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<v Speaker 1>Right now, let's say good morning to the host of

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<v Speaker 1>How to Money from noon to two on Sunday. Right

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<v Speaker 1>here on KFI, it's Joel large Guard. So Joel, President

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<v Speaker 1>Trump says it's time to ditch the pennies.

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<v Speaker 2>Hey, I've been saying this for years, Amy, nobody's listening

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<v Speaker 2>to me.

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<v Speaker 1>But well, apparently you got the president's here.

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<v Speaker 2>Maybe maybe I doubt it, But this has been a proposal,

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<v Speaker 2>a bipartisan proposal. Actually, there have been people on both

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<v Speaker 2>sides of the aisle saying, hey, the penny, it's long

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<v Speaker 2>overdue to get rid of it. Especially like think about

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<v Speaker 2>when the good old days, when my grandma would tell

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<v Speaker 2>me about buying a coke for a nickel, and that's

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<v Speaker 2>five pennies, right, and so, like pennies actually mattered because

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<v Speaker 2>you could buy stuff with them. There's like essentially nothing

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<v Speaker 2>that you could buy for a penny anymore. Even think

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<v Speaker 2>about like dollar stores. Most of the dollar stores have

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<v Speaker 2>gone away from selling things for a dollar because of

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<v Speaker 2>rising prices, and so you can't really buy as much

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<v Speaker 2>for a dollar anymore. So the fact that the penny

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<v Speaker 2>costs more than a penny to make essentially almost four

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<v Speaker 2>pennies to make a penny, I think it makes sense

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<v Speaker 2>to get rid of it. And then the next thing

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<v Speaker 2>potentially on the chopping block is the nickel.

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<v Speaker 1>Oh okay, so how you said that to make a

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<v Speaker 1>penny it costs four cents. How many pennies do they

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<v Speaker 1>make every year? Do we know?

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<v Speaker 2>So that is a good question. Usually what they're doing

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<v Speaker 2>is they're attempting to make pennies to because there's some

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<v Speaker 2>of these fall out of circulation. So when you put

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<v Speaker 2>your pennies, I think there was a billions of pennies

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<v Speaker 2>churned out last year, maybe three billion pennies. And I

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<v Speaker 2>think the reason is essentially because when you stick them,

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<v Speaker 2>when you lose them in your couch cushions or you

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<v Speaker 2>stick them in some sort of a jar to kind

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<v Speaker 2>of save up, those pennies fall out of circulation. And

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<v Speaker 2>so the US mint has to replace those pennies. So

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<v Speaker 2>what's it going to look like. It's not that we're

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<v Speaker 2>gonna like stop seeing pennies immediately. Pennies will still be

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<v Speaker 2>in circulation. It's just so we will stop minting new

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<v Speaker 2>pennies to basically, you know, make up for those pennies

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<v Speaker 2>that we have either lost, not picked up or stuck

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<v Speaker 2>into a jar.

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<v Speaker 1>Somewhere and we can save a lot of money on it.

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<v Speaker 2>Yeah, I mean this is a good this is Obviously

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<v Speaker 2>there's been a lot of focus in these first few

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<v Speaker 2>weeks of the Trump administration on cost cutting and some

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<v Speaker 2>ways some people would say really great ways, and other

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<v Speaker 2>people would say, oh, man, I don't really like what

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<v Speaker 2>they're doing over here. I think this is at least

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<v Speaker 2>one of those things where the vast majority of people

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<v Speaker 2>can agree on the fact that pennies are essentially worthless

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<v Speaker 2>and there's no reason to manufacture them anymore, especially as

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<v Speaker 2>our world gets more and more digital and paying with

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<v Speaker 2>debit cards. Credit cards are just kind of the norm.

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<v Speaker 2>Pennies are just kind of more of a pain than

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<v Speaker 2>they are a solution.

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<v Speaker 1>Okay, so if you are still pinching pennies. We were

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<v Speaker 1>talking about how much is a fair fee for investment

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<v Speaker 1>companies to take because they need a coot to stay

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<v Speaker 1>in business, and what is that? Is there a hard

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<v Speaker 1>and fast number, Jewel.

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<v Speaker 2>So there's not really a hard and fast number. But

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<v Speaker 2>over the past few decades this has only gotten better

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<v Speaker 2>and better and better. For individual investors, it's become fees

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<v Speaker 2>have dropped precipitously. And this is honestly, I think we

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<v Speaker 2>can call it the Vanguard effect because Vanguard was the

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<v Speaker 2>was the low cost brokerage firm launched by Jack Bogel

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<v Speaker 2>in the late nineteen sixties early nineteen seventies, and he

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<v Speaker 2>kind of invented in some ways the index one. He

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<v Speaker 2>didn't fully invent it, but he at least brought it

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<v Speaker 2>into the mainstream in that in particular, in his focus

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<v Speaker 2>on lowering fees for investors, basically was the lowering tide

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<v Speaker 2>that lowered all fees. And so Vanguard literally just announced

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<v Speaker 2>last week they're lowering their fees even more, and they're

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<v Speaker 2>basically the lowest cost fe brokerage firm in existence, and

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<v Speaker 2>they're lowering fees even more. The average fee now on

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<v Speaker 2>a Vanguard fund is point oh seven percent, which is

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<v Speaker 2>pretty miniscule. The rest of the industry is point four

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<v Speaker 2>to four percent, almost half a percent. So the difference

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<v Speaker 2>between what you're going to pay in fees based on

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<v Speaker 2>where you're investing could be significant.

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<v Speaker 1>Are they expecting others kind of follow suit or are

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<v Speaker 1>they going to just say, no, we're keeping our fees

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<v Speaker 1>where they are.

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<v Speaker 2>They don't care. They don't care if other people follow suit.

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<v Speaker 2>But the truth is other people have to, right because

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<v Speaker 2>this is why like Fidelity, which is another one of

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<v Speaker 2>my favorite brokerage firms, has launched what they call zero

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<v Speaker 2>fee funds, Like I don't know, this was probably seven

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<v Speaker 2>or eight years ago, and so they literally have a

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<v Speaker 2>few in house funds that charge a zero expense ratio.

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<v Speaker 2>And when you think about what this means for investors,

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<v Speaker 2>the fact that that Vanguard just cut fees by a

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<v Speaker 2>little bit, well that's big news in some ways, but

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<v Speaker 2>it's not big news in other ways. The big news

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<v Speaker 2>is what individuals do with this information. And the truth

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<v Speaker 2>is where you invest matters. If you're with a really

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<v Speaker 2>high cost firm where they charge a lot of money

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<v Speaker 2>for advice and where they charge a lot of money

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<v Speaker 2>for you to own a fund that's very similar to

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<v Speaker 2>what you can get much cheaper at like Fidelity, Schwab

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<v Speaker 2>or Vanguard, then you're overpaying. And so this should be

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<v Speaker 2>just another reminder to everyone out there who is investing,

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<v Speaker 2>which is great, to check your fees and to make

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<v Speaker 2>sure more of your money isn't going to pay the

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<v Speaker 2>fund manager than is going to invest in assets that

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<v Speaker 2>are going to grow on your behalf for years and

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<v Speaker 2>decades to come.

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<v Speaker 1>Okay, so always ask that question before you make your investments.

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<v Speaker 1>How much am I paying you?

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<v Speaker 2>Yeah? How much am I paying you? And then almost

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<v Speaker 2>how much does just the fund itself charge? And you

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<v Speaker 2>can go into the back end of your investment. You

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<v Speaker 2>know your investment company. You can see Oh wait a second,

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<v Speaker 2>the expense ray show on this fund. You need to

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<v Speaker 2>type it into Google. Right, So, like Voo is one

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<v Speaker 2>of Vanguard's S and P five hundred funds, and I

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<v Speaker 2>think the expens ray show is like point oh two

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<v Speaker 2>or point oh three. It's it's essentially non existent. Go

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<v Speaker 2>type in those letters from your fund that you're invested

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<v Speaker 2>in and figure out what the expense ray show is.

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<v Speaker 2>If it's above point three point four point five, you

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<v Speaker 2>should be thinking again and seeing if there's lower cost

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<v Speaker 2>place you can do business. And I guarantee you there is.

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<v Speaker 1>Okay, always great advice from our buddy Joel Larsgard, and

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<v Speaker 1>you can get more information about how to manage your

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<v Speaker 1>money and other great advice every Sunday from noon to

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<v Speaker 1>two right here on KFI. It's called how to Money

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<v Speaker 1>with Joel Larsgard. You can also follow Joel on Instagram

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<v Speaker 1>at how to Money Joel