The X’s & O’s

If we take a look at the financial landscape right now, we see a thriving real estate market, a low interest rate environment, and a stock market that is continuing to rise. Though the pandemic caused major disruption in March of last year, the economy seems to be recovering well, which is an important thought to keep in mind if you plan on retiring soon. Brent, Matthew, and Joshua talk about the factors that have contributed to the economy’s recovery, and some strategies you may be able to utilize under the current financial conditions.

The Hosts:

Brent Pasqua, Matthew Theal and Joshua Winterswyk


Brent Pasqua: Welcome in. And we are back. Retirement Plan Playbook is here. The group is back together. And I’m really excited for today’s topic. I’m your host, Brent Pasqua, founder of RPA Wealth Management. I’m here with my guys, Matthew Theal, Certified Financial Planner; and Joshua Winterswyk, Certified Financial Planner. Matt, you’re not looking so hot today. How you feeling?

Matthew Theal: Well, I’m feeling great now. I did catch the cold though last week, so that was fun. There is actually never a brief moment where I thought it was the Coronavirus and yeah, it was just a common cold. So, the common cold is going around, especially in Southern California. Since I caught it, I’ve heard of a couple other families who had it prior to me who I’ve actually never been in contact with. Be careful out there. Yeah, the cold is there and it hits hard because you haven’t had germ exposure most likely in a year. So, this one actually hit me pretty hard compared to colds previously.

Brent Pasqua: So, every time you get sick nowadays, it’s not COVID?

Matthew Theal: No, that’s correct, if you get non-COVID sick. I was pretty certain, it was never COVID. One, because people I was with had already had a negative COVID test by the time I was sick or had symptoms, but it felt like a common cold. Whereas, from everything I’ve read about, COVID, it’s not a common cold at all, it’s more in your lungs and it affects your breathing. Where this was more in my throat and in my nose.

Joshua Winterswyk: You didn’t have any of the unique symptoms like the COVID virus?

Matthew Theal: No, I didn’t.

Brent Pasqua: You’re lucky you’re here because Josh and I were having a sidebar, whether or not we’re going to invite you in for the show today.

Matthew Theal: Yeah. I know that was a highly-debated topic here at RPA. And we even moved some client meetings around because of my sickness. Yeah. So, thanks guys for having me in.

Joshua Winterswyk: I’m glad to see you.

Brent Pasqua: Out of an abundance of precaution, Josh and I completely sanitized the entire office after you were here last week, just in case.

Joshua Winterswyk: Do you think that’s a good sign, though? Common colds going around?

Matthew Theal: I think it’s a great sign, yeah.

Joshua Winterswyk: We’re kind of numbers are coming down COVID-wise and common cold’s kind of rolling around and …

Matthew Theal: I would try and catch it actually if I was the people, or at least get exposed to it so your body could fight it off.

Joshua Winterswyk: Get some germs in you.

Brent Pasqua: You’re here and we have a gas mask on you, so you’re not getting anybody else sick. We’re just glad to have you back.

Newspaper Boy: Extra! Extra! Read all about it. Let’s hear the latest hot takes on some recent news items.

Brent Pasqua: Let’s get into some hot take headlines. Digital currencies, like Bitcoin have been rising since March 2020, leading to really a new industry that is popping up. It’s called Digital Collectibles. What are Digital Collectibles, and what is NBA Top Shot?

Matthew Theal: Yeah. So, this is quite interesting. I’m just going to throw words out there big. The first one is something called NFT, which is Non-fungible token. And essentially what that means is it’s a unique token, kind of how there’s, I don’t know, 20,000 different Bitcoins out there or more. I want to know what the supply of Bitcoin is. I’m not an expert on it. Well, these NFTs are unique crypto tokens that go on a blockchain and they could be used for art or any other kind of collectible. And NBA Top Shot is one that’s doing it for highlights, so like a slam dunk or I think a three-pointer. And you could essentially purchase that highlight. And it has the blockchain technology.

Joshua Winterswyk: And so, when you say blockchain, basically a digital database.

Matthew Theal: Yeah. Yeah. Exactly. Digital ledger.

Joshua Winterswyk: Okay.

Matthew Theal: I guess you own this. It’s kind of the digital trading card and people are going crazy for these. And by crazy, I mean, I think a LeBron James sold for $100,000-

Joshua Winterswyk: That’s crazy.

Matthew Theal: … recently. So, yeah. That’s not good.

Brent Pasqua: And there’s only one person that can own this digital card, or can multiple people own this digital card?

Matthew Theal: I don’t know enough about it. I mean, I’m sure you could pull your money together and buy one of them. I guess like the three of us. Say we wanted to put $10,000 each in and maybe… We can’t a afford LeBron James, but maybe we could afford a Zion Williamson or a, I don’t know, an Alex Caruso.

Joshua Winterswyk: Kyle Kuzma.

Matthew Theal: Yeah. Maybe we can afford Kuzma.

Brent Pasqua: If we owned it though, nobody else owns it. It’s just us that own that one.

Matthew Theal: Yeah. Correct. Which is kind of cool.

Joshua Winterswyk: So, it’s more like a art. You’re purchasing a piece of art. It can be duplicated. It can be reran. You can have the straight licensing to only use it, but it’s for you to keep and say you owned it.

Matthew Theal: Yeah, exactly. The thing I don’t understand about this though, is I get why you’d want to own a Kobe Bryant autographed jersey. You hang it up. It’s yours. You can see it. It’s in your office. You’re like, “Yeah, I got that Kobe autographed jersey. That’s cool.” But a video of Kobe dunking on somebody, man, I could pull up on YouTube and watch like 30 of those right now.

Joshua Winterswyk: You go to your friend’s house, you’re like, “Want to see the video I bought?”

Matthew Theal: Yeah. You’re showing everybody and it’s just on your phone. I don’t know.

Joshua Winterswyk: You put it up on a projector.

Matthew Theal: The technology’s cool, but this is kind of gimmicky. And a lot of people are getting caught up in it. I don’t know if it’s going to end well.

Joshua Winterswyk: Two things that I kind of thought when I first reading about this was, pretty cool that the Blockchain technology is being used in another application, not just digital currency. I thought that was pretty cool that they’re using that technology and we’re seeing it progress. And then another thing is just like, cryptocurrency is so popular right now and then trading cards are coming back. It is kind of combining both of them. Kind of cool that, the two of the hottest, let’s say collectibles items purchased recently are combining into this new NBA Top Shot . Pretty cool.

Matthew Theal: Yeah. I got a couple of trading cards I was looking up. I think I have every Ken Griffey Jr. rookie card that was made. I heard about cards coming back, so I’m going to look these up, see what these Griffey rookies are going for. And I don’t understand why some are listed for 20 K online and others are listed for 50 bucks. If anybody knows anything about sports cards, send me an email and let me know. Because I love to get rid of my Ken Griffey Jr. Rookies. And I want to know if I have the ones that are worth 20 bucks or the ones that are worth 20 grand.

Joshua Winterswyk: I agree. I wouldn’t want that information. And it’s just a reminder that I got to start looking through my old trading cards. I still haven’t done that yet.

Matthew Theal: Got to go to our parents’ house.

Joshua Winterswyk: Exactly.

Brent Pasqua: One more question on this topic. Who’s playing with these digital collectibles. Is it the same people that are trading lots of Bitcoin and cryptocurrency? Is it the same fan base?

Matthew Theal: From what I’ve seen online, Yes. The article we referenced was a ESPN article and the guy who purchased, I think it was a Zion Williamson. He actually started a bunch of daily fantasy sports sites. I actually think he’s behind the underdog one that we played, fantasy football one. He’s the one who is purchasing those. So, yeah I think it’s mostly people who are into crypto taking their Bitcoin monies and now putting them into these NFTs.

Brent Pasqua: So, you’ve got this whole group that’s being created between fantasy sports, now, Digital Collectibles, cryptocurrencies, this fan group is actually growing in their hobbies.

Matthew Theal: They are, but most of them got their money by starting good old fashioned American businesses.

Brent Pasqua: Yeah. That’s what I thought. All right. Let’s move on. Lumber prices hit a new record high. Up more than 49% over the last few weeks, it never has really costs more to purchase all types of different lumber. These things are for walls, fences, cabinetry and engineered wood products used in new construction are currently backlogging until March. Matt, why is lumber rising?

Matthew Theal: Well Brent, that’s a great question. It comes down to supply and demand. And right now there’s just more demand than there is lumber. Prices are going higher. And the reason there’s more demand is the Coronavirus has really kicked off a bunch of home renovation projects. I just moved, bought a home and got some work done and all the contractors were super booked for the time we wanted. We actually had to go through multiple contractors before we could find one that could do our project on our timeline.

Matthew Theal: And then because prices are rising on the home side, builders are starting to pick up activity and they’re building homes. So, they’re all fighting over lumber. Basically that leads to rising lumber prices, which is inflationary.

Brent Pasqua: How is this projected to be actually long-term?

Matthew Theal: I’m not sure on the long-term side. I don’t know a ton about the lumber market, but I would assume if demand is strong, why don’t they just plant more trees. I mean, that could be a really poor answer, but I mean, that’s essential where lumber comes from. Washington, Oregon. I don’t know how long it takes to grow actual trees that get chopped into lumber.

Brent Pasqua: Yeah. I think that’s actually very interesting and curious to kind of what happens with home prices from there. I think it’s time to introduce a new segment. Let’s go into some planning tip. Josh, how does rising lumber prices and this really impact people’s financial plan?

Joshua Winterswyk: Well, one thing that we have to look at is if lumber prices are going up and other items within, let’s say home remodels or just appliances and homes and housing values are going up. It’s probably a pretty good time to get your homeowners insurance actually reviewed if you haven’t in a while. Most people like me, I probably haven’t reviewed mine in about a year and a half. I need to get on that as well, need to take my own advice, but now you’re at more risk.

Joshua Winterswyk: Originally when you took out your homeowners policy, cost per square foot to rebuild your house might be a lot different than it is today. So, you’re dwelling coverage within your homeowners insurance policy might be outdated. If there was a cover pro that destroyed your home, you could be under covered and that’s not going to be very good for there. That’s one thing is getting that reviewed. One easy way to do that is definitely calling your insurance agent. Whoever holds the policy to do a review with them, seeing what your coverages are, see how they’re related to today’s numbers. And one factor that’s in there, is number prices. It’s going to cost more to rebuild your home to you might need more coverage to protect you and your family. If there was something that actually happened to your home.

Joshua Winterswyk: While you’re also doing that, a lot of people purchased or adopted puppies or other four legged friends. Also, if you haven’t added that writer to your homeowners insurance policy, now’s probably a good time to add that if you did add a pet through this pandemic and most insurance companies do offer that writer to get some protection from your pets. Just another tip to that same topic is shopping for a new policy. At the same time, if you haven’t shopped your policy recently, now it’s probably a good time to see if you can get maybe even some more coverage at a better price.

Matthew Theal: So, I just went through the homeowners insurance process. And one of the things, the agent who was helping me mentioned was that lumber prices are rising. And that the costs of rebuild a home in California has actually increased in the last year. So, I needed to adjust my essentially, home rebuilt costs from what the computer was saying, even on there and because I mean, this was in December and so lumber prices are up 40% since then.

Brent Pasqua: I’ve had a lot of discussions about this with clients too. And when they’ve gone back and reviewed their policies, I think their policies were under-insured by 30 or 40% generally. I mean, for me when I got mine, I don’t think I looked at mine for seven or eight years until I changed it or redid it.

Joshua Winterswyk: Yeah. Because it’s not something that’s continuously pressing if you never had to use it. But just that reminder and getting that checkup was going to just pay you a lot of dividends If something were to ever happen that you’re properly insured and potentially having the best rate as well. Shopping, it is very important, but make sure that you have a credible insurer It’s another tip on that. And absolutely don’t let your coverage lapse. So, if you are shopping in an exchanging it, make sure that, that coverage doesn’t lapse.

Brent Pasqua: Then you should try and bundle it, if you get your homeowners, get your auto, get everything in one place. I mean that should be this substantial way to probably save some money.

Joshua Winterswyk: Yeah. That’s always the… Insurers love bundling and offering discounts. Definitely price it, do research on it. And hopefully you can get the proper coverage and maybe even save some money.

Brent Pasqua: All right. You guys ready to move on?

Matthew Theal: Yes.

Brent Pasqua: All right. Let’s go.

Brent Pasqua: Now that we warmed up with some hot techs, let’s go to the retirement planning corner and see what’s on the docket for today.

Brent Pasqua: Let’s head into the retirement planning corner. One question we were getting a lot from clients on is, why is the stock market going up? But the economy is really weak. Shouldn’t the stock market really be crashing? And really this is a two-part question and the answer really for me, I don’t think it’s straightforward.

Brent Pasqua: On the stock market side. Pretty much everything is at all time highs, US stocks, International Emerging Markets. I mean, it’s crazy. Everything is going up and money is flying into risky investments like SPACs, which are special purpose acquisition Corps, startups, IPO’s, cryptocurrencies like we talked about, digital collectibles. Matt, what is going on in the economy right now, is it weak? Is it strong? I can’t figure this out. What’s happening?

Matthew Theal: It’s recovering. It was weak last year. It was very weak this time last year, but now it’s recovering. And as for asset prices, what’s going on is there’s easy money with 0% interest rates. And when we’re at 0% interest rates, asset prices move higher. Homes, stocks, bonds, crazy investments like you’re talking about, start-ups, collectibles. Money’s easy. Money’s free flowing. NBA Top Shots. People are buying pictures of NBA dunks that we can watch on YouTube.

Matthew Theal: And right now the federal reserve is planning on staying accommodative. They have no plans to raise interest rates coming up this year. On the government side, there’s also $900 billion of fiscal stimulus done at the end of 2020. And they’re currently negotiating another $1.9 trillion. That’s a ton of money coming into the economy. And as for the consumer coming out of this recession, what’s the strongest consumer ever personal savings rates are at all time high and credit card balances are down compared to where they were in the 2008 recession.

Matthew Theal: And not to mention balances in cash accounts like checking and savings. Those are at an all time high. And you’re probably asking why is that? Because people aren’t spending any money right now, they’re sitting at home, they’re saving money. And every person that gets a shot is a person who wants to go out and do something fun now, they want to go on a trip, they want to do a sporting event, whatever it is they do for hobbies, they want to do it.

Joshua Winterswyk: There’s like so much pent up demand, especially in entertainment like you had just said.

Matthew Theal: Oh yeah, absolutely.

Joshua Winterswyk: And I think it’s just for the economy, just to see what has happened over this last year with personal savings rates, like you had mentioned going up, credit card balances going down. A lot of people have taken advantage of this last year of being locked down and if they were still fortunate enough to continue to work or didn’t spend all of their, let’s say unemployment or stimulus. It’s just creating even more pent up demand.

Brent Pasqua: It seems like the government’s really stepping up to control what part of the economy they can. But once they have to kind of relinquish a little bit of that control and they can’t keep just supplying money to it. Can the economy really start to stand on its own again?

Matthew Theal: Yeah. I think it is saying on its own actually, outside is a few industries, like what restaurants being one where there’s still a little hurt. My wife and I were looking at taking a trip to Hawaii and we thought the prices would be a little lower this summer because maybe people didn’t want to travel and prices are right back to the highest prices we’ve seen. So, prices are definitely rising.

Brent Pasqua: What does this actually mean for people’s retirement? What the economy and where it’s at right now?

Joshua Winterswyk: I think that there’s still a lot of opportunity and again, it’s just because we are saying that the economy is doing well, but it is being helped out. And there is some positives, but we know that there’s also a lot of negatives over this last year and that there is still opportunity to grow from those negatives going into 2021.

Joshua Winterswyk: I think with the economy, we don’t know what’s going to, for sure happen in the future, but we do know what’s happening right now. And taking advantage of those opportunities that are presenting themselves in today’s economy.

Brent Pasqua: One of the things that from a strong consumer standpoint, saving rates are really the highest ever people have more in their savings. What should somebody who’s planning for retirement, whether young or old be doing with that extra cash?

Matthew Theal: Buy an NBA Top shots, of course.

Joshua Winterswyk: Cryptocurrency.

Matthew Theal: Yeah, do anything risk it man. Risky investments. I would come up with a savings and investment strategy. Maybe it’s a little in the stock market. Maybe it’s some fun money in an NBA Top Shot. If that’s what you like, or Bitcoin. Maybe it’s investing in yourself and starting a business or doing one of those coding boot camps. Those are cool. And it pays really well right now. I mean, either invest in the future by buying a share of a company or a product or a logo GIF thing or whatever those Top Shots are, or invest in yourself.

Joshua Winterswyk: I also think, now’s a good time, like we talked about reviewing your homeowners insurance policy, but just reviewing your protection. Your net worth is increasing, you’re paying down debt, your savings accounts are going up or you’re starting to invest and now your net worth is growing. You need to be looking at other ways to actually protect that net worth as well. So, if you have now increased cashflow because of a better year Last year, we need to be also reassessing how we’re protecting that cashflow and that net worth going forward.

Brent Pasqua: Yeah, I think doing tax time too. I mean, if you have extra money, because you’ve gotten it this year and your savings is building to a comfortable level where you have six months of expenses. I mean, I would say make a contribution into your IRA or make it to your Roth IRA something long-term that you can actually, save some money on and save for retirement. It may help you in taxes if you’re making an IRA contribution.

Joshua Winterswyk: Great point.

Brent Pasqua: Josh, what are some other positives with this economy?

Joshua Winterswyk: A few other positives. One is the housing market. Housing prices have continued to increase. It’s due to low supply, high demand and low interest rates. I mean, we’ve been in this low interest rate climate for a while now. And those three variables have led to increase housing prices all across the U S. We’re seeing that a lot even right where we live here in Southern California.

Joshua Winterswyk: Another positive is the vaccine. After a Rocky start, the US now has the best vaccine program in the world. And we’re averaging about two million doses a day. And we have enough supplies for every adult to be vaccinated by the summer of 2021, really good positive there. And then lastly travel. High end travel prices are back to pre-COVID prices. Lots of people are planning summer trips even spring trips. We’re seeing again, some another hint of recovery through travel bookings and prices, again, another positive to this 2021 economy.

Brent Pasqua: You mean people are going to be able to travel again. What is travel?

Joshua Winterswyk: I know you kind of forget what that’s like.

Brent Pasqua: When I think about housing prices, If someone’s in a high housing price area, we’re in Southern California prices are high. But if you’re in a higher price area and you’re getting or thinking about retiring, I mean, what are some ways that you can really benefit from the sort of the time that we’re in right now. At least from what I’ve seen, like some of my clients do is downsize. They could sell their house, if they’re going to move to another state where houses are less expensive, I mean why not downsize.

Joshua Winterswyk: Yeah, absolutely. And it could be you just have a bigger home. You’re looking to relocate, maybe to a just a little tad cheaper of an area to reduce that mortgage just even by a tad to help some cashflow. Because prices are so high, but yeah, I think that’s the biggest one that stands out to me, which is moving to a different area where cost of living is cheaper, downsizing on price a little bit, and really just helping your financial situation even more if that’s your goal.

Brent Pasqua: I guess I have one other question for this. I mean, is it ever smart to sell your house at a high price where it is now? Rent, sit, wait for a while for the market to cool off, you hear people talking about that strategy. Is that ever really effective?

Matthew Theal: No, that’s an awful strategy. You’re being an active manager. You’re essentially making a bet that housing prices are going to drop. And that is most likely historically actually been a losing bet. Sorry if that’s your plan, but it’s not a good one.

Brent Pasqua: Yeah. I think that the strategy that we had talked about before is probably the most effective. That sell high and try and go buy somewhere else that it’s going to be cheaper for a house.

Joshua Winterswyk: Yeah, absolutely.

Brent Pasqua: If you have a two story on your way to retire, then you can downsize to smaller one story.

Joshua Winterswyk: Now’s a great time to just start reviewing those options because housing prices are so low and borrowing rates are so cheap.

Brent Pasqua: Yeah, Matt. What can cause the stock market and the economy turn down?

Matthew Theal: Well, the first thing that can really cause it to turn down as a crisis that we don’t see coming, and that was COVID last year. And most people forget the stock market crashed over 30%, last year in 2020, it already happened. It saw the Coronavirus, it priced it in, it crashed companies that were impacted most by the Coronavirus did the worst, companies that benefited from the Coronavirus did the best. Netflix, Zoom, Moderna who makes the vaccine. They all had great returns last year.

Joshua Winterswyk: Peloton.

Matthew Theal: Peloton. The companies that did really bad Carnival cruises, Hilton, Delta Airlines, the ones that were seriously impacted by the Coronavirus. Any kind of crisis they call them black Swan events. There could be another virus. There could be a war. There could be a terror attack. We don’t know what it is. It could be something like, that happened in Texas where the power grid goes off and billions of people are without power and electricity and they freeze to death. Any kind of crisis like that, that could derail the economy. It could cause the stock market to go down.

Matthew Theal: The other thing is, we’re actually seeing this week with the market turning South a little bit in tech stocks is rising interest rates. And what we mean by that is not the federal reserve raising interest rates. We mean the market is raising the rates itself in the form of bond prices. Rates going higher is an adjustment to stocks. It’s not always bad for stocks. It just makes people readjust what they think stock prices should be at and it causes them to fall in the short term.

Brent Pasqua: You know with these potential declines that could happen. I mean, could that stop you from advising a client to retire at the end of this year? Or is it do your planning and if you have enough then retire.

Matthew Theal: No, I think it’s absolutely do your planning. If you have enough right now, it’s a great time to retire. Why wouldn’t you want to retire? We’re telling you, the economy is strong. If you have enough, you have enough retire. What are you waiting for?

Joshua Winterswyk: That’s what I hear too. If you’re ready now is a pretty good time. Just make sure you’re ready for that retirement date. I don’t think that the time right now and the where the economy is at should be hindering you from retiring if you are ready.

Brent Pasqua: Yeah. I think if your portfolio has hit a level where you think you have enough to survive on the rest of your life, by just taking normal distributions and quite possibly, you may want to re-evaluate where the portfolio allocations are. And secure some of it.

Matthew Theal: Yeah. I agree. Great time to run a portfolio analysis. I still meet with a ton of people who are in their late sixties and they probably have too much in stock. So, they’re exposed if the stock market crashes and then they get scared and they’re like, “Well, I’m not going to be able to retire for another five years.” Where if maybe you just took a more diversified approach, you would work with a professional who could actually help you with your portfolio. They’d give you some advice and now you reduce your risk. And when the crash comes, you don’t lose as much.

Joshua Winterswyk: And I feel like we see that a lot. I mean, I do. I know you had just mentioned it and Brent, I think you can probably touch on this as well, too, but going into retirement, looking at an investment portfolio, I’d say more times than not, it’s either too aggressive or too conservative.

Brent Pasqua: And how detrimental would it have been last year? If you were planning on retiring at the end of the first quarter and on March 23rd, we hit those lows. And you started either rolling over your 401(k) and then sitting in cash for April, May and June. And gosh, I mean, it’ll take you a half a decade to recover from the returns that happened in that period of time.

Joshua Winterswyk: Yeah. If you weren’t really actively planning ahead, that can just cause a bunch of problems within your plan.

Brent Pasqua: Now, lastly, the economy is projected to get strong over the next few years, is now a good time to retire?

Matthew Theal: Yeah. I think we just hit on it. It’s a great time. I mean, being in control of your retirement, the stock market’s near all-time highest. That should mean that your 401(k) is near all time highs, as long as you’ve met with someone and you’ve kind of hit your number why not do it now?

Brent Pasqua: Yeah. And one of the strategies that I think worked in the past was interest rates on CDs or very conservative investments were pretty high. So, you can get a stable rate of return, but we’re not seeing any of that right now. I think any savings account is less than half a percent on the top end, just online savings accounts. I mean, fixed returns really aren’t there.

Matthew Theal: No, they’re not. And they’re not going to be there. I mean, most likely you’re going to live a good portion of your retirement with low interest rates if you’re in your sixties right now. So, I mean, maybe we’ll see 2% CDs, like we saw two years ago, but quick side note, slightly joking here. But you know, Josh did find a site that gives you 8% on your Bitcoin. Josh and I are getting 8% interest on our Bitcoin right now. Just like you would in a savings account. I mean, it’s out there, you just got a search for it people,

Joshua Winterswyk: Full disclosure kind of a joke. But yeah, no, I agree. Fixed rates are really low, but again, I think it’s just planning for the future. I think it can be maneuvered even with interest rates, even projected to stay low or fixed income rates projected to stay low. But if you’re not comfortable with those rates, like Matt said, Bitcoin cash, we got it. 8%.

Brent Pasqua: You know, I had a client walk up to me today and asked she was, telling me that her friend’s getting a 9% guaranteed return in her life insurance policy. And she said, “Is that true?” So, I mean, yeah, It just goes to show you, you can get stuck in all sorts of gimmicks. Let me tell you something. If interest rates are in the toilet and where they are right now, you are not getting 9% guaranteed on your insurance policy.

Matthew Theal: The only way I could think of that as if the friend is terminal Ill and they’re doing a, I forgot what it’s called, but where they pay off the life insurance. Yeah. So, then maybe her friends is telling her… Hasn’t told her something yet.

Joshua Winterswyk: Yeah. That wouldn’t be good. Insurance companies are not paying that many times the rate of the fixed rates. Yeah. And just to let the audience know they’re correlated right. Low interest rates at the bank means low interest rates everywhere.

Brent Pasqua: So if somebody is telling you high fixed rates, sister know it all neighbor.

Announcer: It’s time for RPA recommends.

Brent Pasqua: All right, let’s get into some RPA recommendations. Matthew, let’s start with you today.

Matthew Theal: I don’t know if I’ve talked about this before, I’m going to go with the whole HomePod setup. I might’ve mentioned the Apple HomePod great for music, but we recently got one of those mini HomePods for Christmas and you could set it up in different rooms. It’s so great. Listen to music. Cause you can get the whole house going. We have a big HomePod and a small HomePod. I’m going to get one for every room now. I have to buy a few more, but it’s really great way to enjoy music. Yes. Highly recommended. Oh. And it can be used as an inner-com as well. If you want to mess with your kids.

Joshua Winterswyk: I have a question. So, can the two HomePods play two different musics at the same time?

Matthew Theal: Yes. You could have like lady Gaga going in one room and then Taylor Swift in another.

Joshua Winterswyk: I knew you were going to say Taylor Swift.

Matthew Theal: I love Taylor swift.

Brent Pasqua: Now how much time did you spend researching this? Because I know it took you a little while to decide on whether you’re going to get Nest or RIng and you went back and forth and it sounded like that was a pretty dramatic-

Matthew Theal: For a HomePod. It took me… I don’t really research Apple products. I’m in the ecosystem. They come off wit a product. It’s just a matter of if I’m going to get gen one or gen two.

Joshua Winterswyk: Because I think like Google’s the other player in like the HomePod speaker system. Sonos does it as well.

Matthew Theal: Yeah. And I think the one thing to the people miss on Apple is Amazon and Google do not respect your privacy at all. So those HomePod speakers that they sell when they sell them for cheaper than the Apple’s, they are listening to every single word you’re saying. And they have computers transcribing every single word that’s being said on your house.

Joshua Winterswyk: So, wait, the mic off button actually doesn’t turn off.

Matthew Theal: That does not work at all. Whereas-

Brent Pasqua: Is this full disclosure, you know this?

Matthew Theal: No. Yeah. I know this. There’s been articles written about it. Just Google it by popular tech journalist. I think Wired had a big piece on it. Anyways, Apple though does respect consumer privacy and that’s kind of been their whole big push is through respect your privacy, not listening and record your conversations.

Joshua Winterswyk: Well, I don’t have a HomePod yet, but I am interested. So, good recommends there. Brent. You want me to go next?

Brent Pasqua: Yeah.

Joshua Winterswyk: Okay. I haven’t actually talked about golf in a while, I’m still playing. Matt are you still playing?

Matthew Theal: Rarely.

Joshua Winterswyk: Okay. I’m still playing though and I haven’t really bought any new clubs since I started playing. And, but I did get a new driver. So, I had some really nice friends for Christmas and my birthday gave me some gift cards. I use those. Thanks guys. And bought a new driver. Absolutely love it. I’m sad. I didn’t buy a new driver sooner because it feels completely different. I was using a driver that was made 15, 20 years ago. Got my new driver and really enjoying it. Really enjoying golf still, really nice to be outside. Plan to play a lot this year as well as I did last year.

Matthew Theal: I’m glad you finally pulled the trigger and got that new driver. That’s nice your friends help you out. Actually, last time I put it to you. I thought you said your cousin was helping you, but I’m glad your friends did-

Joshua Winterswyk: No, no, no, no, no. He said he got a hookup for a discount. Waiting for the discount It never happened. Friends definitely gave me some nice gift cards to help me out. Thanks guys. If you didn’t already know who you were.

Brent Pasqua: Well, as you guys are trying to recommend people to spend their money, I’m going to try to recommend people to save some money. By doing that, if you’re getting stimulus money from the government, what a better way to do with it, than to put it into your IRA or make a Roth IRA contribution. If you qualify to be able to contribute to your IRA or SEP or one of your retirement plans. Why don’t you take a little bit of that money in there and get some tax savings on it. Or if you don’t qualify and you can’t put it into your Roth IRA, you get some tax deferral, compounding interest tax-free upon withdrawals. This is a great time you’re in that season.

Brent Pasqua: You have until April 15th to make your contribution, ask your tax person. When you get your taxes in, can I make an IRA contribution? Can I make a Roth IRA contribution? If you can. Ask them how much IRA contribution will save you versus you putting it into your Roth IRA. If you can, you can do a quick calculation. Is it worth it? Roth IRA is tax-free on the way out. IRA is taxable on the way out. Does it benefit you now or benefit later, ask your tax person, which is best based on your tax return. Do a calculation and make that contribution because you can save some money.

Matthew Theal: Josh and I we’re out here recommending Apple products and golf equipment and you’re telling people to put their million in IRAs.

Brent Pasqua: I won’t be able to save some money during this tax season right now.

Joshua Winterswyk: It’s just not as exciting just to be really honest. But great recommendation. I actually forgot to even say. Well, I got a tailor made driver. So, just throw that out there. For the listeners who are wondering what kind of driver I got. I wanted to add that. but Brent, to get back to your recommendation, it’s a great recommendation. It’s just not as exciting. We’re telling people, HomePod, golf equipment. And then you’re telling people to save money. I love it, but it’s just not as exciting.

Brent Pasqua: For the listeners. Why don’t you guys reply into the show and let us know which recommendation you preferred to best. And then we’ll get kind of a tell going and maybe we can discuss it in our next show. Who they really appreciated more.

Brent Pasqua: A golf driver, a HomePod that’s going to listen to you while you talk, or a thousand dollars of tax savings when you go get your tax return down.

Joshua Winterswyk: Let’s just do all three.

Brent Pasqua: There you go. Matt as we kind of close up this shop, do not take your gas mask off, keep it on straight out the door, out to your car. Don’t contaminate us. We’re not trying to get sick.

Matthew Theal: I won’t.

Brent Pasqua: All right. So, as advisors, we love helping people. That’s why we do what we do. You’d like more information or schedule an appointment with any of us. Please go to RPA and schedule a complimentary consultation and also download our ebook on our website. If you’d like access to the show notes, please go to the retirement plan playbook. Thanks for listening to us. Please rank us on wherever you’re listening to your podcasts. Thanks for listening Retirement Plan Playbook.

Joshua Winterswyk: Thanks guys.

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