Amy: Tonight, new inflation numbers are out. So, what do they mean to you? And, when it comes to your HSA, that health savings account, are you using it right? We'll take a closer look. You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Brian James, who's in for Steve Sprovach.

You know, these were much, much anticipated inflation numbers, Brian, because, of course, we're hoping that they're moving in the right direction, so the Federal Reserve can quit hiking interest rates. But I don't think we got anything majorly surprising today.

Brian: Yeah. So, Amy, I've been in this industry for about 25 years, so I've spent most of a quarter-century not talking about inflation. All of a sudden, we're

Amy: Isn't it crazy? I completely agree with you. I've been doing this show forever, and actually, was talking to Steve Hruby yesterday, who's only been doing this show this year, and he was like, "All we talk about is inflation." And I was like, "For years, literally, the word was never mentioned on this show." It just wasn't an issue.

Brian: Right. And then, that kind of leads us to believe that when we do have it, now that it's here, that it's a super-scary thing that we have to be absolutely terrified of. And that's not really the case, right? We have tornado warnings and watches all the time. We don't freak out about those. They don't happen every day, but we pay attention to them. So, just some new information.

So, here's where we are. We'll get a little technical here with boring numbers, but at the end of the day, inflation's a number, so we're kind of stuck with that. And if you're economist, well, hold on to your hat, because this is fun stuff for you. So, in June, we were paying about 3% more for stuff than we did a year ago June. So, 3%'s not too terrible. July, however, it ticked up a little bit, so a 3.2% increase. Now, two tenths of a percent is not that much, but on the other hand, this is more directional. So, what we're hoping for, you know, we're down off of the cliff of 9% inflation, that everybody kind of, you know, panicked and thought that was gonna hang around for a long time. That's not happening anymore. We're down closer to in the 3% range, but we've taken a step back a little bit in terms of this tiny uptick.

So, it's always gonna be three steps forward, two steps back, just like anything else. The goal that the Federal Reserve has, we wanna get it in the 2% range, right? That's what we've had for a very long time, back to those days when we weren't talking about it at all. That means it's usually about 2% or so. So, we're closer than we were, but this little uptick is slightly disappointing. We would like it to go down again. So, we'll just have to keep paying attention and see where we go.

Amy: But I think the question is, is this, like, a run for the hills, the Federal Reserve pivots again, we start raising interest rates? I don't think that these numbers, based on, just, on their face at this point, are anything that's gonna actually have the Federal Reserve freaking out, right? "What do we need to do? We need to get more aggressive here." It's just gonna be harder and harder to get this number closer to 2%, because that 9% has fallen out of the numbers from last year. So, as those percentages go down, right, and some of the higher numbers fall out, it gets harder and harder to bring this number closer to 2%. And there's a number of other factors that go into this, including the fact that we're all really spending, and we're making more probably than we were just a year ago. And so, all of those things are gonna keep inflation trending a little bit higher.

The number, though, that the Federal Reserve really cares about is core inflation, right, which strips out the volatile food and energy prices. Gas prices have been on the rise lately, and that core inflation number is closer to 5%. It did tick down a little bit month over month. We were at 4.8% in June. Now we're 4.7% in July. That's a good sign for the Federal Reserve. That is trending in the right direction. But to your point, Brian, because that's the number the Federal Reserve really cares about, that is still a distance away from that 2% number. And I think the interesting thing is that Fed members seem to be kind of all over the place about where we go next.

Brian: Yeah, it's kind of like when you go on a diet, Amy, and I'm not implying you need to go on a diet, but it's, just in general, when you're trying to lose weight, if you're dedicated to it, then those, let's say you wanna lose 15 pounds. Well, the first 8, 9, 10 pounds might come off pretty easily, because it's a new thing, and you're devoted to it, and you're really trying hard. Then you get to those last three, four, five pounds, and they just won't go away. Well, that's the stage of inflation that we're at now. We're not at 9% anymore. We've kind of done the easier things.

But part of this, as you mentioned, is because we're in what I like to call the "treat yourself economy," because it's been rough, it's been bumpy. We all went through COVID, and everybody's kind of grumpy about that. And so we've decided that, you know what, I wanna take this vacation. I wanna buy a bigger house. I wanna buy a nicer car. Well, everybody who can profit off of those things is doing so, because the knowledge is out there that the American public is gonna pay for it. We're gonna, right? We grumble at the grocery store checkout lines over the price of eggs and steak and whatever, and then we swipe the credit card anyway. So, we really haven't changed our buying patterns as a result of this.

That's a good thing. It means the economy can withstand, you know, certain things. And this is not to say that it's easy out there for everybody. It absolutely is not. However, there's enough people out there that can withstand this, these price increases. That's why they're happening, right? So, if the demand dropped off, if enough people said, "You know what, I'm not doing these things anymore," then we would start to see that that might be the last part of inflation that's stubbornly refusing to go down, you know, just the refusal of people to not do things that they wanna do. and we're, you know, who are we to say that we shouldn't be doing those things? But that does factor into the math.

Amy: Well, and it is funny, because when you think about, back to the global pandemic, when everything was shut down, the savings rate, the average savings rate in the U.S., was north of 30%. And we went, "This is amazing. Also, this isn't gonna last," because as soon as the economy opened back up, to your point, what do we do as Americans? We spend. We love to spend. We love to travel. We love to eat out. We love to buy things. And that's what we're seeing at this point. In fact, one of the reasons why prices are so high? Hotel rentals, dining out, entertainment. All the things that we love to do, that we couldn't do for a while there, that everyone is out doing in full effect right now.

You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Brian James, as we're digesting the latest numbers about inflation. What do they mean to you? Does it mean that you're gonna be paying less at the grocery store soon? That we're gonna be down to that 2%? That maybe the interest rates on your mortgage will start to fall? Well, maybe not so fast.

You know, I remember talking about, many times, talking about gas prices, right? And kind of the rocket and feather of gas prices. They rocket up, right? I mean, they, it's like, overnight, all of a sudden, you're like, "Whoa. I just filled up a week ago, and all of a sudden, look at these gas prices," you know? You start to really notice that they've gone up fast. And then when they start to fall, not like a rocket. Like a feather, right? It just takes forever to bring that down, and that kind of approach in the economy is exactly what we're seeing with inflation. It felt like it ticked up, "Whoa," right overnight, and all of a sudden, you were going to the grocery store and you were doing a double take. "I'm buying the same things I was three months ago, and how can it be this expensive?" Well, it's like gas prices. With inflation, it's like a feather coming back down, and it takes a lot of work, and there's just a lot of factors that go into this.

Brian: Yeah, and then, let's not lose sight of the fact that behind this, you know, we are the United States of profit margin. So, as I mentioned before, anybody who is looking to make profits in this country, you can do so by simply taking advantage of the reality. And so, no, they're not gonna be in a huge rush to lower prices. As long as people are still willing to pay...

Amy: Reinflation, right?

Brian: ...it's... Exactly.

Amy: They're protecting their profit margins.

Brian: It's still supply and demand. If the demand is there, then the supply is gonna meet it at whatever price it can get. That's just the way that we are. So, you know, before we get too freaked out about the underlying economy and so forth, you know, don't forget the idea that companies out there don't exactly mind the fact that prices are a little bit higher than they normally are.

Amy: So, the question is, like, how is the Fed gonna react, right? What's next? They don't meet again until September. There's a lot of data that comes out between now and then, you know, and some members of the Fed are saying, "Listen, we're not gonna say anything until that data comes out." And we've seen this over the course of the past year, right? Data comes out one week, and it's like, "Oh, it's pointing to the fact that maybe we're good." And then, a week later, some new numbers come out on the labor market, or inflation, whatever it is, and all of a sudden it's like, "Wow, maybe we need to do something," right? So, some are taking kind of a wait-and-see approach, but we're really all over the map here, Brian. I mean, there's some that are saying, "Listen, I think we've probably done all we need to do," and some that are saying, "I think we need to continue on this aggressive path." And keep in mind, what they're looking at is historically what has happened, and we saw this in, what, the late '70s, early '80s, trying to bring inflation down, and they just didn't do enough, right, when Volcker was in, and then it just got out of control, and then it was years and years and years of tweaking things before they were able to get inflation under control.

Brian: So, we did just get a rate hike, right? So, we just, a week and a half ago, it wasn't a big surprise or anything...

Amy: Right.

Brian: But it was fairly well-expected. And at that point, this is what Allworth thinks as well, the thinking was we're probably done. Maybe we're looking at a couple rate cuts starting in Q4. Remains to be seen. So, we did just, of course, get the Fed's opinion in that manner. That doesn't mean they're not out there talking about it, though. So, and the good news is that none of the representatives of the Federal Reserve are really sounding the alarm bells at all. So, the Philadelphia Fed president used the...basically said that we're probably near where we can hold rates steady. This came out on Tuesday, the other day. So, another individual used the term "Let's be patient," and, "I don't see any reason to prejudge," and so forth. So, the general mood of these folks who are in these meetings, who are in the room where it happens, is, "Let's not panic." It's a step forward, sure, in inflation, but it's not gaining momentum yet, so we don't need to change the course that we're on.

Amy: And I think it's just important to keep in mind, we are so impatient, right? And it feels like, "Okay, we have been dealing with inflation forever." And this 2% goal is gonna be difficult to reach. And so, in the meantime, there might be a little more pain, you know. But I was talking to Andy Stout, our chief investment officer, on Monday, he came on the show. And he is truly, when it comes to numbers, money, the economy, one of the most brilliant people around. I mean, he just studies this stuff day in, day, night. I think he probably falls asleep looking at these numbers. I have no idea. But he really knows what he's talking about. And I put him on the spot. I said "Okay, if you were a voting member of the Fed, where do you go in September? Do we go up? Do we stay?" And he says, "I would probably vote to stay. I think we've probably seen, you know, all the raises that I think we need to."

I mean, you have to keep in mind, too, there's a lag time. It's not like when we usually do something, and the consequences happen in real time. It takes a long time for these things to filter through the economy. They're these tiny little dominoes that slowly, slowly fall, and you really never know how many you're gonna fall, or how long it's gonna take. And it can take six to nine months. To your point, Brian, we just raised rates again, few weeks ago, couple weeks ago. You know, and the impact of that may not be seen for six to nine months, which is why, thanks, but no thanks, if someone were to offer me, which, you know, they probably should, a position on the Federal Reserve. It's a tough job because it is a tough tightrope.

Brian: Well, yeah. How has that not happened already, you know?

Amy: I ask myself that from time to time. I think they're missing the boat here, but it's an obvious choice. They're just not making it.

Brian: Yeah. So, a little bit of history. So, we dug into some numbers, just kind of see, you know, what [inaudible 00:11:29] has looked like in the past. The last time we had a similar situation, right, we're not talking 40 years ago, right? But in April of 2004, inflation ticked over 2%, which, that sounds like nothing now, but that was an attention-getter back then. We had just survived the .com bubble, and things were going okay, and that inflation rate stayed elevated until about September of '08, and then we had a bit of a spike to 3.7%, which ironically, is in the ballpark of where we are right now. A month later, it was back down to 1%, and the Fed had lowered interest rates seven times by then, to try to slow things down. So, it just takes time. That's about a four-year period for all of this to soak through. That's a good example of what this might feel like. And we're a couple years into it now.

Amy: Yeah. I think history often shows us, right, where, how long it could take, and what we need to be expecting, and also, pack your patience along the way. Here's the Allworth advice. Don't be surprised. It might take a while longer to get inflation down to that 2% target rate. Don't worry too much about it though, as it relates to your investments. Just stick with your smart, long-term plan.

Coming up next, we've got the stunning amount of credit card debt that's out there. And, should you invest the money in your HSA? We're gonna tackle that too. You're listening to "Simply Money," here on 55KRC, THE talk station.

You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Brian James. If you can't catch the show every night, you still don't have to miss a thing, because we've got a daily podcast for you. Just search "Simply Money." You'll find it on the iHeart app, or wherever you get your podcasts. Coming up at 6:43, my all-time favorite topic. If you listen to the show, you already know what it is, HSAs. What you need to know about them in order to make sure that you are using them the best way possible.

Do you have Swifties in your house, Brian?

Brian: I do not. But in my neighborhood, I'm surrounded by them. So, it was a big, big deal a few weeks ago, when everybody got dressed up and headed down, and there were rides arranged. Other neighbors were driving people back and forth. So, yes. Big, big deal in my neighborhood.

Amy: Well, and not only big, big deal in your neighborhood. It's been a big, big deal for the economy. Whatever city she goes into, they literally have this huge influx of money coming, and people, of course, you know, hotel rooms, and restaurants, and all the things. But now, the latest thing where there seems to be a huge boom on making money when Taylor Swift comes to town is on the things that you need to make friendship bracelets. I don't know if you ever did this, but, I mean, seriously think back to your middle school self, the colored yarn... They have some of the little beads that have little letters on them, whatever. But what they have seen, and I think this is absolutely crazy, but not surprising, in cities where Swift has had tour stops, Michaels, right, the crafting store, 300% sales lift in beads and jewelry categories in the days leading up to the concert. I mean, there's literally nothing that the Swifties will not buy, will not spend money on. It's crazy. I don't know that I've ever seen anything like it.

Brian: You know, it's an interesting phenomenon, but it is, it's a really cool business story. Like, what are the spin-off [crosstalk 00:14:31]

Amy: Yes.

Brian: The thing I think about is, you know, with the gold rush of the 1840s. It wasn't the people mining gold that made money. It was Levi's, who parked shop out there and started building jeans for everybody. And Wells Fargo, and they needed a way to, you know, get cash out there and so forth, so... It's just the spinoffs, of when a bunch of people go do a thing, what can you find? What opportunity can you look for? And in this, it's 7th-grade friendship beads and Michaels.

Amy: Yeah, and I think, you know, just thinking about the fact that the last time we saw anything huge like this was of course, when the Bengals went to the Super Bowl a couple of years ago. But even then, it was, like, apparel. It was, like, the things that you would expect. It was not all of these crazy categories. But anyway. Very cool that she has such loyal fans, and the experience, I haven't been, but I've seen it all over social media, apparently is just amazing.

Here's what's not amazing. This is actually the opposite of amazing. It's not a good thing for any of us. The amount of debt that Americans have taken on. It is a stunning amount of credit card debt. Went down, right, during the pandemic, and as soon as we could get out there and start spending again, man, did we.

Brian: American way, right? So, the reason this is a headline. Credit card debt's not a new thing. We know that's been out there, but unfortunately, we've hit a milestone. Collectively, Americans now owe more than one tuh-tuh-tuh trillion on credit cards. So, we finally broke through a barrier there, that is not really gonna help anybody in the long run. So, total credit card debt, up about 5%, or about $45 billion, just in the second quarter. So that puts us over to about $1.03 trillion. This is coming from the Federal Reserve Bank of New York, so this isn't a, you know, a one-off magazine reporter kind of a thing. So, big news. Delinquency rates are still low, right? So this hasn't sunk anybody's ship, really, yet. But these rising balances are gonna make some challenges for people going forward, right? So, especially for people in situations where they've got student loan payments coming due, right? I'm having a lot of calls with my clients who are worried about their kids, because this is on the horizon, that the moratorium on student loan payments is going away, and it's gonna be a debt they have to pay.

Amy: When you think about that student loan debt, if something's paused for a couple of months, right, like, that's one thing, but it's been paused for two years. And so, people absolutely have shifted their budgets during that time, to not necessarily include that student loan debt. Now, all of a sudden, you have to pay that student loan debt, and at least the minimum on the credit card, and we would say that's the worst thing that you could do. You should actually pay more than that. And I think there's gonna be a ton of people out there struggling to make ends meet.

Brian: Yeah, that's true. And this is not only... Normally, when we think student loans, our brains go to, you know, young, recent college grads. That's not only that case. There are a lot of people out there who took on a second career. Maybe they got into nursing or something like that. I'm having conversations nowadays with people where not only are we talking about when they should file for Social Security, but how we're gonna work their own student loans into their retirement budgets. It's not that common, but it does happen. So, this is a pervasive problem, that people are gonna have to build their financial plans around. You know, the normal debt we all incur, mortgages and car loans, that's all out there. But again, like you just said, people have absorbed those payments, right? We haven't had to make payments in a long time. Therefore, we've absorbed it, and we may not have the room left in the budget, and that's a very important thing. But it all comes back to what we say all the time, which is, first of all, you've gotta know where your money's going. To understand how you're gonna survive into the future, you gotta know how you're living now, and then build off of that.

Amy: Well, let's talk about it. If you are in a place where you're stressed out, maybe you have the student loan debt, maybe you don't, but you have racked up credit card debt, or maybe it's your children that you're worried about, you know, I think the first thing is a kind of really truthful conversation about how am I gonna get this under control? And it's also kind of a look-yourself-in-the-mirror, and know yourself. But there's two main ways that you can pay down that debt. One is the snowball method, and the other one is the avalanche method. And the snowball method is really, like, if you're someone who needs to kind of celebrate little victories before you can really get yourself up and working on a project, or something that you know you need to do on a goal, then look at the smallest balance that you have to pay off. Get that one paid off. All of a sudden, you feel good about yourself.

Brian: What can I accomplish right now, you know?

Amy: Exactly.

Brian: Where's my quick win? I got this couple thousand dollars from that piece of furniture we bought, and then I've also got the $15,000 one. Well, tackle the $2000 one, because you're gonna make that go really, really quick. Then you can spike the football. And then, whatever payments you were making on that, those payments immediately get added on to the payments for the next largest amount, so you're simply picking them off one by one.

Amy: The key is to get it done. Here's the Allworth advice. If you or your kids can't pay off that credit card each month, take a good, hard look at what you're spending your money on. Coming up next, we're looking at a series of new scams that could be targeting you. What you need to know to protect yourself. You're listening to "Simply Money" here on 55KRC, THE talk station.

You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Brian James, in for Steve Sprovach tonight. After a several-year hiatus on repaying student loan debt, at least federal student loan debt, this fall, if you have student loan debt, you're gonna have to start repaying that, and there are lots of questions, concerns, all kinds of talk about it. But of course, there are also some scams around this, so to be sure that you are protecting yourself and not falling for those scams, we have our scam expert, Jocile Ehrlich, from the Cincinnati Better Business Bureau, as she always joins us with important warnings, things that maybe your friends and your neighbors are falling for. We wanna make sure you aren't falling for as well. Student loan forgiveness scams. What do we need to know about?

Jocile: Okay. Well, as you said, Amy, there's been a three-year pause on student loan payments, but they are gonna be starting up again in October, and interest on those loans begins accruing in September. And there is so much confusion around all of this, and, you know, where there's confusion, scammers aren't far behind. In fact, BBB is already receiving reports about student loan repayment scams, using the new 2023 guidelines as the trigger.

Now, here's what we've seen so far. You get a call or an email, what have you, out of the blue, from somebody claiming, because of these new guidelines, you're eligible for student loan consolidation, a payment reduction program, some special arrangement. They may even say that they are from the Federal Student Aid department, and they need to verify your identity, or make sure you qualify, as a reason to ask you for your personal information, like your Social Security number, your name and address, even your studentaid.gov login info. Now, once you give them that information, they're going to offer you a really attractive plan to reduce your loan payment. If you agree, you may end up making your payments to the scammers, for months. And with none of your payments going toward your actual student loan, you're going to be in default, which means you could lose eligibility for federal benefits, like repayment plans. You could get cut off from additional federal student aid. You can have tax refunds withheld, or your wages could be garnished to repay the loan. Not to mention, you risk being sued by your loan servicer. And even if you don't make a payment to the scammers, sharing your personal information, of course, puts you at risk for ID theft.

Brian: So Jocile, that sounds terrifying. What should we be doing to make sure this doesn't happen? Does this stuff all appear on the credit bureau reports that we'd be looking at?

Jocile: It could appear there. But first, remember, you never have to pay for help with your federal student aid. Then you need to be proactive. Your loan servicer may have changed during the repayment pause. So, research who your current loan servicer is, and contact them now, to understand what all your repayment options are. You know, one thing you could do also is to enroll in a monthly autopay program, to avoid missed payments or being late on your payments. And there is good news in all of this. There are some legitimate loan relief programs out there. If you've been making income-driven repayments for 20 or more years, and get an email from the Department of Education about loan forgiveness, this could be legitimate. The Department of Education is notifying eligible borrowers right now. The important thing here is that in this email, it will say that you qualify for forgiveness without further action on your part. That's the critical phrase.

Now teachers, can also look into the teacher loan forgiveness program, and people who are working for the government or a nonprofit for 10 or more years, they may be able to apply for the public service loan forgiveness program. There's also a new savings on valuable education, or SAVE plan, which is an income-driven payment plan that can lower your monthly payment amount based on your yearly income and your family size. So, there is some good news out there, but be careful if somebody approaches you out of the blue. Now, I expect also that this [inaudible 00:23:39] be hitting social media really soon. So, social media ads talking about loan forgiveness. Stay clear of those.

Amy: Jocile, it just seems like wherever there is a lot of money changing hands, and also confusion, you're always gonna find scammers there. If you have not been, you know, paying on these loans for several years now, and you're gonna start again this fall, you gotta be clear on who's contacting you. If it's someone you have never heard of before, you need to have the guard up, right?

Jocile: Right. And if somebody's contacting you, stay clear. With the exception of the Department of Education, that I just mentioned. The studentaid.gov is a wealth of information. Contact them. Take the initiative. Don't be responsive.

Brian: If the Department of Education is going to contact me, is it like the IRS, where I should only trust the mail? They're not gonna email me, call me, text me? Is that true?

Jocile: We are hearing that they are emailing.

Amy: Okay. Good to know. All right, Jocile, I wanna switch gears here, because we're getting back into high school sports, school year getting ready to start up. High school sports streaming scams. What the heck is this?

Jocile: Okay. Well, it's football season. And online streaming has made it so you don't have to miss the high school games anymore. Unfortunately, scammers are taking advantage of this too, by fake livestream links, to get you to give them your credit card information.

Amy: Oh, my gosh. Are you kidding me?

Brian: [crosstalk 00:25:07] heading into high school football season [crosstalk 00:25:08]

Jocile: You know, you can't catch a break anymore. If you're interested in this, if you're searching on social media for a link to stream your team's game, and you find a "fans" free streaming link, they may even tag the high school in their post, so you click it. The next screen asks you to sign up for streaming service, so you enter your name and your email, and then they ask for your credit card number, possibly some other personal information. After you put in all that information, you find the streaming link doesn't work. Duh. Not only are you shut out of the game, your credit card and other data might be compromised. Now, your best bet, obviously, is to check with the school to see if it has available streaming options. Some schools host streams for free. Some have pay-per-view streams. Others don't offer live streaming at all. In that case, you're just gonna have to get to those games. If you find a game streaming link from a fan on social media, check their profile before you click the link. If they're only posting streaming links, or they have few followers, that could be a big red flag that this is a scam.

Amy: Am I, like, really behind? I actually had no idea that you could watch streaming high school sports online. Did you know that was a thing, Brian?

Brian: Absolutely. I'm a big football fan. I got a kid in high school, so you betcha. But now I know what to watch for, so thank you, Jocile. I didn't even think this was a thing.

Amy: Of course, right, where there's money...

Jocile: Yeah. Well, I didn't know it was a thing either, Amy. I'm right in your court, but...

Amy: Oh, my gosh. What about QR code scams?

Jocile: You know, [crosstalk 00:26:36] scammers are out there... Oh, the QR code scam. Glad you asked about that. You see more of these QR codes every day. They're everywhere. But since you can't tell what a QR code opens, scammers are using them to trick people into opening phishing websites, fraudulent payment portals, downloads that infect devices with viruses. BBB, we're seeing a couple of different versions of the QR code scam. The first one involves parking meters. I find this interesting. Most of them are taking credit cards these days, but it's not uncommon to see QR codes as a payment option for parking meters. You just scan the code and pay for a few hours of parking. When you get back, you find you've got a parking ticket for not paying the meter, or, even worse, maybe your car's been towed. So, how'd this happen? Con artists easily print QR codes on stickers, and use those stickers to either cover up the real QR code, or they just put a QR code where it makes logical sense on the meter.

Amy: And how would you ever know?

Brian: They don't even have to put skimmers. They don't even... These aren't even plastic mechanical things. This is just a sticker on a... Oh, my gosh. I'm so sad now.

Jocile: It is. It's just that simple. When you scan the fake QR code, it opens a fraudulent payment portal, and it looks exactly like your typical payment portal. There's nothing there that would raise any red flags for you. And the scammers capture, then, your parking fee, your $7 or what have you. And of course, your credit card information. In other versions of the scam, you scan your QR code or you get an email or text, or it's on a flyer, and you're directed to a website that requests personal information. That can lead to identity theft, of course, compromised passwords for online accounts, or downloads that track your activity on the device. Or, maybe you get a notification about suspicious activity on one of your online accounts. There's a QR code to verify your identity, you scan it, fill out the required information. The scammer now has access to your account, and all the money in it.

Amy: Important warnings, right?

Jocile: So, word to the wise. Yeah.

Amy: I mean, these are all things that are super timely. QR codes are everywhere. High school sports, to your point, starting back up. Watch out for those streaming, those games live. And also, student loans, right? Make sure that you are dealing with reputable people reaching out to you about those loans. Great warnings, as always. Spread the word to your friends and family, from Jocile Erlich, from the Cincinnati Better Business Bureau. You're listening to "Simply Money," here on 55KRC, THE talk station.

You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Brian James. If you've got a financial question that's maybe keeping you up at night, there's a red button you can click on while you're listening to the show. It's right there on the iHeart app. Just download the iHeart app, record your question. It's coming straight to us. We'd love to talk about it.

Coming up, how to spot extra fees the next time you're in the market for a car. You could be paying extra and not even know it. We wanna make sure you're not doing that. I wanna say a huge thank you to our producer, Jason Scott, because we are now talking about what is absolutely my favorite thing. Why is it my favorite thing? Well, because health savings accounts are triple tax advantaged. It is a gift from the government. Uncle Sam doesn't usually give gifts like this one, so I'm a really big fan.

Brian: If you're that big of a fan of HSAs, you need bigger hobbies. But that's another topic, for another [crosstalk 00:30:06]

Amy: I'm such a nerd. You're exactly right.

Brian: I'm sure you're fun at the dinner table. But anyway. So, health savings account. Health savings account is, a lot of different impressions of it, but it's a savings account, of course, that has to be tied to a high-deductible health insurance plan. This is something your employer would offer you, that should have a lower premium in exchange for you're gonna take on some of the, some more expenses if you need some healthcare benefits. But that's why there's the HSA, because the idea is you can take those savings and stick them off into this account. And what we love, and the reason Amy loves them so much is because they can be triple tax-free. That means deductible on the way in. If you invest it a certain way and it grows, that won't be taxed. And if it's used for medical expenses, the distributions also will not be taxed. So, this is a good thing. And so, but, and just so everybody knows kind of what the limits are, so, you can only put so much in. $3850 for 2023. That's for an individual only, and $7750 for a family. If you're 55 and older, you can put an extra $1000 in. And make sure you're taking advantage of that.

But the reason we wanna talk about it today is what do you do with this stuff? When it just lands in there? You have to take an extra step, and this is something everybody has to proactively do. If you just plunk it in there, it's probably gonna be in some kind of money market sweep fund that might be paying only a couple percentage points. You have to take an extra step, and it may very well include moving it to a different provider, so you can choose a mutual fund or something else, if it is growth-intended.

Amy: Yeah. So, you want to invest that money. And I wanna make a couple of comments on what you just said, too, Brian, because if you would have never had an HSA, you really have to think through whether a high-deductible plan even makes sense for your family. If there's someone who has a chronic condition, that is medically very expensive year-over-year, you probably do not want a high-deductible plan. But if everyone's relatively healthy, you're not expecting any major surgeries, and of course, anything can come up. You never know, but if normally, everyone's pretty okay, then a high-deductible plan can make a lot of sense for you. We have been using it in our family for years. Here's another thing that we do. We put extra money into our emergency fund, so that when the bills do come, and they inevitably do, someone breaks something, or we need X-rays for something, whatever it is, we try to pay that money out of our emergency fund. Why wouldn't we touch the health savings account? Because that's what it's there for, because we often also talk about, on the show, how expensive it is for healthcare in retirement. Those medical expenses can be just insanely expensive. So, what I do is put the money into the HSA. That money is invested. I try to pay the medical bills out of pocket now, and I just keep sending that money forward as it grows, so that it's there when we retire. At some point, we might have to tap it a little bit, right? You never know. But at least for us, it's working.

Brian: So, what you're doing there, and I like that idea. That's what I would do. You're simply taking advantage of the tax code the way it is designed. So, this debate is really a question between if, do I feel like I need health expenses now? I have to cover them now, and therefore I wanna make those tax-deductible? That could be the case. If you've got serious health problems and not a lot of resources to pay for it, then this might be a good plan. Most people are attracted to this, though, because of the tax benefits. So, Amy, what you're doing is you're using it as a tax planning technique, where you're putting the money in, before tax, you have no intention of using it, although you could. If things really, truly hit the skids, you could get to those dollars...

Amy: Absolutely.

Brian: ...but you prefer not to, because now you're taking advantage of the time. So, question came up recently of, this is for healthcare, and that's a big, important thing, so I probably shouldn't put this at risk. Well, that's logical thinking, but at the same time, if you've got the wherewithal to pay for those health expenses with other resources before you touch the HSA, then that gives you the opportunity to take advantages of the tax planning opportunities that that provides. And there are fewer and fewer opportunities like that these days.

Amy: Well, and I think HSAs also, as they've become more and more popular and more people are talking about them, you do have more investing options, likely through the plan that your employer offers you. Just make sure you're taking all the steps, so you're taking as much advantage of that account as you possibly can. Here's the Allworth advice. It's always a good idea to get an opinion from a qualified financial planner, but an HSA could be a great planning tool for you and your family, whether you use it now for medical expenses, or in the future.

Coming up next, hidden fees you need to be aware of when you're shopping for a car. You're listening to "Simply Money" here on 55KRC, THE talk station.

You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Brian James. We bought a car recently. Used car. But, I go over that invoice with a fine-tooth comb. Of course I do. We've already established I'm kind of a nerd about these things. But it can be really easy...

Brian: You know.

Amy: Yeah, I know. It can be really easy to buy a car, and hidden fees are just shoved on there, and you have no idea that you're even paying them.

Brian: Yeah. So, this reminds me, there's a great movie that came out in the '90s called "Fargo," and it's one of my all-time favorite movies...

Amy: Oh, my gosh. Yeah.

Brian: ...and in one of the very opening scenes, William H. Macy is trying to sell a car to somebody, and they're arguing about this "True-Coat" coating something or other they're supposed to put on the bottom. The customer doesn't want it on there, doesn't wanna pay for it, so he says he's gonna go ask for permission from his manager. Goes into his manager's office and doesn't talk at all about removing the True-Coat, because they have no intention of doing it. This is how they make money, beyond the markup on the car itself, which you have to expect. They have to make profit somehow.

Amy: Of course.

Brian: But they're adding on, you know, nitrogen in the tires, window tinting, chrome-plated wheels, all-season floor mats, wheel locks, you know, all kinds of bells and whistles. You may or may not want them, but you may have to fight to get them to removed from the purchase. So, consumer watchdogs are out there making sure that people are paying attention to these things, and they're actually pushing for the Federal Trade Commission to put some rules in place, to say all these extra fees have to be included in the upfront price. It can't come up while you're sitting in the finance office, and they say, "Oh, by the way, we have to add this, this, and this." That is never the case.

Amy: Well, and can you negotiate these fees, right? I think the key is understanding if they're on there, and what they are. And I'm a big fan of, when you're buying a car, focus on the out-the-door cost, like, the entire amount, versus what the monthly payment is gonna be. Because they're gonna try to just get that monthly payment down as much as they can, and, you know, extend it out over the next 10 years of you paying for that, right? So, if you're focusing on the total cost, then you're looking at the itemized amount of, "What's this, what's that?" When we just bought the car, they had all these extra things that you could add on. We said "No, no, no, no, no," except for the wheel protection and the tire protection, because I'm a horrible driver, and I hit curbs all the time. So that actually made sense...

Brian: That's a well-thought-out decision. Here's a risky space, that, you know, [crosstalk 00:36:36]

Amy: [crosstalk 00:36:36] We were like, "You're not actually gonna make any extra money on this, on us, because we're gonna take you up on this really [inaudible 00:36:42] But there's a lot of things...

Brian: Get my money's worth out of [crosstalk 00:36:44]

Amy: Exactly. I'm gonna get my money's worth out of that. But there's a lot of times when you're not gonna get your money's worth [inaudible 00:36:49] And they've even pointed out, they'll sometimes charge you an extra fee to clean that car before you take it home. Do not pay for that. That is craziness. So, make sure you are on top of this.

Thanks for listening tonight. We hope you're gonna tune in tomorrow. We're talking about key questions you need to make sure that you're asking your financial advisor. You've been listening to "Simply Money," presented by Allworth Financial here on 55KRC. We are THE talk station.