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CHRIS PRATT: Today we have a special guest. He is a Dave Ramsey master financial coach. He is a podcaster, a public speaker, a world traveler and a retired firefighter. His name is Craig Luecke. Welcome to the show, Craig.

CRAIG LUECKE: What’s up, Chris?

CHRIS PRATT: How are you?

CRAIG LUECKE: How did you get such a cool name? Chris Pratt. You probably got the women lining up for your door like.

CHRIS PRATT: Some people would say I got really lucky with that name, others would say that I got really unlucky with that name if you’re familiar with SEO and marketing things like that. But I was just telling a guy that before guardians of the galaxy, nobody knew who he was. He was in Parks and Recreation and maybe a couple other little things, but nobody knew the name, Guardians of the Galaxy came out and everyone’s, you know, starting to say so. It hasn’t been my whole life that people have been calling me Chris Pratt. A lot of people ask me, were you named after him? I was like, he was eight years old when I was born or something like that. So I was not named after the actor. So the first thing we’ll get off that digit, the first thing I wanted to ask you,we talked a little bit before the show and you said that you were kind of a mixture between Dave Ramsey and Gary V. So for people who don’t know you, can you introduce your podcast Rock on the Money and what your style is and what the podcast is about?

CRAIG LUECKE: Okay, so I’ve been doing financial coaching unofficially for a long time. We’ve been doing this among firefighters. I’m a retired firefighter and we have our firefighters union back in the early 2000s. We decided it was something good for our members if we would have retirement seminars and teach our firefighter members how to prepare for retirement. Even though they have a pension, we still want to prepare them for retirement.

CRAIG LUECKE: So we have like a weekend where we could bring in the spouse and significant others and we would have all weekend for free, speakers from Social Security Administration, insurance agencies or 457 plan coordinator or T Rowe Price. We’ll have them come in and teach us all the things we need to do so they would be better prepared. That has been going on for a long time. And then, you know, 2008 – 2009, that whole thing started and people really started taking notice. No one takes notice of their finances until the market drops. Have you ever noticed that? It was like everybody cares about the money.

CHRIS PRATT: Yeah, right.

CRAIG LUECKE: Nobody cares about the money when it is doing good. So everyone finally got serious about it. And then we’ve been riding the wave up to 2020. And obviously, right now, when we’re recording this, we went through the Coronavirus and the market dumped again. None is bad as previous times, but it went down enough that now everyone cares about their money.

CHRIS PRATT: Oh yeah.

CRAIG LUECKE: Still, during that time, I found out that people when I would teach him what I’m doing, even though I’m a multimillionaire, that didn’t mean anything. People like, Oh, are you a financial advisor? Well, no, I’m not. So, people want to hear that you have some credibility, like Well, what training? Why should I listen to a firefighter, you know? So, I said, Look, I gotta get some certification somewhere. So Dave Ramsey, I’m a fan of Dave Ramsey, there are other financial people. He’s not the only one. So I went and took the course under Chris Hogan. Chris Hogan was the course I took, I got certified. So once I said I was a Master Financial Coach, even though nothing has really changed before I knew about Dave Ramsey. I had already been doing the baby steps. You know what he does basically, everyone’s got the same plan.

CHRIS PRATT: And that’s what we’re talking a little bit about earlier. Yeah.

CRAIG LUECKE: Right. It’s not rocket science, but it’s nice to have a plan. But now once I said, oh, Dave Ramsey, Master Financial Coach. Now people want to listen to me. So anyway, I’m also a fan of Gary V. I love his no nonsense. Come at it. Look, no excuses. So I mixed the financial thing with the Gary V in there a little bit of ah Clark Howard and there as well, you know, some more comments because I also worry about financial protections and consumer. I’m a big consumer advocate as well. So you take all three of these guys, you end up with my podcast Rock on the Money.

CHRIS PRATT: Awesome. I love it.

CRAIG LUECKE: We cover everything.

CHRIS PRATT: That’s awesome.

CRAIG LUECKE: Yeah, we cover everything. Our mantra is save, invest and protect. So save the money, which is the baby steps and invest it properly. Don’t go out for quick money all that crap and then protect everything like freezing your credit. Worry about using hardware keys for your password managers. We do the whole thing from A to Z.

CHRIS PRATT: Wow, that’s awesome. And I don’t know if you saw one of the videos, but in a couple of my videos, I’ve been pretty critical of Dave’s investing advice. So I love his saving advice and his debt advice. But his kind of investing advice, I think is I don’t know, it’s cookie cutter. It seems a little old, he doesn’t mention ETFs at all. What were your thoughts on that?

CRAIG LUECKE: Within our podcast, we still stick with the basic 15% when you get to baby step, for 15% and we don’t include company matches as part of the 15%.

CHRIS PRATT: Okay, so it’s your contribution, your real contribution?

CRAIG LUECKE: If there’s a company match or profit sharing it, that’s all icing on the cake. We do, do your part. If the company wants to throw a bunch of cash, that’s fine. But you gotta do your part. So what I do is, I still teach core growth stock mutual funds. I believe in investing in America. So I go full pedal to the metal. I love the index funds I teach the Core and Explore. You’ve heard of that. With the course, so we get everybody…

CHRIS PRATT: Yeah. I was just gonna say for those who maybe don’t know, could you explain a little bit about what the difference is between core funds and maybe growth and value funds.

CRAIG LUECKE: Oh, so here’s what we coach. Okay, and it goes pretty much close to what Dave Ramsey does. But the problem is, most 401K’s cannot do what Dave Ramsey has, which gives us kind of an out when we do the coaching. So if you take a standard 401 K plan,most 401K plans have an index fund in there. The S&P 500 index fund. We treat that as our core. If everybody could at least do the S&P 500 index fund and we teach them what it is, it’s amazing how many people have no idea what the S&P 500 is. So it’s America’s best companies. I won’t throw the market cap because they wouldn’t even understand that part. But look, it’s America’s best companies, you got Microsoft, Adobe, Apple, Amazon and peeps that’s something that people know. I try to relate it, bring it way down for most people. I’m finding out they don’t want to hear anything about, you know, technicalities or or market caps. They don’t care about that. They just want to know something that they’ve heard.

CHRIS PRATT: So your core, by core you mean that it’s the largest percentage of your investment.

CRAIG LUECKE: Absolutely. And you know what? You could do 100% of that and never touch it again. Just keep dumping your money in and check it in 30-40 years. But if you want to get more aggressive, and this is what we teach, do the “Core and Explore”. Then we start looking at the rest of the funds within the 401k. My thing is, if it can’t be a simple index fund, I don’t touch it. I completely ignore it. So I’ll take their whole entire list. I throw it in a simple, Yahoo or Google chart and just throw the comparisons on there and I look short term, long term.

CHRIS PRATT: Do you mean when people come to you with their own ideas or when you’re looking at other funds?

CRAIG LUECKE: Oh, Chris, you wouldn’t believe it. So I had someone come to me a week ago and ask me what to do and their financial advisor told them to do this, Chris. Did you ever just get one of these knuckleheads out there? I’m not a fan of financial advisors if you can tell. Someone comes along with whole life [insurance] and other things, we can talk about that later. They were literally in 17 mutual funds in their 401k.

 CHRIS PRATT:  Wow.

 CRAIG LUECKE: I was like, Who told you to do this? And they said, “well, our financial advisor and they’re paying somebody to do that”. What I have found out even with my 457 provider, where I worked in the county government and they told me privately how they do it. That’s what really triggered this whole thing. They know that most Americans get their quarterly statement in the mail, look at it, and if they made money, they put it in the box, that’s it. That’s all they care about. They don’t care how much they make or how much they could have. They just want, “did I make money or did I lose?”  And they throw it away. They know it’s filed. That’s all they care about. And they told me that. So what they do is they like to put you in 8 to 10 of these.

 CHRIS PRATT:  Who told you this? Who exactly told you this? 

 CRAIG LUECKE:  I don’t want to say what company. It was the representative to our county government for the 457 plan.

 CHRIS PRATT:  Was it a personal finance firm?  What type of company was it? Okay, so it was a government, Was it a government contracting company?

 CRAIG LUECKE: Which is to say, the government version for 401k. They put out for bids. So you have different companies. They bid to have all the clients, for them to make money off that they need to at least put you in half of their funds and then put you in the Vanguard. Some like that. So they’ll put you on Schwabs or the T. Rowe Prices and that sort of thing. That way, they can at least make money on that. Then they’ll put in some other things. So they made 8-10 funds, right? So that’s just about for me. I only like 3-4 at the most. I don’t think you need to be in anything like that. Like for generations Z, you’re in your twenties right? You should go full pedal to the metal growth stocks, 100%. Let that thing fly for 30-40 years. And when you get within that 10 year mark, it’s like, Oh, well, now we need to back it off a little bit. Then, I’m a fan of maybe a target date fund, something like that, that automatically starts slowing it down.

 CHRIS PRATT:  Okay.

 CRAIG LUECKE:  I don’t like target date funds until you within 10 years.

 CHRIS PRATT:  Okay. This is a lot of information. So let’s break it down. So what are your  main “Go To” investments for someone? Let’s say for Gen Z’ers or millennials who are younger and there were able to take on a riskier long term portfolio.

 CRAIG LUECKE:  Okay, so I keep it super simple. First, I get you in the SP 500 index fund. Okay? I don’t care if it’s Schwab, Fidelity or Vanguard. Usually a lot of these are at no cost whatsoever because they’re automated. There’s no fund manager.

 CHRIS PRATT:  Uh, yeah, yeah, it’s right.

 CRAIG LUECKE:  It’s the best you can do. And you got America’s best companies. And tech is at the top of them, with the credit cards. Then I look and see what other large cap growth you have in your 401k. Let’s take, for example, this one fund that a lot of people have been coming to me with, where I see it in their 401k. It’s a T. Rowe Price blue chip fund. That one consistently beats the S&P 500. So I say, look, my recommendation,  (I’m not an adviser. It’s a legal thing, how you do this). But if I were in your shoes, this is what I would do. I would put 50% in the S&P 500 then 50% on this other fund and let it ride. Considering it has consistently done well for generations. So I go back to 9/11,  2008-2009, how did they handle these differently? I just don’t look at part of the chart. You could make a chart look like whatever you want. But look what happened in the nineties and the different scenarios and how did they handle it? So yes.

 CHRIS PRATT:  And so one of the big things out there is the idea of diversification, right? They tell you you need to diversify. But I think when a lot of people here Oh, you only need to invest in 1,2,3 or even four funds, that’s not very diversified. So can you explain a little bit for people who may be to understand the S&P 500? On why investing in that one fund actually is diversification.

 CRAIG LUECKE:  I’m glad you asked this question because a lot of people throw that at me. Well, my financial advisors said I need to be in 8 or 10 funds to diversify. What I believe and I think you probably believe the same thing. I let the funds diversify. I don’t diversify my funds. Because and that’s the S&P 500 fund now, it doesn’t have all 500 companies in there. It has a good portion of it. You got five. Let’s say 450 companies on this fund, right? You have 400.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  How much more diversified do you want to be? 450 of America’s number one companies in there? What do you want, people? Do you want a big pot of stew, like that person has 17 mutual funds on top of that!

 CHRIS PRATT:  Okay. Exactly. There. 450 of the best companies. Yeah.

 CRAIG LUECKE:  That’s insane.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  You’re paying all kinds of fees. And when I looked at their 17 funds, by the way only one fund beat the S&P 500 index.

 CHRIS PRATT:  Wow.

 CRAIG LUECKE:  So I told them, just dump in there two. And they went back to their financial advisor and said, Hey I’m gonna, do this. What do you think? They said? You shouldn’t do that. You know why? Because he’s losing money, not the client.

 CHRIS PRATT:  Yeah. No, this is all great. So what about actively managed funds? I’ve heard a lot of discussion about actively managed funds in periods of recession. So right now we all know we have the Coronavirus pandemic going on. What do you think about switching to maybe actively managed funds? So you mentioned that these index funds don’t really have to be managed because they’re just tracking the largest companies in America. But in a recession, those companies all tend to lose value for a very short period of time, right? So, what do you recommend? Do you recommend staying in those passive funds or switching to an actively managed fund during a period of recession?

 CRAIG LUECKE:  We’re okay. So here’s where the Gary V starts coming on me. Well, it’s all on the mindset, I don’t care what happens 1,2, or 3 months of this year. I’m looking 20 years down the road and I know historically an index fund does 8 to 12% per year, on average. Long term, no matter what happens. Whether 9/11, Black Monday crash, it doesn’t matter. Over the long term these companies, because they’re America’s best companies and they do well over time.

 CHRIS PRATT: Yeah, I’ve looked into actually investing in other countries because the other countries, some other countries do have very good markets.

 CRAIG LUECKE:  I don’t have to worry about international index funds or international companies where governments are coming up and down or there’s turmoil or armies have taken over. I don’t have to worry about that crap. I just stay here in America because America rules! I mean, how could you not do that? You know? Absolutely.

 CHRIS PRATT:  The United Kingdom performs extremely well. Their version of the S&P 500 does very well. It’s very comparable. But even just investing internationally, I think there’s a lot of fees and costs associated with that, that will end up if you do try to invest nationally and will end up lowering your returns. I just wish we could get a better message out there about the fears that people have around investing. I know that when I started, I started investing in middle school. So when I was like, nine or 10 years old. Yeah, I had a music teacher in my middle school, who loved investing right, so completely unrelated to his field of practice. He was probably in his fifties or sixties at the time and he got us into this site called The Stock Market Game where it was paper trading, we’re not trading any real cash. 

And I just remember when I was in high school, I switched to trading with my own money, like real money. I was so worried about other countries beating us in terms of like, their returns and their performance because they say that like, Oh, well, if America does really poorly, then it’s going to recover later on. But I’m like, well what if it doesn’t? And, Dave Ramsey actually said something that’s true. I think it was a really good point, that if America is failing your US citizen in America, you have bigger problems to worry about than your 401k or your IRA, your individual tax to look out. So I thought that was a really good point and that gave me really a good piece of mind that if you’re investing in the best of what our country has to offer, then you are going to do well as long as the country does well. It also motivates you to care about your country and how your country is doing and how your country is performing. Not that you shouldn’t care about them about your country anyway, but it can give you some motivation when your money is tied in. And so we’ll move on, I guess, to a slightly different topic. How do you think we can help younger people understand the value of financial education? So maybe you could talk about over a period of a lifetime, if I don’t invest 20 years old what’s going to happen ? If I wait until I’m 25, what’s going to happen?  If I wait until I’m 35, what’s going to happen? Things like that.

 CRAIG LUECKE:  Here’s what I think, I think I was born in the wrong generation. I think I relate more to Millennials and Gen Z… Look what I’ve got going on on back here?

 CHRIS PRATT:  Awesome, I see Mario, R2D2, and a couple other figures, but the people on the podcast don’t see it.

 CRAIG LUECKE:  Wow! Good job. You can identify. I’ve been using computers and I’ve been online since ‘81, ‘82 which a lot of people had no idea. So I’ve been a geek from when you could actually buy a computer.

 CHRIS PRATT:  How much did a computer cost in 81, 82?

 CRAIG LUECKE:  Dude, I had to buy it from Radio Shack. It was a TRS 80. It cost me,  for simple colored computers, what they used to call it. It has 4K in memory by the way. That’s not megabytes, that’s K, I think it was $899. And you had to hook up to your computer.

 CHRIS PRATT:  Wow.

 CRAIG LUECKE:  But I learned how to program back in the 80’s. I built custom PC’s in the eighties but it’s not like my gaming computer that I have now with LED lights and all that. But I’m still a gamer, believe it or not. But back then, I mean, I  think I relate because I’ve been around technology for so long. And if I had known then what I know now, I would have a lot more money. We didn’t have the access to the information you do now that generation Z and Millennials or anybody. Like, when I had to go pick my mutual funds, my 457 even in the early 2000’s, we were still using pamphlets. I mean, they would come by and we put them all out on the kitchen tables and as we know that’s usually not correct information.

 CHRIS PRATT:  So you just have to rely on the information that was in the pamphlet.

 CRAIG LUECKE:  You can make a return look like any way that you want. As you know, that’s what we call financial vice or fake math. But it’s only legit, and a lot of people don’t understand that. But now I can throw my own charts up. So I mean having the education that younger generations have and we have calculators all over the place that you can just plug in your information. Here’s another thing. They’ve seen their parents. So right now we already know, you’ve heard Ramsey’s say this a million times. It’s general information. Seven out of ten Americans live paycheck to paycheck. That’s number one. Eight out of ten can’t even handle a $1000 emergency fund right now. Like an alternator goes out in the car, they have to charge that. Eight out of ten Americans. That’s insane. Most people have no retirement money. Trust me, I’m coaching a bunch of them right now, and they’re coming to me at age 50-60 which is like $20,000 in savings and they want to retire at 65.  I have to tell them unless you wanna live on social security, you can’t retire and they don’t want to accept that. They’re like, Well, I’m supposed to fix that. They need the time.

So, like your generation, Generation Z, you have time. So I have people I’m currently coaching in their young twenties. They are debt free. I think they get this from watching their parents. They see they’ve heard the arguments in the kitchen. You know, the bills. They’ve seen the pain. They’ve seen their parents lose their jobs. They see them buy these cars and boats and stuff. But then, we see that part. We see the cars out in the front driveway right when you’re driving out on the street. Remember, it’s eight out of ten of the houses around you if you look at 10 of them. But what the kids see is, they hear the arguments. They see the bills sitting  on their countertop. That’s what they see. And I think they’re learning from that and they’re learning that I don’t want to do that. I mean, we already know what Millennials don’t like buying houses. We know that right?  And why is that? Because they know their parents bought too much house. I believe it’s those kinds of things that they’re learning from and then they have the access to the information. They’ve all read it. I mean, all these different portions on the Internet read it and they’re hearing it like, Well if I just do that,  if I do this mutual fund then I could be a millionaire and it is so easy to be a millionaire. It is!  

 CHRIS PRATT:  And I think that’s a great point. I guess my question is, I think there’s a difference between the financial education and then the actual action to become financially successful. Right?  And I think there’s a big disconnect there. And obviously there’s also the issue of willingness to learn right. Just because the information is there and it’s free doesn’t mean people will actually listen to it. We’ll even hear or read or see. However, the content is presented, will they even consume that information. So one of the things I’ve …

 CRAIG LUECKE:  And don’t forget the social media factor in their instagram. People start seeing that all these fake influences run around there. They jump on some jet. They had nothing to do with that jet, but they make themselves look like they have the money. It’s all this fake crap going on. We all know about the influencers used in green screens to make them look like they’re in Italy or Paris. And then people want to replicate that like, Oh, why can’t I go buy Louis Vuitton? There’s so much fake going on out there, and people need to be self aware and not be part of that.

 CHRIS PRATT:  All right.

 CRAIG LUECKE:  And if you’re not part of that, you don’t care about what other people think. Then you can save and invest and look at your own self. And if you have a long term mindset, can you hear the Gary V coming in? But it is related, though, if you take the Dave Ramsey and you mixed Gary V in, it all makes sense. It’s just, can you get people convinced to do that, not care what other people think? That’s the key.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  Like you were saying, right? 

 CHRIS PRATT:  And part of it, I think, is a lack of hope because, you know, I have been very fortunate. I had scholarships in college, so I don’t have a student loan debt. I’ve gotten a great job out of college. I’ve done a lot for myself to create opportunity, right? I’ve spent a lot of days working so far in my life, as I’ve lived it. But I think a lot of people just don’t have hope because, you know, they see the things that I had. Like, I go to Penn State University, right? So someone who goes to a community College may see that, and they’ll say, Oh, well, I can’t be as financially successful as him because I didn’t go to as big of a school or as popular of a school. But when you really dig into it and look at the things that you have to do to become successful. Of course, income is maybe the biggest one right is having a higher income. But if you spend all your money, it doesn’t matter what your income is if you spend it all. All right, we hear about football players, professional football players making $10 million a year going broke. I think Adrian Peterson made $180 million or something and lost it all.  Michael Jackson, I don’t know if you know this. Michael Jackson was actually broke when he died because he was being sued so much and he had just a ton of debt from all of the things that he bought, right, Michael freaking Jackson. And nobody would think that. Yeah, and so I think at least for me that part of my goal and part of the challenge is how do you explain to people who don’t feel like they have enough opportunity or they don’t have even enough income, how do you get those people to realize that they can be financially successful? Or, I don’t know, maybe your opinion is that you don’t think they can?.

 CRAIG LUECKE:  Oh, no, they can. Anybody can. I know people, Okay, there’s a guy I need to go interview this guy. He’s a parking lot attendant in downtown Baltimore. I’m in the Washington DC area. He’s not far for me. They did an article about this guy. Go Google it. This guy has saved. It’s like $600,000. He just works in this parking lot. He doesn’t have an education.

 CHRIS PRATT:  What does he do in the parking lot?

 CRAIG LUECKE:  He’s the guy that collects your money so you can park there all day, and so the people and go to work. He helps you put your BMW in the parking lot. He just collects that and that’s all he does.

 CHRIS PRATT:  Uh huh.

 CRAIG LUECKE:  And he has saved. He’s his old guy now. He’s like 60 or something, but he has saved $600,000 in the bank. Now, I don’t know how he’s investing it. It could be literally in a savings account, which is a whole nother issue. But all it did was say that he has saved this money so he can retire and onall he does is to work on this stupid parking lot. He doesn’t own the parking lot. He’s the attendant. This guy didn’t go to college to park your car. You know that the idea that we have to have a Big Six figure income to be a millionaire is one those fictitious gnomes out there. Here’s what happens. You know this? Probably. I know of a number of guys that I work with as they got promoted in the far department, their salary kept going up. They get 10% increases, you know, and they automatically get raises of 5% every year. That sort of thing. As they got promoted, these guys would immediately go buy a Ford pickup truck. Brand new. So what happens is all these people that make more money, their lifestyle costs go up with it when that’s not what you should be doing. You should stay in the same lifestyle. Doesn’t mean you can’t treat yourself to an extra trip or something like that, but they bring up the cost of the budget with the income, and that means they’re not getting anywhere.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  I know. You’ve heard the phone calls they’ve made to Dave Ramsey making $203,000 and they’re in debt and they have nothing to show for it. And now they’re 50 years old, have nothing saved. That is inexcusable in America. This is the best country in the world to go out and make money and you can have a $50,000 salary and still become a millionaire as a Gen Z right now. If that’s all you did and you kept your costs low and you kept putting your money in the bank and you got into an index fund, you put that in the calculator. Go figure it out, guys. Or a Roth tax- free. You’ll be a millionaire at 60. It doesn’t mean you can retire early.

 CHRIS PRATT:  Okay.

 CRAIG LUECKE:  But compared to the generation I’m in, those sixty year old Sam aren’t retiring any time soon. You can retire in your fifties or sixties year and still retire a lot earlier than people my generation? No, the I and 1/2.

 CHRIS PRATT:  Yeah. As a matter of fact, I think for the average retirement age and some of the law is even changing to increase the retirement age. I’m not sure by how much. I don’t know but do IRAs have the age of that increase it all? I know it’s 59 ½  but I don’t know if that’s increased from where it’s been before. No, it hasn’t.

 CRAIG LUECKE:  No. The age is still 59 ½, but what they did is with the RMDs (required minimum distributions). That’s what they increased.

 CHRIS PRATT:  Okay, Right, Right.

 CRAIG LUECKE:  Make a little bit older. But that’s the people that do traditionals (IRA) they’re not doing the ROTH.  And I promote ROTH 100% all day long. People want to argue with me about that. Snipe. I just dismissed him. I don’t care.

 CHRIS PRATT:  Why do you promote ROTH? So, for those who don’t know, a traditional IRA is a retirement account.

 CRAIG LUECKE:  I don’t worry here.

 CHRIS PRATT:  All it does is it holds your money. So you can have that money basically in the bank in an IRA, you can have that money invested in stocks. You could do a self directed IRA where you’re buying real estate, your own real estate with that money. Now you can’t have self deals, you can’t live in it and what not. But you can do anything really with the money in an IRA as long as you’re not using it for your personal use until you withdraw it later on in life. And the benefit of that is that you have tax advantages, right? So with a traditional IRA, you put the money in pretax. So if you put in, I think the limit on a traditional IRA $6000 this year in 2020. So if you put in $6000 today and let’s say it grows to $10,000 in 10 years, I don’t know if that’s if that’s accurate, but it goes to $10,000 in 10 years. You are only taxed on the money after it comes out. So the advantage of that is that you’re putting more money in to start with versus a Roth, where you have to pay taxes before you put the money in. But the growth, right? So if your money went from 6,000 that $4000 that you made is not taxed in a Roth IRA, whereas it is in a traditional IRA. And I think that’s a pretty decent characterization.

 CHRIS PRATT:  So and I won’t go (too far). You can explain the next part of it where the difference between investing in a traditional IRA, and why it might be better to invest in an ROTH. I think I know what your reason is because it’s pretty obvious. But I’ll let you explain it.

 CRAIG LUECKE:  Yeah, it’s part of the long term mindset. This goes with the 401k because for 401k’s you do $19,500 in your 401k.

 CHRIS PRATT:  Uh huh.

 CRAIG LUECKE:  If you’re old like me, you could do 26,000.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  Either of that. So you have a Traditional and ROTH, so let’s say, like, right now I have a traditional 457 which sucks because I have a ton of I have multi seven figures sitting in there, but I gotta pay taxes on that when I start drawing it out. I plan on not touching this thing till I’m 70 and I’m 57. I know I could get probably two more doubles on this sucker, till I touched.

 CHRIS PRATT:  Uh, uh huh.

 CRAIG LUECKE:  That’s my plan. But anyway, so we didn’t have Roth available when I was younger, so it started up towards the end of my career. And by then the Roth amount is nice and big but let’s say I put $300,000 into this 457 and then turns into $1.2 million. Okay, I need to pay tax on $1.2 million at whatever tax bracket I end up in. So if I have to take, remember when you turn 70.5, you’re required by the government to start taking your money out. I have no choice. They’re gonna make me take out 3.8 something percent that could actually throw me into a higher tax bracket. So if I started 22% I could end up in a 28 or 30% tax bracket or whatever the numbers are because it’s grown so big, that’s right.

 CHRIS PRATT:  Yeah, I don’t know exactly here.

 CRAIG LUECKE:  Now let’s converse that let’s say I have a Roth. Yes, it came out after, I have paid taxes. I’m not lowering my annual income any because I’m paying taxes on it. That also grows to, let’s say it didn’t grow as much because it wasn’t big of a balance Okay, so I put it like it grew to like a million dollars. That million is now tax free. Federally. I don’t have to pay tax on that million. A lot of people think short term. They’re like, Well, I don’t want to jump in the next tax bracket. This is the commented argument people throw at me. Well, I don’t want to pay a higher tax right now, so I need to lower my tax income this year. So I need to do Traditional. Those people don’t understand what tax system we have in America. It’s a progressive tax system. So if I make it out say at 180,000 at the next bracket up or OK, so let’s say I make $190,000 and the tax bracket is $180,000.

 CHRIS PRATT:  Yeah, right.

 CRAIG LUECKE:  I only pay on the $10,000 in the higher tax bracket when jumped over. It’s a progressive tax system, but there’s a common thinking out there that I need to keep my total tax income below the tax lines. No, you only paid the higher bracket on what went over the line. It’s a progressive tax system, so your income should always grow. If you want to stay stagnant because you don’t want to pay higher taxes and do a Traditional, you’re just killing yourself on multiple levels, costing just more money. You should be making more money every year. Don’t you agree, Chris?

 CHRIS PRATT:  I mean, even if your income is just adjusted for inflation. Well, and the other big thing, I think, is that there’s obviously the mathematical numerical analysis of everything.

 CRAIG LUECKE:  You put it all in ROTH then it’s tax free. I can’t see any reason not to do that. What’s work? They were Yeah, You’re absolutely right, Brain.

 CHRIS PRATT:  But then there’s also the emotional behavioral analysis, and you’re going to put $6000 into your IRA either way, most likely right? And like you said, most people don’t even understand how much that $6000 is actually going to be taxed based on marginal progressive tax rates. So you’re going to be putting $6000 in either way. It might as well be in Roth because that money is going to grow way better than if you put in traditional and the limits are the same for both, and the limits apply to both. So if you put in 3000 into traditional, that’s $3000 that you can put into ROTH to grow tax free over the next 40 years. So I mean, I don’t like some of the tax calculators because they do show a pretty narrow difference of pretty narrow margin between Traditional and ROTH. But in reality, when people actually invest, it seems like that’s that’s not actually how it plays out where the difference is, only, you know, 5% between the two at the end of the day.

 CRAIG LUECKE:  They’re all these bloggers out there. They’re saying to do 50% ROTH, 50% Traditional. I try to keep everything simple. Index funds, Roth 100%. Just do that and go about your day. I don’t understand why people make this complicated. You know what? They make this complicated thinking now I have to go hire a financial advisor. You don’t need all that crap. Just keep it simple, guys.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  And I’m telling you, it works out mathematically, and it’s simple. It really is.

 CHRIS PRATT:  Here. Yeah.

 CRAIG LUECKE:  Yeah.

 CHRIS PRATT:  The last thing I wanted to talk about. You said you’re a millionaire. All right. Could you share a little bit of your story of how you became a millionaire, what your process was because you said you didn’t even know all of the things that you know now and you became a millionaire. So if you had known those things that who knows where you would have been, maybe you’d have been a trillionaire!

 CRAIG LUECKE:  Okay. Well, yeah, I would definitely have doubled what I have now. I was smoked by the Coronavirus. I came down a little bit, but it’s almost recovered already, so I’m actually doing well about that. But here, here’s another reason.

 CHRIS PRATT:  Hey, I’m sure I’m sure 99% of America would trade places with you. Even if you’re not a double digit millionaire.

 CRAIG LUECKE:  Well, do your best. Just leave it alone, people.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  All the people wind touched their 401ks. I don’t like the government giving permission for people to touch 401k’s. That’s a whole nother argument and that’s dangerous anyway. Just leave it alone people. So another reason why I do teach and coach people and I don’t charge for it. I’m kind of doing something anti -Dave, and I know we’re supposed to be charging for this, but I do the podcast with my co-host, Amanda, who’s a lawyer and a real estate agent. We coach and we do it all for free, we hope to be ad supported. Probably just like you and we’ll get our money that way. But we do it all for free because back when I started in the Fire Department, I was a rookie, came out of recruits school, got my first fire station and someone there, some of these old dogs popped a paper in front me and said, Here, sign this. I’m like, What is it? They said you’re going to get into this 457 plan, which is a government version of a 401k. I’m like, Well, what do I need that for? I’m gonna have a pension. They said rookie, sign it, They just told me to sign it. Well, I’m on probation. You do what the old dog says. So, all right? $50 a paycheck home. Get into stupid thing.

 CHRIS PRATT:  Probation as a firefighter.

 CRAIG LUECKE:  I’m a Firefighter. It’s a network for a county government with a pension. What do I care?. So they made me do it. I had no choice, or I probably would be doing dishes for the next month or two.

 CRAIG LUECKE:  So I signed this thing. I say I’ll just put 50 bucks in there to make him happy since back in 1987 by the way, So you start getting raises. I was like, I’m looking at my same like, Well, this thing isn’t growing very fast. I need to put more into it. No one told me to do this. I just got pissed off that I keep paying 50 bucks a paycheck twice a month in there and it’s not really doing anything. Ofcourse, we went through a financial downturn in the 89 by the way, and there was another one in the 90’s. I believe Black Monday happened.

 CHRIS PRATT:  Okay, ‘94, ‘95.

 CRAIG LUECKE:  I think it was in October of 89, I believe. That was a big downturn in our stock market. The worst in history.Anyway. So I said, I’m putting more in there. So every time I got a raise, I’m like, OK, I gotta raise, you know, I’m married. I got, you know, kids on the way, but I’m gonna keep putting more money in there. So instead of buying pickups like everybody else I started putting more every year. Every time I got a raise every time they readjusted our salary. You know, pay scales. I just kept putting more in there. And it started growing, it started one thousand then the five figures showed up. I’m like what you crossed over into 10,000. You’re like, OK, that’s kind of cool, you know? And then I said, I’m but even more in there, and I started more serious. I’m looking at the pamphlets. I’m starting to learn what’s going on with us, and then eventually I hit this six figure number when you hit that 100,000 mark, You think you’re Warren Buffet at that point. But to me, this is like in the nineties and remember back then, that was the tech boom. America Online was starting. Microsoft had been around, while Apple was kind of getting there trying to find their footing. All these companies were where the tech boom was going. But there were a lot of bad tech companies back then as well. We have a big, big tech bubble, but I was investing in. There were no index funds that I couldn’t even though it existed.  I was picking good funds. I was doing fairly well. W

 CHRIS PRATT:  Do you mean that the access was limited because of your plan? Or it was just limited in general at the time, right? Yeah.

 CRAIG LUECKE:  Whoever, whatever the plan was, what they said we could do.

So you just get the big list out and you pick the highest percentage. I mean, there’s no one teaching you anything what to do, like well, this 14%. I guess I’ll do that one.

 CHRIS PRATT:  Yeah, maybe.

 CRAIG LUECKE:  We didn’t know anything about dollar cost averaging. I just did it. Then 9/11 happened, and I was actually at 9/11. I was at the Pentagon, we were right down the street that day. I ended up being there. It was probably good. I hate to use that word. But it was probably fortunate that I was working at the Pentagon during 9/11 for 14 days because with my limited knowledge at that time, I probably would touch my account and pull my money out if you go back to 9/11 2001, the stock market did a rapid V. It just went down and went right back up. It was that quick and people did pull their money out and they learned a valuable lesson. You don’t touch your money.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  Well, I couldn’t because I’m working. I’m working at the Pentagon for a couple weeks.

 CHRIS PRATT:  And that’s such a horrible thing, right? Like, and I think it kind of relates to the Coronavirus today. We hear of hundreds of thousands of people potentially dying. If we had done nothing. Millions of people are dying. 9/11 You know, I was 2-3 years old. I was three years old when that happened, so I don’t have a recollection of it, but I imagine that it was a really scary time. And in one of the first things you want to do is yeah.

 CRAIG LUECKE:  I was in the middle of it.

 CHRIS PRATT:  Yeah.

 CRAIG LUECKE:  I wouldn’t work where they had the planes going in, but we had a plane going to the Pentagon here. And as our team is going into Washington, well, Pentagon’s not in Washington’s in Virginia, on the other side, the river, but as we’re driving in were the only people going in towards Washington, and it’s jammed up everybody trying to get all the government workers, everybody, and I remember looking at their faces in their cars, that look of fear. So they’re heading out and we’re heading in, and we didn’t know what we’re headed into because there’s still more planes out there. So if you weren’t around at that time in your generation you guys don’t know why unless you go back and look at videos. It’s hard to understand what we’re going through. You couldn’t get connected because of cell phone traffic. Cell phones were hard to get through because the capacity of the networks wasn’t quite up yet.

 CHRIS PRATT:  Okay.

 CRAIG LUECKE:  But it’s to stop the market.

 CHRIS PRATT:  I didn’t know that.

 CHRIS PRATT:  Yeah, I don’t want to speculate on what’s gonna happen, but that looks like that’s what’s happening with the Coronavirus right now is we have a pretty big V. Some people are saying it will be a W.  And these things are really sad and of course I think everyone wishes that they would never happen in the first place, But I think  it would be doing a disservice to yourself and to your family to make financial decisions based on an emotional reaction to the situations. Let’s say someone had maybe or maybe not a close family member, who died from the Coronavirus, right? And so they’re just having a very emotional response to a situation that’s happening. And they’re wanting to pull their money out because they’re just scared as heck. What would you say to someone like that if they came in and asked you for advice? Yeah, but not from the perspective of having to actually deal with the money.

 CRAIG LUECKE:  Yeah, I can’t remember who made this quote because Dave Ramsey keeps repeating it, but I posted it with our people in our group. It goes something like, um, people make dumb decisions when they’re scared and/or drunk.

 CRAIG LUECKE:  So when you’re scared, I can’t tell you how many people want to go do stuff for their 401k. We made a video, a live video for our group members the day before the stock market went down.  I said, guys, I’m telling you right now, stock markets going to go down now. I had no idea. What would you or we would still be down? I say it’s going to go down. But this is what I want you to do. Do nothing. You’re not gonna like it. And many of you, including your generation, have never seen this before. You weren’t around in 2007 to 2009. You don’t remember the pain that the parents, or maybe you do remember your parents having pain? Well, people’s lives, jobs were lost.

 CHRIS PRATT:  But not in the perspective of having to deal with the money.

 CRAIG LUECKE:  It was bad, but that’s caused by a financial crisis. This is something, I can’t even see this. This is what messes with my head because I travel around for work and I’m in all the empty hotels, the empty airports, empty planes in for a first responder who I’ve been going around. I was at the Oklahoma City bombing, 9/11 I have seen disasters all over the world. I can’t see this, and that’s what’s messed with my head. I’m like, Where did everybody go? But there’s nothing to look at. You know me. There’s no hurricane. There’s no earthquake. So this is messing with people who said they’re all sitting at home. They’re waiting to get back out. And so because they have this idle time and the Internet, all they hear is all the bad. I don’t watch cable news for a reason. I do white CNBC, but I don’t watch cable news because I find out it messes with my head. It gets into my financial decisions. So people see, oh, people losing jobs to now they start looking for their 401k and like man, I need to change. So they go on Facebook and ask Facebook for advice, which is the worst place you can go to. People like you took my money out my 401k and that everyone’s trying to time the market. I tell people, Don’t do that and it’s difficult. It really is, because people are scared out there.

 CHRIS PRATT:  Uh huh.

 CRAIG LUECKE:  Everyday, I tell my people, Don’t touch it. I make memes. I do everything I can come up with. I even have a megaphone. I tell people, How are you doing out here? I mean, I do everything I can.

 CHRIS PRATT:  If you can’t see him right now, he actually has a megaphone.

 CRAIG LUECKE:  Don’t touch it.

 CHRIS PRATT:  Yeah, exactly.

 CRAIG LUECKE:  But people are scared. And who are they going to trust, you? Chris? They’re gonna trust me? All they know is they see their money going away. It’s all they care for. And people actually think their funds can go to zero, which is not true. Like you said earlier, If your fund goes to Syria, you have bigger problems. We have like video game level. There are issues out there where people walk around with guns and we’re at [inaudible]…

 CHRIS PRATT:  We’re being invaded by Russia or something. Something very bad is happening. Yeah.

 CRAIG LUECKE:  I just want to tell people to not do anything. And it’s difficult, Chris. It really is.

CHRIS PRATT:  Yeah. Well, thank you so much. I guess the last thing I’ll say is thank you so much for your services as a firefighter. I’ll start with what you must have experienced during 9/11.  I can’t imagine what that must have been like. I’m one of those people. Every time you know, someone older mentions how airports used to be. I’m one of those people who just say I’m a younger person so I just go, what are you talking about? You know, you used to be able to just walk up to the gate and say goodbye to your family member. So this is a really sad time, but thank you so much for your services as a firefighter, Craig.

 CRAIG LUECKE:  I appreciate it, Chris.

 CHRIS PRATT:  You can find Craig, he has a new podcast, Rock on the Money on all major podcasting platforms. He has a website, rockonthemoney.com. Once again, thank you so much for coming on the show, Craig. Happy health. Good health and all the best wishes to you.

 CRAIG LUECKE:  And Chris, let me just say what you’re doing is amazing. I love what you’re doing.

 CHRIS PRATT:  I appreciate it.

 CRAIG LUECKE:  I love your podcasts. And what you’re doing is helping educate more so they don’t do stupid things. And then the more all of us can do, the better off everyone is going to be.

 CHRIS PRATT:  That’s the goal.

 CRAIG LUECKE:  So you’re doing a great job, Chris. I mean, it’s amazing.

 CHRIS PRATT:  I appreciate it. Thank you.

 CRAIG LUECKE:  Good job!

END TRANSCRIPT

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