Upcoming Podcast Interview With Elaine Floyd! Stay Tuned!

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Ohhhh man. I just lined up an interview with Elaine Floyd of Horsesmouth.com for my podcast!!!

In the realm of Social Security planning that would be like lining up an interview with Tom Brady regarding quarterbacking.

Elaine is so flipping busy that the interview won’t be until September.

But don’t you worry,  I’ll post it here upon completion.

Episode # 57 – TSP F Fund – What You Need To Know

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The TSP F Fund is the Thrift Savings Plan version of a corporate bond fund. However, if you dig a little bit you’ll quickly see why this fund is NOT a corporate bond fund in the least.

Why do I say this? Look what happened in 2008. In 2008 everything, and I mean EVERYTHING got hammered. That is, everything for government bond funds. Government bonds did swimmingly in that year as everyone was fleeing from risk into assurance.

What did a typical corporate bond fund do in 2008? Well look at USAA’s Income Fund, USAIX. It was down over 5%.

What did the TSP F Fund do? It was UP over 5%! The only way to do that was to have exposure to government bonds, such as GNMAs.

Does the F Fund have some corporate bonds in ti too? Yup. That’s why I actually changed my mind mid-episode as to the fund I’d choose for my fixed income holdings, the G Fund or the F.

The F has a broader range of fixed income products in its portfolio. That will lead to a bit more risk but should provide more return too.

In fact over the last 10 years we see that precisely. The F fund doubled the rate of return of the G. In a low yielding environment every percentage point you can get helps, a lot.

So, if you can get say double the rate of return of the G Fund without doubling the risk, that’s a chance I’d take indeed.

Will it ALWAYS double the returns of the G fund? Of course not. It may in fact perform worse. I’ve no clue.

But given it’s track record and history of never having wealth destroying years, I’m pretty fond of the F fund.

Now, mind you, I’m not fond of bond funds in the whole. After taxes and inflation, it’s going to be awful to make any money in them.

But if I needed to put a bond fund into my portfolio, I won’t yell at you for choosing the TSP F Fund.

 

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Here’s the episode for the G Fund.

Podcast Episode #56 – TSP G Fund – What You Need To Know

I’m a huge fan of the Thrift Savings Plan offered to Federal Government employees, including military personnel.

A cheaper investment platform I do not know. The funds in the TSP average 3.3 basis points in expenses. That means for every $1000 you have invested in the TSP your cost is 33 cents.

That’s incredible Think about it another way, if you pay 1% in investment expenses it’s going to cost you $10 per $1000 per year.

Your investment manager must have some pretty good chops to overcome that starting point. And, in fact, he/she most likely won’t.

In this episode I analyze the G fund in the TSP. The G Fund is the Government securities fund.

I show you why you shouldn’t expect more than around 3% a year in rates of return over the next decade. Doesn’t mean I think it’s a bad fund, it just is the reality of the interest rate cycle.

Remember folks, bonds do not have capital appreciation. You get paid interest and interest only.

Podcast Episode #55 – Everyone Should Invest in A Roth 401k – Yes, EVERYONE!

The Roth IRA is the greatest financial planning tool ever invented for long term wealth accumulation. Life insurance comes in a close second but the problem with life insurance is someone has to die to benefit from it.

Rather not have that happen. So use the Roth everywhere you can. And it starts with your 401k.

Podcast Episode #54 – Planning, Pensions & Companionship = Happy Retirement

In this episode I review an older article (2005) from Keith Bender and Natalia Jivan called “What Makes Retirees Happy”.

Now one might question why I’m using a nearly 20 year old article to discuss. Good question. The answer is because this was another seminal article, at least for me, as I began my career painting the picture of what works for retirees. And folks, it’s not wealth that makes people happy. Not by any stretch.

Yes, wealth can help. But there becomes a negative utility in having more wealth. That is a fancy economics term meaning the MORE you have of something the less you value it.

What do retirees value most? It’s having the choice to retire as opposed to being forced to. Also, having a guaranteed flow of income from pensions and annuities, not just Social Security, combined with an asset that can grow to provide a potential higher standard of living.

Lastly, it’s the ability to spend time with one’s spouse, or close friends.

Notice nothing states HOW much income one needs to be happy. In fact, there is no correlation with higher income levels and retirement well-being.

But having loved ones, guaranteed income to cover expenses and choices.  You get those three things, you’re going to be good to go.

Listen to learn more.

Episode 53 – Interview With Nicole Sauce, Coffee Maker, Health Care Expert & Business Consultant

Fantastic interview with a friend, and my own personal business consultant, Nicole Sauce.

Nicole runs a coffee roasting shop in Middle Tennessee called Holler Roast Coffee. Which you can find here.

But there is SO much more to Nicole than simply making an incredible cup o’ Joe.

Nicole was very active in the movement to provide options for people in their health care. In fact, she had a huge amount of success in that capacity. However, being on the road 3 weeks a month was going to drive her to an early grave.

So, she decided to move to middle Tennessee and live a more minimalist lifestyle, raising crops, selling coffee, but still conducting business consulting and website development.

Nicole actually was instrumental in helping me define my brand for my business and developing my website. What I like about Nicole is not only does she have experience but she’s  down to earth too.  She takes your goals and concerns and is able to help you define them, narrow them down and then create a business to work within that context.

As a budding entrepreneur you’re going to have a million things you want to accomplish. The problem is, you can’t do it all. You’ve got to focus.  Focus people, focus!  Nicole helps with that. I can’t stress how important that is and I can’t recommend her and her business Spark Communication enough.

Lastly, Nicole also does a podcast which focuses on her experiences on her homestead.  Just good stuff across the board.  Find Nicole on her blog here:

Episode #52 – Interview About Financial Planning With Inga Chira, PhD, Professor & CFP

This is a very welcome interview for me in that Inga Chira is probably my twin when it comes to financial planning. Basically, my advice to clients for now on is simply to say “what she said” because she is so spot on.

She has a book out on Amazon for younger readers, say in their 20s titled Mastering Money: A Simple Guide to Achieving Financial Success. It came out in December 2017 and has 52 5-star reviews, ALL verified purchases too.

That means people who are actually parting with their cash are commenting that they got way more value from the book than the $ they paid for it. Can you find a better testimonial? Nope.

Inga is a native of Moldova but came to the US as a teen and never looked back. That’s Moldova’s loss but certainly our gain as Inga’s been kicking butts here in the US ever since.

A PhD in finance. Has her own financial planning firm. Is teaching college students as well and raising a young child with possibly another coming down the pike. I mean, talk about legacy planning. I love it and you will love the interview too.

Get the book here.  Free on Kindle Unlimited!

Find Inga’s website here.

You can find Inga’s LinkedIn profile here.

Episode #50 – Why Medicaid “Planning” Is Wrong – In So Many Ways

I was in a debate of sorts with some fellow financial planners on a Facebook page. My “opponents”, for lack of a better word, were arguing that to engage in techniques that allows one to use Medicaid for health care was a legitimate pursuit, even if one is affluent.

To say I am shocked at this doesn’t do justice to how I truly feel.

Let me explain what Medicaid is. Medicaid is health insurance for poor people. Medicare is for when you turn 65 and you qualify regardless of income or assets.

Medicaid though is based on your asset level. The goal was to assist those who are indigent with their health care.

What Medicaid “planning” does is try to get people who could otherwise afford to pay for their own care to hide assets in order to qualify for government aid.

Here’s the problem with this. Medicaid is BROKE! There is no money. And yet, under Obamacare there was huge incentives for individual states to expand the program…even though the program is already broke. It’s crazy. As at some point, the bills have to be paid.

Medicaid is not bringing in enough money to be self-sufficient. Do you want to guess what will happen to keep the program afloat? Well as is always the case with socialistic programs, fees will in increased and services will be reduced in the form of:
1. increase taxes on ALL Americans
2. reduce services
3. reduce fees paid to care providers

Thus for every affluent person on it, means there is less for poor people who truly have no other options.

Also, what do you think will happen to the care provider pool as their reimbursements get reduced? If you said it will reduce the number of care providers and the quality of those who remain, you are spot on.

So, as basic economics would tell us, increased demand due to more people being added to the rolls of Medicaid. Yet Medicaid is not solvent as it is, so inherently there will be reduced payments to providers as more ‘poor’ people sign up. Inevitably you have less providers. Demand (number of people on the system) increases and supply (number of people providing the services) drops, what happens next?

Rationing of course! And, of course, higher taxes for the rest of us.

As the Investors Business Daily said back in 2016:

So where will the money come from? Kaiser says eight of the expansion states are slapping new taxes and fees on providers to cover costs. Other states, the report says, will use “general funds.”

In other words, states that expanded Medicaid will either have to boost health costs, raise taxes or cut spending to cover this ObamaCare “freebie.” Given that Medicaid is already swamping state budgets, this will not be good news.

No such thing as a free lunch folks.  Never has been, never will be. So, if you are planning on using Medicaid to provide health care, remember there is a cost. And that cost is being paid for by your friends and neighbors, which is fine if you truly are indigent.

If you’re able to afford your care though, why not go ask your neighbors what they think about having their taxes raised to foot your bill.

Episode 51 – Interview with Skip Ritchie: Why Zimbabwe May Be Your Best Investment

In this episode I interview a long time family friend, Skip Ritchie.
Skip’s been a world traveler, going to varying countries to spread the Good News while assisting to the needs of the poor. A true man of Christ indeed.

Over the past few years, Skip has been going to Zimbabwe which has interested me greatly. I’ve been a long time follower of the happenings in Zimbabwe, with the celebration of ending the colonial, apartheid rule, to the devastation caused by Mugabe and now to a new hope as Mugabe has left the scene.

It’s important to understand that Zimbabwe/Rhodesia was considered the “breadbasket” of ALL Africa in the middle part of this century.

Wonderful people. Lots of resources. The British technical know how. Yet, Mugabe ruined all that with his tyrannical reign. Heartbreaking is not a strong enough word.

But life goes on. And Zimbabwe may be on the threshold of something huge..with a bit of help from abroad, government reform and some good luck.

The people of Zimbabwe, as Skip tells us, are hardworking, wonderful people who speak English and were educated in a Western-style system, that which was left over by the colonial regime.

There is no reason these folks can not become successful in their own right. Unfortunately, as is typical in these third world nations, the brain drain is a huge problem. The best and the brightest leave the country to pursue their passions on other shores.

But Zimbabwe is ripe for investment into the people there. It just needs a boost of small financial commitments and technical know-how from abroad. Once the infrastructure is in place, man, oh man, it’s going to be wonderful to behold. And YOU can be part of it!

You can learn more about Skip and his organization Orphan Adoption, Reconciliation & Restoration Services here.  If you could find it in your heart to contribute it would be wonderful.

Skip tells the story of a grandmom whose daughter left her baby at an orphanage and fled to South Africa.  All’s it took was $20 of gas money to find the Grandmom who readily adopted the grandbaby.  But if you’re only making $80 a month, who’s going to risk driving into the bush to see if you could locate and identify the grandmom?

Skip was able to do that. And now there is one less orphan in the world.  That my friends is the grunt work that makes the world a much better place.