it's great to have you here on the clark howard show you know our mission is to serve you with advice and information that empowers you to make better financial decisions in your life and it's friday which means it's krista's favorite day it sure is not just because it's the weekend But you get to share Clark Stink's posts with people. Time for me to go back to school in the middle of summer and learn how I messed up on this podcasting YouTube show serving you. On a more serious note, I mean, wow, Americans across income levels, except for the very, very rarefied air of the elites, are worried about their finances, their future, Social Security. I'm going to address that later on today's podcast. But without further ado, it is time to hear how I am stinking it up. I should have never encouraged you to speak. You must think I'm pretty stupid. You should be ashamed of yourself. Well, maybe I'm wrong. Maybe I'm wrong. Maybe you're right, pal. Oh, I'm sorry. I'm stuck on you saying that I enjoy this because I don't like reading the criticisms of you. So I actually do enjoy it. I know you do. I love hearing where I missed the mark, where I didn't explain something well. Or also there are times where you may not understand what I really... meant to say or said. Yeah. And sometimes people just offer extra info. Yeah, that's true. All right. Eric in Ohio wrote into Clark stinks with this one. Clark, I'd say you're freshly showered, but maybe forgot the deodorant. When the 19 year old wrote in about preparing for a house for he and his soon to be fiance, it might've been good to suggest a good premarital conversation about money priorities, whether it's a premarital counseling or just a good open discussion. it would be great to make sure they're on the same page. He's a big-time saver, but what's her approach to money? It's something that can create conflict for newlyweds, so head it off. I love that. And premarital counseling is so important, so valuable, because everybody does come in with different money values, and they're usually quiet about them, private about them. And then you're going into a union and you can really break trust in a relationship or a marriage when you've got different attitudes about money and then you got your secrets. And those secrets eventually come out with bad effect. So having those conversations up front, great suggestion. Bethany in Colorado says, Sometimes damage is below the deductible. No actual damage is found during the inspection or the customer withdraws it. Crucially, if a homeowner has flood damage, the National Flood Insurance Program requires a formal denial letter from a primary property carrier before the NFIP will even process the real claim. Your coverage ignored how heavily regulated the market is. We cannot afford to have insurers paying out invalid claims willy-nilly. Insurance pools risk, meaning those unmerited costs, would ultimately be borne by all of us through sky-high premiums, reduced coverage options, or worse, carrier insolvencies. Accurate claim assessment isn't bad faith. It's what keeps the entire insurance market solvent and available for everyone. Bethany, thank you. And it's always good to hear from someone who has a totally different perspective. So one of the things that was clear in the data that the Wall Street Journal cited is that the number of zero claims paid, zero dollar claims paid, is up significantly. Insurers have become tougher and the policies are more limiting generally in what they do cover. And then, of course, with the higher deductibles. As far as insurers being regulated by the states, in a number of states, there's been what's known as regulatory capture, where the regulators themselves are really under the control of the insurers rather than being there for the policyholders. That's not universal, but in a lot of states, turning to the insurance department is looking for the fox in the henhouse. It's not really there to serve the consumer because in many states, most of the money that goes to the campaigns for elected insurance commissioners comes from the insurance industry itself. One thing that I will say, for $0 claims to be treated in insurance industry databases as a claim of punishment against the insured really bothers me. And only a small number of states have dictated that $0 claims not be reported. I mean, think about that's the worst of all possible worlds for an insured, Bethany. when an insurer pays nothing and then it still harms the policyholder with a claim posted to their record, which leads to higher premiums and a more difficult time when you want to shop your insurance to switch to someone else. Okay. Rich in Ohio says, I've dutifully followed Clark's advice for years, but your advice recently put me into an awkward position. on a recent camp out i purchased an item for another adult leader who wanted to reimburse me i offered venmo and cash app she asked why not zell i invoked your name as an anti-zell zealot she wasn't aware of you and had less interest in your opinions it turns out that she wrote the internal zell code for one of your four favorite monster mega banks i didn't know how to respond how would clark have handled this awkward situation i definitely failed i think she's okay. I built a good enough will with this person where she will forgive me. Jokes aside, Clark's full on stinkiness is on display for failing to offer meaningful alternatives to payment apps and checks. I'm the treasurer for a scout troop. I collect payments through our square account. When I calculate the cost for an event, I inflate the cost to cover the square fees for members who pay online. I also offer an option to collect payment from them via checks to cover the event cost only. I take the checks in person, deposit through a banking app, and then shred the checks. Clark hates the security around Zelle and the risks created by checks. We're all in this together. What is your recommended approach for collecting member payments for a nonprofit that avoids fees and maintains financial security? And then I'm going to read this too. I know it's long, but a PS. Other Clark info for Krista's amusement. I think for everyone's amusement. I first became aware of Clark when I was living in Dayton, Ohio. Clark threw out the first pitch at a single A Dayton Dragons game somewhere between 2000 and 2001. My coworker freaked out at Clark's appearance. I started listening to Clark after that event. I bought not one, but two Kodak printers because of Clark's recommendation. When the first one failed, I thought it was bad luck for me. But when I purchased a second unit and it failed, it was on Clark. I was so frustrated, I dropped the second Kodak printer out of a second floor window for the therapeutic event. I'll let the bad printer recommendations go as following Clark's recommendations over 25 years more than covered the cost of two faulty printers. Okay, there is so much here to unpack. So let's take them in reverse order. Yeah, the Kodak printers. You hate me for the Kodak printer I mean no I didn like the Epson too But the EcoTanks But yeah the Kodaks were You don like the EcoTanks No, I always have issues with the software, with those things. Huh, okay. But, yeah. Well, I mean, now what I recommend is people go back to a simple black ink laser printer, and the brother printers tend to be the cheapest per page. and forget these color ink printers because they are trouble prone. So the Kodak ones, that's all on me. All I was looking at is the cost per page and the lack of reliability. Well, okay. So I, over the course of my career, had the privilege of throwing out first pitches at various minor league parks and major league parks. the best first pitch I ever threw out in my life was at a Dayton Dragons game. And that's because the morning show host at the radio station I was on at Dayton was a real jock. You remember Larry Hanskin? And he, before the game, said, we're going to go throw the ball. And took me out and taught me at least for that. It was able to stay in my brain for long enough to throw the first pitch. I threw a great first pitch. Nice. Last time I threw one was at a major league ballpark. And I got roundly booed by the crowd. It was such a bad pitch. Oh, man, that was pitiful. Now let's move to the important thing, Zelle, because I'm definitely not. Well, the real question is how do nonprofits collect money? Because we've had this from other people too who are like Girl Scout leaders. There is no way today that exists for people to move money for organizations that has no downsides. There's just not one. The reason I call Zelle Big Bad Zelle is the banks have this embedded in your checking account. so the risks are so deeply embedded that there's greater hazard for you with Zelle than there is with Cash App or Venmo in terms of if somebody gets access to your checking account, the money can be moved one way, no way to reclaim it. Now, Zelle had a big profile on them in Congress several years ago and agreed that they were going to implement consumer reforms and then later got amnesia about that. So the problem is the same with fraud, with Cash App, Venmo, Zelle, any of these payment platforms. Federal law never recognized the risks that exist with them for your money to take a one-way trip because of fraudsters gaining access. So the only reason Zelle is big bad Zelle is they promised they were going to offer consumer protections. Didn't. And the fact that your checking account is embedded in it, which it's not with Cash App or Venmo. So I don't have, I just don't have a good answer to this. We use in our household a Venmo account that we have a separate checking account for at a credit union. And we go deposit money in it when we need to do so. My wife had to do so earlier this week to deposit in it because we had run through the money we had in it and needed to deposit more. So it's a hassle, extra effort, but it's how you take somebody that doesn't have adequate consumer protections and limit the risk. Frank in Colorado says, Clark, you stink so bad you make month old trash smell like roses. That's pretty stinky. You missed an important thing in your reply to a question about an in-network clinic legally billing you for out-of-network providers. A lot of people have health insurance through companies that are self-insured. If you have a problem with billing, reach out to your company's benefits person. They have a lot of pull and can easily override denied claims or out-of-network charges because they're actually paying the bill. Frank, thank you for that suggestion. Depends on the size of the company, how responsive they'll be internally in HR. But that is a great idea. is I don't know that we've mentioned recently that a lot of what you think are health insurance plans are actually just health reimbursement plans subsidized, paid for, where the claims are essentially paid by your employer. When that's the way it works, you can't go to a state insurance department and seek any help with an insurer. So it has to come from your own employer, just like you said, Frank. John in Minnesota says Clark stinks like recently shucked oyster shells left too long baking in the hot Carolina sun. Not really. I've been a listener since starting my career. I remember sometimes hearing Clark qualify incomes with savings like a lot, a lot of money. And I had no idea what that meant. I was just hoping to someday I would find out. Fast forward nearly three decades. Thanks to good fortune, hard work and the wisdom gleaned from your show. My wife and I have options for retirement in our early 60s with very little concern about our financial future. My Clark Stinks request is this. Please remember that many of your longtime listeners have moved from one side of the financial spectrum to the other. When you say things like people making a lot more money than average or highly compensated employees or ultra, ultra high income earners, it would help if you put actual numbers around these statements. The habits that help people build wealth are often the same habits they need to maintain after they've built it. We still want to know what Clark quantitatively thinks and not just using colorful adjectives. And yes, I still remember when you encouraged your listeners to unplug electronics before leaving town because they were quietly trickling electricity and increasing your bills. Thanks for everything you and your amazing team have provided over the years. You've touched millions of lives, including my wife's and lucky daughter's. daughters. And P.S. I have your Costco price guide stored on my phone and knowing what 97 cents means has saved me hundreds. Oh, do I love the 97s. I was in Costco two weeks ago. It's been two whole weeks since I've been to Costco. Wow. What? Yeah, I know. You've been in jail. What happened? We We weren't going to talk about that. And there were so many 97s. They're in transition with clothing. You know, because now, even though we're in the heart of summer, the fall fashions are coming in. So the things they got to get rid of are marked down. I mean, just item after item marked at 97. So if it ends in 97 cents, it's being sold below Costco's cost. That's a real deal. Okay, so there's two parts to this. One, what is somebody who's earning ultra, ultra money? And I would say that the number that I'm thinking of when I talk about when you do a Roth 401k versus traditional, that sort of thing, we're talking about the range of $400,000 to $500,000 a year and above. That's big-time money. and not that many people earning that kind of money. That would be highly compensated. That would be ultra high income earners. But the big thing in what happened in your life and in many other people's lives, it's not as much what you make, it's what you don't spend that counts. A lot of people make big money and somehow manage to blow that money in lifestyle creep. So wherever you are on the income ladder, once you're at a point that you've covered the basics, what really matters is are you living on less than what you make? Are you living a lifestyle that the money you're able to save will eventually allow you financial independence, in your case, in your early 60s? That where you want to be is that your mentality is I always living below my means what I make Patrick in Nevada says 10 large non fish were poured into a polo and khakis walked 10 miles in the summer sun to the nearest Costco, and the food court attendant said, here's your hot dog, Mr. Howard. Clark said Discover had zero acceptance outside the U.S., which is not true. Discover owns the Diners Club Network, which is accepted in multiple countries, particularly in Europe and Latin America. Also, Discover has reciprocity with China's union pay network. While having two cards in different networks is great advice, don't underestimate Discover's acceptance. So, Patrick, I never had heard that Discover's parent company, Capital One, owned also the Diners Club network. That for people that are credit card geeks is the card network where the card numbers start with a six. and so that is new news for me and wow I never knew that so thank you remember forever ago that was the card I used to use I do I had a diners club card and it had been really the wonderful card to have for travel and then things changed and it wasn't so great and it rode off into the sunset. Yep, but new great ones came in. That's right. That's the thing. Change is inevitable of all different kinds. And you can embrace change or hide from it. I probably embrace it too much. That would be another Clark Stinks. No way. Anyway, I'm saying I stink myself. Thank you so much for your posts on Clark Stinks. I appreciate it very much. I learned so much from you when you post your Clark Stinks. Coming up ahead, something else that stinks? Wow, people are really anxious right now about the future. And it seems like those folks in Washington aren't paying any attention to what's got us angsty. I want to talk about that straight ahead. Okay, latest estimate. We got less than six years till Social Security is insolvent. And we've only known that Social Security was running short of funds for the last 15 years. And the politicians of both parties have just totally ignored it. Because they don't want to, politicians at base are salespeople. And you don't want to tell your customer that there's bad news. So instead, you spend your time talking about things that maybe inflame people, rile them up. But dealing with real problems? No. Sorry. That was unusually negative for me. But I don't like this. I don't like this at all, that we've got 70 million Americans that depend on Social Security for at least part of how they live in retirement. They're receiving it right now. And you got roughly a third that their only financial support every month is that Social Security check. So what's it going to mean that less than six years from now, Social Security is out of money? Well, the sooner Congress does something, the less difficult it is. And it would have been something we wouldn't have even noticed if we'd had some people who actually cared in the House and the Senate and fixed this 15 years ago. And it's your individual congressman and your two senators who are looking the other way and not solving this. The reality is when this happens in the next five plus years, if nothing is done, your Social Security check would be cut about 20%, depending on actuarial 22, 23, somewhere in there. What's it going to take to fix it? Okay, it's going to take two things potentially because the problem's gone on so long that it means that Social Security taxes will have to go up and that still won't be enough to solve the problem. Benefits for people who earn more money will be reduced. That I will get, because I get the maximum you can get under Social Security, I'll probably get a haircut. So I'll be fine as most people who are earning the max under Social Security got there because they made more money, they have more resources. But the longer this goes on, the more the taxes have to go up and the more people at the higher end receiving Social Security are going to have to have haircuts. And so I just wish, with a lot of things we have going on in the country, the budget deficit, which is ridiculous, the outstanding debt of the country, obscene, $115,000 per person, I think, in the United States, and indebtedness by the country. We got to deal with this, especially because Americans in a recent survey say that they're pessimistic about the future, even if they're high income earners, that across income levels, over 80% of people believe their kids are going to have a worse future than we've had. I think it's because of the fact that we have non-functional government right now at the federal level. A lot of states still running things really well, but we're not addressing problems. And the American people feel it. A third of Americans say they're significantly worse off than they used to be. That's not good. I mean, we've got so much good stuff here. and so much economic dynamism in the U.S. We're a very dynamic economy. We have opportunity for people to be entrepreneurs here that's unrivaled in the world and create wealth and opportunity. But our political system is coming up short. And if you can't take care of simple things, like a clear math problem with Social Security, The reality is there are times you have to deliver bad news to solve a problem, and we need to do it. I want to make a point, though, to people in their 20s and 30s who tell pollsters overwhelmingly that Social Security is not going to exist for you when you would become age eligible. And I don't believe that. By the way, that's the other thing, is the age of full Social Security will probably be raised because lifespans have gotten longer. That would be the third part of fixing the math problem. But as far as Social Security ceasing to exist, it's the most popular of all federal programs. There is not another federal program that is popular as Social Security. And so it will continue to exist. it's just getting to where it's healthy again is going to be more painful than it should have been. Okay, let's go to some questions. I'm sure hopefully there won't be a ton of Clark Stinks coming in. That's okay. I mean, that's just a fact. Yeah. That people see everything through a political prison. I know. And we'll hear from the people who only see through their political lens. But this is a math problem. Okay. R in California sent this in. I have multifamily properties in California and received monthly rents for my tenants via Zelle. I heard Clark's negative comments about Zelle, and I'm wondering what other option is out there for tenants to pay their rent electronically at no cost to them. Regular bank transfers also have some fees. I won mind absorbing a low fee as the cost of doing business Thanks for advising me on some wise and secure options Well thank you very much R And so the funny thing about Zelle is for you receiving rents that way, there's not the risk there is for your tenants paying that way. So if that's the platform they're comfortable paying on, then you're receiving the rents, then you keep doing that. But I would say that given a choice, you using Venmo or Cash App is marginally safer. The real problem, gosh, is like the theme of what I just talked about, is that there aren't legal guardrails in place to protect the users of the payment apps. And that is something that requires action by those very politicians I was just talking about. So if it's working fine for you to receive those rents through Zelle and your tenants are comfortable, the risk is always more on the sender of money using a payment app than it is on the recipient. Aaron in North Carolina says, I want to take a moment to thank you for all you've done for me over the years. I'm probably one of your longest time listeners. I remember listening to your program while I was in graduate school in Tennessee. I've been following your work ever since, and I've learned a tremendous amount from you over the years. Recently, a question came up that I hope you might address. My insurance company is now offering me access to my credit score, but they refer to it as a FICO score 10T. They describe it as a newer credit scoring model, and I'm curious about what it really means. Could you explain the good, bad, and the ugly of FICO 10T? Is it truly an improvement over previous scoring models, or is it simply the latest trend in credit scoring? How might it affect consumers, borrowing decisions, and financial planning? So FICO 10T is a competitive response to Equifax, TransUnion, and Experian have their own scoring model called Vantage that they're trying to gain market share with. So 10T is a new, let's call it the Mac Daddy credit scoring model that uses deeper analysis to come up with a score on you. And the FICO pitch to lenders is that it is more predictive of who might go delinquent or default on a loan than prior FICO scoring models. but it's unproven as of yet that 10T will be better. But it brings the point up that we have so many different credit scores. We have the various ones that you might get from somebody reporting to you who uses Vantage scores. But with FICO, there are so many different kinds of scores. There are specialized ones for mortgages, car loans, credit cards, scoring models that consumers see, like the 10T or 9 or 8 or blah, blah, blah. So you want the trend to be your friend. You think of it more like horseshoes that close is what you're looking for. That's why I tell people using the credit scores available from Credit Karma are useful just to give you a sense of trend. And you see, hey, I'm handling it pretty well. Because all the scoring models start with certain basics. One, that you pay every bill every month on time. A single late payment will harm you. Multiple late payments will destroy your credit score. And that's the largest single factor. Second, and these two things account in virtually every scoring model for about two-thirds of what makes up your score. Second is how much of the credit you have you're actually actively using. You want the amount of active use of, let's say, the lines you have on credit cards to be below 30%. Time will tell whether this latest FICO version, 10T, is a more accurate predictor as far as lenders are concerned and would become like a gold standard. Right now, it's too early to know. Nancy in Massachusetts says, I wonder if you know of any insurance policies out there that cover a stay at an Airbnb. I'm aware that the site does sell a policy you can purchase at the time of a reservation, but I've heard that there are lots of complaints about it. I'm most interested in coverage for property damage. Love your show and all the great advice you share. Thank you. And the property damage thing with Airbnb has been an X factor for people staying in Airbnbs for a long, long time. Because you're considered to be guilty till proven innocent as the renter of the property. That's why I want you to, when you first arrive at an Airbnb, to take out your phone and shoot thorough video, room by room. You want to, you know, you've been traveling. You want to just unpack. You want to enjoy it. Before you do any of that, I want you to shoot your video. And then when you get ready to leave, I want you to shoot video again. Because that visual evidence could be very important later when you're cited for damage to a property that you know or reasonably know you didn't cause. All right. Let's go to your insurance thing. Yeah, you can buy the captive stuff from Airbnb. But now, because people in the travel insurance business look for any opportunity to sell policies, there are any of a number of travel insurance policies that cover Airbnb or VRBO rentals or non-branded with the two of them vacation rentals. And if you look on a wide insurance seller site, like I mentioned InsureMyTrip, but there are others as well where you can see different policies. There are quite a number of sellers. You could even do a Google search and you would find a number of companies that sell vacation rental insurance. Some of them only cover the deposit issue where a lot of Airbnbs and VRBOs have very unfriendly policies in terms of refunds and when you can cancel. But others cover beyond that and do cover damage to the property or alleged damage to the property. So you don't have to look at this as being a captive of Airbnb's own platform and own insurance. You can buy the third-party stuff. But again, with an insurance claim, the video that I talked about up front, so very important. And I'm going to end the week on that note. And I hope that you have a wonderful weekend in front of you. and as I've talked about before do I love this time of year on the weekends long daylight, warm weather I get to go out and about and love to get in my 14,000 plus steps a day to try to keep my body working and thank you for being part of what we do here on the show but all weekend long we're here for you at Clark.com and ClarkDeals.com And we got our free newsletters. I'm really proud of our newsletters and our newsletter editor. So look for what we got because it's free but powerful. All you got to do to see what we have available to you to subscribe is Clark.com slash newsletters. And one of the things I love about our newsletters, and it's a requirement, that we not play the dirty games where you subscribe to something and make it tough for you to cancel. if you find you're not getting the experience I promised and you want to dump out we make it as easy to unsubscribe as we make it to subscribe it's all about empowerment through knowledge so you can save more spend less and avoid getting ripped off and we'll be at your service Monday
