Elizabeth Ayoola
Appearances
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Going back to Gerson's question, how can people determine how much liability coverage they might need? Elizabeth, I think people can think of this in terms of tiers.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Lisa, I just want to say I have never heard such an engaging explanation for car insurance, so thank you. I have another follow-up question, which is, what would the next tier cover?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Lisa, I don't want anyone coming after me for $2 million either. So I'm definitely going to consider this umbrella policy. So Sean said these policies can be a good deal. What does that mean in practical terms?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
So guys, it sounds like you're saying that you have to think about your risk tolerance in some cases, right? To see what level of insurance that you need.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
All right, Lisa, can you think of any other coverages that people might not think of as important but are worth considering?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Are we seeing some economic declines now? The economy has been fairly healthy in the last couple of years, despite the elevated inflation, right?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Those are some good tips. I'm definitely shopping around every few months to see if I can get anything cheaper. Do you have any other tips for how folks can save money on their auto insurance? I know in the past when I've called trying to lower my insurance, they've offered discounts in exchange for tracking my driving habits, which I think is also known as telematics. So what do you think, Lisa?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
And here's our brief disclaimer. We are not your financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances. This episode was produced by Tess Vigeland. Hilary Georgie helped with editing. Megan Maurer mixed our audio. And a big thank you to NerdWallet's editors for all their help.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
And I'm Elizabeth Ayola.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Car Insurance 101.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
And those must-haves are essential expenses, including your rent or mortgage payment, transportation, food, utilities, insurance, and minimum loan payments. At NerdWallet, we usually recommend the 50-30-20 budget. That limits must-haves to 50% of your after-tax income, 30% to wants, and 20% to debt payments and savings.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Addressing your debt now is also critical, whether it's a student loan, an auto loan, or a credit card. Interest can add up quickly, so you might consider moving high-interest debt to a credit card with a 0% APR offer on balance transfers. And of course, making extra payments on any high-interest debt now will put you in a better position if times get tough.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Today, our news colleague, Anahil Hoski, is here to talk with us about recessions. So, Anna, are we in a recession right now? Are we in danger of entering one? Should people be preparing?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Sure thing. Up next, we're answering all your burning questions about car insurance. But before we get into that, a reminder to send us your money questions. Are you wondering the best way to manage investments ahead of a recession or what this uncertainty might mean for your financial goals? Whatever your question is, leave us a voicemail or text us on the Nerd Hotline at 901-730-6373.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
That's 901-730-NERD. Or you can email us at podcast at nerdwallet.com.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
To help us answer Gerson's question on this episode of the podcast, we are joined by Lisa Green. Welcome back to Smart Money, Lisa. Thanks so much, Elizabeth.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Wow. I know nobody asked me, but my biggest fear is dying in a car accident. Let's talk about the different coverages you're paying for with car insurance. Lisa, can you run through maybe the top three most important coverages people should keep in mind as they look for car insurance?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
All right. Now, hold on. Not so fast. Let's take a step back and get into what we mean by a recession and what is stoking some of those fears right now.
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
Is this the R word, Sean?
NerdWallet's Smart Money Podcast
How to Get Ready for a Recession and Choose Enough Car Insurance
So Lisa, it sounds like liability coverage is the most important for many people. So can you tell us what goes into liability coverage?
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
For sure. Yes. And that's awesome. And on that note, we are going to answer some of your questions, Maddie, to hopefully help you get on the right path and make your own decisions that's best for you and your family. All right. Please tell us what is your first question?
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
And I'm Elizabeth Ayola.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
Yeah, so for listeners who are maybe unaware of what it is, essentially it's just about investing in companies that align with your personal and your ethical beliefs. So for example, maybe you don't want to invest in companies that contribute to the military industrial complex, or you don't want to contribute to companies that have a history of polluting the environment.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
Those are examples of ESG that you might be pulled to. So probably the easiest way to invest when it comes to ESG is to open a robo-advisor account and then invest in an ESG fund. But before we go into that, to your point, Maddie, I think it really depends on your values to say whether it's worthwhile to do ESG investing. Yes, you're right. Some companies do greenwash and nothing is 100%.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
It kind of makes me think you guys can throw tomatoes at me if you think this is a bad analogy. But it's just like people who are like, oh, there's no point of trying to save the planet because what's my little contribution going to do, right? And while it does require a lot of people to contribute to make a huge impact, it doesn't mean that your contribution is zero.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
Now, that's a good analogy.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
Ouch. That hurts almost as bad as these exasperating puns, Sean. And yes, I'm egging you and these puns on because that's what a supportive co-host does.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
So you said that you, which is great on you for calculating around how much you guys need in your emergency savings fund. So did you have any thoughts about what you wanted to do with the other half? If you did, let's say, put aside that $27,000 or six months worth.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
I know all too well, eggs are a staple in my refrigerator, so I've been experiencing the hike in real time. For those wondering the why of it all, there are a few factors at play, but the key driver is the ongoing H5N1 or avian flu crisis. Now, in the last three months of 2024, more than 20 million egg-laying chickens in the U.S. died due to bird flu, including cold birds.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
And I will just give a personal anecdote. And that is, I have a son and I was also in your position, like I'm not sure whether to open a 529 or whether I should open a Roth. So I actually started out with a Roth. And then when the Secure Act 2.0 was passed and it was possible to roll unused funds, as Sean said, into a Roth, I leaped at the opportunity to open a 529 as well.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
So all that to say, it is also possible to have both. It doesn't have to be either or.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
To find out how we got here and what's being done to battle the avian flu and the prices you pay at the store, we have our news colleague, Anna Helhosky, here to talk us through it. Hey, Anna.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
This episode was produced by Sean and Tess Vigeland. Hilary Georgie helped with editing. Megan Maurer mixed our audio. And a big thank you to NerdWallet's editors for all their help. And here's our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
No, that's not the news any of us is hoping to hear.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
It's not just the scramble you order at brunch. It's anything that needs to be made with eggs, like baked goods, pasta, my protein shakes.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
You got it. Sounds so bad for the chickens. But what happens to the farms? That's a lot of loss.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
For those who don't know, the FDA investigates foodborne illness outbreaks as well as other food inspections. That seems concerning for food safety, especially while the bird flu is ongoing. Yeah, it's not an ideal situation. One thing I'm wondering is what happens to the eggs that have already been laid and sent to the market if bird flu is later discovered in a flock?
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
No problem, Sean. Up next, we answer a listener's question about ethical investing. But before we get into that, a reminder, listener, to send us your money questions. Maybe you're wondering how to save money on groceries when egg prices are sky high, or you're trying to figure out the best way to fund a home renovation.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
Now let's get to this episode's money question. That's coming up in a moment. Stay with us.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
We're back and we are answering your money questions to help you make smarter financial decisions. This episode, we're joined by Maddie, a listener with some questions about how to get started ethically investing, how to manage their savings and more.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
Hi, I'm happy to be here.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
I do, Sean. I pay attention to where my money is going and how it's being used. And I try to make sure it aligns with my personal values.
NerdWallet's Smart Money Podcast
Egg Prices, Greenwashing, and Smarter Ways to Invest
Well, first of all, Maddie, I want to say that you're very brave and you're doing a great job. Oh, thanks. And you're on the right track. I think being cognizant of what your blocks are when it comes to money and being aware of where you need to improve are like great steps. So with that said, my question for you right now is what is your relationship with money?
NerdWallet's Smart Money Podcast
Managing the Job Market and Your Parents’ Finances: Tips for the Sandwich Generation
Elizabeth, do you enjoy sandwiches? I do enjoy sandwiches, Sean. And actually, I had a fire chicken sandwich two days ago and I had an egg sandwich yesterday. And of course, no cheese because we are lactose intolerant over here.
NerdWallet's Smart Money Podcast
Managing the Job Market and Your Parents’ Finances: Tips for the Sandwich Generation
And I'm Elizabeth Ayola.
NerdWallet's Smart Money Podcast
Managing the Job Market and Your Parents’ Finances: Tips for the Sandwich Generation
Mmm, the sandwich generation. I am inching my way closer to that cohort.
NerdWallet's Smart Money Podcast
Managing the Job Market and Your Parents’ Finances: Tips for the Sandwich Generation
Today, we're talking about the labor market and how we, the public, are feeling about the economy. NerdWallet actually has a new report looking at our perception of how things are relative to what they really are. Our news colleague, Anna Helhosky, is here with more. Hey, Ana. Hey, Elizabeth.
NerdWallet's Smart Money Podcast
Managing the Job Market and Your Parents’ Finances: Tips for the Sandwich Generation
Hey, thanks, Ana.
NerdWallet's Smart Money Podcast
Managing the Job Market and Your Parents’ Finances: Tips for the Sandwich Generation
Thanks, Sean. Up next, we answer a listener's question about how to help manage aging parents' finances while also dealing with your own financial stresses as a parent. But before we get into that, a reminder, listener, to send us your money questions.
NerdWallet's Smart Money Podcast
Managing the Job Market and Your Parents’ Finances: Tips for the Sandwich Generation
Maybe you want to know whether high yield savings accounts are still the best place to house your savings or how to get your credit in shape to buy a house this year.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
So to help us answer this listener's question, on this episode of the podcast, we are joined by NerdWallet personal finance writer, Lauren Schwan. Welcome back to Smart Money, Lauren. Hello. Thank you. Let's start by talking about what Bailey mentioned about marriage and taxes, because the alleged tax breaks are a big draw of getting married for some couples.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
So firstly, Sean, can you break down what people should know about this?
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
Listeners may remember way back last fall when there was a lot of talk about economic vibes and how they didn't seem to match up with what national statistics were telling us about the economy. I am a listener and I will say I was also confused by the mismatch between musing shared in my social networks and the economic data that we were presented with.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
Thanks for breaking that down, Sean. So Lauren, you're the only one who is married here. Did getting married change your and your husband's tax situation much?
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
Absolutely. So Lauren, it sounds like this listener's partner experienced something really terrible with their finances a few years back, and they're still trying to recover from that. But even if the listener and their partner do get married, the credit issues that the partner is dealing with won't port over to the listener's profile, right?
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
So Lauren, as we mentioned earlier, you are married. So how did getting married change your financial life? Did you have any like, why did nobody tell me this moment or things that you didn't expect?
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
All right, Lauren, can you share some thoughts about how couples can help support each other financially for anyone listening out there?
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
This episode was produced by Sean and Tess Vigeland. We had editing help from Pamela De La Fuente and Hilary Georgie. Megan Maurer mixed our audio. And here's our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
Dream weddings, tax breaks, sometimes love too.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
Up next, we're going to answer a listener's question about some of the more nuanced financial implications and benefits of marriage. But before we get into that, a reminder, listener, to send us your money questions. Maybe you're trying to figure out how to better your credit so you can buy a home this year, or you need some help figuring out which financial goal you should prioritize.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
Either way, leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD. You can also pop us an email at podcast at nerdwallet.com.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
Now let's get to this episode's money question. That's coming up in a moment. Stay with us.
NerdWallet's Smart Money Podcast
Marriage and Money Myths — and Why the Economy Feels 'Off'
And I'm Elizabeth Iola.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
And I'm Elizabeth Ayola.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
I think, Amy, the things that you're thinking about are valid. And I also want to validate you by saying my retirement number was around two million something. And I was like, well, how the heck am I supposed to save all that money? So I understand how it feels to be freaked out by the number that you get. But I also want to ask you, How do you and your husband manage your household finances?
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
And also kudos to y'all because it's not easy being a full-time gig worker or entrepreneur or creative and having that uncertainty. So how do you guys navigate managing your household finances with your income?
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
Okay, so if your head is spinning from the tariff news in the last week or so, you're not alone. Our news colleague, Ana Helhosky, is here to help sift through what this means for our finances and how best to manage the impact, including basics like how to save on groceries. Ana, you've been tracking the play-by-play of this drama, but what do people need to know right now about the tariffs?
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
So I know that you said that you guys work as a team, but you kind of have separate finances. So during retirement, do you guys plan to pull your finances together or you're going to spend your retirement money and he will spend his?
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
So then I have another follow up question. So I know you asked us about maybe how much do you need to save for retirement, right? So when you ask that question, do you mean separately or as a couple?
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
And I would like to circle back, Amy, because in my past time, well, no, my present time, I love to play with retirement calculators, a very strange hobby. You mentioned that you and your partner have done that. Yes. But I do want to point out that seeing a big number like 2 million can feel very intimidating. I want you to also remember that you're not saving 2.5 million on your own, right?
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
So you're investing a smaller amount with the hope that it's going to grow over time into the amount that you expect to need for retirement. And I fell into that trap recently as well. And I'm like, oh my God, I'm so far from my goal. And then I forgot for a moment that my money's going to compound over time and it will start multiplying itself essentially.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
So for those who are listening who don't understand a compound interest, you earn interest on your interest in investment accounts, effectively allowing your investments to snowball. And the acceleration of growth is often much more rapid in the final years of retirement. So all that is to say your money's going to grow over time.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
So you want to think about your retirement savings in terms of what you might need on an annual basis versus the total number. But if you are behind on your retirement savings, you have a few options. I think the four main options that you have if you feel behind is one, you could work for a few more years than you originally planned.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
Two, you can spend less and invest more in your retirement accounts. The third option would be to change what retirement looks like for you. So maybe it's a hybrid of retirement and picking up side jobs. And then the fourth one may be to employ some combination of all of these options. So when I say that, what stands out to you, Amy, for maybe an option that you could explore?
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
Yes. But I do have some like, I don't know if this is good news or not. There are different types of fire, right? So while you may have to be stringent for like Sean said, the more pure type of fire, there is also barista fire for those who are listening who may be like, oh, I want to retire early.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
And that's essentially when you save enough to work part time, but no longer need to depend on full time work. And based on what you told me about you and your husband loving your jobs, which is awesome, and being happy to do it, you know, for as long as you need to do it, there is also the option of working part time.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
And the goal there is to have enough so that you don't have to work full time, but you'd still work part time. So that's a form of fire as well. What is it called again? Barista fire. Barista fire. I like that. Uh-huh. There are different types.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
It might be. Yeah. And the cheeky plug for the listeners who are like, what other types of fire are there? We have an article on nerdwhite.com about the different types of fires. So we will put that in the show notes.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
And here is our brief disclaimer that you love to hear. We are not financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances. This episode was produced by Sean and Tess Vigelin. Hilary Georgie helped with editing. Megan Marr mixed our audio.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
And a big thank you to NerdWallet's editors for all their help.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
So many tariffs and it feels so hard to keep up with. So are there more tariffs on the way? It's very likely.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
I do. And I also know we're sick of talking about eggs, but I can't live without them. And I'm also sick of the prices going up. Olive oil, too. I use that to make my eggs.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
Thanks, Sean. Up next, we answer a listener's question about catching up on retirement savings. But before we get into that, a reminder, listener, to send us your money questions. So take a second and think, where do you need help with your money? Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD. Or email us at podcast at nerdwallet.com.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
Now let's get to this episode's money question. That's coming up in a moment. Stay with us.
NerdWallet's Smart Money Podcast
What to do When Groceries Cost More and Retirement Feels Out of Reach
Amy, welcome to Smart Money. Hi, thank you all so much.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
And I'm Elizabeth Ayola.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
Sean, I don't know if you remember the show we did last week.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
Yes, that one. The one where we joked at the top of the show about how there wasn't much news going on out there.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
And here we are a week later and the barrage of news out of the Trump administration continues unabated. Honestly, it's hard to keep track, but that's our job.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
Let's get up to speed here. On January 31st, the head of the CFPB, Rohit Chopra, was fired and Scott Bessant, who is the new Treasury Secretary, was named the acting director. Now, soon after that, Bessant ordered that the Bureau cease all investigations and said no new rules or guidance would be issued. And it only went downhill from there.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
So at this point, it looks like the agency is effectively dead in the water, which leaves a lot of unanswered questions like, what does this mean for consumers moving forward? To get a better idea of what happens now, Ana spoke with Chuck Bell. He's the program director for advocacy at Consumer Reports.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
I sure did move for the thousandth time. And easy is not an adjective I would use to describe the process, Sean. It was also probably the most expensive thing I've done in my adult life. So it was so expensive that Little Miss Nomad, yes, that's me, has no intentions of moving anytime soon, which is crazy coming from me.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
Yes, thank you. Up next, we answer a listener's question about preparing financially for a big move to a new city and a new job. But before we get into that, a reminder, listener, to send us your money questions, especially your questions about tax season 2025. We're working on an episode all about taxes and we're going to take on some of your burning tax questions.
NerdWallet's Smart Money Podcast
Cross-Country Moving Tips and What a CFPB Shutdown Could Mean for You
Now let's get to this episode's money question. That's coming up in a moment. Stay with us.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
But it does seem like Chris wants to change their habits and use their money to live their life. How do you, Amanda, think Chris can begin to rethink how they're using their money?
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
Chris has this pent-up desire to just live their life and use their money to do so, but is afraid, maybe because they don't know exactly what they would like to do with their life or their money. So defining their personal goals would be an important step for them to take. Because, as we often say on Smart Money, your money is just a tool to get you what you want in life.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
So Amanda, how do you think Chris can begin to map out their financial goals?
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
I love that suggestion, Sean. At 23, I just finished my postgraduate degree. I had moved back to Nigeria for a second time and was also pursuing a media career like you. So I knew little about money management and was just looking at how to survive on what felt like an impossible income at the time.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
One thing I will say, though, is that I knew what life I wanted to live, but I just wasn't clear about how big of a role finances would play and also how to even create a financial plan. If I'm being completely honest, I just thought one day I would earn enough money and everything would just work itself out. Optimistic, but definitely not a plan.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
But that said, I wouldn't trade the life experience that I gained from moving to a developing country alone. Having financial stability is important, but those life experiences honestly shaped me.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
Speaking of investing, I actually was going to say my biggest mistake was not investing. As I listened to you talk, Amanda, I had a different thought. And it would be because I was thinking I just was so broke. I didn't have enough money to invest because I was earning in Nigeria like the equivalent of $200 a month. And I didn't have any other income but that.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
In my 20s, I spent a lot of time thinking that I didn't deserve to earn a good amount of money. So I never really negotiated my salaries. And I also didn't look for jobs that would pay me a reasonable living.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
I don't know if that's a mistake or learning, but I definitely would have valued myself more, asked for more money, and done a lot more research into how I could pursue my passions and still make some money while I'm doing it. And then, of course, I would have invested more.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
By the way, if you want to play around with the investment calculator that Sean mentioned, you can find a link to it in the description of today's episode. Now, speaking of investments, Chris also asked about finding a balance between their rigorous investing and and saving and having life experiences, do you think they should maybe pull back from saving and investing so much?
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
From my point of view, I think the lifestyle they hope to live during retirement is a big piece to answering that question. $1.5 million may be enough for one person, while someone else's lifestyle may require $3 million, for instance.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
Me too. I'm considering an art class sometime soon. Yes. All right. Any other thoughts you want to leave our listeners with, Amanda? Do you have any more gems for us? Well, check your credit score always and always.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
And here's our brief disclaimer. We are not your financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances. This episode was produced by Tess Vigeland. Hilary Georgie helped with editing. Nick Karasimi mixed our audio. And a big thank you to NerdWallet's editors for all their help.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
And I'm Elizabeth Iola.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
Unless you've been living in the desert for the last few weeks, you know we are in a new era of tariffs. President Trump has called tariff, quote, the most beautiful word in the dictionary. And he's followed through with one of the most significant trade wars in modern history.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
But it's our new reality, Sean. And they have the potential to affect just about everything we buy, including, perhaps most expensively, cars.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
Thanks, Sean. Up next, we answer a listener's question about whether it's okay to loosen the strings a bit when you've amassed significant savings and want to move out of your parents' house. But before we get into that, a reminder, listener, to send us your money questions.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
Maybe you're wondering what the recent stock market crashes might mean for your finances and how you can get ahead of a potential recession. Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD or email us at podcast at nerdwallet.com.
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Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
To enter for a chance to win our book giveaway, send an email to podcast at nerdwallet.com with the subject book sweepstakes during the sweepstakes period. Entries must be received by 1159 PM Pacific time on May the 7th. Include the following information, your first and last name, email address, zip code, and your phone number.
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Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
For more information, please visit our official sweepstakes rules page.
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Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
Hey, guess what? Smart Money is a finalist in the 2025 Webby Awards, and you can help us win. Just head to vote.webbyawards.com, register real quick, and vote for us in the best individual podcast episode business category. It's free, it's fast, and unlike borrowing your neighbor's Wi-Fi, totally guilt-free. You've got until April 17th to cast your vote. One more time, that's vote.webbyawards.com.
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Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
To help us answer Chris's question on this episode of the podcast, we are joined by personal finance writer, Amanda Barroso. Amanda, welcome back to Smart Money. Thanks for having me back, you guys. I'm loving this question. We have a really unique situation with our listener here today.
NerdWallet's Smart Money Podcast
Car Prices, Tariffs, and Trade-Offs: What to Know Before You Buy or Move Out
financially, they appear to be doing everything well, and it almost feels like they're doing everything too well. So I know I was a hot mess in my early 20s, but it seems like the listener is hyper-focused on saving and investing at the expense of just living their life, which is pretty much the opposite financial problem that most people have.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
And I'm Elizabeth Aiola.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
I will say a refund and saving money sound like great incentives to me. Let's turn to a couple of questions that we got from listeners about taxes. Here's the first one, which comes from Diana. Hello, I've been trying to max out my Roth IRA, but I'm worried that I will hit the cap on MAGI, so won't continue to be able to put money into it.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
The problem is that although my salary is not close to the limit, my brokerage account dividends are putting me closer to the limit. I don't understand why the dividends get reported on taxes since I haven't ever taken the money out. I also don't understand the difference between ordinary and qualified dividends.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Lastly, I don't understand how it will work later for taking the money out since some of it was included in my taxes now and some was not. I've been just putting money in for the future, but don't know how to actually take it out later. Thanks, Diana.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
I think backdoor Roth IRAs are like a gift because they sound too good to be true, but they're actually true. So thanks for that, Bella.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
All right, so another question we often get from listeners is about whether they should take the standard deduction or itemize. Can you explain to the people the difference and why someone might choose to do one or the other?
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
All right, Sean. So we'd all be forgiven for sticking our heads in the sand this week and not paying any attention to what was happening with our 401ks and IRAs. I mean, honestly, it was a hot mess.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Ha ha. I'm not answering that. Ask me again next week.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Good job, Sean. We're learning from you.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
This episode was produced by Sean and Tess Vigeland. Hilary Georgie helped with editing. Megan Morrow mixed our audio. And a big thank you to NerdWallet's editors for all of their help. And here's our brief disclaimer. We are not financial or investment advisors.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
I'm not sure about y'all, but I definitely like to hear about some ways to cope with the news so we don't become our own worst enemies.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Sean, I hope you did not look at your retirement funds this week.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Up next, we answer a listener's question about taxes as we barrel towards April 15th. But before we get into that, a reminder, listener, to send us your money questions. Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD. Or you can email us at podcast at nerdwallet.com.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Now let's get to this episode's money question that's coming up in a moment. Stay with us.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
And to help us answer all the tax questions on this episode of the podcast, we are joined by NerdWallet tax writer, Bella Avila. Welcome back to Smart Money, Bella. Thanks. I'm happy to be back on.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
That's for sure. And I've been doing the same. So let's hear a bit about what's going on over on Wall Street and some tips for making smart investment decisions.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
So what advice do you have for the procrastinators out there who might not make that April 15th deadline?
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
I love that you added that people have to still pay their taxes because I will not lie, I might have forgotten that part. And also good suggestion on the calculator, Bella. I'm a calculator girl. So for everyone listening, we will have a link to NerdWallet's federal income tax calculator in today's show notes.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Or you can just search in Google or whatever search engine you use, NerdWallet tax calculator.
NerdWallet's Smart Money Podcast
How Tariffs Could Impact Your Retirement and What to Know for 2025 Taxes
Alright, so are there any big changes this year that people should be aware of?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
Confession time. How much debt are you carrying right now? If you don't want to share the details, can you at least confirm it's not trillions of dollars? Well, the U.S. government cannot say that. It's currently more than $36.2 trillion in the hole. And today, we're going to hear how that happened, how serious it is, and what it means to our personal finances.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
And when might it make sense to choose one retirement account over another based on the investments available?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
And here's our brief disclaimer. We are not your financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it might not apply to your specific circumstances. This episode was produced by Tess Vigeland. Hillary Georgie helped with editing. Nick Karasimi mixed our audio. And a big thank you to NerdWallet's editors for all their help.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
That is not where you want to be. So how did the debt get to $36.2 trillion, Anna?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
So who owns the debt and what is the debt made of?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
Welcome to NerdWallet's Smart Money Podcast, where you send us your money questions and we answer them with the help of our genius nerds. Sean will join us in the later half of this episode where we're answering a listener's question about investing in their 401k accounts and whether it's cool that an insurance company is in charge of managing it.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
Can you explain more about the difference between the two?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
You just mentioned foreign countries. So which ones does the U.S.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
I think it's safe to assume that the national debt will grow, but what do economists' projections show?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
Ana, does the government ever pay off its debt?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
But first, our weekly money news roundup where we break down the latest in the world of finance to help you be smarter with your money. Our news colleague, Anna Helhofsky, is here to talk about the large financial hole the country is in and what it means for all of us. Hey, Anna. Hey, Elizabeth. We're going to be answering two listener questions today.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
Well, I've seen the debt ceiling back into the news lately. Can you explain how it's different from the national debt?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
I'm pretty sure we will. Thanks, Anna. You got it, Elizabeth. Up next, Sean is back to help answer a listener's question about whether it's worth contributing to a 401k without an employer match and without a lot of investment options, or if it's better to do a brokerage account on their own. But before we get into that, a reminder, listener, to send us your money questions.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD. Or email us at podcast at nerdwallet.com. This episode's money question is coming up in a moment. Stay with us.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
To help us answer Vicky's question on this episode of the podcast, we are joined by investing nerd, June Shem. Welcome back to Smart Money, June. Thanks so much for having me again.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
And this first one is asking for a bit of an explainer. They wrote, Hi, nerds. Could you attempt to explain how we got into trillions of dollars of national debt? When was the last time we were in a surplus? Who exactly are we in debt to? Thanks. So, Ana, where do we even begin with this subject? It's really hard to wrap my brain around that figure I mentioned earlier, $36.2 trillion.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
Vicky says that the insurance company can change the fees at any time without notifying the people who are actually in the plan. And to me, that doesn't sound right. What do you think is going on there? Because it's my understanding that retirement plans have specific disclosure requirements.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
But can you think of any drawbacks of investing in a 401k for retirement versus a brokerage account? Yeah, there definitely can be drawbacks.
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
And on the flip side, what might be some of the benefits of investing in a brokerage account over a 401k account?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
How does the government rack up that kind of debt?
NerdWallet's Smart Money Podcast
401(k) vs. Brokerage Account: Which Is Better for Retirement Savings? Plus, the National Debt Explained
So 401k accounts are sometimes critiqued because they may not have as many investment options as something like a self-directed Roth IRA, for instance. But as Sean pointed out, we have over 20 different options in our 401k, which seems like a lot. Is that normal or are we just spoiled at NerdWallet?
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Of the business owners who are making it, shout out to y'all, the average makes under $100,000 a year. Owning a business also doesn't automatically mean that your business is going to be worth millions either.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Now, while it may be true that you're unlikely to become wealthy just by earning income from a 9 to 5, the part that people miss is that if you consistently invest that income in, let's say, stocks, bonds, mutual funds, and low-cost index funds, you can become wealthy in a couple of decades.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I want to say congratulations for having that extra money in your budget because I am also a mother and my son is seven. And when he stopped going to daycare, I could have thrown a party for that. So I'm glad you guys have that extra income. So based on all of your priorities now, which one of the ones that you mentioned would you save
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
best aligns with one, your long-term financial goals and also what feels the most pressing?
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
And if you don't mind me asking, how much do you guys have in your emergency savings at the moment?
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Pressure. Most people who become millionaires in the U.S. do so by contributing to a retirement account consistently over time. I also am going to say an analysis by 401k provider Fidelity Investments found that in Q3 of 2024, 544,000 of the 24 million participant accounts in the 401k plans had balances over a million dollars. Case in point, you can become a millionaire working a nine to five.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I like that you said you feel like you're on track for your retirement savings. So what makes you feel like you're on track? What are your goals? And how are you kind of measuring your progress?
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I guess to answer your question about what you should prioritize, obviously only you guys know that, but I will say that some general options in terms of financial priorities that we usually share at NerdWallet is first of all, like Sean said, ensuring that you have a sufficient emergency fund. Then it would be paying down high interest debt, which it doesn't sound like you guys have much of.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
The next thing would be saving for retirement and you're already doing that and you seem to be on track. And then you could consider putting money into college funds first. for your kids, which you guys said was one of your priorities too. You can try to achieve multiple financial goals at the same time.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I think sometimes people get hung up on having to do one thing at a time, which is fine if that's what you want to do. But it is possible to allocate some of that extra income that you now have to saving for retirement and also allocate some to a college fund for your kids and also save some towards your house renovation. So it doesn't have to be one or the other.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Well, I'm going to jump in here because I love talking about FIRE, but I know that's not the exact topic, but it makes me think of Coast FIRE. For anyone who's not familiar with FIRE, it's, you know, financial independence, retire early. But essentially with Coast FIRE, you save aggressively and then you do get to a point where your investments can grow enough to cover your retirement needs.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
And it allows you to, like the word says, coast to retirement without having to save so aggressively. So to answer your question, it doesn't mean that you necessarily stop saving, but maybe you don't have to front load as much as you are. And for a little personal anecdote, I can relate with you guys because I started saving for retirement late and I was obsessing over not having enough as well.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
As someone who is a small business owner and a 9 to 5-er, I want to say that there are benefits of doing both simultaneously. If you want to increase your cash flow, you can save and invest more money by doing both. And I was able to hit some of my savings goals quicker as a late bloomer to investing because I had extra cash to max out my 401ks and contribute to a SEP IRA.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
So I was working, taking on all these side hustles in order to put as much as I could into retirement savings. But at a point, I started forgetting that because my number, I don't know, was around like, oh, I need $2 million or something to retire how I would like to. And I started to think, oh, my God, I need to save $2 million. But I forgot that compound interest is working for me.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
So after some time, that's going to kick in and it's going to help my money to grow. So all that to say, I think, as Sean said, maybe sitting down with a CFP and having maybe a more clear number of where you're trying to go within the different scenarios can help. And just also letting the stock market do what it does and hopefully let your money grow over time can be really helpful.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
So and then also maybe exploring some of the anxiety that you're having around the uncertainty, because I realized that was a big issue for me as well. Four, in some ways, was maybe not so much about the amount of money I had, but more about the fears I had about not having enough money that was driving me to over-worry about it.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
But so important, so important. I used to be so afraid of retirement. And even I took me so long to start saving because I was scared to do that daydreaming because I thought it was going to make me realize how far behind I was. But it actually was such a motivator because I got to think about what I want my life post-retirement to look like.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
So I would totally say even you guys doing that together on one of your dates where you have like your goal sharing or talking about money to just sit down and allow yourself to daydream.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
And even doing that maybe before a meeting could help you bring more to the meeting with the financial planner about what exactly you want that retirement to look like so they can help you with the numbers element of things as well.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I do. Thank you so much for being so gracious, Sean. Okay, okay, okay. But before I bow out, I am going to add that owning a business is not for everyone. So sometimes it's better to take that time and those resources and pour them into lobbying for a raise or developing high demand skills and making yourself more valuable in the job market.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
And here's our brief disclaimer. We are not financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances. This episode was produced by Tess Vigeland. Hilary Georgie helped with editing. Nick Karasimi mixed our audio. And a big thank you to NerdWallet's editors for all the help.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
That extra money you make can be put into smart investments that help you grow your wealth without having to become a boss.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Oh, thank you for letting me, even though it felt like I was talking on fast forward. Thank you.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
All right, Sean, it's your turn. I hope you take a deep breath because you have 100 seconds. All right?
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
And three, two, one, go.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
50 seconds.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
And I'm Elizabeth Ayola. This episode, we talk with a married couple about how they manage their finances together. even when they don't agree on what they want to do with their money.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
But because I'm going to give you, I want you to finish, so go ahead. Tell us.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Okay.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Yes, but it was all good. So I love this argument, Sean.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
As a balanced human and one who has both a Roth 401k and a Roth IRA, I have to agree, kind of. So I do agree that the Roth IRA limit isn't alluring enough for the rich auntie lifestyle that I hope to live during retirement and that the higher Roth 401k limit is more incentivizing.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
But that said, I feel like you're overlooking a huge part of the argument, which is that Roth 401ks can be limited when it comes to your investment options. So with a Roth 401k, you're at the mercy of plan administrators when it comes to your investment options. And that might comprise mutual funds, typically a target date fund, and they usually have set expense ratios.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
However, with a Roth IRA, you can shop around and that can save you money long term and take your retirement savings further.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I will take that rebuttal. But let's not forget that everyone doesn't have access to a 401k. So for those who don't, a Roth IRA may be as close to tax-free withdrawals that they'll get, even if it is overrated, Sean.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
It might be. And because I just have to get the last word in, I'm also going to say, as an aspiring FIRE participant, Roth IRAs can be superior for people who retire early and want to take penalty-free money out of their account to live their best lives.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Fine, you win.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
We're about to get into this episode's money question segment, where we hear from a married couple about how they manage their money together and work through tough money conversations.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Maybe you're having a hard time keeping track of your money and are wondering which budgeting method might be right for you. Or you just got hit with a big car repair bill and are wondering if putting it on the credit card is such a bad idea. Whatever your money question, we nerds are here to help. Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I think that's my default, Sean. As a recovering oversharer, I am well-versed in realness.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
Alrighty, let's get to this episode's money question segment. That's coming up next, but you got to stay with us. We're back and we are answering your money questions to help you make smarter financial decisions, hopefully. In this episode, we're joined by Naomi and her husband, Andrew, who have some questions for us about how to prioritize the new breathing room they have in their budget.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I love that you guys are on the same page because as Sean said, that can be difficult for some couples. So are there any areas where you maybe disagree or you don't necessarily align when it comes to how to spend money? I know you mentioned short-term goals. So maybe can you expand on that a bit more?
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I stay ready, Sean.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
So owning a business isn't the only way to build wealth. It grates my nerves when I see social media influencers or business owners tout this idea. I mean, that isn't the only way to become a millionaire. All right. So first of all, about one in four businesses fail within the first year. And I'm not saying this to be a negative, Nicole, or discourage people from starting a business.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
I love that. I want to circle back to this idea of you guys maybe disagreeing a bit around your short-term goals, and especially because you mentioned debt being maybe the main driver for that. And you also mentioned a very good point, which is sometimes there is what is called in the financial world, good debt and bad debt. So what are you guys' ideas of what good and bad debt are?
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
So if we can see if we can get you to reframe and maybe align in that regard.
NerdWallet's Smart Money Podcast
How to Build Wealth Right Now and How Couples Can Align on Financial Goals
So Sean, do you want to maybe first go into what good debt and bad debt is, especially within their context?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Sean, you're a homeowner. When you bought your house, how did you make sure you got the best deal on your mortgage?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Kate, where does the idea of a 20% down payment even come from? And I imagine that sounds intimidating to me, especially with home prices these days. That might be tough to do in this economy for some people. It is tough to do because 20% of a home price is
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
That's a fair point, Kate, considering how costly home maintenance can be. That leads me back to the listener's question around budgeting for a home. How can people determine how much house they can afford? Well, an affordability calculator is a great step.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Now, listeners, I have used that calculator and I must say it was pretty handy. So once people have used the calculator and have the numbers in front of them, how can they decide whether to make a larger or smaller payment if they're on the fence?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
So Kate, aside from a down payment, aren't there other costs first-time homebuyers need to budget for? Oh my goodness, there certainly are.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
So that definitely sounds like a lot more than just a down payment for sure. And I'm so glad that you mapped that out so that listeners can budget for all those other costs. I also wonder about other expenses that are easy to overlook, like moving, for example. I personally moved last summer, but it definitely was a major cost.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Very, very smart. So Kate, what if the listener checks their budget and they realize they do not have much to put towards saving for a down payment? Now with rising inflation and higher mortgage rates, some people might feel home ownership is just out of reach.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
And let me tell you, I love free money. So that is a good plug. Right. All right. So the listener also wants to know what the upper limit on their monthly post-tax income that they're paying should be. What answers do you have for them?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
So some potential homebuyers, Kate, may have entered 2025 excited about the prospect of buying a house since inflation was, I'm going to highlight was, trending downwards. And we seem to be reaching the light at the end of the tunnel. With things changing a little, should homebuyers be discouraged with current trends we're seeing?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Should they be trying to buy now in case the market potentially gets worse?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Kate said it best, guys. No need to panic buy. So what else should people know about home buying in 2025? This is a crystal ball for everybody.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
I hope this is some sort of silver-ish lining for prospective homebuyers. Before we wrap up, we have a surprise listener question.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Hey, Sean, we've been focusing on how to buy in 2025, but what tips do you have for us on selling, Kate, so we can answer Sean's question?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
That sounds like an ideal situation and a great example of good customer service equating to repeat business. Now, what about commissions if you choose to use an agent?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Well, that's definitely on brand for you, Sean. And I'm glad that you did your due diligence.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
So I once did work with a broker when I was looking at homes, and I found that I spent quite a lot of time communicating with them and spending time with them. So with that said, what are some things that people should look out for when they are choosing a broker?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
And I'm Elizabeth Ayola. On this episode, I talk with mortgage nerd, Kate Wood, to answer a listener's question about how much house they can afford as a first-time buyer.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
I also wanted to know about the actual broker. So what qualities and characteristics should I be looking for when I'm choosing a broker to work with?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
That's helpful.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
And when someone is presented with the loan options from a broker, how can they ensure that the loans they're seeing are the best ones out there? Because a broker may not show you loan options from every lender available, right?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
So I think a lot of folks might not fully understand the role of a mortgage broker. Can you explain what a broker does and also how they fit into the home buying process as a whole?
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
I certainly feel more empowered as someone who is not a homeowner yet. And I'm sure a lot of the listeners do as well. With that said, for listeners who want to learn more about finding a mortgage broker, we're going to link to an article all about that in the show notes.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
All righty. We're about to do a timely pivot to a listener's question on how to budget for home and mortgages. Writer Kate Wood is going to help us answer that.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Maybe you're feeling a little lost, like you don't even know what your financial goals should be, or you're trying to break yourself out of a bad financial habit, but just can't seem to do it. Whatever your money question, we nerds are here to help. Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Let's get to this episode's money question segment where we take on one of your questions about how to budget for a down payment on a house and a mortgage payment. That's up next. Stay with us. We're back and we are answering your money questions to help you make smarter financial decisions. This episode's question comes from a listener's email and is about home buying. Here it is.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
Hi, NerdWallet team. First time home buyer here. How do we best budget for a down payment and mortgage? And what should be the upper limit on our monthly post-tax income that we are paying? Now, to help us answer this listener's question on this episode of the podcast, we are joined by NerdWallet Mortgage's writer, Kate Wood. Welcome back to Smart Money, Kate. Thank you so much for having me.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
All right. So the listener has a two-part question. Let's tackle the first half to begin with. They want to know how best to budget for a down payment. Now, I'd be curious to hear what your thoughts are, Kate, especially with how much the housing market has changed over the past few years. Sure.
NerdWallet's Smart Money Podcast
From Broker to Budget: How to Buy or Sell a Home in 2025
When you mention a larger down payment, it takes me back to the pandemic times when I was considering purchasing a property and it was a seller's market. I remember larger down payments being a theme and a tip shared by realtors that I work with at the time. Would you recommend people aim to save 20% down payments?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
And I'm Elizabeth Iola. On this episode, we answer a listener's question about what kind of returns they can expect from their investments.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
But before we get into that, we're at that special part of the show, the moment where we ask you to take a minute and think about where you need some nerdy guidance with your money.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
And a reminder that one of our goals on Smart Money this year is to talk with more of you live on the podcast to help you with your money questions. Yes, we want to hear your voice. So if you want to hang with Sean and me for a bit and get some nerdy wisdom, let us know. One more time, leave us a voicemail or text us on the nerd hotline at 901-730-6373. That's 901-730-NERD.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
We are back and we're answering your money questions to help you make smarter financial decisions. This episode's question comes from Mary, who wrote us an email. They wrote, Hi, I have a question about investing. About six years ago, I made my first attempt at the stock market without fully understanding what I was doing and definitely without the benefit of your podcast.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
At the time, I opened two accounts with Wells Fargo, a Welsh trade account and a Welsh trade IRA. Currently, I have about $6,000 in the IRA, which is separate from my work 401k, and around $3,000 in the Welsh trade account. I honestly have no idea what's going on with my Welsh trade account since I initially invested.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
It's in a mutual fund, and the $1,000 I contributed back in 2018 has only grown to about $2,000. Is that a decent return? And if not, is there a way to move these funds into a better account or investment strategy? Thanks again, Mary.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
So let's first talk about what kind of growth is realistic to expect from an investment. Now, in general, what kinds of expectations can or should people have about their investments, Sam?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
I'm so excited to be in the co-hosting seat and listeners. My hope is that you aren't throwing virtual tomatoes at me. I plan to give it my best. I love talking about money and it's an honor to help people navigate their financial decisions.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
So Mary also said that they're invested in a mutual fund. We don't know what kind of mutual fund they're invested in though. For folks who might be even wondering like, what is a mutual fund? Can you give us a super quick explanation and then tell us maybe what kinds of returns people can expect from a mutual fund?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
I love what you said, Sam, about not liking individual stock picking because I definitely fall into that bucket.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
It is. It is. And it can create like a lot of anxiousness if you feel like you don't know what you're doing. All right. So our listener also seems interested in generating even greater returns from their investments. So how would they go about doing that? Mary said more specifically that they might need to move the funds to a new account, but that probably wouldn't be necessary, right? Yeah.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
I had a quick question as well, Sam, if you can answer this. I know you mentioned selling a mutual fund and then putting the money into a more aggressive one. Would there be tax implications for that?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
For anyone out there who's wondering what the heck we're on about, our new logo is neon green in case you're looking for us inside of your podcast app. And while you're there, don't forget to leave a review.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
That makes sense. So Sam, tell us, do you have any other thoughts about how investors should consider what makes up a good or quote unquote good return on their investments and also how they can set realistic expectations for themselves?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
And here's our brief disclaimer. We are not financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
Thank you, Johannes. I appreciate that.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
So this kind of behavioral bias can be seen across the range of interactions that people have with money. But some of the ones that cost us the most pop up in investing, since we're on the topic of investing. So what kinds of behaviors of these sorts do you see investors fall into, Johans?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
I guess I have a question around how people can do that. So what does it look like in practical terms? I guess, like we say, explain it to a five-year-old to look at the big picture, especially for new investors who are maybe not well-versed in that.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
So how much do you think a knowledge of how the stock market works plays into these biases? So I know for me, because I factually know, like you said, the rate of return or average rate of return on the stock market is 10%. I don't worry too much about that.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
So do you think it's a lack of understanding of how the stock market works that kind of drives that fear and maybe elucidates the biases as well?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
Whether it's keeping your impulse spending in check or sticking to your investment strategy, it's all too easy to get in your own way and do things that aren't in your best interest.
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
I'm also curious about what role money fears play in this type of behavioral bias also. So for example, is someone with money fears or even financial trauma, let's say around losing all of their money, more prone to impulses that come with the bias?
NerdWallet's Smart Money Podcast
Behavioral Finance Mistakes That Hurt Your Portfolio and What “Good” Returns Look Like
So I know that you're a finance pro, but I have to ask you, Johans, have you ever found yourself engaging in either recency bias or some other element of behavioral finance where you said to yourself, wait, this is my brain reacting in a way that may not benefit me in the long run. And if you did, how did you react to that realization?
NerdWallet's Smart Money Podcast
Welcome to NerdWallet's Smart Money Podcast
And I'm Elizabeth Ayola. We're the hosts of NerdWallet's Smart Money Podcast, where you bring the money questions and we bring trustworthy information back by NerdWallet's expert analysis, without the jargon or the sales pitch.
NerdWallet's Smart Money Podcast
Welcome to NerdWallet's Smart Money Podcast
Plus, we keep it real. No lectures, no judgment. Just tips and tools you can use to build wealth and take control of your finances. Think of us as your financial GPS, helping you navigate your money decisions and avoid expensive wrong turns.
NerdWallet's Smart Money Podcast
Welcome to NerdWallet's Smart Money Podcast
So if you want practical, straightforward, and actually useful financial knowledge, plus a little bit of fun along the way, follow NerdWallet's Smart Money Podcast on your favorite podcast app.
NerdWallet's Smart Money Podcast
Welcome to NerdWallet's Smart Money Podcast
That could work. No shame in pillow fort game. Or you could just tune in for clear, research-backed financial insights.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
Jeremy, welcome to Smart Money.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
So how do you manage your money on a regular basis? Do you have a budget? Do you contribute to savings accounts?
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
Well, this feels like a good segue into retirement savings since you're talking about 401k and the like. So let's talk about your retirement savings. How much do you have saved and also how much are you saving at the moment?
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
That's really interesting. And it leads me to a next question, because I know when I first started saving for retirement, I didn't actually have a goal in mind. I just was thinking, you know, let me max out everything I can and save as much as I can. But it really helped me to put things into perspective when I realized I should probably have a number that I'm saving towards.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
So with that said, have you used a retirement calculator to get an estimate of how much you may need to save for retirement?
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
All right, so something that piqued my interest in terms of a question you asked us was that at what point do you take advantage of your time over the pursuit of more income? So can you tell us a bit about that?
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
This was the story of my life last year and the year prior. I was also juggling multiple gigs because I wanted to get ahead financially. I am someone who, you know, believes a bit in the fire movement. So I was looking at early retirement, still am. Saying I was burnt out was an understatement.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
I will say using a calculator, as Sean mentioned, to see how far I was from my retirement goal, both if I continued working and saving at the same pace I was. And also looking at it, if I had dropped a few gigs, helped me tremendously. For one, it helped me to remember that compound interest will begin to fast track my growth in a few years.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
I started late, so I am a late starter when it comes to retirement saving. And also the calculator helped me to see that I'm doing pretty good, just as we've given you a pat on the back for doing earlier. And then the last thing I'll say is that reassessing my money values helped me too.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
So in the end, I did choose to drop a few gigs because while money is important, enjoying my time is equally important. And I was putting too much pressure on myself. Money was starting to cause me more stress than it was creating ease in my life.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
And then I don't know how much this will resonate, but something else that comes to mind is I know we can get hung up on, it is important, retirement savings as a long-term goal, but there are also short and medium financial goals that you can work towards. And they don't all have to be retirement focused. So I know you mentioned buying a second house.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
For some people, it may be as simple as going on a vacation or buying a new car. So it's important to remember that money is here to create security, but also to bring joy in your life as well.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
Thank you for sharing that.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
The first thing I will say, I know this can be a frustrating response, but it really, really does depend on your goals. There are several accounts that you can use in place of a 401k. An IRA is a good account that you could consider. A taxable brokerage account is also one that you can consider and probably the easiest one to go with.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
You would just shop around a bit, find the right one for you, and then make regular contributions to that account. There's also a solo 401k if you happen to be self-employed that you could contribute to as well. So yeah, there are different options aside from 401ks. I think the main thing to consider are fees.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
So you just obviously want to contribute to the account that has the lowest fees and that's going to get you closest to your long-term goals.
NerdWallet's Smart Money Podcast
Why Traditional Budgeting Fails and What’s Missing from Your Money Plan
And here's our brief disclaimer. We are not financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
So let's get into the tax part. How are the taxes that people owe on a Roth conversion calculated? And more specifically speaking to our listeners question, are there any good resources we can point them to so they can figure out what they might owe if they do do a conversion?
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Now let's get onto our second listener question and it gets more even into the weeds around Roth conversion. So here it is. Hello, my name is Ryan. I have a question about backdoor Roth IRAs. I understand the general concept.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
However, my coworker brought up the pro rata rule, which I think states that any other traditional IRA money is eligible for taxation, even if the account you use to roll over is separate. His accountant advised him against it. My accountant didn't seem to think this was the case. Backdoor Roth.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Now the name sounds a little sketchy, but they are legal and they can be a really useful tool for tax-advantaged retirement savings. So Sam, can you describe how this unsketchy Backdoor Roth works?
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
And I'm Elizabeth Ayola. This episode, we answer a listener's question about Roth conversions, which is timely considering tax season is upon us.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Well, that definitely falls under the complicated category. So, Sean, do you have any thoughts about how people can avoid this pro-rata mess and also avoid a run-in with Uncle Sam?
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Yes, I love a Roth 401k. As sexy as they come. All right, Sam, any other thoughts about Roth conversions and how people can make use of them?
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
So for context that nobody asked for, I recently wrote an article on the topic of AI for nerdwallet.com. And what I learned along the way was pretty interesting. So I came across an Experian report that found that 67% of the Gen Z population and also 62% of millennials surveyed are using artificial intelligence to help with their personal finances.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
And here's our brief disclaimer. We are not financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances. This episode was produced by Tess Vigeland. Hilary Georgie helped with editing. Megan Mao mixed our audio. And a big thank you to NerdWallet's editors for all of their help.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
You're absolutely right, Sean. And that was my first conundrum when I started researching. So I would say that when I personally hear AI, my mind immediately jumps to chat GPT, right? But the Experian report that I just mentioned focused on generative AI. So for those who are like, what the heck is that?
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
It's defined as an algorithm or learning model that can be used to generate new content based on the data it's trained with. So the most common example is a tool like chat GPT. In the experience survey that I mentioned, the target was people using generative AI tools for things like budgeting and saving, investment planning, or improving their credit scores.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Anywho, other than generative AI-powered tools, there are so many other AI tools available that can help people to manage their finances. Some ways that people could use AI, generative or otherwise, to help manage their money include via an AI-powered budgeting app, robo-advisors, and yes, chat GPT or other chatbots.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
There are also AI power tools that can be used for bookkeeping and researching and analyzing stocks, which can be a headache for some people. Some of these tools just use elements of AI while others brand themselves as actual AI tools. And it kind of reminds me of greenwashing a little bit. Not everything that has a green label on it is 100% sustainable.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Exactly, Sean. So I think it's pretty cool and it could remove barriers for some people who struggle to manage their finances because it all seems so complex. And it can also be a way for people to elevate their finances too if they're stuck at the basics.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
I think at a high level, AI tools can be used to assist with budgeting, one, understanding complex financial topics, two, and three, researching companies for investing.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Well, Sean, first of all, don't let me find out that you are an undercover AI expert. Are you? Are you?
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Okay, good. But yes, you are correct. So you could also tell an AI bot what your goals are and ask how you can get there based on your income and expenses. So if you're not into the AI bot life, there are also AI budgeting apps like Clio, for example, that can provide a budget plan, send payment reminders, and also track your spending.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
For sure. I will say though, it's important to remember that AI isn't always great for personalization. So it doesn't take things like your money values, your fears, your triggers, and things like that into account. And these things are just as important as the quantitative aspects of budgeting. So for example, maybe I have a money fear around unexpected emergencies.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
So I would want a bigger emergency fund than the AI tool suggests. So Sean, this is a good place for you to plug your CFP knowledge around behavior and finance.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
I'm hoping it's not going to put us out of a job, Sean. But I don't know about you, but when I first started my financial education journey, I found many topics around finance confusing. For example, like how bonds work or how to analyze a stock, as I mentioned earlier. And it kept me from starting my investing journey for a while.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
So there are some AI tools out there that can help you better understand complicated financial topics and also overcome some of these roadblocks. The thing I personally like about chatbots, like ChatGBT in particular, is you can use them like a thought partner and have a conversation with them.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
So you could ask it to break a complex topic down for you based on your learning style, and you can keep on asking follow-up questions until you understand. And if you think about it, if someone is explaining to you a topic and you don't understand, sometimes you get a bit apprehensive about keep asking, right? But with the chatbot, there's no judgment.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
So I think that's the difference between using a tool like AI for financial education and just reading an article. AI is more interactive.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
I see the sneaky plug that you just put in there, Sean. And I like it.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
I love it. And I agree with you on that.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
I think this is a huge one for investors, whether they're at the beginner, intermediate, or advanced stages of investing. So as I mentioned earlier, Sean, a barrier to getting started or even leveling up your finances can be a lack of understanding of how to pick stocks, analyze markets, or just research companies. Some AI tools out there can do a lot of this work for you and that saves you time.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
For instance, AI can help you sort through stock market data to identify worthwhile investment opportunities. And similarly, it could help you sort through historical data to help you identify potential risks so you can then make an informed decision based on that knowledge. For the most part, it can be a good resource for research around an investing strategy.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
I second that. And I will also throw out there, because there may be some people who are like, well, aren't robo-advisors AI? So there is an exception, I suppose, which is using a robo-advisor. They use AI to help automate the investment process and also provide general advice.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
But the personalized advice you need to increase your chances of achieving your financial goals may be lacking with robo-advisors. So with that in mind, if you want to learn more about robo-advisors, another plug, we've got an article about that we can link in the show notes.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Well, I can't give you investment advice, Sean, but that is exactly what I'm saying. So listeners do not ditch professionals like Sean who can give your finances some personal razzle dazzle. I remember when I first hopped on the scene, I think people were spooked about it taking over. But now we're seeing more and more that we can be thought partners with artificial intelligence.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Just add it to whatever else you already have going on if you think it's going to be helpful. We also have an ongoing global issue to tackle that AI might help with trying to figure out what's for dinner and making sure these expensive eggs are not on the ingredient list.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
All right, enough about AI. Time to transition into our money question for today. And that is about, dum-dum, Roth conversions.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Maybe you're feeling a little lost, like you don't even know what your financial goals should be. Or maybe you're trying to break yourself out of a bad financial habit, but just can't seem to do it. Whatever your money question, we nerds are here to help. Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Well, I use ChatGPT to find Valentine's Day staycation ideas. And I am proud to say that I now have new date night ideas that I will be taking full credit for. Just kidding, kinda. But honestly, I also use it to explain how bonds work like I was a five-year-old. And then I asked it to further explain to me as a visual learner.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Let's get to this episode's money question segment where we answer a listener's question about Roth conversions. That's up next. Stay with us.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
Good to have you back. So let's get to the first listener's question, which comes from David, who sent us an email. Here it is. I have a question about IRA to Roth IRA conversions. I have four times in my IRA what I have in my Roth IRA, mostly because my IRA is old 401k rollovers.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
I can't find anywhere a calculator to estimate taxes that I will have to pay or anyone talking about how much to do a year.
NerdWallet's Smart Money Podcast
Can AI Really Manage Your Money? Plus: The Truth About Roth Conversions
As Sean said, Roth conversions are the main character right now. Can you talk about why they're so appealing and whether they're right for everyone?
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
And I'm Elizabeth Ayola.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
But first of all, we're talking about a new NerdWallet survey that tells us how much debt might make you seem like a walking red flag to a potential romantic partner. And we are joined by Sarah Rathner for this conversation. Hey, Sarah.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
Yeah, I like that Sarah Beige flag. I think for me, I would be trying to gauge their money value. So are they in the trenches of their financial trauma? Also, do they have a basic understanding of their financial snapshot, like where their debt fits into that? And also, like you said, Sarah, a goal for getting out of debt. So for me, it would also be about what their expectations are for me.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
Are they expecting me to pay their debt off or contribute to it? I think those are some factors that would matter.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
Absolutely. And because I'm a little empathetic, I think that would be a soft spot for me for sure. But beyond debt, what did this study have to say about how people weigh the financial management of a potential spouse?
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
I am seconding that and I had an ex who had this exact problem and it's one of the reasons he is an ex. So how can people maybe make themselves a little more financially appealing to a partner, Sarah?
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
Yeah, I don't blame them. That's a tough one to work through. Sarah, do you have any other advice for people so that their finances don't get in the way of their love lives?
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
Exactly. I feel like it's always so romantic to me when I hear about couples who maybe started off with, I don't know, $200,000 debt and then they worked as a team and paid it down together. So I think that's a huge part of love too, like working towards goals together.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
With that said, we are about to turn to this episode's money question where Sean and Sarah talk with a listener about how they can plan for their dream retirement.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
And I'm betting a lot of you have received your W-2s or 1099s and other tax documents in the mail. And you're starting to wonder about filing your taxes this year. Hmm, talking to myself. We're working on an episode all about your tax questions, so let us know where you need help. Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
Or you can pop us an email at podcast at nerdwallet.com.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
All right, let's get to this episode's money question segment where we talk to a listener about their retirement goals. That's up next. Stay with us.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
Oh, you must want me to be talking all day, Sean. But I'm proud to say that I'm now well versed in red flags, and they're no longer a carnival for me. So with that said, the last red flag for me was a guy I was dating calling my son a third wheel.
NerdWallet's Smart Money Podcast
Debt in the Dating World and Retirement Planning for Entrepreneurs and Business Owners
And for good measure, I'm going to throw in another one. So I also met a guy who wanted to have more kids. He had six already, but he did not have a plan for more income.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Sean, one of my intrusive 3 a.m. thoughts is whether I've told my beneficiaries where my estate planning documents are. And when I last saw my birth certificates as well. Am I alone in this?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
I expected to see withholdings for the other states as well, given that my employer was aware of my work locations. This makes me question whether I actually need to file in those four other states, especially since I don't have detailed records of income earned in each state due to extensive overtime.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Additionally, North Carolina doesn't appear to have any reciprocal agreements, which would have made my life far easier. Most sources recommend consulting a tax professional, but that isn't financially feasible for me right now, and navigating the task code on my own has been quite challenging. Could you provide any guidance on how to determine my filing obligations?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
And what can people who tend to work in different states throughout the year do to stay on top of their potential tax liabilities? How can they stay organized and get ahead so they're not overwhelmed come tax season?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
So this makes the timely segue into the right way to store your documents.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
It sounds to me like the listener's anxiousness is feeding the procrastination around filing their taxes. First of all, what are the repercussions of not filing your taxes for two years?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
You are correct. I'm referring to those and essentially any document that could impact your financial life. You want to think carefully about how you store legal identification documents, tax documents, financial records, and also estate planning documents. Things like tax returns, investment statements, bank statements, pay stubs,
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Another important point that comes to mind from this listener's question is how important it is to have a tax system that works for you. And that might include having a tax professional on deck, a software you use, or a general accounting system to keep track of your tax situation. It sounds like the listener has played with different options and not found the right system for them.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
How can someone determine the best system for them, Bella?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
card titles, property deeds, insurance policies, and social security cards could fall under those categories. But I know I mentioned a lot.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
And here's our brief disclaimer. We are not financial or investment advisors. This nerdy information is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances. This episode was produced by Tess Vigeland. Hilary Georgie helped with editing. Nick Karusemi edited our audio. And a big thank you to NerdWallet's editors for all their help.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Exactly.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Well, you have a few options here. If you don't want to turn looking for important documents into a scavenger hunt, you can put hard copies of your documents into labeled folders and then house them in a file box, cabinet, drawer, or a wardrobe.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Ideally, you'll keep them in a safe and dry place. I once left my documents in a humid closet, and I bet you can guess what happened to them. Another free tip, if you have young kids, keep the location out of their reach. Some of my important documents have turned into coloring books for my son over the years.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
What a downer, but I'm going to pick it back up. I think it's a good time for us to discuss document management so I can make room for other intrusive 3 a.m. thoughts.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
For people who want an added layer of security, consider a fire-resistant file cabinet or a safe. And another option is a safe deposit box at a local bank. You probably don't want to put documents you'll need frequently in there because, of course, banks are usually closed evenings, holidays, and weekends.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Also, an original copy of a document, like a will, probably shouldn't go in there because if you die, an executor will need the legal right to access the box. But that said, you could leave a copy with a trusted friend or a relative or with an attorney.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Both, because why not? It can be helpful to have a hard and soft copy of financial documents just to cover your back and your front. Now, in terms of storing digital copies, you can take pictures of your documents and store them in a hard drive or an online cloud. You could also pop them in a file on your computer, but there is the risk of that computer getting lost and technology fails sometimes.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
So it's good to also have a hard copy somewhere and inform your loved ones about where that location is. And I'll also add for people who are worried about cyber criminals, there is some identity protection resources that you can use or tools rather in case you're worried about that. So we will link out to that in the show notes.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Correct.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
I know document hoarders, and it creates so much drama sometimes when you're searching for important documents. You first have to get past the pile of irrelevant documents before you can find what you actually need. So having too many financial documents laying around can also put you at risk of identity theft.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
There are. For tax documents like returns, W-2s, 1099s, charitable donation documents, and tuition payment receipts, ideally you keep them for three to seven years. That's because the IRS usually doesn't audit further than six years. Yeah, that means you should probably ditch the tax return from 2018 and earlier.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
But seriously, if the IRS decides they want to be in your business and do an audit, you'll need those returns. Finance professionals say you can keep bank statements and pay stubs for up to a year. Many banks will provide bank statements as far back as seven years in case you dispose of them earlier and you happen to need one.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
In terms of utility bills, you can probably keep them for, let's say, one to three months. When I'm asked to provide a utility bill for something, they usually want a bill no older than three months. And also, you can likely request an e-bill if you need something further back.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
And I'm Elizabeth Ayola. This episode, we're answering more of your questions about taxes ahead of the April 15th filing deadline. But before we sway that way, let's talk about managing important financial documents, which is also relevant when it comes to taxes.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
And lastly, as for medical bills, the Federal Trade Commission suggests keeping your paid and undisputed medical bills for at least a year.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
I have some by my bedside as we speak. Unless you're using them to document business expenses or for something you might get a tax credit on, you can usually shred baby shred. Warranty receipts are the exception. You want to tuck those away safely until the warranty is up. Sean, you're a homeowner. I'm going to let you share your nerdy two cents about property records.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
How long should people be keeping those?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Good hygiene around this is to shred, and then you could also recycle. You don't want your personal information hijacked by a scammer, so ensure you dispose of these documents safely. Based on this episode, what's next for you and your document, Sean? I know organization is important to you.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
We're about to answer a few of your questions about tax season 2025.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Maybe you've fallen off track with your financial goals for the year and need help getting back on track. Or you're faced with a major financial decision and need help weighing out your options. Whatever your money question, we nerds are here to help. Leave us a voicemail or text us on the Nerd Hotline at 901-730-6373. That's 901-730-NERD.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Sean, if I recall correctly, didn't you talk with your dad in that scam series about a scam he experienced?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Let's get to this episode's money question segment. Stay with us. Hey, guess what? Smart Money is a finalist in the 2025 Webby Awards, and you can help us win. Just head to vote.webbyawards.com, register real quick, and vote for us in the best individual podcast episode business category. It's free, it's fast, and unlike borrowing your neighbor's Wi-Fi, totally guilt-free.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
You've got until April 17th to cash your vote. One more time, that's vote.webbyawards.com. We're back and we're answering your money questions to help you make smarter financial decisions. And we're taking on a few of your questions about taxes. We did an episode about a month or so back about what you need to know around tax season 2025.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
And we got so many good questions from y'all since then that we decided to do another round. And I'm sorry to be a bearer of bad news, but the filing deadline is around the corner.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Ha. So, Sean, how do you store your documents? What are you going to do with your tax documents, Sean? Yes, I'm all in your business.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Thanks. I'm glad to be back on. Bella, before we answer the listeners questions, I think we should address an elephant in the room. Some people may be wondering whether they should even bother filing taxes with the new administration's talk of abolishing income taxes in the IRS, rewriting the tax code and relying on a tariff based revenue system.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
All right, Bella, what's the best way to pay for a surprise tax bill? And I definitely have never heard of a no interest payment plan for taxes.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
And this also brings up a broader question about withholding. How can people ensure they're withholding enough taxes as the year goes along? Do you have any tools or resources you can share with listeners?
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
That's right, Bella. That's something I definitely had to do. I know when my pay increased, I had a chat with a financial advisor and she helped me to calculate how much I should withhold. I also played around with a withholding calculator.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
Well, this is a no-shame zone, and that means this episode is for you, Sean. But I will say at least they're not being stored on the kitchen counter and being decorated with food stains. That may or may not be a personal story. So I keep most of my documents inside of a folder tucked away somewhere in my garage and somewhere in my bedroom wardrobe in another folder and somewhere in my email.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
All right, here's another one of your questions about taxes. This one comes from Simon, who sent us a text message. Simon wrote, "...during the 2024 tax year, I worked for a company that required me to travel and work on-site in multiple states.
NerdWallet's Smart Money Podcast
Last-Minute Tax Questions Answered and Tips for Keeping Your Financial Documents Safe
I understand that I may need to file tax returns in each of these states depending on their respective filing thresholds, some based on income and others on time spent working there." However, my W-2 only shows withholdings for North Carolina, end quote, where the company headquarters is located and where I worked when not traveling.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And I'm Elizabeth Iola. On this episode, we talk with a listener who's wondering how to balance paying off their debt while building up their savings.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So you're also just at the beginning of your financial life, Mikayla, which I think is exciting personally. So where do you think you have the most room for growth with your finances?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So Michaela, now can you tell us a little bit about your savings? So what do you have saved at the moment?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
I see what you did there, Sean. You get a gold star for the wordplay.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And I will say as well, Michaela, I empathize with wanting to pay down your debt fast. I absolutely hate having debt. And sometimes it feels like something hanging over your head. But in general, it can be best to build your savings while you're paying down your debt at the same time. And one of the reasons for that is that so you can easily cover an emergency without going deeper into debt.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And I don't know about you, but sometimes when people say that, I'm like, well, how? Because I get maybe sometimes lost in the numbers. And I think there are different ways that you can approach that. So at NerdWallet, we love the 50-30-20 budget. So that's where 50% of your income goes to needs, 30% goes to wants, and 20% goes to debt and savings. For example, out of that 20%, you could...
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
allocate some towards paying down the debt. Since you said you're doing the snowball method, you know, you would focus on the smallest debt first and pay the minimum balance on the rest. And out of that 20%, you could also put some money towards emergency savings as well. So it doesn't have to be either or.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And Michaela, I also wanted to ask, are you getting an employer match at your job? I am, yes. And are you contributing enough to get the match?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Okay, awesome.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
All right, Sean. So tell us, where do you think people should start?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Wow. OK.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Exactly. And I think this is also a good time to unpin your comment earlier about whether it's worth saving for retirement while you have so much debt. So I think a lot of people face that conundrum and they're like, well, it's not worthwhile to do. But I know the average rate of return on the stock market, obviously, ebbs and flows is around 10%.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So depending on, again, the rate of your debt and how much debt you have, it definitely can be worthwhile to simultaneously pay down your debt and save for retirement so that compound interest and time can both work in your favor for your retirement savings. Okay, yeah, that makes a lot of sense.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Okay. All right, Michaela. So let's double back to the budgeting topic. You did say that you are doing a zero base budget. Are you happy with that budget or do you have any doubts or think maybe you should be trying a different one?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Well, first of all, I want to commend you because at 24, I did not have that discipline to do that kind of budget. I think when people think of the word budget, it sounds very limiting and restrictive, but there are so many different types of budgets out there. And luckily, you can choose one based on your personality type and your expenses.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So while the zero-based budget, I think, works for people who do like to track every single dollar and maybe have a better idea of where all their money is going, there are other methods to try. I personally am a pay yourself first type of budgeter.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And essentially what that means is quite self-explanatory is you pay yourself first, you do your savings, you cover your main expenses and the rest goes on whatever it goes on. But that is, I think, ideal for people who are maybe not impulse spenders or have a good handle on their spending. But I will say budgets also don't have to be set in stone. They can change according to where your life is.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So last year, I had a lot of changes in my finances. So I shifted to more of a 50-30-20 budget. So there are different type of budgeting systems. Aside from that, there's also the envelope or cash stuffing method. And that can be good for people who need to rein in their spending as well.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
I like these three tips and I think they're good pillars for people to use, myself included. Now let's break it down and start with personal preparedness, which can come in a lot of different forms. Financially, one area to focus on is cash on hand. So if you are unable to use your credit or your debit card, say because networks are down or the power is out, how would you pay for things?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And also be proud of yourself because you seem to have the foundation and you have clear goals in terms of what you're trying to do. So just give yourself time as well, you know? Yes, thank you.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Thank you. You have. I did not start saving for retirement until I was 32, I think. So you're doing awesome.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
This episode was produced by Sean and Tess Vigland. Hilary Georgie helped with editing. Megan Marle mixed our audio. And a big thank you to NerdWallet's editors for all their help. And here's our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes, and it may not apply to your specific circumstances.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Now, this tip in particular reminds me of my first week in Houston when Hurricane Beryl hit and we experienced a power outage. It was horrible. So I drove around for hours looking for cooked food and didn't have any cash on me. Honestly, it was a nightmare. And the few restaurants that were open only took cash.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So it reminded me to keep cash beyond what my son has in his piggy bank and dollars in the house.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
I love that for you, Sean. So now tell us, is there a guideline for how much cash people should have just in case?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Exactly. And like you said, that number probably looks different for everyone. My son eats a lot of snacks and just eats a lot generally. So I might need more than 500. Another thought, instead of pulling out all of this money at once, you can take a more gradual approach to building up your cash reserve. So maybe each week you pull out $20 and put it in a safe place.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And I also will put my mom has experienced taking out cash and then forgetting where she put it. So maybe also have a clue of where you're putting the cash.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
People can think of this as basically like a physical emergency fund that you're keeping in a secure location in your house, possibly even in a go bag like you have, Sean, that you have filled with stuff that you might need in time of a crisis. But beyond cash, there are other things that folks should have to prepare for some unforeseen emergency too, right?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
It sounds really fancy too, Sean.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
All right. So having lived in Nigeria where we didn't have constant electricity, power banks are something I tend to keep in the house to charge items. So that's something people can consider as well. Sean, you also mentioned building community, which is very relevant to my life right now and I think as a whole. So I think this is something we hear about a lot.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
But what does it actually mean to do this? And how can community help people get through a difficult time?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Well, if you want an indication of how I've been doing, the past Thanksgiving, I got three invites. And on Christmas, I also got three invites. And I mean to people's home. And I've only been in Houston for six months.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Well, what can I say? I'm trying, I'm trying. No, but honestly, it's a testament to how much better I've gotten at building community. And that's by doing two things. So the first thing is being intentional. And the second thing is not making excuses. So for me, the intentional piece is me using Facebook groups and also Bumble friends to find people.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And then the second thing is to not make excuses by actually making an effort to hang out with them. So I'm proud to say that I've slowly started to build a solid tribe. I will also add that during Hurricane Beryl, the Facebook groups were a beautiful resource because all the moms in there, in particular, I'm in mom groups, were sharing resources for places offering free food.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Some people were even offering their homes. And they also just shared a lot of information on aid. But with that said, I want to go back to that idea of the broader community that you mentioned, though. What does that look like, Sean?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
I love that you have all these resources and little community, Sean. It can be so helpful. Honestly, I used to be a very isolated person, and I can say that my life is richer because of the communities that I'm now engaged in.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Absolutely.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And there's a lot more people can do beyond voting, which, of course, is always important.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So I do like the idea of five calls, but Sean, what if I hate talking to people on the phone and it makes me feel anxious?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
you get another gold star for that.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Hey, Sean. Have things felt a little, shall we say, shaky as of late?
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Beyond making calls, you can also donate to causes you care about or local organizations that need help. The goal here is really just to focus on the actions you can take that make a real difference and prevent you from feeling powerless because honestly, you're not.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Wait, what's doom spending, Sean? Never heard that before.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
I will say the three tips that you shared may definitely be less expensive ways of coping than doom spending for sure.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
We're about to turn to this episode's money question segment, where we talk with a listener about how they can pay off their debt while building up their emergency savings. But before we get into that, we're at one of my favorite parts of the show, the part where we ask you to take a second and think about where you need some guidance with your money.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
And a reminder that one of our goals on Smart Money this year is to talk with more of you live on the podcast to help you with your money questions. If you want to hang out with Sean and me for a bit and get some nerdy wisdom, let us know. One more time, leave us a voicemail or text us on the nerd hotline at 901-730-6373. That's 901-730-NERD.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
All right, let's get to this episode's money question segment. That's up next. Stay with us.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Well, this episode, we're going to help our listeners feel more prepared for what may feel like an unprecedented amount of shakiness.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
Michaela, welcome to Smart Money. Hi, thank you.
NerdWallet's Smart Money Podcast
How to Get Your Finances Ready for a Crisis and Tackle Debt Smarter
So when you think about where you're going to be in five years, tell us about what you picture.