Don and Tom explore the evolution, promise, and pitfalls of Exchange-Traded Funds (ETFs). While ETFs have become the dominant investment vehicle, boasting $8 trillion in assets and more than 4,000 choices, the duo cautions against the “novelty trap” that lures investors into trendy, high-cost, low-diversification funds. They advocate sticking with time-tested providers like Vanguard, Schwab, and Avantis, and urge listeners to focus on strategy over hype. The episode also covers listener questions on Facet Wealth’s alternative investments and Roth IRA income limits, ending with a light jab at Portland’s real estate collapse and Don’s growing jet lag.

0:04 Opening banter and the rise of ETFs as mutual fund successors

1:28 ETF history from SPY to the $8 trillion juggernaut

2:21 Why ETFs caught on: low cost, tax efficiency, index focus

3:45 When Wall Street noticed: strategic beta and rule-based funds emerge

4:59 The novelty problem: gimmicky single-stock and crypto ETFs

6:57 How to filter the 4,000 ETFs to a trustworthy handful

7:34 Which fund families to consider—and which to avoid

8:58 Active vs. passive: the murky middle and the “passively active” dilemma

10:01 Conflicts of interest in ETF endorsements and advertising bias

11:19 ETF investing principles: keep it simple, diversified, and strategic

12:09 Why the industry lumps Dimensional and Avantis with active managers

14:09 Brief detour into Austin, Silicon Valley, and Portland real estate

15:22 Final ETF takeaway: old, boring, and proven beats shiny and new

17:01 Listener Q1: Is Facet Wealth’s alternative income strategy a red flag?

22:01 Listener Q2: Roth IRA income limits, backdoor Roths, and best next moves

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