Have you ever wondered whether your retirement nest egg is mired in Tax Drag? If not, it’ll definitely be on your radar after this episode of The Retirement Equals Freedom Podcast.

Host Josh Bretl, founder of FSR Wealth Strategies, is breaking down the intent behind portfolio rebalancing and the difference between sheltered and unsheltered investment vehicles.

We don’t have to live in fear of capital gains or let tax liability on non-qualified investments scare us out of cashing in and enjoying the fruits of the assets we’ve accrued! All we need to do is get our heads out of the sand and create a solid strategy, which is where the professionals come in!

Cohost Dave Schmidt’s portfolio may be heavily tilted towards socks and “Naughty Dip “ingredients, but he still needs to know about mutual funds and why they can upend tax planning.

Tune in and it will all become clear – both how different types of investments have variable tax impacts and why it matters. And even if you don’t wind up following Dave’s recipe, you’ll definitely come away with a better understanding of all the ingredients that go into proactive, tax-savvy investment management. And very likely an undeniable craving for Girl Scout cookies!

Wondering what kept Dave awake through Josh’s rambling? It was a big cup of iced Cometeer's "Counter Culture" roaster. Get $25 off your first order by using this link!

Don’t miss out! You can stay in the loop on all things R = F by signing up for the show’s weekly email at this link!

Click here to learn more about or listen to previous episodes of The Retirement Equals Freedom Podcast. Or join the conversation over at our private Facebook group, which you can find here.

Click here to explore the services that FSR Wealth Strategies offers and schedule a discovery call with one of the team’s CPAs. When it comes to living your best life, it’s never too early to get started!

I'm talking about problems here, and sometimes the

first thing you need to do is be aware of problems, and sometimes

people like to bury their head in the sand and pretend the

problems don't exist, but this money is there for a reason.

You've saved it for a purpose.

If once you save it and you think, I have no way out, or

if I get out of it, I'm going to have a giant tax or whatever

it might be, you just leave it there and you're like, "Well,

that's my kid's problem," or whoever it might be.

Well, why'd you do it in the first place, and why not use

this money for your benefit?

Why not have a plan in place to make it beneficial to you and

to your family and to your kids, and things along those lines?

You don't have to live in fear of capital gains,

and don't let tax liability on non-qualified investments

scare you out of cashing in and enjoying the fruits of the

assets that you have accrued.

You just need to pick your head up, get it out of the sand,

and create a solid strategy.

Which is where today's episode picks up.

We are going to learn about portfolio rebalancing and the

difference between sheltered and unsheltered investment vehicles.

And tax drag?

Yeah, it's a thing and it will definitely be on

your radar after hearing Josh's thoughts on it.

And while I personally may be tilted towards socks and naughty

dip ingredients, I still need to know about mutual funds and

how they can upend tax planning.

This is The Retirement Equals Freedom Podcast.

Your host of the show, Josh Bretl, is the owner

of FSR Wealth Strategies.

For the last few decades, he has been helping fine folks

like you make retirement the best part of your life.

And me.

Well, hey there, I'm Dave.

Josh's longtime friend, co-host of the podcast, and

huge fan of Tom Servo, Crow T Robot, and the rest of the

crew on the Satellite of Love.

All right, enough about me.

Let me let you let me end my introduction so

we can start the show.

​ FSR Wealth Management is a

located in Elmhurst, Illinois.

Information and opinions contained in this audio

have been arrived at by FSR Wealth advisors.

All information herein is for informational purposes

and should not be construed as investment advice.

It does not constitute an offer, a solicitation or recommendation

to purchase any security.

FSR is not providing legal, tax, accounting, or financial

planning advice in this audio.

These views are as of the date of this publication

and are subject to change.

David, it's an exciting week.

Why?

Tell me why.

This table that we've been waiting for since

Thanksgiving is finally here.

Thanksgiving or much earlier than that?

Yeah, I think it was earlier than that, but do

you think this table's going to make the podcast better?

Well, it's hard to improve something

that's already perfect.

Now, we have no more excuses.

We better make some darn good podcast.

Yeah.

Josh, we got this beautiful table.

I'm a little warm.

We got a light behind us here, and I got this warm FSR

thing that you made me wear.

You look good though.

Oh, I appreciate that.

So do you, Josh.

Thanks.

That gallbladder removal was the best thing

that happened to you.

I had a 20-pound gallbladder.

I'm 20 pounds lighter.

How about that?

Dave, in the last episode, we talked about

something, and I meant to have it here for you today.

I don't, but hopefully, on our next episode, which

I think we're recording tomorrow, actually.

The Girl Scout Cookies are in.

That's going to be a huge hit.

You did promise a picture of this alleged 1,900

boxes of cookies in your front room though.

I was off by 200.

It was only 1,700 boxes of cookies.

Oh, my gosh.

I didn't get a picture because we had

it spread out throughout the entire first floor due

to construction issues.

Missy, my wife, is the cookie coordinator for

her Girl Scout troop.

Now, let me put this in perspective.

By Girl Scout troop, these are Daisies.

These are first-grade girls.

There's 20 of them.

They started selling Girl Scout Cookies two

weeks before Christmas and finished mid-January.

They sold for a month, the worst month possible

because from two weeks before Christmas, no one wants to

buy more Girl Scout Cookies.

No.

Not at all.

I don't know why they do it that time of year.

Kids and girls sold some, but some girls

sold a ton of cookies.

Now, my wife is really organized and she doesn't

like people who aren't.

I'm amazed she likes me at all.

But on Saturday morning was cookie pickup for the

entire city of Elmhurst.

So, every Girl Scout troop in Elmhurst went to Sandburg

Junior High to the parking lot in the back of the school to

pick up Girl Scout Cookies.

We had the 8:45 pickup time.

It started at 8:30 with the 8:45 pickup time, and they give

you a sheet of how many boxes any type of car will hold.

Okay, interesting.

We have a minivan.

We emptied out the seats in the minivan so that it's wide open.

We have another friend with a giant SUV, and then

we had my smaller SUV.

Three of us go to pick up these cookies and

these cars are packed.

Now, I pull in the Sandburg parking lot.

There were three semi-trucks full of Girl Scout Cookies

for the city of Elmhurst.

My gosh.

Elmhurst is not a big town.

I mean, we have a lot of active kids, but 18-wheelers.

We're talking-

Three 18-wheelers.

Dear Lord, it's a racket.

Now, I didn't get to see how full they were, but

I couldn't imagine you'd bring more than one if the other

two of them were almost full.

You're not going to pay for a semi

unless it's stuffed full.

I was thinking that's just one city.

Imagine Chicago and the rest of the country.

That's a lot of Girl Scout Cookies.

I thought Maggie alone sold 1,900

boxes, so that's why-

No, no, no.

I was a little more like, "What?"

No.

No.

Between 20 girls, 1700 boxes of cookies.

Ooh, that's still not a small number.

You will probably have yours tomorrow.

Missy's been organizing them and getting them out, so-

Awesome.

if you don't, you can yell at her.

The construction at our house is actually done, right?

Remember, I've been showing you pictures today.

They've clean it up today, but we've had construction stuff

everywhere, and then piles of Girl Scout Cookies for other

Girl Scouts to come pick up, so it's been kind of funny.

That's what you need in your house that's been a

disaster zone for the last four months, just boxes of cookies.

You know what's gotten us through it, Dave?

Yeah.

Coffee.

Dave Schmidt:

Speaking of coffee-

I noticed you had a pod in your hands.

Yeah, it's Cometeer Counter Culture.

It's the roaster for this particular blend.

I forgot which blend I'm drinking, Josh.

It's delicious, but it's purply, and I made it ice today

because I love me some Cometeer.

I feel like you're really loud today.

My ears have you really loud in them.

All right.

Let's just be fair though.

I'm a little not sure how to talk in this new setup.

I'll turn your headphones down a little bit.

I don't feel like I'm too loud in my ears.

I feel like you're too loud in my ears.

Yeah., That's why I'm turning

down your headphones here.

Oh, all right.

Do I have time for one more cute story?

Yeah, of course you do.

Or should I wait for tomorrow's podcast?

Josh, we don't even have to talk about

anything financially related.

If you just wants it to be cute stories, that's fine with me.

I had cute stories today.

I'm in a really good mood today.

I know.

I can tell.

So-

Thanks for sushi, by the way.

That's how good of a mood you were in.

Yeah.

Normally I'd worry that my wife would hear that because

sushi with Dave at lunch, sometimes she gets jealous,

but she doesn't listen to the podcast, so we're good there.

No one tell my wife Dave and I had sushi today.

You know I'm talented in some areas.

I'm not talented musically.

I have zero musical talent.

Missy has about the same.

Alex, my son, who loves and we won't let him listen to

the Retirement Equals Freedom Podcast anymore, has become

obsessed with the guitar.

Right.

He was taking lessons.

Taking lessons.

He now owns the guitar we got.

He wanted to practice at home, and how are you

to say no to a boy who wants to practice at home?

I didn't think he'd actually take it seriously, but

in their lessons, they are learning a song and

it's one of my favorites.

You ready?

Yep.

So, that is The White Stripes,

Seven Nation Army.

It's one of my favorite songs.

I've known you a long time.

I never knew you liked The White Stripes.

Well, that's because I didn't know what that song

was actually called until Alex came home, and he goes, "Dad,

I'm learning Seven Nation Army."

I go, "Cool, what's that?"

He goes, "You know..."

I was like, "Oh, that one."

So, now, I looked it up and I wanted to play it,

but I thought, "How are you learning that already?

You've had three weeks of lessons.

How is that possible?"

I thought maybe he just had an amazing teacher or he

had some sort of weird sick ability to learn the guitar.

No, no, they tell him he's playing that, and I don't

know what noise is actually coming out of the guitar, but

he's really into it and he loves it, and it's kind of

cool to see him going with it.

He gets the fingers going and it's kind of cool.

It's better than when I played the trombone in fourth grade.

Right.

I played to clarinet.

Now, how is Zachy and his harmonica doing?

Zachy and Maggie said they're going

to be part of Alex's band.

He can play the guitar.

Maggie's going to sing, so she can scream into the

microphone, and Zach's going to be the harmonica player.

I mean-

I can't wait for that podcast when

we bring those three on.

Dave-

Yeah, Josh.

Yes.

We were discussing what we want to talk about

today, and over the last few episodes the last couple months,

we've spent some time on social security and 401[k], Roth

conversions, Secure Act 2.0.

We've gotten really tax heavy and taxes are super

important, but I want to talk about something we

have not talked about, but it's still tax related.

Hashtag tax nerd.

I can't get away from it.

This has to do with people's investments.

When we pick investments for people, when you're

picking investments inside of an IRA or 401[k] or Roth

IRA, it's actually a lot easier than when you're not.

Yeah.

The dumbfounded look is well deserved on that one.

So, imagine you have this IRA, or you have this

401[k], or even this Roth.

Sure.

Yeah.

Now, your picture, it's like a box, and inside of this

box, you can pick whatever investments you want.

I dreamed of this moment.

You do and one of the things or variables

you don't have to take in consideration or at least not

very heavily is the tax impact internally because you know

in a Roth, all the growth is tax-free, or inside of an IRA,

the transactions inside of the investments aren't taxed.

Okay?

But there's a large number of people that have some

significant assets that aren't inside of an IRA or 401[k] or a

Roth IRA or anything like that.

So, they're in what we call non-qualified

or brokerage accounts.

I was hoping you would take a longer break, so

I could answer that because I actually knew the name of those.

If you wanted me to breathe, you just say breathe.

So, you can say that.

Should we do it again?

Yeah.

Those accounts that aren't inside IRAs.

Would those be called like...

Well, cool kids call them NQAs, but non-qualified

accounts, Josh?

Non-qualified.

Actually, we just call them NQ, non-qualified.

Oh, you just dropped the A's.

Okay.

But you're right, Dave.

That is what the cool kids call them.

When we have money inside of non-qualified accounts,

we're not just looking at the diversification, the

tax, the investment holding.

we have to take into consideration the tax

impact that we have there.

Don't we always though, Josh?

I feel like it always is about taxes.

It always is about taxes, but this is

something people forget.

Advisors forget about this.

So, let me put something in perspective here.

There's a theory out there called tax drag.

Doesn't that sound sexy?

I mean, if taxes weren't depressing enough, you

add the word drag after it.

This is tax drag.

Tax drag is the impact, the negative impact

on an investment.

If you didn't have that tax drag, that's how much

better your investments would perform with everything

else being the same.

So, the same investments inside of an IRA versus not an IRA, you

could be losing 1% to 2% a year in tax drag, and that's just an

estimate based from Morningstar that comes out to play.

So, sometimes I actually think it could be higher.

MorningStar, they make breakfast sausages.

Oh, do they?

Yeah.

I thought that was Jimmy Dean.

But there's also a MorningStar brand.

They also do tax stuff like-

no, Morningstar is probably the preeminent

investment research company.

Preeminent is the wrong word.

It's one of the largest investment research

companies in the world.

If you haven't heard of their breakfast sausage though,

it's delicious For example, if you have an investment

that pays you dividends...

Dave, do you want a dividend is?

We talked about this before the show.

We did, but I got to be honest with

you, I was shoving my face full of sushi, so I kind of

was half paying attention.

A dividend is profit that a company earns.

So, if Apple earns a profit or any company, any stock

you own earns a profit, the way a shareholder gets their

part of the profit is from dividends that come out.

So, if an investment pays dividends, those

dividends are taxable to whoever receives them.

So, receiving dividends is a good thing because

hey, you got income, but B, that income is taxable.

So, there's a negative to that.

Not all investments pay dividends.

There's two ways that investments grow.

They grow via dividends or income.

Some of them will pay interest or things like

that, but they also grow via capital appreciation.

Amazon is a great example of that.

Amazon doesn't pay dividends, but their stock price

keeps going up and up.

Amazon is not going to have as much tax drag as a

blue chip company that pays large dividends like an

AT&T, something like that.

Blue chip?

Blue chip means some of the larger old-school large

companies out there that have been around for a long time.

They call them blue chip.

Sometimes those dividends can become negative.

Now, I really want to focus though on mutual funds.

We've talked a little about mutual funds in the

past, in prior episodes.

Mutual funds are an excellent way to diversify your assets.

It allows you to hold multiple investments with just one in

holding, but mutual funds can be extremely tax inefficient

as well as expensive.

So, mutual funds cost money, and the different kinds of

internal causes, the overhead cost to own mutual funds

can be anywhere from 0.25% all the way up to 1.5%.

So, on top of what your advisor charges you, they might also

be charging mutual fund cost.

That's money that you don't have to pay, and that's not

tax drag, that's a fee issue.

But then, inside of the mutual fund, you have no

control over what happens.

So, companies that pay dividends that are held

inside of a mutual fund, those mutual funds distribute the

dividends to whoever owns it.

So, if you own a mutual fund and that mutual

fund receives dividends, you're going to get it.

That shows up in your tax return and you know that.

That's okay.

So, there's income producing dividends.

There's mutual funds that focus on dividends.

There's mutual funds that don't, so things along those lines.

But then something else that's actually more tragic

that occurs is that mutual funds will have what we call

capital gain distributions.

All right?

Give me a second on this one because I'm

going to set it up here.

Capital gain is when you buy something for one price.

Let's say you bought it for a hundred and it's

sold for a higher price.

You sold it for $150.

The capital gain is the difference between

what you bought it for and what you sold it.

So, that case would be $50.

That amount is taxable to you.

And people understand that.

The people are okay with that.

But mutual funds are weird because you can buy a mutual

fund, hold onto it forever and have to pay capital

gains every single year on it, which is weird because

what happens is inside that mutual fund, they are

constantly buying and selling their internal investments.

So, when they buy and sell, those capital gains like

dividends get pushed out to the people who own the mutual funds.

Last year, 2022, I think people are in for a really

rude awakening when they do their taxes this year, and that

is because last year, 2022, the stock market was down.

Almost every single person, if you're invested in

stocks, lost money last year.

But that in theory, we you would think, "Hey, one

benefit, no capital gains."

But another thing that occurs when stocks are down the way

they were, a lot of investors will flee mutual funds.

They'll sell their mutual fund, and when they do that, the money

manager of the mutual fund has to sell their investments inside

that mutual fund in order to pay the people money who want out.

Well, that's going to trigger internal capital gains.

So, they'll have capital gains inside those mutual funds

that they have to distribute.

So, you may have lost money on your mutual fund.

Your mutual fund could have gone down 10%, 15%, 20%, but

you're still going to pay a capital gain distribution,

and it could be huge.

I think it's going to be a really rough year

for people in those.

So, that's a tax drag that occurs inside

those mutual funds.

I think I made the right decision not investing in

traditional stocks, but instead investing in Bombas socks.

Do you mean the Bombas socks stock

or the socks themselves?

No.

I mean, you say stocks.

I'm just thinking of socks and how comfy my Bombas.

Some people say Bombas.

I say Bombas.

Bombas?

Yeah, Bombas socks are right now.

So, I'm kind of dozing off as you're talking

about these mutual funds.

I'm like, "Stocks equals socks."

Well, I don't think there's a sock mutual

fund, but if there is, it's-

well, find it.

all yours.

Thank you.

But a lot of this can be very inefficient,

and a lot of these distributions are paid out

towards the end of the year.

So, all of a sudden, you do your tax planning in

October, November, and-

it sneaks up on you.

It sneaks up on you in December.

In December, boom, you're hit with this giant capital gain.

Is there any way to predict it?

There is.

The mutual funds will start putting some predictions out,

come Octoberish and they'll tell you the dates are going

to be declared, all that stuff, but until they actually

pay them, it's not final.

So, you have to really think about that because

there's some serious tax implications inside of those

accounts when that occurs.

It can be extremely inefficient when that happens.

Let's just put this into perspective.

If you hold a mutual fund that pays a $50,000 capital

gain, which is not unheard of, that could be very common.

$50,000, if you pay a 15% federal tax, a 5%

state tax, that's 20%.

All of a sudden, heck, you just lost 10,000 bucks in taxes.

And yes, in theory, in the future, you don't pay that

money in the future, but all said and done, you'd rather

not have to pay that money.

Now, the one thing that your favorite breakfast sausage

company does not look at, they don't look at the capital gains.

For that, you have to go direct to the mutual fund itself.

Jimmy Dean?

Jimmy Dean and the Jimmy Dean fund.

They have a much better sausage.

I like the Jimmy Dean.

Now-

By the way, not to go on a tangent, but I'm going

to go on a tangent, have you tried my naughty dip before?

Dave, this is a clean podcast.

Oh, I know, but it's a naughty

dip I serve at parties.

No, I am not sure.

Maybe I have.

Well-

it's real simple.

What's that?

A log of Jimmy Dean sausage.

A log.

A log.

Do you cook it?

A brick of cream cheese, a can

of RO-TEL tomatoes, cook them all up in a pot.

Dip big Fritos into it.

You'll thank me later.

Dave, this could be a cooking episode

for our email subscribers.

You think so?

Dave's naughty dip?

Dave's naughty dip.

I think that'd be a lot of fun.

Yeah.

You're doing all these sophisticated cocktails.

I'm like, "Let's do some sausage and cream cheese."

It's on brand.

Now, let's get a little bit more in depth here.

Please do.

Why are we talking about all these things, Josh?

Why are we talking about this?

Yeah.

Why are we talking about this because it

seems pretty negative?

I'm talking about problems here, and sometimes the

first thing you need to do is be aware of problems, and sometimes

people like to bury their head in the sand and pretend the

problems don't exist, but this money is there for a reason.

You've saved it for a purpose.

If once you save it and you think, I have no way out, or

if I get out of it, I'm going to have a giant tax or whatever

it might be, you just leave it there and you're like, "Well,

that's my kid's problem," or whoever it might be.

Well, why'd you do it in the first place, and why not use

this money for your benefit?

Why not have a plan in place to make it beneficial to you and

to your family and to your kids, and things along those lines?

One thing people worry about is they look at the mutual

funds, get out of mutual funds.

They'll say, "We're getting into stocks,"

or they'll say, "Hey..."

Especially what we've seen in the last 10, 15 years,

the last year was down, but if you've held stocks for

a long period of time, then you've seen large gains.

So, let's say you bought Amazon 10 years ago and you

put 50,000 bucks into it.

That's a lot.

Maybe you put 20,000 bucks into it and it's now worth $200.

Well, the difference on that is taxable to you.

So, people's thought process is, "Well, I'm

just not going to sell it.

I'll just hold onto it.

If I hold onto it, I don't have to pay the taxes."

Which is true, you don't have to pay the taxes, but

you just lost use of all that money, and that to me

is really counterintuitive.

You're cutting off your arm to save your finger.

Yeah.

Why'd you do it in the first place?

You invested that money for a reason.

That's a good problem to have.

Let's celebrate this.

Let's do something cool with it.

I like to tell people, here's the issues that we have.

Here's the issues we want to address, and quite often people

aren't thinking about them.

The reason we talk about this is because I want

you to use your money.

I want you to use it in its best purpose and for

whatever you want to achieve.

We call it the Retirement Equals Freedom Podcast.

We don't call it the Retirement Equals Don't

Use Your Money Podcast.

I mean, you want that...

That was really kind of cheesy.

But you want that to be for your own good.

I don't know why I feel like I have to look at

you as I talk, but I do.

But that money's there for a purpose.

I told this beforehand, this is going to be a two-part series

or two-part episode because I want people to understand

that they can use and they should use their money.

So, in the next episode, we're going to talk about how

we fix all these problems.

What can you do if you want access to that money?

You don't want to have to die with it.

You want to have it for your life, or maybe

you don't realize that possibilities are out there.

Why must you needlessly complicate everything?

I simply ask, why are we talking about

all these negative things?

And 18 minutes later we get the answer.

That was an important answer.

I know.

I'm just messing with you, Josh.

I'm just messing with you.

Cool.

All right.

What else we got here?

Oh, we are going to talk about

one more problem here.

Mo' money, mo' problems.

More money, more problems.

Now, let's talk about the theory of rebalancing.

Do you want to hear my theory of rebalancing?

Yeah, you got a theory on rebalancing?

It's not appropriate for this

podcast, but I do.

Well, you already talked about your naughty dip.

Yeah, I did.

Now, here's what a rebalancing is.

Okay?

A rebalancing is something that's technical in an

investment nature, meaning, "Hey, I'm going to have

5% of this, 25% percent of this, 13% of this."

And you're planning your diversification, and when you

plan out a diversification, you also plan out a tolerance.

Because investments go up and down, so you're going

to say, "Hey, I want between 5% and 8% of this, and I

want between 7% and 9% of this," whatever it might be.

And if it gets out of those tolerances, quite often,

a rebalancing will occur.

Does this have to do with risk?

It helps limit risk.

Actually, there's some really great studies to prove the

benefits of rebalancing, and sometimes rebalancing

occurs just on time.

They say, "Hey, we're going to rebalance every quarter,

every month, every year."

And they're going to say, "Every month, we're going to rebalance

to this threshold, 25%, 25%, 25%," whatever it might be.

You can come up with that.

But those rebalancing triggers buys and sells.

We already talked about the capital gain distributions.

Sometimes those capital gain distributions occur when

you're buying and selling.

So, what we look at is we say, "Hey, inside of a mutual

fund, you can't control when they're going to rebalance.

You can't control."

Hey, this got out of whack and we're going to rebalance

this way or because of time they're going to rebalance.

All of a sudden those will trigger capital

gain distribution.

So, when we have highly volatile years, those capital gain

distributions can occur as well.

Does that make sense?

Yeah.

Whenever you say control, I think of, just own it baby.

You ready for a sneak peek of

next week's episode?

Always.

With technology, nowadays, mutual funds

have become less important.

You can own these assets yourself.

The S&P 500, we can own it for cheaper than

buying a mutual fund.

And then, you have more control.

You've got more control over the rebalancing.

You can set the limits.

You can set the thresholds.

There's some really neat studies that show if you change

the tolerance from a 5% to a 10% rebalancing, you don't

actually negatively impact the performance long term,

but you can have a huge impact on decreasing the tax track.

And when you're part of the mutual fund, guess what?

You don't own that.

You don't control that.

But when you own it individually, boom.

That boom really sounded stupid.

I'm actually happy.

I have a note here.

I'm glad you brought the S&P 500 because I do have a note

about the S&P 500 because-

you wrote a note about the S&P 500?

I did and you'll find out why because I'm

reading through these things.

I'm getting nervous that we may have too much invested in our

Arby's Beef and Cheddar fund-

what?

to where we'll be taxed so much.

See?

Well, even with the increasing prices of

the beef and cheddar, it's no longer five for five.

I know.

It's like five for six or five for seven.

But the beef and cheddar fund was trending on the S&P 500.

I don't know if you saw that.

I was reading that yesterday.

Wow.

Mm-hmm.

On the Twitter.

Yeah.

Arby's beef and cheddar.

It's a fund.

Yeah.

I didn't know if you knew that.

Compliance is going to love this episode.

Hi, Debbie.

Dave, we've talked a lot about the problems.

I gave you one little solution that's kind of a tidbit for

next week in how we implement that, but I think next week...

Not next week.

I think on the next episode, we're going to really shine

some light on some things that you can do to take

advantage of the tax situation to minimize the tax drag.

Everyone's looking for a bigger rate of return.

People are looking for the next investment.

Should I be in Amazon or Apple?

Should I be in Sears or Montgomery Awards?

Should I be in whatever and whatever?

Should I be in the Retirement

Equals Freedom Podcast?

Right.

Yeah.

I mean, our stock is huge, but they're looking for that

extra 1% to 2% in performance on their investments when

just get rid of the tax drag can make a huge difference

inside those investments.

All this tax drag has got me dragged down.

Yeah.

What?

What?

Okay.

[singing].

To the escalator.

[singing]

Oh, yeah.

We got more room back here to dance.

Well-

we do.

we will.

We're standing.

We're getting there.

We're really getting there.

It doesn't matter because we haven't put anything

up on YouTube yet.

That is true.

My big question is, are you prepared with a question?

I am.

I thought I caught you off guard.

Nope.

Okay.

I'm prepared.

By the way, were you done talking about

all these more problems?

Because I just kind of cut you off at the knees.

Yeah.

Well, I don't think if he wants to hear anymore about

the problems of owning assets since I have a taxable account

without thinking about it.

I'm watching her ticker.

I'm like, "Yeah, if they haven't tuned out by now..."

All right, Dave.

Yeah.

This is a really deep, really important Get

to Know Josh & Dave.

Deep thoughts by Josh.

What's your favorite flavor of Girl Scout Cookies?

Really?

Yeah.

Oh, man.

I'm excited.

Let's try these two new ones that we were talking

about the other day.

Other than a freshly made piña colada I loathe

coconut, but Samoas, there's something about Samoas.

Caramel, chocolate, coconut.

Oh, yeah.

Now, we're talking.

Yeah.

I love them all.

Don't get me wrong, but Samoas feel like a guilty pleasure

that once a year I'll have them.

Oh, yeah.

Now you did the other episode

say frozen Thin Mints.

Yeah, but I'm going to make a surprise.

I love frozen Thin Mints, and I didn't realize this, and

you guys got to discover this.

There was a s'more flavor that got introduced a few years ago.

I love s'mores.

I love all things s'mores.

I didn't realize that there are multiple Girl Scout bakeries in

the country, and in different regions of the country, there's

different s'more cookies.

Wow.

Mm-hmm.

We were actually up in Michigan.

You and I, with our friends a couple years ago, and

we no longer invite Chris up to Michigan anymore.

Just don't tell them about it.

But we were out for breakfast and there was a little girl

selling Girl Scout cookies at the breakfast restaurant,

and we bought a box of the s'mores, and they were the

non-Chicago s'mores, and they are out of this world.

So, I like the s'more cookie not made in Chicago.

If you are somewhere in the country and you want to send me

some of the non-Chicago s'more cookies, I would love that.

They're covered in chocolate and they have a graham cracker

inside and a marshmallow middle.

Oh, my god, they're out of this world.

The Chicago ones are not terrible-

they're not bad.

but they taste-

they're good.

more like a duplex, and

they do a true s'more.

Yeah.

The Chicago ones are good.

I'm not saying I don't like them.

I'm just saying my favorite are the non-Chicago

made s'more cookies.

If non-Chicago made s'more cookies were sold

in Chicago, we'd be saying things like, "Ain't nobody

got cash for that," because all of our spare cash would

be going to s'more cookies.

All right.

Yeah, that's good.

What?

There was something else.

Oh, yeah, Dave Relates to Retirees.

Yeah, DR2R.

It's time for DR2R.

Josh, are you ready?

As ready as I'm going to be.

I'm going to have to admit something to you.

Today's DR2R was somewhat inspired by our good friend

who emailed us a few days ago.

Huh?

Do you remember who that was?

I do.

Mr.

Mark Thomas-

Señor-.

the rebounding king of York High School.

He was called?

The dirtiest player I've ever met.

He was called the rubber band of our team

by the Daily Herald, rubber Band or the Glue because

he held us all together.

I can't remember.

But he wrote it in a pretty-

it's not because he's tall and

lanky and stretches real-

and awesome.

Yeah.

He wrote in a pretty feisty email asking for

more credit for me when I talk about the different ways that

I was able to score points.

He just wants more credit.

So, Mark, here's your shout-out if you will, but

Dave relates to retirees.

Here's how I relate it.

Mystery Science Theater 3000.

Yeah?

Okay.

MST3K.

For those of you that aren't aware of MST3K-

right here.

Yep.

All right.

This story goes like this.

Joel is trapped on the satellite of love and shot out into outer

space as part of an experiment run by the Mads, M-A-D-S.

The experiment is to see if they could drive one person

insane by forcing them to watch a bunch of really bad movies.

That's the plot of the show.

Joel watches these bad movies by himself and

decides, this is boring.

I'm going to build some robots.

So, he builds Crow T.

Robot and Tom Servo.

And together they watch really bad movies on

the satellite of love.

Joel and his robots have no choice.

They are trapped on the satellite of love.

See where I'm going with this?

I hope so.

Joel is unable to fix his situation.

He's in outer space.

He cannot get out of this predicament.

What I'm trying to elude is this.

Elude, did I use that correctly?

Mm-hmm.

Mm-hmm.

Okay.

As much as any MST3K listener or watcher

can elude to anything.

You had a frog in your throat right there.

I did.

Yeah.

So, dear listener, retiree, soon to

be retiree, what I'm trying to say to you is this.

Do not be like Joel and his robots.

You do not have to be stuck on the satellite of love, or

you don't have to be stuck with all these taxes for NQAs.

Seek out help from somebody that can help you with these NQAs.

So, that dear friend, is how I relate to retirees.

For those of you who are familiar, secret agent, the

super dragon, Josh, you can have your full house moment

now because I know you're going to go home tonight.

Pump up Netflix and watch MST3K.

I'm really glad you tied that together at

the end because for 99.9% of that, I was going,

"What is he talking about?"

I have never been so lost.

Yeah.

It's pretty simple, Josh.

It comes down to choice.

Joel had no choice.

Retirees, you have choices.

You need to own your retirement and find

someone that can help you.

You know, Dave, you said it for me, but let me

back up a step and needlessly complicate everything.

Growing up with you, I watched you play video games.

I wasn't bored.

We've sat there.

We've talked.

We had friends.

When Mystery Science Theater came on, I would leave.

I would leave.

I don't care about it.

I don't watch it.

It has no interest to me whatsoever.

So, when you were talking about that, I didn't even know the

concept to the plot behind it.

So, I didn't follow most of what you said, but the ending I

did, and you are exactly right.

Just because I don't understand it, just because I quite

frankly don't enjoy it, doesn't mean it doesn't exist,

and it doesn't mean that you're stuck sitting there.

So, like you said before, Joel, get yourself together.

You're not stuck there.

You don't have to watch these horrible movies over

and over and over again.

Do what I do and leave Dave's house.

You don't have to do that.

But also, as Erin likes to say, just because you're in a place

now, it doesn't mean you're going to be there forever.

There are ways to fix it.

You just may not know it yet.

How you got there doesn't need to be your future.

A lot of people have gotten to where they are in retirement

and they're quite successful, or at this point in life and

they're quite successful, and they think that how they

got there is how they're going to get into the future.

So, if you did it yourself, if you have an advisor who put

you in that spot, it's okay to ask for a second opinion.

There's just things that have become more complicated, and

unfortunately, as life goes on, life needlessly complicates

it for us kind of like...

Why must you needlessly complicate everything?

Kind of like MSTK3000.

Mm-hmm.

MST3K.

Yeah, whatever.

That's fine.

It all works.

I give you props for trying.

And NQA.

All right.

Do you remember the names of the robots?

No.

No.

Not at all.

You're going to see a picture of them

in next week's email.

I look forward to it.

Crow T.

Robot who is inspired by a bowling pin.

I mean, we are recording on the longest episode

ever, and we're going back renaming robots right now?

Yeah.

And then, Tom Servo, who's inspired by a gumball machine.

So, it'll all make perfect sense.

Oh, I mean, this is better than slip job, and

who was the video game people you talked about last time?

Oh, my gosh, ToeJam & Earl.

Oh, yeah, that's right.

Which by the way, just wait until you hear the

end of ToeJam & Earl, or I'm sorry, the end of the episode.

It's going to be fantastic.

Dave, that was a long episode.

We went through a lot of really minute stuff and was fun.

Next week or next episode, I should say, we're going to have

some solutions for people, not just problems because I hate

when people tell me problems and don't give me solutions.

So, like your Dave Relates to Retirees, we're going to

teach people how that they can actually just get up

and walk out of your house.

Oh, snap.

Ooh, man.

Although, if there's Puddin' Cakes there,

we're really in trouble.

But with that, if you do see this and you feel stuck, you

have money that you can't use because there's a possible

taxation on it, let's talk.

Talk to someone who knows what they're doing.

The person who got you here may not be the one that needs to

take you to the finish line.

That's deep, man.

Yeah.

Like Joel leaving Earth's orbit,

Josh and I, will say bye.

Bye.

It ain't supposed to be commercial, man.

It's jazz.

Well, how would you describe jazz anyway, Tom?

Oh man.

If you have to ask, you'll never know.

Yeah, whatever.

Let's go.

Let's win.

Right Daddy.

One A two, A 1, 2, 3, 4 Secret Agent.

Super Dragon, take it Crow Daddy.

Secret Agent Super Dragon.

Yeah, grab an 8, Joel.

Secret Agent Super Dragon.

Now Secret Agent-

Oh, wait, wait a second.

Uh, I mean, it just goes on like that, huh?

Uh oh.

Crow takes a trumpet solo now.

I, I, I only picked up the

trumpet a few minutes ago.

I only know two notes.

Yeah, that's not my fault if you

chops ain't together.

Hey, chop on this pal-

like red, wait to say Cut it out.

Guys.

Listen, I've-