shorts I was wearing them all last week at future proof but we've got an extended summer here so I'm still getting some shorts as but we're inching closer to jogger season and after jogger season in the fall then we inched even closer to sweatpants season and the great thing about these is that they also have the built-in liner just like the shorts and the side pocket so it feels like you're wearing the bird dog shorts even though they're joggers or pants plus they have the the stretch khakis as well which easily one of the harder words in the English language to spell is the stretch khakis but they're great because they have the same material as the shorts they're very comfortable and kind of stretch and move and remember if you go to birddogs.com/ATC you get one of these white stretch tech hats which are very cool I still owe you one Duncan I keep saying that but I still have it ATC is the is the code when you check out also just FYI I think I think StreamYard might have been delayed taking us live there so I think people might have missed some of the beginning part so just the TL;DR is I'm coming coming in live from Frankfurt Germany and Ben made a joke about me wearing wederhosen so yeah in case you missed that all right I had to look it up to remember what that was called I was gonna I had a very fun day at the Hofbrauhaus when I was in college before which is all I need to say but I know you're gonna be there for Oktoberfest you're going you're kind of traveling all over Germany right yeah yeah Berlin down to Munich yeah everything okay here's I have one question for you finance wise did you check that your credit card allows free foreign transactions before you left I did yeah yeah I'm using the Sapphire Reserve for pretty much everything here so just making sure it's kind of nice you don't have to I remember when I went there in college I had to like exchange money all the time and you'd get just screwed on the the transaction fees and the whatever the currency exchange rate was they'd always you know I feel like they took two or three percent off every time so yeah a lot more places now are accepting cards too when I came here years ago it was more you know cash only kind of stuff but now I'm seeing a lot more credit so we're catching up they're going there in the future dogecoin that sort of thing right all right let's do a question okay up first today we have I'm 39 with no kids or dependents I'm a registered nurse with an annual income close to $110,000 I have $370,000 in my 401k $190,000 in an IRA and $220,000 in my brokerage account not to brag that's me not them I currently reside in a duplex where I rent out both my basement and second floor my outstanding mortgage balance is $190,000 at a fixed rate of 2.8% for 30 years additionally I have an investment property which is paid in full per Zillow the estimated value of my primary residence stands at $400,000 while my investment property is valued at $650,000 I'm contemplating using the equity I've built up to further my real estate portfolio or explore alternative investment avenues I'm faced with the decision of whether to leverage a home equity loan even with high interest rates or wait for a potential rate change also is it wise to use my equity to buy more stocks I think it's a pretty impressive question coming from a 39 year old yeah he's in a pretty good position having one house paid off and a 2.8% mortgage on another one puts Joel here in a pretty good position but he's he's come to the he's realizing the problem though he's house rich right and the thing you realize once you have a house paid off you have a lot of it paid off you have equity is great he no longer has the payments on the one house and the payments are obviously probably low on the other one but that all that equity sitting there it's you once you have it you start thinking well what good is it doing I can't spend my house I can't sell shares of my house like I could with a stock if it's appreciated in value and use it for something else the liquidity is the problem so there are some options here but I think none of them are really a slam dunk so you could open up a home equity line of credit or do a cash out refinance but then we're talking borrowing it at ridiculous rates so seven and change probably if you did a cash out refi right now and eight to nine percent for a home equity line of credit which does not sound great so if you're planning on taking that money out and looking at other investment opportunities that's a really high hurdle rate I would prefer the HELOC at this moment than a cash out refi because those rates could fall when when other rates fall it'll fall faster you don't have to refi and you don't have to spend that you don't have to start making their debt repayments right away we've talked about the HELOC before you could use that equity in your home and just sell it and use it for a down payment on new house but then again you have the higher mortgage rates the reverse mortgage is something we've talked about in the past but he's 39 years old so you have to be older to do that so again having home equity is a wonderful thing but what are you supposed to do with it there he does have a very concentrated position in real estate with owning two houses even though one of them paid off the great thing is you don't have those down payment or those monthly payments anymore so you could take that money that you would have been paying for monthly payments and diversify that way but I think something that a lot of people who own rental properties probably don't think about is why don't you just sell it right it's kind of like retirees with their principal they say like I'm never touching my principal I'm only living on the income it's a psychological thing where people I think people once they get rental properties even if they'd appreciate in value they go no I'm getting this rental income it's doing great for me and the way that real estate investors look at this is through a cap rate so let's say you have the house valued at $600,000 or whatever let's say you're netting $2,500 a month so you're not making payments anymore so after taxes and stuff and maintenance let's say you're netting 2,500 bucks a month on that that's a $30,000 a year that's a 5% cap rate call it on a $600,000 house so could that money be put to work and obviously you can play with the numbers and figure out how much you're actually bringing in to figure out what that cap rate is so could that money be put to work elsewhere with better returns possibly I don't know maybe some people just like being landlords you can increase the rent each year to account for inflation Duncan you're a renter you know how this works I actually re-upped my office lease this week and Bill Sweet was looking through the contract with me I've been in the same office since 2015 it's still barely standing even though it's even though there's been a few floods and a few problems my office is okay I still like it it's close to my house and so I re-upped again and Bill and I actually calculated what's the inflation rate been since 2015 when I first moved in and surprisingly it it almost identically matches the rate of inflation so it's 3.4% per year my rent has gone up and CPI in that time has gone up 3.3% per year not bad so it's yeah not too bad so I just I think right now is not the environment to be a borrower so he asked about could I just wait until the rates situation is better and yeah I don't know how long that will be but I wouldn't feel great about borrowing at 7 to 9% right now that's a pretty high hurdle rate I think a lot of it depends on how much you care about owning real estate because again I you could just sell the house you don't you don't have to it does sound pretty cool though to be 39 and be able to like refer to your real estate portfolio right but I think I think the reason he's having this this internal tug-of-war is he realizes like I have all this equity sitting there and I can't do anything with it yes the home equity line of credit sounds good but that that works better typically if you borrow to do a you know fix the house up or something so maybe you could you could fix your house up or you could I don't know kick your your renters out of your duplex and and live like a king I don't know I think but I think it's okay to think about selling it especially in an environment where there's not much supply and and the house is probably appreciated in price a lot and then you then you you have that liquidity event and then now what are you gonna do you have a ton of money to put the work somewhere else I think it's I would at least consider that as opposed to holding the real estate and I think probably what he's thinking about is yeah I'll take some out I'll use it as a down payment for a new place and put some leverage on it then I don't care as much about the borrowing and I guess that makes sense too but I just be worried about the the rates being so high right now yeah John Carlo in the chat asks are there arm adjustable rate he locks well he locks are technically adjustable rate as it is like the rate fluctuates it's like a live or plus something or whatever whatever prime rate plus something so it'll fluctuate but it with rates this high it's it's going in the wrong direction and they who knows they could go higher gotcha that's a but yeah the hope would be that you could I don't know pay it off with the income and if if you're borrowing at seven or eight percent and it's only for a couple years and you pay off it's for down payment and maybe it's not so bad because that the longer term is what hurts you there but yeah good for you good finance position obviously yeah yeah a few not the brags all right let's do another one another another housing when we've gotten a lot of housing ones here all right up next we have a question from max I'm 30 and recently divorced I received a hundred and thirty thousand dollars settlement for a house we purchased in 2021 she stayed in the house total liquid assets are two hundred and sixty five thousand dollars plus fifty thousand dollars in my 401k I live in the San Francisco Bay Area and make a hundred and twenty five thousand dollars base with sixty thousand dollars variable salary and my rent is twenty six hundred dollars a month having lost a five hundred thousand dollar mortgage at three percent I feel I'm stuck without a home in the current market friends are taking out seven thousand dollar monthly mortgages when comparable rents are four to five thousand dollars how is that sustainable how am I supposed to purchase something at six to seven percent on a single income I've explored land purchases to create Airbnbs or purchasing a rental property but barring costs and high prices make this feel impossible I feel like I'm not getting the full value of my two hundred and sixty five thousand dollars and I'm unsure of how to allocate it for my financial future aside from getting another wife to pay half the bills what should I do okay I understand the consternation here this is a tough break obviously divorces sorry to hear it yeah sorry to hear I mean that's always difficult from an emotional perspective but there are financial considerations as well I also wonder number in wedding crashers Vince Vaughn and Owen Wilson's characters are like divorce settlement attorneys and they help the negotiation I would love to know how those negotiations went for a three percent mortgage because how much is that worth in a seven percent environment like do you think that this guy kind of got screwed a little bit for his paint payout yeah I would have I would have done some discounted cash flow analysis something I'm not I'm not trying to say you got screwed but I think you might have got screwed because yeah that's all I was thinking that sounded a little low given what he's talking about yeah and I I've made this joke before but I've heard of stay together for the kids I wonder how many people are staying together for the three percent mortgage these days right stay together for the mortgage all right so Max here is in a tough spot the housing market is broken in many ways affordability about as bad as it's been we've talked about this before plus he lives in the Bay Area where house prices were unaffordable before we got to seven seven and a half percent or it was great yeah but I think there's a lot of peer pressure in these especially since he's 30 when it comes to the housing market and it's like you have to buy a house why are you paying someone else's rent you have to build equity I'm sure people have heard these ones before or he's thinking it himself here's the secret especially if you live in a high-cost moving area buying a house is not for everyone I know it seems like it has to be but owning a home is not for everyone yes it's a wonderful hedge against inflation it's a for savings vehicle it offers this wonderful form of psychic income that's really hard to match but that doesn't mean everyone has to buy a house here's the here's the list of people who shouldn't buy a home number one you want to retain some level of flexibility in your personal life or your career because you move around or whatever you don't want to put pay all the ancillary costs that come with a home ownership I've heard the line before that when you pay your rent your your housing costs are done right but when you pay your mortgage that's just the start of your housing costs mortgage plus all these things yeah another one is you just don't want all the responsibilities of owning a home it's the landscaping the upkeep it can be a lot for some people I think if you don't live in the house long enough to cover the swishing costs from buying selling moving closing costs all these things other people I think if you run the numbers and realize renting makes more sense for your financial situation and I think the last one is if you live in a high cost of living area I think the first one about retaining flexibility makes sense here because this guy just got a divorce his life is probably in a state of upheaval I don't know if he wants to think about moving somewhere else or if he has the potential for a job maybe he just loves living in the Bay Area because of friends or family or he just he just really likes it but I think the last two make the most sense you run the numbers and realize renting is better for you or you live in a high cost of living area right I think you know as he pointed out in his question buying is just more expensive than renting he's paying $2,600 a month in rent and $7,000 for mortgage or whatever Redfin actually did this analysis and they looked at the largest premiums in terms of renting versus buying and John throw up my chart here this is from Redfin and it looks at home ownership premiums so in San Jose is the worst one it's 165% more expensive to buy than to rent San Francisco it's almost 140% you can see the top ones here are almost all California right and this analysis was done on mortgage rates for 6.5% because they did this a few months ago now it's like 7.3% at the latest I think so John do the next one which is the most populous cities this is like the most populous cities with the biggest premium you can see a lot of them are in the Bay Area San Francisco Oakland Anaheim it's a lot of West Coast places a lot of California and it's just so I looked at the the median home price in San Francisco is like 1.4 million dollars kind of sounds like a lot so if you wanted to buy and you put 20% down that's 280 grand and you said your liquid net worth is 265 so it's your whole liquid net worth plus 15 extra thousand dollars plus closing costs and all that stuff with a 7.3% fixed rate mortgage over 30 years we're talking $7,700 and that's before property taxes insurance HOA maintenance is it really worth it to use all of your liquid financial assets and spend $5,000 more a month or more for your monthly payment just so you can own instead of rent for I mean for some people the numbers might not matter they simply want to buy a house no matter what ensure you have the ability to refinance even if you refinance that mortgage if rates went down to 5% you're back you're at $6,000 a month so my point is you don't have to buy a home just because society says you do especially in a situation like today you have to run the numbers you have to understand your circumstances and I don't think you need to be in a rush especially if your life has come up under like some big upheaval right so buying a house can be a wise financial decision for some people it doesn't have to be for everyone I say don't be in a hurry and and wait just because someone says you're paying someone else's mortgage because if you can take those savings figure out what you'd be paying in a mortgage and save the difference you're gonna be you're gonna be a pretty good place financially maybe in a few years you do feel like okay I've saved enough now I want to go ahead and buy then imagine how expensive California would be if they didn't have earthquakes that's the trade-off the earthquakes and wildfires kind of balance it out but it's still ridiculously expensive to live there obviously yeah but yeah I if you're in a high cost of living area like that and rent is that much cheaper don't be in a hurry to buy just because you think you have to owning a home is not for everyone good advice says the homeowner right fair stay away from my house let's see I'm in my early 20s with a stable job should I sell down assets in my Roth to pay off credit card debt okay you got a nice and succinct this question is you what did you say does to ask how do you I can't even say the name about how yeah we do get a lot of information from our from a lot of very long questions yeah what you see on the show is actually the abbreviated version usually yeah people want to make sure that we got all the bases covered okay Duncan what's Ben's number one rule of personal finance pay off debt pay off your credit card debt right not paying off your credit card debt each month is a personal finance killer it's like Jim Simons level of compounding but against you right it's like in the opposite direction so I don't think you necessarily have to pay off like liquidate your Roth to pay off your credit card you it is an option but you I would just recommend that you'd use the contributions from your Roth and not take out any gains that you might have because then you have to pay an early withdrawal penalty but you that's one of the benefits of a Roth is that you can take out the contributions tax and penalty free so I think this decision probably comes down to loss aversion versus debt aversion loss aversion I've been trying to teach my daughter this lately that losses sting twice as bad as gains make you feel good like when her favorite team loses it makes her feel worse than the winds feel good so I think if seeing a chunk of your Roth assets just that evaporate even if it makes your debt go away if you can't handle that I think that's one way to think about a debt aversion I think if it just causes you pain all the time to be in this debt and you feel like it's just a burden and a weight on you then maybe taking out some of those Roth conversions make sense I think you could start the initial first step would be just stop making any further Ross contributions and use whatever contributions you're making to pay off your credit card debt I think that's a good first step you could also look into a zero percent credit card and do a balance transfer Duncan we've been talking about this lately a lot of these places will allow you to open up a zero percent credit card for 15 18 21 months and then you pay 3% for a balance transfer now that sounds like a lot until you realize that you're paying a 27% or something on a credit card interest so I think that's a pretty good first step and that'll give you some breathing room to pay it off slowly instead of trying to pay it off all at once and again I think you can then take your Roth contributions use those to pay credit card debt once the credit card debt is paid off then roll those payments right into your Roth again so you can kind of play catch up and then you're you're in business that's the route that I recently to so yeah it's I mean 3% with my track record that's not that high of a hurdle rate in the market you know right yeah compared to Oatly options it's pretty good yeah so and the other thing is I would for all your credit cards going forward like paying it off would be nice but it makes no difference if you're just gonna rack up more credit card debt in the future click that autopay button to pay the entire balance each month and hold yourself accountable to pay it off and don't let it roll over each month yeah I mean this math is much clearer if you are paying 24 27% interest on a balance on a credit card like you got to get rid of that right I mean that's that's brutal yes that that's ridiculous so it figure out a way to do that all right cool let's do another long one up next yeah up next we have a question from Jeff I'm retiring in a month at 56 with a four million dollar portfolio no debt a three hundred thousand dollar severance package and a 5.2 million dollar net worth Jeff's pretty set in my opinion but non-professional opinion I'm married with two daughters college paid for I know it seems dumb but I'm trying to decide on a 50/50 simple for fund ETF portfolio versus my 55/45 simple for fund portfolio in perpetuity that's a hard word it's the difference of a hundred and fifty thousand dollars which is probably relatively small compared to the entire portfolio but I keep reading about how going to a 50/50 at the start of retirement is important to avoid sequence of returns risk I've put three years of cash away in a 5% t-bill ETF and we'd be very comfortable living off a 3% withdrawal rate I've always followed a monthly DCA plan and rebalance yearly and it's served us well it's weird but I'm stressing over this but I would like to only retire once a simple go for it will suffice and I'll do the 55/45 I don't want to be greedy and have too many equities and don't want to be stupid by being overly conservative I'm going to need you to break this one down all right Dave in the chat says he wants Jeff to just simply adopt him because he's got somebody not to brag here this sounds like an asset allocation question because it's like should I be 50/50 or 55/45 but it's really a financial planning and even more behavioral finance question so let's bring a financial advisor in here to help us out with this one Nick Sapienza hey guys Nick I think I think Jeff here has been reading Michael Kitsis who have some research on this that says early in retirement sequence of return risk can kill you because if you start out with a bear market and you sell your stocks you're gonna put yourself into a hole so I think that's what Jeff is worried about here should I get more conservative but obviously the the difference I think between 55/45 and 50/50 is kind of splitting hairs here yeah exactly I just want to call out a few things from the question right 56 married two daughters college paid for four million dollars investable no debt $300,000 severance package 5.2 million dollar net worth and the question is 50/50 versus 55/45 it's a difference of 5% or $150,000 right these are minimal differences when in the grand scheme of things and he mentioned reducing sequence of returns with so just to back into that we talked about this the first time I was on a few months ago it's the order in which you get a bear market so like to Jeff's fear is what if I'm retiring and this is the top of the market like it was in 2000 or 2008 what happens to my portfolio but he's already mitigated probably 95% of those risks right he's the biggest risk for sequence of returns is you're forced to sell your stocks when they're in a bear market right so that's that's that's the hardest part is you don't have to sell when they're down because if you're the timing every withdrawals works out bad where you're down 40% and you're selling your stocks then you're you're setting yourself up for potentially failure in retirement yeah exactly you can't make it to the other side of the bear market or secular bear market where you run into the bull market and that usually would offset that right you have to worry about running out of money but in his case low withdrawal rate a three-year cash buffer I mean usually it's like one or two years so he's gotten more on that side and then assuming he's got in that for ETF portfolio it's globally diversified it's not just entirely in like one specific country or sector or anything like that lastly it's the behavior piece that mitigates that sequence of returns risk is behavior and impulse control so whether or not he can stick with it we've got a few charts here just to you know go down the rabbit hole for fun and explore this a little bit the first one is just comparing the differences in the 50/50 versus the 55/45 the difference is half percent per year which is meaningful especially over a 40 year time horizon which is what Jeff potentially faces right and so it's again it's really look at that chart it's it's it's I mean you're hugging the line there either either one you're you're you're pretty much going to be in the same spot exactly and these are kind of like cherry-picked dates right well I mean at least we've got you know a full market cycle and and a few bear markets embedded in this but it's neck and neck there's like no difference whatsoever the next chart is okay well what if Jeff's thinking in terms of you know he's backtesting his portfolio and he's thinking in terms of maximum drawdown and he says and the way that he's gotten to 50/50 or 55/45 is not just so much by sequence of returns risk but his max pain threshold he said this is the most pain that I can tolerate and in you know it's at 31 I mean you're looking at 31% in 2008 for a 50/50 portfolio and then on the next chart you'll see the 55/45 breakdown now this is the act we enact so this is a globally diversified portfolio the 55/45 you're looking at a negative 34% drawdown in 2008 so again not really a huge difference if you look at the long-term average 4.78 versus 4.36 on the average drawdown this is pennies and so really what this comes down to is that the best plan is the one that you can stick with my thoughts on this whole topic or that you know Jeff is splitting hairs and typically when we split hairs it's usually about something else so the thing is not the thing this isn't really a stock or bond question this is am I going to be okay okay question Jeff needs the validation that he's making the right decision so that he can have conviction in his own plan and he could move forward with that and stop second-guessing it right it sounds to me like Jeff might need to talk to a professional just to be like tell me I'm gonna be okay because we could put all take all these inputs and put them into a financial planning software and run to Monte Carlo simulations and I'm guessing either one of these would show you know you have a very high probability of succeeding in your financial plan right regardless of the allocation so it's just you know this is perfect being the enemy of good here and in just being like I need someone to help me make this decision just point direction he's got everything else right but he's I think he's missing the psychological aspect of this is that decumulation is a difference is a different mindset than accumulation right he's always stuck to and been very disciplined in a DCA plan but now he's taking assets out and even if we know the math and he's probably he's probably looked at money Carlo calculations but even if we know the math it's really hard for us to reconcile the fact that we can take a hundred and twenty thousand or you know three percent out of a portfolio every year maybe increase that by inflation and yet if he's read kids this if he's read the sequence of returns papers he could on average according to the data end up with maybe six times more than the amount that he started with despite the bear markets corrections you know dips and everything else that accompanies right he's obviously conservative enough by holding three years in cash so that that piece to me that that's like how do you fight sequence of return this Duncan you said it's yeah you have a cash buffer it's a cash buffer in diversification that that's it so he's got that he's got to figure out so that being conservative he's got that that totally like tied up in a neat bow seems fine yeah I just kind of need someone to help him decide he wants them to say yes you can you're gonna be okay and we don't know exactly how the future is gonna play out but I think based on the circumstances you're doing pretty good it always helps to have that third party that's unemotional and that can pick apart your you know sort of it's you know I don't want to say distorted thoughts but just slightly disrupted thinking about his portfolio and really focusing on one thing stressing over too much and I think one more point like one thing that he's maybe not focusing on and and Jeff don't mean to throw a wrench into this you can you've got plenty of time you can kick this can down the road but is longevity risk he's 56 he might need his plan to last for 40 years so he is focusing a lot on minimizing downside making the right decisions but at the same point you can't constrain upside Nick you just caused Jeff to go into like an eight-year cash but I did I shouldn't have said it take it back delete this I take it back well I'm guessing to I mean revisit this in five years Jeff but just get the 5545 gone having this level of wealth I'm guessing Jeff is really into doing this on his own right I'm like managing that could be that could be feeling those people would be like you know what he's obviously done yeah he said his research and maybe doesn't want to take his hands off the steering wheel but I think you can at least talk to someone it doesn't have to be a relationship that you're in forever it could be a one-time hourly kind of meeting if you yeah you can talk to planners on an hourly basis that won't take that won't take over the investment management piece that that is available that is an option and I think that's definitely a good idea for him to get that affirmation but all right so my my my my takeaway is is go forward but also you know leaves room for flexibility sorry yep you got to be flexible all right next question Duncan hey up next we have a question from Lars my small business employer uses a simple IRA it caps out at fifteen thousand five hundred dollars this year so I effectively lose out on thousands of dollars of potential investing each year compared to my previous and previous large employer that I had a 401k with what is the purpose of this difference why does it feel like I'm being penalized for working for a small business I'll be muted you're muted in oh sorry I don't know why there's not just one big bucket for everything right retirement HSAs 529s just give everyone a big it should be like a speed limit everyone follows the same limit I don't know why that for some whatever reason someone's working on that someone's working on that a portable retirement plan that attaches I think to you like your social security number but so what what what other options do we have here because he's he's saying listen it's fifteen five hundred I think the 401k is twenty two five now is that about right for yeah yeah so the max the max in the simple is fifteen five you get a three percent employer match plus a catch-up contribution of thirty five hundred bucks if he's over 50 I'm assuming he's he's not because of the limit what's the simple part why is it called simple it's an acronym and and and really it kind of ties into the name it's supposed to be simple and easy to set up which is why they were at one point popular but basically so so look I mean he could his alternatives are that I mean a small company there's pros and cons to being at a small company pros and cons of being at a large corporation that would offer a 401k but maybe he can be vocal about it in in bring up you know hey should we review this should we look at other options you know should we look at 401ks but he can also save into an IRA at the same time he may not be aware of that he can max out a traditional or Roth IRA to sixty five hundred to seventy five hundred so it still doesn't really you know shake a stick at a 401k and the benefits of having those those three buckets usually of a pre-tax Roth and after-tax account but to answer his question you know why do they why do small businesses have them is because they're small and they might be you know cash constrained time constrained they might have you know ten or twenty employees and so they don't want to go with a full-blown 401k plan cost-effective maybe yeah but the thinking is about is a bit outdated look simple IRAs did you kind of they suck to be honest 401ks are superior in every way and now they've caught up to where the costs are it's more affordable and you can work with someone to take care of all the paperwork and you can have a TPA involved and there's more flexibility around them and whatnot but it's a lot easier to with a company like Betterment or something for a small business that you could do it now it would be a lot easier the other thing is if he has any other form of income outside of his employer he could do a SEP IRA right if he has some other income the other thing so Nick my Julie member Duncan on this show said why you shouldn't max out your 401k and he said if you put your money into index funds and buy and hold and don't make a lot of moves that are gonna cause taxes that you can end up pretty close to the same place so I guess a brokerage account is probably an option here too as long as he's not trading his face off right exactly yeah he could throw it in some ETFs and it you know it's not as tax advantage of course but it's it's better than nothing yeah simple simple IRAs are kind of like DVD players no one really has much use for them unless you're Michael Batnick I guess but they're a bit outdated 401ks are much easier to set up easier to get going and the problem is a lot of these I'm sure a lot of this stuff was was set up like with good intentions at the time and now that it's just we have all these different programs and plans and it would be nice we could simplify it but the unfortunately the tax code and the government doesn't really work like that so there is another one case are just too too complex and expensive for small employers basically is that what it comes down to they were there really not anymore it's just kind of an outdated it's an outdated piece maybe they initially sought out a 401k and they were advised to use a simple IRA but things have changed but there is a change talk to the HR people about this for sure yeah I would bring it up I think it's worthwhile and I don't think he's really overstepping just to ask a question you know just to look at other options but the there is a new update thanks to Daniel Rosa he runs all of our corporate retirement plans so we do small business 401ks and such here the secure act 2.0 now allows for a Roth option within his simple IRA plan so I can't fix the contribution limit but at least you know now you're aware of those other two options of the Roth and the additional Roth IRA contribution that you can make so Dave in the chat says simple stands for savings incentive matching plan for employees all right I feel like that's kind of a stretch they just wanted it to be simple and they just came up with words that match but nothing like using simple as an acronym for something that doesn't sound simple yes all right next week Duncan is off he will be traveling throughout Germany drinking liter beers and eating wiener schnitzel you know hopefully in a meter hosen but yeah okay that's just true I got sick on it when I was there actually it didn't didn't didn't sit right with me yeah you won't be eating you'll be eating a lot of pretzels I love I love a good pretzel okay thank you to Nick for joining us and helping out with some financial advice questions bill sweet next week we'll be filling in for Duncan as my co-host remember email us ask the compound show at gmail.com we always appreciate everyone in the live chat leave us a comment or a question on YouTube and we will see you next time see you everyone see ya thanks guys.

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