Should I Drain My 401k to Pay Off My Mortgage? | AMA #2 with Jesse - E86
Personal Finance for Long-Term Investors - The Best Interest
Release Date: 07/31/2024
It’s Not Too Late: Smart Money Moves After 50 | Bill Yount - E105
Personal Finance for Long-Term Investors - The Best Interest
Jesse explores the financial journey of late starters with guest Bill Yount, co-host of Catching Up to FI. In the opening monologue, Jesse shares his “Stupidly Simple Secret Sauce” for personal finance: spend less than you earn, grow income without inflating lifestyle, invest consistently, and prioritize savings. He warns against flashy success stories, consumer culture, and speculation, instead advocating for steady, index-fund investing and disciplined budgeting. The episode also addresses market volatility and debunks the “buy the dip” strategy, showing that long-term consistency...
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Tariffs, Turbulence, and the Harsh Truths We Must Now Face - Bonus Episode
Personal Finance for Long-Term Investors - The Best Interest
Today, Jesse critiques emotional, reactive investing during volatile market conditions—especially in response to tariffs and recession fears—while promoting disciplined, evidence-based strategies. Tariffs, though intended to protect domestic industries, often raise prices and stoke inflation, ultimately harming consumers, businesses, and investor sentiment, with economists warning they may slow growth or trigger stagflation. Market reactions, such as those seen during the Trump-era tariffs, highlight investor uncertainty and the self-inflicted nature of such economic disruptions. Jesse...
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"Tax-Free Retirement" - Smart Strategy or Overhyped Gimmick? And Other Listener Questions | AMA #6 - E104
Personal Finance for Long-Term Investors - The Best Interest
Jesse answers listener questions on financial planning, investment management, and retirement. He discusses the challenges of rising homeowner’s insurance costs in high-risk areas, the differences between Treasuries, CDs, and high-yield savings accounts, and the inefficiencies of using life insurance for tax-free retirement. He advises Casey, a future retiree, on tax-efficient withdrawal strategies and investment choices, and guides Chris, a federal worker, on pension decisions, TSP management, and career changes. Jesse also addresses Rachel’s concerns about bond funds versus individual...
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Life Expectancy, Caregiving Costs, & Retirement Planning | Christine Benz - E103
Personal Finance for Long-Term Investors - The Best Interest
Jesse Cramer speaks with Christine Benz, Director of Personal Finance at Morningstar, about insights from her book How to Retire. Before their discussion, Jesse contrasts gambling with long-term investing, emphasizing the risks of short-term market bets versus the reliability of patient investing. Christine highlights the shift in financial advice toward holistic retirement planning, including the importance of low-cost, diversified portfolios and planning for life transitions. The episode also explores the financial impact of caregiving, particularly on women, and the necessity of proactive...
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The Truth About the U.S. National Debt (And How It Impacts You Personally) - E102
Personal Finance for Long-Term Investors - The Best Interest
Today we take a look at the U.S. national debt, distinguishing it from household debt and analyzing its impact on individuals and investors. Jesse traces the debt’s history and explains its structure, funding through Treasury bonds, and refinancing process. The discussion covers Modern Monetary Theory (MMT), which suggests that as a currency issuer, the U.S. cannot default but must manage inflation through taxation—though critics question the feasibility of this approach. While deficit spending can drive economic growth, excessive money printing may erode investor confidence. Interest...
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Do Long-Term Investors *Need* to Invest in Real Estate? | Chad “Coach” Carson - E101
Personal Finance for Long-Term Investors - The Best Interest
Jesse is joined by Chad Carson, who discusses residential real estate investing as a stable alternative to stocks and bonds. While real estate offers advantages like rental income, property appreciation, and tax benefits, Jesse also highlights challenges such as high costs, tenant issues, liquidity problems, and the time commitment required. Jesse thinks of his Rochester wealth management clients, and what some of them do. Chad emphasizes choosing the right location, focusing on properties with minimal renovation needs, and securing financing that ensures a healthy cash flow. He advises...
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Favorite Moments, Shoutouts, and a Name Change?! …From Our First 100 Episodes - E100
Personal Finance for Long-Term Investors - The Best Interest
Episode 100 of The Best Interest Podcast! This is a celebratory and reflective milestone featuring guest shout-outs, listener-favorite clips, and a discussion on the show's evolution. Jesse shares the podcast's origins, his journey from aerospace engineering to financial planning, and how the podcast nearly faded before finding renewed purpose in 2023. Throughout the episode, Joe Saul Sehy, Brian Feroldi, Paula Pant and other past guests are featured, shouting out The Best Interest and their own work, you’ll certainly want to check out. To celebrate, listeners wrote in with some of...
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Will They Claw Back My Tax Breaks? Should I “Buy, Borrow, and Die?” And More - AMA #5 - E99
Personal Finance for Long-Term Investors - The Best Interest
Time for another AMA with Jesse! First, Randy asks what it means to be rich, leading to an interesting evaluation of personal values, goals, and circumstances. Jesse explores relativity, “keeping up with the Joneses”, and what it means to have “enough”. Then, Bob asks about the potential tax burdens on beneficiaries and heirs, and Tom wonders whether some tax savings are worth the effort of logistical complexity. The fourth question comes from regular listener, Yogi, asking about the role of bonds in diversifying a portfolio. Jesse gets into the details of which bonds are which, which...
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What Do You Mean By “little p purpose”?! | Jordan Grumet - E98
Personal Finance for Long-Term Investors - The Best Interest
Jordan Grumet, AKA Doc G, returns to the podcast to share the difference between “Big P Purpose” and “little p purpose” and why you should pursue the seemingly less significant latter. Bringing together his experience in hospice care and finance, Jordan shines light on how we can create our purpose through personal growth and the pursuit of passions, rather than grandiose goals. Jordan calls these activities that bring joy "purpose anchors," which can be discovered through reflection and exploration. By engaging in these meaningful pursuits, individuals create positive ripple effects,...
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The Bad “Money Scripts” Someone Else Wrote for You | Brad Klontz - E97
Personal Finance for Long-Term Investors - The Best Interest
Jesse kicks today’s show off with a monologue on the importance of having the right temperament for investing - it’s not really about intelligence at all. Emotional stability and disciplined decision making outweigh expertise and intelligence when investing. The Dunning-Kruger effect and the paradox of choice are also highlighted, emphasizing the need to prioritize action over perfection in personal finance. For the second half of the show, Dr. Brad Klontz, Co-Founder of the Financial Psychology Institute and author of Start Thinking Rich, joins to discuss “money scripts”, which are...
info_outlineIn today’s AMA, Jesse delves into various financial dilemmas and strategies to maximize benefits and secure a stable retirement.
The first question comes from Mindy, a 50-year-old widow, weighing the pros and cons of remarrying due to its potential impact on her survivor benefits. Jesse explains the complexities of Social Security spousal and survivor benefits, urging listeners to consult with a Certified Financial Planner to navigate the intricacies and optimize their benefits.
Then, Bob seeks Jesse’s advice on whether to use retirement savings to pay off a mortgage on a new home. With $1.2 million in retirement savings and plans to retire in five to ten years, Jesse takes into consideration some additional context to make some suggestions. Of course, any financial planner or advisor will answer unknown questions with “it depends” - we need to know all of someone’s financial “puzzle pieces” before we can put that puzzle together.
Jesse then addresses Tad's query on compound interest and its application to stocks, bonds, and stock funds, clarifying the concept of "compound growth" in investments and the benefits of reinvesting profits.
Our penultimate question is from Dan, a retiree who shares his bond-avoidant investment strategy, relying on pensions and CDs for market downturns. Jesse discusses the potential risks if Dan passes away, affecting his wife's income, and suggests considering a small bond allocation.
Last up is Amy's question about setting up an annuity from a 401k to create what some might call a “retirement paycheck”, prompting Jesse to caution against high fees and sales tactics associated with annuities, recommending traditional investment portfolios for better returns, flexibility, and liquidity.
If you’d like a question in a future AMA, send Jesse a message!
Key Takeaways:
• Consult a certified financial planner to navigate the complexities of Social Security spousal and survivor benefits, especially when considering remarriage.
• The most common answer to finance questions is “It depends”. It depends on your city, your state, different tax rates, your income, your relationship status, your goals. There is no one size fits all solution.
• Understand that "compound growth" is a more accurate term than "compound interest" for investments like stocks and stock funds, with reinvested profits accelerating growth.
• Bonds can be a useful asset in your investment strategy, but of course, it depends on your goals and life situation. It’s important to consult with a CFP to get a more complete picture.
• Be cautious about setting up an annuity from a 401k due to high fees and sales tactics; traditional investment portfolios often offer better returns, flexibility, and liquidity.
Key Timestamps:
(00:00) - Introduction
(01:49) - Social Security and Survivor Benefits Explained
(09:46) - Financial Planning for Retirement and Mortgages
(19:34) - Understanding Compound Growth vs. Compound Interest
(25:49) - Dan's Retirement Strategy
(27:59) - Evaluating Risks in Retirement
(32:51) - Amy's Annuity Question
(36:29) - Comparing Life Insurance and Annuities
(42:46) - Immediate Fixed Annuities
(47:08) - Conclusion and Final Thoughts
Key Topics Discussed:
The Best Interest, Jesse Cramer, Rochester New York, financial planner, financial advisor, wealth management, retirement planning, tax planning, personal finance, annuities, compound interest, compound growth, death of a spouse, prenup, mortgages, ask me anything
Mentions:
https://bestinterest.blog/valuing-social-security-as-an-asset-in-your-retirement-plan/
https://bestinterest.blog/how-much-life-insurance-do-i-need/
https://open.spotify.com/episode/2NMGr6vYPT4KuCdu9txoce?si=41789317e9614367
More of The Best Interest:
Check out the Best Interest Blog at bestinterest.blog
Contact me at [email protected]
The Best Interest Podcast is a personal podcast meant for educational and entertainment. It should not be taken as financial advice, and is not prescriptive of your financial situation.