Fred's friends Julio and Ah Chew are getting on Fred's nerves and Lamont takes on the challenge of trying to change Fred's bigotry towards minorities. When Lamont fails, he decides to move out and in with Julio, something that unnerves Fred who doesn't seem to get use to the arrangement.

Lamont has Julio, Rollo and another buddy over for a poker game and Fred has had it with their gambling. Meanwhile, an old friend of Fred's, Al Banks, a professional gambler, stops by for a visit and this gives Fred an idea on how to teach Lamont and his friends a lesson. However, the lesson goes awry and Al runs out with the cash.

Grady decides it's time for a change and moves out of Watts and into fashionable Westwood to live with his daughter, Ellie, her husband Hal, and their two children, Laurie and Haywood. As a housewarming gift, Grady purchases an oil painting to hang over their fireplace. However, the painting he chooses proves to be quite distasteful.

Lamont leaves town with Rollo to go on a fishing trip but before he goes, he makes a bet with Fred. He is sure Fred won't make money during the week he is gone. Fred sets to prove him wrong by renting out Lamont's room. Fred finds himself in a bind when the pregnant girl he boarded goes into labor.

In another get rich quick scheme, Fred decides to go down to an escort service with a friend of his and try to apply as escorts. Flatly rejected, Fred decides to open his own escort service complete with false advertising which results in Fred having to escort three ladies in one night.

While Fred is babysitting his soon-to-be grandson, Roger helps a customer and sells him some junk including three medals. After Fred learns of Roger's sale he envisions a story about just how he got those medals. Fred's story has him as a Patton like character fighting during World War II and battling espionage.

Three jewel thieves try and find a way to smuggle some expensive diamonds from Hawaii to L.A. That is where Fred and Lamont come in. Fred goes to Hawaii to attend a Junkmen of America convention. The crooks then plan to sneak the jewels on Fred so that he can take them to L.A. without knowing anything about it.

During a mishap at the airport Fred accidentally misplaces the suitcase with the diamonds and the crooks start chasing Lamont and him all over Hawaii, trying to get them back. Meanwhile, the cops close on in, but not before guns are drawn on Fred and Lamont as the crooks trap them on a boat.

Fred has been chosen to represent the Watt's businessmen on a community relatives committee and his first official decision is to allow the public library to be open an hour longer. However, his next decision doesn't seem to be so easy to decide after a crooked businessman tries to bribe Fred with $1000 to vote for a building expansion.

The tax season has come and Fred and Lamont have been going through their inventory to prepare their tax papers. However, Fred gets preoccupied when he discovers Redd Foxx is in town holding a look-alike contest and Fred is certain he will win the contest and the $100 that comes along with it.