They are the single biggest savings tool we have available to us. Are you using them effectively? That’s the question Host Josh Bretl explores on this episode of Retirement Equals Freedom, which is devoted to all things 401k:

• How they work.
• Who can contribute.
• Ways to make and monitor investments inside them.
• When it’s okay to withdraw funds from them – and how.
• Plus insights about #TaxNerd implications and an interesting loan option.

You’ll come away from this episode with a whole new depth of wisdom about 401ks and why they are such a valuable – but often misunderstood – vehicle for the kind of financial growth that adds up over time to the kind of robust retirement nest egg we all want to have.

And, on an irrelevant side note, if you doubt that there are harmonica players out there making good money as well as beautiful noise, listen to "Re: Stacks," (a Bon Iver cover), performed by legendary harmonica player Grégoire Maret. As promised by Co-Host Dave Schmidt on the show, you can find one of his favorite harmonica-featured tunes of the moment here.

Like what you’ve heard? Want to spread the word? Send your friends to this pod link resource with all the latest and greatest about Retirement Equals Freedom and one-click access to your favorite platform for listening!

It's a new year and Cometeer is back in stock at the FSR freezer! Get $25 off your first order when you click this link.

And don’t forget to join the conversation at our private Facebook group, which you’ll 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!

401k plans.

You've definitely heard of them.

You may have had one in the past, and if still

employed, you may still be contributing to a 401k plan.

But are you using these really powerful savings

tools effectively?

401ks can be quite ... Not quite, 401ks

are the single biggest savings tool that Americans have.

Most people use them, very few people know how to do it

effectively, and they let a lot of emotion come into play.

And they also think they don't have a choice of what they can

or can't be doing with it as they get closer to retirement.

That's Josh Bretl.

He's the owner of FSR Wealth Strategies.

For the last 20 plus years, Josh's sole focus has been

to help fine folks like you, make your retirement

the best part of your life.

Next up in the episode, Josh talks about employer matching

and profit sharing, two great benefits of these employer

sponsored retirement plans.

We then follow that up by talking about the ways your

money can get into a 401k plan, and how you can get your

money out of, a 401k plan.

Now let's talk about how money goes in.

It has to come out of your paycheck, you can't write

a check for it, it's got to come out of your paycheck

as a payroll deduction.

And it can go either in pre-tax, you know traditional 401ks.

Or most 401ks now actually offer Roth options too, you

can put money in post-tax.

Now, you have that choice.

Now how you get money out is plan dependent, but

there are also IRS rules.

One of the big IRS rules is the 59 and a half rule.

So when you take money out, if you take it out prior to age

59 and a half, you are going to pay a penalty on that money.

If it's a traditional distribution, it's going to

be taxed plus the penalty.

If it's a Roth distribution, the gains will be

taxed plus the penalty.

Now, there are some exceptions to those

penalties, which we do bring up.

And to end our conversation on 401ks, Josh and I talk

about the pros and the cons to employers offering multiple

401k investment options.

These options have given the average Joe power to

make some pretty serious investment choices.

And if you're unable to remove emotion from the equation,

you could be looking at some pretty stressful times ahead.

Now, the market and "professional investors",

they're really good at taking emotion out of the equation.

They're not selling when it's low and buying when it's high,

they're making good decisions, but it's not their money.

So when they created these 401k plans and they gave

people the ability to put money away, what they also

did is they gave people the problem where they had to watch

their money go up and down.

So people were making emotional decisions inside of 401k plans.

And I think people are starting to realize that this is

something that you can't just set it and forget it, you really

got to pay attention to it.

And at the same time, try and take emotion out of it

as much as humanly possible.

We end our 401k conversation talking about

in-service distributions.

And as always, we have to have some fun because no one's got

time to listen to a boring financial podcast, uh uh!

And speaking of we, who am I?

Hey, I'm Dave.

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

huge fan of the Buffalo Bills.

With that being said, let me let you let me end my introduction

so we can dig into all the nitty gritty of 401k plans.

FSR Wealth Management is a registered investment advisor

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.

Erin and I just got back from one of our

annual conferences, Erin and Sean and I went, and it

was probably 1200 people.

600 ... Or 400 financial advisory offices.

And it was kind of a year end recap, get used to the new year.

And we actually got a compliment on the podcast.

Oh, tell me more.

So, yeah, I was talking to one of the

guys I know there and he says, "I try and listen to

as many podcasts as I can."

And these are all financial advisor podcasts.

He goes, "Yours is the only one I actually enjoy listening to."

And he goes, "I've never met Dave, but I think

I'd like him a lot."

Did he really say that?

He did.

Erin wasn't there for it, though.

Okay.

Oh, this was awful, Dave.

So we get there, we're out in San Diego, it was beautiful.

Actually, that day it was raining miserably.

But we're staying at ... I'm not going to mention the hotel,

but we're staying at ... And it's a top brand hotel.

And we go to check in and about half an hour before we

got there, their internet and computer systems went down.

That could be a problem.

It was a problem to the fact that that

was 10:30 in the morning.

We had a black tie, semi-formal event that evening.

We all had to get ready in other people's rooms and we

did not get our room until 10:30-11:00 that night.

So all three of us checked into our rooms.

So we checked in after the event was over with, and there was a

guy sitting there with an old school book with everything

printed out and names and he was calling the home office to

run credit cards and everything.

And the guy who was checking us in actually

had a smile on his face.

And I said to him, I go, " I'm sure you had a rough day.

How did this compare to other days?"

He goes, "Oh, there's nothing that compares to

what we went through today."

wow.

How about that?

So that was ... How you rely on internet

and all that stuff, so.

Oh, totally.

I was kind of having FOMO about not going until you mentioned

black tie event, then I kind of dry heaved a little and I said,

"Yeah, not a place for me."

Because I'd have to rent something that's

qualified as black tie.

Well, black suits work too.

Wait a second.

I don't have a black suit.

I think the last time I wore this black suit

was to last year's event.

Well, sounds really fancy.

Yeah, yeah.

David, how are you?

Josh, I'm not having my gallbladder removed

tomorrow, so better than you.

Yeah.

So we're rushing in to get an episode in because I don't

know how long I'll be laid up.

They're going to suck one of my organs out of

my stomach tomorrow, so.

Yeah.

You know, Cometeer, I haven't said hello to you in a while.

And this is the Klatch roaster, I think it's a CBC blend.

It's delicious, Josh.

It's a dark roast.

And we have not given him a shout-out in a

while, yet I continue to drink a delicious coffee.

You should.

Yeah.

Thank you.

For Christmas, Santa thought it would

be a good idea to get the kids a karaoke machine.

Specifically, Maggie received said karaoke machine.

You know what Maggie does when she gets a microphone?

Yells?

Yells.

Turns the volume to max and screams into the microphone.

But my son, Zachary, on the other hand, who is

a quiet boy, uses the microphone to antagonize

his brother and sister.

And he sits outside their bedroom door and he starts

talking really quietly and really irritating,

and it's usually probably some sort of poop joke.

My man.

And the volume gets louder and louder and

louder to the point where he's like just going so fast.

And especially his brother just loses his mind at him and

... That was so me as a child.

And Zach and I, we're starting our

harmonica band soon, right?

So Alex is starting to take guitar

lessons, this Thursday is his first guitar lesson, and

Zach's mad that they won't give him harmonica lessons.

Oh, poor Zachy.

Josh, we had some ... I mean, I can't even count the

amount of DMs and responses we had to episode 29.

It was ... If you remember, it was IRA contributions,

401ks and things of the sort.

So I was chatting with Erin over coffee one day, like we

do, and she suggested that we dive deep into 401ks.

401ks.

Ba-bum.

Boom.

Does that sound pretty good?

I think 401k talk will be a fun one.

I agree.

So Dave, do you know what ... Like when they

say 401k, where'd they get ... What does that name mean?

Where does it come from?

Any idea?

I figured it'd be maybe like the area

code of some congressman that came up with the name.

That's actually a legitimate guess.

But it is the subsection of the Internal Revenue Code

where they talk about the tax rules associated with

... Alex: Hashtag tax nerd.

These.

So they said, "Let's just call them 401ks."

Because that's what the tax code is called, so.

Not creative at all, but effective.

No, not at all.

So 401ks are what we refer to as employer

sponsored retirement plans.

So you can't put money into your 401K unless

your employer says you can put money into your 401k.

They set all the rules for it.

Now, 401K plans, they are a savings vehicle.

They're designed for people to save for their retirement.

It was an alternative to pension plans, we talked

about how pensions went away in the last episode.

And it's designed to give people freedom and they wanted

to give people tax benefits for saving into their 401ks.

And the only way, like I said, for you personally to put money

into your own 401k, is for your employer to have one set up.

Now most employers have one; big or small, most

employers have a 401k.

Now there's other ways that money can get in there.

Your employer can also put money in on your behalf, you can put

money in ... There's a variety of ways that they can do that.

But that's a good thing.

Like matching.

There can be matching.

So for matching, is an example of ... They'll do a percentage.

So they may do a dollar for dollar match up to 3%.

So for example, if you made $100,000, if you put 3% of your

salary in, which is $3,000, they would match $3,000.

If you put in 5,000, they're only going to match three.

So that's a matching percentage there.

Cool.

And they have all sorts of ways they structure

that; that could be a 50% up to 6%, it could be a 100% up to

12%, there's all sorts of ways that they can structure that.

Now the other thing they have is what they call

profit sharing contributions.

So profit sharing contributions are not matching, they

will put them in whether you put money in or not.

So a profit sharing contribution could be 3%.

So they'll say if you make $100,000, they're

going to put $3,000 in whether you like it or not.

Which ... That's a good problem to have.

And there's other small ... Safe harbor and

different things like that.

But those are the two big ones for the employer.

Now, the employer doesn't want you to put your money

in and leave right away.

They want to reward long-term employees.

So 401K rules ... By the way, the rules are governed

by what they call ERISA.

ERISA is the special Department of Labor

rules that govern 401ks.

So they say what you're allowed to do as an employer and what

you're not allowed to do.

Not to be mistaken with the famous

actress Alyssa Milano.

Totally different thing.

No, this is ERISA.

ERISA.

ERISA.

Yeah.

Mm-hmm.

Sure.

Yeah.

It's like Madonna, one name.

Oh right, yeah.

But these companies don't want you to

just kind of randomly take your money out, so they have

rules that are in there.

And one of the rules is they can put a vesting schedule.

So a vesting schedule is you have to work there so long for

this money to all be yours.

Now, some of it they call vesting immediately, and

so that would be a safe harbor contribution or

something along those lines.

But some could have a 2, 3, 4 year vesting schedule.

So if you leave before that time period

... Dave Schmidt: I'm sorry.

I don't even know what you're laughing at.

I'm thinking of something I want to say

and it's so stupid, but it's going to be funny.

Okay.

Oh god.

You know what it does to my self-esteem when I'm

talking about vesting schedules and you just laugh at me?

I know.

Oh gosh.

Oh.

All right.

It's not going to be nearly as funny now.

You know that, right?

No, I know it won't be.

I don't even know if I'm going to say it now,

but ... Vesting schedules.

Yes.

Go ahead.

So I have one really important thing to

add to vesting schedules.

Vesting only applies to the employer money.

Any money that you put in is 100% invested day one,

they can't keep any of that.

They care what type of vest you wear?

Like sweater vests or

...? Josh Bretl: Is that really

Yeah, yeah.

Was that as funny as you had?

Was that all that giant laugh was a sweater vest?

In my head, it was really funny, but

... Josh Bretl: No,

Oh, that's nice.

They can't ... I don't think clothing

type is a discriminatory allowed by ERISA, one name.

Right.

Not Milano.

Now let's talk about how money goes in.

It has to come out of your paycheck, you can't write

a check for it, it's got to come out of your paycheck

as a payroll deduction.

And it can go either in pre-tax, which means the money is yet to

be taxed, it's a traditional, like we talked about in the

last episode, traditional IRAs, we have traditional you know

traditional Or most 401ks now actually offer Roth options too,

you can put money in post-tax.

Now, you have that choice.

Your employer doesn't have as much choices.

There is a new law that just went through, Secure

Act 2.0, they're trying to ... It's changing some

of that a little bit.

We'll go into more details on this in a future episode.

But most times employer money is always pre-tax.

So whenever employer money comes out, it will always be taxed.

Employee money, you could be traditional or

it could be Roth there.

Now let's talk about how you get money out.

Because the only reason you would put money in

is because someday you want to take money out.

Not because you just want to give your

employer extra money, but

... Josh Bretl: Yeah.

And that's actually a common misconception, and

I'm glad you said that.

You're never giving the employer money.

The employer can't take this money.

The employer can't do anything with this money.

This is money set aside for your behalf, It's not the employer's.

But they do make the rules to when you can get money out.

Is that fair?

Mm-hmm.

Fair.

So now how you get money out is plan dependent,

but there are also IRS rules.

One of the big IRS rules is the 59 and a half rule.

So when you take money out, if you take it out prior to age

59 and a half, you are going to pay a penalty on that money.

Now if it's a traditional distribution, you're going

to take money, it's going to be taxed plus the penalty.

If it's a Roth distribution, the gains will be

taxed plus the penalty.

So potentially more?

No, just the gains, not the whole thing.

Okay.

All right?

Now, there are some exceptions to the rule.

So medical expenses, disability, higher education expenses,

those are some common exceptions that are out there.

So you can pay for ... Well a common one will often be if

you're paying for your kid's school or your own schooling,

you can actually take the money out to a certain dollar amount

and use that for tuition.

So without paying the 10% penalty that's out there.

So Carla being a government employee, 403b

is the equivalent of a 401k?

Yeah, the rules are virtually identical.

There are small nuance-y differences, but it's

pretty much a ... A 403b is generally a 401k for

nonprofits, if you will.

Because she's been taking out 1,500 to

2,000 per month for my private harmonica lessons.

So I mean, we won't be penalized for that, right?

It depends if your private harmonica lessons

are a licensed institution that ... Of higher education.

Yeah, it's at Harvard.

Oh, yeah.

It's at Harvard school of music.

They're renowned harmonica teachers.

And it's really taking that long, huh?

Yeah.

Well I was actually enrolled at Julliard, but I don't

know, it was just a little too intense to manage both.

Did you just say Julliard?

Yeah, I did.

Are you questioning an artsy guy on how to

pronounce and arts school?

Yeah.

It sounded like ... I mean it sounded like a

true south side Chicagoan, like, "Is that Julliard?"

oh gosh.

Julliard.

Not the Jewel's, for our south side friends, but Julliard.

I was wondering where that was coming from.

Cool.

So in other words, I mean, yeah, my harmonica lessons

are probably covered because it's higher education.

Oh God.

So let's talk about what happens to your money once

you get into the 401k.

So you have investment choices.

Once the money goes inside your account and your 401k,

it's going to sit inside something and you're going

to have investment choices.

The choices of investments you have are determined

by the company.

Your employer.

Your employer gets to determine that.

Now, they have to give you a certain number of options,

they have to be able to cover a broad enough spectrum.

Usually you'll see mutual funds, that's the most

common investment under the sun that's inside of 401ks.

Is there a reason for that?

It's an easier diversification tool.

People are familiar with it.

One of the problems with 401k plans is it is allowing the

average Joe to make some pretty serious investment choices.

There was a study done in the early 2000s that talked about

the difference between what the average 401k participant earned

and what " the market" earned.

So going into the early 2000s, and this is coinciding with when

I started my career too, so this was really top of mind, there

was a lot of talk about the historical return to the market;

the market earns 7.5%, the market earns whatever it earns.

And there was complaints coming from 401k participants because

they weren't earning as much.

Now, the market and "professional investors",

they're really good at taking emotion out of the equation

They're not selling when it's low and buying when it's high,

they're making good decisions, but it's not their money.

So when they created these 401k plans and they gave

people the ability to put money away, what they also

did is they gave people the problem where they had to watch

their money go up and down.

So people were making emotional decisions inside of 401k plans.

now mutual funds have always been around for this because

they wanted people to diversify, they wanted people ... It's

an easier way than trying to build your own equity portfolio

or your own bond portfolio or things along those lines.

Now what they've come out with in the last 15 years

or so is these what they call target date funds.

So it's more time-based.

And I'm not a huge fan of them, but for some people they're an

okay thing that's out there.

So typically we have just mutual funds.

Now in recent years, 401ks, a lot of them have been opening up

the world of investment choices.

So they've been saying, "Hey, you can go out and

invest in whatever you want."

Which is good and bad.

It can be very dangerous.

This is real money.

So your money goes up, your money really does go up.

And if that money goes down, that's That hurts.

Deciding where your money goes is something that you

should be looking at on a constant basis, something

an advisor should be looking at a constant basis for you.

It's something that, to be quite honest, over the last

10 years hasn't been that hard because the market still

has been able to trade up, except for the last 12 months.

And I think people are starting to realize that this is

something that you can't just set it and forget it, you really

got to pay attention to it.

And at the same time, try and take emotion out of it

as much as humanly possible.

Let's talk about how we get money out.

All right?

That cool?

Can we do that?

Oh, you're asking me if I want to know how I

can get money out of my 401k?

Yeah.

That's a question I often get asked.

So like yeah, I should probably know the answer to this.

So you've got the money in, you've invested it,

it's grown, and now you want the money out for whatever reason.

So there is always two times you can take money out.

Always.

One is when you leave the company.

When you leave the employer, they're always required to

let you take the money out.

All right?

The other is if you are dead.

Oh.

So then you're not technically personally

taking the money out, but

... Josh Bretl: No, no.

But somebody else is.

Yeah.

Other than that, they can kind of set the rules.

So there's a few rules that quite often they

will allow you to do.

One is 401k loans.

So a loan is while you're still working.

A loan, if you take one, is eligible to

anyone who works there.

And it's exactly what it sounds like, you are loaning money

out of your 401k to yourself.

You're allowed to do a maximum of $50,000, and there's a

rate that you have to pay it back at, and it's usually

tied to the prime rate in some way, shape, or form.

But it is taken out of your paycheck.

Traditionally, you have to pay it back within five years.

So some companies make it shorter, but the longest you

can make it is five years.

And they take it out of your paycheck in equal installments.

So they amortize it like any other loan would be there.

Now, there's good and bad to this.

If you're going to take this loan out to waste the

money, it's not worth it.

But if you need this money, this can be a good spot to go because

of the fact that that interest goes back to you as well.

Oh, it does?

So you get the interest, you get

the repayments, those go back into your account.

so now if I'm paying an interest,

let's say of 8%, actually I'm paying myself that 8%?

Yeah, the 8% does go back to you.

Now, there are loan fees, they charge you to take loans

out sometimes because there's administrative tasks that go

with it, but that's there.

Now you have to realize though, if for some reason you stop

making loan repayments like you get fired or you leave

or you quit for whatever reason, you have 60 days to

pay the whole thing back.

And if you don't pay it back, it's like you took

it out of your 401k, it's like a distribution.

So if you're under 59 and a half, you have to worry about

the 10% penalty and the tax.

And if you're over 59 and a half, you still have the

tax that comes due on it.

So would it make sense, would anybody ever take

a loan out while also still contributing to their 401k?

Yeah.

You can do both?

You can do both.

It does make a lot of sense.

The loan is only there if there's a need for you

to take that money out.

If you're going to buy a new car and that car is $30,000

and you can pay the bank 7% or you can pay yourself 7%,

I'd rather pay myself 7%.

So

... Dave Schmidt: Interesting.

Okay.

Now, if it's ... You're going to waste it on

something, it's not worth it, that doesn't make any sense.

Or you have credit card debt you want to pay off and consolidate,

it's not a bad way to do that.

Okay.

But let's talk about in-service distributions.

We see this a lot in our office.

And this is people who are getting ready for retirement.

And in-service distributions, in-service just means you're

still working and distributions are ways to take money out.

Now this is ... You can do anything you want with this.

What we generally see in our office is they will take

an in-service distribution to roll it to an IRA.

And your company has to allow in-service distributions,

and you have to be older than 59 and a half to do it.

To do it.

But if your company allows it, and most

do, you can take the money out.

And when you roll it to an IRA, then you have complete control.

You can control what your investment choices are, what

your Roth conversions are, you have complete control.

Unlike in the 401k, where you do have Your hands are

tied to what the company says you're allowed to do.

So these in-service distributions can be really

valuable for people who are getting ready to retire.

We use them a lot as people ... Like I said, as

people start coming on board with us and they still have

another year or two of working.

It's a way to jumpstart and get their planning going

that's necessary for them, so.

And you can take like chunks out, right?

You don't have to ... It's not an all or nothing

... Josh Bretl: Correct.

Okay.

Correct.

We'll sit down and we can say, "Hey, let's leave

this much in your 401k.

We'll move this much to your IRA with in-service distributions."

And then when they retire, then we'll take the final

distribution, and roll the rest of that to an IRA.

And when you go from a 401k to an IRA, that

is a tax-free transfer.

So it is a relatively easy thing to do.

Hmm.

Okay.

And limits on how often you can do it or how

many times you can do it?

That's set by the company.

It's one of those rules that the company is allowed to set.

the US government has a limit that you're

allowed to do that once.

Once?

Just once.

Really?

Mm-hmm.

Oh, okay.

But certain companies will allow you to do

it over and over and over again.

401ks can be quite ... Not quite, 401ks are the

single biggest savings tool that Americans have.

Most people use them, very few people know how to do it

effectively and they let a lot of emotion come into play.

And they also think they don't have a choice of what they can

or can't be doing with it as they get closer to retirement.

From an employer perspective, Josh, other

than being a great benefit to employees to offer a 401k

like matching plan, what other benefit to an employer

are there to offer 401ks?

And they're not required to do it by law, but what

are some other perks for

...? Josh Bretl: For bigger

about employee benefits.

Is that what it is?

It's all trying to make employees happy.

For smaller employers, there's some tax things that they can

do and some things that may benefit the owners as well.

But again, the ERISA governs that and wants to make sure

that the benefit is equal to everybody, not just to the high

income earners or to the owners.

But for bigger plans, it's all about employee benefits.

Right on.

So during my research for this episode, Josh,

I came across something.

Have you ever heard of the 401zzz?

No.

You haven't?

No, is that a tax code?

No.

The ZZZ stands for snooze fest, because you've been talking

about 401ks for way too long.

Oh, man.

Yeah.

What?

What?

Okay.

Hey Mr.

Josh, let's take a break.

You've been talking for so long and my ears are sore.

Let's not make them snore, listening shouldn't be a chore.

So let's get to know Josh and Dave, and

watch our ratings soar.

Cackaw!

I didn't even have to ask you.

So I am awfully proud of myself for coming up with the 401zzz,

because I thought it was clever.

I didn't get the guffaws that I thought I would from it, but

I figured, hey, you know what?

I am so well informed on 401ks.

It's now time to pick a card.

So let's pick a card, Dave.

Let's do it.

Let's pick a card.

Mm-hmm.

All right.

This one

... Dave Schmidt: Wait, is Alyssa

No?

No, no.

Oh, okay.

I'm not going to long and ramble the

entry to this card, I'm just going to ask it to you.

If you could make one of your hobbies into a profession,

which one would it be?

Ooh, I've been talking a lot

about harmonica playing.

I don't think I'm quite at that point yet.

There's not many harmonica players in the

world that have actually made any money off of it.

Oh, in the show notes I'll post

... Josh Bretl: I mean

Yeah.

I'll post some links to some of my favorite

modern harmonica-ists.

Oh, I'm sure our audience will be clicking

on those like crazy.

Yeah, of course.

All right, Josh.

So the question is, if I could turn any of

my hobbies into a paid profession, what would it be?

Mm-hmm.

I'd probably take my love and mastery

of video games and make it into a profession.

But not just video games, I'm talking about like

80s and 90s arcades.

Like Rampage, I could set all sorts of world records

for Rampage and I bet you ... I'm on to something.

People would pay to watch me play Rampage.

Josh, I quit.

I'm going to be a professional Rampage-ist.

Thank you for the idea.

We grew up in the 80s and 90s and we had video

games, but the idea of making money off of them is so absurd.

And the fact that there are now legitimate video game

athletes out there ... You used to call yourself a video

game athlete, we used to make fun of you all the time.

That's it.

Like you'd sit down and you play John

Madden Football and be like, "We're video game athletes."

And we'd be like, "Good god, go out and shoot a hoop."

yeah.

These kids are making millions of dollars by just

a simple YouTube channel.

Yeah, it's crazy.

Absolutely crazy.

Ah, I'm so jealous.

My hobby, it would actually be reliving

your childhood dream.

I'd want to be a chef.

Yeah?

Oh yeah.

Oh.

Oh, I love cooking and making people happy.

Maybe ... Maybe like a private chef, like in people's homes.

I want to see them smile when they eat.

Yeah, that's cool.

I still think you and Scott Smith ... Scott, I love you man.

I think you two, you could make a killer restaurant together.

Don't tempt Scott.

Scott wants to do that and

... Dave Schmidt: Does he still

Is that still his jam?

No, now he wants to do like a specialty coffee shop.

And he wants to have a couple really special baked items.

Like he wants to be known for coffee and the cinnamon

rolls, or something like that.

So, yeah.

Oh, cool.

Josh, I would financially support your hobby of cooking.

The problem is I think I'd financially

support it too, so it's not really a good idea.

Yeah, that's so true.

I was sitting here drinking my Cometeer and

... Dave relates to retirees.

You know how the

... Dave Schmidt: Yeah.

Oh, I talked over the "yeah" You'd figure 30 some

episodes in I'd stop doing that.

Do you know the get to know Josh and Dave, you sometimes

struggle to come up with an answer because you're

trying to think it through?

And you get a little nervous as I ask it?

Yeah.

I get nervous every single time when

you're about to open your mouth for this section.

I am going to say you have it much worse than

I, because when you're reading a card ... I mean, yeah, I

could get creative with it, but there's not much I could say.

However, with this segment, anything goes, man.

So let's hear it.

What kind of relation do you have to 401ks

and retirees, David?

I think it's fair to say every episode my

Dave relates to retirees is a perfect one-to-one correlation

to how a retiree feels about a certain topic, right?

In this case, I mean

... Josh Bretl: Perfect

Perfect one-to-one correlation.

You were teaching me earlier about what happens to your

money inside of a 401k.

And essentially what I gathered from that was employees, we

have options as to how to invest that money, right?

But we're not given too many options.

We're given three to a dozen different options, right?

Mm-hmm.

Yeah.

Well, retirees, soon to be retirees, I get it.

We're on the same wavelength.

When Josh, my buddy over here, takes me to a new restaurant

or a new bar, he knows that I get overwhelmed with new menus.

You're right, you do.

I do.

And Josh, I would say you have mastered and memorized

the menu of every local eatery in this area, correct?

Yeah.

Yeah.

So what I'm saying is when I sit down with Josh, he'll

be like, "David, either get option A, D or F."

And he's like, "Those are only three things you'll

like, choose one of them."

I'm like, "Oh, I have a choice, but not too much of a choice."

Just like you, dear friends, have a choice with your

401k investment, but not too much of a choice.

Has there never been a more perfect one-to-one match?

Take it away, my man.

Dave?

Yeah?

I appreciate that one.

Thank you.

I actually think you sent me ... Can I

see your paper real quick?

Sure.

Which one?

My notes?

The top one.

The top one there.

And I noticed Dave has notes here today, I've never really

noticed his notes before.

And I looked over at the top and I was like,

"What does that mean?

DR2R?"

Oh, you've abbreviated Dave relates to retirees.

Yes, I have.

DR2R.

And with that, full house me, baby.

So I love helping people with their retirement.

I love to see them smile and you can see almost the

sense of relief and the sense of them feeling really

good after they come out of a good meeting with us.

You also heard in the get to know Josh and Dave section,

of my desire to cook for people and make a living.

Well your Dave relates to retirees kind of took

that two and combined it.

When you go to a restaurant, they give you a menu and

kind of when you ask the waiter, sometimes you'll say,

"Hey, what do you recommend?

What's best?"

But the waiter doesn't know you.

The waiter doesn't understand you.

And so they may recommend something, they may

say, "Hey, the scallops here are phenomenal."

But you're like, "I hate scallops."

So they don't really know you and how to do that.

Dave, you're right.

When you and I go out to eat, I know you so well that I am

going to recommend something that I think you will enjoy.

And I would say that sometimes I am like your advisor there.

I am like the one who's guiding you as to what you

would like and not like.

Now, ultimately it's your decision.

You may choose to eat the scallops anyways, but I

know that scallops make your tummy feel funny

and you don't like them.

Now, I think that's also what we do for clients.

They understand that they have lots of choices out

there and anyone could help them nail it down, but what

a good advisor will do for a retiree especially is get to

know that retiree so well so that those recommendations

are geared just for them.

And you're not eating scallops.

Now, I love scallops.

So I mean if you love scallops too, that's great.

But I think, Dave, you related to retirees better than you

have in any episode to date.

That makes me happy to hear.

Now, for our audience of one, I don't know about you, Erin, I

have major goosebumps right now.

That was one of the most eloquent, most beautifully

spoken full house moments to date, in episode 30.

That's good, because I feel like we've

rambled a snot out of this show.

We tend to ramble a lot.

That's why we have the edit tool.

So what we have not been really consistent with is

asking our listeners, what to do at the end of the episode,

like I have two things.

Can I share?

Please.

Sure.

The first thing is I would recommend go watch some

reruns of the original Charmed starring Alyssa Milano and

just see how it relates to ERISA, whoever ERISA is, that

Josh keeps talking about.

Second, I would ... Look, I would love for you, dear

listener, to refer on of your friends to pod.link/ref.

We mentioned this last episode

... Josh Bretl: Pod.link/ref?

Mm-hmm.

We don't control this webpage, but it is a really nice kind

of one pager that is curated by some AI robot thingy, but it

gives a great overview of our show and all of our episodes.

And just send them there, pod.link/ref.

You can also send an FSRwealth.com/podcast.

Same thing.

But send one of your friends there.

And hopefully they can get the enjoyment

out of the Retirement Equals Freedom Podcast

that you do, dear listener.

Hey, is Alex allowed to listen to us yet?

Nope, not yet.

Oh, poor Al.

Give him some time.

He'll be back in it.

Yeah.

Well, Al, let bygones be bye-gones.

Bye.

Oh, gallbladders.

Or ... Dave?

Dave?

Yeah?

Like my gallbladder, let's sign off.

Oh.

Oh my god.

Josh, I'm so proud of you.

Good one.

That's the winner, winner, chicken dinner.