Read Time: 4-minutes
Happy Saturday,
Here is this week’s edition of 6-Point Saturday — financial insights to help you make smarter money decisions.
Table of Contents*
*Clickable in the online version.
Point #1 — Short Story: Good Will Hunting’s ‘Harvey Keitel’ Role
“As he was struggling to break into Hollywood, Matt Damon read about how Quentin Tarantino did it.
Essentially, he got a big-name actor (Harvey Keitel) to want to star in Tarantino’s first movie (Reservoir Dogs) then leveraged that to get the movie funded.
‘And so,’ Damon said, ‘We wrote Good Will Hunting and that part that Robin [Williams] eventually took—we called it ‘the Harvey Keitel part.’’
‘Ben [Affleck] and I wrote the movie specifically because we wanted the parts as actors…But we knew we needed a big-name actor who could get us some money because Ben and I were worth nothing.’
Understanding the relative value of being unknown actors, Damon and Affleck knew they’d need help drawing interest from studios and investors.
‘And so we wrote ‘the Harvey Keitel part’ really open-ended. So we could adjust it: if Morgan Freeman or Denzel Washington wanted to come in and play it—we could make that character from Roxbury [a neighborhood in Boston], and we could explore the historic racial tension in Boston. If Meryl Streep took the part—instead of a father-son relationship, we could make it a mother-son relationship.
So we really left it open-ended because we wanted to cast as wide a net as possible because we were just trying to get the movie made…And then once we got Robin to sign up to do it, that’s really what got us a green light to make it…He changed our lives.’”
Smart strategy.
You always hear stories of writers creating roles with specific actors in mind. But that can be risky.
Instead, Damon & Affleck left ‘the Harvey Keitel role’ “open-ended” to reduce risk and maximize the odds of landing a big-name actor.
The decision was ultimately life-changing.
That’s a lesson that also applies to our finances.
There are all kinds of ever-changing variables that impact our financial plans. Many people try to forecast markets, interest rates, and economic growth.
And, of course, there’s a certain amount of reasonable assumptions that we need to make.
But relying too much on a single forecast can wreck your finances. Instead of predicting, position yourself in a way so that you’ll succeed in any environment:
You don’t know where mortgage rates will go → plan for affordability across a range (more on this in Point #2)
You don’t know where the S&P 500 will end the year → invest steadily (DCA, diversification)
You don’t know exactly what you’ll want to do in retirement → save enough to give yourself options
Trying to forecast a specific outcome or build a strategy around a highly unpredictable variable is risky.
Instead, focus on positioning yourself in a way that creates durability and gives you options.
Position instead of predict.
Point #2 — Interest Rate Forecasts
I shared this idea with MarketWatch this week, in the context of decreasing interest rates and attempts to forecast future rates:
“Needless to say, no one definitively knows what will happen with mortgage rates this year. Whether they stay above 6% or come down, taking stock of your risk profile and overall goals is key for anyone actively taking part in the housing market in the second half of 2025, says Benjamin Daniel, a CFP.
‘Smart buyers focus on all-in costs,’ says Daniel. ‘You need to make sure you can handle phantom costs like maintenance, repairs, and upkeep. Buyers need to run the numbers. A good starting point is shooting to keep housing under 28% of your gross income and your total monthly debt under 36%. It’s a simple rule-of-thumb that’s far more valuable than Fed rate forecasts.’”
Are future Federal Reserve interest rate decisions important?
Absolutely.
Should they be the main drivers of a homebuying decision?
Probably not.
Interest rates can easily continue heading down, but they could also maintain their current levels, or even increase.
Alternatively, there are many other knowable factors that go into the home ownership decision.
Factors including your liquidity needs, intent to stay in the area, financial goals outside of home ownership, risk tolerance, cash flow, and emergency funds.
So, it’s wise to focus on these impactful factors we’re sure about instead of overweighing speculative rate forecasts.
Interest rate considerations can inform our homebuying decision, but don’t determine it.
Point #3 — “Should I Refinance?”
A Reddit user is considering whether to refinance a mortgage from the current 7.375% rate to 6%:
Recently received a call from our lender that we were good candidates for refinancing. Purchased the home for $330,000 in Dec. 2023 at 7.375%. Remaining amount currently at $308,000. Lender called and said he could refinance to 6% with $5k in costs rolled into the new loan, so about 17 months break even point at about $285/month savings. Does this seem wise to do? Of course, we’d all love rates to drop more but nobody can indicate or guarantee that happens and if so, when. We plan (barring any unforeseen changes) on being in this house for a while. What would you do in this scenario?
The first thing I would do here is shop around. If a lender is initiating a refinancing, it’s worth exploring other offers.
This individual is on the right track here. A quick, initial check when considering refinancing is conducting a break-even analysis.
To do this, you need your proposed rate & payment, closing costs, and how long you intend to stay in your house.
With those figures, you can easily determine your breakeven period:
Take the amount of closing costs, $5,000 in this example, and divide it by the monthly savings from the lower payment, $285.
That’s about 17 months.
Since this individual has plans to stay in this house for the long term, the breakeven analysis makes this offer attractive: they will be in the house long enough to recoup the closing costs through the cumulative lower monthly savings.
Similar to the home-buying situation above, there are more than just rates to consider, and whether you want to wait for rates to potentially decrease further is something you need to think through.
But start with a breakeven analysis and always shop around.
Point #4 — 3 “Financial Lenses” for Big Decisions
When you start looking at new homes or speaking with lenders, you can easily start envisioning how great your life or finances can be.
But as Morgan Housel puts it:
“Planning is important, but the most important part of every plan is to plan on the plan not going according to plan.”
— Morgan Housel
— #Money Wisdom (#@MoneyWisdom_)
1:28 AM • May 28, 2025
Overlooking how things might go wrong is how people end up house poor (spending too much of their income on their home) or forced to sell at the wrong time.
One of the most helpful ways to decide on these kinds of decisions is conducting a ‘Scenario Analysis.’
To avoid being overly optimistic, you can quickly look at your situation through 3 lenses, or scenarios:
Best-Case: This is the optimistic outcome: everything goes better than expected (e.g., high home appreciation, low expenses, rates fall).
Base-Case: The Base-Case is the most likely/realistic scenario, given current, reasonable assumptions.
Worst-Case: The pessimistic outcome: things go poorly (e.g., low returns, high unexpected expenses, rates increase).
The bottom line: Running a quick scenario analysis acknowledges uncertainty & guards against overly-optimistic assumptions. It encourages you to think in ranges (rather than precise forecasts) and helps you decide if you can withstand any downside risks.
Point #5 — Quotes of the Week
Continuing the “position instead of predict” theme, which of these is your favorite?
One of the most beneficial skills you can learn in life is how to consistently put yourself in a good position.
— #Shane Parrish (#@ShaneAParrish)
2:02 PM • Feb 19, 2022
“Wealth is not about having a lot of money, it's about having a lot of options.”
The cost of debt is the interest rate (easy to calculate) plus the loss of future flexibility and options (hard to calculate).
— #Morgan Housel (#@morganhousel)
10:55 PM • Mar 9, 2025
Point #6 — My Question of the Week
When has flexibility been more useful for you (with your money, career, or life) than needing everything to go according to plan? How can you incorporate more flexibility into your next big decision?
Reply to let me know! I read every response.
Thanks for reading — I hope you found a helpful idea or two.
I’ll see you next Saturday with more.
Have a great weekend,
Benjamin Daniel, CFP®
Founder, Money Wisdom
P.S. Want to take control of your money, stop stressing about your expenses, & feel confident about your financial future? There are 2 ways I can help you:
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Disclaimer:
This material is not investment or tax advice. No responsibility for loss occasioned to any person or corporate body acting or refraining to act as a result of reading this material can be accepted by the publisher.
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