Rebates for Home Improvements

Winter's high heating bills will soon be here, but did you know you can get money back for making your home more energy efficient? Hi, I'm Rob West.

It's true. New legislation passed this summer will give homeowners significant rebates and tax credits for energy-efficient home improvements. I'll talk about that first today, and then it's on to your calls at 800-525-7750.

That's 800-525-7000. This is MoneyWise Live, biblical wisdom for your financial journey. Okay, so this is all part of the massive inflation reduction act passed in August, and what home improvements have to do with curbing inflation? We don't know, but the act provides billions of dollars for homeowners who make improvements that save energy. The rebates and tax credits cover a range of improvements, from installing new electric appliances to beefing up your home's insulation in the attic and crawl spaces.

By making all the improvements listed in the legislation, you could receive up to $14,000 in rebates and tax credits, and up to a 30% rebate on the cost of installing solar panels. The aim behind all this is to make homes less reliable on fossil fuels for heating by getting homeowners to replace gas appliances for those which run on electricity, which of course is generated by fossil fuels, so whether it will actually reduce our dependence on coal and gas is up for debate. Proponents of the new legislation argue that local electric utilities are gradually moving to greener energy sources, and as they do, your electricity usage will become greener too.

What those greener energy sources might be, we can only speculate. At any rate, if you've been thinking about making any home improvements to lower your energy costs, this is a big incentive, and here are some examples. If your natural gas furnace is getting old, you could replace it with an electric heat pump and get a big rebate. Of course, heat pumps are more suitable in the south.

The further north you go, the less efficient they become, so they're definitely not for everybody. If you need a new water heater and the old one uses natural gas, you can get a rebate for swapping it out for an electric heater. Of course, you'll probably save money by installing any new appliance, simply because newer models tend to be more energy efficient. A new energy-friendly water heater alone could save you hundreds of dollars a year. You can also save a bundle by weather stripping and beefing up the insulation in your home, but now, thanks to this legislation, you can get a rebate for it.

Now, I wouldn't go out of the way to make these improvements, but again, if you've been thinking about doing one or more of them and budgeting for them, well, it's a great opportunity to save some money. Depending on your income, the legislation allows for up to $8,000 back for installing a heat pump, $1,750 for something called a heat pump water heater, nearly $850 for installing a new electric range and a heat pump clothes dryer. If you're thinking that adding all of these new appliances might put a severe strain on an older home's electric panel and wiring, well, you're right.

You can almost hear the breakers clicking off across America. So, the bill will give you up to $4,000 for upgrading your electrical panel and $2,500 for new wiring. But I can assure you, rewiring a house will cost a lot more than that. You can also get up to $1,600 back for sealing and insulating your ductwork. Now, I mentioned that the amount you get back depends on your income. If you make between 80 and 150% of the median income in your area, you can get back 50% of the cost of these improvements up to the $14,000 limit.

If your income is below 80% of your area's median income, you can get back the full cost of the improvements. Federal tax credits for installing residential solar panels have been in place for years, but the legislation boosts them from 26% of the cost to 30% and extends them until 2032. Tax credits for other energy-efficient improvements include $600 for new windows, $500 for doors, and $2,000 for heat pumps. It would be a good idea to consult a tax professional before making any expensive energy-reducing improvements to your home. You want to make sure you're eligible for credits, and if so, how much.

Rebates are a different story. That part of the legislation will be handled by states, so the details on how to apply for them will vary. You should check your state's website for more information, or contact your local electric utility. One last word about this legislation. Regardless of how you might feel about it, reducing energy costs by making your home more fuel-efficient is good stewardship.

And even without the rebates and tax credits, most of these improvements will pay for themselves in lower utility bills over the long run. All right, your calls are next. 800-525-7000. Stay with us. We'll be right back. All right, from energy credits and rebates to anything financial we go. What's your question today? We'd love to hear from you.

800-525-7000. This is MoneyWise Live, where we apply God's wisdom from the Bible to your financial decisions and choices. Whether you're dealing with your lifestyle, your spending plan, your giving to your church, or sacrificial giving beyond that, and doing that in an effective and creative way.

Or maybe it's your debt repayment or savings for the long term or short term. Whatever you're facing today, including your credit score, we'd love to tackle any and all of it. The number to call with our team standing by, in fact Clara waiting to receive your call today, is 800-525-7000. We've got some lines open and we'll look forward to taking your call.

We're going to begin today way up north, northern Alberta, Canada. Hey Ernie, thanks for calling. Go right ahead, sir. Hello. Thank you for taking my call. Whenever I get a chance, I always like to listen to your program and learn as much as I can. Well, thank you.

Beyond that, I'm self-employed and it's a sole proprietorship so it's not a limited company or nothing like that. I always struggle a little bit with getting a handle on things because it's just so much stuff going on. Small bills popping up and popping up and trying to get a handle on everything and it's just, I don't know, we signed up with the financial planner but I've been rather disappointed because it seems like he's talking more than he's listening and when you got questions and you don't get a satisfactory answer, it's kind of hard to establish that working relationship. Yes. Yeah.

Well, I certainly agree with you there. A good financial advisor would do a lot more listening than talking, especially at the beginning of the relationship but really throughout it because I think the key idea there is a word curiosity. As an advisor, I want to know what God's doing in your life, your values and priorities, where he's taking you and how money as a tool can support that and I want to be there to talk about the numbers but I also want to talk about much more than that in terms of what drives you and how we can really bring the very best thinking and tools and strategies to the table. Not to sell something or to drive my agenda as the advisor but really to help support you and your family and perhaps if that continues to be a recurring theme, Ernie, you might need to look for another advisor, somebody who really is going to take the time to get to know you and walk alongside you with whatever concerns you have both in the here and now as well as long-term investing and planning and even considerations about wealth transfer and everything in between.

So I would lean into that. With regard to the day-to-day, where are you feeling like you have the most breakdown? Is it just in controlling the flow of money in and out or is it something else? Well, it seems like there's many moving parts, right? Because as a construction company, that's what I do. I'm a carpenter and so when you have a general job, there's lots of in and outs and overall, it seems like there's so many moving parts. At the end of the month, you're always wondering where did the funds go that I invoice, right?

That's the hardest part. Yes. And do you have a clear delineation between the business and your personal finances where you're able to kind of put yourself on a recurring salary and then make distributions of profits periodically and then budget around that consistent income or are things more commingled? They're more commingled, yeah. I've actually wondered if I should maybe go limited where I would be as an employee for the company and just take a salary every month. I'm not sure how to navigate that.

Yeah. Well, regardless of the legal structure, I think the idea is you want to get yourself to a place where, and I realize you have to have regular cash flow and you've got to build up reserves in order to do this when you're a small sole proprietor that has ebbs and flows in the amount of business coming in. So I recognize this is easier said than done, but you want to get to a place where you have enough reserves in the way of the company's positioning that you can pay yourself that consistent income so that you have something to count on each month that you can base your lifestyle off of so that you can build a spending plan and a budget. And then during those lean months, you are pulling out of reserves and continuing to pay yourself a consistent amount. And when you have a big job and a payday, so to speak, you can build that back up. But your personal finances in terms of the monthly spending plan gets built around a more consistent amount. And that way it allows you to put a budget together that includes not only the fixed expenses, but the discretionary expenses so that you're building up your vacation fund and you're accruing for any estimated tax payments. You're planning for those semiannual insurance payments. So when those bills come due, the money's there. And I realize that sounds idealistic, but it can be a reality if you can live within your income and the business can operate that way. And then you get to the end of the year and you say, well, do we have profits to distribute?

And there's actually, at least in the U.S., the way our tax structure is, there's a benefit to taking the distributions versus the salaried income at that point. But it's all around a consistent and planned amount that you can build a spending plan around. And I think that's perhaps what you're missing is that this kind of varied income that you're receiving, you're just trying to constantly play catch up. And that can be frustrating and feel like you're not really making much progress. Do you feel like you could get to that place where there's more of a separation and a consistent income coming from the business to you personally?

Well, I think so. And that's the thing that I'm not sure in how to navigate getting to that point where it's more a clear paper trail, so to speak, on where things are at. That was the main reason we actually sought out a planner, somebody to try to help us walk through this.

And I'm on the lookout again. Yeah, it sounds like that's what you need. Somebody who can really help you on the bookkeeping side of the business, setting it up from an accounting standpoint, helping to smooth out what you're doing. But keeping that clear separation between the business and you personally and then paying yourself a consistent income with perhaps some distributions periodically as there's money available.

So I think that's your next step. Once you get to that place, Ernie, not only will it be clear for you to evaluate how the business is doing because you've got a clear set of books related to the business and there's not any personal expenses running through it, but you'll also be able to set up that budget. And that's where we'd love to help through the MoneyWise app. I'd be happy to give you a six month pro subscription where you can build your budget there using the envelope system, a digital expression of that. And that way, as the money comes in, you can automatically fund all of those envelopes.

And then as transactions come in against those amounts funded in each of those envelopes, then it reduces the amount. So at any point, you know, during the month, what do we have left in the eating out category? What do we have left in our miscellaneous and housing and all of these things?

So you can make decisions and course correct along the way. That's going to be key to you having margin so that you can use the excess at the end of the month to fund your primary goals and objectives. Is it building up an emergency reserve or paying down debt or saving for the future in a in a retirement account?

I mean, all of those things are going to happen when you can limit your lifestyle and have excess at the end of the month. So I would seek out that accountant or another planner who can help you get all that in place and then stay on the line. We'll get your information, get you a six month pro subscription of the Money Wise app. And our team would be happy to help you set up that budget on the personal side and get all of that working smoothly once you're ready to go. We appreciate your call today. God bless you, sir. Looks like we have two lines open.

Eight hundred five two five seven thousand. Give us a call right now here on Money Wise Live. We'll look forward to hearing from you. And we'll be right back. Well, it's great to have you with us today on Money Wise Live, where we apply the wisdom from the Bible to your financial decisions and choices.

The lines are full. We've got some great questions coming up, so sit back and enjoy. Hey, coming up in our final segment of the broadcast today, our friend Jerry Boyer stops by. Jerry is president of Boyer Research, a columnist at The Christian Post. And he joins us each Friday with a look back over the data, economically speaking, and the market actions for the week and also a look forward. We'll be interested to hear what Jerry has to say today as we talk about some strength in the market today.

After a week of selloffs, we had the Dow up one point two percent S&P close to that at one point three and the Nasdaq about the same. So green across the board today, but we'll get Jerry's thoughts on the Fed and much more. That's coming up a little later in the broadcast. All right. Back to the phones.

We go to Columbia, Tennessee. Hi, Trish. Thank you for calling. Go right ahead. Hey, Rob.

Thank you for having me on. Just a quick question. My employer is I work for a small organization and they wanted to do something kind for their employees that have been with them for three or more years. They wanted to set up an IRA and they actually would put in seven percent. And so since we got that passed through our board, we're having issues finding a financial institute that would accept that seven percent. I think it may have to do with the seven percent.

The difference between simple and traditional. And so I don't know. I don't know if you can point us in the right direction or maybe a financial group that would would help us because we just it seems to be a lot more difficult than we thought it was going to be. Yes.

You may have trouble with that. I mean, typically employers can either match their employee contributions dollar for dollar, but up to a three percent max of employee contributions is typically the way that that is done. In terms of the limit itself, the employee contribution limit is 14000 in 2022. And then if you're 50 or older, you can make a catch up provision of an additional 3000. But if they're matching dollar for dollar, it's a max of three percent with a simple IRA. And then the other option is just to do a contribution of each employee salary of two percent across the board. So if they opt for the matching contributions, it would again go up to only three percent.

So I think you may not be able to do unless I'm missing some other kind of provision here. You know, a seven percent match. You are talking about a simple IRA, correct? Well, we're just trying to figure out what type of IRA that they can give seven percent.

And if if there's one that if there's such thing and if not, they also would be fine with me setting up maybe a 529 for, you know, rather than the retirement fee for college savings fund. And then then write the seven percent directly in that account. So I won't have to pay taxes on it. We're just trying to avoid trying to avoid myself paying double tax taxes on the money because they want to give me the money to use. Yeah.

Yeah. The only way they're going to be able to do that on a tax deferred basis is going into a qualified plan. And so that means they either need to start a 401k, which, you know, that's not easy to do in terms of the paperwork and the administration and the annual cost with ERISA and so forth. But that's going to give you the most flexibility because, you know, that would allow them to do up to seven percent as long as you stay under the max contribution limits, which is twenty thousand five hundred for the year.

So you could do quite a bit more. But with a simple IRA, you're going to be limited to three percent with that annual max in dollars. And they're not going to be able to fund a 529 for you as a as a qualified option where there's no tax on it. They would have to just increase your salary, which would, of course, be taxable. Now, contributions to a 529 are after tax anyway, and then you get tax free growth on the money as long as it's used for qualified educational expenses. So they could increase your salary by seven percent. You would have taxes withheld and due on that amount. And then you could turn around and drop that into the 529, which again has to go in after tax anyway. Apart from that, I think probably the only other option would be that 401K that they would have to set up. How many employees do they have?

Six. OK, so that might be something to look at is whether they would want to create a 401K, which would give them a lot more flexibility in terms of the amount the amount that they could contribute. The simple is great just because by virtue of the name, it does describe how simple it is to set it up and maintain it. And that's why a lot of small businesses really like the simple IRA, just because they're easy to maintain and set up and there's not the filing fees and, you know, forced participation and that kind of thing. You have to have fewer than 100 employees and they're less onerous, like I say, than the 401K. So I might reach out to an advisor, maybe a certified kingdom advisor in your area just to see if there are any other options, perhaps someone who specializes in retirement plans.

But I think apart from the 401K, they're going to have trouble accomplishing what you're looking to accomplish, which is a seven percent match on a tax deferred basis. I don't think you're going to find an option for that. OK, thank you.

That's what I needed to know. I appreciate it, Rod. Thank you. All right, Trish, thanks for calling.

All the best to you. To Bradenton, Florida, WKZM, Tara, we're going to get to your call just around the corner. We've got to take a quick break, but I know you have some questions around debt that you have and perhaps whether you should use an old 401K to pay that off. When we come back, a lot of great questions lined up here as well, plus a few emails that we'll get to. Hey, before we take this break, let me remind you here in the last two months of the year, it's a great time to think about supporting this ministry. If you consider yourself a part of the MoneyWise family, we're listener supported, so we rely on your tax deductible contributions. You can give to MoneyWise Media quickly and safely online at MoneyWise.org.

Just click the Give button. We'll be right back after this break. Stay with us. We're delighted to have you with us today on MoneyWise Live, biblical wisdom for your financial decisions. We've got three lines open, 800-525-7000. Tara has been waiting patiently in beautiful Bradenton, Florida. Hi, Tara, how are you? Hi, thank you for taking my call.

You are welcome. Hey, tell us, did you all have a lot of damage after the storm there in Bradenton? A lot of trees.

Yeah, certainly not as bad as south of you. Well, we're still, those folks are in our prayers. I know that rebuilding is going to be significant for a long time, but grateful to have you on the program today.

How can I help you? I have a 401k from a previous employer, and I need to, they've been calling me about doing something with it, and so I do have some debt, and I've heard that a Roth IRA is always better, but I was wondering if I should just take it out and pay off my debt or leave it in there? Yeah, let's think through that. So what is the amount in that 401k, roughly? Oh, between four and five thousand dollars. Okay, and you're with a new employer now and contributing to a new 401k? They don't offer any 401k in my job right now, no. Okay, so are you doing anything on your own for retirement savings?

None at this time. Okay, and what is your age, if you don't mind me asking? I'm 38.

Okay, great. So you got a lot of time still to go. In terms of your debt, give me just a quick rundown of what you have. I have student loan debt and a credit card and a couple doctor bills. Okay, how much on student loans?

15,000. Alright, and credit cards? Not just recurring budgeted expenses that you're going to pay off, but debt you're carrying on credit cards? It's like 300 and something dollars. Okay, and how much do you owe on the doctor bills?

Oh, range from $50 to $600, I think, or $200 or something like that. Okay, so less than a thousand all in? Yeah. Okay, and then do you have any emergency savings? Anything liquid that you can fall back on? I have emergency savings, yes.

You do? Okay, this is my last question. How many months' worth of expenses would you say you have? I have my $1,000 emergency fund.

$1,000. Okay, good. Alright, well, you know, I would love for you to keep this 401k intact. Are you actively paying toward the student loans right now? Not currently, no. Okay, so they're deferred at the moment?

Yes. Okay, it's just going to, you know, it's going to add $5,000 to your taxable income for this year, so you're going to pay taxes on it, and you're going to have a penalty of 10%. So, it's expensive money, and especially with you not having any retirement savings, and this is probably down if you stayed invested. Now, if you moved to cash, it's probably not, but if it was in the stock market, it's probably down a good bit, and I'd rather you not, you know, sell out of that right now.

If anything, I'd roll it to an IRA and continue to contribute to it. In terms of the debt, you know, it's all going to come back to your spending plan, so you've got to have a defined budget and a plan during the month to control the flow of money in and out. The idea is to live within your means, so you have a little bit of margin left over, so we could first knock out that credit card debt of $300 and then build that emergency fund up.

Ideally, you'd have a minimum of three months expenses. And then, I'd really love for you, while you don't have access to a retirement plan, to keep funding either a traditional IRA, which would be, you know, the recipient of that $4,000 to $5,000 from your old 401k, or just leave that there, get it invested in maybe an index fund or something that's going to capture the broad moves of the market to allow you to kind of follow the recovery of the market when that happens, but start systematically contributing to a Roth IRA if you have the ability to do that. Now, I realize that means you're going to have to have enough income and limit your expenses such that, you know, once you start repaying the student loans, you're going to have to cover that debt service, I'd love for you to get on a track where that's going to be paid off in at least 10 years or less. And then beyond that, we need to knock out those doctor bills. But these are some prime compounding years for you, both with that 401k and then any new contributions you can make to the Roth IRA. Are you kind of living paycheck to paycheck at this point, or are you seeing any excess or margin at the end of the month typically? No, I'm paycheck to paycheck currently. Okay. Yeah.

Okay. So that means we've got to look for opportunities to get that income up or look for opportunities to decrease spending or both. But I think in the meantime, you know, because you only have $300 on the credit cards, let's make a just a real concerted effort to try to knock that out as soon as you can create that budget. I'd love to give you a six month subscription to the MoneyWise app and maybe you can create your spending plan in the app and use our digital envelope system to control the flow of money in and out so that you have at least 50 or $100 left over every month that you can knock out that credit card debt and then start working on the doctor bills, maybe get on a payment plan with them.

They should be willing to work with you. And then beyond that, then let's take that 50 or $100 a month that you free up if you can and start funding that emergency fund. But I'd leave that 401k where it is.

It's just going to be expensive money when you add up the taxes and the penalty. Does all that make sense though? Yes. Okay.

All right. Do you have any follow up questions? So you said something about stocks. So the question they've asked me was if I put my money somewhere, like where, you know, what would I want to put it in? And I just know the terms 401k, traditional IRA and then Roth. I don't know anything other than that. Yeah.

So those are the vehicles. So that's a tax deferred vehicle or retirement account that just has to do with the tax structure of the account. And then once you put money in or in the case of your 401k when you already have money in there, then you have to invest it. You actually have to pick the investments for the retirement account that you have.

And inside of 401k, the nice part is there's only a few options and at your age, you're going to want to look for the stock options, those things that have more heavily concentrated towards stocks. Or you could use what's called a target date fund where you would kind of pick your retirement date and choose a fund that matches that. So in your case, you'd probably pick a fund that's, you know, maybe 30 years out. So like a, you know, a 2050 fund, which means it targets the allocation of the investments, the mix between stocks and bonds. More aggressive when you're younger, more conservative when you're getting closer to 2050, which would be your potential anticipated retirement date. That'd be a real easy way for you to get in the market, get this money growing, especially now that it's down so that as it recovers, whether that's later this year or next year, you're going to benefit from the rise of that.

So I'd probably call your 401k administrator, see if they have a target date fund, pick the fund date that matches, you know, 30 years from now or so, and then that's going to be invested for you. And then you go to work on that budget, controlling the flow of money, trying to get your income up, trying to get your expenses down so you can free up a little bit every month to tackle the credit cards, then the emergency fund, then the doctor bills, and then ultimately the student loans. Does that all make sense? Yeah. Okay. Hey, if you need help along the way, let us know. We're going to get your information.

We're going to get you a six-month subscription to the MoneyWise app, and we've got team members that would walk alongside you in the process of you setting that spending plan up. And that will help you if you have questions, you need somebody to bounce ideas off of, we're going to be there for you at no cost to do all that for you. And if I can help you in any way along the way, don't hesitate to reach out. We appreciate your call today.

Hey, James, JP, Tara, Linda, Rose, we're coming your way. A lot more to come on MoneyWise Live as we apply the wisdom from the Bible to your financial decisions and choices. As stewards of God's resources, we want to be found faithful in managing God's money.

That means we have to live within our means and avoid debt and have some margin, set long-term goals, and live generously as well. We'll be right back. Stay with us. Thanks for joining us on MoneyWise Live.

I'm Rob West. Before we go back to the phones, it's Friday. Our friend Jerry Boyer stops by, president of Boyer Research, columnist at The Christian Post, and regular contributor to this program. Jerry, I know your voice is only about 60% as you recover from being a little under the weather. We're glad you're with us today. Good afternoon. I'm always happy to be here.

Thank you. All right, Jerry, before we jump into the markets and the economy, I mean, Elon's all over the headlines. Boy, he's got his hands full, doesn't he? This is going to be a business school case study and what it means to buy a company and all the challenges you have. Yeah, and I think in the long run, it's going to be a case study and what not to do. So I've kind of been of mixed feelings on this because as a citizen, I would like more free speech. I feel like Twitter was rather censorious. But from a business standpoint, I think it was a pretty bad decision.

I've been saying that all along for lots of reasons. One, Twitter is not a great company. It has business problems. So he bought something that's not that great. Two, he offered above market price when we were closer to the top of the bubble. And he got locked into that. So, you know, the markets went down 20, 30% by some standards when we're talking about tech companies.

So he was still stuck with that old tender offer, which was way above market at the time that he bought it. Two, he has a workforce that's not on board with him. So he's got a problem there.

And now three, you know, we have a situation where advertisers are starting to walk away. And the other problem is he became the richest man in the world on Tesla. Well, this is an enormous distraction from Tesla.

Tesla is the money cow. So every time it seemed like he was going to buy Twitter, Twitter shares went up and Tesla shares went down because it's a distraction. And I think one has to acknowledge he's almost a little addicted to Twitter himself.

So as a citizen and as a Twitter user myself, I'm happy that we're probably going to get more free speech. But from the investor and leadership standpoint, this is him wandering from his core competency and probably not a great thing for shareholders of Tesla, who I think have been hurt by this rather a lot. I think it's going to distract him. It's already destroyed a lot of his net worth. He can afford it. He's still going to eat steady.

He'll have a lot of hot meals every day. But, you know, this is it's a wealth destroyer for him and probably gets in the in the way of what his real mission is. So he didn't stay focused on colonizing Mars or electric cars.

He wandered off into the territory that's not his core competency. Perhaps there's something we can all learn from that. I was interested to hear your comments.

I got what I was hoping for. And I would tend to agree with you, but just a fascinating case study. We'll have to watch and see how it plays out. All right, Jerry, the markets green across the board today after a bit of a sell off last week on the heels of the Fed chairman's comments. What do you make of the meeting and where we're headed?

Well, what I make of the meeting is that people are confused. Why did the markets go down? You know, the Fed said we're going to raise interest rates, 75 basis points, which is just really a complicated way of saying they're a seller, not a buyer. I think I've mentioned to you before, the Fed is now the largest investor in the history of the world. So they're the largest single buyer or seller of investments. That's not their historic role. Their historic role is lender of last resort, not gigantic hedge fund.

So that's where they are now. So markets turn on what they think the Fed's going to do in the future. So the markets already baked in that they were going to raise rates three quarters of a percentage point. The market already baked in that the next hike was probably only going to be a half a percent. And that's what they did. They said three quarters of a percentage point is the current hike and we're probably going to do half a percent. So why would markets move at all if they just did what was expected?

Because the new information was that they said some things that indicated that they're going to stay tighter longer. They're going to be a seller of investments longer than was previously expected. So that means that the biggest investor in the world is a seller.

You don't want to fight that. So you're a seller, too. So that caused markets to go down because markets are all about the future.

They're not about the past. So then what happened today? Well, what happened today in our dual mandate, double minded central bank world, what happened today is the unemployment rate went up and the Fed thinks if unemployment goes too high, here's what you need to do. You need to cause inflation. That's what they actually believe that they need. They think that inflation is the way to fight unemployment.

Why do they think that? They think that the reason the economy slows down is because we don't spend enough and we don't demand enough. Now, we as Christians know that human nature has infinite demand. We don't need to have demand stimulated. But that's not what the new economics teaches. So the idea is we're going to punish savers with inflation to turn them into spenders. And that will get the economy going again. And that will get unemployment low. So today, when the unemployment numbers came out, the whole thing pivoted. This is the story that had been the story for the last week now switched.

And now it's the opposite story. The Fed's probably going to be a buyer. They're going to create new money and inject it into the system to fight unemployment. And that's why markets are so volatile, not because the economy is necessarily that volatile or because markets are inherently volatile, but because we have a Fed that can't make up its mind which mandate it's going to follow on any given day.

Yeah, that dual mandate leads to a roller coaster at the end of the day. Does any of this change your prospect over the medium term, Jerry, the next one to two years? No, because what's been going on over the past couple of months is kind of honing in a little bit on what's baked into the cake with markets is stagflation. So when you have an update today is saying the inflation is going to be a little worse than we thought, and the stag is going to be a little better.

Last week it was the opposite. Oh, they're going to fight inflation a little more. So the inflation might not be quite so bad, but the growth is going to be, you know, there's going to be a little bit less growth. So all of these like weekly switches in market performance, they're all within a certain range that's consistent with a basic story stagflation.

So in any given week, we might think, oh, it'll be a little bit less of a rough landing or maybe a little bit more of a rough landing. But markets are not acting like there's a soft lane. The markets are not acting like a boom is coming. The question is just how much of a slowdown the markets are not acting like inflation is beaten. The question is we're not no market, no market is indicating we're going to go back to normal. The question is, is it going to be 10 percent inflation or is it going to be eight or six percent inflation above normal? So nothing that's happened in months or really in the past year has changed the basic outlook in general terms, which is stagflation.

And why? And that's what I would have expected based on the policy. We have the same policies we have in the 1970s.

Human nature hasn't changed. So we're going to get the same. We're likely to get the same results we got in the 1970s. Yeah. And for the benefit of our listeners, stagflation, low growth, high inflation.

The question is how much of each. And that's going to drive ultimately market returns over the near term, the next one to two years. Well, Jerry, we always appreciate your insights, my friend. Big day next Tuesday. I'm sure you're expecting that the results will lead to more gridlock in Washington, which the market will probably like. The political futures market is pretty clear. Republicans take the Senate and the House and, you know, in gubernatorial, maybe pick up one or two gubernatorial seats.

So, again, skin in the game. Remember, I'm not usually predicting. I'm usually just saying, you know, in a multitude of counselors, there is safety.

So I look at markets because that's the highest number of counselors. And that's saying that we probably get something like a red wave. And, yes, that would be better for the economy. Divided government is better. I don't think it's hugely better.

It's more like a brake pedal on some of the bad stuff, not a gas pedal on good stuff. Yeah, very interesting. All right, Jerry, appreciate you stopping by, my friend. Enjoy your weekend. We'll talk to you next Friday. God bless. All right, Jerry Boyer, contributor and columnist at The Christian Post. He stops by each Friday with his market and economic analysis. All right, quickly back to the phone.

Beautiful Delray Beach, Florida. J.P., you've been waiting very patiently. Go right ahead. Thanks for taking my call. And I just really appreciate your what you do for all of us out here in America.

One quick question. I'm selling my house of over forty nine years. I'm trying to make a file for the buyer and for my tax accountant, because, you know, I have had great growth in the value of my house over forty nine years. I'm trying to make this file complete. So in forty nine years, I've had nine roots and I include all that in my file.

No, not necessarily. So you're going to want to get with your CPA or accountant and gather up all the improvements you made. So not routine maintenance, but they're going to be looking at things that improve the value, like finishing a basement, adding a room or a garage. You can also include improvements like upgrading the electrical system, adding a landscaping sprinkler system, not just replacement, though, of things that were already there. We're looking at the things that improved the value of the property because it wasn't there and you added it. All of that is going to increase your cost basis, which is going to reduce the overall capital gain.

You can exclude up to two hundred and fifty thousand for that number from that that number of gain or half a million if you're married filing jointly. And then you'd likely pay 15 percent on the rest. So when I built the house, there was no pool. I added a pool. Yes.

Then two years later, I added a deck of twenty five hundred square feet. Right. So that would be in addition to the house. All of those would be improvements that would improve the value of the house.

Yeah. So I would get with your because this is going to be an unusual year with you selling this property. I would use a CPA if you don't normally and they can go over all that.

But yeah, in terms of thinking of adding things that weren't there that stay with the house and improve the property value as a part of your overall deductions that you would take against those capital gains. We appreciate your call today very much. Tara, Linda, Rose, so sorry we didn't get to your calls, but we'd love to get you on the program, perhaps first on Monday. And we'll see if we can get your information and get back to you. We appreciate you calling into the program today, folks.

That's going to do it for us. So thankful to have you along with us today on the program. Let me say thanks to my team, Amy Rios, Clara Segar, Gabby T and Jim Henry serving us incredibly well today to make sure that we get you the answers you're looking for and help you navigate managing God's money and money. Managing God's money in a way that allows you to be faithful as a steward of his resources.

MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. Thanks for being along with us today. Have a wonderful weekend and we'll see you on Monday. God bless you. Bye bye.