NerdWallet's Smart Money Podcast - Renting vs. Buying a Home: Can HOA Fees Be Worth the Money?

Episode Date: September 28, 2026

Learn how condo and HOA fees change the math on renting vs. home ownership, and how to resist a pricey tech upgrade. Is buying a home with a hefty condo or HOA fee worth the money compared with renting? Hosts Sean Pyles, CFP®, and Elizabeth Ayoola talk with Ryan Sterling, CEO of NerdWallet Wealth Partners, about a listener trying to factor condo fees into the rent vs. buy decision. You’ll hear why the idea that renting is “throwing money away” overlooks the costs homeowners might not get back, how long it could take for buying to break even at different mortgage rates, and why the payoff of owning a home can be as much about emotions as finances. Then, how do you talk yourself out of a big purchase you don’t really need? Sean and Elizabeth weigh the pull of Apple’s new $2,000 folding phone and a high-end smartwatch, why monthly installment plans and phone leasing can make pricey tech feel cheaper than it is, and how to tell whether a splurge lines up with your values. Your financial decisions deserve a real partner. Learn more about NerdWallet Wealth Partners here:  https://nerdwalletwealthpartners.com/ Thinking of buying a property? Know the real cost first with NerdWallet’s Rent vs. Buy Calculator here: https://www.nerdwallet.com/mortgages/calculators/rent-vs-buy-calculator Enter for a chance to win a $250 Amazon gift card — and help us improve our show — by taking our listener survey! Find the survey and official sweepstakes rules here: https://docs.google.com/forms/d/e/1FAIpQLSettbeI0yDf8tLt_Q772StVJoWs_Gm-pWa-gSn2fdWEc0XcOw/viewform?usp=sharing&ouid=102666646608198254961  Subscribe to our podcast’s free email newsletter for bonus content and more from our hosts at https://smartmoney-nerdwallet.beehiiv.com/  Want us to review your budget? Fill out this form — completely anonymously if you want — and we might feature your budget in a future segment! https://docs.google.com/forms/d/e/1FAIpQLScK53yAufsc4v5UpghhVfxtk2MoyooHzlSIRBnRxUPl3hKBig/viewform?usp=header Smart Money’s YouTube Channel: https://youtube.com/@nerdwalletsmartmoney To send the Nerds your money questions, call or text the Nerd hotline at 901-730-6373 or email [e-mail]. Like what you hear? Please leave us a review and tell a friend. *The show notes were created with the assistance of AI. They have been reviewed by our editorial team for accuracy and quality. Learn more about your ad choices. Visit megaphone.fm/adchoices

Today's episode is brought to you by Vinted. Sean, do you have clothes in your trunk that you've worn but have no idea what to do with? You know what? I do not because my car is super clean right now. But I'm betting that you do, Elizabeth. I sure do, Sean, unfortunately. And I've been wondering what to do with these clothes. And then I found out about Vinted. So they're like this secondhand marketplace app and their mission is to make secondhand

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that's a great perk. Vinted makes listing items quick and simple, and once an item sells, Vinted creates a pre-paid shipping label for you, which takes out a lot of the burden of sending your items. See what's hiding in your closet, or like me, your trunk, and you might be surprised how much you can earn with Vented. Download the Vinted app for free to start listing with absolutely no seller fees. Hey, smart money listener. You could win a $250 Amazon gift card and help improve our show. We're inviting you to take our annual listener survey. It's shorter than last years and could bag you a sweet grand prize. We're giving away not one, but two, $250 Amazon gift cards. To participate, just visit nerdwollet.com slash pod survey or check out the link

in the show notes and submit the form by September 30th for a chance to win. Official rules are at nerdwollet.com slash pod survey. Good luck. Owning a home is still a core tenant of the American dream, but could renting be a better path to prosperity? Welcome to NerdWallets at Smart Money Podcast, where you send us your money questions and we answer them with the help of our genius nerds. I'm sure. Sean Piles. And I'm sorry to break it to you, Sean, but I'm the favorite co-host, Elizabeth Ayala. What? Says who? Says the audience. Vote, guys. I'm just kidding. Okay. Now we're in a competition here. Let's see who's the favorite. All right. Here's this episode's question. Hi, nerds. I was

wondering if you could touch on home ownership versus renting when the home purchased in question comes with a condo fee. None of the rent versus buy advice I've seen helps me understand how we should be thinking about condo fees in a place like New York. City. This time around, we are joined by Ryan Sterling, Wealth Advisor with NerdWallet Wealth Partners and affiliate of NerdWallet, Inc. Welcome back, Ryan. Thanks so much. Happy to be here. I know you talked a lot about the rent versus buy debate. So let's start by laying that out. On one side, some will say that renting is just throwing money away while owning a home is a definite path to building wealth. And then on the other side, folks might say that

renting gives you a lot of flexibility and who wants to deal with a money pit that is home ownership. anyway. So in your work, Ryan, how do you think about this debate? Yes to everything you just said. Great. The debate settled. It really depends. I would say that my baseline here is that I am pro homeownership, period, end of statements. However, homeownership is not necessarily the best way to prosperity, number one. Number two, it's not right for everyone. Number three is it very well might not be in best interest right now depending on where you are in your life. So it is a huge, it depends. But my baseline is, again, I think home ownership is a net, net positive for a lot of reasons. I think, again, though, it's not necessarily for everybody, especially at a certain point in time.

Ryan, how often do you find yourself telling your clients that home ownership maybe isn't the best path for them? All the time. And I will say that the nails on a chalkboard for me, is that phrase that Sean just used, and that is the, you're throwing away money with rent. Yes, but you throw away a lot of money owning a home, too. You have your property taxes. You have your maintenance. If the HVAC system goes out, like, you're not getting that money back. You know, roofs need to be repaired.

Owning a home is what I call a negative cost of carry. It is an asset, but it costs you money to own it. So another way to think about this too is that renting is the maximum amount you're going to pay in a month. You know exactly how much it's going to be. When you own a home, the mortgage and property taxes, that's the minimum you're going to pay a month. And at some months, you might not have to pay anything for maintenance. Some months, it could be tens of thousands of dollars. You don't know.

So again, you have to think about rents the maximum, the mortgage and property taxes is the minimum. However, I'll add, your mortgage is not. likely to go up year after year unless you have something like an adjustable rate mortgage. So I really like the idea of having a consistent monthly payment for your mortgage, barring any changes in property taxes that might happen for maybe 30 years. That's really appealing. Yeah, but maintenance costs usually go up with inflation. That's very true. And you aren't a homeowner, right? So I actually am now a homeowner. I wasn't for the long time. Yeah, I actually just bought a house. So I feel like, yes, exactly. I can talk about this from firsthand experience. And I will say that,

all of the advice that I've given clients over the years, I'm happy that I've given that advice because I am living it right now firsthand. And I can tell you that, you know, it's interesting that I run my own financial plan. And, Sean, what you said is it's a really good point in that plans tend to work better when home ownership is involved. And that is because of exactly just what you said in that if you have a fixed rate mortgage, 15, 30 years, at some point in those plan, those cash flows fall off. Where if it's assumed in the the plan that you're renting forever, you know, we know that rent's going to go up at some sort of inflation rates. So it is one of those things where it does start to cap your costs at a certain

point in time, even though certain other expenses of owning home do go up with inflation. It's not even remotely close, though. Like owning a home and having it paid off, like that is definitely a net positive as it relates to primarily kind of cash burn in retirement. So it definitely is a net positive. I would say for my own financial plan, it's been a net positive when I look at probability of success. However, it has been very expensive. It has come with a number of surprises. I knew there would be surprises and the surprises are presented themselves, but they still feel like surprises, even though I knew surprises were going to come. Right. You never know exactly what shape the surprise is going to take. Exactly. But it's going to show up. And I will say that in the short term,

at least, it hasn't been fun. Like there's something that's been nice about it, but it does now come with more headaches and more expenses compared to renting. So I don't regret doing it. I am also very glad that I came in with a very sobering view of it because it has been expensive. And you live in New York, and so it often makes sense to keep renting forever because buying is just so costly and unaffordable for many. Had you always wanted to buy eventually, or did you come around to the idea over time? So we actually, we bought our house outside of New York. And I was one of those people where I was fully prepared to rent indefinitely in New York and totally fine with that. And by the way, we have a number of clients who are in their 50s and 60s who are at financial independence. They've

accumulated net worth so well into the millions and they've never owned a property. So like I've seen a number of case studies where like it does work that you can reach financial independence and get to a very, very comfortable place without ever owning a property. And like for me, it's, it's interesting. Like the apartment that I lived in in New York, a couple of years ago, we were given the option to buy the apartment. And at first, we were kind of like, hey, we really like it. We, you know, we see ourselves staying for a while and, you know, it would be nice to own something. But when we started kind of digging into the cost, again, the whole idea of, like, you throw away money with rent.

Well, when I looked at the property taxes and the association dues, they were actually just as much as we were paying in rent. So I looked at this and I was like, wait a second, like, if I pay for it in cash, which I can't pay for it in cash, so I'm going to take on a mortgage, my monthly payment was going to double from buying, compared to renting. So we looked at this and we were like, you know what? Like, it just kind of makes sense to rent it. And I'm glad that we made the decision. Now, there's some life circumstances that have taken us out of the city, all for good reasons. And when we looked at kind of being outside the city, that's when the math started to math out a little bit more, where it's like, okay, like, should we rent a house? Should we buy a house? And when we looked at it, it's kind of a net net on a monthly basis to be pretty even. That said, running the full

financial plan, like owning the house just made more sense. And then, quite frankly, I just kind of wanted to be a homeowner. So, like, that played into it as well. There's something intangible about that. Yeah, it's really gratifying in some ways. I am glad that you mentioned the, like, monthly HOA fee or what's kind of the equivalent in buildings in New York, because that's really core to our listeners' question. And it can be quite a deal breaker for a lot of people. I was looking into buying a condo at one point. And it just made no sense to me to fork over so much money each month to an association that's going to be telling me what to do. with my property and I just it's a whole tangled web of complication and expense that I didn't want to

get stuck in but I do want to talk about how the financials come into play here nerd wallet has this really handy rent versus buy calculator we'll link to that in the show notes and it shows you when you might come out ahead buying instead of renting so I played with this a little bit in preparation for our conversation and I was surprised by how long it can take for buying to be the better investment so let me lay out some numbers here just for an example let's say rent is two thousand dollars month with a one month security deposit. And then let's say the alternative option is to buy a house that's $420,000, 10% down, a 30-year term, an interest rate of 6.8%, which when I was putting this together is kind of what we were seeing in the market. How long do you think it's going to

take to break even on this, Elizabeth? I'm just going to go with 30 years because there's a 30-year mortgage that most people get. Honestly, you're not that far off. It would take 24 years or almost the entire term of the mortgage to break even. Now, just to kind of play around, with this a little bit. I also put in an interest rate of 5.8%. And in that case, it would take just 11 years to break even, which really underscores how crucial interest rates are to this financial decision in terms of whether you're actually going to come out ahead with this investment. What people oftentimes miss are the frictional costs involved with owning a home. So you have to take an account when you buy a home, like there are closing costs associated with the home.

You've got to get an inspection, an appraisal. Again, the closing costs on top of that. And then if you turn around and sell a house, you're talking about all the expenses on the way out. The biggest one being if you use a realtor, those broker fees are like 6%. So, you know, again, like if you're buying a home, it's very expensive in terms of just a frictional costs, both going in and going out. So if you're only going to be in a place for a year or two, it is very hard to make that math work. So you really have to want to be in a place for a while. In the past, there's been guidance that if you're not going to stay in a home for, say, five years, it's not really worth buying, does that still hold up in our current market and interest rate environment?

Absolutely. And then, you know, another thing that I have to caution people and I was having this conversation with someone today is that, okay, so imagine you go from an apartment in New York City that's call it 700, 800, 800 square feet, and you go to a house that's 3,000 square feet. Guess what you also have to do. You have to furnish the house because you likely don't have the furniture to fill it up. And then what else happens? You're likely going to do something with the house. You're going to put in a fence. You're going to change the lighting. You're going to switch out some of the fixtures in the bathroom. You're going to do something with the cabinets. It's just highly unlikely that you're going to move into a house and not do anything to it.

So when you think about it, like you can't just think about the down payment and the closing costs. I would advise adding an additional 15 to pay maybe 20 percent to think about how much it's going to cost to furnish and any initial projects you're going to do. I think about all that we've done in the house that I live in in Portland. When we first moved in, the windows in our living room didn't open, which made it like basically a hotbox in the summer. And then we also didn't have like real heating or air conditioning in the house at all. And we didn't have insulation. So these were just basic things that aren't really cosmetic or make the house even prettier. But they were very expensive and they just made the house like functionally livable in a way that we needed in the 21st century. And so that's

just what we've been putting into the house as a baseline, but there's so much more we want to do just to actually make it look pretty, and we just haven't even been able to afford that yet. All right. Let's get back to our listener's question, guys. So we're talking about fees here, and it's so great that the listener is thinking about HOA fees and how they're going to get a return on their investment and whether it's worth it. So, Ryan, talk to us about how they should think about that HOA fee. So there's a couple different ways to think about it. And, you know, just how I mentioned, like, the nails on the chalkboard is you're throwing money with rent. Another kind of nails on the chalkboard moment for me is when people are like, oh, I don't want to buy a condo

because of the HOA fee. Like, I'd much rather own a house. It's like, okay, sure, you might not have an HOA fee owning the home, but guess what? You have to do the maintenance yourself. You have to do the upkeep yourself. When things happen around the exterior of the place, you are on the hook for it. Where that HOA or that association fee that you're paying in the apartment, they're covering a lot of those things for you.

So you do have to look to see, like, what am I getting for that? and don't assume that owning a home doesn't come with those costs because it does. I mentioned that to people before who've been reluctant to buy a condo and they're like, oh, actually that does kind of make sense because, again, if I own a home, like, I'm not going to want to do any of these things. So I'm going to want to get someone to do that. I'm going to need help with the exterior. I'm going to need help with mowing the lawn, whatever it may be.

So you do have to take that into account. So it's not necessarily a fee that is unique to owning apartments. just you don't have the same consistency with owning a home with it, but those expenses do prop up. So in a way, though, it's nice to have that consistency. I hear what you're saying. However, psychologically, I have a hard time with HOA fees because I'm not the one controlling when and how this money is getting used. And that kind of irks me personally. Also, too, and this has happened a lot recently, and that don't assume that the HOA fee is going to remain the same forever. And don't assume that.

that the Homeowners Association is well capitalized. So there have been a lot of instances over the last couple of years where homeowners associations have said, hey, by the way, everyone who owns an apartment here kicking an extra $20,000, $30,000 because we have some foundational work that needs to get done. I've had multiple clients where that's happened to them in the last couple of years because the HOA didn't have the money to do some of the foundational work that needed to be done. I know sometimes we go, okay, well, compare whether it's cheaper to have this HOA fee or take care of all these expenses on your own. But what is the way that someone can look at that? Is it going and researching? I don't know how much it costs to cut a grass

in a home and do all of these maintenance fees out of pocket? A general rule of thumb that I usually use, it's not perfect. So again, it's just kind of a general rule of thumb, is take 1% of the home price, maybe even 2%, but 1 to 2% of the home price is probably going to be your maintenance for a given year. So if you have a $500,000 home, I would assume in an average year, you're probably going to have somewhere between $5,000 to $10,000 of expenses on that home. And that's probably an average too, because I feel like with our house here in Portland, there have been some years where we have certainly paid $10,000-ish, and some years we pay much less. It's going to vary depending on whether you find that crack in your foundation or you decide to put new siding on your home that year.

That's right. You replace the roof and it's $25,000. You know, that's not something you have to do every year, but if you average it out, it probably comes out to being a $500,000 house, $5 to $10,000 a year if you average it over a five to 10 year period. And I also want to throw out there, sometimes you pay for convenience. Honestly, I have to get my own grass guy renting, and I hate it. I wish that someone else would take care of it because I hate having to do all the logistics of it myself. So sometimes you pay for convenience. Look, I spent over a decade in New York City, the idea that I'm mowing my own lawn is like laughable right now.

I've had to outsource that. Elizabeth, you have a growing son in your household. When I was growing up, that was my job. So maybe, I know I was a little young for this, but maybe sooner than later that could be his choice. No, he's not. He needs some more chores. I'm kidding. Honestly, let me tell y'all a little HOA horror story because I'm renting and I still have to deal with HOA.

And actually, I wish I knew who the person was who keeps driving by my house and sending my landlord's letters. If you're listening, side eye. But so the bush is in front of my house. house have been growing since I moved here two years ago. This is my first time renting a house or living in a house I've rented. So honestly, I don't know how short the trees are supposed to be. But right now, well, yesterday they were passing above my roof. So they took a picture and sent it to my landlord. And she's like, hey, can you get these taken care of? And because I'm cheap, I don't want to pay a landscaper to come be cutting this stuff. So I bought my own clippers. I took a chair from

inside my house and I cut off all those branches. And it was very laborious. But guess what? I saved myself $400. I feel like you as the renter shouldn't have to be responsible for the maintenance like that. I'm renting out my own property and that is my responsibility as the owner of the home. But hey, that's neither here nor there. But I want to focus a little more on the HOA question. So it's really key to our listeners question for us. So I was looking into how an HOA kind of factors in here. And NerdWall's calculator actually has a space for HOA fees. So I entered the median HOA fee in New York, which is a whopping $739 a month, according to Realtory.com. And by the way, that's about a little more than half than I pay for my own mortgage,

just for the HOA alone, which is bananas. So I did some calculations around how this would actually factor into the rent versus buy and which has you come out ahead. So considering that HOA fee, after 30 years, renting is still the cheaper option. You'll have spent around $76,000 on rent in that time compared to almost double or around $150,000 to buy. And that's in no small part because of that almost $740 a month HOA fee that you're paying. Bananas.

So that is why I will not be buying in New York City anytime soon. Look, I'm from the Midwest originally, and I would say a lot of our clients who live in New York are from places outside of New York. And, like, they go back to their family reunions, and people look at them like they have three heads because they're in their 40s and they don't own a home. And it's like one of those things, though, where it's like, that doesn't mean, though, you are being fine.

financially irresponsible, that doesn't mean you're not building wealth. And in many respects, like, these people are actually a lot farther along than most of their family. So, like, I've seen people across the country who have, like, taken all of their money out of their 401K, paid the penalty, paid the taxes to buy a home. That's, like, the worst financial decision that you could make. So I would say that, like, stocks are a positive cost of carry in that if I own a diversified investment portfolio, the dividends are paying me to own stocks. A home is that negative cost to carry where I have to pay to own it. So again, it's not necessarily the most efficient asset class.

I will also say, too, that people are very bad at doing internal rate of return calculations. So people come to me all the time and they say, my parents bought their house in 1992 for 200,000, and they just sold it for 800,000. And you're like, okay, like that alone is like a 3% compensation. annual rate of return, something along those lines. Okay, but like, did they put anything into the house? Well, yeah, so they redid the kitchen, the roof spin, replace. They did this. They did this.

They did this. Well, ask your parents how much they actually put into the home over the last school years. And the parents say, I know that because we were calculating how much we paid because we wanted to make sure that we got the capital gains exemption. We put in $350,000 of work into the house. So I'm like, all right, they bought it for $200,000. They put $350,000 into it.

So they're $550,000, and they sold her for $800,000. So that's been their return over close to a 40-year period. Like, that's not actually a very good return on invested capital. I love that you pointed that out, Ryan. It's so important because people do not know how to do the math, but thankfully, you're here to explain that it's, like you said, it's not always that you're in the positive after buying a home. And so many people talk about buying a home as a really smart investment, to your point, Ryan.

Like, it's almost equivalent to invest. in the stock market. And it's just such a different beast. It's like apples to willed a beast. It's such a different comparison. Well, we're going to take a quick break. When we come back, we'll talk about why buying a house can still be the right decision, even if you don't come out ahead financially. Stay with us. Ryan, some people are still going to choose to buy a house, even if they have a far out break-even point or they never come out ahead compared to renting. And that makes me think about the emotional side of buying because some people are buying a home because they just want to have somewhere to raise their kids or to have memories or even just to decorate. As a planner, how do you

navigate what's best for clients' personal goals versus what's best for their actual finances? I mean, look, not everything in life has to be a strictly ROI decision. I like to travel. And you could look and say, gosh, look how much money you spent on travel this year. Like, what's the ROI for that? It's like, well, gosh, I've got a life to live. You know, there's like a time value of experiences. So I look at this house that we just purchased. When I look at the long-term plan, like it does kind of math out again, because as Sean mentioned, the cost of monthly payments does go down significantly once you pay it off. But it's not like a crazy difference, to be honest with you. And so much of it is that like, I just kind of wanted to own a home. And I wanted

to feel like it was mine. I wanted to feel like I'm like some stability and like we're really part of the community. And the community that we're moving to, like everybody is the homeowner. Like, there weren't any rental options in terms of like where exactly we wanted to be. So in order to be where we wanted to be, we kind of had to buy. There's a lot of things that go into it that are strictly emotional that like, look, I'm an emotional being, right? I want to achieve financial independence. I want to make smart financial decisions. But I'll be the first to admit that like not everything that I spend money on is on an ROI basis. Buying our house was totally an emotional decision in terms of when we bought it. For those who were watching on YouTube or Spotify,

My dog Pepper just walked into the frame. And she has been lounging in the backyard. And part of why we bought our house when we did is because she is a dog that needs a yard. And so we accelerated our house hunt. And now she and Argus frolic in the yard all day long. And it brings me tremendous joy to see them out there. I actually, contrary to you two, do not have an emotional attachment to a home, which is probably why I'm not a homeowner. So I am not compelled by making memories.

I feel like I can make memories in any home, including the ones I'm renting. So maybe there will come a time in my life where I feel like there needs to be a childhood home. And I actually grew up in one. Me and my siblings grew up in a childhood home. My mom bought. And maybe I'm just, am I apathetic to this all? Because when she sold it, I didn't feel much of anything either. And that was like the house I grew up in.

And I was like, oh, well. So maybe it's just not for me. I don't know. Yeah. And you've moved around a lot. And it seems like you've been in your current place for a couple years now. But you might want to move again in a year or two, in part because now you have all these bushes to trim.

So who wants to do with that long time? I'm just. a girl. No thanks. Kind of bringing it full circle. Like you are living that flexibility and keeping your options open because you're renting. Like you don't want to be tied down right now, right? No, not right now. But that could change, you know? I'm with you. Like, I am not an overly sentimental person. Like, I don't get attached to things. Like, people mean a lot to me, but like, I've never been somebody like my childhood home when my parents sold it, like had zero impact on me whatsoever. There is an emotional kind of reason for buying this home. But like, if or whatever,

reason, like I had to sell it in the next couple of years. And if I lost money on it, which I would fully expect to, to be honest with you, because of all the transaction fees, I wouldn't regret it number one and number two, though. Like, I don't feel like that over connection to it. The primary motivation is to be in the area that we wanted to be in. And that was like kind of like fully it. But again, I will say like there is something that was kind of like nice going through the experience of it all. And there's something that, you know, again, I've been advising on it for so long, I would say that there's almost kind of like me just kind of running an experiment on my own to be like, just making sure that the advice I've been giving is the right advice. And by the way, it is solidly the right

advice. Good to hear. That's reassuring. Ryan, one thing I'm thinking about is what people could do with all the money they're not spending on a home if they're just renting. We talked about earlier how much more affordable renting can be and how much more money you could have in your pocket on maybe a monthly or annual basis. How do you talk with your clients about what to do with that money they're not spending on a home, whether that should be put toward investing or maybe a certain kind of savings account. What are your thoughts there? Let me just kind of use myself as an example. Saving $4,000 a month on renting versus owning a home meant I had $4,000 extra a month that I could put towards an investment account. That's a meaningful. So I'd say for most people, again,

if you can afford the monthly payment on buying the home, but you choose not to do it, and you go with renting because it's a less expensive option, invest that difference. And again, anything can happen. But I would say over a 10-year period, it's highly likely that your wealth is actually going to grow faster in that extreme case than buying the home. This is New York City. In New York City, I think, has way more extreme cases of the buying versus renting decision. But I would say for a lot of our clients who live in New York or even San Francisco, I would say like when we do factor in that Delta and then we take that money and then we put it into a diversified investment account. It has very similar impact, if not a more pronounced impact, than buying the home.

Well, thank you for telling me, Ryan, that what I'm doing is right. So thank you very much. You're doing the right thing. Yes. I'm just investing more. And I like not having any other fees. Yes, my rent could go up, but thank you to my landlord for not putting it up. But I just like being able to just throw money in the stock market and not have to worry about

anything else. That's right. And Sean, you also did the right thing, too. Yes. Yeah. Thank you. Yeah, I mean, I feel like I really did the right thing because I bought a house in 2020. So grateful for that low mortgage rate.

With the delicious interest rate. Yeah. Yeah. Okay. But that's where it goes back to the very beginning of this is like, who's right? Both are right. It really depends. And that's where, again, like, you do need to put it through a financial plan.

Well, if someone is debating renting versus buying and they're really not sure what's going to be the best for them, what would you recommend they do to come to some kind of decision to. to sort that out for themselves. I think having a financial plan done and being able to look to see, hey, like, let's look at these different scenarios. Like, number one, like on my current trajectory of renting and assuming that rent is going to go up with inflation, like, if I never buy a home, like, does the math, math out? And for a lot of people, you'd be surprised, like, it actually probably does. So I'd say, like, number one, it goes back to, like, having a financial plan and being able to look at the numbers. And again, like, I will say, like, I have so many different case studies in terms of clients where, like, they've reached financial independence and have

accumulated significant wealth without ever owning a home. Great. Well, Ryan Sterling, wealth advisor with NerdWallet Wealth Partners. Thank you so much for joining us today. Yeah, thanks for having me. If folks want to learn more about NerdWalt Wealth Partners, check out the link in the episode description. Elizabeth, now that it's just you and me, I got to confess something. I need your help. I need you to be my accountability partner because I got kind of brainwashed by consumerism recently. I need you to talk me off the edge of making a big purchase. Do you want me to be nice or mean about it, Sean? Okay, I'll be nice, I'm nice.

I'll be in the middle. It can be good cop and bad cop. Okay, so I don't know if you know this, but Apple recently announced their whole new slew of gadgets that they do every fall. And I got really interested in their stupid fancy folding phone. Have you seen this? I know. No, no. I just literally yesterday with my boyfriend, he showed me the phone and he was going through all the features.

It tries to do everything. Sean, no, I need to hear about why you go for the track. It's not just that. It's not that because I also was thinking about, like, they have the Apple Watch Ultra, which is like super rugged. You know, I'm always running around mountains and stuff. I'm like, maybe I need this fancy watch too. I don't know if you saw the price of these devices. I know. Need or want, Sean. Need or want. Well, that's core of the question here. Fundamentally, I don't need them.

I would like to have them because they're shiny. But the costs are really getting to me. I don't know if you know this. the base minimum cost for that folding phone is $2,000. Okay, time to end the recording. There's nothing to talk about because why are you buying a $2,000 phone, Sean? Okay, I'm being judgy. I'm being judgy. If you do it, so they can break it up into installments over 24 months.

And it's like almost $90. It's like $80 to $90 each month. That's how they get you. It's like buy now, pay later. having a shiny screen. And then the Apple Watch that I'm looking at is like almost $800, I want to say. So again, just to have a shiny thing on my wrist. And guess what? I actually already have one that's not so fancy. But it does track my workouts, but the battery is like not as cool or fun or long lasting. So as I've been laying this out for you, I'm kind of talking myself out of it. But I find that the more I look at like the images online, the more I'm susceptible to the marketing. And I feel like such a lab rat or I'm like, oh, everything they're doing, all of the meeting,

they had internally at Apple to make these products seem really tempting are working on me. And I hate that. They're working. So please talk me off the edge here. Sean, oh my God. I'm not going to lie, though, not going to lie. The second half of the commercial advertising the phone, it did make me go a little bit because the camera features were great. I was like, okay, and you know I love me a good selfie. But Sean, okay, so first of all, which one are you more drawn towards? The phone or to watch? The phone a little more, but I am talking myself back from that because of just the price tag alone is so outrageous. The watch feels more practical, but the phone just looks so fun and nice, and I'm so bored of my phone. And I also, like,

resent my phone deeply because it has such a tight grip on my life that, like, why do I want to spend more money on this, like, even fancier grip on my life? So. Thank you for saying that, because as I watched that commercial again or whatever it was with all of those features, what came to mind is that they're just adding more and more features to keep us on our phones. And you know how I feel about that. I want to lean more towards the watch. And my reason is to saying maybe yes. Not yes. Maybe yes to the watch. Not that it's my money. But I got so giddy when you were like, I thought you were going to say I could buy the watch. And I got so excited. So I'll let you finish. I'll let you finish. I'm not going to completely oppose the watch because I would be a hypocrite. My

birthday's coming up and I buy myself very expensive birthday gifts. But I but, you know, I, I deserve them. And I do. And I budget for it and I don't feel bad after I buy them. So I think it supports this watch, your wellness journey one. And, and like we said with Ryan, not everything has to have an R-O-Y. And sometimes you just buy things because they bring you joy and sometimes they're a little expensive, right? But I do think you would get a lot of use out of your watch. You don't necessarily have to be addicted to your watch, although I know that they put all the annoying functions of your phone on your watch. But I know.

I have my notifications turned off, so I'd barely get anything besides just like actual watch and workout tracking functioning. Amazing. Amazing. So I actually don't have a hell no foot of watch, okay? I would say if it fits in your budget and I know you're a stickler about, you know, making sure you're budgeting and saving and sinking funds. Yes.

And you know what else, Sean? You're not going to get me with this. You get to pay $90 a month. No. Where is your sinking fund for the phone, Sean? So if you decide that you're right. that you want to do this $2,000 phone, I think that you should do a sinking fund

versus tying yourself to a contract. Yeah. Yeah. What I also really admire in terms of like their evil genius at Apple is that not only do they have this like you can pay it off over 24 months, they have a new leasing program like you're leasing a car and it's less expensive. And the idea is that you can afford this phone more easily. And then after a certain amount of time,

you'll just upgrade to the next one. And then you perpetually have a phone payment. And that and scrolling. Your whole life is being sucked away by scrolling and Apple. Let me tell you a funny little story of how defined I am. I have Apple products, by the way, so I like them. I see the Apple Watch on your wrist right now. Exactly.

But it's cracked and I'm going to ride it to the wheels fall off. Yeah. I'm not replacing it. But I'm so defiant about giving Apple any more of my money that my storage has been full for years. And I refuse to go from the 99 cents to the 10. 99 a month and everyone gets annoyed with me because I'm consistently deleting photos at every function in videos because I ain't got no more storage. But I'm not giving them any more money.

Okay. But those are my value, Sean. Yeah. That is it. It's your values. And so that's something I've been trying to talk myself into as well. When I'm no longer hypnotized by the shiny commercial that I've just seen, I'm like back on my own sitting with my own phone that I've had like two and a half years or so. And I'm trying to think about what I really want my money to be directed towards and I've been reading more about how our phones are created and how they're acquiring the minerals for them or even doing the R&D for these products

and it's like often in really shady ways like there's a whole war going on in the Congo just to my minerals for our phones and that doesn't feel good when I'm thinking about throwing $2,000 at that. I also think about this really distinct moment. You know how like in German they have a word for like every crazy

specific situation that happens where it's like they just mush all these words together? I want a word for the novel experience of when you get a new iPhone and it has the same exact information as your old iPhone and you're so disappointed. You're like, wait, I just paid how much just to have the same exact experience on this screen too. It's just, it's a very specific disappointment. And I also feel kind of like a fool where I spent how much just to have this shiny screen. But that's why bringing it back full circle to the buying it again. The new folding phone is different because it folds and now there are two

screens on it. So that's kind of exciting. Again, I'm not the girl who's going to say, yes, of course, on this show, we say that, you know, you could save or invest and compound interest. That's not the point of this, right? Because we're already saving and investing and you get to enjoy some of your money. But, you know, I just want to make sure, Sean, that if you do buy this phone, I'm not going to shame you if you do. Thank you. That you really, judgment free zone, that you really get joy out of it. And, again, I just do not like the $90 a month thing because then it tricks your mind into thinking that it's not expensive as it is.

is a lot of money for a phone. $90 a month is really expensive. It's so wild. I could do so much with that money. You could. You could do another run around the mountain. I don't know. And buy more shoes for another run.

I don't know. You're so right. I could do that. So maybe I'm leaning toward the watch. That's what I'm thinking. But thank you for talking me off the edge a little bit because I was about to spend too much money. Not that I was going to buy both.

But if I did, that'd be like basically $3,000 just for shiny screens that I don't need more of in my life. Yeah. And if anything, as we always talk about, you get to pause, right, and think about it versus impulse buying it. And you might still get the phone. Who knows what the future holds. But at least you gave yourself time to think about it and you're making sure it's a good decision for you. So. Thank you. I'll try to be informed. And if I do end up buying it, I'm probably going to have to talk to at least one more time before I do that just to really get your thoughts because I appreciate your insight, Elizabeth. If you buy it, I got to see it. At least let me secondhand experience it, you know, and we have to take self-finding. he's on the phone and all the other things. I know, yeah. I'll have an incredible time playing duolingo to learn Spanish and scrolling for Instagram

on my fancy fancy phone. Terrible. Where's my brick? Okay. I know. Cool. Well, thank you, Elizabeth. I think that's all we've got for this episode.

So, folks, you know the deal. Send us your money questions because this show runs on them. You can call us or text us on a nerd hotline at 901-730-6373. That's 901-730 nerd. You can also shoot us an email at podcast at nerdwallot.com. Join us next time to hear about how to give yourself a forever paycheck in retirement. Until then, follow Smart Money on your favorite podcast app. That's Spotify, Apple Podcasts, and IHeartRadio to automatically download new episodes.

We're on YouTube. Yes, we're going to keep saying it until you're completely annoyed and you go to our YouTube channel and watch the videos and follow us. Thank you very much. Here's our brief disclaimer. We are not your financial or investment advisors. This nerdy info is provided for general educational and entertainment. purposes and may not apply to your specific circumstances. Some companies mentioned in this episode may be nerd wallet partners, but that does not influence

how we talk about them. And until next time, turn to the nerds. Okay, that was too much. Turn to the nerds. I love your singing voice, Elizabeth. Never too much. I want more. Thank you.