Navigating a High Rate Market: Buying a Home, Preparing for a Recession and Where to Put Cash with Ben Carlson

#117: Author and financial advisor Ben Carlson joins Chris to share insights on the current state of the market. They discuss the impact of aggressive Fed rate hikes and the unintended consequences, including the debt ceiling and regional bank collapses. Ben also shares his expertise on where to park cash, comparing I bonds, high-yield savings, short-term Treasury ETFs. Finally they offer strategies for buying a home and lowering mortgage payments in this high-rate environment.

Ben Carlson (@awealthofcs) is a prominent figure in the financial world, recognized for his popular blog A Wealth of Common Sense that covers a wide range of financial subjects. He is an accomplished author of four books and the Director of Institutional Asset Management at Ritholtz Wealth Management, where he helps individuals and institutions navigate the complexities of investing and personal finance. He's also the host of one of my favorite podcast's Animal Spirits.

Link to Full Show Notes: https://allthehacks.com/market-update-ben-carlson

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Resources Mentioned

Ben Carlson: A Wealth of Common Sense | Animal Spirits Podcast | Twitter

Ben’s Books:

A Wealth of Common Sense: Why Simplicity Trumps Complexity in Any Investment Plan

Everything You Need to Know About Saving For Retirement

Don’t Fall For It: A Short History of Financial Scams

Organizational Alpha: How to Add Value in Institutional Asset Management

Finance Apps

Quartr

YCharts

Yahoo Finance

Koyfin

Portfolio Visualizer

ATH #42: Beating Inflation, Alternative Assets, and Simplifying Your Finances

ATH #91: Die With Zero: Net Fulfillment Over Net Worth

Historical Fed Funds Rates

JP Morgan Study: The Agony & the Ecstasy 3.0

Treasury Direct: I bonds

BiggerPockets Real Estate Podcast

Tesla Auto Loan Spreadsheet

Full Show Notes

(02:26) The Current State of the Markets

(03:41) Reason Behind Aggressive (Unprecedented) Fed Rate Hikes

(05:23) Unintended Consequences: Debt Ceiling and Regional Bank Collapses

(06:54) Chris’s Experience with SVB

(10:03) Next Steps for Average Investors

(11:13) Ben’s Advice to Clients

(14:10) Preparing Personal Finances for Recession

(15:26) The Tech Recession

(21:46) Classifications of Tech Companies

(24:32) The Role of Cash in an Investment Portfolio

(26:33) What Happens When the Rates Drop?

(28:57) The Duration of Current Rates

(30:13) The Use of I Bonds

(31:34) Investing in High Yield Savings vs. Short Term ETFs

(33:47) The Need for an Emergency Fund

(36:13) Exploring Future Employment Opportunities

(37:19) Buying a Home in a High Rate Environment

(40:53) Strategies to Lower Mortgage Payments

(49:11) Maximizing Net Fulfillment

(50:48) Optimizing the Home Buying Experience

(52:53) Auto Loans

(54:12) Credit Unions

(55:00) Student Loans

(55:48) Ways to Estimate Risk and Potential Upside

(57:40) Ben’s Recommendations for Financial Services

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