25 Scary Money Stats You Need to Know! (2025 Edition)

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24:38Okay. Try it for yourself. Starbucks refreshers concentrates are coming home. Find them in the coffee aisle and make it yours. All right, number 13, and we are going to get into some fun stuff here as well. The average car payment for new vehicles is$734 per month. Now, when it comes to new vehicles, my friends, there's a number of different things I want you to know. Number one is the moment you drive a new vehicle off the lot, it loses 10 to 20 % of its value. So brand new vehicles are typically not the route I like to go. In fact, I've never driven a new car in my entire life. And I buy vehicles in a very different way.

25:15Let me explain how I buy vehicles. Typically, I'll buy them one to three years used. And I say one to three years because my vehicle that I'm currently driving, I found such a good deal on it being one year used. that I bought it. But typically, I look for one to three years to use because they take a big depreciation hit. Usually in the first couple of years, they depreciate 25 to 30%. And so because of that, I can find a vehicle that is pretty much in the same condition as it was new, but it already took the depreciation hit. So I'm buying into it when the value reduction already happens. The person who bought it new is the one losing the most money because vehicles are depreciating assets.

25:51And so over time, they go down in value. And so I follow something called the 24-12-10 rule, okay? 20 % down is what I like to put down on my vehicles. Why? Because if your vehicle appreciates 20%, when you drive it off the lot, then guess what? If you get in an accident a couple of days after you buy that brand new shiny car, then you're underwater on that car and you're gonna have to pay out of pocket if you get in an accident or you total that vehicle. Two, I want your payments to be four years or less. Why? Because I don't want you having car payments your entire life. We're trying to avoid that at all costs, four years or less on those payments, okay?

26:2512, what does 12 stand for? 12 should be how much you're spending on your car payment and how much you're spending on maintenance. So here's what happened to me and why this number exists. A while ago, my wife and I bought a vehicle that we no longer have, and there's a lot of reasons why. A luxury vehicle that rhymes with Schmercedes. And when we bought this vehicle, all of a sudden, we realized very quickly the maintenance on this vehicle is just absolutely crazy. And so oil changes every single year were$2 ,000 to$3 ,000 just to get an oil change. And you only get them once a year, but it's$2 ,000 to$3 ,000.

27:00And so you had to do all these other maintenance things. And it was just astronomical what the cost of maintenance were. And so I think for most people, you need to look at having your car payment be 7 % or less of your income. So the average car payment here is$734 per month, and your maintenance should be about 5%, but 12 % overall. Finagle that number any way you want. 12 % of your income is what your ongoing costs should be with that vehicle. And then 10, what's that 10 number mean? That means you drive the car for 10 years or longer. Why? Because you're gonna squeeze the maximum value out of that vehicle.

27:32And what we don't wanna do is just keep buying depreciating assets over and over and over again. This is why we only have car payments for four years because that gives you six years of no car payments that you can take those extra dollars and put them towards retirement. You can do 401k sprints during that time. You can do all these different things because you decided to live differently. What most people do is every three years, they get a new car or they get a used car and they just kind of keep recycling that cycle. Not you, though. We're going to drive our cars for longer because the longer you drive your car, the more value you can squeeze out of it.

28:00For example, I drive a 2018 truck and I'm going to drive that thing until it dies. Let's see if we can get it to 300 ,000 miles. We're going to find out if we can. And it's going to be one of those things that I cannot wait. It's going to be a badge of honor to see how many miles I can get on that vehicle. Now, number 14 is auto loan debt totals to$1.63 trillion. Listen, everybody, I don't think this number would be that high if more people would drive their cars 10 years or longer. Find a reliable vehicle that will go for 10 years. Some of you are buying these cheap cars that are junk that will not go for 10 years.

28:33Find a reliable vehicle. Toyota, Honda, all are top tier in reliability ratings. Go find one that has top tier reliability ratings and drive it longer because we would not have this much auto loan debt. Imagine if everybody drove their car for 10 years, that means 40 % of people would be having their car payments going. If they followed the 24-12-10 rule, then people would be having, 40 % of Americans would be having a car loan, 60 % would not, and there would be a lot less auto loan debt out there and they would be much, much better off long-term. Number 15, let's get into mortgages now. 2.1 % of mortgage balances are 30 days past due.

29:09This is a scary statistic for a lot of people out there. it could be a lot worse. In fact, in 2008 and 2009, it was a whole lot worse. But there is a rise in delinquencies from last year that can signal broader financial strain. And so we want to make sure that we have our emergency fund buffer in place. Another reason why we want to have our emergency fund is because if we ever got in a situation where we needed to pay our mortgage, we have an emergency fund in place that takes care of our expenses if we lost our job or if something else arises. Two is make sure you're setting up your mortgage payment on auto pay.

29:41This is one of the easiest things to do. And if you're manually going in and paying your mortgage every month, you could very easily forget. And so automatically making those payments is really important. Three is if your payment is too high, see if you can refinance. If you got a mortgage during times when interest rates were super, super high, maybe you have an 8 % or 7 % mortgage, see if you can refinance over the course of the next couple of months and how much it would save. And then always avoid borrowing against your house unnecessarily. A lot of people are getting HELOCs now and all these other things.

30:09and it's fine to have a HELOC open for various reasons, but do not just go out and then go spend that money on something random. Number 16 is 56 % of Americans aren't saving for retirement at all. So if you're not saving for retirement, then you're fully dependent on social security. This is gonna be a huge problem because if something changes with social security in the future, and we have no idea if it will, in fact, I like to treat my social security like it's not gonna happen because if it does happen, it's gravy on top. I can use that money for vacations. I can use that money to help out people.

30:40I can use that money, do whatever I want with it. But it's just gravy on top. Where 56 % of Americans aren't saving for retirement at all is going to be a huge, huge problem. You need to have a retirement plan in place. In Master Money Academy, we teach you how to map all of this out. But if you do not know how to map all of this out, then you need to have an understanding of what to do next. So number one is you need to start saving as soon as you possibly can. Start saving in retirement accounts. Roth IRAs, 401ks, HSAs, or taxable brokerage. Start saving money somewhere and investing those dollars for retirement.

31:10Because if you just save cash, you're never going to be able to retire. You have to invest your money because those who do not invest, they will never, ever, ever be able to comfortably retire. Living on social security when it continues to be edging on a cliff is not a retirement strategy whatsoever. You need to make sure that you have cash and money invested for the long run. Now, if you're brand new to investing, we have an investing class that's free, Investing for Beginners. So if you go to mastermoney.co slash investing for beginners, you could check out that free class there. Number 17 is nearly half of Gen Xers say they're behind on retirement savings.

31:45So Gen X is entering the final stretch before retirement and catch up time is limited. And the cost of waiting grows exponentially for every year they miss out. So a couple of action steps if you are in Gen X and you are behind. Number one is to max out your catch up contributions. So once you're over the age of 50, you can add an extra$7 ,500 to your 401k in 2025. and an extra$1 ,000 in your Roth IRA in 2025. Also, make sure you're auditing your expenses. Look at your expenses and make sure that you're looking at those so you can actually get some free cashflow to catch up on retirement savings.

32:19Three is if you are paying for your children's college expenses or if you're paying for your children's housing, if you have adult children, you need to stop that. You need to take care of yourself first because there are no loans for retirement. And instead, they're going to have to go ahead and take out student loans. This is the reality of this is you got to take care of yourself first and then help out others. It sounds counterintuitive as a parent. I know, I understand, I have three kids, but it has to happen this way because otherwise your kids are going to have to take care of you in retirement and that's gonna be a way bigger financial burden for them down the line.

32:49You need to understand that taking care of yourself and your retirement first, then you take care of your kids down the line. Next, invest aggressively to make up lost time because if you do not start investing aggressively now, you are gonna run out of time to get compound interest working for you. So you got to make sure that you are investing aggressively and investing early. The number 18 is 53 % of millennials say their debt exceeds what they've saved for retirement. And so a lot of millennials out there are struggling with debt because they feel as though or because they have gone through a cycle, a long cycle where affordability is at an all time low.

33:26And if that is you, then there are a lot of things you can do. First, get rid of that high interest debt. Two is work through a five-year plan to eliminate debt and start to get positive cash flow, a positive net worth, so that you can get to the point in time where you are investing those extra dollars. Number 19 is half of retirees fear outliving their savings. So one of the biggest financial anxieties in America is retirees are worried about outliving their savings. And without a sustainable withdrawal strategy, people either underspend out of fear or they overspend and they will run out. You need to know the 25X rule, meaning how much you spend every single year, you multiply that by 25, and that's how much you need to have invested.

34:05So if you spend$80 ,000 per year in retirement, and you multiply that by 25, you need$2 million invested. That means you can withdraw$80 ,000 per year based on the 4 % rule and still preserve that wealth throughout retirement. And now that number is slowly ticking up based on the creator of the 4 % rule, Bill Bangen. He just wrote a new book stating that he thinks the real retirement number now is about 4.7%. And we'll dive deep into that in a future episode coming up. Two, in retirement, see if you can diversify income streams. So you got your investments, maybe you have a pension, social security, and if you can get some side income going too, those four things are going to tremendously help you in retirement.

34:41Three is if you're approaching retirement, make sure that you are building up that emergency fund. Having an emergency fund of a couple of years of cash on hand can be very, very helpful for a retiree because when the market is down, they can pull on some of that cash if there are drastic market downturns where they don't have to pull on a damaged portfolio during that timeframe. And then if you can, if you have the ability, look at social security options. What happens if you delay social security? What happens if you take it early? Think through those options and how you want to handle that going forward.

35:08Number 20, buy now, pay later users missed payments at a 41 % clip this year. So buy now, pay later feels invisible to a lot of people. And more and more people are taking out buy now, pay later loans. And this is something where I have seen buy now, pay later for folks on Uber Eats. If you're taking out buy now, pay later for something like Uber Eats, you've got yourself an issue. Do not do that. Buy now, pay later for groceries. So they're going into debt for certain necessities that they need. If you have buy now, pay later on hand and you're missing payments, then you need to treat buy now, pay later as any other loan.

35:43Only use buy now, pay later for essentials if you're going to use it. I would never, ever use it. In fact, my rule is to never use something like buy now, pay later. It is not worth it. Pay early or on time. So if you are going to use it, you need to have the ability to either pay it off early. And I'm talking months early before major interest kicks in. If there is major interest, depending on what type of plan that you have. If you're not going to listen to me, if you're going to say, I'm going to do buy now, pay later anyways, especially if it's 0 % interest, something like that, only do one at a time.

36:10If you're going to go that route and you're not going to listen, only do one at a time. And then really, the reality is build a real emergency fund so you don't have to utilize buy now, pay later because I am not a fan. Number 21. This is a big one that's happening right now. The average American spends$3 ,284 on sports betting over the course of the past year. Now, let me tell you something. Sports betting is going to become a bigger and bigger problem. And for a lot of people out there, when they cannot handle sports betting, it becomes an issue that ruin your finances. I don't mind someone sports betting, you know, small amounts of money.

36:43But here's what I would say. When you bet, number one, set a hard spending limit. You are not going to spend over X amount of dollars per bet. And you're not going to spend over X amount of dollars per week. For example, if you love betting on football games, then set a$20 limit per week. There are mentors that I've had who are billionaires who have had to go to like casinos for business meetings and stuff like that. They said, my limit to gamble is$20. I will not gamble more than$20. I understand math. It's just for entertainment value. And this is what I want you to understand. You need to set limits surrounding these types of things if you're going to partake in them.

37:13Hey, I know it makes the game more enticing. I know it makes it more fun, enjoyable. whatever else you want to say, but you got to make sure that you have parameters set in place. Otherwise, you're going to get excited, you're going to get emotional, and you're going to buy into something and do the wrong thing. So really set hard spending limits. Two, never ever gamble with borrowed money. If you gamble with borrowed money, you are really doing yourself a disservice when it comes to your finances. Three, treat gambling like entertainment, not investing. There is a lot of people out there who think gambling is investing.

37:44And I cannot tell you that there is nothing further from the truth. If you think that, you don't understand math. Gambling is not investing. And if you treat it that way, that is a huge problem. Number four is if you struggle with self-control, there are blocking tools out there that you can utilize. There's one called Gamban that you can put on your phone and it will block all those apps for you. And then number five, redibract a portion of your gamble money to actual investments and savings if you are winning at some decent pace here, okay? I do not want you to just continue to reinvest your gambling money into gambling because guess what's gonna happen?

38:14It's going to go away at some point. Even if you've been winning for a couple of years, it's not going to end well. Okay? So just remember that. Gambling is a huge, huge problem, and it is rising at a rate that I don't love. One in four married Americans admitted to some form of financial infidelity. This is number 22. So hiding debt, secret accounts, or spending creates financial chaos and erodes trust in a marriage. And so you want to make sure that you are on the same page in your marriage. So have regular money dates with your partner to review finances regularly. Use shared financial dashboards like Monarch Money.

38:49That is a great place to have a financial dashboard shared that you can look at. Three, set agreed upon personal spending limits so that each of you knows how much they're spending. Continued communication is just the biggest thing when it comes to money in a relationship. And so continuously having this communication is really, really important. Four is create a shared financial plan. Now we have a checklist that we talked about a number of different times on how to have conversations surrounding money. And one of the big things that I want you to understand is that you need to have shared goals that you agreed upon and you need to have a shared financial plan.

39:19And really you need to have regular money meetings. You need to have conversations that are happening all the time. And I want you to frame these money meetings in a specific way. I want you to say, what are our dreams? What is our dream life that we really want to pursue and go after? And when you figure out what your dream life is and you have those shared goals, all of a sudden managing money together becomes so much easier. But you got to reframe it from, we got to stop spending so much to what is our dream life? What are we going to be doing in the next 20 to 30 years? Where do we want to live?

39:48What vacations do we want to go on and create this safe space that you can both work towards? That is the way to do it. And if you haven't tried it that way, I highly encourage you to try it out. And then figuring out the underlying trust issues that are happening, not after a blow up, but having this conversation. Hey, I don't love it when you spend$300 on something without having a conversation with me. And it's not like you have to ask for permission, but I would just love to have the conversation and know what's going on. Stuff like that is going to go a long way with trust. Number 23, financial scams cost Americans$12.8 billion over the course of the last year and AI scams are surging.

40:26Now, this is a huge problem, my friends, that most of us need to make sure that we are protecting against. So number one is using multi-factor authentication or authenticators like Google Authenticator or Microsoft Authenticator on all of our financial accounts or any other accounts that store our credit card or password. That's number one. Number two is making sure that you freeze your credit. So you can go to all three major credit bureaus and preventing new account fraud, you can freeze your credit so that anytime someone wants to try to open an account in your name, they can't do it because your credit is frozen.

40:57Then let's say, for example, you want to get a mortgage or you want to open a credit card. You just call the three major credit bureaus. Make sure you get it unfrozen. Boom. It's done. You open up the card and then you freeze your credit again. That way, no financial fraud can happen to you because you are freezing your credit. Okay? So that's number two. Number three is to remove your personal information from data brokers. So data brokers out there have your personal information and they are selling it to a bunch of different places. If you go Google your name, Google your address, look it up in quotations, data brokers have your information and they are selling that information.

41:30So if somebody gets a portion of your information, let's say they get your name and your address and they're trying to find even more information about you, like your phone number, those types of things. Or maybe they get a piece of your social security number or they get some other information that is very, very sensitive. All they have to do is go to one of these data brokers and get the rest of your information and they can open a bank account in your name or they can open up student loans in your name or a credit card. And this, my friends, is a place you do not want to be. So to get your personal information removed, the best thing to do is use a service like DeleteMe.

41:59So if you go to joindeliteme.com slash PFP20, you can get 20 % off DeleteMe. What they do is they go to those data brokers and they say, hey, please remove this person's information from your data bank. And they get your information removed off of these websites so that you do not get exposed. And Delete Me does a ton of work to do this. And so it is really, really important to make sure you get your personal information removed from these websites and they continuously get it removed so that you're not susceptible to any of these scams or fraud that are out there. Number four is if you get phone calls in and you're not sure if you're talking to the right number, hang up and call back on an official number.

42:34Because I've seen a lot of people who will call it and really make sure it's an official number. So I actually Googled a customer service line recently. And I talked about this, I think, on a recent episode. But I Googled a customer service line recently. And on Google, someone had the fake number as the number one search result on Google. And so I called and I go, the questions they're asking me are very fishy. And so I hung up and then dug deep and found the real customer service number, which was like number three or four on Google. And I know better. And I did that. And so it's going to be one of those things where I want you to make sure that you're verifying identities independently and then talk openly about scams and making sure with friends and family, you're always staying alert.

43:09These are getting better and better. And with AI, it is going to be one of those things where people are going to get scammed more and more and more. So removing your personal information becomes even more important. So if you go to join delete me dot com slash PFP 20, that is the best place where you can join delete me and ensure that you're getting your information removed. It is the best service out there by far and a service I've been using for years and years and years. And they've been a partner of this show for a long time too. So love, love, love, delete me. And you got to make sure that you are not getting scammed.

43:3618 % of American adults, this is number 24, have lost money to a scam. So that's nearly one in five adults. And these losses are really recovered. So a lot of times I just heard a story about someone who lost$100 ,000 to a scam, a really good scam, and they just caught the person at the right time. They took$100 ,000 from them and they could not get the money back. So you need to educate yourself on the most common scam tactics, number one. Number two is you need to regularly check bank and credit card statements for this reason. Number three is keep personal info off public databases. Again, Delete Me will remove it from those public databases.

44:10Four, report scams immediately if they do happen. And make sure you talk about scams openly because again, this is how we spread this information. And so it's really, really important to make sure your data is secure and make sure your data is structured in a way that is hack-proof. And in Master Money Academy, we're going to be working on a course to protect your data and your privacy. And so that'll be a really, really good and important thing that we need to note. Number 25 is there has been roughly$20 billion in crypto stolen or lost between 2021 and 2024. So unlike traditional bank accounts, crypto often has no protections or recourse.

44:44So one hack or rug pull or lost key can wipe out an entire savings. So never store large amounts of crypto on an exchange until you can do cold storage or remove it from those exchanges, that's going to be number one. Number two is use hardware wallets for long-term storage. Number three is only invest money that you can afford to lose. If you can't afford to lose it, then it's something where we're going to have to figure out ways to protect that money. Number four is making sure that you vet projects carefully in crypto. So I only invest in Bitcoin when it comes to crypto, a little bit of Ethereum in the past.

45:12And so most people are looking at get rich quick tokens and things like that. Just be very, very careful. And then always keep crypto as a small portion of your portfolio, not the entire portion, because there's a lot of scams going on in crypto. Some of it like Bitcoin is the one that is getting institutionalized. So that is a different thing. If you haven't heard our episode talking about that, that is a whole different scenario. But just making sure that you are very, very careful is really, really important. So those are the 25 scary money statistics of 2025. If you guys have any questions, please join the MasterMoney newsletter.

45:43Go to mastermoney.co slash newsletter and send in your questions there. We'll have some Q &As coming up and we will be answering your questions on those Q &A. So make sure you send some of those in coming up over the course of the next couple of weeks. Thank you so much for being here on this episode. Our goal is to bring you as much value as we possibly can. And again, if you're interested, join Master Money Academy. Go to mastermoney.co slash join and you can get more information and get a video that shows you backstage what happens in Master Money Academy. So thank you so much again. We will see you on the next episode.

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