 The radical, fundamental principles of freedom, rational self-interest, and individual rights. This is The Iran Brookshow. Alright everybody, welcome to Iran Brookshow on this Saturday afternoon. Or at least this afternoon over here. March 16th, we're already in the middle of March. Spring is, yeah, I guess, isn't middle of March spring. Anyway, welcome. I was going over some old shows of mine and I realized I hadn't done a personal, the last personal finance show I did was five years ago. And I know a bunch of you have been asking for a show on personal finance. So here it is. I figured I'd do it today. And today is the day of positive shows. And personal finance is certainly one aspect of a positive planning, you know, planning your future. Yeah, it's pretty amazing that I did that show five years ago. I was going through shows and, God, I've done so many shows first. And over such a long time now, really I started audio only January 2015. So that's eight years now. That's eight, nine years. It's a long time. There's a lot of shows out there. And YouTube, I don't know, 2017, something like that. So there's a lot of stuff. But it's good to renew these things and renew them and remind you of them. And some of you probably are too new to have gone back and watched all the old episodes. I don't really expect you to. Yeah, so we're going to do personal finance. Now, remember, you know, a lot of what I'm going to say is pretty general and doesn't necessarily apply to any one of you. So if you want, you know, if you have specific questions about your circumstances, specific questions about where you are and the issues you are facing, please feel free to, you know, ask in the super chat. That's what the super chat is there. It's the benefit of listening live. Now, some of you are not live. You'll have to come onto a future show and ask or you can send me questions. So those of you are not live, but have specific questions on this topic or any topic for that matter. You can send me a question and make a contribution through PayPal or through Venmo. Those are the easiest ones, I think, for kind of one time contributions. If you just want to send me an email question with a Venmo or a PayPal contribution, I will try to answer them. And if there are a bunch of them on this topic, on the personal finance topic, I'll try to bunch them all up and do them all at the same time and maybe do a part two where I answer specific questions. But some of you are here live and so you get to ask whatever you want to ask. Just use the super chat feature. All right, let's see. Batista says, hi, from Argentina, you're on. Already have tickets for your visit. That's exciting. That's great. It should be a fantastic event. I'm still waiting to announce the surprise. But we will do that soon, I think, as soon as everything is official. But yeah, it's going to be fantastic. It's going to be a lot of fun. I'm looking forward to it. And it's coming up like it's in three weeks, right? It's right around the corner. All right, let's do this, right? It's got to be Millet, Jennifer says it's got to be Millet. I can't say it's got to be Millet, but I can't say. All right, but what about Millet and what's he going to do? And what's he going to say? Who's he going to say with? All of those are interesting questions that hopefully we'll have an answer for in the next few days. All right, personal finance. So points number one, and really the most important point, and they will frame everything else. Point number one. Oh, Silvanos is here. Excellent. Point number one is context. There is no one personal finance rule to apply to everyone. There is no one principle in a sense that applies to all circumstances. You have to figure out the context and we'll go over alternatives and variations of this. I mean, the principle is you want to live well today and you want to take care of your future. But beyond that, there is no such thing as, yeah, Richard says buy low, sell high. Yes. If you know that it's low and you know when it's high, buy low and sell high. But of course, the big challenge in investing is do you know it's low and do you know whether it's high? So let's just focus on, so we're going to get to that. We're going to get to investing. But this idea of, so the whole idea is you've got to understand the context. Your particular circumstances will dictate the specific strategy with regard to your own personal finance. Anybody trying to sell you a formula, anybody trying to sell you a one size fit all is conning you or thinks you're dumb. And therefore, you know, if you're dumb, then you just follow these rules, you have five things you should follow and all is good, right? So beware of people trying to sell you products that assume you are dumb. For example, you know, there might be people out there saying never take on debt. Really? Why? Debt can be valuable in the right circumstances. Not always. Depends on the kind of debt. Depends when, depending on circumstances. Or don't use credit cards. Why? Why not? If you pay them off every month, what's the big deal? Just many of these things, you know, just you've got to ignore kind of generalized, generalized advice that does not take into account, ask you about, you know, your specific circumstances. So let's think about the circumstances that matter. Well, certainly how old you are matters. Investment advice for young people is not going to say it be the same as investment advice for middle age or investment advice for older people. It depends on are you single? Do you have a family? Do you have kids? Do kids depend on you? Are the kids at home? Are the kids grown up? But they left the house. So how many mouths are you feeding, right? And what is that, to what extent do your kids play into your long-term plans? Do you plan to pay for their education? Do you plan to buy them their first home? Do you plan for them to live off of your money forever, right? Hopefully not. But all of those considerations determine how much money you're going to need in the future. So how old are you? What's the size of your family and what are your plans for the family over the long run? Maybe most importantly, what kind of job do you have? What are its prospects? Are you in a dead-end job where you're never going to make any more money than you make it right now? Are you got a career where the expectation is you'll make more money every single year, basically, until you retire or until you reach peak earnings, which might be in your 50s, and then maybe it flattens out or something. But what kind of career do you have? And how confident are you in that career in terms of its earning power? What are your earning prospects? And you have to really think deeply about that one because is your job about to be replaced by AI? How risky is your job? That is, it's not just what you expect your earning power to be over the next 50 years, 30 years, 20 years, whatever your horizon is. But are you being rational about that? Are you really thinking through, if AI comes and takes away your job, what are you going to do? Do you have an alternative? How confident are you? You can re-figure out, get a new job, design a new career. So really, what is your earning power? If you had to project from now until your 60s, what are you going to do? What's plan A? What's plan B? What's plan C? And what's the variation between those? Well, plans might be, I'm making more money. It's fine. Things are good. And that's great. So what are you earning? What's your risk tolerance? Are you somebody, and here you don't know judgment, you can change your risk tolerance, but assuming you are what you are at this point, you have a particular threshold for risk. If the stock market goes down 20% tomorrow and you have a lot of money in there, you're going to freak out emotionally. Are you going to just lose it? Are you going to not sleep at night? Sleep is important. Being able to have a calm, successful, enjoyable life is important. Is risk disruptive to your life? Is it something you cannot handle? And again, you have to be objective about who you are and what you are. To what extent are you willing to take the ups and downs of your investments or your savings into the future? And to what extent can you tolerate all of that? So what's your earning power? What's your risk tolerance and your capacity to bear it? Your emotional, psychological capacity to bear the risk? And maybe you say, my emotions are to whack, and I should really work on that. Maybe, but first adjust your investment or personal finances to the emotions that you have right now. And then as you get, I don't know, as you adjust them and become maybe more risk tolerant, you can change your investment strategy. You can change your savings. So nothing is forever. That is in that sense. If you choose a particular investment style, strategy, personal finance strategy, it doesn't mean you cannot change it as you move to the future. How much do you know about finance and how much do you care? I think that's important because that will tell you how much you're going to have to rely on outside sources. If you don't know anything and you don't really want to learn anything, that's fine. That's what you have. I know in this day and age, talking about experts is elitist and nobody wants to rely on experts. I'm sure you are all self-medicating at home and when you need your appendix out, you'll do it yourself or maybe you'll have your spouse do it for you. But there seems to be an attitude of anti-experts. But if you're not interested in learning about finance and you don't know that much about it, you probably want to hire an expert to help you out. You probably want to get advice from one of those elitists who actually know something about the topic as just like you do for your health care, I hope. Although you could just listen to RFK and not listen to your doctor. What else is context? Age, earning power, risk tolerance, knowledge, knowledge, all of those are crucial. One other aspect of this should be, do you have a lot of money already? I mean, is this not about, in a sense, survival? You're done, you've gotten enough money, maybe you inherited a lot of money. Maybe you had a point in life where you've already got a lot of money, you've already earned it, you're sitting on a big pool of money. Maybe that's the case. So that's going to be a different personal finance advice than if you are basically making the money that you spend every month that you're basically living off the money you earn, like most of us. So again, all of those factors have to play a role. BB says, cut up credit cards. God, I don't think I have, you know, the credit cards now, like this one, they're made out of metal and you can't even cut them up. So the whole advice about cutting out credit cards, yeah, don't pay attention. Also, what do you think about, you know, how much complexity can you tolerate? That's another aspect of this, right? How much complexity can you handle? You know, your finance can be super complex, lots of different things going on, and can you manage that? Can you tolerate that? Is that okay? Or is that going to overwhelm you and drive you nuts and not worth dealing with, right? For example, can you handle three credit cards, 10 credit cards, one credit card, 20 credit cards? I don't know. Or is that just too much for you? All right, those are some of the considerations. So let's break this down a little bit. And then again, I think this will be particularly valuable if you ask questions, right? So what's really important here is for me to address some of the issues that you might be facing, or that you might have questions about, or that you might be struggling with. You know, Kim says, buy some Bitcoin. All right. You know, if that's your only strategy for personal finance, good luck to you. But that is a pretty disastrous and scary proposition. Although I know a lot of people who've done that, and right now they're writing high. Right now, they've made a huge amount of money and can't argue with that, right? We're looking so great a year or so ago, but that doesn't matter because they're willing to wait it out until whatever. I don't know until Bitcoin becomes money or whatever happens to Bitcoin in the long run. But you might want to buy some Bitcoin. Nothing against buying some Bitcoin. But it's a risky asset, very volatile. And I doubt you want a significant percentage of your net worth in Bitcoin. It could go to much, much higher than it is today, and it could go to much, much lower than it is today. And the only thing driving it up or down is, in a sense, the degree of passion of speculators. That's it. It's a speculative asset. So that's what drives it in one direction or the other. Nothing more, nothing less. Okay. So let's break this down a little bit and let's start with what I think is the most important part of personal finance and really the thing that sets everything else, sets in motion, sets in context or sets everything. And that is earnings. At the end of the day, what really matters in finance is making money. How much money you can make. That is the key. And while some very rich people and some, I don't know, trust fund babies or some children of very wealthy parents or whatever, have enough money so that they can live off of their investments, most of us have to work for a living. Most of us actually have to engage in productive activity and should, because it's virtuous for other reasons, but engage in productive activity to earn money. And look, there's nothing more valuable that you can do in terms of your future and in terms of your personal finances in the future, in terms of your ability to have wealth and to pursue consumption and live well financially, then invest in your earning power, invest in your career, invest in an upward trajectory in terms of the money you are going to make, the money you are making and the money you are going to make. So this is not necessarily personal finance, but this is the starting point and this has to be your primary orientation. Everything else is a sideline. Everything else in terms of finance is a sideline. How much money can you make? And, you know, is your job, are you making enough to be able to live if you adjusted your consumption, how much you are making? But are you happy with how much you are making in your job? Can you do better? Do you want to do better? How important is money to you? And then can you earn enough to fulfill whatever once you have, whatever realistic once you have? So the first focus you should always have is on your own productivity, in your own abilities, in your own, whether it's education or whether it's just professional training or whether it's experience or whether it's just different career experiences. Invest in yourself, invest in your career. Figure out how to maximize the earning power of, you know, given how hard you want to work and how many hours you want to work and so on, maximize the earning power of whatever skill set, whatever education you have, whatever abilities you have. And that should be your primary focus. That should be your primary focus. Your wage will go up as you become more productive. In other words, as you produce more, you will be paid more even if you're a salaried employee. And if you're not, change jobs, right? Change employers. So keep driving your abilities higher, keep gaining the skill set to be more productive, keep engaging in productive activities and keep trying to get promoted and trying to do more. If you're inclined to open a business, if you're entrepreneurial, then, you know, focus on that. And look, the focus here is not on trying to maximize your earning power today because it very much could be that, you know, and here earning power is not just money, it's also, you know, productiveness and being productive in life. But it very well could be that you have to take a few years off to go to school, to travel, to do whatever, to learn a skill, to... Before you can maximize your earning power, that is, it's what you're trying to do is maximize your earning power given what you desire, given what you want over a lifetime. And you might want to take a lower pay today, you know, to make much more money tomorrow, like by going and getting a master's degree or something like that. So you've got to figure out what do you, what can you make? How much can you make? And then the second piece of that, of course, is you've got to gain an understanding and a deep knowledge of your own consumption behavior. How much do you consume? How much do you consume in a month, in a year? What do you consume it on? Are you happy with what you consume it on? I mean, we live, in a sense, by producing so that we can consume. At the end of the day, we have to eat. You know, we have to do good to the doctor. We have to do things. All those things cost money. We work partially in order to fund all these other activities that are necessary for human life. And, you know, so you should have a good grasp of what are you spending money on? And are you spending money on the things that you want to spend money on? Are you spending money on things that are important for your thriving, flourishing, and ultimately happiness? Are you wasting money? I don't know. Are you gambling when you can't afford to gamble? Are you gambling more than you could afford to gamble? Are you spending money on frivolous stuff that you can't afford? Or that is causing you, you know, challenging, you know, your income. Are you living beyond your means now? You could for a while live beyond your means. We'll get to that in a minute. But is this a pattern? Are you generally consuming more than you bring in? Are you going into debt in order to fund your consumption? And if you are, can you see an out of this? And step one for this is understanding your consumption habits, understanding what you consume money on. And here, you know, I strongly recommend getting some kind of piece of software, some app, something. This just keeps track of everything you spend money on and keeps track of your income. I've been using Quicken. I've used Quicken basically. I have financial records, I think going back to 1991. I think I was using Quicken 1.0. I don't know what version they have these days and they've sold and they've got, you know, the software has changed hands. But it's still called Quicken. And I use it. I don't think that you, everybody needs to use Quicken. There are lots of other things. If you only have one bank, if you have all your relationship with one bank, you can get a breakdown of all those things from your bank. You don't need more than that. There used to be a software product called Mint that used to aggregate all these things. But I have multiple banking relationships. I have multiple credit cards. I have saving accounts. I have brokerage accounts in a different bank, you know, where my investment is. So I need something that aggregates all that information and brings it all into one place, all into one place. And it is incredibly valuable. And the earlier you start doing this, the better because then you can see what your consumption, you know, pattern trends are. You can see what your income trends are. You can see what your debt trends are. You can see, you know, you can take a look and you can see your financial life. I mean, I have data, literally data on expenses going back almost 30 years. No, more than 30 years, right? 33 years. That's ridiculous. Now, at this point, it's just a curiosity because I have no interest in going back other than to see how little money I made. That's always fun to see. I made this little money, you know, I spend more that entire yearly salary. Anyway, so, you know, it is valuable. Of course, with credit cards now, I use credit cards for everything because part of the reason I use credit cards is because when I download that data, when that data gets integrated into my software, it tells me exactly what I spend it on. It has categories and it puts it into the category. And I can tell you exactly how much I spend at restaurants, grocery stores, concerts, you know, whatever. Doctors' bills, everything. You can get cash back. You know, I like to accumulate travel points because I travel so much. So I have gazillions of points that allow me to fly free to all kinds of places and stay at hotels for free and things like that. But you can also just get cash back if you don't travel a lot. Cash back makes a lot of sense and that basically gives you a discount of any way some of these cards will give you up to 5% cash back, basically giving you a discount of 5% on everything you buy. The only thing you have to do with credit cards, it's very simple. It's very simple with credit cards. Always, always, always, always, always because credit cards are the dumbest form of debt in the world. Always, always, always, always pay off your credit cards at the end of the month. The entire amount, whatever you get the bill, pay it off. Now even that, right, is so simple now. Basically, my software basically does it for me, right? You know, I have automatic payments on every single one of my credit card accounts. It has my bank information. It automatically takes the money out of my account and pays. I don't have to think about it. I just have to make sure I have enough money into my bank account. But even that quicken will tell me you need this amount of money because, look, these credit cards are coming out in the next few days. So you can move money from accounts and everything. So I'm a huge fan of having something like quicken that aggregates your accounts, automates, automates. You know, what you have, automates all your bills, pays all your bills, automatically pays your bills. So again, you don't miss bills because the worst thing is to miss a payment and get penalized and pay interest and penalties and all this stuff. That's when you can really get into financial harm and financial problems. And again, there is so many different ways in which to do that in the modern world. I use quicken. Maybe quicken is too much for most people. It's a pretty, it's really robust. It has lots of features. It's online and it's an app on your desktop and it's on the phone and I never use it on the phone though. But you can. It's pretty cool. But it has, I don't even use probably, I use probably less than 50% or maybe less than 40% of the features that it has. But it's worth it, God. I don't know what I would do. I don't know how I would manage my personal finances without something like quicken. How much is it? I don't know. I think it's kind of a monthly subscription at this point, but I don't remember how much it is. Again, there's, I bet you there are cheaper versions. The simpler ones. Again, quicken is for, you know, complexity. I have complexity. You might not. But quicken I think right now is the gold standard for personal finance, keeping track of it. Right? Keeping track of it. Just, just right now, somebody Google quicken and see how much they charge. And you'll find out how much, how much it is. I don't think it's $2 a month. It's $2 a month, maybe. But whatever it is, I don't know if you have any kind of complexity in your personal finance, it's worth it. By far. So you want to know what your consumption habits are and you want to know what your income is. Particularly, you know, some of you might not have a steady income. You might not have one job or you might not have a job. You might be self-employed. You might have a business. And the business probably has its accounting over here. But you want to see what is flowing to your personal account. How much is it on average in a given year? You want to, you know, you want to, in those cases, you want to always plan for the taxes you're going to have to pay because they're not being deducted out of your paycheck because you're probably not getting one or you're getting a small one. Some of it is being distributed to you as dividends or capital distributions or whatever. You want to see what's happening in your investment portfolio. You know, again, this will track everything. And it's really cool. Mint. Mint used to be, and again, I don't know if it's still, it used to be really, really good. It was the first all online personal finance app. It was actually created and it was founded by somebody who at the time at least was an objectivist. I don't know if he still is. But at the time it was an objectivist. He ended up selling the company, I don't know, for $300 million to QuickBooks. But Mint is, and they destroyed the product and Mint is no more. It doesn't exist anymore. But there are others. Somebody says here that they use Empower. Empower. Again, there's tons of options. They're free options. Right? They're free options. So I highly recommend, here's my biggest advice now, get a personal finance. So you can track what's going on. If you can't track, if you don't know what's going on in your finances, how are you going to manage them? All right. So know how much you earn and know how much you spend. And think about other things that you spend, what is optional and what is not. What you can do without what not. That doesn't mean you have to cut out the optional stuff. I mean, the optional stuff is the fun stuff, right? But you should have a good idea of, if I need to, you know, how much could I cut my spending? How much could I get, how much could I cut from my monthly bill? Right? And yeah, and it's good knowledge to have because that'll help you, again, plan the future and it'll help you if a crisis comes, if you lose your job, if something happens that's negative, it'll help you say, okay, but I know I can cut this amount of expenses and I have this amount of money and my new job pays this, that I'll be okay. All right. You want to know your own, you want to know your consumption. You know, mostly, you know, your earnings should be higher than your consumption. But here is where it doesn't always have to be. And this is where I get controversial and maybe some people resist this. You know, if you can find cheap ways of borrowing money, don't borrow from credit card companies. That's extremely expensive. Never borrow money from credit cards unless you can get these deals, which, you know, I get in the mail offers all the time for 0%, 18 months, 0% debt. Now they want to, usually they want a 3% transfer fee sometimes, but if you just charge stuff on the card for a certain amount of time, they'll give you 0% interest. I love 0% interest. I find it difficult to resist people offering me money at 0% interest. It's like free money for a while. So I find that hard to resist. But you know, if you're confident in your earning power into the future, if you're confident that next year I'll make more money than today and the year after that, then taking out a certain manageable amount of debt for a while for a good reason, I wouldn't do it for just frivolous consumption. But for example, if you're going to start a business and it starts some kind of small business, it's not a business that you're going to get venture capital for or anything like that, but it's something that you want to take a shot at, you want to try. Then of course the primary source of capital for a business like that is probably you. And that's probably going to mean you taking on some debt, going to the bank and asking for a loan, finding ways to access debt that you can, that you can then pour into the business because the business isn't almost upside. Now there's a risk there that the business might fail and you have to be able to live with that risk. You have to be able to live with the knowledge that you have a lot of debt. You have to be risk tolerant. You have to not allow it to keep you up at night. But taking on debt, for example, to start a business is not a bad idea. It's actually what debt is for. It's what banks are for, to invest in a productive capacity. So if you're investing in your own future, if you're investing reasonably in your own earnings power, then absolutely debt is a great way to make that investment happen, given that you probably don't have an alternative to that. You probably don't have the cash lying around to make that investment. So I don't think there's any issue with taking on debt if what you're using the money for is rational and appropriate for where you are in life and rational and appropriate in terms of expectation of being able to pay that debt off and your confidence and your earning power into the future. And you can handle risk. You can handle the stress. Ali says, I wish your honor was one of my relatives. I would get a lot of advice. You can get a lot of advice without me being one of your relatives. Just ask a question on the super chat and I'll give you the advice. So there you go. You actually don't have to actually be a blood relative in order to... We're all family here, right? Well, most of us, anyway. In order to get advice, you just have to pay for it. Pretty cheap, though, given all things considered. Or for example, if you buy a house, most of us take on a debt in order to buy a house. It's called a mortgage. And it can be 20% of the value of the house. The debt can be massive. If you buy a million dollar house, you might be taking on 800,000 worth of debt. That seems like such a big number. But the debt is sped over 30 years, can be sped over 30 years. And generally, I suggest getting fixed rate mortgages. If interest rates come down, you can always refinance. Make sure that it's refinanced a bull, right? That it has a provision that allows you to refinance. And make sure you can afford to make the multi-payments. That is, look at the multi-payments that are involved over the next 30 years. And make sure you have the income to be able to afford to pay it off. Generally, you know, variable rate mortgages are often cheaper. And often over the life of the loan, you're going to pay less. But they clearly involve more risk. People who took out variable rate mortgages at any point in time in the last 15 years, over the last three, four years have suddenly got a shock. Because suddenly their multi-payments have gone through the roof. The beauty of a 30-year mortgage is that it allows you to clearly plan. I don't know. You're paying $3,000 in mortgage every month. You know that. It's every month. And it's every month, it's steady. You know that. It's going to be that way for 30 years. You've got to structure your income to be able to afford it. And before you take out the mortgage, make sure that, again, your expectation of what your earnings are going to be matches the mortgage you have taken on. Matches the commitment you have taken on in terms of monthly payments. And look, you're probably going to sell the house before 30 years. You probably won't pay it. But it doesn't matter, right? You'll buy another house. You'll take out another mortgage. And you'll keep rolling with it. If the value of the house goes up, that's fantastic because then you've only put out 20% on the house. Maybe you've even put out only 10% of the house. Or maybe, like I did once, put 0% down, took everything out in debt. Then every time the house goes up, that is all profit for you. And when you sell the house, you pay off the mortgage and you keep the rest. And that can be a pretty sweet deal. I've been lucky, mostly, lucky with my homes, at least. The first two homes I was very lucky with. The third one, not so much really. Didn't lose any money, but I didn't make any money really. And we'll see about this one. So far, so good, but we'll see. But you shouldn't count on your house value going up. This is another piece of advice that goes counter to everybody out there. Housing is not an investment. Now, it might turn out to be because we have a screwed up political system where there's a shortage of housing, which means that as long as demand is there, the price of houses go up. But you can't count on that because it depends completely on the irrationality of the government. And if for some bizarre reason, unexpectedly, completely unexpectedly, the government frees up the housing market, then your house price could go down. Or if they shut the borders down and no immigration and the population in the United States starts shrinking, long-term, your home value will probably go down, of course, depending on where you live. If you've owned a home in the Midwest, a lot of the homes in the Midwest have lost value. People don't want to live there. So, again, don't count on your house as an investment. Houses are a consumption product. In a free market, they would start depreciating that is going down in value the day you moved in, just like with a car when you buy it. But it's still worth doing because, look, if you have to pay cash for a house, the house you really want, you'd have to save money for 30 years before you could buy it. Instead, buy the house now and pay it off over 30 years. It's an incredibly rational thing to do, particularly given that the government actually allows you to deduct your interest payment on your mortgage from your taxes. So, let's say you're paying, I don't know, 5% mortgage. I know it's higher today. And your effective tax rate is 20%. Then you're actually only paying 4% mortgage because 1%, 20% to 5%, you get back from the government or you pay fewer taxes because of it to the government. So, and when you do a comparison with rent, you should take into account the fact that mortgages are tax deductible. And am I spending more monthly than which one? And of course, you also should take into account that when you buy a house, you have to put money down. When you rent, you don't have to put money down. So, in both cases, you have to compare it properly. You can't just compare the monthly payments. You're also locking away a certain amount of money by having a down payment. Now, in a market where housing is going up, that's fine because if it's a million-dollar house, you put $200,000 in. If the home price is going up, then $200,000 is gaining value over time. But if housing is flat or down, then it's sitting there and that might tilt towards rent being just better, more affordable. And of course, you need to think about is it important for you to own a place versus renting? What are the advantages of ownership? You can make changes to it. The first home I bought, I was renting it and then I bought it because the owner was going to sell and he gave me the first option and I landed up buying it. And the first thing I did was install air conditioning. There was no air conditioning in the home. And I couldn't have done that as a renter. So, it gives you an option to improve the house, to renovate it, to do things to it that you wouldn't otherwise do if you were a renter. So, a lot of things like that, you have to take into consideration. On the other hand, if you're renting a place that's pretty perfect for you, then renting is fine. Renting is no problem. I know people feel uncomfortable with renting, but there's nothing wrong with renting, particularly given big swaths of our lives when we just don't have the... I don't know, we're not going to be in one place for a very long time or we don't have the income or we don't know where we want to live or we haven't found the place. Renting is fantastic. Other forms of debt. I mean, car loans. You can't deduct the interest payment. But again, it's a way to buy a car and not have to plunk down a chunk of money and be able to pay it off over time. I find it quite useful. Now, if the interest rate is nuts, if it's really, really high, then it doesn't make any sense because you're saving money. You didn't put the chunk of money in. But if that money is not invested at a higher rate, let's say on generally on your investment stuff, you make over the long run 8%. And your car loan is higher than 8%, then don't do it. Take the chunk of money and pay it. So you have to take into account. But if the car loan is at 4% or 5%, then it's worth doing because you're probably earning more than that in your long term savings, long term investments. And again, whether you can do these monthly payments, mortgage, car loan, et cetera, is going to depend on how much money you're making. And what kind of car you're going to buy and how expensive a car you're going to buy and therefore how big of a debt you're going to take on is going to depend on how much money you're making. And what is your confidence level about how much money you're making in the future? The more optimistic you are and rationally optimistic, that is the more sure you are of your earning power into the future and your ability to earn into the future, the more debt you can take on. Rationally, the more risk taking you are, the more you will need to take on risk and you don't panic and you don't not sleep at night, the more risk you can take on. The more risk averse you are, the more fearful you are, the more worried you are, the less certain you are about the future, any one of those parameters, the less debt you want to take on. But the idea that debt is wrong, bad, evil, nobody should do it is just crazy because it assumes we're all incompetent. It assumes we can't assess our earning power into the future. It assumes we all can't handle risk. It assumes we don't want to invest in ourselves. Student loans is another thing that in a rational world where the loans were properly valued and everything, if the loan is geared towards making you more productive then it's worth doing. It's absolutely rational to do because it's increasing your earning power. It's an investment in yourself. But if you're going to study gender studies and so on, I don't know that the bank would give you a loan because what are your earning power afterwards? And it's not actually making you more productive so I wouldn't take a loan to go study something that's really just a hobby or really just something you're doing for fun but it has no productive outcome, productive consequences. We covered a little bit of debt and of course I'm happy to take questions about that. There should be a lot of questions. You guys know everything. Particularly $20 questions, $50 questions, $100 questions would be great. I'll get to the questions in a minute. Let's talk about saving and investing. I mean you need to think about how much you want to save for the future. And there are various categories and various buckets you need to think about in terms of saving. Now investment is a subcategory of saving. Investment is a form of saving. The whole idea of saving is postponed consumption, delayed consumption. It's the idea that this is money I'll consume later on. You shouldn't have the idea that this is money I'll never consume. Why, what do you need the money for if not to consume? This is money I'll leave my ancestors. Maybe you want to leave your kids a little bit of money but most of the money you make in your life you should want to consume. You should want to enjoy it. You should want to benefit from it directly. So you want to think about saving in terms of buckets. Short term, medium term, long term. Short term might be I want to save money so I can go back to school. And I don't want to take on loans for everything so I want to have some money so I can maybe the loans will pay for my tuition but I need some money to live off of stuff even though I might work. So it could be short term, saving could be around I want to buy a car one day so I'm going to save some money so I can put a down payment on a car or buy it outright. If interest rates are high I might as well just buy it outright. Medium term saving might be I want to save enough money so I can put a down payment on a house. I'm renting right now. I want to be able to put it down to $200,000 if I'm buying a million dollar house. So you want to be thinking in terms of a down payment. How much do I need? I need $200,000 if the house is a million. How long is it going to take me? And you want to save enough money so and depending on how important the purchase is, how quickly you want to get the house, how important it is, that will determine how much you save in order to achieve it. And then long term saving and I would say long term saving here is really long term saving which is for most of you guys who are young is retirement savings. You know my income will probably start declining at some point let's say 65, maybe 70, maybe 75. I, you know I intend to work because well we all love our work and we're super productive and we enjoy it. So I'd like to work as long as I can but at some point I might want to work part-time. I want to work a little less and over the years I might want to shrink them out of work that I do. And ultimately I might have to retire and not work at all and I want to be able to have enough money to be able to live off of that. Now my view of things like Social Security is don't count on it. Don't count on it. Who knows by the time you retire what will be there. Who knows what the government will want to do with it. And it's not a huge amount of money anyway. Don't count on it. Save so you can live the way you want to live in retirement. And Social Security money is like a bonus. Think of it as a bonus. You'll get an extra few thousand dollars, two thousand dollars whatever it is when you retire and you can do that to spend on fun stuff. But you want to be able to have enough savings so that you can retire comfortably and again what comfortably means depends on you. Whenever you want to again depends on you without having to rely on I don't know the ability of the government to pay you off because they might not be paying you off. And it's your money right. Social Security technically is your money. You're putting it away with Social Security but they're stealing it right. Every dollar you pay for Social Security is going to pay people who are in Social Security today. They're not saving your money for you. They're taking it from you so just don't count on it. It just doesn't make any sense to count on it. So for each one of those buckets you want to have a different strategy. A short term saving need to be in something super safe. You're not going to make a lot of money on it. You're just putting it away gaining some kind of minimal interest and where it will grow over time very, very slowly. But the main way in which it grows is you adding saving into it because you're going to take it out and you want to take it out relatively quickly and you want to make sure it's there because you're going to need to buy that car or you're going to need to spend this money on schooling or whatever it is. You don't want, you don't want to take a risk with that money. Don't want to take a risk with that money. Your medium term saving can involve a little bit more risk. You've got a few years now to make the saving happen. If you can to grow it you might want to have some of it in the stock market. You want to have some of it in a saving account or something that is less volatile, something that's more secure, particularly these days when a saving account actually pays you a little bit of interest. And you want to add to it every month. You want to have a plan in terms of when you plan to buy the home. Maybe this is contingent on when you plan to have kids or you just got married and you're saving together to buy the home. So you want to have a plan in terms of how much you want to save, how much you want to save or also depend on how much you're making, how much you consume, all of that. But you want to have a plan on how much you put away every month so that you can achieve the $200,000 for down payment someday in the future. $200,000 is a pretty scary amount but that's in California where you can't buy anything for less than a million bucks. But in a lot of other places in the world you can buy homes for a lot less than that, start a home for a lot less than that and you can save less than that. But I'm also assuming you guys are ambitious and you guys can make a lot of money because you should be ambitious and you should be able to make a lot of money. We have a smart group here listening to your own book show that should be quite ambitious and in careers that could do well. So the medium size bucket, you should be able to take on some risk. Risk means stocks, bonds, and then some in cash. The exact distribution will depend on how old you are, how many years you want to save this for, how crucial it is. Of course the less variability you can handle because you have to buy the home next amount of time or whatever, the safe of the investment should be. The safe of the investment should be. But again, you don't have to save the million dollars for the house, you only have to save the 20% because debt is okay. I hope you guys buy a lot of Bitcoin on the dip and make a lot of money and then contribute it to the online institute and to the UN Book Show. I expect to see now with Bitcoin at close to all time highs, I'm shocked that my super chat, you know, the super chats are not going through the roof. You're not adding a lot more to the super chat. You should be. You guys, all your Bitcoin guys should be super rich at this point. All right, what about those long-term savings? And here look, if you're very young, if you're in your 20s, you know, the long-term savings should not be a high priority. The biggest priority for you in your 20s is the short and medium term and it should be to consume. You should live fairly well and you shouldn't worry in your 20s too much about retirement. Now, if your company offers you a 401k, a 401k is a vehicle where you can save money with pre-tax dollars. You won't have to pay taxes on them until you withdraw it when you're retired, which is in a long, long time from now. You might as well max out on your 401k. So generally max out on tax-free investments. And particularly if your company matches your contribution to 401k, then max out on the company's contribution, your company's match. But your primary focus should be when you're young on your short and medium-term savings, not on your retirement. You should also be thinking when you're young, for some of you, depends on who you are and what you are. Whether you're an entrepreneur, whether you want to start a business, whether you think that that's in your future, and if it is, you should be saving for that. Don't save for retirement at the expense of starting a family, at the expense of starting a business, at the expense of living a decent life, particularly if you believe that your income will loan you eyes. Now, you shouldn't mimic me, right? But I didn't start saving for retirement until my late 30s. And then most of the saving for retirement was part of a 401k, almost all of it was a 401k where the employer matched the whole amount. So I maxed that out because I wanted to get the employer match. But I was always confident that my income would be higher next year than it is today. And as a consequence, it was, okay, you know, at some point, I'll be at where I want to be from consumption perspective. I'll be where I want to be in terms of my short-term and medium-term savings. And at that point, I'll start saving for retirement. Now, I'm not saying everybody should do that. Some of you might want to start in your 20s, might want to start in your 30s. But when you start that, the saving for retirement, make sure you do it in a tax-free account, whether it's a 401k, an IRA, a SEP IRA. A SEP IRA is really interesting because the SEP IRA is where you invest the money post-tax. This is money you've already paid taxes on. But all the capital gains that accrue inside the account are tax-free. So when you withdraw the money, you don't pay any taxes, no capital gains, no income taxes because you've already paid the income tax. It's tax-free. SEP IRAs are really, really good. If you're investing when you're very young, you know, the capital gains that you will accumulate over the account, hopefully, are going to be substantial. You're going to more than double your money. You're going to double it many times over, I think. And as a consequence, it's much more important for you to minimize the capital gains taxes than it is income taxes. You'd rather pay the income taxes now, but save on the capital gains taxes for when you retire. Oh, sorry. I'm not talking about a SEP IRA. You're right. Thank you, Richard. Yeah, when you get old like me, you have to watch these things. I'm talking about a Roth IRA, Roth, O-O-T-H IRA, not a SEP. SEP is like, it's a tax-free kind of retirement account for small businesses. So it's something to consider if you're a small business. There's such a thing as SEP. The nice thing about a SEP IRA is that if I remember right, the limits in terms of how much you can put in the SEP IRA are much, much higher. Now, all of these, you're going to have to figure out, you're going to have to get the exact details on what are the limits and how much you can put in and so on. But when you're young, save in tax-free ways Roth IRAs, SEP IRAs if you're a small business, 401Ks, all of those kind of things, you should be saving in that format, right? Once the money is in one of those IRAs, you can then decide I'm putting money away into stock market, bond market, cash, however you want to save it. But it should be structured in one of these tax-saving accounts. Mike, you really should use this, which I had to ask a question. But since you asked, HSAs, which are house-saving accounts are fantastic. This is another way in which you should be saving long-term. This is a great way to save for retirement, but also to save for just expenses of anything you spend on health care. Now, it turns out most of your health care expenses will happen as you get older. It's HSAs, house-saving accounts that form both medium-term and long-term saving. You don't pay any taxes on them. You don't pay any taxes when you put it in. You don't pay any taxes when you withdraw. You don't pay capital gains taxes if I remember right, but you can only use them any money for health care. But that's fine because we're going to need money for health care in the future. We just are. So HSAs are health-saving accounts. They are fantastic. Use them, take them. There are all kinds of other things. There's an education-saving accounts for your kids. If you have kids, you expect them to go to college. You can save. Thanks, Mike. Mike just put in $10 for the question. I appreciate that. So anything that's tax-free, take advantage of it. Take advantage of it. Health-saving accounts, ultimately, education-saving accounts, I forget the name of the account that you can set up to save money tax-free for college. But there's a bunch of them. I never used that one because by the time it came about, my kids were much older and it didn't make any sense in terms of saving for their college because they were already quite old. All right. What else? Yeah, so the vehicle in which you save is important. The younger you are, the more you want to take advantage of these, particularly these Roth IRAs, but any form of investment that is not involved, that saves you in taxes. And, okay, so that's savings. But you don't want to just have it in cash sitting there because, of course, cash loses value every year because of inflation. And also you lose what's called the opportunity cost of being able to deploy that money for productive means where it grows because it's invested in something that's productive. In other words, invested in something that is actually growing wealth, growing value. So you want to have an investment strategy. You want to be able to invest the money in ways that earn you some kind of return over the long run so that you can plan for that retirement, right? So that when you retire, you have the money. And, okay, so here's my view of retirements investing, investing for retirement. The younger you are, the more volatility ups and downs you should be able to tolerate, right? Over the very long run, at least historically, and we'll get to the future in a minute. You know, the stock market has done very, very well over the long run. And if you just have the patience to stick with it, you've done very, very well. You can earn 8 to 12% annualized return on average over very long periods of time with the right kind of portfolio. So what I recommend people do is particularly when they're young, they buy only stocks, but they don't buy individual name stock. They buy mutual funds, ETFs, that are well diversified and that are cheap. You don't want to be paying somebody to invest your money. You want to make it cheap. Vanguard mutual funds are pretty cheap. ETFs generally are fairly cheap. You want to look and find ones that are fairly cheap and who funds that have run well. And what I would do is I would widely diversify across different stocks categories. You know, so for example, tech stocks are pretty aggressive. They go up a lot, but they can also go down a lot. And I know people don't believe me that can go down because tech stocks seem to only go up. But if you look at tech stocks in the 1980s and 90s, they seem to only go up. Certainly in the 90s, post-89 crash, they only went up and they go up and up and up and up and up and up. And it seems like, wow, this is amazing. I should put all my money in tech stocks. And then one day they crash. And they crash by a lot. I think the NASDAQ went down from peak to bottom by something like 75%. You lost 75 cents on every dollar you invested. And you might say, but if you hold it long term, it depends what your long term is. Because it took the NASDAQ, I can't remember the exact number, but I think something like 12 to 13 years to get back to its height in March of 2000. And since then, it's been on a tear. And you've made a lot of money if you're in tech stocks. But what happens when it goes down 75% next time? And how do you know when you will need the money? Will you need the money when it's at the bottom, at the top, in the middle? So why you want some percentage of your portfolio in stocks that could go, boom, do that. And who on a very, very long run make a lot of money. I mean, it makes sense that tech would make you a lot of money. That's where the growth is. That's where progress is. You don't want a certain percentage of your savings to be in that. You don't want everything in there. And generally, what I recommend, what financial theory recommends, is that most people have a well-diversified portfolio. Some in very aggressive growth tech stocks, some in what are called value stocks. These are stocks that are relatively value. They are cheap or inexpensive across all industries. You also want maybe some investment in real estate, which you can do through the stock market with a variety of instruments. You can also buy a diversified portfolio of real estate assets. And you want to be in a, basically, you want to bet. If you're going to bet on anything, hopefully, you will bet is the wrong world. You want to invest in the world economy. Now, if you know something, if you have particular knowledge of a particular field and you know and are convinced that a particular area will do well, fine, invest a little bit more in that area. But take into account that you might not know what you're doing and you might make a mistake and take on as much, you know, think about how much risk you will need to take on. So, diversification, diversify widely. Here's what I don't recommend you do for short-term savings, long-term savings, medium-time savings. I don't recommend any one-day trade. I don't recommend any one-day trade. I don't believe in buying the dips. I don't believe in buying any kind of one of these crazy rules of thumb. Every time you trade in the stock market or the bond market, you're trading against professionals who do this for a living. You're trading against, on the other side of the transaction, there's always somebody on the other side, people who do this for a living, people who are good at it because they've survived, people who get paid a lot of money to do it, people who are well-trained in it. So, don't pretend like you know more than they do. Now, you might want to take a little bit of money, insignificant for your total wealth, put it aside and, as plain money, and for the enjoyment of it, trade on a daily basis. Sometimes you'll make a lot of money and you'll tell your friends how amazing it is and sometimes you'll lose a lot of money and you won't tell anybody that you lost the money. The only stories we ever hear from day traders about all the money they made, never about the money they lose. So, just, you know, be objective about what you're making and what you're losing and never devote, never take all your money and day trade on it any more than you would do it in gambling. Most, I'd say 99% of day traders are gamblers. There are a few that are not that actually know what they're doing. Maybe they have an algorithm, maybe they've figured out something, maybe they're just exceptionally smart, maybe they know a particular industry inside out but most people have no clue and most people are just the next dumb guy who, you know, was it the fool that was born so that other traders can not take advantage of him but do take advantage of him. So diversify, diversify, diversify. Don't pretend that you're a finance guru when you don't know anything about finance. Be objective about what you actually, actually know. There's a concept. Be objective about what you know. Pretty crucial, pretty important. Do it. I think that covers it. I mean, the key to personal finance is to keep track, have clear goals, know what you're saving for, know how much risk you will need to take on. Don't pretend you know stuff you don't know and really think about what your earning potential is. Try to maximize it within the context of your life and plan according to that earnings potential. Don't short-shift it, but don't exaggerate it and then really think about how much do you need to consume to live well and how much you can afford to put aside to save short-run, medium-term and long-run and have an investment strategy for the short-run. I'd say mostly saving accounts and cash. Medium-term, a big chunk in saving accounts and cash and only some in speculative assets like stocks. And long-run, if you're young, mostly in stocks. If you're older, mostly in stocks, some in, let's say, saving accounts are bonds. If you're very old, almost all of it is some form of liquid securities, either bonds or short-term bonds, not long-term bonds, because interest rates can go up as we've discovered and other kind of short-term money-type instruments. You're not going to make a lot of money on interest payments and that's fine. Now, let me just address this issue. What if you're super pessimistic about the world in the future? Well, one, make sure that that pessimism has some basis in reality because the fact is that everybody seems to be pessimistic every decade about future decades and usually future decades are better than the decades we have right now and usually, you know, the stock market goes up. So make sure you're being objective about your fears about the future. And, you know, if you are afraid, then you should, you know, what you want is to be in cash, a gold, I'm not sure Bitcoin is a good hedge against the end of the world, but gold certainly is. You know, yeah, load up on more gold. You know, it's not bad in a diversified portfolio to have a certain percentage of your net worth in gold. I don't know, 10% maybe. I'm not making any specific advice, but just kind of generalized. What else? So gold, we talked about a little bit and yeah, what happens if somebody asked somebody said here, yeah, what about positive things? Like, I don't know, should we be investing in Argentina right now? Well, yeah, if Mila is going to be successful, but do you know if Mila is going to be successful or not? Do you know better than the market if Mila is going to be successful or not? Because the market's already up quite a bit in Argentina with expectation Mila will be somewhat successful, but there's a probability on it. The market has estimated what their probabilities is. Stocks have gone up, but not as much as if he's truly successful, but also more than if he's failed. So are you willing to take the risk that this won't be successful by buying Argentinian stocks? That is, yeah, I mean, it's like tech stocks. How positive are you about the future and how much do you want to allocate for that? But if you want to have a little pool of money that you say, I'm going to invest based on my estimation of what the future will bring. And in this case, I think Mila is going to be successful. So I'm going to put a little bit of money into Argentina. Go for it. I think that's good. I mean, I'm considering doing that. I might do it after I visit Argentina and get a better sense of what the upside really is. But yeah, I like also the idea of investing in something you believe in, right? Investing in stuff that you really like. I mean, the same about individual stocks. You might be a fan of Apple and you want to own some Apple. Sure. Why not? Just don't make it a big chunk of your portfolio because Apple could come up with a horrible product and something disastrous could happen and you don't want to be wiped out. If you work for a company that gives you shares, so a chunk of your compensation is stock in the company. Don't hold it forever. Certain percentage keep in the company. But look, you're already undiversified because your salary is coming from this company. Diversify, sell some of it and put it into other stocks. Put it into other places. All right. Let's see questions you have because I think that we'll see what direction that takes us on. We're still way short of our goal. We'd be going for over an hour, so it'd be great if we could make up this difference. Those of you haven't asked any questions, please consider doing so. If you are going to ask a question since we've got a lot of them, see if you can make it a $20 plus question so we can start chipping away at the goal without keeping us here for lots of hours. All right. Sivanos, 50 bucks. Sivanos says, being hard to catch your shows lately, glad to be here. Glad you made it, Sivanos. I hope you're still there. I don't know if you are, but I hope you enjoyed the show. Another $50 from Enric. We'll watch later when I'm free. My question is, advice to deploy your money towards your goals when you're semi-retired. Make a list of what you want to accomplish and the money you have towards that. More advice than that. Thanks. Well, I mean, you want to make a list, but then you want to have a, you want to figure out the timeframe for each one of those goals, right? So every one of those goals, I want to take a trip around the world. I want to be able to fully retire and live off the income from my savings. I want to, you know, I don't know, I want to downsize the house and move into a condo that might be cheaper, might be more expensive or whatever. I want to have all these goals lined up and I want to think about how much money I want to allocate for each one of those. How much money do I have right now? And again, I would take the strategy of short-term, medium-term, long-term. Now, here, short-term, medium-term, long-term are going to be different scales because your income is reduced, but also just you're going to live a lot less, right? If you're in your 60s, suddenly your time horizon is only 30 years into the future, probably. So here you want to say, okay, here's an amount of money I have to, you know, look, I need to eat. I need to pay for housing. I need to, this is the basic stuff that I need. This money is allocated towards that. I'm putting it in this pool. I'm going to invest it. I'm going to put it in some combination of stocks and bonds. And in real estate, I'm going to widely diversify it. And this is my pool for survival, for living, for living at the base, at the way I want to live, not living in a hut somewhere, but this is a pool dedicated for living the way I want to live. And I'm going to invest a very diversified, and I'm going to put that aside, and I'm not touching that because that's my living money, right? And then, all right, I've done that, and there's some money left, and now some of this money, and I do have some income coming in, so I'm taking that into account, and I might downsize my home, and I'm taking that into account, so I might get some inflow from there, and I might inherit some money or whatever. Take all these things into account, but here's another part of money. This money, I want to have some medium-term and short-term goals. I want to travel, I want to do X, Y, Z. So I'm going to allocate a certain amount of this money for travel, and I'm going to invest it. And depending on how important the travel is to me and how important the timing of this travel happened, I will decide how risky I'm willing to be on this. If you know what, if I don't travel, it's no big deal, and maybe I'm not putting too much, I'm not putting a lot of money here, but it would be cool if this money grew dramatically that I could travel really, really well. Maybe you want to be a little bit more aggressive with the savings. On the other hand, I know I want to go on a trip to Italy next year. I'm going to go for two months. It's going to cost me this amount. I'm not going to have any income during those two months. How much do I need? Okay, I'm going to allocate that. I'm going to put it away in a saving account because I don't want to risk it at all. It's going to grow right now. It could probably get a 4%, 4%, 5% on your saving accounts. It's going to grow this amount. Great. I've got that money allocated. I haven't touched my consumption money. This is money allocated for the trip to Italy, and it's done. And you've got to divide things up according to those goals and have pools for each one. And think about how to invest each pool a little differently because the time horizon is different. The risk is different. The more risky, the more you go towards stocks. The more safe, the more you go towards cash. With, I don't know, tech stock being the most risky or Bitcoin being the most risky. All the way to cash being the least risky with growth stocks being risky. Value stocks being a little risk risky. Bonds, depending on interest rates being more or less risky. Short-term bonds being less risky. And, of course, cash being the least risky. Or saving accounts. Cash, when I mean cash, it means it could be a saving account, right? It could be a saving account. So I don't know how much more specificity you want for that, but hopefully that answers the question. But if not, we can do a follow-up in a different show. Iron Makeup says, my investment advice by Argentinian real estate, all the Russian war criminals will make the price rise. Plus, you can rent it out to the Ukrainian Mossad. Furthermore, I think Gaza must be destroyed. I have no idea whether Argentinian real estate is a good investment or not. It's cheap or not. I'm not sure why Russian war criminals will go into Argentina. There are lots of other places that they might want to go to. The money is in Malta and a variety of different places that have Cyprus that have taken in Russian money, same with Ukrainian Mossad. I don't know who the Ukrainian Mossad is. I think Iron Makeup is kidding. But be aware. We're aware of fancy stories. Anything that appears too good to be true almost always is too good to be true. As older you get, and you're starting to think, okay, maybe my judgment is off a little bit. I mean, people will get older, particularly into the 80s, lose a little bit of a sense of judgment. Some people never have it, but some people lose it with time. Then find somebody you trust who has a good financial mind and anytime you're tempted to do something crazy with your money, ask that person. This is what friends are for. This is why having great friends is good. It's a certain sense of protection. You can rely on them. You can call them up. Hey, I've just been offered this bridge in the middle of the Atlantic Ocean. Should I buy it or not? It seems like a really good deal. Yeah, you should have friends that give you advice. I've been asked many times, I was asked many times over the years about all kinds of investment schemes. Often people did not take my advice, and usually they suffer the consequences and regretted it later. Schemes that seem to offer very high returns with very little risk don't exist. It's not such a thing. Friend, hop up. I think there is an emotion that follows from recognizing that one has more than one needs. I call it wealthy. This emotion is dependent on individual context and can change based on ambition. Yeah, absolutely. And look, knowing you have more than you need, but your needs change, right? My needs are very different today than they were 40 years ago. I spent a lot, lot, lot less money 40 years ago than I do today. I was happy then, I'm happy now. I had just different needs, different expectations, lived in a different home, had a different mortgage, had different toys, different expectations and were comfortable in terms of a lot of things. So this will change with your life and expect it to change and acknowledge that it's going to change. Don't be dogmatic about it. Your needs should grow as you have more money and as you get older and those two should go together. You should be making more money as you grow older. I mean, up until retirement, you should be an upward trajectory in terms of your career, in terms of your earning power, in terms of your ability to earn money. That's what having a career means. It means more every year. Well, I mean, every decade, whatever, doesn't have to be literally every single year. So if that's not the case, then you should really think about your career. You should really think about are you ambitious enough? Are you investing enough in yourself? Are you investing enough in your career? Are you investing enough in getting that upward trajectory which should last you a lifetime, really? Giffrey says, this is invaluable. Thanks, Iran. So far, it's only $398 of value. So invaluable, I don't know. And also, it is interesting, I thought that this is a topic I'd get a lot of people watching live and asking questions. Now, maybe it's not a convenient time, but I am surprised that, you know, again, if I talk about politics, I get a lot more people watching live. It's just interesting. I think a lot of people watch the show after the fact, but the advantage of live is, of course, you can ask questions. Thank you, Jeffrey Giffrey, for the support. Really appreciate it. Have I gotten all the people's stickers? No. Mike, did the sticker, I think I mentioned that because he asked a question in the chat. Kenny, did a sticker. Thank you, Kenny. Yeah, that's as far as I can go back. So, yeah, again, feel free to ask questions. $20 questions have a huge, a advantage. All right. It gets closer to our goal. Andy says, have you seen Lex's debate on Israel with destiny? Everything is Zionism or Arab. Nothing is how can I live here and there? What are my rights? It's all Arab state or Jewish state. Yes, I know. I haven't seen it yet. On Thursday, this coming Thursday, I will be talking to Ilan Juno about the debate. So we're going to take the debate apart. We'll analyze it. We'll think about it. We'll critique it. And we'll present our views basically on certain questions that are being asked. So, you know, I didn't have our expectations for the debate because, you know, particularly the pro-Israel site, I thought was very, very, very weak. I don't like Benny Morris and I don't like destiny in terms of their knowledge. Benny Morris is a, he was one of the new historic, new historians school. He later changed his mind, but when he was a new historian, he basically applied principles of postmodernism anyway. Anyway, we'll talk about that on Thursday. We'll talk a lot about that on Thursday in terms of why I don't like the new historian school of thought anyway. And, all right. So, Andy, watch the show on Thursday. Sylvanos, what can be said for using minimalism to augment your finances? I don't know what minimalism means. You mean really cutting down your expenditure, living the bare minimum so you can save a lot of money. I'll take that as what it means and if you want in the chat to correct me, that's fine. I'm very much against that. There's something wrong with your planning horizon, with your production, with your ability to earn money if that's what you need in order to save money. Life is for living. Life is not for living tomorrow. Life is not for living 30 years from now. Life's for living now. You've got to live at a reasonable level. You've got to live at a level that you can enjoy life, that you can be satisfied, that you can flourish, that you can do the things that you enjoy doing that are necessary for you. Now, that'll change over time and it has to be within your means. But the purposefully, I mean, starve yourself so that one day you'll have more money. Well, instead of that, think entrepreneurially, think about how you can produce more money, think about how to grow your earnings so that one day you have more money. Instead of shrinking your consumption side, think about growing your earnings side and invest in growing your earnings side. It reminds me of this longevity strategy. You know, there's a strategy to live long. They found that if you restrict your calories significantly, you probably, at least with mice this works, will live longer. But you will have no energy and you will never be satiated and you will never enjoy food and you will never have, I mean, forget it. I hate feeling hungry. I hate it when I have no energy. I want to enjoy my food. I want to enjoy my life. I'm just adding a year of my life for the sake of adding a year of my life that is not enjoyable, that is not a year that I can use for human flourishing is pathetic. And that goes for finances. So I would not do calorie restrictions and the same goes for finances. I would not do money restrictions in order to one day. Instead, grow your productive capacity. Grow the amount of income you get. So that you can live a better life longer term. So that you can save that money without sacrificing your short term consumption. You want to be able to live reasonably well. It's one of the reasons you should invest in yourself early on so that you can get a good career that makes decent money. Hopefully you should enjoy it as well. Not hopefully, but you should enjoy it. And think about how you can be entrepreneurial to make more. Jennifer, can you discuss the phenomena where some old people get really cheap? Maybe it can be caused by dementia. My one uncle used to say they are waiting to take it with them after death. I mean, there are all kinds of psychological reasons that go on there. Some of it is fear because they don't know how long they're going to live and they're not sure they'll have enough. Some of it is this altruistic, I think it's altruistic in the end, commitment to leave their kids money. It's a, you know, for some people, I know quite a few people like this, it's an issue of kind of some kind of personal pride that they get to die with a lot of money that their kids can have. I think that's a completely wrong way to look at it. And then some of it could be a sort of dementia. Yes, but I think a lot of it is, they become, I think older people, as you get older, again, not everybody, but I've noticed this with older people, they become more fearful, more worried about the future, more cautious about the future, more risk-averse, and therefore less inclined to spend money because what if it runs out? What if the market collapses? What if the economy, you know, they tend to buy more gold and tend to put it into the ground? Even though, you know, the time horizon is shorter, the opportunities for the world collapsing is less, right? So it's a combination of fear that I think a lot of people suffer from as they get older, a combination of wanting to leave it to the kids and wanting to, and yeah, again, the fear of feeling like the money is running out. I think that's what causes it. The reason to save money for retirement is so you can enjoy your retirement. Now, you know, it's reasonable to think about saving, leaving some money for your kids, but, you know, I'm planning to live into my 90s. At that point, my kids will be in the 60s, 70s. I hope they don't need my money, right? I mean, I hope they live productive careers in which they've saved money and they have money, and they don't need my money. So who am I saving it for? My grandkids, I hope they have productive careers. So, I mean, this idea that you have to leave your money a lot, your kids a lot of money, I mean, it's fine to leave them some, but you've got to live well. That's your focus. Your focus should be on living well. Andrew, no central planner can decide values because values are individualized. Yes, and yes. But even if central planner could accurately determine values, it is morally wrong to rob the individual of the choice to decide for himself. Yes, and you know, it changes mind and shifting values over time and make decisions about how valuable a value is, right? How much I'm willing to pay for this value. How valuable is the value to me right now? It might not be valuable. It might be more valuable to me in the future or less valuable to me in the future, all kinds of stuff like that. So there are multiple considerations which the central planner cannot assess and should not assess because he's denying the individual the ability to choose for himself and to make decisions and to change over time. Whoops. Ali, it's taken me a long time to get to a question. I don't even know if you're still here. You're not on the chat, so I don't know if you're still here. But here's the question. You're on. I got out of a divorce one year ago, lost most of my savings to keep the house. I'm in late 30s. Do I still have any chance? Any chance for what? Of course you have a chance. I mean, you're in your late 30s. You're in the beginning of life. As I said, first time I ever owned a house, I was 30, what was this? It was 34 before I owned my first house. I had no money to put down on it, so I got it with zero down. I borrowed every last cent to buy the house. I was at the time, or a little bit after that, I had huge credit card debts because I had started a business that had failed. So I basically was carrying $50,000 of credit card debt. Now, I used zero interest rate, zero balance transfer credit cards for years, transferring that debt from credit card to credit card to credit card, so that I wouldn't have to pay any interest on it because I couldn't pay it off yet. I didn't start saving for a time in until my late 30s. I didn't start making real money. I don't know what real money is. I don't know, well into the six-figure money until my late 30s. So absolutely not. You're still young. You can still save. You can still enjoy consumption. You can still live well. I don't know what career you have, so it depends on your profession. But you strike me as a pretty intelligent guy. We don't always agree, so that's a knock against you. Now, I'm kidding. But you strike me as an intelligent guy. You probably have a decent career. You probably have a well-paying job. If you don't, then you should find one. And I don't know how entrepreneurial you are. I don't know how much you're striving to be entrepreneurial, but you should constantly be thinking about how to maximize your potential income. Being in your late 30s gives you a huge amount of time to do that. You're basically going to be productive well into your 60s, maybe well into your 70s, depending on your career, depending on your interests. You've got a ton of time. I mean, this idea, I mean, I know people, a friend of mine, I mean, I have friends that didn't figure out what their productive career was until their 30s, and had nothing until their 30s. And they had kids, and, you know, and I don't know if you have kids from the previous marriage, but they had kids, and they've done phenomenally well. So there's no limitation. The real cap is your productive ability, your productive ambition, your willingness to invest in your own productivity. So no, don't give up, don't get into that mental thinking it's too late or anything like that. I think that is the most destructive thing is to start thinking of yourself as, I mean, my late 30s is too late for me. I mean, that's ridiculous. Really ridiculous. Because you're super young, and there's so much of life in front of you. And that mental attitude is really, really destructive. All right, Mike. Duty says $50. Thank you, Mike. Really, really appreciate it. He says, thanks for everything you do. This donation is long overdue. Really appreciate it. Thank you. Thank you. All right. Let's see. All right, we're chipping away. We're chipping away. This is good. This show is funded from support from you guys. So keep it up. I really, really appreciate it, and this is my income. This is my income in my retirement. I'm not retired, but in this period of my life, my income is this show, basically, and my speaking. That's it. So I appreciate whatever you do. Let's see. All right. We have Richard. Richard is asking, I have an idea of buying growth stocks on margin, mitigating the risk with stop loss orders. The stop price would increase at least as much as the margin rates. What do you think? Stock price would increase. Why would it increase at least as much as the margin rate? It might. It might not. Look, I think that you're taking on a lot of risk. So it's good that you're putting in stop loss orders, but the stop loss orders are going to be a loss. You could lose money. You might make money for a while. I've seen people then stop putting on the stop loss orders because they want to buy the dips. They don't want to get out of the dips and losing a lot of money as a consequence. I've seen a lot of damaging, a lot of things that... But look, buying growth stocks on margin is buying growth stocks with debt. You're basically getting debt to buy this. So while you can cap how much it goes down, even if it goes down just that amount with the stop loss, you're going to lose not only the stock that you bought and the debt, right? So it could be very painful. I mean, run the numbers. Put it in a spreadsheet. Put it in a spreadsheet. It's not that hard to do. Put it in numbers and play it out based on different assumptions of how the market would do. Figure out what your stop loss is. Let's say it's a 10% loss. How much would you lose? If you're on margin, you're not just going to lose 10% because it's leverage. Leverage allows you to make a lot of money on the way up, but it also makes you lose a lot of money on the way down. Mortgage is margin. So if you buy a house with 20% down, that means that you bought it on... Richard said growth would eventually cover the cumulative interest. Eventually it would, but you could really suffer a downturn that could wipe you out in the meantime. So what's your tolerance for the pain involved? If it was risk-free, if it was low risk, then everybody would do it. So what you're doing is a super hyped-up, risky strategy that could pay off enormously and it could wipe you out or could maybe not wipe you out, but you could suffer significant losses on. That's what risk means. It means you could suffer significant losses on it. And the more you try to mitigate the risk, the more you try to mitigate the risk, the more, the less upside you're going to get. So you have a high risk tolerance, but you want to apply your risk tolerance to things that you have a comparative advantage at. And there's no comparative advantage in buying growth stocks on margin. I knew a guy who bought... There was this thing in the 1990s. You could buy a, basically a kind of a mutual fund, a kind of an ETF. There was highly-leveraged growth stocks. Highly-leveraged growth stocks. Like the leverage was 4 to 1 or something like that. And it was thousands of percent. It was just going up like this because stock growth was doing well. And then in March and April and May of 2000, he basically was wiped out. So what's the point? Think about ways in which you can take risk that are... where you're mitigating the risk with your own talent, in a sense. So you're taking risk on something that you have control over. Starting your own business is a good example of something like that. Or investing in particular stocks where you might have some comparative advantage in terms of your knowledge of them. But just, you know, margining up on the market, you know, you're not bringing anything to the table. And by not bringing anything to the table, just leverage, you're setting yourself up to fail. I don't think I know anybody who's used that strategy over the long run who's made money. So I say beware if you have a high risk tolerance, think about how to utilize your risk tolerance in a way that will maximize your potential return. And that means using it for something you know a lot about or you're an expert in. Why isn't this working? I'm doing something on here in my program and it won't work. That's bizarre. Try it over again. All right, giving up. MetaLife says thoughts on whole life insurance hate it very, very, very, very much against whole life insurance. I know people do this all the time. Nobody pays attention, I guess, but it really doesn't make any sense. Here's what whole life insurance is. Whole life insurance is a combination of life insurance and an annuity or an investment strategy. What I suggest is, what I suggest is, let me just address Richard's thing, RDF said margin calls will wipe you out. Frank says yes, this was 1929. No, margin calls would have wiped you out in 1989. Was it October? October 19, 1989, something like that. Black Monday would have wiped you out in 2000 when the Nasdaq took a beating in March of 2000. Would have wiped you out very quickly in COVID in March of 2020. Would have wiped you out during the financial crisis. I mean markets are very volatile and I'd say the more status they become, the more volatile they become. We're heading into more volatility, not less volatility, beware. All right, back to whole life insurance. Whole life insurance is a combination of an annuity slash investment strategy and a life insurance policy. And they charge you money for both and they charge you a premium for bundling them together. You are better off by splitting them apart. Buying what's called a term life insurance policy. A term life insurance policy, you generally, particularly if you're young, your premiums are going to be very low. But if you don't die during the term of the life insurance, you never see any money in return. I love that. It's real insurance. It's like auto insurance. You pay every month. You never have an accident. You don't see the money. You're happy. Generally, you should be happy when you don't get your insurance money back because it means the bad thing you were doing against never happened. So if you're in your 30s by 30 year term life insurance, you can get it at a very low cost. It'll cover you well into your 60s. Hopefully by your 60s you'll have saved enough money so you don't need life insurance. And you will pay, as I said, very small monthly payments. And I would only do it if there are people you want to leave the money to, wife, children, things like that. Don't buy term life insurance if you don't have anybody to leave the money to. And it's cheap. And then if you want an annuity or if you want to save money, you save money. Buy ETFs, buy a bunch of diversified portfolio, which is much, much cheaper than it would be in a whole life insurance product. And that's it. You're done. And you'll save a lot of money from a whole life policy, which is going to be quite expensive for what you get. Quite expensive for what you get. Thank you, MetaLife. All right, before we go on quickly, let me, and we got a lot of questions, but thank you, which again, chipping away, somebody wants to come in with $150, that'd be great, but no more under $20 questions. It's just too many questions and we're already almost at two hours. So this, I just want to remind you that Iron Man Institute is a sponsor of this show. And I just want to, they're pitching a particular thing right now, which is, you know, the institute is inviting students of Objectivism to join the Iron Man University. Iron Man University instructor, Don Watkins, for an upcoming webinar where he'll discuss five mistakes even long-term Objectivists make and how you can avoid making them. So five mistakes long-term Objectivists make and you can avoid making them. He'll be doing the webinar on this. The webinar is going to take place Tuesday, March 19th between 1.00 and 2.00 p.m. Eastern Time. Tuesday, March 19th between 1.00 and 2.00 Eastern Time. Learn how to mine Iron Man's works for new insights, the most neglected aspects of leveraging Objectivism for happiness, and much more. You'll also have the opportunity to take advantage of a very special offer to study with leading experts on Iron Man's philosophy, including Harry Binswain and Tara Smith, Gina Gaulin at the Iron Man University. To learn more or to register, go to where you always go from here. That is ironman.org, ironman.org, slash, start here, ironman.org, slash, start here. Don is amazing. Go and check it out. You don't have to register, but go to this website, check it out, see, and yeah, sign up. And if you're going to sign up, sign up through ironman.org, slash, start here to show that way they can keep track that you came from your Unbrook show. And they'll keep sponsoring it because they get value from it. So please, please do that, right? All right, Daniel says, I have it set up. So 30% of my paycheck goes into a company, a company's 401k. I work in California, so it reduces my tax rate to about 18%. Then $500 a month goes into a personal Roth IRA. Is this overkill? I want to eventually pay off my home. So, I mean, a few things to consider then. I don't know because I don't know how much you make. I don't know how much you consume. I don't know how well you live, right? I don't know. It will be too much if you're skimping on important things that would allow you to flourish and be successful and happy in your life and you're skimping in order to make another payment into your 401k or into the Roth IRA. But it could be that it's not. Now, 401ks are usually capped, so you can't put more than an X amount of dollars into your 401k. I assume that by putting in 30% of your paycheck, you're maxing out. I'm assuming that your employer is matching at least a portion of that, which is good. And a Roth IRA is always good. It's always good to do. And lowering your tax rate is excellent. So, again, can't tell if it's overkill or not. That would depend on, again, your consumption behavior and how much you're left. How much your disposable income is. Does that allow you to save money for short-term things that you want to buy? And does it allow you enough to consume at the level that you want to consume? And then finally, I'd say I don't understand this idea of eventually paying off your home. I don't want to ever pay off my home. What for? If I can borrow money from the bank and deduct it from my taxes, then why would I ever want to not do that? I mean, it's really, really cheap money. So, it's not clear to me why anybody would ever want to pay off their home. I love having a mortgage. Now, my mortgage is so large that I can't deduct all of it. But I deduct a big chunk of it from my taxes. It saves me money. Now, in Puerto Rico less so, but generally, it saves you money and it's a good thing. Why would you give that up? Now, if they do away with the tax deductibility of your mortgage interest, then it's a whole different story. But even then, if the debt is cheap and you can invest the money for more, I'm not big on, now again, you have to be comfortable with living with debt. But why are you not comfortable with living with debt? As long as you have a plan, as long as you have savings, as long as you've thought it through and it's not going to drive you into bankruptcy. Daniel also says he rents out rooms in his house as well and he gets more income. That's great. But leverage is good. If the house is going up in value and you have a little bit invested in it, you're making a huge return on your money. If you have a lot of equity in it, you're not making a lot of money on this home. Why do you want to, I don't know, constrain your available investable income to a house which might not go up in value? So I'm not big on, I know a lot of people like the idea of paying off their mortgage. I don't see the point. Now, if you're worried about the future, if the one thing you don't want to ever lose is your home, if you don't have enough saved, then sure. But if you've got savings and you can make those monthly payments, mortgage payments easily, then max out the mortgage and get the tax deduction. Now I don't think, I can't remember what the limit on tax addictability is. It's probably a million dollars or something a little above a million. Whatever it is, max out to that, to whatever, wherever you can get the tax deduction. Fenn Halper says, economic power is voluntary interaction. So does that mean the economy is essentially the apparatus of voluntary interaction? Well, if voluntary interaction, at the material level, yes. Definitions I find don't seem to agree with the essential characteristics explicitly. The economy is essentially the place in which we engage in production and trade. And all of that is voluntary. But it's the material aspect of our voluntary interactions. You don't say the economy is where friendship and love, that's also voluntary, but that's not captured by the economy because it's not material. Hopefully that helps, Fenn Halper. Richard says, what are your thoughts on long-term care insurance? I mean, I'm probably positive about it. I don't have any. It depends on how much saving you have and whether you think that saving is enough to pay for that. I've never looked into it. I don't really know that much about it. How much does it cover? Is it going to allow you to be comfortable? Is it like super cheapo that you won't even use it in the end? You'll just use your own money? I just am trying to save enough money so I don't need that kind of insurance. And at some point here I won't have any life insurance anymore because I think my savings are high enough so that if something happens to me, my wife can live off my savings for long enough. So you really have to take all that into account. And I would want to look very carefully at the small print and make sure the long-term care insurance is actually providing the kind of care that you would actually want. It depends if you have kids that don't have kids, if the kids are going to help take care of you or not. I don't think you should count on that ever, but there's just a lot of considerations that I'm just not familiar with, partially because I haven't looked into it myself. Sylvanos, another $50. Thank you, Sylvanos. And George, George just did a sticker. Thank you. It's his first super chat. So really, really appreciate that. I think there was somebody else here with the first super chat. Yeah, MetaLife. It was his first super chat. $20. Thank you, MetaLife. And there was some other stickers. Yeah, we did the other stickers. Okay, I thank them already. All right, Sylvanos, say the goal is a million dollars. If an individual is more risk-averse, is it better to work on the fear of risk or best return on the low-risk returns? I'm not trying to stand. Let me see if I can make sense of this. If an individual is more risk-averse, is it better to work on the fear of risk or best return on low-risk returns? Oh, I see. I'd say both at the same time, right? You should try to understand your own psychology and figure out why you're risk-averse. And we should all be risk-averse, right? I mean, it depends on how much you're risk-averse, but if you feel like it's too much, why am I so risk-averse? Is it holding me back in other realms of my life? And what kind of work can I do to get rid of it? And at the same time, in your investment strategy, you should accept your risk-aversion because you don't want to suffer because of it. And for as long as you're risk-averse, invest, accept the lower returns, accept the lower returns. And as you work to reduce your risk-aversion, change your investment strategy. So I would say do both, right? Always have your investment portfolio, investment risk consistent with your actual risk-aversion. But if you become less risk-averse, then increase the risk on your investments. Thank you, Sivanus. Matthew says, thank you for the show. Oh, absolutely, thank you. All right, we're really close to the target, guys. And I'm sure some of you must have personal finance questions. I know, my guess is that, you know, you do, but you're not listening live. So those of you who listen live, please consider, we got $76 to get to our goal. So that's like $3.25 questions and we're there. Let's see if we can make it. James says, what is the best way to generate passive income? Well, it's to have a ton of money sitting in a mutual funds, sitting in your investment portfolio, so much that the dividends and the interest that that money is generating, you can live off of. That's what passive income means. It means that you can live off of the interest and the dividends that you're getting off of your investment portfolio. And it's big enough to do that. And depending on how much you consume, that would determine how big of an investment portfolio it would have to be, how rich you have to be, how much money you'd have to have in savings. James says, does Dave Ramsey give garbage advice you can never get ahead with his approach? I don't think he gives garbage advice. I think he gives advice to a certain category of person. I think he's very good for people who can't handle debt, who generally are irresponsible in their lives. And, you know, Dave takes the perspective of I can't control how irresponsible they are. I can't teach them to be more responsible, generally in life. So what I need to do is give them rules. Give them rules that can guide them so that in spite of their irresponsibility in general, in their finances, they'll not do anything too horrific. And, you know, there's a place for that, given how irresponsible and ridiculous people are out there, there is absolutely a place for exactly that, for that attitude of, look, in a sense, you're too irresponsible, too dumb, too out of control to be able to actually manage your own affairs. Just follow the script. Just here's the dogma that you have to follow. At least you won't do harm. So it's on the principle of do no harm or do as little harm as possible. People like that, you know, in many respects are hopeless and that's not what I want to be talking about. I want to be talking to and with people who are responsible but just don't know. People who are responsible but need some pointing in terms of directing them in the right direction in terms of the advice, but not people who need a formula and need, okay, just do this. Because, yeah, I mean Dave Ramsey is dealing with people who don't have ambition or have ambition, don't have the discipline to be rational and not choosing to be consistently rational in a disciplined kind of way. So Dave Ramsey has this place just not talking to the same people I want to talk about, talk to. Wes, thank you, really, really appreciate the support. Wes just did a sticker for 50 bucks. So now we just need one person to do $25 and we're there, or five people to do a $5 sticker each. I mean, there's 76 people watching right now live. If just a few of you did some $5 stickers, we'd be right there and all would be good in the world. Stickers are easy. Frank says, Bank of America put a $7,000 max on my credit card. My rate was 13%, now it's 18%. It always teases on the max limit. Should I pay a lot more per month? So I don't understand, you're actually paying 18% on money you have on this credit card? That's horrible. You should pay down the $7,000 or whatever you have the balance there as quickly as you can. In other words, you're paying 18% interest to the bank. For what? The only reason you would want to pay 18% on debt is if you've got something that's more important, that's more valuable than 18%. 18% is a lot. So, yeah, make much bigger payments every month to get rid of that debt. Drive it down to zero. You should only use credit cards, and here I agree with Dave Ramsey. You should never be in a position where you're paying credit card debt. Credit card debt is unbelievably expensive. Do whatever you can to reduce your consumption to get rid of it or find a way to get other debt. Maybe you can find a bank that'll lend you money at 8%. 18% is insane. So don't do it. Don't do it. Find ways not to do it. Find ways to pay it off or get a cheaper loan, refinances. I mean, yeah, so figure out what to do about it. Your top priority financially should be to get rid of that 18%. Only use credit cards for convenience. Pay the entire balance off every single month. Allow yourself to get into a position where you're paying 13% to 18% debt unless some emergency happens, and then pay it off as quickly as possible. That is just too high. Way too high. My mortgage is at, I don't know, less than 4%. My car loan is at 5%. I can't even imagine paying 10% or 18% on anything. So yeah, make that a priority. Kim says buy some Bitcoin. Buy some Bitcoin then. I'm not. Louis Philip Knowles says, want higher pay, get new skills. Yeah, or get better at your job, become more productive. Jacob says, as someone working in a union plant production does not transfer to pay some of the time, part of the reason unions are partially immoral. I agree. Try to get out of a union job. Try to shift jobs. Try to move out. Try to get to a position where the union is not capping how much you can earn when you are more productive than the people around you. Richard, I'm voting with my money for discussing finance, which does good over politics, which mainly looks good. I get it, but here I am discussing finance, and yeah, we just made it your $20, just got us over the $650 goal, whereas when I talk finance, politics is much easier. It's taking us over two hours to get there. I often get there in an hour and a half talking politics. But look, I'm happy to talk finance. If you guys have questions and if you bring your friends, and you know, there's 77 people watching right now should be doing stickers to just even $1, $2 RDF. Thank you for, Apollo did one. And don't forget to like the show and let's see how many people watch the show afterwards. I have a feeling a lot of people watch it afterwards. So I'm happy to talk finance. Thank you, Richard, for putting your money where your mouth is. And I'm happy to talk finance. Please ask questions about finance. Please, if anybody wants to sponsor a show, it's $1,000 and you get to decide the topic. And, you know, we used to, I'm open to show sponsorships anytime you guys want. Usually we have quite a few during the year sponsorships. Okay, we've got a bunch of questions. Let's do these quickly. We're over two hours. Pickaxing, writing sci-fi with 3D printing house in the background. Housing demand is lowered due to this innovation, requires fewer resources, less labor costs, and far faster to build. Cogent unrealistic. Well, I don't think it will reduce demand. It'll increase supply, which is great. But yeah, I think 3D printing of housing is the future. And we need to build millions and millions and millions of units of housing in the United States. And I think a 3D printed house is the one way in which to get those housing done. We need primarily to get the government to stop regulating. Daniel, if I want to invest in something more risky with a portion on my investment, what might be a good option? I mean, tech, biotech, things like that, things that are exciting. Maybe some companies that you have enjoyed consuming their products or really think that they produce something really, really valuable that you would enjoy owning their stock, things like that. But again, I would do it with a small portion. But yeah, so think about companies you interact with, companies you really enjoy that you think produce a great product or a great service that you would like to own a piece of. I and Mikat want to hear a joke, Russian elections. Who's going to win? Vladimir or Putin? Not funny, but true. Pickaxing, a deep-sea mining company stocked by all while low. At least one will climb in the market in my early 30s and just started as a lab technician. I mean, I wouldn't put a lot of your money into something like that. Deep-sea mining might be the future. It might not be the future. There's a lot of mining to be done on land, which is a lot cheaper. But yeah, by the entire industry, one of them will do well. Maybe the rest will too, hard to tell. If you think that's where it's going to go, but put a small portion of your saving into something like that because it's high risk, high risk. Francisco, what are your thoughts on 2000 market crash? What was the reason? Oh, well, the reason was there was a bubble. You know, there was a bubble by million technology stocks, but also broadly market. I think the bubble was caused by two things. One is by pretty loose monetary policy by the Federal Reserve during the 90s, interest rates, if you will, being lower than they otherwise should be. Same reason, we got bubbles in housing in the 2000s and I think got all kinds of bubbles, including probably in the stock market in the 20s, leading to today. But then it was clearly interest rates lower than they should be. And then on top of that, you also got a investment frenzy and investment passion for tech, which happens every time there's a new big technology when the railroads came in. A lot of capital went into railroads. A lot of people lost their money. The survivors did phenomenally well. So way too much money flowed into technology. Well, too much by some standards. But then at some point there was a cleansing. Some of that capital got lost. But if you'd invested in Amazon, you would have taken a huge beating and then you would have made a huge amount of money over the long run. But how would you know in 1997 that Amazon was going to be the winner? It could have been somebody else. So it is, you know, every technology goes through, every new technology goes through this boom, bust, long-term boom, short-term boom, bust, long-term boom. It's just the way markets function, you know, and the way that you guarantee, not guarantee in a sense, but the way markets provide large amounts of capital for new industries all at once, which creates a bubble in a sense. But you should know that when all this capital is flowing into a particular industry, there'll be a lot of losers. Like right now a lot of capital is flowing into AI. There'll be some winners, huge. There'll be a lot of losers. A lot of companies will go bust. You have to take that into account. And the dot-com bubble was exactly that. And some of it was just pure emotionalism by market participants. I wrote about this in an academic paper. So people get emotional about stocks, meme stock phenomena type of thing. And they go nuts about buying those stocks in the short run. And yeah, and you can get, so you could have stock run-ups that just make no sense because people are being irrational in their buying patterns. Fenn Hopper says, follow up. Do you think Musk or Bezos feel wealthy, as I described before, if they need space more net for Mars missions? Yeah, I mean, I think they feel wealthy. I mean, they're not wanting for anything. They consume everything they want to consume. And they seem to have, they don't think they seem to have a shortage of capital for their space missions. They can raise capital from other sources. They can sell stuff. So it doesn't seem that they're constrained at this point. Maybe, maybe at some point, but just look at how they live. Particularly Bezos lives pretty well. So it doesn't give the impression that, no, no, he's trying to save money so he can invest more in space. And I don't really think, look at, I mean, Elon Musk did one of the great, you know, what do you call it, consumption, whimsical consumptions when he bought Twitter. He's lost a lot of money on Twitter so far. We'll see in the long run whether he makes or loses money. But it was basically, you know, just he wanted it. He bought it, 40-something billion dollars and didn't hurt SpaceX. He could have invested in money in SpaceX instead, but he bought it. He doesn't seem to be holding, you know, a sense of his needs being greater. But they do need to be gazillionaires because otherwise they couldn't do the space stuff and live a good life. Oops, Francisco. How should one think about money when gets from a large inheritance? Should one be living a very decent life materially or the one who's never earned anything? There's a certain guilt to it. No, I don't think this should be guilt. It's not that you didn't earn it. You earned it by, you know, somebody gave it to you. Somebody thought enough of you to give it to you. So you earned it that way. You didn't steal it. But what you don't want it to do is cause you to lose ambition and lose energy around your all-productiveness. So you want to stay productive. You want to engage in productive activities because that's healthy. That's healthy for your self-esteem. That's healthy for your soul. And if the money that is given is going to help you start a business, if it's going to help you consume a little bit more, live a little bit better, that's great. But don't give up on the ambition to be productive. That is the key. If you give up on the ambition to be productive, then the inheritance is damaging and could destroy your self-esteem. So work for the self-esteem, for the pleasure, for the joy, for the challenge that it involves. Ben Shapiro says retirement is stupid, is he right? Well, he's too young to say that. Sure, I mean, you don't want to retire, but the circumstances which you have to, you can't do the work that you've done in the past. You physically can't. You mentally can't. You can't stay sharp enough. You can't physically do the work. You might have to retire some hours. You might have to shorten the amount of hours you work. I'm sure Ben Shapiro will when he reaches a certain age. And there might be a point where you have to stop working, pick up a hobby, go play golf, do something else, or figure out some other productive activity that is not quite as demanding as your primary career. So I think it's a mistake to say, well, retirement is stupid. I think you have to recognize that there are different phases in life and there is a phase in which your primary productive endeavor will probably no longer be available to you, and you'll have to come up with something else. And it might not earn you money. So in that sense, it might be a form of retirement. You should never not do anything. Francisco, why do stocks perform so much better than the average economy? How is this possible? Thanks for the show. Because the S&P 500, or whatever you want to measure stocks, represent in a sense the best of the economy. They represent the best companies in the economy. And in that sense, so the economy broadly has a lot of companies that are mediocre, a lot of companies that are lousy, a lot of companies who are all too many to go bankrupt, and then you have the best companies, the companies that grow the most and they go public and they're the ones you can buy shares in and they grow and they innovate and they prosper. So what you're buying is you're buying the best of the economy and that's why they do better, because they do. And of course, if they don't, they go bankrupt, or if they don't, they drop out of the stock market. So you've got a, in a sense, you've got a survival bias there as well. You're only looking at the ones who survived and have done phenomenally well. So you're looking at the best, the subsection of the best companies in the economy. Silvano says, don't forget to like the show before you leave. Please, don't forget to like the show before you leave. Really appreciate that. It helps with the algorithm, it helps with YouTube, promote the show, any kind of engagement really, really helps. So chat, comment, like, share, all of that stuff is amazing and incredibly helpful. All right, guys, have a great rest of your weekend. And I will see you on Monday. We will have a show Monday, a new show, a news roundup show on Monday. We'll be back to a pretty much regular schedule next week. The new new schedule will only be introduced in the middle of April. But have a great weekend. I hope you enjoyed the show. If you did, like it, share it and all that good stuff. And of course, you can contribute even if you're not live by doing an applause. There's an applause button there. You can do an applause and contribute. You can also contribute monthly at Patreon or you're on bookshow.com. Slash membership. Thanks, everybody. Thanks to Super Chatters. Thanks everybody listening. See you all Monday. Bye.