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With no hidden fees and a 100% purchase guarantee, you can feel confident when you book your premium LA tickets with Sweet Hop. Visit suitehop.com today. Today on Radical Personal Finance, it's live Q&A. Welcome to Radical Personal Finance, a show dedicated to providing you with the knowledge, skills, insight and encouragement you need to live a rich and meaningful life now, while building a plan for financial freedom in 10 years or less.

My name is Josh Rasheeds, I am your host and today it's Friday and that means live Q&A. Every Friday here at Radical Personal Finance, when I can arrange the appropriate internet connections and phone connections and set up all the stuff, we do live Q&A. If you would like to gain access to one of these Friday Q&A shows, I would invite you to do that by going to patreon.com/radicalpersonalfinance.

Just go to Patreon and search for Radical Personal Finance and if you will do that, you will find the show and you'll be able to sign up to support the show there on Patreon. And that will gain access for you to one of these live Q&A shows. We'd love to have you do that and love to have more and more people on the lines.

We had, it looks like five callers just a moment ago and two have dropped off. So we will go ahead and handle the three that are here. And then today we're actually live streaming. So if you are in the live stream, feel free to go ahead and put comments and questions into the chat box.

And if I have time at the end of the show, I'll be happy to answer a few of the questions from the live stream. Live streaming is fun, but I enjoy it, but it does add a little bit extra, another component, which does make things fun and challenging for me.

Via one man band and a one man producer. I would remind you here before we start that up until March 31, I am currently running a sale on all of my products that are available at radicalpersonalfinance.com/store. If you go to radicalpersonalfinance.com/store and use the coupon code changingplatforms, there at radicalpersonalfinance.com/store, then you will be able to save 50% off on all of my products.

So go to radicalpersonalfinance.com/store before March 31, 2021 and use the coupon code changingplatforms to sign up there. And that'll also give you do it before Monday, because on Monday, if you don't make it onto one of these live Q&A shows, starting on Monday, we are going to be doing a series of extended live Q&A's there where you can talk with me about all the details of your questions.

And with that, we go to Jordan in Kentucky. Jordan, welcome to the show. How can I serve you today, sir? Hey, Joshua, good morning. OK, so my question has to do with health insurance for self-employed individuals. Both my wife and I are both self-employed, both 25, and we're kind of and we both fall off our parents' insurance here in the fall of this year.

So I'm kind of going back and forth between a catastrophic ACA plan that's HSA eligible and max out an HSA versus doing going down the MediShare/Christian Health Care Ministries path, which my understanding is not HSA eligible. And I just wanted to kind of get your thoughts on which one you thought might be better for young, healthy people.

And if there's anything that's that MediShare/Christian Health Care Ministries offers that I guess would make it much more beneficial than the opportunity, you know, outweigh the opportunity to contribute to an HSA plan. So to clarify, you and your wife are young, you're healthy, and as far as you know, right now, there's no reason to expect that you would actually be using any of the benefits from your health insurance.

This is a catastrophic protect us in case something happens in the future plan. Is that right? Yes. OK. How was the how do the costs compare? So I got a quote back in at the end of last year to potentially fall off my my parents insurance early, if it made sense from a tax perspective to put money into an HSA for 2020.

And the quote I got was about five hundred dollars a month with the cheaper Anthem option. The Obamacare or the ACA option that was also quoted was about 750 a month. I've since found I've gone on to health care, duck up and found some cheaper plans that are, you know, not obviously not great plans.

But I saw one for one forty two that was an HSA eligible. And then I'm not really sure how that I've heard some stuff about these MediShare and Christian Health Care Ministries, but I'm not sure the cost per month on those. Well, I would say there are probably three or four major things that you want to look at as you think about making this decision.

So if this is purely from a catastrophic perspective, you first want to look at the premiums, obviously. How do the premiums compare? One of the reasons why many people are attracted to the Christian health care ministries is simply that they're cheaper. There's no question that they can come out to be cheaper depending on which particular one that you use.

And saving money on premiums, especially if you're not going to be using the thing, is certainly often a really good idea. You can't beat having lower cost premiums. So you should think very carefully about the costs of them. The second thing, though, you want to think about is the coverage and the benefits.

And so in some cases, even though you're healthy, you might have some particular thing that you want to be covered. So, for example, with many health insurance plans, things like your well visits, going to the doctor for an annual checkup, those things are covered with the traditional health insurance.

That may not be covered, however, with your Christian health care ministries plan. So you want to look at the actual coverage there. You want to think about the HSA eligibility. So in a traditional health insurance plan that is HSA eligible, you'll be able to open a health savings account and you'll be able to contribute to the health savings account, and that will reduce your taxable burden.

The Christian health care ministries, as far as I'm aware, do not qualify legally for you to be able to open a health savings account. And so if you use one of those services, you won't be able to contribute to the HSA. I think that the final thing that you want to think about is just simply the ethics.

You know, there's no question that they're called Christian health care ministries for a reason. They are Christian organizations. That means that if you're going to join one of those organizations, you need to, first of all, be able to affirm whatever their statement of faith is. There are statements of faith that are very conservative, very Trinitarian, very Protestant.

There are statements of faith and belief that are much broader. I recently was sharing on my Twitter feed about a fairly new ministry organization that simply requires its statement of faith is simply to say that you— what was it? I think that you believe that God made you, right?

So as long as you can say that you believe that God made you, as long as you're not a committed, convicted atheist, then—or I guess agnostic as well—then you would be able to qualify. It wasn't restricted to one certain expression of Christianity. It wasn't even restricted to Christianity. So there have been some changes in that space, but I think that there's no question that that has to play into the case.

That was one of the things that—one of the reasons why I, in the past, participated in Christian health care ministries is that they explicitly exclude certain medical treatments, medical cares that I find ethically questionable. And so that has to be brought into the factor. And I think the final thing is you have to think about the potential for unlimited coverage.

There is no Christian health care ministry—first of all, it's not insurance, so technically you have a slightly more risky plan because it's not health insurance. There's no requirement that if you're involved in a Christian health care ministry, there's no requirement that it cover a medical condition. You're not guaranteed anything.

It's a voluntary group participation. Now, my experience has been good being involved. The experience of most people has been good, so I think that's a minor risk, but it is a risk that you need to think about. And then also I would just say that none of the Christian health care organizations cover you to an unlimited amount.

So the cheapest ACA plan—you go and get an ACA bronze plan—you'll have, you know, may have a $10,000 deductible, but even though you have a $10,000 deductible, you are fully covered with no limit on the top side. So if you have a $28 million medical event, you're covered, whereas that's simply not the case with a Christian health care ministry.

So I think those are the relevant factors to consider. I personally am okay with either way. I think that if you think through those factors and you make your decisions in an informed way, I think either one is adequate. Cool. That's really helpful. I guess one more follow-up, just putting on your CFP hat for just a second, is I saw somewhere that if I'm covered under—like if my parents' health care plan is HSA eligible, I can actually go ahead and open up an HSA prior to going off on my own.

Are you aware that that's a reality? You are a participant on your parents' plan, and so the question is, as a participant on my parents' plan, can I go and contribute—can I open my own separate health savings account and contribute money to it because I'm enrolled in my parents' plan?

Is that right? Correct, yep. I don't know. I don't know. I don't see why you necessarily couldn't, but that's a very technical question. So let me just reason it through for a moment and see if I can come up with an answer. So if you are married and you both are on a plan, could you have individual health savings accounts, I guess would be the first question.

That's a technical thing, and I just don't know. What I would say is my answer—it's going to sound a little bit shady, and the goal is not to be shady, but just simply to say that the truth is, it's one of those things that probably the rule itself may or may not exist, and it's probably never going to be tested.

And so many things in law are like this. So again, this is my guess. I can't prove this. This is simply my guess. There are so many things in law that are just put together that don't make sense, right? So when these laws are created and passed, there's the congressional version, which is oftentimes just riddled with errors and contradictions, and then you'll have the various regulatory agencies that'll come out, and they'll start the process of connecting with another and trying to bring rules to the case.

I don't know if there are rules about what you're saying, but in terms of what would actually happen, well, you would go down to your HSA custodian, and you would say, "Look, here is the certificate of coverage from my HSA-eligible plan," and they would open your HSA for you.

And is someone ever going to come through and audit you and say, "You put $2,000 in your HSA when you were 25, but you weren't legally allowed to do that?" I don't know. You could probably find some technical answer if you call a healthcare lawyer and have them search through all the rules and regulations and see.

I've never seen that addressed. I don't know the answer. What I would say is that if you're a participant in an HSA-eligible plan, I think following the spirit of the law, I would be happy to go ahead and just open an HSA account for myself, even being on my parents' plan.

If some listener can point us to how that's wrong, and I'm corrected by an actual rule, of course I wouldn't. But I think that there's no way to know the direct answer right now. So I would do it, and I would just feel comfortable with my answer. Great. Thanks so much.

Have a great weekend. My pleasure. All right, we go to Andy in Illinois. Welcome to the show. How can I serve you today, sir? Hi, Joshua. I had a couple questions, so I'll ask the easy one first and maybe come back to the others. What are your thoughts on keeping records of things like bank statements and credit card statements and things like that?

In a perfect world, I think it's one of those things that you would say, "Well, this should absolutely be done." You would say, "I absolutely should keep all of these records and keep them for many, many years." That would be the basic point that most people would go for, is to say, "Keep them forever." In a real world, I think they're very rarely needed.

So I think the first answer would be the obvious answer of IRS guidelines on how long to keep things for the purposes of tax deductions. And so there you would follow your seven-year plan, ten years, two years, et cetera, because you need to be able to prove that. If you're not talking about this in a business context, then you could try to come up with a scenario in which you need this stuff.

But I think that it's probably adequate for most people to have just the online records that the bank would have. If I had all the money in the world and it weren't a matter of, you know, I could just hire someone to do it, I would set up a system where my statements were sent automatically to my email.

And I would keep those digital copies in a separate encrypted email inbox or in a separate place. But I think realistically, for the vast majority of us, it just adds so much hassle and complexity, and it's probably not going to be necessary. What I do like to do is I like to segment and separate my assets.

So I think you might have, you know, your working account where you're going to have transactions and there's money coming in, money flowing out, bank records need to be kept. And then you have in a separate place, you have your savings accounts where the bulk of your money is.

And I don't want a lot of transactions on those accounts. I just want an occasional transaction. So the working account, I think that it's probably not worth your keeping all kinds of records because what's going to happen? But on the savings account, I think that that would be one where you could just make sure that those files are kept in case something ever happens to the bulk of your assets.

So, yeah, that's my thought. What I could say is I think that in the past I've spent so much time doing bookkeeping, and I've really decided that it's not worth doing tons and tons of bookkeeping. If it comes down and it causes you to slow down and to have to do your other things, it just messes you up, right?

I think about this with receipts, right? You get receipts, receipts, receipts, receipts, receipts. I can't remember when I've ever actually needed a receipt except for a business deduction. But in terms of an actual problem, I can't remember a time where I've ever actually needed a receipt. So I think just to keep all that stuff, it kind of weighs me down.

And so I've slackened out my record keeping on some of that stuff. That's kind of where I'm at. I feel very burdened by all the paperwork, and I've never ever needed any of it in my whole life. But I feel obligated to keep it. So I was just curious to hear your thoughts.

So I think the simple thing would be use a credit card for your transactions. You have fraud protection, you can look at the transactions, and then just keep your checking accounts and your savings accounts protected where you'll see fraud if it happens. And I think that's probably good enough for the majority of things.

You do need the proof if you wind up trying to take business deductions. So that's one area where the answer is very clear. You definitely need proof for business deductions. Right. Okay, thank you. Alright, my pleasure. And with that, we move to John. John, this is great. I get to talk to you every week.

Welcome back to the show. Thanks Josh. I get to talk to you every week. I think I've missed a handful here and there, but it was mostly an accident. I had a question to say about converting group life insurance. I got a letter since I'd been laid off about the conversion options going to a universal life insurance, which I believe is a whole life product.

I know you did a number of shows on this way back in years past, and I've listened to them all at least two or three times. But I can't remember specifically when it might make sense to take advantage of the group insurance convertibility. And I have currently with them, or at the time of my being laid off, I had basic life and optional life on myself.

And then I had spousal life. What concerns me is one, that they're converting to a whole life product and then just the amounts may not be enough to concern myself with this. That being said, these were basically our only insurances that we did have. So I'm just kind of curious how to think through whether or not I should convert these or just go out in the open market if I ever want insurance again.

I know the biggest benefit here would be not needing additional health exams and stuff like that. And there is a slight concern with my wife's health. She seems like the most healthy person I've ever met, but I forced her to go to the doctor after like 12 years, and it turns out she might have a blood sugar issue.

She doesn't look like someone who would have diabetes, but sometimes it's genetic. They haven't diagnosed her or anything like that, but it's a potential concern. Yeah. I think the answer to this question is very simple. So you have group life insurance. You're leaving the job. Should I convert my group life insurance to personal individual life insurance?

The answer is only if you can't get a better policy in the individual marketplace. So group life insurance, most of the time, it doesn't convert to term life insurance. And you can understand why, right? Because it's term life insurance when you're at the group, but if they let you convert it to term life insurance, they know that they're going to have a risk of adverse selection of sick people who know they got a cancer diagnosis, and they're leaving their work because they got a cancer diagnosis.

That's why they're leaving, and now they're going to convert it to cheap term life insurance with this cancer diagnosis. It just creates a big risk of adverse selection for the insurance company. So that's why they don't allow you to convert to term. They will allow you to convert to whole life insurance.

So the problem with that is that a lot of times the companies that your group life insurance is with, they may not be the kind of companies that do a good job at all with your whole life insurance. And so the only reason why you would take that conversion option is if you knew I can't go in the marketplace and get a better policy of my own.

Either I can't go in the marketplace and buy a term life insurance policy, or I can't go in the marketplace and buy a whole life insurance policy, or whatever you want, you know, universal life, whatever. That's a better deal and a better product than what this company is offering me.

So if there is a sincere health concern for someone in your family, and if they don't have other insurance, then yes, you probably should take the conversion option at least until you can get a better insurance policy. But I wouldn't want that to be the case on a permanent basis.

So the first thing you do is, number one, do an analysis of how much life insurance you need and want. Number two, go and apply for a new life insurance policy. For your wife, go and apply for a new life insurance policy and see what the life insurance underwriters are willing to offer her based upon whatever medical condition she is or isn't going through.

Then once you have a good individual policy, then now you can know, hey, I've got the good individual policy. Even if it's rated, it might still be cheaper than the group policy. So you take what you can get in the open marketplace, and then you go back to the group policy and you drop that one.

And so try as quickly as possible to get a policy in force from an individual basis if you need more life insurance. Now, if you can't get that, you can't -- she's uninsurable. Let's just pretend, all right, something serious is going on. There are changes. That's what life insurance underwriters don't like.

It's not so much that they're worried about any particular condition. They'll actually take lots of conditions that many people think are uninsurable. What they don't like is change. So if they see that she's going to the doctor, they see that something's happening and she's going, you know, all around, that's what makes them nervous.

So in that situation, your strategy is simple. You simply take the insurance that you can get from the group policy, and then as quickly as possible you replace that bad, expensive policy that you had to have with a better individual policy when you can get one in the open market.

Okay. Yeah, that makes sense. And I -- you know, even though she's had some changes, I think she'll outlive me by like 60 years. I don't have any concerns about -- well, I guess the last question I had was since this is converting to a universal life insurance policy, it seems like from reading through the documentation here that the rates are a certain amount per year.

And I guess one of the things I had concerns about a whole life insurance if I was to do it temporarily for say a few months until I found something better was that there are upfront costs with these. But it doesn't seem to be the case with this one since it's a converting policy.

It just seems to be the rate is what the rate is. Now, maybe it won't get -- you know, the cash value of the insurance won't accumulate in the beginning there. But if we're going to have it as a bridge type policy anyways, I don't think we're worried about the long-term cash holdings of it anyways.

So -- but I guess there's just some inefficiencies there in the beginning about using this as a bridge policy. Yeah. In your scenario, if you're using this as a bridge policy, it's actually superior that it's universal life. Do they let you choose the premiums? They have a premium schedule of what they cost, but there were some things you could take on or off like certain other benefits that you could choose to take on or off.

I'm not sure if they let you choose the premiums. It just gives you a quarterly and annual rate based on your age. So I think maybe no. Okay. So let's talk briefly about how universal life insurance actually works because if you keep this always in your mind, then it'll help you to understand where universal life insurance is really good and then where it's bad.

So universal life insurance has three components to it. There is a premium that you pay into the policy. Then there is an investment pot of money. I just think of it as like a big money bag. And then there's a premium cost for a term life insurance policy that gets paid out every single year.

So you put your premiums in, but your premiums that you pay into the universal life insurance policy don't go to pay for the cost of insurance. They go into a separate account, a side account, so to speak. And then in that side account, you have money flowing in from investments.

Sorry, money flowing in from premiums. So your premium money goes into the side account. Then after the money goes into the side account, it gets invested. And so then based upon your investment return, you have a certain size of an investment account. And then every year, the policy, which is a term life insurance policy with increasing premiums, the policy needs a premium payment to pay for the term life insurance.

Now, in the beginning, those premium payments are very, very low. And then they increase according to the normal mortality rates, the normal mortality tables for a universal life insurance policy. So what this means is that in your situation, this is a superior option for you as a bridge policy than a traditional whole life insurance policy.

Because a traditional whole life insurance policy has level premiums required by the policy because the insurance company is guaranteeing the extents of the policy. They're guaranteeing that it's going to stay in force for the person's whole life. So when you switch it around and you look at the cost of the universal life insurance, the actual premium required of you is going to be lower in the beginning, which is going to save you money if you need this as a bridge policy until you can get an individual policy in force.

And so in this situation, you're fortunate that they're allowing you to convert it to a universal life insurance policy because that's actually a better solution for you. Gotcha. Gotcha. Okay, thanks. This is really good information to have and it can help me go through these 20 pages of convertibility.

Great. And I probably will still go back and listen to the old shows as well because I remember there was some really good stuff in there. I wasn't looking at whole life at the time, but I remember understanding the theory of whole life a lot better after listening to those shows.

Good. Thank you. Good. My pleasure. All right, we go to Alan. It says Tbilisi. Are you in Tbilisi right now? Alan mutes himself. Alan, welcome to the show. How can I serve you today, sir? Yeah, sorry about that. Yeah, I am in Tbilisi. Great. Thanks for taking my call.

I just wanted to run some thoughts by you. I think I'm about 95% on making a decision to sell a rental property that we own because of the market right now. But I kind of wanted to just run by my thought process by you and maybe I'm missing something.

But the short story is that the house I bought in 2009 and lived in it for a few years and then turned it into a rental because I'm in the military. I do have the 10-year suspension of the five-year rule. So if I do sell now, I still can come out tax-free.

For a long time, it stayed at basically its basis of what I bought it for. But it's gone up considerably just in the last few months in the current market, which is why I'm considering selling. It could probably sell for $180,000 right now. And I bought it for $140,000.

I owe $38,000 on it. And a while ago, I refinanced it into a 15-year mortgage. So right now, with the renters, it's not quite cash-flowing. So instead of waiting for another four or five years to when I have it paid off and then kind of have a cash-flow asset there, I was thinking about getting out now.

So I can add more to that. But that's kind of where I'm at right now and thinking about selling it. What would you do with the money if you sold it? Well, that's probably a call – another call to you or another question. We have another rental property, but we potentially consider buying something here.

This would give us a good amount of money to invest. Maybe something here or maybe in a different property that would be cash-flowing. Or maybe there's some rental property deals through a kind of investment company that I've been getting into and making pretty good returns. But I also potentially I think would maybe kind of sit and wait for an opportunity.

I wouldn't want to stress to get into anything too quickly. I think the answer here is extremely simple. It all comes down to what would you do with the money if you sold it. So when you're talking about investment, you have a very simple scenario. You say I have this asset.

This asset is creating for me a certain amount of yield. I have income. And then I look at it and I analyze the potential for appreciation. You wouldn't be thinking about selling it if you were making 50% yield on your asset and you couldn't find anything else that was giving you yield.

You wouldn't be thinking of selling it if you thought you know what this house is right in the way of the booming area. And I think this house is going to triple in value in the next three years. You wouldn't be thinking of selling it in those situations, right?

That's correct. So the answer to whether I should sell it or not simply comes down to do I have a better use for the money. And you're the one who decides better use. Yes, you need to consider the tax considerations. You want to look at it and calculate it.

But that's just the cost of doing business. You simply say I could sell it for this amount. This is my market price. And then I have my expenses which my selling expenses which are going to be costs of realtors are going to be taxed. So are going to be any transaction costs, some kind of stamp duties or whatever it is that you have to do.

And so you just subtract those expenses from it and you wind up with the amount of money that you have. You wind up with your profit. And so you take that and you compare it to how much you've invested into it. And you say I either have a profit or I have a loss.

But whether I should sell this investment or not sell this investment is simply based upon do I have a better place to put the money. Now a better place to put the money might be in a bank account. Why? Well, because you say I think the rental market is going to decrease.

If the rental market decreases then I'm going to be in a situation where what I need to do is go and just wait. And then I'm going to be able to come in and buy this same house again at 50% of the value or 50% of the cost that it's selling for today.

Or I'm going to go and I'm going to redeploy this money into the market in Georgia into a Tbilisi house instead of the house that I have right now because I think it has more potential. So it would be totally fine to say this investment has returned enough and I'm going to put the money in savings for a year and then invest it.

But you're still following that same basic logic that I have a better use for the money. And at the end of the day this is the logic that should govern and does govern any decision that you make with an investment. I say this the same exact thing to people who come and they say I've got all this money in a 401k or an IRA.

And I'm not opposed to people cashing out 401ks and IRAs. I think people are dumb when they even let things like paying penalties if necessary cause them to not make good decisions. Let's pretend that you have $300,000 sitting in a 401k from a former employer. And you're looking at a business opportunity that in your assessment has a very good potential.

You would need to buy in for $200,000 but you look at the opportunity and you are convinced that within 2 or 3 years you could turn your $200,000 investment into a million dollar investment. With some kind of neat business opportunity that you found. Well if that's the case then you come to me and you say Joshua should I sell the money in my 401k and cash it out to invest in the business?

Well my answer is what's a better investment? If you've got money sitting in your 401k, yeah you've got $300,000 there sitting in your 401k and the money is invested in stocks that are going up at 4% per year. But you've got this other opportunity that very realistically with good risk analysis very realistically could turn into a million dollar investment.

Then only a fool would not sell their 401k. You should sell the 401k, pay the tax, pay the penalty, invest your $200,000 into the business. And if it does indeed grow to be worth a million dollars 3 or 4 or 5 years from now you're going to be thrilled with that decision.

But the logic is the same. The logic is always what's the best opportunity that I have for my money at this particular point in time. And if you have a better opportunity for your money than what you're investing in now, you sell what you're investing in now. You deal with the cost in an appropriate way and you invest into the better opportunity.

If you don't have a better investment opportunity than what you're invested in now, then you keep the investments that you have right now and then you wait until you do have a better opportunity. It's that simple as I see it. Okay, so start with the end state and then kind of work back from there.

If I see something better and have the opportunity now to do that, then I look at if it makes sense to sell. That makes sense to me. So the question is less where my investment currently stands because whether it's good or bad is just relative to whatever else I'm going to put the money.

Right, right. Let's say that you had invested $140,000 and instead of having a profit, instead of your money having grown from $140,000 to $180,000, it's just dumped in value and it's gone from $140,000 to $80,000. And you're trying to decide, should I sell this? Well, my answer is, do you have a better use for the money?

Do you have a better investment? It doesn't matter what the current value is. All that matters is, do you have a better investment opportunity? Now, when you're doing that, you need to think about the costs. So in your situation, you have capital gains. And so you think about, I have this amount of equity, I have this amount of capital gains, I have this amount of selling expenses, I have this amount of tax or no tax.

And you consider that. And those numbers should influence it. But the logic is always the same. Do I have a better investment? Do I have a better use for the money? That's all you need to know. Yeah, okay. That makes a lot of sense. Thanks, I appreciate that. Good, my pleasure.

All right, and with that, we go to, looks like Trey jumped on. Trey in Texas, welcome to the show. How can I serve you today, sir? Hey, thanks so much, Joshua. The U.S. coronavirus relief bills, if you can call them that, have in the past had some easing of the expense that it takes to borrow against or remove money from your 401(k) early without penalty.

I just wondered, I couldn't find this morning, and I thought maybe you would know. And if not, when you speak conceptually, because maybe that has already sunset. If that is still in effect, meaning you can take money out of your 401(k) early without penalty, and I did have a better opportunity to invest in, how crazy is that on the crazy scale to remove some of my 401(k) to go and invest in, say, a real estate deal?

You heard me just give the answer. I don't think it's crazy at all. I think it comes down to you just simply say, how good is the opportunity that I have versus where I'm at right now? Yep, exactly. It's like you were talking to me, I'm the last guy.

Good. So, like if you came to me and you said, Joshua, I've got money in my 401(k), I can't get a good investment in my 401(k), it's not doing very well, but I have a great investment opportunity over here, and I can't set up a checkbook LLC to, you know, a self-directed IRA checkbook LLC, like that doesn't work for me.

Then I say, just count the cost and go. Now, in this situation, if there is an easing of early distribution penalties on a 401(k) withdrawal, then great. That just means that the cost of leaving is lower. So, you just simply look and you try to give an honest assessment of what you think the opportunities are for the investments that you currently hold in your 401(k).

You should carefully consider the costs of keeping the money in the 401(k), but simply moving to a self-directed IRA or a self-directed 401(k) if you can, with a checkbook LLC and making the investment through the 401(k) following all of the relevant restrictions. And then you should calculate the cost of simply taking it and going and making your better investment.

And then whichever one of those seems compelling, you do that. I'll just add one more thing in terms of crazy. I am increasingly less convinced of the long-term stability of, you know, 401(k) IRA accounts. And this is really hard for me personally because I spent so many years as a financial planner.

And basically, all you have in the US system and in many Western systems is the tax-deferred account, etc. But, and I've, you know, I've done all, you can do self-directed IRAs, right? You can invest in all kinds of things through your IRAs and your 401(k)s. But I think that there is a lot of value in simply having a lot of your investments outside of that world.

And as we move forward, you know, you mentioned a $1.9 trillion relief bill, right? That's, that relief bill might help and will help many, many, that relief bill will help many, many people right now who need money. But in the long run, it brings, it just makes everything worse in terms of it's all made up money.

It's all borrowed. It's all deficit spending. And it's really concerning. So, the problem is that when you have a government overspends, they know they need to raise tax revenue. So, what do they do? Well, they look for tax expenditures. That's what they call them, is tax expenditures. And so, they'll go through and they say, "Well, what are the tax expenditures that we have?" It's kind of Orwellian language in a sense because they're basically saying, "What tax break have we offered to our people?

And what tax break have we told people that they can have?" And then the government calls those tax expenditures. But they calculate, the Congressional Budget Office calculates this long list of tax expenditures, so-called tax expenditures. And they say, "Hey, we know that we have this certain tax expenditure. We know that people are avoiding X amount of dollars of tax by putting money in their 401(k).

We know that people are avoiding X billions of dollars of tax by using Roth IRAs. We know that people are avoiding X billions of dollars of tax on the inside buildup of cash value life insurance values. We know that people are avoiding X number of dollars of tax because we give them an exclusion on capital gains for personal residence." So, there's a long list of these tax expenditures.

And as the government looks to increase revenue, they're always looking at that list. I think it makes sense without being too tinfoil hatty. Like it makes sense that knowing that there's a list there and knowing that all of these accounts are on that list, at the end of the day, they're going to need to raise revenue which means that at some point, they could choose to change tax laws.

So, if you have a really compelling investment outside of the 401(k), I don't recommend to people they just go and cash out their 401(k)s because of some vague fear of what could happen 30 years from now. But if you have a compelling investment outside of it and that investment is a financially superior option but it also gives you control, then I think that's something that's well worth considering and I'm not scared of you taking money out of the 401(k) for that purpose.

I hope that's nuanced enough and responsible enough of a way to kind of talk about that particular concern. Yeah, it makes perfect sense. And you could probably do a whole show on the pros and cons of loading up your 401(k) versus having more discretionary money to invest. And I would eat it up.

Well, I probably should. I guess it's been hard for me because I've – you know, you have your conditioning, right? And your training and for me, coming from kind of the formal financial planning world, the conditioning and the training was always pretty extreme, right? What do you tell a client if you're a certified financial planner?

You say, "Hey, you got to put money in your 401(k). What's drilled into you? Don't cash out your 401(k). Don't cash out your 401(k). It's just drilled into you." And so, you feel like you're committing apostasy when you start thinking about something else. And I try to be realistic that I honestly don't think that a lot of people should, you know, cash out their accounts.

We're talking about problems that are problems but they're not current realities. But I guess I just look at it and for me, I think the bigger thing that I pay attention to is I realize how many investments that cannot be done in a 401(k) might be far more profitable.

Now, you can do a lot in a 401(k). You can invest in stocks, mutual funds, bonds. You can invest in gold. You can invest in houses. You can invest in foreign real estate. You can invest in gold coins. You can do all of these things through a 401(k) as long as you have a custodian that will help you do it.

And those are compelling tax benefits, right? You could build a multi-million dollar investment portfolio inside your Roth IRA and if the tax laws stay the way they are, that can be a really compelling thing to do. You know, you got the famous Mitt Romney IRA from years ago where he had this IRA and he filled it with all of the Bain Capital investments that were just, you know, real winners.

And the tax savings on his IRA and his family's Roth IRAs were really, really profound. And so, I would be happy to recommend to many people that they use those plans. But I also observe, especially when it comes to business, that when you're not constrained by the laws of a 401(k), you might be able to or willing to invest into something that's more in your best interest.

And to me, that often comes down to business. When I reflect back on how much money I personally had put into those tax-deferred retirement accounts and I think about how much better those investments could have been if I had invested them into business, I'm pretty ashamed of ever having participated in that system.

And so, it's hard. It's nuanced, right? Because not all people are cut out to be entrepreneurs. Not all people are cut out to be business owners. Businesses fail all the time. But I'm still convinced that there's a lot of people that are participating in those types of accounts that probably shouldn't and that would probably make a fortune if they had full control over their money.

Yeah, totally get that. And it's not just the end number, how much can I grow my wealth by the time I die. It's also the timing of when you can access the value. So, if I have more money while I'm raising a family and more freedom, then that's probably more valuable than an extra million dollars tax-deferred at the end of my life.

Right, absolutely. Absolutely. And that's where you've got to – with tax planning, as I emphasized yesterday, tax planning is exceedingly important. But taxes cannot be the tail that wags the dogs, right? They have to be something that you think about, but they shouldn't be your primary thing. Your primary thing should be lifestyle.

Your primary thing should be the total value. And once you have those things, then you look and say, "Is there a way that I can do this tax-efficiently?" Rather than making taxes your first and foremost thing. It should be a consideration, but not the primary consideration. I love that.

Thanks so much, Josh. Well, have a great weekend. My pleasure. And let's see here. With that, that finishes up our caller. So, I guess I'll just remind you as we go. We didn't get any questions on the live stream because we had some audio issues come in with the live stream.

So, we'll just wrap it up there with questions. Think about the concepts that I have shared in today's show. Think about specifically how you can apply these to your life. And always go for the best returning investment that you're capable of finding. Don't be a chicken, right? Don't sit back and say, "Well, I see that so-and-so is making a lot of money with such and such a type of investment, but I just am scared of that." Don't do it.

All right? Think broadly. Think grandly about the things that you can do. And always consider investing in active business if there's an opportunity that's appropriate to you and not just staying in the mindset of, "Oh, it's all about my passive investments and my 401(k)." I hope that I'm doing a good job of communicating the nuance.

I hope that I'm doing a decent job of just saying that there are things that can be true, but you have to look carefully at them across the board. And so make an informed decision for you and your family. And then as we go, I remind you that up until March 31, if you go to RadicalPersonalFinance.com/store, you can save on 50% on all the courses there using coupon code "Changing Platforms." And I'd remind you that one of the courses that you can access there is called the "Radical Personal Finance Guide to Career and Income Planning." And a simple application of what we've talked about is the importance of your career and your income.

A college degree is a tremendous investment for many, many people. For many, many people, it's the single best investment that they have ever made is investing into a college degree because it allowed them to increase their earning ability and it gave them a lifestyle that was really, really powerful.

And so I think it's a good example that you can apply to what we're talking about. If you were telling an 18-year-old that wanted to be a professional, right, where you need a college degree, wanted to be a lawyer, a doctor, an engineer, something like that, and they knew that was a good fit for them, you wouldn't tell that person, "Oh, go put money in your 401(k)." You would start by telling that person, "Go and get the relevant degree, the relevant credentials, and then with that, you'll be able to build a career that you'll love and then deal with the 401(k) later." So that's the basic point that I'm trying to drive at.

Go to radicalpersonalfinance.com/store. Go to radicalpersonalfinance.com/store and use the coupon code "Changing Platforms" to save 50%, but you have to do it by March 31. I'd encourage you to do it this weekend because on Monday, I'll be hosting a long series of Q&A shows where I can talk extensively with you about applying the concepts in those courses to your situation.

And I'd love you to do that and be there for those calls on Monday.