1/7/26 Head Over Heart: Staying Disciplined as Markets Flood with Uncertainty

The Moneywise Radio Show and Podcast Wednesday, January 7th BE MONEYWISE. Moneywise Wealth Management I "The Moneywise Radio Show & Podcast" call: 661-847-1000 text in anytime: 661-396-1000 website: www. MoneywiseGuys.com facebook: Moneywise_Wealth_Management LinkedIn: Moneywise_Wealth_Management The opinions voiced in this podcast are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may be suitable for you, consult the appropriate qualified professional prior to making a decision.

• 0:00Speaker 00

  From the second floor of the historic Woolworths Building in downtown Bakersfield, here is Money Wise. Call or text into the show 661-396-1000.

• 0:10Speaker 01

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• 0:30Speaker 02

  Securities offered through LPL Financial, member FINRA, SIPC. Investment advisory services offered through LPL Financial. LPL Financial and Money Wise Wealth Management are independently owned and operated.

• 0:39Speaker 00

  Here is Money Wise.

• 0:41Speaker 03

  That's right. Welcome into the Money Wise Show. I'm your host today, Chris Pelster, joined with?

• 0:48Speaker 04

  Seth Perry. Good to be back, KP.

• 0:50Speaker 03

  Mr. Seth Perry, how are you doing, sir?

• 0:52Speaker 04

  I'm good, man. How are you, my friend?

• 0:54Speaker 03

  Good, good. Got some rest, had a wonderful Christmas vacation, some New Year's celebrations. Do what we do, go out to the desert, play a little bit in the dirt. Got rained on a whole lot, but that's okay. That was fun. And got some rest and relaxation and ready to tackle 2026. So, welcome to the New Year, listeners. Welcome to New Year's. Mr. Steven over there, how are you doing, sir?

• 1:22Speaker 00

  I'm good, I'm good. I'm really just ready to be in the same building with you.

• 1:28Speaker 03

  Yeah, yeah, we're getting there. We're getting there close. I went downstairs into the basement yesterday and saw all the improvements and upgrades and sweet couch in your, in your little, your new studio down there. So, looking forward to having it at home.

• 1:46Speaker 00

  Our new studio.

• 1:48Speaker 03

  Yeah, but you're the man. You're the man that runs it and keeps it. If it was up to us, it'd probably burn down, so. So we appreciate all that you do for the show. So

• 1:58Speaker 04

  Steve's mic is made of pure gold, by the way.

• 2:00Speaker 03

  That's right. That's right. But you guys, the listeners are what make the show great. So we have some great questions that came in that we'll go through. We don't have any guests joining us today, so we're going to be able to talk through a lot of different things. We thought it would be great to start out the year first show for me and Seth to go over some great things to remember to start out the year. You know, sometimes it's good to go through some things to remember to think about the year. And we're going to try to also talk about it from a perspective of whether you're starting out in your financial journey, whether you're midstream of your wealth building journey, whether you're transitioning to retirement or later in life. All those same concepts that you've heard about, we'll go through that list, but we'll also

• 2:43Speaker 03

  tackle some of these questions that have come in from our listeners. So if you also have a question or want to join the conversation, you can also text or call the show 24 hours a day, 661-396-1000. You can send in your message and we'll get it to the next on the next radio show, podcast, we'll try to go over that. So we always try to get to those questions are very important to us. And like I said, you guys make the show what it is. And so if you have a question or concern on your mind, there's a very high probability that another listener has the same thought. So we're going to to jump into those. Before we do that, though, we're going to go a little bit into the market news. What's going on there in the market? So

• 3:24Speaker 03

  no big shocker there. The market took a little bit of a breather today. But we're still up in positive territory on the year. And this is also hindsight 2020, you know, looking back over the last 12 months. The market is up about 17% over the last year. So we always

• 3:45Speaker 03

  We always want to, you know, kind of do a little look back, a thought of where we're at. So when people say, you know, is the market going to hiccup or is the market going to crash? And sometimes it's just good to remember, you know, over the last 12 months with everything going on and with a lot of the uncertainty and all these different things going on, the stock market is still, when I say stock market, this is specifically talking about the S and P 500 is up 17%. The other major indexes are also positive over the last 12 months, maybe not quite 17%. The NASDAQ actually might be a little bit higher than that because remember the NASDAQ is what is more tech-heavy. And so a lot of those tech companies are what have been big movers and shakers

• 4:27Speaker 03

  over the last 12 months. And so, yeah, you know, there's going to be some uncertainty this year. There's going to be some unfolding of some of these different things. As a matter of fact, right now, what Wall Street is looking at is the jobs data that just came out. And they're also still trying to think about what this Venezuelan, you know, geopolitical issue and the oil and all that different stuff, they're digesting all this stuff and what the jobs report that just came out. So the market took a little bit of a breather, pulled back a little bit. You know, basically brushing aside the whole Venezuela development, looking at the jobs data and it's not, nothing too major because it's not like the markets moved too much,

• 5:11Speaker 03

  but it did pull back a little bit. So President Trump did say the country will relinquish, send up to 50 million barrels of crude of output valued at about 2.8 billion. So this is basically going to indefinitely control Venezuela oil sales. And so we'll continue to kind of go over this and talk about this. No big shocker there. We see companies like General Dynamics, Lockheed Martin, Northrop Grumman, which would be considered what are called defense stocks. They would not be allowed to buy back shares or issue dividends.

• 5:55Speaker 03

  Until they produce to maintain more equipment at a faster pace. Uh, so that's a little of an interesting development there where um they're not able to buy back their own stocks. Because obviously those companies uh usually do well when there's geopolitical concerns like with what's going on in Venezuela. Um, so he's tying their hands a little bit, allowing uh not allowing them to buy their own stock. So that they won't be able to participate if those companies go up in value uh in the short term because of some of these developments that are going on. So not to get too much in the weeds, just kind of tell you about what's going on with all that being said, you know, the markets, like I said, pulled back just slightly.

• 6:34Speaker 03

  Um, the S and P 500 pulled back just about point three percent today, still up about point six percent on the year. Uh, which again, we're only seven days into this year so far. And again, over the last 12 months, the S and P 500 is still up about 17%. The Dow is down almost one percent and the NASDAQ is up slightly point two percent. Um, so mixed markets, they call that when you have different indexes in uh different territories. So anything else you wanted to throw out there as far as what's going on?

• 7:07Speaker 04

  No, it's just uh nice to see it was another uh double digit year up 17%. You know, that's following so back looking back in the rearview mirror 2020 up 18% 2021 up 28%. And then we saw 2022, which was as uh our coworker Dustin says, there was nowhere to hide as both stocks and bonds dropped. But the S and P went down in 2022, 18% and then 23, 24, 25 was up 26, up 25, up 17. So um I remember this time last year, everybody talking about how, man, this is just going to be a bad year. 2025 is going to be rough and a lot of the quote unquote experts.

• 7:49Speaker 04

  But I will tell you as someone who works in the industry and then kind of with a peek behind the curtain, working with some of these experts and these analysts and listening in. No one ever truly really knows, you know, and so it's best to just have a well diversified portfolio, work with a professional. And stay invested. Don't freak out. Don't panic. And yeah, anything can happen.

• 8:11Speaker 03

  Yeah, this is definitely one of the things where, you know, i- i- if somebody is majorly concerned about Venezuela and all those different things, the the MoneyWise way of looking at things is rebalance your portfolio. Y- y- your stocks probably did really well last year. If you're, if you have an allocation that you're comfortable with, make sure there's a process in place that things get rebalanced. And so obviously, that's what we're doing on an ongoing basis with our clients and when we're managing their accounts for them. You know, we're not making major moves or trying to time the market or really making major shifts one way or the other. But when you're rebalancing, that's what you're doing is you're saying, hey, the stocks did really, really well over the last 12 months.

• 8:51Speaker 03

  We're trimming that back a little bit, putting them back over into the bond side or even some of the cash or cash equivalents, they're called. So then if the market does hiccup, you have taken advantage of some of your distributions. Another way that a lot of retirees or people that are in later stages of investing that they don't realize where they took advantage of it. Well, all last year, if you were taking distributions out of your account, you were getting to take distributions out of your account while your stocks were doing 16, 17% all year long. And so even if the market hiccups, that's how staying invested and staying with your strategy over a long period of time can make your money last, even though it feels like, you know, now my account's down. Well, when, when your account was up this year, you were taking distributions out in retirement.

• 9:35Speaker 03

  Hopefully, you're invested appropriately, taking on the right amount of risk to actually make your money last longer, even though it can be hard to see what that looks like when you're retired. And and every time your account goes down at all, it can have an overwhelming impact on your emotions. So a lot of times, that's what they say, the biggest benefit you get with working with an advisor, especially one that you can trust and and has a, you know, you know, hopefully a good track record of working with people over a long period of time that, you know, through the ups and the downs, stick with your strategy in the long run, you're going to be better off. So there you go. That's the market activity market news.

• 10:12Speaker 04

  Did have one more, Chris. I want to talk a little bit about GameStop, if if we can sneak this in here. I I think I'm going to run something up the flagpole as far as our pay, me and you. Because I mean, if the GameStop CEO has a new thirty five billion with a B, thirty five billion dollar performance based pay plan, did you hear about that?

• 10:32Speaker 03

  No.

• 10:33Speaker 04

  So hi- his, uh, his pay plan is based on obviously his performance. If the stock has just plummeted, it's gotten hammered the last several years. And so they've put this thing in with all these stock options. So naturally, if he can get the company's stock to skyrocket, it could result in a thirty five billion dollar payday for him, which is insane. That's, that's, I mean, that's crazy in and of itself, but it made me think about all of our jobs out in the community. Imagine if everyone was tied directly to their performance. Do you think we'd get a little bit more production out of society?

• 11:06Speaker 03

  Yeah.

• 11:07Speaker 04

  Everyone has to produce or else that's it.

• 11:10Speaker 03

  Yeah.

• 11:11Speaker 04

  Imagine how much different things would be. I, that's almost like them watering down grades in the school. I know it was, uh, uh, some districts are even getting rid of Fs unless they haven't already started, which is just hilarious. And then I remember going to Washington, so such a rabbit trail, maybe it's the coffee. But last, uh, last couple of years ago, went to Washington DC with my daughter. And early on, when the US education system was founded, an A wasn't, uh, uh, I think it was like, uh, you had to get a, uh, ninety two percent or something like that. Like it wasn't even the same scale we're on now. You had to really kill it to get an A. And so it's like, anyway, all that said, what do you think, Chris? Should we put this in place? The guy that's, that's making our, uh, sandwich, if he doesn't do a good job,

• 11:56Speaker 04

  we can report it and he'll get fired. What do you think?

• 11:58Speaker 03

  Yeah, yeah, absolutely.

• 12:00Speaker 04

  Are you all for this?

• 12:00Speaker 03

  I thought you're, if you're going to talk about around here, uh, we would have to put together a compensation package that instead of the, the B, the bill, the billion word as far as benefits, uh, we, we would be in the huh, the H, the hundreds, uh, you could increase your pay. So we're on a different pay scale with, with them. And what's funny about GameStop is remember the GameStop stock play through the years has all been because of, you know, they, they call them the meme stocks. And so like, The funny thing about him trying to get the stock value to go up, he's going to be going to Reddit right now and social media and trying to like blow up the stock in like, hey, everybody get

• 12:41Speaker 03

  out there and start buying the stock. And, and that was what I hated about the meme stock thing. Remember they called it kind of the Robin Hood play where it was like all the, the, the average investors sticking it to, to Wall Street. And I understand that concept and a lot of, you know, people, uh, kind of feeling like it was sticking it to all the, the, the super uber rich, but I hated it because it's manipulating the markets, you know, and that, that's the same thing that they would hate about the rich manipulating the markets and you're manipulating the markets backwards. You're, you're, you're incentivizing trades, not based on a company doing good or bad. You're, you're incentivizing, manipulating a, a, a stock price, uh, where investors are putting up their money, betting that the

• 13:26Speaker 03

  stock was overvalued. Um, and so they had, you know, shorts, uh, they'd shorted the stock, insinuating that it was going to go down. And then these people are rallying the stock just to manipulate the price to then force investors to have to pour more money into the stock. It kind of gets into the weeds a little bit, but you know, it was kind of such an interesting concept. And so some people-

• 13:47Speaker 04

  Makes you think too. If, I mean, if that, if that much money's on the table for this guy, who's to say he wouldn't spend $10 million to just hire people to go online and to create this hype? Cause that would ultimately pay off for him. Unless, is that considered investor, insider trading?

• 14:05Speaker 03

  It's not, it, it's manipulation. So he, you would get in trouble. And so like, if you remember back when, when all that was going on with GameStop, Hello Kitty, or whatever that guy's name is, that was doing this. He, he had to sit in front of the, uh, he had to sit in front of the, the, the finance board and stuff. And, and he was actually a licensed advisor. And so he lost his license and a bunch of different stuff, which he'd made so much money off the stock trading and stuff that he was doing. He probably didn't care at all. But, um, but yeah, there's, there's rules and there's things that he can't do as a CEO and, you know, all of his trades are- Have to be common or publicly made known and he can't be manipulating people and that kind of stuff. But that is literally what a lot of them were doing is basically going on Reddit

• 14:50Speaker 03

  boards and then they were talking about, hey, if we all go in and buy GameStop stock, it's going to hit this point. And then they're all going to have to pour more money into it, or it's like a roaring, roaring.

• 15:01Speaker 04

  Roaring kitty, yep.

• 15:03Speaker 03

  That's a Dodger fan in me. Dodger fan in me goes, hello kitty.

• 15:06Speaker 04

  Yeah, yeah, yeah.

• 15:07Speaker 03

  Yeah, there you go. All right. Anyways, we're gonna take a break.

• 15:09Speaker 04

  Did you have one of those at Stockdale? Did you have one of those backpacks, Chris?

• 15:12Speaker 03

  No.

• 15:12Speaker 04

  You know, that's the thing now. Imagine me and you back 1998. I mean, these kids are just, they they're cut from a different cloth. That's kind of the thing now is they can wear like a, like an 18 year old football player can wear a Transformers backpack and that's just okay and cool. And it's like, I like that, man. I think it's cool that they can just get loose like that. Before we go to break, super quick, a message, a message came in that said, I'm glad you guys said that because 2026 worries me with all the crazy things going on. I forgot you always say, but overall to just write it out. That's like our theme this year. Just write it out.

• 15:49Speaker 03

  There you go. Yeah, like I said, it doesn't mean bury your head in the sand and do nothing, but but we've been doing this for a long, long time and working with people and just make sure you're in a mix that makes sense for your situation. Your allocation needs to make sense for your situation. And if that's how you're invested, then there's no reason to panic or worry. It's probably a good time to make sure you have a process of rebalancing. You know, we rebalance usually on a quarterly basis, depending on what's going on in the markets for our clients and have a process to do so. And so hopefully you're doing the same. If you're in a 401k, it may be a little bit more difficult or not sure if it's doing that automatically for you. But obviously, that's another time where maybe you sit down with an advisor and go over things. But yeah, yeah, stay the course and it has proven to be in

• 16:32Speaker 03

  everybody's best interest to keep doing that as long as you're invested appropriately for your situation and in a good mix. So.

• 16:40Speaker 03

  It looks differently a little bit for everybody, but yeah, it's the best advice to stay. And sometimes it's really, really hard to stick with it and get your emotions in check. But little by little, as we all go through our wealth journey and you have more and more experiences in these different times, you know, it's like you grow and mature and you go, okay, we're okay. And I love hearing my clients say, yeah, I've been listening to you say the same thing for a long time. And I'm really starting to get it and they don't freak out. And then that allows you to focus on what matters most in life, which is not necessarily whether your account is up and down. And if you stick with it over the long term, your account's going to be doing what it's supposed to be doing based on the risk level that you have in your account. And it actually helps you enjoy your wealth more and be able to focus more on what matters most, which, you know, for many people, including

• 17:24Speaker 03

  myself, is not just the value in the accounts. It's not just the money in the bank. It is people, relationships, those around me. And so, so yeah, take a deep breath. 2026, who knows what it holds. But hopefully, we can help you stay money wise. So stick around. We'll be right back. We'll get into some of those comments and questions.

• 17:42Speaker 00

  If you're a business owner who provides a retirement plan for your employees, contact Money Wise Wealth Management to see if you're maximizing your options and minimizing your liabilities. Money Wise 401k plans are customized to you and your company's needs. 661-847-1000.

• 18:04Speaker 03

  That's right. Welcome back. Like I said, we have some great messages and it came in. And the first one, we talked a little bit about in just kind of talking about the markets and what the markets are going through right now and talking about Venezuela. And so we had one message come in that said, I may be late to the conversation, but how will this whole Venezuela oil debacle hurt oil in the US or even in our backyard? Thanks, guys. So wanted to talk about a few things just to remember.

• 18:36Speaker 03

  With this, it will have some short-term impact on prices, but US gas prices won't change like right away. Venezuela isn't a huge supplier currently, and if you'll think about why, it's because basically for years, there's been neglect. Their infrastructure, you know, what's been going on in Venezuela, it wasn't like they had this robust economy that was just pumping out oil and this well-oiled machine, pardon the pun. And so unfortunately, because of that, fortunately, unfortunately, however you want to look at it, it doesn't mean that all of a sudden Venezuela oil is going to flood the market. And that's what

• 19:20Speaker 03

  you're talking about there was when you're going to talk about how is it going to impact oil or energy prices or gas prices. That's what would be the concern is that a flood of oil into the market would be an oversupply, which supply and demand trends would then say that the price would come down or, you know, which could help us as far as paying for it. But then obviously, when you talk about oil producers, you talk about local companies, especially when you say in our own backyard, we have many, many issues that have been impacting local oil producers and oil companies in the state of California

• 20:00Speaker 03

  and here in Kern County mainly, feeling the biggest impacts of that. So, but it's not going to happen overnight. It's not going to happen right off the bat. There's lots of things that have to kind of get turned around before oil, their infrastructure gets kind of rebuilt. So it won't boost supply quickly without kind of major investments going into that to rebuild it.

• 20:24Speaker 04

  Tens of billions of dollars. It's a huge undertaking. You're just driving down Roseville Highway. Look at some of the refineries we have here, and we're not necessarily talking about refineries, but just the

• 20:37Speaker 04

  The metal infrastructure and all the pumps and everything and just if it's been neglected, I mean, even just for a short period of time, these things run 24 hours a day around the clock and they're supposed to be serviced regularly on regular intervals and it takes a lot of money, a lot of investment to do that. And from all the reports we're reading, it's it's just in really bad shape right now. So long term, absolutely.

• 20:59Speaker 03

  And with the uncertainty of what's going on, when you say that it takes investment, if you're an investor, do you want to throw your money at a lot of uncertainty? Now, obviously, higher risk, higher reward. So I'm not saying that nobody wants to throw money at it, but there's a lot of people that might be like, I'm going to keep my money out of this investment opportunity because of the uncertainty. So it has all these different variables and different things that are going on. But I think kind of what what is being asked here in this person's comment and question is basically just the fact that if Venezuela production does eventually take off and rise, it could put downward pressure on prices, which could be good for us at the gas

• 21:45Speaker 03

  pump, but obviously difficult for local oil companies, producers, refineries can can add, you know, kind of more pressures to an already pressured industry. So.

• 22:00Speaker 04

  I know Chevron is the only US company operating there in terms of, you know, who's who's drilling these wells and producing these wells. The service companies, the Halliburton being based here in the US and several other companies, there is a potential. I know their stock, Halliburton's stock shot up like 7% and then it's pulled back a little bit the last couple of days based on the news. But again, these are these are long term speculative type investments. But I mean, over the long haul, if it if it brings our gas prices down and produces tons of new jobs, you know, and people are traveling, I mean, absolutely, it's going to help the stock prices and the companies to grow. And it's just, gosh, isn't it interesting? Not to get political, but I mean, we went in there and.

• 22:46Speaker 04

  Just took him, you know, and it's interesting. You look at some other regimes. We've had a stronghold takeover. But we won't talk about politics.

• 22:55Speaker 03

  I was watching, it's a podcast, but they have like the video of it and the guys talking about it. He's like, he's like a military guy and he's like, I don't know if you guys realize this or not, but like we just witnessed like the Super Bowl of military operations, like to go in and to just steal the president from another country. Like that is like the Super Bowl.

• 23:15Speaker 04

  Kind of a big deal.

• 23:16Speaker 03

  Yeah, it's pretty wild. And, you know, I mean, I, I hope that there's wisdom from up above pouring into our administration. And, you know, if you're a person of faith, I'm praying for our leadership in our country and, you know, hoping good things for, for America and, and actually for all countries, for that matter. And there's a lot of things that are going on that are very difficult to try to really wrap your head around and, you know, social media has made things so crazy to go out there to chase rabbit holes. And so again, I'm just hoping that there's some wise people making good decisions for all people involved, for the most people involved.

• 24:00Speaker 03

  So that as many people as possible can pursue life, liberty and happiness. And not have their rights infringed upon, you know, hoping great things for this country.

• 24:14Speaker 04

  12,000, 12,000 US troops were involved in this extraction. There were zero US military deaths. Seven US members were injured during the raid. And some of the reports coming out on some of the mainstream media, if you want to believe it or not, is that there were about 75 Venezuelans taken down. And again, we know what they were doing. We know about the boats. We know about what it's been doing to our country. But this is just very interesting. We'll have to see how it plays out, Chris.

• 24:42Speaker 03

  Yep. There you go. So, uh, so yeah, to, uh, to switch gears now to another.

• 24:48Speaker 04

  Chris, you're killing it. So you're talking flooding the market, right? With an oil story. And now we're switching gears into an electric. Vehicle. You you're on point for 2026.

• 24:57Speaker 03

  Oh, okay. We're gonna go electric vehicles. I was gonna go into Trump Trump accounts, but yeah,

• 25:02Speaker 04

  let's do it. Let's do it. Let's do it.

• 25:03Speaker 03

  Yeah, no, because there was another comment about buying an electric vehicle. And it's a great, it's actually a great topic because unfortunately, a couple of things changed at the end of last year. So a message came in said, I'm on the fence about buying an electric vehicle and wanted to hear what you guys thought of if it was a good time to go that route or should I wait until my, or should I wait until my luck, I buy into something and tech world changes or improves, Danny. So Danny, thanks for the comment. The one thing I will say is that electric vehicle prices, at least like Teslas and stuff have come down a lot in price. So entry into it, it's lost a lot of, a little bit of its luster. Now, part of that is also because at the end of last

• 25:47Speaker 03

  year, you got, especially like in California, there were rebates that you got for buying an electric vehicle. Well, those expired, I think in September of 25. So there was a little bit of rebate you got for buying those vehicles. So yeah, they were a little bit more, but you got a rebate as long as your income was under a certain level and a couple of different things. Well, those rebates have expired. So that's a, that's a downside. But that, that basically, the way rebates work and why it's kind of funny is, you know, if the government's offering a $7,500 rebate, well, guess what? Tesla is going to charge 7,500 more dollars for their vehicle. Because they're trying to get an electric vehicle company off the ground, which I don't know if you've started

• 26:32Speaker 03

  a new vehicle company lately. It sounds like it's a pretty big undertaking. We've basically had the same, basically three American companies forever, that it all just own each other with different branded names. And obviously, we have some foreign companies that sell in our country. And so, but in, long story short, prices have come down of electric vehicles. The, the, the charging networks, there, a lot of them are playing nicely with each other. So you can Charge different vehicles and different networks Tesla being ahead of the curve as far as uh you know

• 27:11Speaker 03

  availability for charging networks. I will say this, uh if you were lived in different states,

• 27:20Speaker 03

  the the charging network is minimal. If you're driving around of California a lot, you don't necessarily drive through the middle of America a whole lot, then it's not an issue. California is phenomenal as far as charging places, places to charge and all that.

• 27:35Speaker 04

  What does it cost to if you have a Tesla and you're running low and you need to go to the the charging station by Target at the Riverwalk? What does it cost to charge up and how long does it take nowadays?

• 27:45Speaker 03

  It's you can charge really quickly, really fast. So the way I the way I explain it is depending on how you're so my my car, I have a Tesla, it's charged all the time. So I don't ever have to worry about charging until we're gonna go out of town. So that's the that's the one big change. You don't ever have to worry about charging a whole lot unless you just mismanage it. Your your car should almost always be charged because you either charge at home, even if you don't have like a higher end charger, you just plug it into the wall and overnight it should have enough charge the next day to get you through most of your regular driving. But then even like if you're gonna go down to LA and go to a Dodger game and do this and that, you might have to stop twice

• 28:27Speaker 03

  or something and it might be 10 bucks to charge both times. So you know, I mean, if you drove down to LA and went to a game and came back, you probably have to put in 40 bucks or 50 bucks, 60 bucks of gas, you might have to charge electric, you know, and do 10 or 20 bucks to get there and back. And it's a little bit annoying because you might have to stop twice or something like that. And some people uh you know, have an issue with that. But what's funny is for me, it has made driving and trips more enjoyable, as weird as that sounds, because it used to be like I wanted to get in the car and I just wanted to get where we were going so fast and I almost was like stressed out and anger, you know, like road rage. And now it's like we stop somewhere,

• 29:11Speaker 03

  I get a soda, you know, there's a couple of places we stopped that have delicious. Tacos. I don't know if you guys knew this. I'm a fan of tacos. I know. Um, there's one place that it's a little Mexican joint and has uh this, these uh orange Julius type flavored um horchata's and it's like a little treat now that I stop and I get one of those when we happen to be driving down to LA and I need to stop there and charge. So it's like it's changed my relationship with travel and actually made it a little bit more enjoyable. Um, and most of us stare at our phones more than we should. So every time I stop, I check my phone. I check my emails. I check my texts. I get back to a few people instead of doing it while I'm driving, even though with self-drive, you're tempted to do it while you drive.

• 29:56Speaker 03

  You can't completely do that right now while you drive because man, that Tesla knows the minute you pick up your cell phone, which is a little spooky. Uh, but uh, but yeah, you're not supposed to be staring at your phone while you're on self-drive. I actually have to pay more attention while I'm on self-drive than when I'm not on self-drive, which is kind of funny because what's the point of self-drive? But I think they're actually getting very close. The reason why they're not doing full self-drive right now is because once they do full self-drive, if there's an accident, it is Tesla's fault. Right now, even if I'm on full self-drive, but I'm technically supposed to be paying attention, it's my fault.

• 30:37Speaker 03

  So I'm sure they're working out the kinks and the insurance and how they're going to handle that, that if they go full self-drive, um, and you turn it on and you want to take a nap while you're driving, because now Tesla is going to be liable if something happens while you're sleeping. So crazy things, but that's kind of a tangent. Just kind of went on a rant a little bit about electrical cars and all that stuff, but because prices of electric vehicles have come down, you can buy used ones now. They've really depreciated. Man, it, it can be a good, you know, financial decision if it fits within where you're driving and what you're doing. Yeah.

• 31:17Speaker 03

  If you live somewhere that's really, really hot or gets really, really cold, that can really like take the, the juice out of your batteries. So that can be less of a desired thing, but even here in Bakersfield with the heat that we have, you know, you keep it in the garage and you keep it charged. We've enjoyed our electric car vehicle. And this is coming from a person that I bought when it was still kind of cool and new and the prices really shot up at the end of COVID and coming out of COVID 2021, 2022. And we kind of paid a big premium to get ours. And we're still okay with it. We were kind of what would be a little bit of an earlier adopter. And so we kind of overpaid like we look at what you can buy the same car that we have now

• 32:02Speaker 03

  three years newer, brand new, and we're like ouch. But

• 32:06Speaker 04

  There is still, there's one federal rebate that's available for the charging equipment. So the main, the main one for the vehicle purchase itself expired September 2025. But an EV charger purchase install credit up to 1,000 is good through June 30th of 2026. So Danny, that might give you a little bit of incentive, but from reading, reading up on the market today, the numbers are coming out that the sales dropped on EVs last year in the US. And so that's going to give them even more incentive to lower the prices to move some, move some products. So maybe go check us out and let us know what you end up deciding to do, Danny, please. That would be great.

• 32:43Speaker 03

  Awesome. Yeah, there you go. Hopefully that helps you out and coming from somebody who actually drives one. And like I said, I paid a little bit more for it and because they were a little bit more expensive a couple of years ago, but still, still don't necessarily, I'm not bummed and it's been a fun experience. So the other question that came in was about the Trump accounts, which we've had a lot of questions about that. We always try to preface this with saying the unfortunate things. It says, how will these Trump accounts work? Any chances you guys can break it down to a parent of three young children? The reason why it is annoying for us and probably for you trying to understand this is

• 33:24Speaker 03

  they came out with this idea and and a lot of these different things that they've said that they're going to do, but then the actual nuts and bolts and details, it takes them a while to really unfold those types of things because like they it's not they they haven't said necessarily where you're going to be able to open up these accounts yet or how they're gonna be opened up.

• 33:46Speaker 04

  Details are sketchy for sure still.

• 33:47Speaker 03

  Yeah. And so it's it's like they they say that they're going to do this, they budget for it, they make a big deal about it, you know, I don't, you know, for whatever reasons, you know, to to get votes or to get people's uh, you know, whether they like it or not, or whatever, but then the details are being worked out. We actually did a couple of things with a wonderful local CPA firm here last year, at the end of last year, and it was funny because they're they're talking about um, all these tax things, but it's like every single new new one we did, they're like, but we don't even know some of the details and and sometimes with tax law, it's like they come out with these rules, but then you have to actually wait till case law happens, or

• 34:28Speaker 03

  somebody might get audited and then they make a ruling and then it gets starts to give you more details on what the seat uh, what the IRS is actually meaning with these rules. Same thing with these accounts. They've come out and they've basically said that if you have kids born between, what is it, 2024 and 2028?

• 34:48Speaker 04

  Yeah, December 31st of 2024. So basically born anytime from January 1st, 2025 until January 1st, 2029. We know that much, that won't change.

• 34:59Speaker 03

  Yep. So each each child will get a thousand dollars born in that window or in the next couple of years. Uh, it's basically going to be invested in an indexed fund. So like when we talk about the how the markets are doing and we will throw out the S and P 500, it's going to be tied to like the S and P 500. So whatever top 500 companies are in that index on an ongoing basis, it's not a managed mutual fund, it's just a Index that has criteria of how they select the top 500 companies. Basically, just the biggest companies. And so if a company gets smaller over time, it may drop off. And then they're going to go out and find the next largest company and it's going to jump into that index.

• 35:44Speaker 03

  You know, like GE used to be on the S and P 500 and it got smaller over time. And so it dropped off and the next biggest company got jumped onto it. And and that changes all the time, but it's not a managed mutual fund. That some people might think about. So many people kind of understand that index and there's a way that you can invest just directly in that index. Usually it's called what's an ETF, an exchange traded fund. And so that's kind of what this will be is they're going to take a thousand bucks, put it in an account. It's going to participate with the ups and downs of those 500 companies. And, uh, you know, they're throwing out the numbers that if the index does what it's done over the last 30 or 40 years, or does something like that over your kid's lifetime.

• 36:28Speaker 03

  That thousand dollars, if they don't touch it, could be anywhere from 450 to 550,000 dollars. Depending on what the markets do, it gives our kids, the kids born between 2025 and 2029. Incentive to participate in this economy, to have some of these, uh, 500 companies do well over the next 20, 30 years and you'll be able to participate in that. But I think they will have access to it at age 18. So if they use it for something else, they can do it. They, um, they will pay taxes on it, I believe, when they pull it out. And so it's one of those things where I've watched a couple of discussions. We're still trying to understand exactly how it will work.

• 37:10Speaker 03

  They're, they're, they're trying to spin this as, hey, you know, anybody, your friends and your family and your parents and grandparents can put money into this account.

• 37:16Speaker 04

  Up to 5,000 a year, it'll, it'll bump up starting in 2028. So it's, it's awesome. Free, 3,000 bucks from the government. And then, um, the details will get shaken out on how parents and relatives and employers, uh, can contribute.

• 37:31Speaker 03

  Yeah, because the parent, I don't think the parents or anybody else contributing to it will get a tax benefit. So I'm still waiting for guidance as far as then when the child pulls that out, taxes shouldn't have to be paid again. If after-tax dollars are put in, but that's what I mean to say. Where unfortunately, it's one of these things where they're talking about this, but we still have to wait to get some of the details, exactly how some of these. Things will work with these accounts. Um, but the basics is basically when they finally do come out and say, okay. This is where you're going to be able to open up these accounts or how these accounts will be opened. We don't, we still don't know that. I don't know if they're going to start a relationship with one individual company.

• 38:15Speaker 03

  And say, this is where you have to open them up, or if they're going to say you can open them up at any one of the major custodians. Fidelity, Vanguard, you know, some of these different custodians or something like that, or maybe even if we like here at MoneyWise as independent advisors. Will we be able to open up those accounts for our clients and their kids and stuff like that? I don't know that yet. They have not given that direction. So we're also waiting to find out exactly some of the details. Um, on these Trump accounts and how those work. So hopefully that helps you understand a little bit. We'll try to talk about it as, as more direction is given. Um, from these, but it's, it's, uh, it's a long-term savings account. It's like an IRA.

• 38:56Speaker 03

  If the kids never touch it, it could grow to as much as 450, 550,000 dollars. Um, you know, and they'd be ready for retirement without having to really even lift a finger just by participating in. This economy for that long period of a time and using the power of. Compound interest, which is what we talked a lot about.

• 39:16Speaker 04

  18 years, it could pay for all the books for college for four years. I, I could definitely see that happening. I mean, that's a long time. That money to grow and. Um, yeah, we'll keep you posted. Steve, do you want us to take a quick break or should? Tips here. What do you think?

• 39:32Speaker 03

  Yeah, yeah, let's take a quick break. When we come back, we are going to come up with a handful of tips just to remember starting out the year. If you want to kind of revisit your plans, some things to think about and remember, set up some financial goals for 2026, whether you're just starting out, middle of your wealth building road, or maybe even in retirement, you can still apply some of these great tips for being money wise. We'll be right back.

• 39:57Speaker 00

  Money Wise Wealth Management is the only locally owned independent firm that uses a comprehensive wealth tax and estate approach, working closely with a highly trusted CPA and attorney. For information on how Money Wise can help you invest and plan for your future, call 661-847-1000.

• 40:18Speaker 03

  Welcome back to the final segment here of our first show of 2026. Thanks again for making it great. We've had some great comments and questions come in. And like I said, once we got through those, we were going to jump into a few, a handful of just things to remember, to check off the list, to go over where you at with it. Some of them, you know, you've probably heard a million times, but it's amazing that we can always just kind of keep kicking it down the road. And maybe 2026 is when you finally put things into place. And like I said, a lot of these things are whether you're just starting your journey, or maybe 2025 had some things happen and things got shifted around, you got to just refocus on it. So the first one, you

• 41:00Speaker 03

  know, is what everybody always talks about. So cash and emergency fund. Reevaluate it, you know, three to six months worth of savings. What does that look like for you? Some people handle that differently. But what is your cash and emergency fund plan? Make sure you have some of that money set aside and liquid and available for you. Some people have a very consistent paycheck and salary schedule and stuff like that and don't have fluctuating income situations. And so three months is comfortable for some people and some people have big swings. And so six months makes a lot more sense. Uh, some people are fine with putting some of the three to six months in Roth accounts

• 41:44Speaker 03

  because some of that money can be taken back out. So you can evaluate how you handle your three to six months worth of savings. But hey, if your budget's 5,000 a month and that's a comfortable monthly budget for you, then we're talking about 15 to 30,000 dollars. And that is a huge goal. Uh, it's not easily achieved, but it is one of those things, just like with many things. Get it in place and then you can move forward. It's not like something you always have to be working on. You get it put in place and you, and you move forward. Uh, so try to separate that out. Try to have that separated and set to the side. Um, you know, I, I wasn't perfect with this and starting out, it was very difficult as a, as a young family. Um, sometimes I would have to borrow against it a little bit. I would kind of be my own bank and, and you know,

• 42:30Speaker 03

  I'm not saying you have to be perfect with your financial plan, but man, having that money there can really help you navigate some difficult financial times. And I'll tell you what, difficult, uh, seasons of life can really be made a little bit lighter when you do have that little bit of cushion setting there. Uh, man, every little hiccup is way compounded when you have no emergency savings set to the side. So try to make this, uh, an important thing. And even if you're in retirement, even if you're later in life.

• 43:02Speaker 04

  Absolutely.

• 43:03Speaker 03

  Some cash set to the side because a lot of times what I see is in retirement, when people don't have cash available to them, they a lot of times will panic more about market fluctuations and what their investments are doing and different things when they don't have kind of some emergency cash or some emergency funds kind of more readily available. And they're really kind of just looking at their account. It can kind of have a more of an emotional impact there to you. So, so obviously that's where we always start. Reevaluate your cash and emergency fund. What's another one?

• 43:34Speaker 04

  Well, looking at debt and your interest rates.

• 43:38Speaker 04

  Mathematically, you're supposed to pay the highest interest rate first and some people just it's as simple as write down your, who you owe the money to, Best Buy, CityCard, right, then write down the balance and then write down the interest rate and circle the highest interest rate first. That could be the priority. Now, if it's an astronomically big number and you get a little discouraged, then do something like Dave Ramsey's debt snowball. My wife and I did that. It was very successful. You pay the smallest balance first. Once that smallest balance is gone, you take whatever you are paying on it and you snowball or you debt stack it onto the next debt and so on and so forth. That's a little bit more, it may cost you a little more in interest, but psychologically, you build a lot of momentum. Now, here's a really interesting one is call your lenders. This

• 44:23Speaker 04

  doesn't work for federal student loans, but if you have credit cards, auto loans, personal loans, you can always call as long as you've been making your payments. Maybe your credit has gone up. You've had this loan for three years and now your credit's 50 or 100 points higher. Call and negotiate. Say, hey, I would like, I would like to get a lower rate. Getting some offers from some of these other companies with lower rates, what can you do for me? And chances are, they're going to work with you. They don't want to lose your debt.

• 44:50Speaker 03

  There you go.

• 44:51Speaker 04

  Sure.

• 44:52Speaker 03

  So it's another thing to go over. Another one is retirement contributions. So it's the beginning of the year. If you make a small change now, it's not as big of a chunk. If you're wanting to max out a 401k by the end of the year, if you're wanting to increase a little bit now, do it now. Reevaluate how much you're putting into your 401k. Are you doing Roth? Are you doing traditional? Does it make sense to do Roth into your 401k? If you're able to do so, a lot more 401ks allowing you to do that. The quick and easy answer to that is, is if you're anticipating, or you're not necessarily needing a write-off. If you're, if you're a higher earner and you're looking for write-offs, then it would probably make sense to do the traditional. But if you're not necessarily like, you know,

• 45:37Speaker 03

  in peak earning years and you're still trying to build your income up to a much higher level in the future, then, then maybe a Roth account or Roth contributions does make sense right now. It costs you a little bit more because you don't get the write-off. Right off on your taxes, but you're getting to have that money go in there after taxes. And and it gets to come out tax free for you in the future. Um, I, I tell people like, uh, this, you know, increase 1% into your 401k. Just make a small change. It, it will be a little bit less, but you're probably not going to fill it all that much. Um, review all your older accounts. Do you have old 401ks, old IRAs? It might make sense to consolidate those down into the, the least amount of accounts as possible.

• 46:18Speaker 03

  Sometimes people think that having them spread out, that means you're, you're, you know, you don't have all your eggs in one basket. No, that has to do with your investments inside of those accounts. So whether they're in six different accounts or two different accounts or one different account, you diversify your investments inside of that account. So you can be just as diversified in one account as you are in six accounts. And most of the time I see people able to start to do much better planning and management. When you have fewer accounts, because then you have less to go over, you have less to manage. Beneficiary information is easier to manage because you're not dealing with three or four different accounts. Uh, and so, you know, you can do a review. Obviously that's one thing that we go over with people. If they have lots of different accounts at different places is how can we consolidate these?

• 47:02Speaker 03

  In a way that makes sense and make it easier to manage and to understand your financial situation. And how is this going to come together for your financial future?

• 47:11Speaker 04

  Another one, Chris, all the, all the, uh, amounts have gone up for 2026 on how much you can put in all these various accounts. And so if you've been doing 50, 100, 150 a month or 500 a month into your, uh, traditional or your Roth or something at work, make sure that you're increasing that if you're, if your goal is to max it out, make sure you make that little bump. I've been taking care of a lot of those calls already this week with, uh, reaching out to clients, clients, uh, calling in and, and making those small adjustments. You mentioned earlier, uh, percentage increase. This is the time of year, a lot of people get a cost of living increase, one, two, three percent. Just if you get a 3% raise, put a whole full percent away.

• 47:52Speaker 04

  Another big tip is to review your health insurance and your life insurance. Make sure that you have enough life insurance. There's a lot of different schools of thought. The easiest is 10 times your annual income. It's not necessarily life insurance. It's income replacement insurance. Remember that. You can also call and check on your auto and home rates. Especially in California, it's very competitive. I like personally like to stick with State Farm with my local agent, Mike Alexander on 8th Street. Because he, we just have a great relationship. State Farm's always been great. You pay a little bit more, but it's worth it. However, if you're not married to your agent, feel free to shop around at least a couple of times a year and see what you can find.

• 48:36Speaker 03

  I mentioned earlier beneficiaries and documents. So obviously a great time to make sure your beneficiaries are all up to date on every single one of your accounts. Please, please, please make sure to update all your beneficiary accounts. If you have life insurance that you got when you first

• 48:53Speaker 04

  If you got a divorce, that's happens all the time.

• 48:56Speaker 03

  Yeah, if you've been divorced on your employment insurance, make sure you have that updated. Investments, good time to go over thing, the big picture. Taxes, can you be any more strategic? I was going to say that this is also the first year that the 401K, back to contribution limits. This is the first year that they're actually allowing even additional write offs for age 60 to 63.

• 49:22Speaker 04

  Right.

• 49:22Speaker 03

  So 24,500 is under 50. They're allowing a catch up contribution of 8,000 for a total of 32,500. And 60 to 63, they're allowing you to do up to 35,750.

• 49:36Speaker 04

  What do they call that, Chris? What's that? Cause it's the catch up.

• 49:38Speaker 03

  Be money wise.

• 49:39Speaker 02

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