Up Your Financial Game With These Books

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.

These books made me the financial planner I am today…

Watch this video I did earlier where I tell you my story of some of the financial planning books which made me as a financial planner.   Without these books, and thus the confidence that came from the reading AND understanding, I would not be here today.

Giving advice takes confidence.  Which is one of the frustrating things I have about the “advice” industry.  It seems very few “advisors” actually provide advice.   It’s more…”you could do this…you could do that.”
When it comes to investments, I kind of understand that, as the regulatory bodies would be on you like white on rice if just one person were to hear when you said DON’T BUY STOCKS as BUY STOCKS.

I can see it now… in a hearing with the regulators…

“Mr. Scandlen.  Did you actually say to your Youtube audience to ‘buy stocks’?

“No. I said “don’t buy stocks.”

“So you DID say “buy stocks” then.”

“No. I said “DON’T buy stocks”.”

“Mr. Scandlen.  You’re under oath.  Can you say “Don’t Buy Stocks” without actually saying “buy stocks”?

“Huh?”

“Well, you actually DID say “buy stocks” when you said “don’t buy stocks” did you not?”

Me.  “You’re joking right?”

“No. We don’t joke here.”

Judge: “Court finds in favor of the prosecution! Mr. Scandlen needs to pay for the pain and suffering of the person who watched his Youtube video for losing money in the stock market due to his saying to ‘buy stocks.”

You think something like that can’t happen?  Oh, my naive friends, how little you know about our industry.  Just go here, to the SEC Investment Advisor Public Disclosure website and look at the disclosure I have. Having a disclosure is the near equivalent of having the FBI prosecute you.  No matter your innocence or guilt, you’re guilty.

If you read my disclosure you will see why I hold the industry and its regulatory bodies in such contempt.  I could not get a job in the industry once this disclosure came on my record.
(That’s actually not true. I’m sure I could have got a job at some sketchy firm but I’d have to dance as soft-footed as a a ballerina.  And, frankly, that’s not my style which is why I could have never made it in sniper school. I’m loud and not very agile, believe it or not.)

Anyway, back to advice.  Because so many advisors are trained on investments and investments only, they have nothing to offer as far as real, actionable advice.  They can’t give specifics on investments without the regulators coming down on them and they simply don’t know much about other areas of financial planning to offer anything of value.

“Do you have ANY thoughts on Roth conversions before I take Social Security?”

“We aren’t tax advisors…see your tax guy.”   Wow. Thanks buddy…

But once you get your nose in a book or 10, you begin to see that you do have something to offer.  You begin to see commonalities of mistakes people make, time and again.  And thus you begin to see YOU have ideas to help them stop making those daggum mistakes!  Don’t follow the orthodox because the orthodox is wrong…a lot!

Modern Portfolio Theory?  BWHAHAHAHA.  Just because everyone has fallen for that hook, line and sinker doesn’t mean YOU should!

But how would you know this stuff?

And thus we go back to upping your game of financial knowledge.  Now be advised if you buy any of these books I, yes your ole buddy Josh, get a 10% commission.  I want to be very clear here. DO NOT BUY THESE IF YOU THINK I AM ONLY TRYING TO SELL YOU SOMETHING!!!  I literally could care less.

But if I can get paid to introduce you to something that has benefited me for almost 25 years, why the heck would I not do that?

So, for those who don’t click on the video I will link to the various books you should consider down below.
I can not speak to your happiness, your satisfaction, or your ability to understand the info if you make any purchase here.  But, for me, these  books and many others like them, were life changing.

Blessings,

Josh

2020 Tax Facts Individuals & Small Business –
The Tools & Techniques of Income Tax Planning, 6th Edition –
The Tools & Techniques of Investment Planning 
2020 Healthcare Reform Facts –
The Tools & Techniques of Estate Planning for Modern Families –
The Tools & Techniques of Estate Planning, 19th Edition –
The Tools & Techniques of Trust Planning –
The Tools & Techniques of Charitable Planning –
The Tools & Techniques of Life Insurance Planning –

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