006 - A Worthy Place For Your Savings That's NOT A Bank

Looking to invest your savings somewhere that makes more than a measly 0.43%? HYSAs are an option, but they often come with headaches.  

Worthy Bonds pays high interest and makes things easy. They have no fees, penalties, term dates, or minimums. You also have peace of mind with their collateral-backed, first-lien loans. 

With their low cost of entry and daily compounding it's a no brainer. That's why we have our savings and emergency funds invested with them. 

Drop your comments or questions for this episode on one of our posts.  

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Chapters

• 0:00 Intro
• 1:17 Worthy Bonds, What Is It & How It Works
• 4:07 Their Risk Mitigation Strategy
• 7:25 Pro - Low Cost Of Entry
• 8:30 Pro - You Can Withdrawal At Any Time
• 9:23 Pro - Not Penalties or Fees
• 9:55 Pro - Pays More Than Grade A Bonds
• 11:03 Pro or Con - It Takes 4-5 Business Day To Withdrawal
• 11:37 Comparing Worthy To HYSAs
• 13:06 Pro - Less Market Dependent
• 13:54 FDIC Insurance vs Collateral Backed Loans
• 17:34 Pro - First Lien Structured
• 18:40 Pro - Compounds Daily
• 22:12 Pro - You Can Make It Automatic & Passive
• 24:10 Tim's Charities Soap Box
• 28:51 Pro - High Liquidity
• 29:22 Pro - Has A Bigger Impact
• 31:13 Compound Interest pt 2
• 33:06 Con - Not FDIC Insured
• 34:26 Con - Can Only Issue $50 Million Bonds A Year
• 35:12 Con - Has Investment Caps
• 35:36 Con - Only Available In The US
• 35:59 Offer Different Kinds Of Accounts
• 36:51 Alternatives To Worthy

Transcript

Welcome to Roaming Returns, a podcast about generating a passive income through investing, so that you don't have to wait to retirement to live your passions. In today's episode, Tim and Carmela talk about an investment opportunity you might not have heard about, and it's outside the stock market. It's an interesting hybrid between a high interest savings account and bonds. But what's crazy is that it gives you like over 11 times what a traditional savings account pays out. Curious for the details. You'd be crazy not to be strapping

Welcome back. Hello.

Today we're super excited to talk to about where are the bonds, one

of my favorite investment things, I love it.

Alright, so first we're gonna talk about what were the bonds is, we're gonna give you a little bit of the background of that some comments from the CEO. And then we'll go through the pros and cons and then we'll round it out with the types of accounts they offer and why we prefer it or we absolutely love it over a lot of other high interest savings account options. Okay, okay, here we go. Alright, so what is worthy bonds?

Sounds like it's bonds

which is kind of confusing because it's not like your typical bond, where you're in the stock market or you go through I guess some of the

kinda like a treasury bond, but it's treasury bonds have a maturity date and where the bonds down. So it's kinda, they

used to have a maturity date. They used to actually expire every three years and then you'd have to go in and I guess reinvest your money?

Yeah, they used to so they probably named it where they bond when they had those maturity days. Now that they don't have those. I don't know.

It's essentially like I think it's kind of more like a crowdfunding peer to peer type thing but it's for small businesses, which is pretty cool because you get the invest in

what you think, okay, that like, we mentioned this with BDCs and Rei T's and things like that. What does it mean? Well, the small like small businesses are generally under like, I don't know, 50 million, I don't know the exact threshold $50 million. So they can't actually go to banks if they have to minimum a revenue generation. So that's why that's why BDCs were actually created in the 80s. And because like, Big Lots, for example, only, it's only it's a small small cap company that can't go to a regular bank and say we need to borrow $10 million. Regular bank won't lend to them. So they actually had to create a way for small businesses to acquire loans and the way they did it was through making the threshold.

I think they probably did something like that because most people aren't accredited investors where you have to have the million dollar crazy criteria to be that

crude investors aren't worthy is actually only $200,000. You wouldn't be listening to this. This

is actually an opportunity for everybody, as opposed to like an accredited investor only. But the reason

that I like worthy is because they created it as a win win for the people who are getting the loans for their small business. And they created a win for the people who want to give money to a place

to make money in the stock market and actually kind of get back to smaller

whereas the BDCs you actually can't and like you can't invest in a BDC like you can't worthy you can buy a BDCs stock or preferred shares but you can invest like, like, like you can with say, a fundraiser where they where you can actually invest in the company itself.

When the CEO was asked her why she did what she did. She said that she's trying to help improve the financial health, but she wants to do it outside of Wall Street and making this opportunity available to everybody. Not just the 1% which is freaking awesome. Like I love her vision.

So what they do is they then like because there's small businesses can't get Milan's will actually go to a place like Hercules capital HTC, one of my favorite BDC or where they get their money. And but what were they does like really like is they like they pay you a really good percent for fairly and minimal risk. It's not granted, it's not FDIC insured, so it's not 100% RISK FREE, you're not going to recruit your money. It's like, shit goes sideways, but it's the way they have it set up is really neat. Like they actually so what

they do is they basically require you to put up what is it 80%

They don't go more than 75% of the asset like so if you have a set fee of a million dollar company they won't lend you $750,000 To cover like

their assets as collateral. So even if it's not FDIC insured, it still has that level of security. And then what worthy also decided to do is that they actually kind of diversified a little bit. So what they do is they diversify out into they do the asset backed loans for small businesses, and then they'll actually take 40% of their income or their money and they invest in a mix of real estate, US Treasury securities and CDs so that it's they're actually like build it boosting up that that risk factor.

What they do that so like, so if you say you buy one bond $10 like 50% of that is gonna go to the actual company borrowing the money and 50% is going to be in see like a CDs treasuries and real estate. That way that your principal like I think the goal that was that your principal never depreciates even if like the shit goes really sideways.

Yeah, she she I think the CEO was asked What if she can expect to give the same amount of returns like year in year out regardless of what the market is doing? And she sounded pretty freaking competent. So I'm assuming the way that she hasn't invested in and you think about as small businesses are going to have to operate through ups and downs anyway, and we always preach about how the changes in the market fluctuations are based off of emotional investor sentiment, that doesn't necessarily directly reflect what's actually going down. So if you think about it, from a business standpoint, businesses are always gonna have to be growing, building expanding, trying to make money borrow money and the whole thing. This is a really interesting, it's outside the stock market, which is a great opportunity for little investors like us who will have like the millions of dollars that the whales have, and they can do the hedge funds and all that other.

Worthy makes money the exact same way that a normal bank would make money they will borrow the money, borrow quotations, the money from you at 5.5%. And they'll lend it out at say 7%. So so the company is borrowing money or getting a car, they're getting a competitive rate compared to banks that they can't apply for loans from but moorthy makes money by that that interest rate percentage difference. So

we're kind of like a middleman supporting. It's a pretty cool way. If you think about it, it kind of reminds me of like ride sharing with the Uber situation where it'd be kind of like outsource the whole taxi stuff by having the middlemen. Well, I mean, isn't a similar concept for like, cars out there driving Ubers offering the service, but we're actually being the avenue that is allowing it to happen while we're giving back to people who actually want to pay for rides to go here and there and don't want to pay for taxes or public transport. So it's, it's a middleman thing. There's a lot of stuff that's going that route, which is pretty cool. Airbnb is another one that's kind of doing something similar. Alright, so let's get into the pros of worthy. One of the awesomest things normally in the stock market you have to pay. I think the average car price is 100 bucks then into a bond 1000s 1000 for 100. For this you only need 10 bucks to get started which is fan freaking tastic.

Yes, I like it 1000 will get you 100 Which is nice. And the reason that's I like that small entry thing is the same reason that I buy like five and six and $7 stocks you acquire so many more. In this case, quote unquote bonds I mean,

it could be a psychological the higher quantity of bonds, more

I like but I like we'd like the part that I find most appealing about the $10 thing is when it comes time to withdraw you can withdraw in $10 increments as well. So that makes sense. If you don't want to say right now we have 6000 in worthy or whatever we have 5800 If I wanted to take out $800 I could. So I like the smaller breakout and

that's another pro that we have in here. You basically can take out whenever you want on like a normal bond where you have to wait until the term is up or you have to sell it to somebody else.

It's pretty simple to it's like on your dashboard page you literally will just click the redeem bonds and as long as you have to link your bank account up to it to actually start the process anyways. So when you redeem bonds, it'll say transfer the money back to X account and literally took one year it's like one or two clicks and then it's like five days later all your money's back. I've taken

my entire like a $10,000 sale now. Why was painless?

So I like that because like if I were in Sunrise for example and I know you'll streets the same way you can only take out four times a year and you have to be like spot on he's like okay, it's October 1 I have to take out my fundraiser my yields. penalize you

with interest don't pay if they give you there's like a penalty I think they

do penalize you like they don't penalize your principal. They penalize your earnings.

Whereas worthy doesn't have any late fees, no fees in general. No penalties like there are no two

what I mean by penalty is like when I went through my fund rise, I took out 5000 And I earned I think it was 500 some dollars. Well, the 5000 they didn't penalize me for taking out but they actually it was like a 20 Some percent penalty on my earned interest of 500.

So it's the other thing that's really cool. I don't know if you know what the general bonds like yield is right now.

In general, in general, like depends on the grade like a grade in general. Like three to 4%.

So right now, they actually have a special as 6% yield. I think that's only supposed to go through the next

September, October November. So they'll go through January that February, February, I'll go back 5.5%

So if you read anything that said that as a 5% They've actually upset and that's fine. 5.5 AP wise now they're standing normal yield. But what's cool about that is if you're if you have money sitting in a regular savings account, the average savings account according to statistics from August 2023 It's only point four 3% AP Why 5.5 and 6%. If

you recall back in the day, and I said if your money's in the bank, you're losing money that that's that's why

you want to do some fun math. That's literally 1100 80% increase

all maths fun or API. It's not just this, which is

like 11.8 times this just

so the only the only difference between worthy and your regular savings account as you can get your regular savings account and you can withdraw your money today

and write checks out of it. You can transfer it

or the you actually have to have a like a plan have some sort of county I'm gonna need like that $1,000 By like the first scientist to start the process by like 25th or whatever. And

I think that's a good trade off like to me, you can stick something on a credit card or plan a payment out and you can have less than a week to add your money where it needs to be. If you really do need high liquidity like instantaneously, they do have some pretty good high yield savings accounts like so fi Sophie I'm not sure how you pronounce that by so but that's one of the ones that are available and friends use and abuse. Maybe we'll get them on here to talk about that. We'd have to personally go through much of the high interest

premier has found this Yeah, we never really asked you so muesli right away. So I was like why would I even think the highest one

I saw was like five maybe 5.25%. Currently

what I got when I was researching the high interest savings like there are minimums, there are fees. Yeah, there's all sorts of things that I've seen frequency, all sorts of things. You had to have a minimum you had a minimum that you could start with and you had to hold a minimum balance to earn that 5% I was like I don't like that's just too many obstacles. And I don't like that

thing I found really interesting when I was looking at high interest savings accounts. Majority of the ones that had the higher interest aside from Sophie, were Chase Bank Citibank, like I think American Express has one so it's like these credit card companies are starting to go into that and to me I got like red flags going off in the back of my head. Okay, yeah, you have the on the face brought like you just said with the high interest but like where what are the hidden fees? Because their credit card companies they're all about making their money.

What makes sense logically like what they should be able to offer more than anyone else because the currently interest on credit cards are like 22% So they're trying to nickel and dime people. The next

positive that we had was that it's not market dependent. The price doesn't fluctuate, it's always $10 You're always gonna get that 5.5% unless they have a sale or for whatever reason they like

what they do is more of a dependent but that has no impact on your personal balance. I

assume they have enough of a buffer and even if interest rates go up or down, they have like some offer flexible

or any like in BDCs and Rei T's like whenever they make a loan they do. Like it's not like a set like under like when you buy a house your interest. Your interest is set at like whatever it is like 5% or 6%. When banks do it, they do a variable rate. It's like written into their thing. So if interest rates go up or down, fluctuate with it. I do

actually remember reading that about BDCs. So good point. I didn't have that in here. We already talked about the secured, secured loans being backed by assets of the business so I think people kind of get lumped in that whole thing of needing the security of FDIC insured well, that really is only as good as the banks backing and the environment that we've been in recently like I don't know if you guys really been looking into it. They don't publicize it too too much but thanks for like failing left and right all over the place. So that's been kind of interesting to watch that whole finger down. And I don't think we've ever been at a time where people have less trust government. Generally sense I

think if your whole purpose for investing so that you don't lose your principal, then you probably shouldn't invest.

Yeah, I agree. And that's kind of the point. And we'll probably talk about an episode of that. Like when you're at that level of like safety consciousness. You are so afraid of living in general that like you really, you're not really investing at that point. You're literally just trying to screw up and see preserving, preserving whatever but the thing with with any type of growth, you have to take some level of risk, you have to be comfortable with some level of risk, in my opinion, just based on my dad owns his own business. You do really have to do certain things but a little bit of risk out there to get the reap the benefits. So it's like I actually think the way they back these loans. To me sounds more secure than FDIC insured

for a reason I like okay whenever when I was researching things to invest in outside of the market the reason that I went with worthy is because of the security that the secure back loans but like it also I like other people's that will like this, this this avenue is FDIC insured but then I started to think about what FDIC insured actually meant. That means whoever's in charge of the FDIC at the point, Republicans, Democrats, whoever it is, they have to be willing to bail you out basically like what happened with the SPP back the one that went went under in like February

in our deficit lately, just keeps growing SBB bank

whenever went under, like anything over X amount, I think it was 250,000 was not initially FDIC insured. So why they ever had more than 250,000 and their their whole reason for doing that. I don't I don't know what what happened was because the Democrats are in charge and like they like to throw money around left and right. They said, Well, we're going to insure all the funds in that bank. So like I think the political winds have a effect on what is covered FDIC insured and what banks are going to bail out because not everything that says they're a bank is quote, a bank and the government size always

has weird little loopholes and stuff. So like if you're the kind of person banks with just that claim. So

I tried. I tried to simplify, I was like, Okay, do I really care about the FDIC? insured? I really don't. Because I cared about it. I would just leave in my bank account. perspective,

again, like we're trying to empower ourselves. We're trying to live on ledger trying to invest our money. We don't have to rely on pensions, to rely on government security, like our whole reason for doing all this is to take a level of risk that we're comfortable with to be able to grow our money to a certain point to pay us passive income so that we can live pretty much voluntary and free as much as possible. Because when you're empowered like that, that's when you truly feel alive and you no longer fear death. It's a very interesting state of mind and it's a game changer from where I've come from. It's pretty cool. We were talking about secured loans backed by assets, and part of that is that they'll never be more than two thirds of the assets that they own. Just two thirds it's not 75 Close enough. first lien structured Oh

lien is like for if you have a house and like you owe money to some person, they'll put a lien on your property that means whenever the whenever the loan is paid off, the first listing on that property would be paid before you actually receive your money.

That works too if they default, right that the assets that get liquidated the person who has first lien gets paid first.

So like if you foreclose, like if you foreclosed on your house and you have three ways. The first one was to like whenever they finally auctioned off your items and your house, the first lien will get paid first, the second would be paid second, Worthy is first lien yes, that means if the business folds, they'll sell the inventory, and more they will get first chunk of the money of that before anyone else. Sounds pretty good. I hope that makes sense simplified.

It's passive investing. That's another really awesome piece of it. Like you don't have to worry about price. You don't have to worry about getting it a low price getting out at a higher price. You don't have to worry about navigating changes in yield. You don't have to worry about changes in

Oh, and the other thing I really liked about it was it compounds or compounds or compounds your compound compounds. So like that was nice. So if you want to jump down to that one.

Yeah, so the thing is, like, I think you're actually getting a little bit above that 5.5 or so.

Today's September, 4 day late, September 4, so you put money in and it was like September 7, you put $100 in the $100 is compounding and then probably go into my information straight off 50 cents a day. I'm making more than 50 cents a day. I'm making sure you get your payouts in

your account. You can actually see them coming out here into your account and it'll show you like it's buying a new bond every time you get enough change. In your account

in the last seven days 1234567 My interest collectors went up point 001 in seven days.

So that's what you mean by continuous compounding it

changes like every day like every day my my interest is I'm calm I'm acquiring that day is going to be more than that wasn't

paid on a daily basis and then that's interesting. Like it's

94 cents. Oh, my bad. The whole purpose of this for me was an emergency fund. So if the engine the van goes out or like the air conditioner goes out or the cash need to go to the vet or whatever.

So this is where we put our really like like we consider this as

my as my emergency fund. my emergency fund is what I call it more of a principle and I think everybody who invest should have an emergency cash fund. You should actually establish the emergency cash fund before you start investing. And when you start investing and you have your emergency fund set up, you should invest 75% into your whatever you invest in the market or real estate or whatever whatever you're investing in and 25% should go to your emergency fund. your emergency fund should always be getting larger because you never know like what life's gonna throw like $100,000 Bill happen at any point. You don't

really agree with that. Even up to the six month threshold they talked about up to the six month pressure that everybody talks about, I think it should be like 100,000 you want to go like 500,000 If you

do the 75 to 25 Yeah, no, I wouldn't have no problem having 100,000 and more than making 6% 5.5% whatever it is and then having the extra 400,000 And something else making 10 or 11%

agree that we didn't talk about this unfair because this is

literally for emergencies. You never know like I would rather actually have too much in my emergency fund that have to sell some of my I

do agree with that point of having an emergency fund is to make sure that you do not have to liquidate brokerage assets if they are undervalued to pay for an emergency situation it is to prevent you and that's where a lot of the risk comes from investing in the need to pull money out. So the awesome part about worthy is your principle.

If you think about it like an our brokerage account we make between nine and 12%. Depending on the allocation we have stuff so if I'm making 6% on my mercy

Yeah, that's better than most bonds and themselves. So that's that I don't even know if we said that this was a an alternative to the bonds when we did the bond episode last week. Could be 6%, five and a half percent on some of the other ones.

I think to get to that percentage you have to go down to like the third tier bond like the B BB plus area.

One of the other really awesome parts is you can invest in this passively like they allow you to connect your bank account they Are you to connect a debit card?

I think we're credit well yeah if you whenever you first sign up for it it's like you actually have to input input your whatever your name you want your name to be then you do your your your email so they can give you information they need your address and your phone number. And once you get through that, they send you a text message to verify that you're you that to two layer protection. Then you link up whatever bank account you want, or you can have multiple bank accounts if you want. I did like there was a time I had three of them out here for some reason. I used to have three apparently. And then once you link up your bank account, you can actually start buying bonds at that point. But one of the things I really really like is they but they have to simply have a simplified approach where you can do recurring, you literally just click on and say I want to $100 every week coming out of this bank account going

in here. How do you stay if you stage that so that it comes out like right when your paycheck. Paycheck drops. You can take the money out before you see it. So you don't even really have that feeling of

I'm losing something but you're not losing if you think you're losing that's just a horrible human psychological

thing like the monkeys. It's weird, but that's the way to get around that is to like kind of do it in the

background so you don't see it and then I like to have the automatic rear reoccurring payments and then they have the automatic roundups. So anytime you go to the store or you buy your coffee, or

whatever you do the coffee like example we just bought a friggin loaf of bread a bag

of freaking Cheetos.

Right and s'mores juice. Oh my gosh. And I think our thing was like 25 and 34 cents

or something and they would take the 66 cents and they would actually they would hold it until you acquire $10 And they

bind contributed to worthy and then worthy would have that sitting until you hit another $10 As soon as you hit $10 It automatically buys you a new bond and then the interest in compounding starts

taking effect on the reason that I actually like that okay, I'm not sure if it's just in the Northeast because that's where all the people are. But anywhere you go and anytime you go to the store and you buy something they'll say do you want to donate 32 cents to some some some some charity it's like Nah man, I'm donating 32 senses of the word the charity. It does the same freakin thing. Same thing you're given you're given small businesses, charity,

basically that is valid and you're helping yourself out

at the same time. I don't believe you can actually write that off

though. I don't think there is a right I didn't see anything that talked about philanthropic whatever. So if you do accurate accurate run up I don't think nesting in the hole businesses is a perk. I think the fact that we're trying to invest for our better

I like that because if I donate to say the local food place through my through my round up like so they get 60 cents but it helps like one or two people whereas this if so that not enough people do the roundups, they actually will open they'll help a small business who will help 10 or 15 people who then help their families and their communities. I'd rather help a business visit a business so they actually give more jobs to people but then the people will actually help the community and that helps more than the one person that the

thing I have the issue with a few bank is that like there's so many at least around here. There's so many places and I don't quite understand why they can't donate food they can't sell or they're not going to get sued. Well, that to me, that's ridiculous. Oh my God. Have you seen the people that dumpster dive? It's actually called Freegans I think they're called Freegans they actually eat out of dumpsters.

I mean, we'll try that at some point.

I actually think I want to just to see because I would not be surprised.

When we're on our drinking peacock we'll be hopping in dumpers. Often and dumpsters. dumpers will tell the dumper.

I don't know what it's up to what you're talking about. We're not cool with and heartless. We're

kind of sounds like we're pragmatic. I'd rather donate to what to do the most good and to me the most good is a business that actually is cares about employees and wants to actually like, expand or whatever. So they're borrowing money to expand their small business. To me that actually makes more logical sense than helping a food bank that's going to help 10

People even if they're getting all of our investment, like I just don't trust those little charities unless I've heard of them and I haven't taken the time to do

that whole thing, like the worst charities are stupid. Santa Claus people's. Because if you ever do research behind it, those are the whenever you go shopping into Saturday, you see those? Those assholes with the bell outside Walmart or Walmart or any store then you give them money. You're like, Oh, I didn't look at me. I'm so good. I think it was 96% of that money doesn't actually go to the charity for only 4% of what you donate goes

to charity. And right there is why we are so critical about which charities we invest that

next time you see this that Apple fan us just say I'm good.

I'd rather directly invest in the people who actually need whatever they're trying

to do. Oh, and I'm on another thing. Whenever you whenever you leave like a store and you pull up the stoplight, there's all those on homeless people with their signs out like begging for money. They have when they have nice showered new, nicer clothes than me and they are either they have like a like bottled water which is like three or $4 here and they have like food in their bag. It's like really just get a job.

Anywhere around here is hiring and you can go to any store that says help wanted and freaking work for a week you make more money.

This is true, this is true. They play on our guilt or they try to prey on our guilt.

But it's like anything like if you I noticed on Telegram, for example, there's a lot of spam stuff where they just want money. That's all they want is money. And it's like it seems to be the new norm is we don't want to work for the money, which is kind of nice and what we're doing like the passive money, you don't have to work to make money with your money. So I mean, we've just used that as a less sleazy way to do it, though. We just can't resist use that mentality to do that. But are you telling yourself well, will this Santa was really needed that I need to That that company needs to just go away.

Well, maybe we can make it our mission at some point to go DQ some of these ridiculous charity that the new charity

that actually like anything like would save less than 75% doesn't go to the charity. They just need to be done with it. That's not even that's not charity at that point.

isn't charity. That's opposite for profit. That's ridiculous. In fact, I

was reading that there's another one that's pretty prevalent. I forget what it was. But like it was 90% and went to the company and only 10% went to the charity. It's like the two biggest ones that you see like they were both only donating between four and 10% of the money they get. Yeah, so

that's why that's what the bad tastes are not just mindlessly contributing.

Sorry. Sorry to go off topic. Though.

on a soapbox. Back to the pros. The next one was going to be the fact that your cash is pretty much liquid you can pull it out anytime with no penalty, even though we kind of discussed in the beginning throwing it back in there was huge.

Like that's like the biggest aspect aspect of Where did it go? Like if you've done any if you've done anything where you tried to do alternative investing for your money, they always like quarterly like you can't pull your money out but every three months. That's

your emergency fund. ludicrous to

me, like I don't know,

community impact was the next one which we were talking about small businesses and real estate developers, which was on Santa Claus

really impacts like what it's all about, like, would you rather help a family or help a community? I'd rather do a community where it's more efficient. It sucks to not saying a family but whatever. You don't like it then don't listen.

Oh my but it's true. Like we want to help people who actually want to help themselves.

I've noticed I've noticed more research that if you help a community it actually is more beneficial than helping an individual family like it's been proven time and time and time again with studies. The whole fish teach

person to fish versus giving them a fish thing you create helpless this by giving them a fish but you actually create like skills and resiliency by helping them learn to fish.

Like the last one I read was in some psychological publication like they actually did some more like they helped a family achieve what they wanted a year and like it didn't really percolate beyond that family was they help the community. The community then helped every family that had like, troubled in that during that year's period of time they'd help them with whether it was sued or yard work or whatever. So like if you do a community either as actually more beneficial than the individual so we're looking for snowball effects with our it's all about efficiency if you know the personality types on that on the most on the most efficient personality type. So

even to the point of sounding like a cold hearted.

I'm not cold.

I know but I said sounding like one

thinks I am but I'm not.

I know. A moral compass like a pretty hardcore moral compass. This is better.

I'm not opposed. To help you feel like I actually think that the purpose of this podcast is to help people I died not opposed to helping people but they like they want to have that one that I'm not just going to help people to help them. Okay, off the box box.

And then the very last one which I do think we need to reiterate compound interest daily, I cannot express that enough compound interest daily. The magic of compound concept

of your dividend stocks if you've actually purchasing the like it literally doesn't seem like

it's much in the first couple of years. But go online find any freaking YouTube video that talks about compound interest when you start seeing those things go up? I think I think it's at 7% you double your money in seven years, I believe.

Seven years later on, I was just looking at like if I don't put any more money into it, I'm still it's still gonna. It's gonna double within like 12 years. Yes,

freaking compound interest is amazing. And then because of the exponential factor, and it's reinvesting and compounding more I think the next time you hit your next doubling is like

halfway through the like, okay, the math behind compounding is beautiful in itself. But I think the most important part that is always overlooked when it comes to compounding is the psychological factor of whenever you put say $1,000 into something that you check back in six months, and it's now saying $1,200 You're like, well, I made two I made $200 doing nothing. So you're more apt to actually either put more money in or do more investment areas where you

can see the invest like a compounding day and day out you do get excited to put more money into it. And because you're not really taking money away from yourself, you're actually seeing that money's adding to yourself. You get excited about finding ways to save more money. So like I really recommend doing worthy especially if you're dipping your toe in the water or just starting just starting with investing. It's an amazing way to make 6% Honestly I think that beats a lot of hedge fund managers systems

and the psychology behind it like I haven't found a study I've ever do will actually post on the website but like the the psychology of me see something that is working for you or paper works for you and you're like, wow, I didn't even have to do anything for that. All right,

let's roll over to the con list. Two things right. It's actually a couple of things. So the non FDIC insured thing is something we talked about but not really that big of a deal but if it's a deal breaker for you, you should have ejected from this podcast like back when we were talking about

it. Because everything that we invest in, there's no guarantee. So yeah, absolutely nothing invested. Like there's no guarantee in anything like I would rather take a risk as small risk on something that's not FDIC insured, then not take a risk at all. And then die like five years now and without doing anything, like I mean, there's no guarantees in any aspect of life. So I don't know why people need that with certain investments. So there are a lot of my box again. Apparently this is just so box day, he

didn't sleep very good last night, so he's a little bit crotchety like an old geezer by law lawn. His cat gave him his white paper Stan tongue bath like for this asshole cat.

I before I went to bed last night he was sitting there laying beside me looking at me going I gotta lick you later. And then like when I fall asleep, he hops on my back and like licks my head and my ears and my face and everything is so annoying.

Like and he has, I think the most sample every time. It's horrible. He was Parana lurking. The next one is that they only issue $50 million in bonds each year. So if you don't get in before, I guess they run out of what they're allowed to buy the SEC to provide as long as you're basically can't put any more money in until the following year.

So then if that happens, that's when he started investing in the bullet shares because they pay 6% as well. Yeah, and they're pretty, they're their Beta is really low. It's pretty we're gonna

do a podcast episode maybe next about the board shares because the board shares are an awesome way to have them in your brokerage account.

They're more liquid than worthy but they do a little bit of price fluctuation pretty much the same, pretty much the same thing for high interesting. So and then I keep all my dry cash and the brokerage account that I'm gonna say waiting for a discount device.

Allegedly, you're only allowed to invest 10% of your annual income or net worth, or $50,000 is the cap for an individual I think unless you Well,

I can tell you that. That's bull crap because I've already put 5800 into it. I'm only making like 20,000 this year, so I don't they don't check on it. But I don't know if they really keep keep that Narcos out. No, no, no, no. Snitches, loud.

And then the last one is not gonna apply to everybody. But this is an America only thing right now. Apparently they have plans to expand to the EU sometime soon. I don't know when that's gonna happen but if you are UK or somewhere over there, get ready where are these going to be awesome for

you guys? Yes, that's something that everybody I think everybody should have money in this like that's all the reason I'm doing this episode because it's it's super important.

All right, and then you don't just like your dad multiple different kinds. of accounts that you can invest and you can actually do an IRA already, which I didn't even know this. So I started looking into this. They do trust accounts. They have nonprofit something set up. They offer individual they have business accounts. Pretty interesting. Again, I'm not so sure I liked the idea of the IRA just because we're looking at this from a secure emergency fund liquidity thing, but if that's something that works for your goals and your metrics and everything, power to you, man, they have a lot of really cool options, which is cool.

I mean, there's like Another con is they're not the highest yielding, like high interest savings. You can find others yield more. I haven't seen it to me they're the simplest. So that's a huge Pro. That's super simple. Yeah, I

do like this, like on the automatic.

I do a bullet sharing to pay 7% I'm just saying like it's not okay,

why wasn't looking at that from that perspective. And then we've actually looked into some alternatives to where the there's a company called I bonds. That's

a federal thing. Get some opportunities. I had a bond that the government it's a basically that that bond is specifically tied to interest rates and inflation and that it deviates too much from my liking. Like just like, I think in March or April, it was like 10% And now it's back down to like 4% I don't like how the deviation habits that lack control and consistency

are looking for a fixed income and set it forget it type deal for this type of account. And then main vest was the other one. I've never heard of that one either. But he said that he

researched it whenever I was doing the word and like it's, it's basically it's like it's like a peer to peer site. I'm not sure if you guys know that you can actually put money into these peer to peer sites. And then you scroll through like 100 different listings and you pick which ones you actually

have to pick the companies you're gonna invest in. So you have a lot more risk because you're actually putting more effort

you have a lot more risk, but it's all on you at that point because you pick the company. It's not

really passive, like worthy is where you just

in the main rescue, it's your money's tied up for three years, five years, 10 years, whatever it is, you're getting a higher percentage, it'll be like 12 to 18% if they actually pay, but it's tied up for years and years and years. It's like there's no liquidity.

And then again, the other alternative to worthy as the high interest savings account, which there's tons and tons of them out there. They're always changing interest rates. You guys have a really awesome experience with one that you want to talk about. Email us, let us know. We can maybe even throw you on here if you want to do a do an interview,

and I promise I won't be on a soapbox that day. I can't make that promise, but I do my best.

Okay, so this episode, we talked about what were the is it's freaking awesome way to earn a lot more than normal savings accounts. And then we went through the pros and the cons, couple comments from the CEO and at the very end here, so to get started, we're gonna post a link for our referral code down in the show notes because if you use our referral link, both you and us will get a $10 bond for free. So if you sign up for that, that gives us some money, some incentive to keep this podcast rollin and also give you a good start. Who can argue with free 10 bucks like seriously, I've watched people get away from this kind of

think now I do. I don't know what the tax implications are. I'm pretty sure it's just so like your will have to pay taxes on it.

You do have to pay taxes. On the interest. It's just like a normal 1099 It's pretty, pretty standard for anything. To be honest.

I always forget about a textbook for everything. It's Williams for our accountants like he's the best, but he's the worst. Like he's really good at what he does. It's just a matter of getting him to do what he does.

He's really into philanthropic philanthropic stuff. So he does the accounting thing like I guess as a side, a side hustle, but it's like

we'll drop the papers off in January. We won't hear from him until like August. It's like luckily, we're not on top of things because now

I feel like we need to follow up and pay him and make sure we actually signed some papers to get our money back or pay in or whatever. So Alright guys, that is the end of the episode. Next

episode is gonna be on preferred shares I know very exciting. We will see you guys on the next episode. And I'll be less crotchety Get off my lawn.

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