Un-Bee-Lievable Money Lessons
by SGL Financial
Our 2 Cents – Episode #255
Un-Bee-Lievable Money Lessons
We’re buzzing with a brand-new episode of Our 2 Cents! On today’s show, the Lewits share their quotes of the month, summer vacation budgeting tips, what bees can teach us about finances, and May’s financial focus. Tune in now and catch all the sweet financial insights!
- Quotes of the Month:
- “When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.” – PJ O’Rourke
- “An acquaintance is a person whom we know well enough to borrow from, but not well enough to lend to.” – Ambrose Bierce
- Summer Vacation Planning:
- Summer is almost here! Planning a getaway? Here’s what to do to keep your trip fun without blowing your budget.
- Wealth Wisdom from the Hive:
- What can bees teach you about handling your finances? More than you might think.
- May Financial Planning Calendar:
- This May, we’re spotlighting emergency and liquidity planning.
- Learn smart, actionable ways to set aside funds, stay flexible, and stress less when life throws surprises your way.
Request Your Free Consultation Today
847.499.3330
Podcast Transcript
Announcer: 00:02
You’re listening to Our 2 Cents with the team from SGL Financial, Building Wealth for Life. Steve Lewit is the President of SGL Financial, and Gabriel Lewit is the CEO. They’re here to discuss all the latest in financial news, trends, strategies, and more.
Gabriel Lewit: 00:24
Hello, hello, everybody, and welcome to another episode of Our 2 Cents. You’ve got Steve Lewit here, the Master, the Maestro.
Steve Lewit: 00:32
And the uh I’m trying to think of something that rhymes with an M. And the uh the Master, the Maestro, and the um and the uh help help me out here. I don’t know. And the uh maker oh good, magnificent. Thank you.
Gabriel Lewit: 00:48
Here I am for the I gotta make you feel good in the morning. Applause, please. Yes, yes. And you’ve got here uh Gabriel Lewit, of course, uh the two of us here to show you all the world of finance and interesting things that you may not be aware of. All the sense we can give you. But I think I’m building up our show here today to be. So, Gabriel, I have a question for you. I have a question for you.
Steve Lewit: 01:11
So, I came in this morning, and one of the guys was running around the office trying to find he’s afraid of spiders. There’s this teeny, little spider. Uh-huh. Now, are you afraid of spiders? You know, I’m not afraid of the ones around here. I mean, there’s a panic I don’t like them. There was a panic here over this little tiny spider, and and then someone gives me like like our our um some uh uh someone says, well, that spider could jump. You better better be careful. It’s like what’s going on here? It’s a spider.
Gabriel Lewit: 01:46
Yeah, no, unless we had you know giant arachnids, you know, like the really big like the tarantulas like you put on your shoe and there’s a tarantula tarantula in your shoe. Those are not spiders. That would be those are just a little tiny thing. Yeah, that would be real problematic for me. But yeah, if it’s a tiny little spider, no. I don’t I’m not scared of them, but I do do I like them. The answer to that would be a definitive no. Do I want them in the office? No. In my house, no. Uh so we gotta get them out of here.
Steve Lewit: 02:14
Well, I agree, but it’s it’s just the amount of energy that went in. Are you scared of them? No. Okay, that’s good. No, I’m a man. I’m Steven the Magnificent. There you go. All powerful. Oh, well, I shouldn’t have said that.
Gabriel Lewit: 02:29
You’re gonna be riding high today. No little spiders for me. Well, let’s start off here, folks.
Steve Lewit: 02:33
We’ve got a great I hate spiders.
Gabriel Lewit: 02:34
We’ve got a great show for you here. We’re we’re gonna talk a bit about our May financial planning calendar topic, okay? Which if you joined us earlier in the year, we laid out a schedule for the year, month by month, of various financial planning topics. And May’s is all about I sold on. I had it right here in front of me. I just got to find it again. But May’s is all about drum roll, emergency and liquidity planning. It was hidden behind a few other sheets of paper that I had here. Okay, so you know what the Boy Scouts say. Always be prepared. Yeah, man. I was prepared. Yeah, but you left an empty space there. I was filling it with me talking. Yes, you are. No worries. Ums and uhs. And we’re also going to talk about what kind of financial lessons can you learn from bees. Oh. Did you know that?
Steve Lewit: 03:19
Well, I know bees are really smart. If you yeah, if you want to I don’t know what they know about money, but want to master your money, you just have to watch the bees. Well, they’re really smart little creatures. They are. Now, do you like bees? Of sure.
Gabriel Lewit: 03:32
Unless they’re the giant carpenter bees that are disgusting. Well, if a bee lands on you, what do you do? I shoe it off. You shoe it off. Yes. I don’t run around in a panic. Okay. Uh, we’re also gonna just to have a little fun here, just two short quotes of the month, as we often like to give you a little bit of entertainment here. The first one is from an old author and journalist, P.J. O’Rourke. Uh this might fit in the current climate. When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.
Steve Lewit: 04:04
I love PJ. I used to read PJ back in the day a little bit. Yeah. Wow, yeah. Well, they’re all bought and sold.
Gabriel Lewit: 04:15
You know, someone with zero net worth gets elected, and all of a sudden two years later, they’re they’re multimillionaires. Like, okay.
Steve Lewit: 04:22
I I do you recall there was an article that said how much it costs to run for office, like $90 million. It’s a lot. Yeah, a lot.
Gabriel Lewit: 04:30
Yeah. The other one is from an even older journalist and author, Ambrose Bierce. Ambrose Bierce. Bierce, yes, says an acquaintance is a person whom we know well enough to borrow from, but not well enough to lend to.
Steve Lewit: 04:45
That’s very good. Could I have some money? Yes, please.
Gabriel Lewit: 04:48
When did Ambrose live? He was like 1842. Oh, he’s an older. He was even older, yeah. He’s an oldie. He’s an oldie. There’s only black and white photos of him, that’s how you know.
Steve Lewit: 04:56
Yeah, with mustaches. Oh, here.
Gabriel Lewit: 04:59
Totally rolled mustaches and bow ties. Bow ties. Bow ties, yeah. Classy dapper man, he looks like.
Steve Lewit: 05:06
Well, everybody back then looked dapper. Yeah. They were all like top hats and dressed up, you know. Yeah. Go out and put out the garbage and you were draw how to dress up.
Gabriel Lewit: 05:16
Well, there you go. Those are your two quotes of the month. Hopefully you enjoy them. Uh, let’s talk a little bit about planning for your summer vacation here. Uh, it’s about that time where if you haven’t thought about it yet, hopefully you have, but you know, maybe it hadn’t been on your radar up until this point. But the question is is have you planned for it financially? And especially this year, uh, you all know what’s in the news with gas prices and not just in the news, you’ve seen it when you filled up your tank. And I know you you like to talk about that a lot.
Steve Lewit: 05:45
So, we don’t have to don’t get me started at $110. Yeah.
Gabriel Lewit: 05:49
So, uh what do you do here? Well, you should like anything, you know, that’s gonna involve spending a good chunk of money. Try to plan it out. So, if you are thinking about taking a trip, uh, what are you gonna do? Where are you gonna go? How are you gonna get there? Where are you gonna stay? What kind of budget do you have for activities? Right, it’s uh it doesn’t have to take you a lot of time, but it’s something where you are gonna be better fiscally if you plan this out and you try to stick to a travel budget versus if you just go there and just spend on the credit card. And it’s funny, you were saying this sounds a lot like a like a WGN clip or something.
Steve Lewit: 06:26
Yeah, it’s the it’s the kind of question they would ask me on WGN. Steve, can you give tips on travel and so and yeah, uh the first thing I would say is, you know, have a budget. But let me ask you this, Gabriel. When should you plan that budget? What are you doing?
Gabriel Lewit: 06:40
There’s a fuzz that’s on the on the speaker thing that’s tickling my nose.
Steve Lewit: 06:46
It’s really hard for me that in the morning to deal with Gabriel, folks.
Gabriel Lewit: 06:49
I just want you to know that it’s really hard to speak into a microphone if it has a fuzz with a microphone. That’s yeah, that’s tickling my nose, man.
Steve Lewit: 06:58
Here’s here’s the problem, folks. I’ll share it with you. So we’re expanding our office space, and our office is fuzz and all kinds of things, and my son is being hyper-focused right now and ignoring you all and ignoring this.
Gabriel Lewit: 07:13
You could continue the topic, but you have to stop and focus on me here. Yeah. So, anyways, what were we talking about since you had to point out I was trying to be surreptitious about this? Is that the right word?
Steve Lewit: 07:25
Uh about the WGG and with the starting with a budget. Yeah. And and my question to you really is what what do you plan your vacation or say okay, I have a butt. When do you plan your budget?
Gabriel Lewit: 07:37
Well, to make this perhaps a little bit even broader, yeah. I mean, in your annual budget for the year, as you become a client of SGL, we have you or request that you do your budget here, and we’re we ask that you update that every couple of years, but you may have a line item in there that’s your annual travel budget. Yeah. And that’s where you would typically start. Uh so let’s say your annual travel budget is, you know, ten thousand dollars or five thousand dollars. Then the question is, well, where and how are you gonna use it? Are you gonna use it on a summer trip? Are you gonna use it on a winter trip? All right, you have to start to get a sense of your planning and travel calendar for the year. But then we can drill down, and let’s say one of those was your summer vacation. Now you start to really inventory your trip, right? The most common expenses on your trip are gonna be very simple. It’s gonna be your lodging. Okay, so you’ve got to pick where you’re going. Let’s say you’re gonna drive from here to um Idaho. You’re taking a vacation to Idaho? I don’t know. It just came to my mind. Well, sure. Okay, so you’re going to the top attraction in Idaho, which maybe it’s a potato. A plane. Yeah, I’m full where I’m flying to I’m flying to Idaho for some reason. I don’t think that’s a top vacation destination. Okay. The uh well, the top sites in Idaho, uh Craters of the Moon National Monument. There it is. I am Shoshone Falls Park. I always wanted to go there. Uh the Silverwood theme park and the lava hot springs. Well, those are some fun places. You got a little white water rafting. Yeah, the lava hot places is good. The old Idaho Penitentiary site. Oh man, I was looking forward to that one. Yeah. Okay, okay. So yeah, so you gotta pick your hotel.
Steve Lewit: 09:17
Yes, Idaho uh um double tree in.
Gabriel Lewit: 09:22
Yes, exactly.
Steve Lewit: 09:23
Well, here’s here’s the thing. People plan their vacation outside of they they kind of isolate it. What they do is you might have a this is what I find people do, and sometimes I do this myself. I’m saying to myself, hey, look, um I’m gonna spend 10 grand on a vacation. And and we start planning the vacation, and it’s like, well, that hotel is a little better than that hotel. And that hotel and that site, you know, let’s get a private tour guide or let’s do this. And and all of a sudden it’s 15 grand.
Steve Lewit: 09:55
Yeah.
Gabriel Lewit: 09:56
Well, a lot of people this year have changed.
Steve Lewit: 09:58
And then we say, okay, we can fit it in.
Gabriel Lewit: 09:60
Yeah, what the article here is talking about is 65% of Americans this year, 2026, have already changed their travel plans due to rising costs. Notably, some are canceling because the the price of gas has now ballooned this past their budget. Same with the price of airfare. Some of the tickets are quite a bit more expensive now than they were before. Uh so you may have to reevaluate your budget and you may have to reevaluate where you can go. Uh hopefully you are still able to take a summer vacation if you feel like it’s just gotten too pricey and you can’t afford it now at all.
Steve Lewit: 10:33
Well, it’s not only the gas prices, Gabriel, but all the prices are up. So, a lot of people are you know having a hard time getting by, just getting by, including their $5,000 vacation. And then they go to take their $5,000 vacation, and it’s $8,500. It’s like people can’t do it.
Gabriel Lewit: 10:52
Yeah, yeah, it’s it’s becoming harder and harder to travel, and you know, you either have to take uh a couple options that you can explore is you know a shorter trip, right? But that doesn’t help you too much with the the expenses of traveling to and from, right? But it does help with the lodging cost. Um if you were gonna fly, you could take a drive. It may not be um as cheap as it was, you know, six months ago, but generally if you’re going five with five people, can’t fly spirit airlines, not anymore. But if you’re trying if you’re flying with five people, driving can often be a little cheaper, although the gas prices is tricky there. Um you know, you can uh when you’re there, you can you know perhaps you know just uh do a little less eating out, you know, rent a place that has a kitchenette. That has a kitchenette, right? It’s great. Yeah, you know, uh you can also maybe instead of going to you know Disney World, you go to a state park. Yep. Right? You look at something that’s a bit more in tune with nature. Um so there’s lots of options if you’re feeling like the budget’s getting too tight and you’re you’re wondering what to do. You know, we can uh we could help of course help you brainstorm those, but there are choices, and the biggest thing though is trying not to blow through your budget. I I think that I think that’s the message committed to this vacation, and you get excited about it.
Steve Lewit: 12:04
Don’t build up a credit card balance because that’s how you’re gonna pay for it, and now you’re gonna pay 22% on that money, and it just compounds down the uh with the rapids. You know, it’s just it can’t get better. Yeah, exactly.
Gabriel Lewit: 12:20
Well, that’s uh, you know, really the main takeaway there is if you haven’t planned your trip, plan ahead. If you’re not sure what you’re gonna spend, start thinking about it and make sure you stick within your fiscal budget for your annual travel expenses, but also your summer vacation. Before summer is here, if you’re like me, you procrastinate a lot, and uh I finally get around to thinking about what I want to do when the summer is half over. Yeah. So it’s a good time now as you as you start planning it.
Steve Lewit: 12:45
And if anybody out there wants more information on Idaho, just uh feel free to ring me up. Call Steve’s cell.
Gabriel Lewit: 12:52
Call Steve 24/7, 24/7, Idaho travel expert. Yes. So uh I I I’m actually kind of curious, it’d be a fun trip. Some of those places sounded pretty good.
Steve Lewit: 13:04
Idahoians, if that’s how you call them, uh love Idaho. They don’t want anybody there. I have one client who actually lives in Idaho or has a place in Idaho, a big ranch. And he’s what they say is that they’re seeing more and more tourists and they hate it because that privacy is going away.
Gabriel Lewit: 13:23
Yeah. Well, could be. Could be. Well, let’s talk about bees. Okay. Well, that’s an interesting trend. Let’s just talk about bees.
Steve Lewit: 13:31
We’re going from vacation to bees, folks.
Gabriel Lewit: 13:33
Yeah, so let’s move on. Let’s move on. Okay. Let’s talk about some of uh the financial tips you can learn from bees. We are we try to make finance interesting. If we just every time we just said the same thing, you guys would stop tuning in. We got to try to keep this fresh. So, you didn’t know you’d learn money tips from bees, but now you now you know. Uh folks.
Steve Lewit: 13:52
Okay, or you will shortly. I I’m with you here. I have no idea where he’s going with this, but I’m following.
Gabriel Lewit: 13:58
Well, the reason I’m bringing this up is uh well, yesterday or two days ago was World Bee Day. Okay, May 20th. And as everyone I think knows, uh the world they say would not exist without the bees. Really? Yeah. Right? Because they pollinate all the flowers and all the stuff, and if there were no bees, and it’s actually a big deal. Yes. Bees are very important creatures. Yep. Except for the ones burr you know, burrowing into your your your housing, right? The carpenter bees. They’re horrible. I don’t like those guys. Yeah. Have you ever seen one of these things? They’re like gigantic.
Steve Lewit: 14:32
What am I gonna learn from bees, Gabriel?
Gabriel Lewit: 14:33
They’re like a bat. Okay, the first thing from uh first lesson. Give me some build your honey reserves. Okay, but bees don’t wait till the dry season to start collecting honey, they’re actually preparing ahead for lean times. Right? The average bee makes about uh one twelfth of a teaspoon of honey in its lifetime, but together the colony stockpiles enough to survive harsh conditions.
Steve Lewit: 15:00
That’s really interesting. So, one one bee makes one twelfth of a teaspoon in its lifetime. Mm-hmm. How long is this lifetime? I don’t know. Could you not that long? Gabby. Probably not. Could you look that up, Gabby? Uh folks, listen, reserves two to three years. Two to three years. Two to three years. Reserves are very, very important, as you all know. The question is, is do you have them? Right?
Gabriel Lewit: 15:30
Yeah, but yeah. The bees are telling you that it’s a wise move to build reserves and we as people can learn from that, right? If we are saving, uh, you are building reserves.
Steve Lewit: 15:41
Now what now a bee uh doesn’t know this, but it it it does a certain amount of reserves in its lifetime. How much reserves should a person have financially?
Gabriel Lewit: 15:54
A person should have it’s there’s no one magic number enough for them to feel financially secure, which could vary, but usually, you know, six months of of your core living expenses is a common number. Could be for some it’s twelve months, minimum three months.
Steve Lewit: 16:10
What would you say to a person that comes to you because that person came to me and said, I need two hundred thousand dollars in cash in my reserve account. Well, you know, you you do you feel you really need it? Yeah, I’m I I want to be able to get it right away. Can they afford it?
Gabriel Lewit: 16:28
They really should invest that money somewhere else. Well, you could do half of it in true cash and then the other half in a in a cash alternative reserve. So, see if they can compromise. Yes. And the cash alternative would still be safe and accessible but hopefully earn a little bit more interest. You can bridge the gap. It doesn’t have to all be pure immediate cash.
Steve Lewit: 16:49
Did you know that 60% of the country doesn’t ha has less than five hundred dollars in their reserve account?
Gabriel Lewit: 16:55
Uh probably. I believe that. Yeah. Yeah. Well, the next tip from the bees here is diversify your pollen sources.
Steve Lewit: 17:04
I I’m smiling because it’s so true. Well, they just don’t go to one flower.
Gabriel Lewit: 17:09
They don’t. They they buzz to many flowers and I I think trees and stuff too. But yeah, they visit thousands of different blooms. Okay, so if one flower is, you know, out of what is it, nectar or something? Pollen? Or they’re pollinating the flowers. Son, I grew up in the South Bronx. I’m not a bee expert here. I just came that out there.
Steve Lewit: 17:30
I grew up in the South Bronx in New York City. I didn’t know what a horse was until I was 20 years old.
Gabriel Lewit: 17:36
Well, I know what bees are, I just don’t know the inner workings of bees. But the point is they don’t they don’t just rely on one flower or just focus on one flower. They diversify, right? And obviously the lesson there is with your money, diversification is a way of reducing risk, okay, by spreading your money around different investments. And that’s a wise lesson that some people to this day still struggle with. I just encountered a client the other day that had almost half their money in a single company stock. And that is not a very diversified investment plan, and that carries a lot of additional risk. Very un-bee-like. Very un-be-like.
Steve Lewit: 18:14
Well, think about it. Nature constructed this particular bee that supports all life in uh on the earth to not count on just one thing. And there’s certain wisdom in nature in terms of survival, and that’s you know, i i if the bee only uh you know fed on uh tulips and tulips had a bad season, that would affect everybody’s lives. So, it’s the same way in a family unit. If if you don’t diversify your portfolio, you yeah, your your investments won’t perform, but it but it affects the whole family. It’s not just a uh isolated event.
Gabriel Lewit: 18:53
Well, I think, yeah, I was actually gonna bring up the next B lesson, is that they all work with the hive. Okay, they’re very teamwork community oriented. Like ants. Uh kind of like ants, but we’re fought we’re talking about bees here, okay?
Steve Lewit: 19:09
I hate ants.
Gabriel Lewit: 19:10
Nobody likes ants, right? But you know, they they have a team-based approach. It’s not just just me, me, me, me, me, right? They’re thinking about uh helping the team, right? Working as a team. And with your finances, it’s also good to have a team approach, whether it’s you and your spouse, whether it’s you, your spouse, and your family coordinating for a multi-generational legacy plan, uh, as opposed to there are some parents that will never share uh uh just the iota about their finances with their kids for whatever reason, it’s maybe how they grew up or they don’t feel comfortable with it, the relationship’s not there, but a lot of studies show that if you if you talk about these things, the the legacy transfer process can be enhanced, the tax planning can be improved. Um, right, you know, kids can plan their lives perhaps even a little bit better. That’s just another take on this here. Also, you could say they work with their financial be advisor, right? It’s a stretch, but I like it. Their team it’s a stretch, but you know, they like it. They don’t just go it alone. Okay, was where I was headed with that.
Steve Lewit: 20:13
Yeah, and I think that the the other part of that’s hidden in there, the jewel that’s hidden in there, is they trust each other. You know, they they can communicate and they trust each other, they communicate well. And folks, what we find in in many family units is that there is like you said, Gabriel, there’s not this trust. I don’t want my kids to know how much I have, basically because you don’t trust them.
Gabriel Lewit: 20:38
Yeah.
Steve Lewit: 20:38
Uh you know, or I’m not I we have a lot of partners that don’t tell talk to each other about their finances. So, for example, the market goes down, you lose uh I had a client in during I remember this specifically in 2022 and the market tanked. You know, he came in and his wife was late and he and he says, Steve, uh, we lost about a hundred grand in our portfolio. Do not tell her. You know, so it’s a lack of communication and trust that upsets that unitary feeling, and bees don’t lose that, they just work through it all the time.
Gabriel Lewit: 21:12
Yeah, yeah, indeed. Well, last thing here is know when to sting. Okay, if you if you piss the bee off, yeah, you try to swat it and you miss, he’s gonna he’s gonna come after you. Yeah. Right? They can be a little protective. Uh so the the the lesson here is to be a little bit protective of your money. Maybe don’t go around stinging everybody, right? Don’t be uh, you know, miser or or the Scrooge McDuck, right? Who the guy trying to give a nickel to anybody.
Steve Lewit: 21:42
I’m trying to get on board with this one.
Gabriel Lewit: 21:44
This is a good one. The point is is be protective of your money. Be yeah. Okay. No pun intended to be protective.
Steve Lewit: 21:52
You mean don’t hurt people doing that?
Gabriel Lewit: 21:54
Like No, like you know, if your kids just ask, ask, ask and you just give, give, give. Maybe you have to say no. Um maybe you have to avoid you know, be you know, don’t spend as much, right? You have to tell yourself no, right? You’ve got to, you know, protect what you’ve what you’ve built and hoarded, right? The honey supply.
Steve Lewit: 22:14
So, because the result could be stinging.
Gabriel Lewit: 22:18
It’s just the idea just to pr protect your your money in various ways. I’m trying to deepen this idea. It’s not that deep. It’s just uh very surface level. I’m really trying here. All right. Yeah. Um, so so there you got it, folks. If you are thinking about and watching bees on National World Bee Day, right, then you know now you can think about some money lessons as you see them buzzing around because you heard them here.
Steve Lewit: 22:45
Okay. Yeah. Um do you ever look did you ever look inside a honeycomb? Sure. See them working in there.
Gabriel Lewit: 22:52
Yeah, they they’re doing something. I don’t know exactly what they’re doing, but they sure are moving around a lot. Oh my god.
Steve Lewit: 22:57
Yeah, it’s uh beehive.
Gabriel Lewit: 22:59
I would not want to be a beekeeper. That would not be my dream.
Steve Lewit: 23:03
Those people are amazing. They love bees, they just love them.
Gabriel Lewit: 23:06
Yeah, so uh other than there’s a movie called with Jason Statham called The Beekeeper, he goes around. Actually, funny enough, if you ever want to see a movie that has to do with financial scams and you don’t mind a little bit of like kicking, punching, violence kind of stuff, uh a great movie because what happens is he’s this beekeeper, and he’s of course a badass. He’s like this ex-Navy SEAL, no, like they’re like a secret society of like really dangerous, you know, like guys. But anyway, he’s retired and he has a neighbor that’s a super nice lady and she gets financially scammed. Older lady. Older lady, and she gets financially scammed, and he takes it really. She loses everything. And he gets really pissed off and he goes after him and uh and he gets all of her money back, which is great. Yeah, yeah, he does. It was a great movie. Good movie. Good movie to learn like what not to do with uh with financials. Not to be scammed because they show you the scam. They do, yeah.
Steve Lewit: 23:57
It’s actually very exactly how they do it, and it’s pretty interesting.
Gabriel Lewit: 24:01
Yeah, yeah. Uh didn’t mean mean to bring that up, but uh since we were talking about bees happened to happen to work out well. Yeah, okay. Well, if you’ve got questions on that, you of course uh call us uh on the money side, not the bee questions, because those I can’t answer too many for you, other than what we covered here today. Um call us here, 847-499-3330. If you’ve got any financial questions, you can email us info at sglfinancial.com. We have had a few listener questions trickle in over the last couple weeks. We’re gonna bring those back to you here on one of our upcoming shows. But to round out the rest of our talk for today, again, earlier this year we, I think in January talked about an annual financial planning calendar. Okay, the the concept of this, guys and gals, is one thing a month. If you can just do one thing a month with regards to your financial plan, and you do that consistently every month, by the end of the year you will have a well-rounded financial plan that’s in great shape.
Steve Lewit: 24:59
Yeah, so it’s uh it’s like cleaning your house. So, you don’t have to clean the whole house on the weekend. You can clean one room at a time, and then uh you know at the end of six months or ten months, you’ve got the whole house clean.
Gabriel Lewit: 25:12
Exactly. Yeah, one little step uh can go a long way towards the end result. So for May, and we actually have talked about some of these topics recently on previous episodes of the show, but we’re gonna give it just a little uh different angle here. But the the goal for May is emergency and liquidity planning. That which ties back to the reserves that we were talking about. It does with the B’s, right? Putting some money away, right? So, the goal here for May, uh we’re not gonna talk too much about where the cash should be or things of that nature, but the the goal here is to review, and you were bringing this up earlier, your emergency fund amount. Okay, do you have an emergency fund? How much is in it? How much should be in it? Well, as we had mentioned, uh anywhere from three months to six months to twelve months, depending on your personal preferences, but also how much of your income is variable, right? If it ebbs and flows a lot, if you’re uh uh a car salesman on commission, uh my my kids and I, we’ve been watching a uh a show called The Middle. It’s a great show with our with our kids, the families. It’s a good family show. What’s that about? It’s about a like a middle-class mid-America couple in the middle of the country in Indiana. Oh yeah, it’s really funny. Yeah, but anyway, uh the one of the female mothers, Frankie Heck, she’s uh car salesman for a number of years in the show, and she’s terrible at it because she can never make any sales. So, if you’re on variable commissions, they need a big reserve fund. Right, you gotta have a good reserve fund, right? Put a lot in the ebb and flow, okay?
Steve Lewit: 26:44
But so so look, Gabriel, look, there are all kinds of emergencies that can come up. Okay, one, you could lose a job, right? Now, the question, folks, you gotta ask yourself if you’re working, if I lose my job, how quickly can I get another job? So, what we find, for example, I have a client that’s uh very talented upper upper echelon executive, uh 56, 57 years old, got downsized, and guess what? He can’t find a job.
Gabriel Lewit: 27:12
Well, I’ve got a client I actually have a call with later today that the same thing uh can’t seem to find one right now.
Steve Lewit: 27:19
So so we have built a reserve fund just for that purpose. And that wasn’t in a savings account, it was in a more liquid, uh safe investment. But but you have to, I think you have to make a list and say what are the what what’s going on in my life and what could turn into a problem that’s not a problem. I have another client that uh their health is failing them, right? Now we don’t know if they’re gonna get better or not get better. So, this person is a sad story, you know, might live two months or might live three years or five years, but longevity isn’t in his calendar. You have to build a reserve fund for that. You have to make sure that that’s covered. Uh a child calls you and says, Mom, dad, uh uh we d we did a bad job of managing our money or running out of our money. Are you gonna l let that kid just suffer or are you gonna help him? You gotta protect your hive and just say sting them. So re emergency come in all sizes and flavors, and it’s good to just take an evaluation not only of if I lose my job, but about my health, about different situations in your family that could arise, and what you’re where are you going to get the funds from? So, part of the planning that we do, Gabriel, is always that we have enough liquidity in the portfolio to cover for emergencies. You got really fired up over this. Yeah, yeah. Because because people get caught short and then they’re in they they dig a hole from themselves and sometimes you can’t get out of it.
Gabriel Lewit: 29:00
Well, folks, it is very much important. So, uh Steve, thank you. That’s I I think great examples with clients here that you’ve seen firsthand. And uh part of our hope is that our firsthand experiences through other people will help to share some of these uh real life examples with you as our as our listeners. Now absolutely next uh next item on the emergency liquidity planning checklist, other than calculating and creating your emergency fund, is where is it held, right? At the very least, in in previous episodes, we’ve given a lot of cash options, but at the very least, make sure it’s in a high yield savings account. At least. Uh, but we also don’t want to risk having too much there because then you lose uh you lose money over time to inflation if it’s just in a checking account or even a even a high yield money market account can lose money to uh uh inflation over time. So, where we’re gonna then tie that into is separating your emergency cash from your extra cash, which we’ve talked about a little bit today on the show and in the past, right? You’re like if you had 200,000, you know, 100,000 could be emergency cash and the other hundred thousand could be extra cash reserves. That’s just a little bit more growth oriented to beat inflation over time.
Steve Lewit: 30:09
Yeah, so uh upgrading your kitchen is not an emergency. No. So you need a different fund for upgrading your kitchen than you do for emergencies. That’s what you’re saying, right, Gabriel?
Gabriel Lewit: 30:20
Yes. Yeah. Yes. Or even if you just thought you had two hundred thousand dollars that you needed, you probably really don’t need it immediately, depending on your budget, but most people wouldn’t. So, you could separate that into an emergency fund and a excess cash reserve fund. Or even if you had a hundred thousand, it could be fifty-fifty. If you had fifty thousand, it could be twenty-five-twenty-five. You get the the gist there. Um, you already talked about building a cash buffer in your income plan, right? If you’re a retiree, uh, we talk about different ways of creating safety, whether it’s or liquidity, whether it’s a spend me bucket, it could be a short-term bucket, it could be a cash reserve alternative bucket, uh, it could just be one year’s worth of cash in your aggressive stock portfolio. There’s a lot of different ways we can do this. Um, but that’s the idea here for May is review your cash, review where it’s at, review your emergency fund, review your spending, uh make sure you have enough liquidity, check your numbers, and that’s your homework for this month.
Steve Lewit: 31:19
Yeah, it’s giving it it’s giving thought to something that we don’t normally give a lot of thought to. Most people we meet, Gabriel, have a reserve fund, but that’s the end of the conversation. It doesn’t get broken down into little pieces that have meaning.
Gabriel Lewit: 31:36
Well, I just had a meeting recently with a client. I asked them how much do you have in cash, and she said, Oh, um, I don’t know, good question. Let me add this up. Yeah. Oh, wow, I have 300,000. Uh, you think that’s too much? So, so you know, that’s the point, is you know that’s a good problem to have, okay. But inventorying this stuff, right? You might determine if you have too much, too little, etc., and then we can game plan and strategize based on that.
Steve Lewit: 32:02
Inventory and give it a purpose.
Gabriel Lewit: 32:04
If you don’t have any clue what you have, you can’t really do anything about it. Amen. To that. Yes, indeed. All right, our friends. Well, we have uh absolutely been thrilled to have you join us here on our show today. Uh, we love chatting with you, even though we don’t hear from you, we just you hear from us, but we do love talking with you. It’s called a one-way chat. Um, Steve, thanks for all your endeavors and participations and you know, great comments today. You did a magnificent job, sir. Well, I have a great leader. So, well, we’re thinking of you. If you have questions, call us 847-499-3330 or email us info at sglfinancial.com or go to sglfinancial.com. Click contact us, and we can set up a time to talk complimentary anytime. Anytime. All right, everybody, have a wonderful rest of your day. Y’all be welcome. Tell you next time. See ya.
Announcer: 32:52
Thanks for listening to Our 2 Cents with Steve and Gabriel Lewit. For any questions about your finances, give SGL a call at 847-499-3330. Or visit us on the web at SGLfinancial.com and be sure to subscribe to join us on next week’s episode.
Disclosure: Investment advisory services are offered through SGL Financial LLC, an SEC Registered Investment Adviser. Insurance and other financial products are offered separately through individually licensed and appointed agents.
