SMPL Money

All About Refinancing

Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David provide an in-depth look at mortgage refinancing, covering when it makes sense to refinance, common mistakes to avoid, and how refinancing can impact your long-term financial goals. They discuss real-world scenarios to illustrate how refinancing can save money and improve cash flow, while also cautioning against common pitfalls such as extending the loan term without evaluating costs and the total interest paid.
What You'll Learn:
The basics of refinancing: what it is and how it can impact your financial goals.
The benefits of refinancing for lower interest rates, reducing monthly payments, and managing other debts.
Key terms to understand: loan term, discount points, break-even analysis, and blended rate.
Mistakes to avoid, such as extending the loan term without understanding the costs or adding substantial points.
The importance of doing a break-even analysis and understanding the costs involved in refinancing.
Timestamps:
[00:00] Introduction to mortgage refinancing
[02:00] Different refinancing goals: rate reduction, cash flow improvement, debt consolidation
[05:00] Understanding loan term and how extending it can affect long-term costs
[07:00] The impact of discount points and costs associated with refinancing
[10:00] Calculating the break-even point for refinancing
[12:00] Considering other debts and the blended interest rate
[15:00] When refinancing may not make sense
[17:00] Takeaways: analyzing the total cost of a mortgage before refinancing
Resources Mentioned:
Mortgage calculators for break-even analysis
Articles on the impact of refinancing on long-term financial goals
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives

Should You Buy or Rent?

Hosts: John and David Thompson
In this episode of SMPL Money, John and David tackle the classic question: “Should you buy or rent?” They dive into the factors influencing the decision, such as market conditions, cash flow, personal goals, and lifestyle considerations. With insights from their own experiences and practical examples, they discuss why owning a home might not always be the best financial choice for everyone and explore alternative ways to invest in real estate.
What You'll Learn:
The pros and cons of buying vs. renting in today’s market.
How location and affordability impact the decision to buy or rent.
The concept of opportunity cost: Why it’s important to consider what you could do with the extra cash flow from renting.
Different approaches to building wealth through real estate, including fractional ownership and investing out of state.
The importance of understanding your personal and financial goals when making housing decisions.
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] Exploring the traditional advice of “buying is always better” and its flaws
[02:00] Regional differences and their impact on housing decisions
[04:00] David’s personal experience renting in Los Angeles and how it affects his view on buying
[06:00] Alternative strategies for owning real estate before buying your first home
[08:00] Investing in real estate out of state or with friends as an entry point
[10:00] The financial and emotional components of owning a home
[14:00] Analyzing the cash flow differences between renting and buying
[17:00] Opportunity cost and using extra cash flow for investing
[19:00] Wrap-up: Should you buy or rent? It depends on your situation
Resources Mentioned:
Ric Edelman’s Article: 11 Reasons to Carry a Big Long Mortgage
Fundrise for fractional real estate investing
Resources Mentioned:
Your Money or Your Life by Vicki Robin and Joe Dominguez
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives

FIRE Movement

Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David discuss the principles behind the FIRE (Financial Independence, Retire Early) movement, drawing connections to the popular book Your Money or Your Life. They explore how people can build an ideal lifestyle by saving early, living frugally, and prioritizing time and freedom over material possessions. They also discuss how younger generations are redefining financial independence and retirement in modern times.
What You'll Learn:
An overview of the FIRE movement and what it aims to achieve.
Key insights from the book Your Money or Your Life and how it inspired the FIRE movement.
The psychological and philosophical components of financial independence.
Different approaches to achieving financial independence: Lean FIRE vs. Fat FIRE.
The importance of defining your ideal lifestyle and aligning your financial decisions with your life goals.
Timestamps:
[00:00] Introduction and overview of the FIRE movement
[02:00] How the book Your Money or Your Life influenced the FIRE movement
[04:00] Financial independence vs. early retirement: What do these terms mean for different people?
[08:00] The importance of living within your means and creating a gap between income and expenses
[12:00] Defining your ideal lifestyle: Sacrifices today for a better tomorrow?
[15:00] How younger generations are adopting flexible work lifestyles
[18:00] Lessons from the fulfillment curve and consumerism’s diminishing returns
[21:00] Tips for budgeting, saving, and working towards financial independence
[22:00] Final thoughts and actionable takeaways
Resources Mentioned:
Your Money or Your Life by Vicki Robin and Joe Dominguez
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.

Mortgages Part 3

Hosts: John and David Thompson
Episode Summary:In this final installment of the Mortgages series, John and David continue discussing Ric Edelman’s reasons for carrying a big, long mortgage. They cover reasons 8 through 11, focusing on how mortgages can provide greater liquidity, flexibility, and help build long-term wealth. They also dive into the bonus reason that you're never really "done" paying for housing, whether it’s through a mortgage or other living expenses.
What You'll Learn:
Reason 8 & 9: Mortgages allow you to invest more money and do it more quickly, leading to potential wealth-building opportunities.
Reason 10: A mortgage gives you greater liquidity and flexibility, allowing you to keep more cash on hand for emergencies or investments.
Bonus Reason (11): You will always have housing costs, whether it’s through a mortgage or rent, so it's beneficial to leverage a mortgage strategically for long-term wealth.
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] The ability of a mortgage to allow quicker investments
[03:00] How having a mortgage affects wealth-building strategies
[06:00] Liquidity and flexibility: Why a mortgage can be an advantage
[10:00] Understanding ongoing housing costs even after paying off a mortgage
[14:00] Recap of the 10 reasons and the bonus reason for carrying a mortgage
Resources Mentioned:
Ric Edelman’s 10 Reasons to Carry a Big Long Mortgage
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.

Buy Now, Pay Later

Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David dive into the growing trend of "Buy Now, Pay Later" (BNPL) services and the psychology behind debt. They discuss the different types of debt, the potential pitfalls of BNPL, and how it can impact financial behavior. The conversation also covers strategies for managing debt and making mindful financial decisions.
What You'll Learn:
The distinction between good debt (e.g., mortgages, student loans) and bad debt (e.g., high-interest consumer debt).
An overview of "Buy Now, Pay Later" services, how they work, and why they can be considered a form of high-cost debt.
The psychological impact of using BNPL services and how it can lead to unhealthy financial habits.
Practical tips for avoiding unnecessary debt and managing existing debt, including the debt snowball and debt avalanche methods.
The importance of mindful spending and setting financial priorities.
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] Discussion on different types of debt: good vs. bad debt
[02:00] What is "Buy Now, Pay Later" and why it can be dangerous
[05:00] The psychological effects of using BNPL services
[07:00] Alternatives to BNPL and strategies for managing debt
[10:00] The debt snowball vs. debt avalanche methods
[13:00] The importance of tracking spending and avoiding impulse purchases
[17:00] Final thoughts on financial discipline and future planning
Resources Mentioned:
Overview of debt management strategies like the debt snowball and debt avalanche (Link Here)
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.

Mortgages: Part 2

Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David continue their discussion on Ric Edelman’s article, "11 Great Reasons to Carry a Big Long Mortgage." In this part, they cover reasons 4 through 7, diving into the tax benefits, the impact of inflation on mortgage payments, and how mortgages can provide liquidity without selling your home.
What You'll Learn:
Reason 4 & 5: The tax deductibility of mortgage interest and why it might not be as beneficial as you think for most people, given changes in tax laws and the standard deduction.
Reason 6: How mortgage payments become easier over time due to inflation and increased income.
Reason 7: The concept of "selling without selling," or how you can access your home equity through refinancing or a home equity line of credit without having to sell your property.
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] Overview of tax deductibility and its diminishing impact for most homeowners
[03:00] Understanding itemizing vs. standard deductions
[07:00] How inflation makes mortgage payments easier over time
[10:00] The benefits of long-term fixed-rate mortgages in the U.S.
[12:00] How to "sell without selling" by accessing your home equity
[14:00] Advanced strategies for using home equity, including risk management and financial planning
[15:00] Preview of the next episode covering the remaining reasons
Resources Mentioned:
Ric Edelman’s Article: 11 Great Reasons to Carry a Big Long Mortgage
Further reading on mortgage interest and tax deductibility
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.

Mortgages: Part 1

Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David discuss the first three reasons from Ric Edelman's article, "11 Great Reasons to Carry a Big Long Mortgage." They provide insights from their generational perspectives on why carrying a mortgage can be beneficial, challenging conventional wisdom that encourages paying off mortgages quickly.
What You'll Learn:
Reason 1: Your mortgage doesn't affect the value of your home. The appreciation of your home is determined by the market, not by the presence or size of a mortgage.
Reason 2: A mortgage doesn't prevent you from building equity in your home. Equity is primarily built through home appreciation and paying down the mortgage with your own funds.
Reason 3: A mortgage is cheap money. Mortgages typically have low interest rates, especially fixed-rate mortgages, which can be advantageous in the long term due to inflation and increasing earning potential.
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] Overview of Ric Edelman’s article and its relevance
[02:00] Discussion on why people generally avoid mortgages
[03:00] Reason 1: Your mortgage doesn't affect the value of your home
[04:00] How home appreciation works independent of the mortgage
[05:00] Reason 2: A mortgage doesn't stop you from building equity
[07:00] The concept of equity and its relationship with home value
[08:00] Reason 3: A mortgage is cheap money
[10:00] The benefits of long-term fixed-rate mortgages
[12:00] The concept of liability asset gap and financial arbitrage
[14:00] Importance of understanding opportunity cost in financial decisions
[16:00] Wrap-up and preview of the next episode
Resources Mentioned:
11 Great Reasons to Carry a Big Long Mortgage by Ric Edelman
Books by Ric Edelman: "The Truth About Money", "Ordinary People, Extraordinary Wealth"
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.

Goal Setting and Discipline

Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David discuss the importance of goal setting and discipline from their generational perspectives. They explore why goal setting is crucial for personal and professional success, the common challenges people face when setting goals, and practical tips for maintaining discipline to achieve those goals.
What You'll Learn:
The concept and importance of goal setting
Different perspectives on goal setting across generations
Common reasons why people fail to achieve their goals
The role of discipline and habits in achieving goals
Practical tools and techniques for effective goal setting
The concept of time blocking and its benefits
Insights from notable books on goal setting and discipline
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] Initial thoughts on goal setting from John and David
[02:00] Generational differences in goal setting
[03:00] The fear of setting and failing at goals
[05:00] The definition and importance of discipline
[07:00] The role of habits in maintaining discipline
[08:00] Strategies for realigning with your goals
[09:00] The 90-day priority setting method
[11:00] Tools and techniques for daily and weekly goal tracking
[12:00] Overcoming resistance to time blocking
[15:00] The concept of "white time" and its importance
[16:00] Final thoughts and a quote on goal setting
Resources Mentioned:
Traction by Gino Wickman
The Rockefeller Habits by Verne Harnish
The Compound Effect by Darren Hardy
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.

Money: Past, Present, & Future

Hosts: John and David Thompson
Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David explore the evolution of money from its origins in bartering to modern-day digital currencies like Bitcoin. They discuss the fundamental properties of money, their personal experiences with money growing up, and speculate on the future of money and financial transactions.
What You'll Learn:
The essential functions of money: store of value, unit of account, and medium of exchange.
John and David's personal histories with money, from physical cash to digital transactions.
The potential future of money, including cryptocurrency and digital banking.
The impact of technology on financial transactions and the possibility of a return to barter-like systems through digital means.
Insights into the rise of digital wallets and online banking, and the potential for blockchain technology to revolutionize financial data security.
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] What is money? Fundamental properties explained
[02:00] John’s relationship with money growing up
[03:00] David’s early experiences with money and transitioning to digital transactions
[05:00] The evolution of financial transactions: from cash to checks to digital
[07:00] Future of money: cryptocurrency, blockchain, and digital wallets
[10:00] The impact of inflation on money and potential alternative transaction methods
[12:00] Skepticism and adoption of new financial technologies
[14:00] Modern money features and the importance of digital security
[16:00] The role of open banking and blockchain in future financial systems
[18:00] Introduction to Savology: a financial planning tool
Resources Mentioned:
Savology
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.

What is Financial Health?

Hosts: John and David Thompson
Hosts: John and David Thompson
Episode Summary:In this episode of SMPL Money, John and David explore the concept of financial health and what it means to different generations. They discuss the importance of having an emergency fund, understanding personal cash flow, and setting financial goals. They also share practical tips and tools to help listeners achieve financial well-being.
What You'll Learn:
The definition of financial health from different perspectives.
The importance of having an emergency fund and how much you might need.
Setting financial goals and the impact on financial health.
The significance of understanding your personal cash flow.
Awareness and habits that contribute to financial health.
The role of education and seeking advice in maintaining financial health.
Introduction to the Savology tool for financial planning.
Timestamps:
[00:00] Introduction to the episode and hosts
[01:00] David’s perspective on financial health
[02:00] The importance of an emergency fund
[03:00] John’s insights on financial health and reducing stress
[04:00] Setting financial goals and habits
[05:00] Understanding and managing personal cash flow
[07:00] The role of awareness in financial habits
[08:00] Recognizing financial triggers and influences
[09:00] Sources of financial information and education
[11:00] Seeking advice and different perspectives on finance
[12:00] Managing risks and being prepared for financial setbacks
[13:00] Introduction to Savology and its benefits
[13:30] The Four Steps to Financial Freedom
[14:00] Conclusion and final thoughts
Resources Mentioned:
Savology
Connect with Us:Reach out to John and David with your questions or feedback. SMPL Mortgage
Follow us on social media for updates and more insights. @smplmortgage
If you enjoyed this episode, please like, share, and subscribe to SMPL Money for more insightful discussions. Stay tuned for our next episode where we continue to unravel the complexities of finance in our lives.