Don’t Trust the Financial Media, Either

At Least 10 Times a Week…

…I receive emails asking to provide access to my crappy, Social Security spreadsheets.   The emails are so many I don’t even respond anymore, which I feel guilty about.

I also receive many other people’s spreadsheets for me to “review.”  I did that a bunch when I first started out, looking for a substitute to what I created.  But many of the spreadsheets escaped me from a logical perspective. So, I stopped opening those up too and simply deleted them.

However, by happenstance, I opened up this one guy’s spreadsheets and was blown away.  I’ve been using these for the last 6 months now, exclusively, other than my own of course.

I’ve been telling him he needs to offer these to the general public as there is a HUGE demand for quality, easy-to-understand spreadsheets AND that he should charge a fair price too.

I’ve been egging him on this saying he needs to fill the demand. But he was somewhat hesitant.

Spreadsheet design is a labor of love and some people simply won’t feel the love you’ve put into it.  In this case, though, this guy’s spreadsheets are so easy, you can’t help but be impressed.

So, if you are interested in spreadsheets for taxation, Social Security, bucket strategy, etc. go to this link. Dan is charging, as of now, only $35 for access to his stuff.  I’ve no idea how long that price will last.

And I’ve also no idea if you’ll find value out of his spreadsheets. I have, indeed.

I am in no way affiliated with Dan and get no “commission” or referral fee or anything of the sort.   He is actually doing a service for me as now I can refer people who are interested in my infantile spreadsheets to his stuff.

Hope you find them helpful.



We all know the political media is biased, right? I certainly hope no one is debating this anymore.  The sports media is actually even further to the left. Which is why a moderately-left guy like Clay Travis can build quite a following in sports-media by not kowtowing to the “I Hate America” crowd. 

But the financial media is different, right? 

NO!  They are just as biased as any other media.  Unfortunately, many Americans fall for their nonsense and continue to work in crappy, old jobs longer than they should because of a fear of running out of money in retirement. Take this recent article from Fortune, for instance. ‘The new rule of thumb is $3 million’: Retirement planners have some sobering advice about how much you’ll need to save’.

This, my friends, is just one of many articles that all scream the same thing: “You don’t have enough money to retire!”  And they’ve been screaming this for years. Reminds one of the climate fraudsters actually. Isn’t Miami supposed to be underwater by now? Hmmmm…

Let’s dissect why this is nonsense. What is the median Household income in the United States today? It’s around $62k a year.  The median means half the Households in the U.S. make less than $62k and half make more. Thus a household making $100,000 income in the US is well above the median, right? Of course. So, let’s say YOUR household has $100k a year income as you grind away at your crappy, old job.  How much of that $100k are you actually bringing home?

Well, you’re going to lose 7.65% right out the gate to FICA.   You’ll also have income taxes to pay to the Feds and your state. 

If you’re married filing jointly and under the age of 65 you’ll have a Standard Deduction of $24,800. Unless you have HUGE mortgage interest, tithing and various other deductions your Taxable Income in this case will be $76,200.Your total income tax to the Feds will be roughly $8,700.  If you live in the state of Georgia, as do I, you’ll pay another $5,000 or so to Governor Kemp. 

So, on that $100k GROSS income you’re living on around $80k after taxes. Oh but wait, you’re certainly saving for retirement, no? After all you need not $1, not $2, but $3 MILLION in order to retire!

We will just say you’re putting away 10% of your income. That will save about $2k in income taxes but from a NET cash flow perspective you still have $8k less a year to consume while you’re working.  This means out of $100k gross income you’re actually only bringing home around $72k. 

Don’t forget you probably have a mortgage.  We’ll just say you have a typical 3/2 1500’ home in a typical suburb. Median home values in the U.S. are around $250k.   Let’s say you live in Fulton County, GA.  Property tax on that home will probably run you $3k a year. Homeowners insurance another $1,500 or so.   Those expenses will stay with you in retirement. But you know what expense won’t? Principal and Interest on your mortgage.  For every $100k you borrow it will run you a bit more than $500 a month in principal and interest. 

Assuming you borrowed $200k for your home your P&I (principal and interest) is around $1k a month, or $12k a year.  We obviously need to deduct that $12k a year from the $72k we’re bringing home and suddenly we’re only netting $60k a year after taxes, retirement contributions and mortgage payments.

Hmmm…this is getting interesting, no? Say you have a daughter at GA Tech, as I do. Say you have other kids that cost money for sports, school, broken bones, braces, eyeglasses, never mind more tuition, as I do.  You don’t even want to know how much all that costs. But for simplicity we’ll just say it costs $10k a year to raise your children.  

Now, that $60k you’re netting is actually down to $50k.  

So, $50k is what you are actually living on, even though you gross $100k.  Oh, I hear you now, “But Josh, even if this is correct, according to the 4% rule we’ll still need $1.25 MILLION!” 

No, no you don’t.  I won’t get into why I don’t follow the 4% rule here, simply because we won’t need to go that deep in this analysis to prove you don’t need 7 figures to retire. I’ll just have you look at your Social Security statement to get a glimpse of how much you’ll receive in benefits. 

If you made the inflation-adjusted amount of $100k for the bulk of your working career, the Social Security Administration calls this indexing, you’ll get $2,790 at your Full Retirement Age (FRA). Your FRA is 67 if you were born after 1959. Born before 1960 and your FRA is 66 and some months. 

Remember, you are married too. Your spouse will get no less than HALF of your Social Security benefit at her FRA, depending on what her own benefit is.   In this scenario, assume she stayed home to raise the kids, as my wife did, and worked sparingly, her benefit will be $1,395, half of yours.  

Add your $2,790 benefit to her $1,395 and you get a monthly benefit of VOILA! $4,185. Oddly, $4,185 puts as right at an income of $50k a year. Amazing, huh?  Needless to say, if your only income is Social Security you pay no income tax either. So, taxes are a non issue in this scenario. 

We’ve already established that after taxes, mortgage, kids and retirement savings your spending is $50k a year and magically your Social Security income is also $50k a year.  “But Josh Social Security is going bankrupt!”  

No, no it’s not. 

“But Josh, Social Security will only pay 77 cents on the dollar in 2034.”

Is that true? Have you actually read the Trustees report to see what assumptions they’re using?  Let’s just say there is a lot to be optimistic about relative to what you hear from the doomsayers.

But even if true, tell me exactly when the government has actually taken MONEY away from the most reliable voting bloc in the nation, retirees.   I’d love to see that. I’d also love to see what happened to that politician who advocated such a proposal. 

Only thing I can think of is Dan Rostenkowski. To say the least, no one’s Social Security benefit has been cut. 

But hey if you think our politicians are actually going to TAKE MONEY AWAY FROM VOTERS I’d be happy to make a wager. Just get in line behind those who I’ve offered to purchase their beachfront homes for half price due to their fear of sea level rising. 

In the meantime, don’t listen to the media with their doomsday declarations.  They are either ignorant of reality or they’re deliberately lying. When it comes to the media, well it would not surprise me if they were both.

© Copyright 2018 Heritage Wealth Planning