt-out option. I told him quite sarcastically that their gracious new offer was just too much for me and I just couldn’t possibly accept. That did manage to get a chuckle out of him and he indicated that’s how the majority of the phone calls were going for the day. I asked why Chase would be so arrogant as to actually think they could fool the public into believing the changes were beneficial and he had no response. The conversation ended when I told the representative that I would be closing the account as a direct result of these recent “upgrades” and “improvements”. So if the intention of all the VPs and bigwigs at Chase was to lose customers by removing the few incentives to actually use a credit card responsibly, then they’ve succeeded. It’s very irritating and I will stick to my American Express Blue Cash (mentioned in one of your older podcasts) until they too decide to strip me of my rewards…..oops I mean improve my rewards with fascinating new opportunities!!! ~sigh~…..


Comment on Legacy of A Generation… Not the Millionaire Next Door by LouisB Thu, 25 Jun 2009 19:03:10 +0000 Brian, I believe this is one of your most passionate podcasts to date. I really like the way you wove generations into the story – my grandparents lived through the depression, and I can still hear my grandmother forcing me to eat every last bite of dinner I took for my plate, and I remember asking my grandfather why he didn’t drink his glass of milk until he was finished eating – he always replied “to wash it down” … don’t get me wrong, my grandparents were never poor – my grandfather worked for “Public Service” all his life, working up the ranks from lineman (union side) to manager (non-union) and made a good living (I’m still running the pre-war Lionel trains he bought for my father at Christmas for my young boys) but they LIVED through the depression – heck they sat on “potato hill” in NJ and LIVED on potatoes during the great depression. They knew from life & death situations what it was to conserve and save. My parents took a hybrid approach as my father had been raised to be frugal, however my mother was quite different (opposites attract as they say!) so growing up I had a mix of unrestrained prosperity from my mother’s Italian side and (inherited?) financial restraint from my father. I have often wondered of the “watering-down” effect of the generations, and agree with many of your common-sense observations. There are many other factors contributing (as so many of the other comments point out) however I believe this argument is no less important to our understanding of our individual social responsibilities in our towns, cities, states, countries and the world at large.

Comment on Legacy of A Generation… Not the Millionaire Next Door by Dallon Christensen Mon, 22 Jun 2009 02:36:37 +0000 This comment from Rick Francis interested me, and I’d like to respond to it.

As for the importance of math and science- I think it is unreasonable to encourage children to follow technical careers so long as their skills are NOT highly valued and compensated. Consider the following: From a salary standpoint which is better degree a technical PhD or an MBA? Which takes longer and requires more math skills? Who reaps the financial rewards- the scientist that makes the discovery that enables a product or the CEO of the company that makes and sells the product? Given your answers, would you recommend your child become a scientist or a businessman?

The only businesses where the CEO/MBA makes the lion’s share of money is in large corporations. Smaller businesses will place a higher priority, and more money, on the innovation and invention people instead of the businesspeople who can squeeze another dollar of cost savings out of the corporate structure. Clayton Christensen’s body of work, including “The Innovator’s Dilemma”, shows what happens when the businesspeople are the ones making the decisions based on efficiency.

The recent negative backlash toward business may be a catalyst toward making science and engineering cool again. If my youngest brother (the civil/structural engineering major) has more people who feel like him, we will be in good shape. He wants to participate in rebuilding this country’s infrastructure instead of trying to wring more productivity out of some corporate bureaucracy. Only when more engineers think like him will we start to see the research dollars and higher salaries going to the people who actually make things.

Comment on Legacy of A Generation… Not the Millionaire Next Door by hisham Fri, 19 Jun 2009 15:08:21 +0000 I kind of agree with you that this generation of US has to pay for what they did. American now live above their mean for quite a while and the reality hit them hard. The economy falls to the very worst.

Or we can see from the spiritual site of it. American under Bush has done unjustified war in Iraq. Hundred of thousands of innocent civilians dead. God does not forget, and now US got the ‘reward’ for what they did it Iraq.

Or we also can see the common pattern or cycle of economy. It is very acceptable to most economists that in every ten years the economy will go south. That is what happening in US now, its just the cycle.

Hopefully the economy will recover soon and American will become better people!

printable fake money

Comment on Legacy of A Generation… Not the Millionaire Next Door by Peter Wed, 17 Jun 2009 01:49:05 +0000 One of the things that I think has contributed to this problem is the shift by everyone (individuals, families, businesses, industry and government) from long-term goals and rewards to a fixation on short-term goals and rewards.

Individuals are only interested in the “now’. Things that were hot, new and interesting today are old news next week. Families live paycheck to paycheck and only plan for the next week. Anything out of the ordinary that happens is a major problem. They aren’t willing to make any sacrifices to obtain bigger rewards later. Business is only interested in meeting their quotas for this quarter. CEOs don’t care about long-term progress, they’ll take their golden parachute and be gone before that happens. Industry has outsourced jobs and manufacturing to make a quick buck this year. Now they are paying the price when no one wants to buy their cheaply made products. Government borrows from tomorrow to pay for today. Politicians promise everything because they know they won’t be around when the bills come due.

Everyone and every part of the system needs to shift their priorities to longer term goals. We need to build our manufacturing base and infrastructure based on where we want to be in 10 years or 20 years, not next year. We need to keep driving our current car and save for one in 5 years, not pick up a new lease because the current ones have a cooler GPS. We need to invest in our education system to train students for the jobs they will have in 10 years, not just teach them enough to pass the tests that give the school the state funding. We need the government to cut spending and pay down the deficit, rather than promise more funds today.

There is plenty of blame to go around for this situation. The government has done plenty of reckless spending without concern for the future payments that will be necessary. Wall Street has made public companies beholden to meeting their quarterly projections. Consumers have made businesses cut every corner and squeeze every supplier in order to keep prices down. And individuals have succumbed to advertising that encourages more conspicuous consumption without regard for need or the ability to pay for it.

Longer term goals inherently mean current sacrifice and that’s not “cool” in today’s society, but that is one of the things that made this country as great as it is. In the past everyone would work together towards a common goal, be it on a federal, state, or community level. Today, no one cares about anyone else, and no one is willing to give up anything today for the unknown rewards of tomorrow.

Comment on Legacy of A Generation… Not the Millionaire Next Door by John Donaldson Tue, 16 Jun 2009 23:49:31 +0000 Brian,

Great podcast and I agree with you whole heartedly.

Over consumption, and living beyond our means is what really caused the current economic crash and it’s not over. I retired last year at age 61 by not keeping up with the Joneses. I saved about 20% of my income for many years to allow me to retire early. I knew some kind of market crash was possible but didn’t call the housing component exactly. However we did sell our home of 20 years in the summer of 2007 as the market began to slip. Still we got a great price, paid off our mortgage, and are now debt free. America has been living on borrowed money for too long, and living a life style out of sync with our income and out of balance with the rest of the world.

The reason so many jobs have been lost to other countries is it is simply less expensive. Our American salaries are not supported by our product output. If we produce identical products with higher salaries something has to give and it is usually quality. This economic “reset” is good for the country. Salaries are being brought down while salaries in the rest of the world, namely India and China, are creeping up. The gap is still large though and will take years to come into parity. Our life style will have to be reined in and our expectations have to be reset for us to balance with the rest of the world. We no longer hold claim to having superior products or manufacturing.

The biggest example I can think of is GM which seemed to ignore the trends and drove the company into the ground. The UAW pushed for more benefits which squeezed profits for GM resulting in lower quality vehicles. Workers expected high salaries (well beyond their foreign counterparts), good health care and retirement benefits. We are paying for decades of decadent living and it’s time to pay the piper.

Keep up the good work,

Comment on Legacy of A Generation… Not the Millionaire Next Door by Rick Francis Tue, 16 Jun 2009 05:36:31 +0000 Bryan,

I think over consumption in America is a much more complex problem with a lot more subtle causes. The prevalence and effectiveness of marketing has changed dramatically in the last century and the entire purpose of marketing is to increase consumption! I think television has also distorted our culture- who wants to watch the lifestyles of the poor and unknown instead of the rich and famous? The stories of superstars are much more dramatic and interesting than the boring toils of simple businessmen. I am sure that television has distorted Americans’ concept of “normal” across many aspects of life- from careers, to money, to morals. If the air time for uninteresting professions is minimal is it any wonder that kids want to be sporting or music stars? When everyone you see on TV has wonderful things, doesn’t it make you questioning your frugal lifestyle? When there are a multitude of commercials encouraging spending, is it a wonder that people do? One of the reasons that I follow financial blogs and your pod cast is to see viewpoints that value living frugally and investing wisely.

As for the importance of math and science- I think it is unreasonable to encourage children to follow technical careers so long as their skills are NOT highly valued and compensated. Consider the following: From a salary standpoint which is better degree a technical PhD or an MBA? Which takes longer and requires more math skills? Who reaps the financial rewards- the scientist that makes the discovery that enables a product or the CEO of the company that makes and sells the product? Given your answers, would you recommend your child become a scientist or a businessman?

Social Security- I agree that there has been a void in political leadership from both parties. However, I think a major reason is that AARP is a very powerful lobby that makes changing the SS system political suicide. I fear that true leadership will elude us as long as political campaigns requires massive fund raising, allowing special interests to effectively purchase our representatives. I don’t see the problems of our political system changing without campaign reform.
The change in life expectancy since 1935 has drastically changed the needs and effective purpose of social security. In 1935 most people would not have lived many years beyond the retirement age of 65. If the system had tracked changes in life expectancy the current age to get full SS benefits should be around 74! I suspect that would go a long way toward fixing the solvency problems we currently have…
A final comment- our world is changing radically at a pace I think we try to ignore. Take a look at – for an interesting perspective. In particular consider slides 26-28 when thinking of our country’s future.

-Rick Francis

Comment on Legacy of A Generation… Not the Millionaire Next Door by Matthew B. Howell Mon, 15 Jun 2009 08:16:53 +0000 I couldn’t agree more with you, Brian.

I continually strive to live below my means as well as save 20% of my income – one “trick” that I use to save is what I refer to as the “because I’m alive” tax (Every day, I put aside $20 in a high-yield savings account “because I’m still alive”). By doing this day-in and day-out at least for the next 30 years, I will amass quite a tidy sum of money. I look at the concept of saving money as a game rather than a chore – every day, I eagerly and willingly look for new ways to save money.

For people who have not yet made the decision to save money and live below their means, I implore you to start being fiscally responsible as soon as you can – the world does not owe you a living.

Comment on Legacy of A Generation… Not the Millionaire Next Door by Dallon Christensen Sun, 14 Jun 2009 03:52:05 +0000 Brian, you really made a great point about making math and science cool again. In my opinion, the single biggest “professional” flaw causing the credit crisis was the engineers trying to become financial wizards. Instead of these people using their talents to create great products and widgets, they saw the possibility of huge returns through financial engineering. Instead of finance becoming a way to monitor and fund the activities to create wealth, finance became a way to create wealth in its own right.

The explosion of engineering models in finance was incredible. Too many engineering majors thought they could apply their thoughts to create risk-free investing tools. Business and finance is not black and white like some (but certainly not all) engineers think the world is. When the “long-tail” events occurred because of human error (something that is not factored into many engineering analyses), the crisis began to accelerate.

I do not mean to pick on engineers. My brother is a future civil and structural engineer, and there are many brilliant minds in the field. My point is that instead of applying their unique talent to build great products or improve great services, too many engineers tried to get rich quickly in the financial world. Since human decisions cannot be accurately predicted by a model, the idea of risk-free financial models and instruments was doomed from the start. The rising stock market and real estate market simply masked the inevitable fall that we all should have realized was coming.

Comment on Legacy of A Generation… Not the Millionaire Next Door by Rich Sat, 13 Jun 2009 22:14:02 +0000 Your Legacy of a Generation was very well presented and thought out! Please keep hammering this home to America! Thanks!

Comment on Legacy of A Generation… Not the Millionaire Next Door by Steve Balk Sat, 13 Jun 2009 03:45:20 +0000 What fuels the current generation’s debt is best addressed in the Atlantic Monthly Article entitled “A Politics of Generation X”…..

“Since 1973, while the earnings of older Americans have mostly stagnated, real median weekly earnings for men aged twenty to thirty-four have fallen by almost a third. In fact, Xers may well be the first generation whose lifetime earnings will be less than their parents’. Already they have the weakest middle class of any generation born in this century.”

No surprise when the article later explains….

“Xers carry more personal debt than did any other generation at their age in our nation’s history; in fact, a full 60 percent of Xers carry credit-card balances from month to month. In addition, those who attend college face the dual burden of soaring tuition bills and shrinking federal education grants. From 1977 to 1997 the median student-loan debt has climbed from $2,000 to $15,000. The combination of lower wages and overleveraged lifestyles is doubly worrisome to a generation that wonders if it will ever collect Social Security.”

The good news – This generation of Xer’s (of which I am not one being that I am 47), is more politically complex and financially astutue than all past generations. They are the voice behind democratic fiscal conservatism (a paradox?), the near success of Ross Perot, and the ever louder voice of the libertarian party. In time, the present political forces that have contributed to the culture of consumption and dept will be displaced by those who understand, represent, and ultimately repair financially destructive forces of my generation and those before me. Unfortunately, it will not come without long deferred gratification….or not. Maybe the gratification comes from cleaning up the mess and living more simply. There is something to be said of a minimalistic lifestyle. Particularly if it leads to millionaire status.

Comment on Social Security, Charity Fraud, and Credit Card Deadbeats by scorp99cam Mon, 01 Jun 2009 19:57:48 +0000 Hi Brian,
I am a big fan of the show. I just listened to this podcast and wanted to make a couple comments. You asked why does governement always have to grow, even in tight times? I think it goes back to Keynesian economics. I am not sure governemt should cut back in the tough times, in fact I am ok with government growth during those tough times to prevent depression. However, that is why I think it is so important to be more fiscally responsible in the good times to lower the nation’s debt levels that it allows us to be able to kick in stimulus money or hire more government workers without building this impossible debt burden that is impossible to remove. Unfortunately, that means our representatives and president would have to make those tough choices that are politically unpopular and we end up with the huge debt we have today.

As to the fair tax, I only ask that you be FAIR in your research. It seems that the pro-fair tax people are the most vocal, so I hope you will pay attention to whether it is progressive or regressive and how taxing consumption in a nation that consumption makes up 70% of our GDP will affect our economy. And of course, how can you advertise people pay less taxes and expect the same level of government spending? Just approach it skeptically. I love new ideas and different approaches to problems, as long as the data is honest. I am not sure the fair tax people are being honest in their data. Keep up the good work!

Comment on Social Security, Charity Fraud, and Credit Card Deadbeats by Ian Mon, 01 Jun 2009 04:38:00 +0000 Hi Brian,
1) I love your poloitically independent research on finiacial issues, so that’s a yes for the fair tax podcast. I love the book but I don’t have time to do the in depth research you do and you’re good a making sense of it all.
2) Really liked the analysis on government spending vs. gdp growth. In this episode, you mentioned that the Obama budget is $600 billion more than Bush’s last budget, a 20% increase. I don’t know the true number but I know that Bush did not budget for the war and Obama did. I believe that war spending was more than $600 billion. I would be very interested in an indepth budget analysis.
Thanks for the show, I am currently in the military providing free-only financial advice but hope to become a fee-only advisor soon.

Comment on DCA: Maybe the Most Important Investment Decision You Will Ever Make by Scott Onofry Wed, 20 May 2009 15:38:28 +0000 Brian, I’m with you on the topic of keeping cash in your wallet. I find that the more cash I have in my wallet the more I spend on little things that I don’t really need. Because of this I don’t keep much cash in my wallet. It’s great to hear a different point of view besides “credit cards are evil”. If a person is responsible and pays the card off in full every month you can really take advantage of the rewards. I don’t think I’ve paid for a movie rental in 5 years because of my credit card rewards.

Comment on DCA: Maybe the Most Important Investment Decision You Will Ever Make by Brian Preston Wed, 20 May 2009 13:42:33 +0000 Charlie,

You make a great point, and I have been receiving many emails asking the same question. When I talk about Dollar Cost Averaging, I am talking about using no load mutual funds. You are absolutely correct to say that it doesn’t make sense (doesn’t pass the common sense test) to periodically purchase a stock if you are going to be charged a transaction fee every time you purchase. As for loaded mutual funds, I feel these also don’t make sense to DCA into because there are so many other alternatives out there in the no load world (Why pay 3 – 5% up front if you don’t have to?). My suggestion is to DCA into a strong ‘core’ holding with a no load mutual fund, then, as you accumulate assets, you can begin to re-allocate to fund some ‘satellite’ positions. ETFs are also very useful tools; however, since they trade similar to individual securities, you will probably run into the same transaction fee problem as you do with stocks.


Comment on DCA: Maybe the Most Important Investment Decision You Will Ever Make by Charles Eifrig Tue, 19 May 2009 18:30:46 +0000 Brian,
I listened to your podcast on DCA this morning. I enjoyed but was left wanting more specifics. For example, DCA may be inappropriate for stocks because each trade may cost a person 10-30$ which if it is an automatic investment of $100 that is 10-30% right off the top. What about load mutual funds and the expenses with those when you DCA. I think it needed to be clearer what sort of investments are good for DCA. Are ETF’s good? Are stocks good? Or is it just for savings accounts, mutual funds, etc.? i hope you can clarify and thanks for all that you do. I enjoy the content and your style!!


Comment on Is Now the Time to be Taking Risks? by Josh (the one mentioned in the episode) Sat, 02 May 2009 01:38:43 +0000 Just wanted an opportunity to post my response to Brian’s recent episode. Below is an email I recently submitted.

Hello Brian,

I just got around to listening to the new podcast today and I have to say I almost fell out of my chair when I heard you call my name and begin reading my email. I was flattered to say the least that you felt my feedback was worth sharing with your listener audience. I got so excited I called everyone I know to tell them about it before I even finished listening to the show! I have several family and friends that subscribe to your podcast as a direct result of my recommendation and are now regular listeners. I was thrilled and honored to be a part of your show.

Let me begin by reassuring you that I will remain a Money Guy listener/subscriber for as long as you continue to do so. I think very highly of you and your opinion and enjoy the free advice you’re so willing to provide. With that being said, I was grinning ear to ear as you began to read my email on the air. I had several friends gathered around my iPhone and I felt like I’d made the big time! Ha ha. It was so cool hearing someone whose opinion I hold in one of the highest regards reading an email I wrote. I was scared to death though, once the email was complete, you were going to rip me apart. I told my friends, “He’s probably going to use me as an example of some radical anti-debt extremist”. But I was pleasantly surprised you did nothing of the sort. Rather, you offered your honest opinion and counterarguments. Of course I am well aware that a high credit score can save you money in several areas such as insurance (my mother-in-law kindly reminded me of this when I read her my email I’d wrote you last week) but feel the positives of eliminating debt outweigh the negatives. Now I was unaware that you could live a completely debt free life (no credit card usage, that’s still short term debt) and retain a high credit score. I’m confused how this is possible based on how a FICO score is calculated but I’ll give you the benefit of the doubt. Do your “debt free” clients use credit cards? If so, I will argue they are not debt free. They accumulative debt on a monthly basis and then pay it off. Perhaps this is how they maintain a high score because they are still creating a debt history. Dave Ramsey always boasts a credit score of zero because he hasn’t borrowed any money (long term or short tem, no credit cards) in over 20 years. He said he tried to get a credit score one time and they informed him that his debt history did not contain enough information to determine a score and that one could not be calculated. Maybe that’s why he just says “zero”. Nevertheless, I’m going to respectfully disagree that debt is a tool. In my opinion, that statement in itself is an oxymoron. Even though you and I both use credit cards (I’m a fan of the American Express Blue Cash) to maximize that free money they’re willing to give me, I understand that I charge more with plastic than I would with cash (studies have been conducted to prove this and Vegas builds it’s whole business model on the concept). So how much money am I REALLY saving? And I even work a budget every month so that I don’t spend excessively but still, how much more am I spending with plastic? And borrowing money on large purchases that you end up spending thousands of dollars in interest on just to save a few bucks here and there with insurance really isn’t worth it is it?

But alas, I understand I don’t think like your average individual and I have been drinking the Dave Kool-Aid for several years now (I hear this quite often from family and friends). And I love that your show isn’t the Dave Ramsey Second Edition and that you’re trying to teach BEYOND common sense. I don’t need two Dave Ramsey’s. And while I agree that Dave’s audience is primarily for those that can’t spend less than they make, he offers a lot of other good advice for business owners, entrepreneurs, and everyday items such as life insurance, retirement, and investing. There is a reason I have both of you in my iPhone’s Podcasts.

So in conclusion, I want to thank you Brian for giving me my 10 minutes of fame, ha ha, and appreciate the honest assessment. You’ve always encouraged your listeners to provide feedback to your show so I hope my comments weren’t too harsh or offensive. I meant no ill intent and simply wanted to offer up some constructive criticism. I respect your opinion and advice and only wish you could be my financial advisor. However, since that is not an option, I will continue to listen to your show and use the advice in any way that I can.


Comment on How to Build Your Credit by chefrick Tue, 28 Apr 2009 01:26:59 +0000 HI Chipper,

Mr. Preston is just stating the facts. That is how credit scores work and we all have one, whether we like it or not. I was told about this when i was 17 by my economics teacher, and i have worked to have a great credit score since. It has given me the lowest rates on a mortgage, and some great credit cards with 1.5-5% returns (not apr’s).

Dave Ramsey ( I am a big fan) books are designed for, as you say,”debt-slave”s. For some people giving them a credit line is like handing an alcoholic a drink, they just can’t stop! However for someone who CAN control their budget, focusing on getting the best credit scores can benefit you for years, and save thousands. I enjoy annual cash returns from my credit card and great insurance rates.


Comment on How to Build Your Credit by Chipper Sat, 25 Apr 2009 14:06:08 +0000 Arrrrrrrgh!!!

I listened to the podcast for this week and wanted to howl. Giving advice to young people about how to build their credit score (aka their debt-slave score) is in my view like handing a 16 year old boy the keys to your sports car and liquor cabinet while admonishing him to “be careful.” The results will in many cases be both predictable and tragic.

While I realize that Mr. Preston is not always in agreement when it comes to the anti-debt philosophy such as that espoused by Mr. Dave Ramsey, I don’t think you’re doing your listeners much of a service by telling them how to be better debt slaves. It’s unfortunate that there are so few financial commentators on the anti-debt side of the spectrum. It seems as if that part of the spectrum has been abandoned to Mr. Ramsey, which is a shame as there are parts of his plan that are notso hotso. Perhaps a future podcast could be dedicated to some realistic tips for going debt free that haven’t been discussed? While I’m not a worshipper at the Unreformed Church of FICO, I recognize that we’re kind of stuck dealing with the FICO cult. Such as when you’re getting insurance; the insurance company is going to pull your credit report and FICO score regardless. The question is how do you deal with the FICO cult while staying as out of debt as is possible? I think Mr. Ramsey’s approach of simply ignoring it is probably not the best.

Comment on Liz Weston – Loaded Celebrity Interview by Brian Preston's "Money Guy" Blog and Podcast | Buyer Protection, Listener Emails, and Economic Research Fri, 27 Mar 2009 17:23:40 +0000 http://613491257#comment-2852 […] is offered by some credit card companies. If you remember a few months ago in our show interviewing Liz Weston, she shared her experience with a defective iPhone. Because her purchase was made with her credit […]

Comment on Stewart vs. Cramer and Real Estate Update by the weakonomist Fri, 20 Mar 2009 02:15:39 +0000 Brian,

Thank you for including your thoughts on the Cramer/Stewart media hype. While Stewart’s initial rant had many truths and was very entertaining, the finance community did not have a good response and they needed one.

I figured you might have some thoughts so thank you for sharing, that is exactly what Cramer should have said.

Comment on Dave Ramsey: Financial Planning Guru … or Charlatan? by Kees Fri, 06 Mar 2009 03:20:45 +0000 Well,

My first question to SOW has still not been answered (a side by side comparison of cost and benefits).

My guess is that we will never see it.

Comment on Dave Ramsey: Financial Planning Guru … or Charlatan? by Ignorance is NOT Bliss Thu, 26 Feb 2009 05:19:46 +0000 This debate between term and WL is unproductive because both parties believe the other one is wrong. WL is not for everybody. I have to side with Sow on most cases, EXCEPT the “be your own bank” thing. This is a dangerous concept, because when our socialist government starts taxing the loans you take against your policy’s cash value, this concept will be destroyed. And WL from any company other than the top 3 or 4 mutual companies is not to be compared. WL is about the permanent death benefit, that allows people to unlock other forms of income. A person with 1 million of assets and 1 mil of WL will outspend and live a much more fruitful retirement than someone with 2 mil of assets and 1 mil of term (and most likely that will be cancelled when they turn 65). Those of you that drink the buy term and invest the difference koolaid might end up okay (if you are disciplined investors), but the guy next to you that used WL (and NOT as a banking system) to leverage his other assets and perhaps avoided the 401k trap, he is going to feel bad for you.

It is about DISTRIBUTION folks, people focus on accumulation too much with no idea of how they are going spend it or distribute it in retirement so that they are getting the most efficient and maximum use of every dollar.


Comment on 529 College Savings and ‘The 2009 Stimulus’ by College Savings–Advantages and Disadvantages | Savings For College Mon, 23 Feb 2009 18:24:58 +0000 […] Brian Preston’s "Money Guy" Blog and Podcast | 529 College Savings … […]

Comment on Should You Prepay Your Mortgage and Mutual Fund Opportunities by Dave Ramsey’s 7 Baby Steps: Step 6 - Pay Off The Home Early! | Bible Money Matters Mon, 23 Feb 2009 16:08:06 +0000 http://858588870#comment-2846 […] On the other hand if you look at the numbers logically,  not paying off the house early really does seem to make more financial sense. With a historical stock market return of almost 12% in the long run, there aren’t many cases in which prepaying the mortgage can make more financial sense.  In fact, if you’re looking at a 15 to 20 year window of home ownership, in the past an investment in the S&P 500  index would have been a better investment 100% of the time! […]

Comment on Bringin’ Simple Back by chipper Sat, 14 Feb 2009 02:41:28 +0000 This was a really good podcast. Went over a lot of topics, but did a good job. I did disagree with Mr. Preston over one issue, though, and that was regarding debt. Mr. Preston indicated that carrying up to 36% of gross income as debt is acceptable. I strongly disagree.

Debt is a bad thing. Period.

While I realize that most American households are up to their eyeballs in hock, the fact that most people are in debt does not make it normal or acceptable. much of the economic problems we’re seeing right now are as a result of deleveraging en masse. That’s not to mention the spiritual, moral, and personal finance problems that debt causes.

I found it ironic that the podcast discussed interest rates received on savings/checking accounts. And that there is one bank offering about 4% interest on savings. And that is a good deal. Most people are earning significantly less.

Now let’s ask how many people out there are paying 4% or less on their mortgage? Very few. Most people are paying more. And for car loans or other debt, they’re paying significantly more than 4% on debt. If we view the interest avoided on paid off debt as a return on investment, paying off debt turns out to be an excellent investment. Certainly better than what the stock market has been delivering in recent days. I’m kind of surprised that Mr. Preston missed that angle.

Comment on Year of the ‘Re’ – Refinance and Rebalance by David Horn Wed, 11 Feb 2009 14:53:14 +0000 How can I get the 1-16 show? I was behind on listening to you and deleted the duplicate show and now can’t get the 1-16 show. I am on ITunes.

Comment on Protecting Yourself From Fraud by Dan Jordan Wed, 11 Feb 2009 06:51:49 +0000 Thanks to Peter for his written response and Brian for his response on the latest podcast. Part of my confusion was that, after listening to the two podcasts I cited, I couldn’t decide whether Brian thought social security was a basically useful idea in need of tweaks or a basically bad idea that should be eliminated.

My surprise at the Ponzi label was partly because a Ponzi scheme, to me, implies dishonest intention by the people who are orchestrating the scheme. Wikipedia’s entry for “Ponzi Scheme, in its first sentence, has the description “fraudulent investment operation,” for instance. No fraud is intended with SS but rather good will. I do understand that structurally there’s similarity between SS and Ponzi schemes.

I wonder, however, if the idea of SS as more like income *insurance* isn’t a more appropriate analogy — albeit an insurance policy whose premiums evidently need to increase (or the policy payout needs to go down, or the age at which the policy payout commences needs to increase, etc.). I have to say I have always thought of SS as income insurance. SS just seems to more closely match the elements of an insurance plan than a Ponzi scheme. I may be mistaken; I’m no expert; that’s why I like to listen to Brian’s podcast and get better educated about this stuff.


Comment on Money Guy Q and A… Year of the ‘Re’ Take 2 by Shawn Wed, 11 Feb 2009 05:01:07 +0000 Once again love the podcast.

In the replay of year of the re you talked about re-balancing your portfolio once a year. The plan that my employer uses makes this very easy to do; however, it defaults to once a quarter. Is there any concern with re-balancing too often?


Comment on Money Guy Q and A… Year of the ‘Re’ Take 2 by Matt Tue, 10 Feb 2009 04:47:52 +0000 Big fan of your podcasts. Only my 2nd podcast, but so far so good. I’m a grad student interested in learning more about what all is going on with the financial situation today. Thanks. I will certainly recommend you on my blog!

Comment on Protecting Yourself From Fraud by Peter Tue, 10 Feb 2009 02:29:39 +0000 Dan – Regardless of Brian’s opinions about Social Security it is technically a Ponzi scheme. The system doesn’t have enough money to bankroll current retirees, so it pays them directly with the money it collects from current workers.
If it wasn’t a Ponzi scheme, current retirees would be paid only from the investment profit of their own contributions. With your own retirement investments, it is your own contributions that grow into whatever is paid out to you when you retire. You don’t get the money that new investors are putting into the stock/fund/ETF. The investment manager has the money it needs to pay ALL investors “in the bank.” With a Ponzi scheme there is never enough money to pay ALL investors, that is why new investors are constantly needed, and that is the current situation with Social Security. The only reason it continues to work is because workers are basically forced into the “scheme” so the there is a constant influx of new investors.
When they speak of Social Security “failing” it is because the number of new workers (investors) isn’t keeping up with the number of retirees who need to be paid. At some point the system will be taking in less money that it needs to pay out, which is exactly what happened to Mr. Madoff.

Comment on Dave Ramsey: Financial Planning Guru … or Charlatan? by chipper Sun, 08 Feb 2009 15:53:14 +0000 An interesting podcast. I’d like to hone in on one part of the podcast where Mr. Preston disagrees with Mr. Ramsey about foregoing Roth IRA contributions and 401(k) matches during the first three steps of the “Total Money Makeover.”

With all respect, I think that Mr. Preston is focusing on the twigs on one tree and missing the forest. Let’s look at Roth IRA’s first. Mr. Preston expressed concern that professionals may lose the ability to contribute to Roth IRAs and hence lose the compounding on those funds in future years. We’re talking a relatively small portion of the population that is going to be in this “dilemma” such as it is. If you look at the statistics for 2006 (source census bureau), the lower limit for the top 5% of household income is $174,012. Said another way, 95% of households earned less than $174,012 in 2006. Given the current economic situation, I doubt that number has changed much. The phaseout for Roth IRA’s for 2009 for married couples is $166,000 to $176,000. So to put this all in perspective , we talking maybe 5-7% of households are in the situation where they can’t contribute to a Roth IRA. Perhaps due to the nature of his clientele Mr. Preston is used to running into these individuals, but from the point of view of the population as a whole they’re a relative rarity. Mr. Preston is also failing to note the other side of this equation. If someone is using the $5,000 or $10,000 they would otherwise contribute to a Roth IRA to pay down debt, they’re saving the interest on that amount. Since the average credit card rate is 14.03% (source credit card monitor), you have to take a look at the amount of interest saved when doing this. I’m not aware of any investment that is paying a consistent after tax return of 14.03% or even 10%, so that’s something that Mr. Preston’s analysis is missing. And keep in mind that most interest paid except for that on a mortgage is not tax deductible.

With regard to 401(k) matches, Mr. Ramsey has a tougher sell in my view. Yes, it’s tough to make the argument that giving up a 33% or 50% or even 100% return on investment makes sense. And in truth, I disagree with Mr. Ramsey on this for people in a situation where they have relatively low amounts of manageable debt. But keep in mind that the people that Mr. Ramsey speaks to are often in well over their heads and need a dramatic approach. Mr. Ramsey is indeed correct when he notes that most of personal finance is psychology. And if the thought of losing that return on investment represented by matching contributions to your 401(k) is enough to motivate you to dive in and pay off your debts, I think it’s a relatively small price to pay given the long term benefit of being out of debt.

Comment on Protecting Yourself From Fraud by Brian Preston's "Money Guy" Blog and Podcast | Money Guy Q and A… Year of the ‘Re’ Take 2 Thu, 05 Feb 2009 18:20:33 +0000 […] on some of the recurring questions I receive from listeners. One that I’ve seen a lot since the ‘Protecting Yourself from Fraud’ podcast is what are my true feelings on Social Security? Well, I really do believe it is the […]

Comment on Year of the ‘Re’ – Refinance and Rebalance by Brian Preston's "Money Guy" Blog and Podcast | Money Guy Q and A… Year of the ‘Re’ Take 2 Thu, 05 Feb 2009 18:20:02 +0000 […] that I have decided to tag it on at the end of this podcast. So, if you are trying to locate the ‘Year of the ‘Re’ podcast, you can fast forward about 35 minutes into the show and it will be […]

Comment on Dateline and Equity-Indexed Annuities by Jim Petersen Fri, 30 Jan 2009 07:14:03 +0000 After listening to this pod cast, I just can’t help but to think what he would be saying now that the stock market has dropped 40% in the last year. Equity Indexed Annuities are about protection – not max growth. If you invest in an indexed mutual fund, you have a huge downside risk. This is not meant for seniors obviously due to the charges if you trying to pull the money out in the first 7 to 10 years, but for 40 to 55 years old who are savings aggressively (I said savings – not chasing returns) for retirement, these products have a place. You can find participation caps as high as 12-14% and 140% participation rates (so you get a higher than the index return as long as it is less than the cap).

Comment on Bringin’ Simple Back by Josh K Wed, 28 Jan 2009 19:10:22 +0000 I don’t know if it’s my browser or what, but I’m having problems listening to the podcast over the web. It seems to have an infinite loop in there somewhere and I never got to hear the end

Comment on Year of the ‘Re’ – Refinance and Rebalance by Tage Wed, 28 Jan 2009 05:07:23 +0000 What was that quick equation you used for determining if you should buy the “point” or not? I didn’t see it on your website notes. Seems like it was very useful, but can’t remember it. Thank you!

Comment on Bringin’ Simple Back by Single Guy Money Mon, 26 Jan 2009 16:44:17 +0000 I agree with having 24 months of cash reserves. I know most people think having too much cash is a bad thing. I prefer to keep large amounts of cash in my savings account because that is what makes me feel secure. I couldn’t imagine only having a six month Emergency Fund.

Comment on Protecting Yourself From Fraud by Dan Jordan Mon, 26 Jan 2009 06:48:52 +0000 I listened to the “Protecting Yourself From Fraud” podcast and was surprised to hear you call social security the biggest Ponzi scheme in history, and that you *hate* social security. I’ve listened to a lot of your podcasts and, except for this one, consider you a pretty moderate financial commentator. These Ponzi/social security comments, however, were quite jarring.

I went back and listened to your 12/10/2007 podcast in which you had a fuller discussion of social security. You still insisted social security was a Ponzi scheme but you moderated such a conclusion with discussion in which you described social security’s problems but basically stated social security was a good thing but which needed to be adjusted, and sooner preferably than later.

The contrast between your attitudes in the two podcasts seemed striking and inconsistent. You concluded the present podcast’s discussion of social security by saying all Ponzi schemes fail. By extension you were suggesting social security will fail, since you clearly consider social security a Ponzi scheme. And yet in the 12/10/2007 discussion you seemed clearly to believe social security needn’t fail if adjustments were made.

I can’t figure out what your true position on social security — and its status as a Ponzi scheme — is.


Comment on Year of the ‘Re’ – Refinance and Rebalance by Brian Preston Sat, 24 Jan 2009 21:29:25 +0000 Yeterday I renamed the file to see if iTunes would reload the podcast. It did not work, but I was able to delete the original podcast and then download the show directly from our page on iTunes. Sorry for the confusion. I may repost the show at the first of next week, so that iTunes will redistribute the show to everyone again. Hopefully, listeners will not be annoyed with a duplicate show being reposted. Thank you for your patience and the desire to not miss a show.


Comment on Year of the ‘Re’ – Refinance and Rebalance by Sam Fawaz Sat, 24 Jan 2009 12:55:07 +0000 iTunes still had the duplicate episode from 1/8/09 for 1/16/09 as of this morning. Please re-title or something to get it to work. Keep up the great work Brian, thanks!

Comment on Year of the ‘Re’ – Refinance and Rebalance by Sam Fawaz Sat, 24 Jan 2009 12:52:56 +0000 As of this morning, iTunes is still downloading a repeat of the Madoff podcast from 1/8/09 for this podcast. Thanks for all your hard work Brian

Comment on Year of the ‘Re’ – Refinance and Rebalance by Brian Preston's "Money Guy" Blog and Podcast | Bringin’ Simple Back Fri, 23 Jan 2009 21:11:22 +0000 […] Allocation – check out last week’s show notes for a link to a great asset allocation tool from […]

Comment on Protecting Yourself From Fraud by Brian Preston's "Money Guy" Blog and Podcast | Bringin’ Simple Back Fri, 23 Jan 2009 21:10:50 +0000 […] get you access to the best ‘private placement deals’. Hey, maybe even somebody as successful as Bernard Madoff could have managed your portfolio? If you had any equity in your home, you should liquidate it and […]

Comment on Year of the ‘Re’ – Refinance and Rebalance by Chris Barry Wed, 21 Jan 2009 01:26:22 +0000 Brian,
I use iTunes, and this week’s podcast on Refinance is still a repeat of the last one on fraud. Can you try giving it a slightly different file name, so iTunes will download it? Thanks!

Comment on Year of the ‘Re’ – Refinance and Rebalance by Brian Preston Sat, 17 Jan 2009 21:42:39 +0000 Sorry about the bad link that sent everyone back to last week’s show. Everything is all fixed now. Thank you for listening and sorry for the bad link.

Comment on Year of the ‘Re’ – Refinance and Rebalance by Rob Sat, 17 Jan 2009 20:16:30 +0000 It seems like the most recent podcast posted here and on itunes is just a duplicate of the Madoff podcast from 01/08/09.

Comment on Year of the ‘Re’ – Refinance and Rebalance by Danny Quon Sat, 17 Jan 2009 02:47:22 +0000 Brian,

I uses iTunes to manage my podcasts. Today, I downloaded your latest podcast “Year of the ‘Re’ – Refinance and Rebalance” and discovered it was the prior podcast “Protecting Yourself From Fraud”.

Not sure what happened but wanted to inform you.

Keep up the good work!

Comment on Protecting Yourself From Fraud by the weakonomist Sat, 10 Jan 2009 05:32:33 +0000 My big thing was the failure of Bernie’s investors to demand more details on how he’s making money. This was a mistake at the most basic level, don’t invest in something you don’t understand. No one invested with Madoff knew what he was doing.

Comment on Unusual Times require Creative Solutions by Shan Krishnan Fri, 26 Dec 2008 21:15:33 +0000 Hi Brian

I do not have an economics background, but my 2cents on Mark’s idea is that it is not how the monitory system work.

When you ‘pay down’ the loan, it ‘destroys’ wealth – in other words, the amount that you pay down reduces the total available currency supply by that amount – in other words, the banks dont have the money to work with.

I work for a bank, so this much I understand.

Money is created from thin air (practically) by the banks when a loan is made out. This is subject to Reserve Ratio requirements ofcourse. This money when deposited in a low or no interest savings account, becomes a free gift TO the bank. I.e. the bank uses the money to lend out, invest etc and make money off the money you keep in the bank.

When you take the money from your no interest savings account – first you are starving the bank of the free cash. Second when you pay down the principal with it, you are removing the currency from the supply.

Double Wammy. No offenses, but bad Idea Mark/Brian.

Comment on Closing Out 2008 with a Challenge and Books by Harry Thu, 18 Dec 2008 20:49:59 +0000 Brian,

I enjoy your podcasts very much. It is good to have someone like you (non-Wall Street, non-media celebrity) trying to help individual investors.

Several months ago you had received some negative feedback regarding the regularity of your podcasts. Here is my input: those like myself , who have ever published a newsletter, a column, or a podcast know what you know. It requires incredible discipline to produce at the designated intervals. It was one of my hardest-ever commitments. You have loyal listeners who want to hear from you. So, the more regular the better. This is the reality of being a podcaster, columnist, newsletter editor. We listeners will continue to enjoy Brian, the hobbyist podcaster. You are a respected professional at your ‘day job’ . Approach your hobby equally so. However, if you are really pressed for time, produce just a short segment for your audience and tell them when you will be back with them.

Just an opinion!

Best wishes for a good holiday and much continued success.


Comment on Closing Out 2008 with a Challenge and Books by Brian Preston Thu, 18 Dec 2008 14:44:12 +0000 Sarantos,

Thanks for taking the time to write a comment. I completely agree that the big Investment Banks on Wall Street played a large part in our current financial situation. In past shows I have expressed my anger about their greed and excess. However, in this most recent post I was focusing my attention on the auto industry.

I never mentioned getting rid of the unions… I just want American owned auto manufactures to be able to compete in the world market. Currently the Big 3 have much higher labor and legacy costs then their competitors that have opened facilities in the US. I am quite sure that Toyota, Honda, and BMW do have to pay for the health insurance of their American Employees that work in US facilities.

I do not want politics to leak into the Money Guy show. I just want what is best for the economy and what will make the Big 3 stronger and more competitive in the coming years.

Comment on Closing Out 2008 with a Challenge and Books by sarantos Thu, 18 Dec 2008 13:48:55 +0000 Brian, where is your compassion? why are you mixing politics in the financial markets?

why aren’t you indignant about the bonuses that bank traders will get because the Bush administration only limited bonuses if they sold assets to the government?

Merill Lynch, Morgan Stanley, BoA traders made huge bonuses on Mortgage backed security trading and they are back for more, even after the bailount.

Why you and the red states apply a double standard? Japanese and European companies don’t have to worry about health insurance – government provided.

Killing the unions won’t save anybody, changing our thinking will.

Comment on Dave Ramsey: Financial Planning Guru … or Charlatan? by Rainer Mon, 08 Dec 2008 22:14:41 +0000 Mortgage Pro: I believe you were quoting JD, not me.

I agree that usually the weakest, poorest, and least responsible portion of our society are clearly NOT listening to Dave, and are more likely listening to music stations. Educated and responsible individuals are listening to Dave to help understand money, which was never taught to any of us in school. Often we can’t get enough of it! 🙂

Comment on Unusual Times require Creative Solutions by Sam Fawaz Thu, 04 Dec 2008 18:24:40 +0000 Hi Brian,

Thank you for the excellent work you do. It appears that it is no longer possible to “download” mp3’s of your older podcasts via your web site. iTunes only goes back to 7/10/08. Is there a way to download the older podcasts from your site in MP3 form? Thanks, Sam

Comment on Dave Ramsey: Financial Planning Guru … or Charlatan? by MortgagePro Thu, 04 Dec 2008 07:56:15 +0000 Rainer:
“What you are talking about, and what Dave’s audience is made up of – are the weakest, poorest, and least responsible portion of society. ”

I make over 300k per year and have run a multi-million dollar income producing business, I listen to Dave Ramsey’s radio show and know plenty of my peers that know of his show – FYI

Comment on Thanksgiving is Around the Corner: Time to Harvest by William Carpenter Tue, 02 Dec 2008 05:09:57 +0000 I have been listening to the podcast for a while and find a lot of information on them. I am however surprised that not incorporated into your podcast that was any mention of individuals possibly taking advantage of having capital gains that fall into the 15% bracket to take advantage of the preferential rate that we currently have. I felt that it would have been good additional information that some could use.

Comment on Unusual Times require Creative Solutions by Tom Scheu Wed, 26 Nov 2008 15:44:42 +0000 I think the tax incentive to reduce make additional contributions towards your mortgage principal would be a win-win for all parties. Because this is privately-held money, the banks could use the cash any way they choose, including to buy other distressed assets (Banks without liquidity) for pennies on the dollar in lieu of lending the money or modifying their existing loans already in default but not yet foreclosed. However, banks make their profit by giving loans, and they will start doing this again as soon as they have liquidity and reasonable risk-reward ratios exist. I believe there is already much demand for loans with reasonable risk-reward ratios; liquidity is what’s missing.

A program was recently introduced to me that allows people to rapidly build-equity by paying-off their mortgage (and other debts) in 1/3 – 1/2 the time without refinancing and with little to no change in their lifestyle/cash flow. Do you think this is possible? If not, I understand how you feel. I felt the same way. Can I tell you what I learned when I did my due diligence? Information is available at This is an incredible program that helps the average American solve one of the biggest problems facing us today: overwhelming debt. Help be part of the solution. help yourself get out of debt, and if you want to help others get out of debt without spending your money, tell them about this program.

Comment on Unusual Times require Creative Solutions by Jason Tue, 25 Nov 2008 00:46:51 +0000 I really liked the idea about debt paydown tax credits. It’s fresh ideas like these that I think can help us get back to a healthy economy without having to mortgage our future. Thanks to Brian for mentioning this on the podcast I listed to today, and thanks to Mark in Colorado for the great idea. I’m sure more good ideas are out there and I hope people continue to discuss them

Comment on Unusual Times require Creative Solutions by John Lopker Sun, 23 Nov 2008 16:06:52 +0000 Hi Brian,
Love your show! I listen to your podcast every week. A couple of months back you mentioned the Morningstar podcast, but I can’t find it anywhere. I am a Morningstar premium member, and have looked several times for it. Can you tell your listeners the URL to subscribe? I found the Morningstar Advisor podcast, is this the same one you recommended?

Also, do you think that 2008 is the year “buy and hold” investing died? That might be a good topic for your show, b/c that is what many people are thinking. We have lost confidence in the system, especially when we do everything right (DCA into 401K, buy and hold, then lose 50% ) and then we see that the high-paid Wall Street gamblers who caused this mess get bailed out, and paid bonuses to boot! And though our small businesses fail if we do not produce value for the marketplace, the GMs and Fords and AIGs ask us, the taxpayers, for a handout all the while taking home tens of millions a year in salary and bonuses. In short, do you think 2008 is the year capitalism died?

Finally, do you like TIPS now, for the long-run? (In other words, do you see high inflation in the next 5 or 10 years?, perhaps after a brief deflationary period?)

Thank you, and keep up the great work.

John L