Amy: Tonight, is the Fed finally setting the stage for a possible interest rate cut? We're taking a deep dive into election stress and your money, and we're talking about the mindset that you need if you want financial freedom. You are listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with the one and only Steve Sprovach in for Steve Hruby. It's like all-star. We've gone "Simply Money."

Steve S.: It's like déjà vu all over again.

Amy: Yeah, we had Ed Fink, right? The original founder of "Simply Money" in the show yesterday, and now Steve Sprovach coming out of retirement...

Steve S.: Exactly.

Amy: ...for us.

Steve S.: My schedule's been pretty busy, but I was able to squeeze out a little bit of time for tonight.

Amy: Our people called your people.

Steve S.: Exactly.

Amy: We made something work out. And we knew we wanted you in this week because you haven't been gone for so long that we didn't spend day after day talking about the Federal Reserve, our nation's Central Bank, in their quest to bring down inflation by raising interest rates. We saw 11 interest rate hikes over the past couple of years, and now yesterday, Fed met, Jerome Powell talking, and maybe starts to project out into the world the fact that next month we could be looking at a cut.

Steve S.: Wait, we're talking about inflation and interest rates again? That's where I left off. I retire in December. We are talking about inflation and interest rates.

Amy: What's this? Like, "Sleeping Beauty" or whatever, where it's like you fall asleep and you wake up and, like, nothing has changed, whatever that is from Fran Winkle? Whatever that is, that's where we are now.

Steve S.: But you know it's important stuff because inflation just...you wanna talk about what kills a retirement plan, I mean, not overnight.

Amy: A budget, a retirement plan.

Steve S.: It's the silent killer. Yeah. And now me being in that boat, I am absolutely aware of this stuff. I mean, if you take a look at gas prices, take a look at... I don't do the grocery shopping. You know my wife doesn't let me to, because...

Amy: You're banned from the store.

Steve S.: That last 10 feet in front of the register is my sweet spot.

Amy: All the candy.

Steve S.: Yeah, it's what I do. But no, in all seriousness, inflation is what kills a retirement plan because you're looking at... If you're on a pension, corporate pensions don't increase. I mean, it's the same amount of money, but you're buying less and less every year. And it might not seem like a big change, but when Anne goes grocery shopping, she comes back aggravated every time because she'll say things like, "Oh, I bought this. It was $9 and, you know what, a month ago, I paid $3.50 for it." You know, stuff like that. And that's just one example that the grocery bills have gotten absolutely crazy. And if you let it get out of control, this is nothing. I mean, it could get worse and worse and worse.

Back in the mid-'70s, I remember when this stuff happened because I'm old, and I remember the '70s. By the way, if you remember the '60s, you weren't really there. But in the '70s, the exact same thing happened and it got out of control. And Alan Greenspan at the time was head of the Federal Reserve and he jumped the gun and cut interest rates a little bit too early. And that's why Jerome Powell is very, very cautious because when Greenspan cut rates too soon, too quickly, guess what? Inflation came right back roaring worse than it was the first time, and they had a much harder time getting inflation back in check when they readdressed interest rates. So this is a big deal. And the Fed's doing its job.

Amy: Well, we've looked at 9%, right, inflation, and we're running around pulling out our hair like it's on fire because it hurts. You're talking about the grocery store. I went to the grocery store last week. It was, like, midweek. I picked up a handful of things. A handful of things that were $70. And I was like, "Did I scan something twice?" Like, "What's going on here?" This is what we've been dealing with. But to your point, Alan Greenspan, like, people had double-digit inflation that they were dealing with during that time. I mean, you talk about... You know, Ed Fink on the show yesterday, his mortgage was 14%.

Steve S.: I had an 11% back in 1984, I guess it was.

Amy: Right. You know, so we're upset about a 7% mortgage rate right now. You know, and I just think that perspective is sort of good to keep in mind.

Steve S.: But we should be upset about a 7% interest rate. And, you know, the question is a lot of people just don't, you know, realize why would interest rates be this high? It's intentional. The Federal Reserve, their primary tool that they use is controlling interest rates. So they set interest rates high to slow the economy down, to bring prices down. It's just not that simple. This is a huge economy, and it's not like, "Okay, we're gonna flip the switch on and increase interest rates and that'll slow the economy to 2% in three months." I wish it were that easy, you know, but it's not. And here we are, a year and a half to... They're not using the word "transitory." Did you notice that?

Amy: They're using the word normalizing.

Steve S.: Yeah, exactly.

Amy: That is the word that Jerome Powell is using right now when he is talking about the economy. He used it over and over again when he was talking yesterday, referring to the labor market. You know, we sort of had this place that we've been in for the past couple of years, where the normal expectation would be that as you raise interest rates that the labor market seizes up, right? The cost of borrowing money for these businesses becomes more expensive, then you've gotta let something go. And then the question is, you know, your workforce gets smaller and smaller, and then the cycle begins. You're worried about your job, so you're spending less, and then those companies are making less, right? That's the cycle that we would have expected.

The interesting thing that happened is that the Federal Reserve started raising interest rates and the labor market was, like, going gangbusters. It was like, "Who's talking about interest rates? We don't care." We're starting to see some softening that you would expect to see.

And, you know, I wanna get your take on this too, because this is something that you and I talked about a lot when you were on the show, especially during the pandemic, was the savings rate during the pandemic for consumers was 30-plus percent.

Steve S.: Yeah. We knew that wasn't gonna last. There's no way. We're Americans, dang it.

Amy: I told you that one wasn't gonna last, but now we have seen. The latest numbers I've seen, 3.6%. Yikes. And all the data that we look at, that's the one that has me maybe the most worried. We've run out of savings, people. Like, there's, you know, that stimulus money that we had on the sidelines. And so I think, you know, there's maybe more people trying to get back into the labor market now. I mean, just that extra sugar that we had in the economy, it's all burned up now.

Steve S.: Well, the pendulum always swings, and it usually swings too far in any direction. I don't care if you're talking about politics, economics, whatever the case is. And I know that, okay, during the pandemic, a lot of especially younger people got used to remote working. I know my younger son, he's got three young kids, his wife works, she's the school nurse. So other than during the summer, it's a hassle when you have kids that are still at home and both parents work. So, you know, when the labor market was super, super tight, they could demand, I'm gonna continue working at home even though the pandemic's over, okay? Well, you know what? The employers had to put up with that because, you know, it was such a tight market.

Amy: They could go somewhere else.

Steve S.: Exactly. And if you wanna keep quality workers, you kind of have to give them what they want. That's changing. I know in his case, his employer said, "Next year, five-day work weeks in office." And that's starting to happen because it's healthier for the workplace, in my opinion, but companies know where they can get productivity to be increased, and that's generally having everybody together, sharing ideas, and working as a team.

Amy: You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Steve Sprovach in for Steve Hruby tonight with his take on the Federal Reserve. Okay. So no rate cuts yesterday. Nothing surprising there.

Steve S.: No.

Amy: What's your take though? And it seems like Powell is starting to say...and he knows not to get ahead of himself. He's learned that lesson the hard way, but I think he is opening the door for the real probability of a rate cut next month.

Steve S.: You know, this is interesting because about this time last year, Powell was saying, you know, "Sometime in the summer of '24, we're probably gonna have to start thinking about cutting rates." Yet, all of Wall Street said, you know, by December, "Oh, they're gonna cut in January. I know they're gonna cut in January." And the bond market takes off because the whole idea is if you know interest rates are gonna drop, well, let's buy something that pays us the higher interest rate while interest rates are high and lock that rate in. I mean, you wanna earn high interest for a long period. How many people in the early '80s would love to have that 10% tax-free municipal bond, or the 12% CD locked in for 20 years? You know, I mean, but they didn't. And people are saying, "I'm not gonna let that happen again," so they wanna lock in rates.

And as soon as the interest rate talk is the Fed's gonna reduce rates, everybody jumps on the bandwagon saying, "Yeah, you're probably right. They are gonna reduce them in January." Powell, every single time, would come out in his comments and say, "No, I never said that. You guys need to have a little bit of patience." You know, he's doing exactly what he said he was gonna do. And he said, sometime around summer of '24, guess what? It's the summer of '24 and he's saying, "Yeah, maybe by September we'll do this. We'll drop."

Amy: Yeah. And, you know, I think the markets have just been kind of sticking their fingers in their ears like, "We don't wanna hear what you wanna hear. Here's what we wanna see."

Steve S.: Here's what we really think he's gonna do.

Amy: But yeah, in December, they were saying, you know, seven cuts this year. Okay, we're coming up, we're talking about the September meeting now and that would be the first cut that we see. I think we also understand that what the Federal Reserve would like to do if they're going to look at cuts is a quarter-point cut, like, kind of ease into this. But we also know that they are taking in more economic data than you and I can begin to fathom, reams and reams of information.

Steve S.: And still that's not good enough. The same people had said, you know, 7 or 20 or 30 rate cuts this year. As soon as he came out and said, "Yeah, we may talk about this in September, we may be ready for a rate cut," they were saying, "Oh, it's gonna be half a point. It's gonna be three-quarters of a point." You know, the guy from Deutsche Bank, I mean, this is one of the...it might be the largest bank in the world. These people know what they're talking about. He's saying, "Oh, they're gonna cut rates, you know, left and right." Really, why don't you listen to the guy who's actually cutting rates? He might be the one you wanna pay attention to.

Amy: And I think here comes the headlines to your point. Here come the headlines and the predictions. I actually saw a headline in MarketWatch the other day, and it said...it had some bold prediction. I can't even remember what the prediction was. But then right beneath that, it said, "And this strategist has been right more than they've been wrong this year." And I thought, "Oh, that's now the threshold that we're gonna hold people to?"

Steve S.: Fifty-one percent.

Amy: Yeah. He said one more right thing than wrong thing this year so we should listen to him? Like, no.

Steve S.: But we do know they're gonna cut rates and it's probably gonna begin sooner than later.

Amy: I agree.

Steve S.: Because that's what Powell said. So what do you do about it? Okay? One of my favorite credit unions, not to be naming names, but they happen to make aircraft engines. You can get a six-month CD, 4.5%. You wanna lock it in longer, okay, go a year, 4.7%. Historically, these are good interest rates. Three years, back down to 4%. Why? Because the banks and credit unions know rates will be lower and they don't wanna lock in. They make their money making the difference between what they pay you and what they receive on interest rates on loans that they make. So they don't wanna lock in anything at a very high rate for a long period of time. But this is when you might start thinking about, "I've got some money in an emergency fund, I don't need for a period of time. I wouldn't necessarily do just 3 or 6 months, maybe think about a year, 18 months.

Amy: The interesting thing about the point that you're making about, you know, lending institutions, banks, and credit unions is the fact that when we saw interest rates start to go up, very slowly did the money that you were making in those high-yield savings account, you know. And it's like now even in anticipation for the first cut, we're starting to see things lower. So take advantage of this now. If you have not already and you have an emergency fund money on the sidelines, look at a CD, look at a high-yield savings account wherever you can to make that money because it is not going to stick around for a long time these rates that we're seeing.

Here's the Allworth advice. You can only control what you can control, so make money off of these current interest rates while you can. Coming up next, we're talking about one thing investors aren't great at doing as we get closer to the election. We'll get into that.

You're listening to "Simply Money," presented by Allworth Financial here on 55KRC, THE Talk Station. I'm Amy Wagner, along with Steve Sprovach. If you can't catch our show every night, you do not have to miss a thing. You can subscribe and get our daily podcast. Just search "Simply Money." It's on the iHeart app or wherever you get your podcast. Coming up at 6:43, when it comes to your money, your mindset matters. We'll talk about that. Okay, who hasn't been...have you been watching the Olympics lately?

Steve S.: Heck, yeah.

Amy: Yes.

Steve S.: Can't watch the Reds. They're driving me nuts.

Amy: That's a really good point. It's so funny. I was just saying this to my son last night. I was like, "Most of these sports, I never watch." Like, not that they're not interesting or exciting, they're just not appointment TV for me. And then the Olympics come on and you get so, like, sucked into these people's stories.

Steve S.: Can't wait for break dancing,

Amy: Yeah, break dancing. I was like, "Surfing is now an Olympic sport." Like, I mean, we are all in on our house, but here's one thing we're not doing. We're not changing how we're invested based on the Olympics and how Team USA is doing. But the crazy thing is...

Steve S.: Some people are.

Amy: Yeah. There has been...

Steve S.: Crazy.

Amy: ...research done that shows, hey, the global stock market moves sometimes when we have these major global sports competitions.

Steve S.: So there was an article in "The Journal of Finance," which I read every day, I'm sure you do too, in 2007, putting together a correlation between buying and selling and which countries won gold and which countries didn't. 2007, okay? So MarketWatch, which I like, MarketWatch, I do read all the time. They found that since that original article came out, there have been 1,500 studies on correlations between Olympics outcome, sports outcomes, and the stock market. These people have too much time on their hands, you know, seriously. You can make a correlation for anything in one direction or another. I'm absolutely convinced of it. But what they claim to have found is that, yeah, when your country loses, you tend to have people in that country sell their stocks.

Amy: Which is crazy when I hear that.

Steve S.: I'm depressed. We didn't get gold. Cash me out.

Amy: Yes.

Steve S.: Come on. Come on.

Amy: I love the women's gymnastics team. I love the, you know, basketball, all the things we've been watching, but I can't imagine being so upset if they don't do well that I'm actually changing my investments based on that.

Steve S.: If you're doing that, you're not an investor, and you're not gonna be a successful investor, that's for sure, because you're finding reasons to sell or buy. No, that doesn't get you anywhere, but people are doing it.

Amy: Speaking of the Olympics and gold medals, if you're wondering how much those medals are worth, well, actually, probably not as much as you think. They're not. Like, that gold medal isn't pure gold. If it was, it would actually be worth more than, like, $50,000. But that's not where we are here.

Steve S.: No. And the next thing you're gonna tell me is a penny isn't really solid copper, right? Come on, don't pass my brother.

Amy: Sorry.

Steve S.: No, but I mean, you know, gold's up to $2,500 an ounce. I don't know if you realize that. It's quite a bit over the past year to two years or so. But they're only gold-plated. There's only a couple of grams of gold. So, I mean, the actual value of a gold medal, if it was solid gold, would be, you know, $45 grand, which is probably 1 year of gym class for those gymnastic kids. You know, I mean, it's crazy the money and time and commitment that they put into being the best in the world. So God love them. But, you know, you're not getting payback through the gold because the actual 6 grams of gold that's in a gold medal, yeah, worth maybe 1,000 bucks total when you add it all up.

Amy: And my son and I actually, we were at dinner last night, we were talking about how much do you make? Like, do you get paid when you win a medal? And so he looked it up and it was like, for a gold medal, the U.S. Olympic Committee gives you $37,000, something right around there.

Steve S.: Do they really?

Amy: Yeah.

Steve S.: Okay.

Amy: So I don't know, for team sports, you have to...or each person gets that.

Steve S.: Oh, interesting.

Amy: I don't know how that works, but to your point, think about how much time and energy and training and money has gone into these things. You know, I think that's why we all get so captivated by the Olympics. And of course, in my house, we will continue to be watching. We will not be buying or selling stocks based on what happens, but we will be tuning in.

Speaking of, you know, stress and maybe doing something based on what's going on, how about the upcoming election? You're probably not sad to be sitting this year out as an advisor or your first year in retirement because you know those calls are gonna be coming from clients who are like, "Oh, your four favorite words." This time is different. This election feels different.

Steve S.: And, you know, this is no surprise. People are scared, and depending on which side of the political ledger you fall on, you're either gonna be really happy November 5th or really upset November 5th. I remember when Trump got elected, obviously if you weren't a Trump fan, you weren't happy, okay? And I had a couple of clients call me just out of their gourds scared, the world's gonna end, this, that, and the other thing, cash me out, okay? And my job when I was working was in part, you know, keep people from doing things that are gonna hurt themselves financially in the long run.

Amy: Yeah. That they can't recover from.

Steve S.: Yeah. And, you know, maybe, you know, skeptics out there will say, "Well, you just wanna keep the money." Well, no, you know, what happens, happens. It's really keeping people from making mistakes. Just like when COVID hit, there were people that cashed out, and by the time they got back in, that loss was locked in and they never regained it or took years and years for them to regain the loss. So, you know, we saw that happen with Trump, and people cashed out because they weren't happy with it. And whoever gets elected this time around, you know, there are gonna be people that overreact. But you know what, the numbers are starting to finally make a little bit of sense, where fewer and fewer people are making rash decisions based on whether their guy or woman got in the White House or didn't.

Amy: So this is according to an online brokerage survey by Public, 7 in 10 said, "Hey, this election year, regardless of how I feel about it, it's not going to impact my investment strategy." Thank you. Thank you. Thank you.

Steve S.: Or maybe it's us.

Amy: Maybe they're listening to us. Yes, because it's...

Steve S.: It would be 10 out of 10 "Simply Money" listeners.

Amy: A thousand percent. It better be because I think we've been beating this drum for so long of, listen, you be as passionate as you want to be about your politics. I don't care if you're knocking on doors and sending out mailers and talking to everyone and posting about it all over your social media, if you are making financial decisions based on that, that's where you go wrong.

Here's the Allworth advice. Remember, there are a lot of factors that play into the performance of your portfolio. Politics is just one of them. And it's actually a very small one. Coming up next, when you are retired, like Sprovach is, you've got the opportunity to do lots of traveling. We've got some travel hacks for anyone out there who's listening. You're listening to "Simply Money," presented by Allworth Financial here on 55KRC, THE Talk Station.

You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Steve Hruby. Research out there shows that about a third of all couples have some sort of financial infidelity going on, whether it's a credit card, someone doesn't know about some purchases, right? It can run the spectrum. But tonight, our good friend Al Riddick from Game Time Budgeting, the man who was more meticulous about money than anyone I have ever met in my life, claims that maybe he could be guilty of financial infidelity. Tell me, Mr. Riddick, what'd you do with that 50 cents? Because I don't believe it was any more than that, my friends.

Al: So you two may recall that my wife and I, we pay ourselves a monthly allowance, which is considered our fun money for the month. So our agreement is that neither spouse can comment on how the other spouse uses that money. So recently, I noticed that my wife's automatic transfer from the joint account to her personal account, it had not been made. So since that's her personal money, I didn't say anything because technically, it was none of my business, right? So then I thought to myself, I said, "You know, it might be kind of intriguing just to see how long it would take her to notice she was missing her allowance." Now, to my surprise, it took 36 days. So then I began to wonder, because I was withholding the truth, right, did I commit financial infidelity?

Steve H.: I'm sorry, you did.

Al: I was about to throw that question back to you too.

Amy: We're throwing the flag right here, right now.

Steve H.: Yeah, 10-yard penalty. I think that qualifies.

Al: That qualifies?

Amy: You totally used your wife as a research project.

Steve H.: You did.

Amy: You know, you were like, "I'm going to see if she realizes." So let's take a little more deeply into it. Is it that she just didn't have the money earmarked for anything that month? Did she have plenty in her account already and just didn't miss it? Like, what's going on here?

Al: Yeah. So yes, and yes, she didn't really have anything that she wanted to purchase. Plus, I think that she has quite a bit of money in her account in addition to that. I kind of think that both of our allowances are kind of on the high end, but, you know, that's a story for another time, right? But the funny thing that happened, and I'll never forget this day, so I'm sitting in her office because she works at home, so she has a desk facing one wall, and when I decide to work at home, I have a desk facing the other wall.

So all of a sudden I hear her say, she said, "My money is getting kind of low," right? And then the next minute she says, "Wait a minute, I didn't get my allowance this month." And then she said, "Hold up. I didn't get it last month either," because keep in mind, it took 36 days, right? So I turned around and I just burst out laughing because I was like, "Oh, my gosh, I could not believe it took you this long to figure out you did not get your money." So of course, we had a good laugh about it, but in the end, she did.

Amy: Did she laugh at you when you knew that she was two months behind? Was she laughing?

Al: Well, she said, "I can't believe you didn't tell me." And then I said, "Well, the agreement," like I said earlier, "is that we can't say anything about how each other spends that money. So technically, it was none of my business."

Amy: Technicality.

Steve H.: Such a literal interpretation of the rules.

Amy: I would have been like, "Okay, when we both work from home, my desk is in this room and your desk is outside in the yard for a few days, Mr. Riddick." But first of all, was there some kind of a glitch? What happened that she wasn't getting her money?

Al: So this is what we assume happened. Like, at the end of every year when we're talking about our plans for the next 12 months, we set up various transfers that occur every month so we don't have to think about it, right? So I'm assuming, and she assumes this as well, when she set up her automatic transfer to her personal account, she must have selected a date that ended too early, or maybe she just selected just do this for two months and that's it. So of course, you know, we did laugh about it, but I just thought it was hilarious because I conducted my own little experiment, you know.

Steve H.: Any other emotions outside of humor that your wife felt after you explained that she was kind of an experiment?

Al: You know, she did not get upset with me because...

Steve H.: Good for you.

Amy: She's a good sport.

Al: Yeah, she's been with me for so long. She understands how I am and how intrigued I am by different financial situations. So she was cool with it. And even the other day, matter of fact, it was yesterday, she was just walking around the house, and then all of a sudden she said, "Ow." So I thought she needed me to do something. Then she said, "I'm counting my money, just so you know." I was like, "Okay, that's good."

Amy: I wanna meet your wife someday. Such a good sport. You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Steve Hruby, as one of our favorite people, our good friend, Al Riddick from Game Time Budgeting, joins us tonight, joking that he realized that his wife's sort of fun money was not put into her account as they have kind of set that up. And he sort of had a little experiment to see how long it took her to realize that.

You know, I wanna back up from this a little bit more because there's no one that I have ever met who is more intentional with their money than you and your wife. Talk briefly about the fact that you do annual meetings with financial goals, you do monthly meetings, and that you really make sure that every single dime, every single penny that's coming into that home is put to good use.

Al: Yes, ma'am. So this is something that we've been doing, heck, I've been married now 21 years, so going on 22 as soon as my next anniversary hits. But every year, we sit down and we talk about some of the goals that we have for the next year, and then we just start planning how to make those goals happen. Because as you two both know, it takes money to get anything done these days, right? So once we set, like, what that big goal is and attach a dollar value to it, then we just start stashing money in different areas to make sure that we can pay for some of these things, well, really everything in cash by the time the due date rolls around, so to speak.

So, as an example, I think I may have mentioned in another show that because we're having a big birthday this year, we wanted to spend more money. So of course, I started planning a long time ago because when my wife tells me she wants to do something big, I already know that's gonna be a lot of dollars, right?

Amy: It's gonna be big.

Al: Exactly. So I just started funneling more money to the vacation account. So now the latest thing is that she wants to remodel the bathroom. So once I figure out what her vision is, then, of course, we'll figure out how to make the money match the vision. But in addition to those, like, annual year-end reviews, we also just plan how the money will behave every month. And because we've been married for so long and we realize what we enjoy as a couple, you know, we kind of do the same things over and over. Like most people, you know, we love to travel, we love going to shows, we like going to plays, we like outdoor jazz concerts and things of that nature.

So we just always make sure that we stay ahead of any events that may be coming through town so that we can go ahead and build it into the budget instead of waiting to like a week before a specific event and then trying to find the money. Because typically, nothing really works out well when you are in a crisis mode with money. Is that making sense?

Amy: It makes a lot of sense.

Steve H.: So as a result of this experiment, were you able to successfully lower your wife's allowance?

Al: No, I was not. Yeah, that wasn't even a thought that would cross my mind.

Amy: Not even on the radar.

Al: But you know what? I did learn. Remember back in the day when we had the conversation about my wife wanted to increase her allowance? That experiment let me know that she didn't really need the extra money, she just wanted it because it would be nice. So I'm like, "Hey, whatever works for you," you know.

Amy: We learn so much from you and the way that you and your wife budget, and I'm telling you, if anyone is ever behind the eight ball, like you live and you give your money a job the way that you guys have, and then you can get yourself out of any situation. We always appreciate your insights, my friend. You're listening to "Simply Money," presented by Allworth Financial here on 55KRC, THE Talk Station.

You're listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Steve Sprovach filling in for Steve Hruby tonight. If you've got a financial question keeping you up at night, we can help you out. There's a red button you can click on while you're listening to the show right there on the iHeart app, record your question. It's coming to us. You know, Steve, earlier in the show, we've talked about the Federal Reserve, we've talked about inflation, we've talked about politics, but when it comes down to money, what it really comes down to is being a smart, long-term investor, ignoring the headlines, ignoring the noise, ignoring the anxiety, and all of those feelings, and really just staying put. And if you can have the right mindset, it really does make all the difference.

Steve S.: It does, but, you know, if you didn't grow up with this like me and your parents didn't teach you any financial lessons like me, you don't know how to get started. And the first thing you are gonna think is, "I don't have enough money to invest. I'm not like those rich people. I don't have a stockbroker. I don't have an investment advisor." Where do you even get started? And unfortunately, a lot of people say, "Okay, I'm out," at that point. But if you've got 50 bucks, are you gonna go out to dinner with your spouse and spend 50 bucks? That's enough to get started investing, especially in mutual funds and exchange-traded funds. So it doesn't take a lot of money to get started. It takes a mental jump to get started.

Amy: And once you make that mental jump to you've started investing and then you give it time, and all of a sudden you check that account and you start to see, like, wait a second, there's some real money. This account is growing, it's compounding, it's doing what it's supposed to do. Now listen, it will go down. There are times when it will go down. That's a normal part of a healthy part of the economic cycle. But, man, all of a sudden you're like, "Yes, I am an investor now," you know. And now it doesn't mean you have to make a six-figure salary. It doesn't mean you have to have stockbrokers at your beck and call, but it does mean that you are putting money into that 401(k). You're getting that company match, right? You are an investor when you start to take steps like that.

Steve S.: But, you know, there are so many people, mainly in our business, in the media, you know, the get-rich-quick schemes. You know, here's, you know, the Jim Cramers of the world saying, "You gotta bet on this. You gotta bet on that." Betting is not investing. I mean, it's not investing. And this is the way the really wealthy people did it. Yeah, there might be a couple that bought Apple in the early stages, but the vast majority of people, they attacked investing just like you attack getting out of debt, okay?

If you're gonna pay off a credit card that you just let get out of hand, it's gonna take some time and you just keep doing it. You forget about it. Every month you put the same amount of money against that balance. And you look at it a year later and it's almost paid off. It's the same with investing. Don't look at it every day. Just keep doing the same thing. Set that money aside first, whether it's 50 bucks, 25 bucks, or 100 bucks a month, whatever it is, set that money aside first. Don't wait to see, do I have anything left over at the end of the month? And that's what I'll invest. That's a losing mentality.

Amy: Yeah. I like the mindset of investing first, and then also, you know, not trying to get rich quick. We have a good friend, we were with him earlier this summer at the lake. He's 10 years older than us, so he'll retire in the next...and he'll retire young too. He'll retire in the next, you know, five, seven years, something like that. And he said, "You know what?" He said, "It's like the tortoise and the hare." And he said, "I've seen so many people try to be the hare, try to figure out the quickest way." And he said, "I have been the tortoise. I have just slowly socked away money. I have been investing since my 20s." And he said, "And it has worked out well for me." And I thought, "Gosh, what a great way to think about that." You know, the tortoise and the hare doesn't sound sexy, doesn't sound exciting, but if you do that mindset shift to slow and steady investing, you're gonna be able to cross that finish line.

Steve S.: Wait, you bring up a good point because a lot of people, especially if you get started late...I got started late. I just had to, you know, bear down and put a lot more money away than if I had got started early. But, you know, they say, "Well, okay, when I win the lottery." Okay. And I heard that from my parents. I've heard it from a lot of people over the course of my life. That's not a financial plan, winning the lottery. It really isn't.

Amy: I'll tell you what else is in the financial plan next year. I'll start next year. We're going on this big trip this summer and so the money is going toward that.

Steve S.: There's a reason.

Amy: Yeah. This expensive thing.

Steve S.: When the kids get out of college.

Amy: Yep.

Steve S.: Right? When the kids get out of college. You know, there's always a reason that you have to wait to do something. Just change that mentality. Change that perspective. Start today putting some money away. And don't forget the emergency fund, because if you start putting money away in investments and you need an expensive repair on your car and that causes you to have to sell your investments, you're not getting anywhere. Matter of fact, it might have hurt you compared to if you had an emergency fund sitting in savings earning, you know, 1% or 2%, but at least it's there for the emergency.

Amy: And there are so many mindsets that are negative and so many people who say, "Well, I don't even know where to get started, so I'm just not going to get started." You know, you touched on this earlier, but it's like, what should I even invest in? Just be diversified. Don't try to figure out the next Nvidia or the next Apple. That's not the answer. The answer is being diversified and making sure... You know, it's really not even the S&P 500, the Russell 2000 is doing better right now, 2,000 companies.

Steve S.: Wouldn't it be great if there were some way that you could buy, let's just say the 500 biggest U.S. companies without having to spend a ton of money and, you know, even just 50 bucks?

Amy: All these fees. Yeah.

Steve S.: Oh, wait a second. There is, they're called mutual funds and exchange-traded funds, where you can buy...

Amy: S&P 500.

Steve S.: ...the 500 largest U.S. companies, the 2,000 largest companies. Yeah. Talk to an advisor, but get started.

Amy: Here's the Allworth advice. If you want financial freedom, you might need to change how you think about money, but when you do, it will really pay off. Coming up next, we've got some final thoughts with our friend Steve Sprovach while he is in the studio with us. You're listening to "Simply Money," presented by Allworth Financial here on 55KRC, THE Talk Station.

You are listening to "Simply Money," presented by Allworth Financial. I'm Amy Wagner, along with Steve Sprovach joining us in the studio tonight. You just said, "Okay, what are we gonna talk about next?" And I said, "I'm just gonna ask you questions."

Steve S.: No anxiety there. Yeah. Now I'm scared.

Amy: Steve is flying blind right now, and I'm just gonna ask you a series of questions. What's the best thing about being retired?

Steve S.: Yeah. You know, it's like a vacation that doesn't end. I actually found myself, because I retired at the end of the year, December, 42 years. That was a good run, okay?

Amy: Yeah. That was a great run.

Steve S.: But, you know, it was like I found myself actually Sunday night starting to get anxious about what I've got to get started for work the next day. Wait a second. I don't have to go, and the next day I don't have to. So I'm finding that I'm doing things I want to. I'm not sleeping until noon. You know, I'm getting to things that I've wanted to do, but that stupid four-letter word kept getting in the way.

Amy: Work.

Steve S.: Work. Yeah. Exactly.

Amy: What's the, I'm not gonna say worst thing about retirement, but if there was anything about it that you would say, "Okay, I don't love this aspect of it." You got anything for me?

Steve S.: No, it's pretty awesome. I recommend it highly. But, you know, the reason I'm comfortable is, and I hate to keep saying, you know, financial planning, financial planning, but I was updating my financial plan every month for the last year, okay? Because I saw my dad run out of money in two years. I mean, literally, the only money he had coming in from age 60, around 2 years after he retired, he would have been 64, from 64 till he passed at 84 was I think $110 pension and $1,100 of Social Security. No savings, nothing. That was it. That was his world, okay?

So I obviously didn't want that to happen to me. And so I was awful anxious about retirement. Did I include this in my plan? Did I include that? I haven't looked at my plan since. I know it's doing okay. You know, the market's okay. And if the market weren't doing okay, I know it would become okay. I have not worried about money whatsoever, and it's not because I've got $10 million in the bank, because I don't. I'm not even close.

Amy: Well, okay, so there's the financial component to retiring and retiring well, but there's also a social and emotional one. I joked with you as you were retiring that you have more hobbies than anyone I've ever met in my life. Roughly 5,372 of them. How has that transition been from the 9 to 5, and you were, like, in the office even during the pandemic every single day to not coming in? How has that transition been?

Steve S.: Yeah, it took a little bit of time to get used to what my day was like, but I do the fun stuff and the work stuff, the honey-do list, and whatnot. If I got to today, great. If I got through half of it today, great. There's always tomorrow. I never... You know, it was always on weekends that you had to do stuff. You had to cram it in after supper or on weekends. And no, you get to it when you get to it. Again, I recommend retirement highly.

Amy: You know, we were talking before about having the right money mindset. For those who are putting it off, I hope that you're listening really closely to Steve right now in how great retirement is for him, right? We can all have this. It just comes down to planning. Thanks for listening tonight. You've been listening to "Simply Money," presented by Allworth Financial here on 55KRC, THE Talk Station.