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Dave Ramsey’s Retirement Planning Advice Is Flawed: Here is How

Dave Ramsey is fantastic if you are needing some 
simple financial help to get out of debt maybe   you've been irresponsible with your money you've 
racked up toxic Consumer Debt and you're looking   to implement some basic strategies to eliminate 
that debt and to create new habits for yourself   when it comes to your money Dave has impacted 
millions of people when it comes to getting out   of debt when it comes to understanding money on a 
very basic level uh in a better way the challenge   is what has happened is Dave has helped millions 
of people get out of debt and in that process he's   built a lot of trust up with that people and so 
then therefore they start listening to him for   retirement advice for planning for the retirement 
future and in this video what I'm going to do is   I'm going to cover the flaw the major flaw that 
is in Dave Ramsey's retirement strategies I'm   not gonna argue whether he's right or wrong 
about returns but I am going to point out the   massive flaw that most people are missing that 
he never talks about can't wait to get into it   if you haven't already make sure you subscribe and 
hit the Bell that way you're notified every time   I launch a new video Let's Go hey what's going 
on cash flow hackers it's Chris with life 180.   if you've been watching this channel a while you 
know how I feel about Dave Ramsey um but I want   to kind of take the conversation about Dave to 
a little bit of a different level in this video   um here's the deal Dave is really good when it 
helps you when it comes to helping you get out   of debt but his advice on retirement planning 
is is absolutely in my opinion atrocious one of   the biggest challenges that I have about Dave and 
his strategies is that he's been singing the same   song for 30 years right he has not changed his 
philosophies his strategies he hasn't really even   changed the numbers that he uses when it comes to 
retirement planning and the expectations that you   should have around your entire your retirement 
planning even though the economic environment   has changed metamorphically right so if you 
understand that there are variables that impact   your money and impact what you can expect in 
retirement you have to understand that there are   no simple rules that Dave tries to tell you like 
Dave tries to tell you to follow to execute now   I will say um that you know the advice Dave gives 
is like it's better than nothing like that I will   say it's better than doing nothing and it's better 
than what most people do but I also believe that   it's it's a problem that if you follow his advice 
expecting a certain result and then you get to the   end of the rainbow and there's no pot of gold and 
you're actually not anywhere near you where you   thought you'd be that's going to be a problem once 
again we're not talking about the debt elimination   stuff we're talking about which by the way is a 
phenomenal thing to understand that and get out   of debt like so from that perspective I applaud 
him now moving forward when we're talking about   wealth creation that's where he falls down when 
it comes to retirement planning what I did is I   built a spreadsheet because I think numbers say 
a million words spreadsheet you know we can go   through this and what I'm going to do is I'm going 
to share this so here's what I wanted to do here   I wanted to take a look at a household income 
of about a hundred thousand dollars in today's   money I want to save 15 of that income annually 
I'm going to assume an expected return of 10 per   year okay so what this does is like Dave is going 
to sit here and talk about the fact that you need   to save money based on retirement you need to to 
Target retirement account values based on your   hundred thousand dollars a year of income the 
challenge is Dave doesn't take into this into   account when he's ever talking about it I don't 
know why either I don't know why if he if he   thinks people just aren't smart enough to figure 
it out but to me this is just basic Financial   stuff that you need to know the understanding 
of you need to understand to be able to make an   educated decision if you don't understand how in 
inflation impacts your financial needs long term   you're never going to be able to make a good 
financial decision and especially that we're   in this environment right now where inflation is 
4.9 percent last year it was over nine percent   long term since 1971 inflation has been over 
four percent actually nearing four and a half   percent so like from that perspective looking at 
it from a long-term historical average this 4.9   inflation environment that we're in right now that 
everybody's freaking out about is not even high   it's just a little bit above average now a lot of 
people would argue that inflation is actually way   worse than what we're talking about right now 
because the actual impact on the calculation of   inflation uh the the impact is is much greater and 
worse on individual households uh than what the   calculation says because they've actually changed 
the calculation over the past 40 years on how they   determine the inflation numbers which to me is 
Criminal on its own but here's the deal we have uh   we have the hundred thousand dollars of income so 
what I have over here is I have um the retirement   account balance needed to live with a four percent 
rule so if you don't know what the four percent   rule is it's the rule of thumb that says you can 
distribute four percent of your retirement account   value and not run a significant risk of running 
out of money during your lifetime so that is like   the safe distribution calculation expectation so 
what this is showing is that if you had a hundred   thousand dollars of income you need 2.6 million 
dollars um actually it's a hundred four thousand I   didn't do it for year one if you get to year two 
and um you know your real need on four percent   inflation is going to be a hundred four thousand 
because your cost of living with inflation going   up it means you're going to need more money 
it needs your hundred four thousand dollars   next year with four percent inflation is gonna 
feel like a hundred thousand dollars of income   Fields today the challenge is household income 
historically is only going up in about three   percent so it's lagging actual inflation and this 
is why the middle class and the poor are getting   poor and there's this growing divide between the 
wealthy and the middle class it's not so much   other economic policies even though that has a 
play with it long-term inflation is the greatest   tax that is hidden to the American population and 
it has a hugely negative impact uh on the middle   class and lower class the most right so ultimately 
this column is what I would call your freedom   number your freedom number is simply the amount 
of money that you need in an account to be able   to retire to be able to be completely financially 
free and so right now use using traditional four   percent rule methodology and now I'm not taking 
into account Social Security or pension or   anything of that nature so if in fact you did 
have a pension if in fact you want to lean on   social security for any reason you'd have to look 
at your calculation and reduce those off of this   number and then you divide that by four percent 
and that will give you uh this number so if you   said let's say you had fifty four thousand dollars 
of pension and social security you'd subtract that   out that'd be fifty thousand divided by uh divided 
by the uh four percent and that would get you what   your uh Freedom number would be it would tell you 
how much money you need in that account to be able   to kick off passive income for you for the rest 
of your life now here's the challenge as I said   household income is only going up at three percent 
and Dave is saying hey you need to save 15 even if   we earn 10 which is by the way wildly unrealistic 
right I'm showing this at at 10 and it shows you   at 6.561 million here but really that's because 
of the fact that it's assuming that you're going   to have a 281 thousand dollar uh need for annual 
income now here's the deal your income is going   up at three percent per year that 283 35 years 
from now because I'm assuming it's a 35 year old   retiring at 65.

Dave doesn't talk about the fact 
that if you earn 100 Grand right now you're going   to need 281 to be able to maintain your standard 
of living that's not 281 000 in today's money   that's 281 000 in future money right I just did 
a video the other day talking about uh inflation   and the inflation crisis and ultimately how that's 
going to impact you um and and how that's like the   history of this inflation and and where it looks 
what it looks like moving forward into the future   um but this 281 by the way is assuming only 
a three percent increase at a four percent   historical average of inflation if we look at 
it that way you're going to actually need 394   000 and if you back that out you're going to need 
9 million 865 000 and the problem is all of your   Social Security cost of living adjustments cost 
of living increases they don't keep up with the   actual rate of inflation so the need for you 
to take more responsibility for your retirement   planning is becoming greater and greater and 
greater and as as inflation keeps going up this is   a way if you think about it from a social security 
perspective this is a way that the government's   able to kind of save Social Security if they 
can inflate the currency of four percent and   devalue the currency but then only give you cost 
of living adjustments at two percent that means   they're recapturing that money and saving the 
program simply by the way they're doing that but   ultimately they're stealing that money from you 
through a hidden tax the problem is Dave doesn't   talk about all this and what he does is he talks 
about your need for this money he talks about   saving a million dollars and I got news for you 
you could save three million dollars and if you   get to uh retirement and you have three million 
dollars but you need to live on 281 000 a year   you are going to be up the creek without a paddle 
you're not going to be prepared and you're not   going to be in a position um you know ultimately 
where you're you know going to be able to uh   have a a solid situation you know that's that's 
really what it comes down to you're not going   to have any kind of predictable income you're not 
going to have any stability uh you know and you're   ultimately going to have a lot of risk especially 
when it comes to Market risk sequence of return   risk and and just Market volatility risk when 
it comes to your retirement if you if you follow   his plan you're going to be under saved when it 
comes to retirement simply because you didn't give   enough credibility to the impact that inflation 
is going to have on your future needs because   think about it this way everything I just showed 
you was a 10 assumption I could show you a lot of   ways that 10 is completely unrealistic especially 
when you talk about actual real returns I would   say six to eight percent is is the more realistic 
expectation and even then there's some risk   involved right so if we if we back that out what 
what that would look like at even eight percent   which is I think the more I guess traditional 
method that most financial advisors would say   you could get from a long-term perspective if 
you look at eight percent you're only going to   have just over four million dollars that's about 
at retirement 35 years from now for a 30 year old   right when you hit 65 so in that scenario you're 
still looking at only accumulating about half of   the money that you're going to need just to 
maintain your standard of living I don't care   how much you have in Social Security or pension 
it's probably not going to make up that Gap   and you're going to have to take a reduction in 
standard of living even if you follow his advice   and have no car payment and have no mortgage or 
anything like that it that that doesn't matter   that that's not gonna make up for the Gap that in 
inflation has caused for a problem for you and so   that's something that you need to consider so my 
encouragement to you is to go through your plan   figure out what inflation is going to do to your 
retirement planning needs and if you want help   with this I've got a team I've got a certified 
financial planner on the team that's happy to walk   through this give you a consultation walk through 
your needs walk through your current plan and and   give you an analysis and an evaluation on what you 
need to do moving forward to reach your goals on   a predictable basis one of the things I always 
ask I always ask people four questions first and   foremost doing what you're currently doing do you 
know what rate of return your money needs to earn   to be able to retire when you want and guarantee 
your standard of living for the rest of your life   if you don't know the answer to that question then 
everything else is going to blow up you can't plan   accordingly if you don't know the answer to 
that question second question is if you if you   don't know that number the question is do you know 
how much more money you have to save to be able   to retire at your desired standard of living and 
be able to retire when you want and if you don't   know the answer to that which most people don't 
I've literally met one person in my life that   actually knew those numbers ahead of time then 
you start backing it out and go okay how much   longer are you going to have to work if you get 
to retirement age and you haven't met that and you   still need to work well a lot of people they have 
to work an extra decade just to make it make ends   meet right people are thinking they're going to be 
able to retire at 65 but they have to work till 75   or 77 or 78 it's it's really just a sad situation 
but then the challenges our health a lot of times   sometimes sadly unfortunately fails on us we don't 
when you hit 65 there's no there's no promises   there's no guarantees heck there's no guarantees 
anyway but especially when you hit 65 our health   starts to fail like and for most Americans most 
people in this world Health starts to decline at   least and there's start to be different needs our 
bodies break down maybe your body isn't going to   be as capable of doing the job that you did for 
all those years to earn your income and so now   you have to start being like even if I wanted to 
keep working what is my real earning potential am   I really going to keep being able to do that or 
if I get sick what kind of reduction in standard   of living am I going to have to take just to be 
able to last the rest of my life and not run out   of money right and so these are the things that 
you need to consider if you haven't already like   I would encourage you to really do a deep dive 
because my favorite favorite quote in the world   I think and it's kind of tongue-in-cheek but just 
because the ostrich buries his head in the sand   doesn't mean the Lion's Den or plans have changed 
right this this is your problem this retirement   thing is a real problem it's a it's a thing that 
you need to figure out a solution to and you need   to create a plan for as good as Dave is at helping 
you get out of debt he's not great at helping   you plan for your future um and and his his 
information while it seems great because it's kind   of geared towards the masses it's actually in my 
opinion it's it's super detrimental to most people   that are listening to them because you're going to 
get to the end of the rainbow there's a going to   be no pot of gold you're going to find out you got 
to work longer if you're healthy enough to do so   or you're going to have to reduce your standard 
of living because you didn't take some of these   variables into consideration so anyway hopefully 
you found value in that if you did please like it   share it get it out there to people subscribe 
hit the Bell that way you're notified every   time I launch a new video until next time have a 
blessed inspirational day we'll talk soon see you

As found on YouTube

Retirement Planning Home

Read More

Dave Ramsey’s Retirement Planning Advice Is Flawed: Here is How

Dave Ramsey is fantastic if you are needing some 
simple financial help to get out of debt maybe   you've been irresponsible with your money you've 
racked up toxic Consumer Debt and you're looking   to implement some basic strategies to eliminate 
that debt and to create new habits for yourself   when it comes to your money Dave has impacted 
millions of people when it comes to getting out   of debt when it comes to understanding money on a 
very basic level uh in a better way the challenge   is what has happened is Dave has helped millions 
of people get out of debt and in that process he's   built a lot of trust up with that people and so 
then therefore they start listening to him for   retirement advice for planning for the retirement 
future and in this video what I'm going to do is   I'm going to cover the flaw the major flaw that 
is in Dave Ramsey's retirement strategies I'm   not gonna argue whether he's right or wrong 
about returns but I am going to point out the   massive flaw that most people are missing that 
he never talks about can't wait to get into it   if you haven't already make sure you subscribe and 
hit the Bell that way you're notified every time   I launch a new video Let's Go hey what's going 
on cash flow hackers it's Chris with life 180.   if you've been watching this channel a while you 
know how I feel about Dave Ramsey um but I want   to kind of take the conversation about Dave to 
a little bit of a different level in this video   um here's the deal Dave is really good when it 
helps you when it comes to helping you get out   of debt but his advice on retirement planning 
is is absolutely in my opinion atrocious one of   the biggest challenges that I have about Dave and 
his strategies is that he's been singing the same   song for 30 years right he has not changed his 
philosophies his strategies he hasn't really even   changed the numbers that he uses when it comes to 
retirement planning and the expectations that you   should have around your entire your retirement 
planning even though the economic environment   has changed metamorphically right so if you 
understand that there are variables that impact   your money and impact what you can expect in 
retirement you have to understand that there are   no simple rules that Dave tries to tell you like 
Dave tries to tell you to follow to execute now   I will say um that you know the advice Dave gives 
is like it's better than nothing like that I will   say it's better than doing nothing and it's better 
than what most people do but I also believe that   it's it's a problem that if you follow his advice 
expecting a certain result and then you get to the   end of the rainbow and there's no pot of gold and 
you're actually not anywhere near you where you   thought you'd be that's going to be a problem once 
again we're not talking about the debt elimination   stuff we're talking about which by the way is a 
phenomenal thing to understand that and get out   of debt like so from that perspective I applaud 
him now moving forward when we're talking about   wealth creation that's where he falls down when 
it comes to retirement planning what I did is I   built a spreadsheet because I think numbers say 
a million words spreadsheet you know we can go   through this and what I'm going to do is I'm going 
to share this so here's what I wanted to do here   I wanted to take a look at a household income 
of about a hundred thousand dollars in today's   money I want to save 15 of that income annually 
I'm going to assume an expected return of 10 per   year okay so what this does is like Dave is going 
to sit here and talk about the fact that you need   to save money based on retirement you need to to 
Target retirement account values based on your   hundred thousand dollars a year of income the 
challenge is Dave doesn't take into this into   account when he's ever talking about it I don't 
know why either I don't know why if he if he   thinks people just aren't smart enough to figure 
it out but to me this is just basic Financial   stuff that you need to know the understanding 
of you need to understand to be able to make an   educated decision if you don't understand how in 
inflation impacts your financial needs long term   you're never going to be able to make a good 
financial decision and especially that we're   in this environment right now where inflation is 
4.9 percent last year it was over nine percent   long term since 1971 inflation has been over 
four percent actually nearing four and a half   percent so like from that perspective looking at 
it from a long-term historical average this 4.9   inflation environment that we're in right now that 
everybody's freaking out about is not even high   it's just a little bit above average now a lot of 
people would argue that inflation is actually way   worse than what we're talking about right now 
because the actual impact on the calculation of   inflation uh the the impact is is much greater and 
worse on individual households uh than what the   calculation says because they've actually changed 
the calculation over the past 40 years on how they   determine the inflation numbers which to me is 
Criminal on its own but here's the deal we have uh   we have the hundred thousand dollars of income so 
what I have over here is I have um the retirement   account balance needed to live with a four percent 
rule so if you don't know what the four percent   rule is it's the rule of thumb that says you can 
distribute four percent of your retirement account   value and not run a significant risk of running 
out of money during your lifetime so that is like   the safe distribution calculation expectation so 
what this is showing is that if you had a hundred   thousand dollars of income you need 2.6 million 
dollars um actually it's a hundred four thousand I   didn't do it for year one if you get to year two 
and um you know your real need on four percent   inflation is going to be a hundred four thousand 
because your cost of living with inflation going   up it means you're going to need more money 
it needs your hundred four thousand dollars   next year with four percent inflation is gonna 
feel like a hundred thousand dollars of income   Fields today the challenge is household income 
historically is only going up in about three   percent so it's lagging actual inflation and this 
is why the middle class and the poor are getting   poor and there's this growing divide between the 
wealthy and the middle class it's not so much   other economic policies even though that has a 
play with it long-term inflation is the greatest   tax that is hidden to the American population and 
it has a hugely negative impact uh on the middle   class and lower class the most right so ultimately 
this column is what I would call your freedom   number your freedom number is simply the amount 
of money that you need in an account to be able   to retire to be able to be completely financially 
free and so right now use using traditional four   percent rule methodology and now I'm not taking 
into account Social Security or pension or   anything of that nature so if in fact you did 
have a pension if in fact you want to lean on   social security for any reason you'd have to look 
at your calculation and reduce those off of this   number and then you divide that by four percent 
and that will give you uh this number so if you   said let's say you had fifty four thousand dollars 
of pension and social security you'd subtract that   out that'd be fifty thousand divided by uh divided 
by the uh four percent and that would get you what   your uh Freedom number would be it would tell you 
how much money you need in that account to be able   to kick off passive income for you for the rest 
of your life now here's the challenge as I said   household income is only going up at three percent 
and Dave is saying hey you need to save 15 even if   we earn 10 which is by the way wildly unrealistic 
right I'm showing this at at 10 and it shows you   at 6.561 million here but really that's because 
of the fact that it's assuming that you're going   to have a 281 thousand dollar uh need for annual 
income now here's the deal your income is going   up at three percent per year that 283 35 years 
from now because I'm assuming it's a 35 year old   retiring at 65.

Dave doesn't talk about the fact 
that if you earn 100 Grand right now you're going   to need 281 to be able to maintain your standard 
of living that's not 281 000 in today's money   that's 281 000 in future money right I just did 
a video the other day talking about uh inflation   and the inflation crisis and ultimately how that's 
going to impact you um and and how that's like the   history of this inflation and and where it looks 
what it looks like moving forward into the future   um but this 281 by the way is assuming only 
a three percent increase at a four percent   historical average of inflation if we look at 
it that way you're going to actually need 394   000 and if you back that out you're going to need 
9 million 865 000 and the problem is all of your   Social Security cost of living adjustments cost 
of living increases they don't keep up with the   actual rate of inflation so the need for you 
to take more responsibility for your retirement   planning is becoming greater and greater and 
greater and as as inflation keeps going up this is   a way if you think about it from a social security 
perspective this is a way that the government's   able to kind of save Social Security if they 
can inflate the currency of four percent and   devalue the currency but then only give you cost 
of living adjustments at two percent that means   they're recapturing that money and saving the 
program simply by the way they're doing that but   ultimately they're stealing that money from you 
through a hidden tax the problem is Dave doesn't   talk about all this and what he does is he talks 
about your need for this money he talks about   saving a million dollars and I got news for you 
you could save three million dollars and if you   get to uh retirement and you have three million 
dollars but you need to live on 281 000 a year   you are going to be up the creek without a paddle 
you're not going to be prepared and you're not   going to be in a position um you know ultimately 
where you're you know going to be able to uh   have a a solid situation you know that's that's 
really what it comes down to you're not going   to have any kind of predictable income you're not 
going to have any stability uh you know and you're   ultimately going to have a lot of risk especially 
when it comes to Market risk sequence of return   risk and and just Market volatility risk when 
it comes to your retirement if you if you follow   his plan you're going to be under saved when it 
comes to retirement simply because you didn't give   enough credibility to the impact that inflation 
is going to have on your future needs because   think about it this way everything I just showed 
you was a 10 assumption I could show you a lot of   ways that 10 is completely unrealistic especially 
when you talk about actual real returns I would   say six to eight percent is is the more realistic 
expectation and even then there's some risk   involved right so if we if we back that out what 
what that would look like at even eight percent   which is I think the more I guess traditional 
method that most financial advisors would say   you could get from a long-term perspective if 
you look at eight percent you're only going to   have just over four million dollars that's about 
at retirement 35 years from now for a 30 year old   right when you hit 65 so in that scenario you're 
still looking at only accumulating about half of   the money that you're going to need just to 
maintain your standard of living I don't care   how much you have in Social Security or pension 
it's probably not going to make up that Gap   and you're going to have to take a reduction in 
standard of living even if you follow his advice   and have no car payment and have no mortgage or 
anything like that it that that doesn't matter   that that's not gonna make up for the Gap that in 
inflation has caused for a problem for you and so   that's something that you need to consider so my 
encouragement to you is to go through your plan   figure out what inflation is going to do to your 
retirement planning needs and if you want help   with this I've got a team I've got a certified 
financial planner on the team that's happy to walk   through this give you a consultation walk through 
your needs walk through your current plan and and   give you an analysis and an evaluation on what you 
need to do moving forward to reach your goals on   a predictable basis one of the things I always 
ask I always ask people four questions first and   foremost doing what you're currently doing do you 
know what rate of return your money needs to earn   to be able to retire when you want and guarantee 
your standard of living for the rest of your life   if you don't know the answer to that question then 
everything else is going to blow up you can't plan   accordingly if you don't know the answer to 
that question second question is if you if you   don't know that number the question is do you know 
how much more money you have to save to be able   to retire at your desired standard of living and 
be able to retire when you want and if you don't   know the answer to that which most people don't 
I've literally met one person in my life that   actually knew those numbers ahead of time then 
you start backing it out and go okay how much   longer are you going to have to work if you get 
to retirement age and you haven't met that and you   still need to work well a lot of people they have 
to work an extra decade just to make it make ends   meet right people are thinking they're going to be 
able to retire at 65 but they have to work till 75   or 77 or 78 it's it's really just a sad situation 
but then the challenges our health a lot of times   sometimes sadly unfortunately fails on us we don't 
when you hit 65 there's no there's no promises   there's no guarantees heck there's no guarantees 
anyway but especially when you hit 65 our health   starts to fail like and for most Americans most 
people in this world Health starts to decline at   least and there's start to be different needs our 
bodies break down maybe your body isn't going to   be as capable of doing the job that you did for 
all those years to earn your income and so now   you have to start being like even if I wanted to 
keep working what is my real earning potential am   I really going to keep being able to do that or 
if I get sick what kind of reduction in standard   of living am I going to have to take just to be 
able to last the rest of my life and not run out   of money right and so these are the things that 
you need to consider if you haven't already like   I would encourage you to really do a deep dive 
because my favorite favorite quote in the world   I think and it's kind of tongue-in-cheek but just 
because the ostrich buries his head in the sand   doesn't mean the Lion's Den or plans have changed 
right this this is your problem this retirement   thing is a real problem it's a it's a thing that 
you need to figure out a solution to and you need   to create a plan for as good as Dave is at helping 
you get out of debt he's not great at helping   you plan for your future um and and his his 
information while it seems great because it's kind   of geared towards the masses it's actually in my 
opinion it's it's super detrimental to most people   that are listening to them because you're going to 
get to the end of the rainbow there's a going to   be no pot of gold you're going to find out you got 
to work longer if you're healthy enough to do so   or you're going to have to reduce your standard 
of living because you didn't take some of these   variables into consideration so anyway hopefully 
you found value in that if you did please like it   share it get it out there to people subscribe 
hit the Bell that way you're notified every   time I launch a new video until next time have a 
blessed inspirational day we'll talk soon see you

As found on YouTube

Retirement Planning Home

Read More

Dave Ramsey’s Retirement Planning Advice Is Flawed: Here is How

Dave Ramsey is fantastic if you are needing some 
simple financial help to get out of debt maybe   you've been irresponsible with your money you've 
racked up toxic Consumer Debt and you're looking   to implement some basic strategies to eliminate 
that debt and to create new habits for yourself   when it comes to your money Dave has impacted 
millions of people when it comes to getting out   of debt when it comes to understanding money on a 
very basic level uh in a better way the challenge   is what has happened is Dave has helped millions 
of people get out of debt and in that process he's   built a lot of trust up with that people and so 
then therefore they start listening to him for   retirement advice for planning for the retirement 
future and in this video what I'm going to do is   I'm going to cover the flaw the major flaw that 
is in Dave Ramsey's retirement strategies I'm   not gonna argue whether he's right or wrong 
about returns but I am going to point out the   massive flaw that most people are missing that 
he never talks about can't wait to get into it   if you haven't already make sure you subscribe and 
hit the Bell that way you're notified every time   I launch a new video Let's Go hey what's going 
on cash flow hackers it's Chris with life 180.   if you've been watching this channel a while you 
know how I feel about Dave Ramsey um but I want   to kind of take the conversation about Dave to 
a little bit of a different level in this video   um here's the deal Dave is really good when it 
helps you when it comes to helping you get out   of debt but his advice on retirement planning 
is is absolutely in my opinion atrocious one of   the biggest challenges that I have about Dave and 
his strategies is that he's been singing the same   song for 30 years right he has not changed his 
philosophies his strategies he hasn't really even   changed the numbers that he uses when it comes to 
retirement planning and the expectations that you   should have around your entire your retirement 
planning even though the economic environment   has changed metamorphically right so if you 
understand that there are variables that impact   your money and impact what you can expect in 
retirement you have to understand that there are   no simple rules that Dave tries to tell you like 
Dave tries to tell you to follow to execute now   I will say um that you know the advice Dave gives 
is like it's better than nothing like that I will   say it's better than doing nothing and it's better 
than what most people do but I also believe that   it's it's a problem that if you follow his advice 
expecting a certain result and then you get to the   end of the rainbow and there's no pot of gold and 
you're actually not anywhere near you where you   thought you'd be that's going to be a problem once 
again we're not talking about the debt elimination   stuff we're talking about which by the way is a 
phenomenal thing to understand that and get out   of debt like so from that perspective I applaud 
him now moving forward when we're talking about   wealth creation that's where he falls down when 
it comes to retirement planning what I did is I   built a spreadsheet because I think numbers say 
a million words spreadsheet you know we can go   through this and what I'm going to do is I'm going 
to share this so here's what I wanted to do here   I wanted to take a look at a household income 
of about a hundred thousand dollars in today's   money I want to save 15 of that income annually 
I'm going to assume an expected return of 10 per   year okay so what this does is like Dave is going 
to sit here and talk about the fact that you need   to save money based on retirement you need to to 
Target retirement account values based on your   hundred thousand dollars a year of income the 
challenge is Dave doesn't take into this into   account when he's ever talking about it I don't 
know why either I don't know why if he if he   thinks people just aren't smart enough to figure 
it out but to me this is just basic Financial   stuff that you need to know the understanding 
of you need to understand to be able to make an   educated decision if you don't understand how in 
inflation impacts your financial needs long term   you're never going to be able to make a good 
financial decision and especially that we're   in this environment right now where inflation is 
4.9 percent last year it was over nine percent   long term since 1971 inflation has been over 
four percent actually nearing four and a half   percent so like from that perspective looking at 
it from a long-term historical average this 4.9   inflation environment that we're in right now that 
everybody's freaking out about is not even high   it's just a little bit above average now a lot of 
people would argue that inflation is actually way   worse than what we're talking about right now 
because the actual impact on the calculation of   inflation uh the the impact is is much greater and 
worse on individual households uh than what the   calculation says because they've actually changed 
the calculation over the past 40 years on how they   determine the inflation numbers which to me is 
Criminal on its own but here's the deal we have uh   we have the hundred thousand dollars of income so 
what I have over here is I have um the retirement   account balance needed to live with a four percent 
rule so if you don't know what the four percent   rule is it's the rule of thumb that says you can 
distribute four percent of your retirement account   value and not run a significant risk of running 
out of money during your lifetime so that is like   the safe distribution calculation expectation so 
what this is showing is that if you had a hundred   thousand dollars of income you need 2.6 million 
dollars um actually it's a hundred four thousand I   didn't do it for year one if you get to year two 
and um you know your real need on four percent   inflation is going to be a hundred four thousand 
because your cost of living with inflation going   up it means you're going to need more money 
it needs your hundred four thousand dollars   next year with four percent inflation is gonna 
feel like a hundred thousand dollars of income   Fields today the challenge is household income 
historically is only going up in about three   percent so it's lagging actual inflation and this 
is why the middle class and the poor are getting   poor and there's this growing divide between the 
wealthy and the middle class it's not so much   other economic policies even though that has a 
play with it long-term inflation is the greatest   tax that is hidden to the American population and 
it has a hugely negative impact uh on the middle   class and lower class the most right so ultimately 
this column is what I would call your freedom   number your freedom number is simply the amount 
of money that you need in an account to be able   to retire to be able to be completely financially 
free and so right now use using traditional four   percent rule methodology and now I'm not taking 
into account Social Security or pension or   anything of that nature so if in fact you did 
have a pension if in fact you want to lean on   social security for any reason you'd have to look 
at your calculation and reduce those off of this   number and then you divide that by four percent 
and that will give you uh this number so if you   said let's say you had fifty four thousand dollars 
of pension and social security you'd subtract that   out that'd be fifty thousand divided by uh divided 
by the uh four percent and that would get you what   your uh Freedom number would be it would tell you 
how much money you need in that account to be able   to kick off passive income for you for the rest 
of your life now here's the challenge as I said   household income is only going up at three percent 
and Dave is saying hey you need to save 15 even if   we earn 10 which is by the way wildly unrealistic 
right I'm showing this at at 10 and it shows you   at 6.561 million here but really that's because 
of the fact that it's assuming that you're going   to have a 281 thousand dollar uh need for annual 
income now here's the deal your income is going   up at three percent per year that 283 35 years 
from now because I'm assuming it's a 35 year old   retiring at 65.

Dave doesn't talk about the fact 
that if you earn 100 Grand right now you're going   to need 281 to be able to maintain your standard 
of living that's not 281 000 in today's money   that's 281 000 in future money right I just did 
a video the other day talking about uh inflation   and the inflation crisis and ultimately how that's 
going to impact you um and and how that's like the   history of this inflation and and where it looks 
what it looks like moving forward into the future   um but this 281 by the way is assuming only 
a three percent increase at a four percent   historical average of inflation if we look at 
it that way you're going to actually need 394   000 and if you back that out you're going to need 
9 million 865 000 and the problem is all of your   Social Security cost of living adjustments cost 
of living increases they don't keep up with the   actual rate of inflation so the need for you 
to take more responsibility for your retirement   planning is becoming greater and greater and 
greater and as as inflation keeps going up this is   a way if you think about it from a social security 
perspective this is a way that the government's   able to kind of save Social Security if they 
can inflate the currency of four percent and   devalue the currency but then only give you cost 
of living adjustments at two percent that means   they're recapturing that money and saving the 
program simply by the way they're doing that but   ultimately they're stealing that money from you 
through a hidden tax the problem is Dave doesn't   talk about all this and what he does is he talks 
about your need for this money he talks about   saving a million dollars and I got news for you 
you could save three million dollars and if you   get to uh retirement and you have three million 
dollars but you need to live on 281 000 a year   you are going to be up the creek without a paddle 
you're not going to be prepared and you're not   going to be in a position um you know ultimately 
where you're you know going to be able to uh   have a a solid situation you know that's that's 
really what it comes down to you're not going   to have any kind of predictable income you're not 
going to have any stability uh you know and you're   ultimately going to have a lot of risk especially 
when it comes to Market risk sequence of return   risk and and just Market volatility risk when 
it comes to your retirement if you if you follow   his plan you're going to be under saved when it 
comes to retirement simply because you didn't give   enough credibility to the impact that inflation 
is going to have on your future needs because   think about it this way everything I just showed 
you was a 10 assumption I could show you a lot of   ways that 10 is completely unrealistic especially 
when you talk about actual real returns I would   say six to eight percent is is the more realistic 
expectation and even then there's some risk   involved right so if we if we back that out what 
what that would look like at even eight percent   which is I think the more I guess traditional 
method that most financial advisors would say   you could get from a long-term perspective if 
you look at eight percent you're only going to   have just over four million dollars that's about 
at retirement 35 years from now for a 30 year old   right when you hit 65 so in that scenario you're 
still looking at only accumulating about half of   the money that you're going to need just to 
maintain your standard of living I don't care   how much you have in Social Security or pension 
it's probably not going to make up that Gap   and you're going to have to take a reduction in 
standard of living even if you follow his advice   and have no car payment and have no mortgage or 
anything like that it that that doesn't matter   that that's not gonna make up for the Gap that in 
inflation has caused for a problem for you and so   that's something that you need to consider so my 
encouragement to you is to go through your plan   figure out what inflation is going to do to your 
retirement planning needs and if you want help   with this I've got a team I've got a certified 
financial planner on the team that's happy to walk   through this give you a consultation walk through 
your needs walk through your current plan and and   give you an analysis and an evaluation on what you 
need to do moving forward to reach your goals on   a predictable basis one of the things I always 
ask I always ask people four questions first and   foremost doing what you're currently doing do you 
know what rate of return your money needs to earn   to be able to retire when you want and guarantee 
your standard of living for the rest of your life   if you don't know the answer to that question then 
everything else is going to blow up you can't plan   accordingly if you don't know the answer to 
that question second question is if you if you   don't know that number the question is do you know 
how much more money you have to save to be able   to retire at your desired standard of living and 
be able to retire when you want and if you don't   know the answer to that which most people don't 
I've literally met one person in my life that   actually knew those numbers ahead of time then 
you start backing it out and go okay how much   longer are you going to have to work if you get 
to retirement age and you haven't met that and you   still need to work well a lot of people they have 
to work an extra decade just to make it make ends   meet right people are thinking they're going to be 
able to retire at 65 but they have to work till 75   or 77 or 78 it's it's really just a sad situation 
but then the challenges our health a lot of times   sometimes sadly unfortunately fails on us we don't 
when you hit 65 there's no there's no promises   there's no guarantees heck there's no guarantees 
anyway but especially when you hit 65 our health   starts to fail like and for most Americans most 
people in this world Health starts to decline at   least and there's start to be different needs our 
bodies break down maybe your body isn't going to   be as capable of doing the job that you did for 
all those years to earn your income and so now   you have to start being like even if I wanted to 
keep working what is my real earning potential am   I really going to keep being able to do that or 
if I get sick what kind of reduction in standard   of living am I going to have to take just to be 
able to last the rest of my life and not run out   of money right and so these are the things that 
you need to consider if you haven't already like   I would encourage you to really do a deep dive 
because my favorite favorite quote in the world   I think and it's kind of tongue-in-cheek but just 
because the ostrich buries his head in the sand   doesn't mean the Lion's Den or plans have changed 
right this this is your problem this retirement   thing is a real problem it's a it's a thing that 
you need to figure out a solution to and you need   to create a plan for as good as Dave is at helping 
you get out of debt he's not great at helping   you plan for your future um and and his his 
information while it seems great because it's kind   of geared towards the masses it's actually in my 
opinion it's it's super detrimental to most people   that are listening to them because you're going to 
get to the end of the rainbow there's a going to   be no pot of gold you're going to find out you got 
to work longer if you're healthy enough to do so   or you're going to have to reduce your standard 
of living because you didn't take some of these   variables into consideration so anyway hopefully 
you found value in that if you did please like it   share it get it out there to people subscribe 
hit the Bell that way you're notified every   time I launch a new video until next time have a 
blessed inspirational day we'll talk soon see you

As found on YouTube

Retirement Planning Home

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Dave Ramsey’s Retirement Planning Advice Is Flawed: Here is How

Dave Ramsey is fantastic if you are needing some 
simple financial help to get out of debt maybe   you've been irresponsible with your money you've 
racked up toxic Consumer Debt and you're looking   to implement some basic strategies to eliminate 
that debt and to create new habits for yourself   when it comes to your money Dave has impacted 
millions of people when it comes to getting out   of debt when it comes to understanding money on a 
very basic level uh in a better way the challenge   is what has happened is Dave has helped millions 
of people get out of debt and in that process he's   built a lot of trust up with that people and so 
then therefore they start listening to him for   retirement advice for planning for the retirement 
future and in this video what I'm going to do is   I'm going to cover the flaw the major flaw that 
is in Dave Ramsey's retirement strategies I'm   not gonna argue whether he's right or wrong 
about returns but I am going to point out the   massive flaw that most people are missing that 
he never talks about can't wait to get into it   if you haven't already make sure you subscribe and 
hit the Bell that way you're notified every time   I launch a new video Let's Go hey what's going 
on cash flow hackers it's Chris with life 180.   if you've been watching this channel a while you 
know how I feel about Dave Ramsey um but I want   to kind of take the conversation about Dave to 
a little bit of a different level in this video   um here's the deal Dave is really good when it 
helps you when it comes to helping you get out   of debt but his advice on retirement planning 
is is absolutely in my opinion atrocious one of   the biggest challenges that I have about Dave and 
his strategies is that he's been singing the same   song for 30 years right he has not changed his 
philosophies his strategies he hasn't really even   changed the numbers that he uses when it comes to 
retirement planning and the expectations that you   should have around your entire your retirement 
planning even though the economic environment   has changed metamorphically right so if you 
understand that there are variables that impact   your money and impact what you can expect in 
retirement you have to understand that there are   no simple rules that Dave tries to tell you like 
Dave tries to tell you to follow to execute now   I will say um that you know the advice Dave gives 
is like it's better than nothing like that I will   say it's better than doing nothing and it's better 
than what most people do but I also believe that   it's it's a problem that if you follow his advice 
expecting a certain result and then you get to the   end of the rainbow and there's no pot of gold and 
you're actually not anywhere near you where you   thought you'd be that's going to be a problem once 
again we're not talking about the debt elimination   stuff we're talking about which by the way is a 
phenomenal thing to understand that and get out   of debt like so from that perspective I applaud 
him now moving forward when we're talking about   wealth creation that's where he falls down when 
it comes to retirement planning what I did is I   built a spreadsheet because I think numbers say 
a million words spreadsheet you know we can go   through this and what I'm going to do is I'm going 
to share this so here's what I wanted to do here   I wanted to take a look at a household income 
of about a hundred thousand dollars in today's   money I want to save 15 of that income annually 
I'm going to assume an expected return of 10 per   year okay so what this does is like Dave is going 
to sit here and talk about the fact that you need   to save money based on retirement you need to to 
Target retirement account values based on your   hundred thousand dollars a year of income the 
challenge is Dave doesn't take into this into   account when he's ever talking about it I don't 
know why either I don't know why if he if he   thinks people just aren't smart enough to figure 
it out but to me this is just basic Financial   stuff that you need to know the understanding 
of you need to understand to be able to make an   educated decision if you don't understand how in 
inflation impacts your financial needs long term   you're never going to be able to make a good 
financial decision and especially that we're   in this environment right now where inflation is 
4.9 percent last year it was over nine percent   long term since 1971 inflation has been over 
four percent actually nearing four and a half   percent so like from that perspective looking at 
it from a long-term historical average this 4.9   inflation environment that we're in right now that 
everybody's freaking out about is not even high   it's just a little bit above average now a lot of 
people would argue that inflation is actually way   worse than what we're talking about right now 
because the actual impact on the calculation of   inflation uh the the impact is is much greater and 
worse on individual households uh than what the   calculation says because they've actually changed 
the calculation over the past 40 years on how they   determine the inflation numbers which to me is 
Criminal on its own but here's the deal we have uh   we have the hundred thousand dollars of income so 
what I have over here is I have um the retirement   account balance needed to live with a four percent 
rule so if you don't know what the four percent   rule is it's the rule of thumb that says you can 
distribute four percent of your retirement account   value and not run a significant risk of running 
out of money during your lifetime so that is like   the safe distribution calculation expectation so 
what this is showing is that if you had a hundred   thousand dollars of income you need 2.6 million 
dollars um actually it's a hundred four thousand I   didn't do it for year one if you get to year two 
and um you know your real need on four percent   inflation is going to be a hundred four thousand 
because your cost of living with inflation going   up it means you're going to need more money 
it needs your hundred four thousand dollars   next year with four percent inflation is gonna 
feel like a hundred thousand dollars of income   Fields today the challenge is household income 
historically is only going up in about three   percent so it's lagging actual inflation and this 
is why the middle class and the poor are getting   poor and there's this growing divide between the 
wealthy and the middle class it's not so much   other economic policies even though that has a 
play with it long-term inflation is the greatest   tax that is hidden to the American population and 
it has a hugely negative impact uh on the middle   class and lower class the most right so ultimately 
this column is what I would call your freedom   number your freedom number is simply the amount 
of money that you need in an account to be able   to retire to be able to be completely financially 
free and so right now use using traditional four   percent rule methodology and now I'm not taking 
into account Social Security or pension or   anything of that nature so if in fact you did 
have a pension if in fact you want to lean on   social security for any reason you'd have to look 
at your calculation and reduce those off of this   number and then you divide that by four percent 
and that will give you uh this number so if you   said let's say you had fifty four thousand dollars 
of pension and social security you'd subtract that   out that'd be fifty thousand divided by uh divided 
by the uh four percent and that would get you what   your uh Freedom number would be it would tell you 
how much money you need in that account to be able   to kick off passive income for you for the rest 
of your life now here's the challenge as I said   household income is only going up at three percent 
and Dave is saying hey you need to save 15 even if   we earn 10 which is by the way wildly unrealistic 
right I'm showing this at at 10 and it shows you   at 6.561 million here but really that's because 
of the fact that it's assuming that you're going   to have a 281 thousand dollar uh need for annual 
income now here's the deal your income is going   up at three percent per year that 283 35 years 
from now because I'm assuming it's a 35 year old   retiring at 65.

Dave doesn't talk about the fact 
that if you earn 100 Grand right now you're going   to need 281 to be able to maintain your standard 
of living that's not 281 000 in today's money   that's 281 000 in future money right I just did 
a video the other day talking about uh inflation   and the inflation crisis and ultimately how that's 
going to impact you um and and how that's like the   history of this inflation and and where it looks 
what it looks like moving forward into the future   um but this 281 by the way is assuming only 
a three percent increase at a four percent   historical average of inflation if we look at 
it that way you're going to actually need 394   000 and if you back that out you're going to need 
9 million 865 000 and the problem is all of your   Social Security cost of living adjustments cost 
of living increases they don't keep up with the   actual rate of inflation so the need for you 
to take more responsibility for your retirement   planning is becoming greater and greater and 
greater and as as inflation keeps going up this is   a way if you think about it from a social security 
perspective this is a way that the government's   able to kind of save Social Security if they 
can inflate the currency of four percent and   devalue the currency but then only give you cost 
of living adjustments at two percent that means   they're recapturing that money and saving the 
program simply by the way they're doing that but   ultimately they're stealing that money from you 
through a hidden tax the problem is Dave doesn't   talk about all this and what he does is he talks 
about your need for this money he talks about   saving a million dollars and I got news for you 
you could save three million dollars and if you   get to uh retirement and you have three million 
dollars but you need to live on 281 000 a year   you are going to be up the creek without a paddle 
you're not going to be prepared and you're not   going to be in a position um you know ultimately 
where you're you know going to be able to uh   have a a solid situation you know that's that's 
really what it comes down to you're not going   to have any kind of predictable income you're not 
going to have any stability uh you know and you're   ultimately going to have a lot of risk especially 
when it comes to Market risk sequence of return   risk and and just Market volatility risk when 
it comes to your retirement if you if you follow   his plan you're going to be under saved when it 
comes to retirement simply because you didn't give   enough credibility to the impact that inflation 
is going to have on your future needs because   think about it this way everything I just showed 
you was a 10 assumption I could show you a lot of   ways that 10 is completely unrealistic especially 
when you talk about actual real returns I would   say six to eight percent is is the more realistic 
expectation and even then there's some risk   involved right so if we if we back that out what 
what that would look like at even eight percent   which is I think the more I guess traditional 
method that most financial advisors would say   you could get from a long-term perspective if 
you look at eight percent you're only going to   have just over four million dollars that's about 
at retirement 35 years from now for a 30 year old   right when you hit 65 so in that scenario you're 
still looking at only accumulating about half of   the money that you're going to need just to 
maintain your standard of living I don't care   how much you have in Social Security or pension 
it's probably not going to make up that Gap   and you're going to have to take a reduction in 
standard of living even if you follow his advice   and have no car payment and have no mortgage or 
anything like that it that that doesn't matter   that that's not gonna make up for the Gap that in 
inflation has caused for a problem for you and so   that's something that you need to consider so my 
encouragement to you is to go through your plan   figure out what inflation is going to do to your 
retirement planning needs and if you want help   with this I've got a team I've got a certified 
financial planner on the team that's happy to walk   through this give you a consultation walk through 
your needs walk through your current plan and and   give you an analysis and an evaluation on what you 
need to do moving forward to reach your goals on   a predictable basis one of the things I always 
ask I always ask people four questions first and   foremost doing what you're currently doing do you 
know what rate of return your money needs to earn   to be able to retire when you want and guarantee 
your standard of living for the rest of your life   if you don't know the answer to that question then 
everything else is going to blow up you can't plan   accordingly if you don't know the answer to 
that question second question is if you if you   don't know that number the question is do you know 
how much more money you have to save to be able   to retire at your desired standard of living and 
be able to retire when you want and if you don't   know the answer to that which most people don't 
I've literally met one person in my life that   actually knew those numbers ahead of time then 
you start backing it out and go okay how much   longer are you going to have to work if you get 
to retirement age and you haven't met that and you   still need to work well a lot of people they have 
to work an extra decade just to make it make ends   meet right people are thinking they're going to be 
able to retire at 65 but they have to work till 75   or 77 or 78 it's it's really just a sad situation 
but then the challenges our health a lot of times   sometimes sadly unfortunately fails on us we don't 
when you hit 65 there's no there's no promises   there's no guarantees heck there's no guarantees 
anyway but especially when you hit 65 our health   starts to fail like and for most Americans most 
people in this world Health starts to decline at   least and there's start to be different needs our 
bodies break down maybe your body isn't going to   be as capable of doing the job that you did for 
all those years to earn your income and so now   you have to start being like even if I wanted to 
keep working what is my real earning potential am   I really going to keep being able to do that or 
if I get sick what kind of reduction in standard   of living am I going to have to take just to be 
able to last the rest of my life and not run out   of money right and so these are the things that 
you need to consider if you haven't already like   I would encourage you to really do a deep dive 
because my favorite favorite quote in the world   I think and it's kind of tongue-in-cheek but just 
because the ostrich buries his head in the sand   doesn't mean the Lion's Den or plans have changed 
right this this is your problem this retirement   thing is a real problem it's a it's a thing that 
you need to figure out a solution to and you need   to create a plan for as good as Dave is at helping 
you get out of debt he's not great at helping   you plan for your future um and and his his 
information while it seems great because it's kind   of geared towards the masses it's actually in my 
opinion it's it's super detrimental to most people   that are listening to them because you're going to 
get to the end of the rainbow there's a going to   be no pot of gold you're going to find out you got 
to work longer if you're healthy enough to do so   or you're going to have to reduce your standard 
of living because you didn't take some of these   variables into consideration so anyway hopefully 
you found value in that if you did please like it   share it get it out there to people subscribe 
hit the Bell that way you're notified every   time I launch a new video until next time have a 
blessed inspirational day we'll talk soon see you

As found on YouTube

Retirement Planning Home

Read More

Dave Ramsey’s Retirement Planning Advice Is Flawed: Here is How

Dave Ramsey is wonderful if you are requiring some.
basic financial aid to leave financial obligation perhaps you'' ve been careless with your cash you''
ve. racked up harmful Consumer Financial debt and also you'' re looking to carry out some fundamental methods to remove.
that debt as well as to produce new behaviors for yourself when it pertains to your cash Dave has affected.
numerous people when it involves venturing out of debt when it comes to recognizing cash on a.
very standard level uh in a far better means the challenge is what has actually happened is Dave has aided millions.
of people leave financial debt and in that process he'' s built a whole lot of depend on up with that said individuals therefore.
then as a result they start listening to him for retirement advice for planning for the retirement.
future and in this video clip what I'' m going to do is I ' m going to cover the imperfection the significant flaw that.
remains in Dave Ramsey'' s retired life strategies I ' m not gon na argue whether he'' s appropriate or wrong.
concerning returns but I am mosting likely to mention the large flaw that most individuals are missing out on that.
he never ever talks regarding can'' t wait to enter into it if you sanctuary'' t already make certain you subscribe and.
hit the Bell this way you'' re informed every time I release a brand-new video clip Let'' s Go hi what ' s going. on cash money flow cyberpunks it'' s Chris with life 180. if you'' ve been viewing this channel a while you.
recognize exactly how I feel about Dave Ramsey however I desire to type of take the discussion concerning Dave to.
a bit of a different degree in this video um below'' s the bargain Dave is truly good when it. helps you when it concerns helping you get out of financial obligation yet his recommendations on retired life preparation.
is is definitely in my opinion shocking one of the greatest difficulties that I have regarding Dave and also.
his approaches is that he'' s been singing the same tune for 30 years right he has actually not changed his.
approaches his techniques he hasn'' t truly also transformed the numbers that he uses when it pertains to.
retirement planning and also the expectations that you ought to have around your whole your retirement.
preparing although the financial atmosphere has altered metamorphically right so if you.
understand that there are variables that affect your money and also influence what you can expect in.
retirement you need to recognize that there are no simple regulations that Dave tries to inform you like.
Dave tries to tell you to follow to perform currently I will certainly say that you understand the advice Dave provides.
is like it'' s much better than absolutely nothing like that I will certainly state it'' s better than not doing anything and it'' s better.
than what lots of people do yet I additionally think that it'' s it ' s an issue that if you follow his advice. expecting a particular result and after that you reach the end of the rainbow as well as there'' s no pot of gold and.
you'' re actually not anywhere near you where you believed you'' d be that ' s going to be an issue as soon as. once again we ' re not talking regarding the financial obligation elimination stuff we'' re speaking regarding which incidentally is a.
sensational thing to comprehend that as well as go out of financial debt thus from that point of view I applaud.
him currently moving on when we'' re chatting regarding wealth creation that'' s where he drops
when. it involves retirement planning what I did is I built a spread sheet since I assume numbers state.
a million words spread sheet you recognize we can go via this and what I'' m mosting likely to do is I ' m going.
to share this so below'' s what I intended to do here I wanted to take a look at a family revenue.
of about a hundred thousand dollars in today'' s money I intend to save 15 of that earnings annually.
I'' m mosting likely to presume an expected return of 10 per year all right so what this does resembles Dave is going.
to sit here as well as speak about the fact that you need to save money based on retired life you need to to.
Target pension values based on your hundred thousand bucks a year of income the.
difficulty is Dave doesn'' t take into this right into account'when he ' s ever before talking regarding'it I put on'' t. know why either I wear ' t recognize why if he if he believes people just aren ' t smart enough to number.
it out but to me this is simply basic Financial stuff that you need to know the understanding.
of you need to recognize to be able to make an educated decision if you don'' t recognize just how in.
inflation effects your monetary demands lengthy term you'' re never going to have the ability to make a great.
economic choice and also particularly that we'' re in this environment now where inflation is.
4.9 percent in 2015 it was over 9 percent long-term because 1971 inflation has actually mored than.
4 percent really nearing 4 and a fifty percent percent so like from that viewpoint looking at.
it from a long-lasting historical standard this 4.9 rising cost of living setting that we'' re in now that
. everyone ' s freaking out around is not even high it'' s just a little bit above average currently a great deal of.
people would certainly argue that rising cost of living is really way even worse than what we'' re speaking about today.
due to the fact that the real effect on the estimation of rising cost of living uh the the impact is is a lot higher as well as.
worse on specific houses uh than what the estimation claims because they'' ve in fact changed
. the computation over the previous 40 years on exactly how they identify the rising cost of living numbers which to me is.
Wrongdoer by itself yet here'' s the offer we have uh we have the hundred thousand dollars of revenue so. what I have more than here is I have um the retired life account balance required to live with a four percent.
guideline so if you wear'' t know what the 4 percent rule is it ' s the guideline that
claims you can. distribute 4 percent of your pension value as well as not run a significant risk of running.
out of money throughout your lifetime so that is like the safe distribution estimation expectation so.
what this is showing is that if you had a hundred thousand bucks of revenue you require 2.6 million.
bucks um in fact it'' s a hundred four thousand I didn'' t do it for year one if you get to year two.
as well as um you understand your real requirement on four percent inflation is mosting likely to be a hundred four thousand.
since your cost of dealing with rising cost of living going up it indicates you'' re going to require even more money. it needs your hundred 4 thousand bucks following year with four percent inflation is gon na. seem like a hundred thousand dollars of income Fields today the challenge is home income.
historically is only going up in concerning three percent so it'' s lagging actual rising cost of living and this.
is why the center class and also the bad are getting poor as well as there'' s this expanding divide between the.
well-off and also the middle course it'' s not so much other financial policies also though that has a.
have fun with it long-lasting rising cost of living is the best tax obligation that is hidden to the American populace and also.
it has a widely adverse influence uh on the middle course and lower class one of the most right so eventually.
this column is what I would certainly call your freedom number your flexibility number is just the amount.
of money that you require in an account to be able to retire to be able to be totally monetarily.
cost-free and so now make use of utilizing conventional four percent policy technique and currently I'' m not taking.
into account Social Protection or pension plan or anything of that nature so if in fact you did.
have a pension plan if actually you wish to lean on social safety and security for any factor you'' d need to look
. at your estimation and decrease those off of this number and afterwards you separate that by four percent.
which will give you uh this number so if you stated allow'' s say you had fifty 4 thousand dollars.
of pension plan and also social security you'' d subtract that out that'' d be fifty thousand divided by uh split. by the uh 4 percent which would get you what your uh Flexibility number would certainly be it would tell you.
just how much money you need in that account to be able to start passive income for you for the remainder.
of your life currently below'' s the challenge as I stated house revenue is just going up at 3 percent.
as well as Dave is saying hey you require to save 15 even if we earn 10 which is incidentally extremely unrealistic.
I'' m showing this at at 10 and it shows you at 6.561 million right here however actually that'' s because. of the truth that it ' s thinking that you'' re going to have a 281 thousand buck uh need for yearly.
revenue currently here'' s the deal your income is going up at 3 percent per year that 283 35 years.
from currently since I'' m thinking it ' s a 35 years of age

retiring at 65. Dave'doesn ' t talk about the reality. that if you make 100 Grand today you'' re mosting likely to require 281 to be able to preserve your standard.
of living that'' s not 281 000 in today ' s cash that'' s 281 000 in future cash right I simply did.
a video the other day speaking about uh rising cost of living and the inflation dilemma and also ultimately how that'' s. going to impact you um and and just how that'' s like the background of this inflation as well as and where it looks.
what it looks like relocating forward right into the future um but this 281 incidentally is presuming just.
a three percent boost at a 4 percent historical average of rising cost of living if we check out.
it that method you'' re going to in fact require 394 000 and also if you back that out you'' re going to need.
9 million 865 000 and the issue is every one of your Social Safety and security expense of living changes price.
of living boosts they wear'' t keep up with the real price of inflation so the demand for you.
to take even more responsibility for your retired life planning is becoming higher and greater and also.
higher and as as inflation maintains increasing this is a means if you consider it from a social safety.
point of view this is a way that the federal government'' s able to type of conserve Social Security if they.
can pump up the currency of four percent and decrease the value of the money but after that just offer you set you back.
of living modifications at two percent that implies they'' re recapturing that money and saving the.
program merely by the way they'' re doing that however eventually they'' re taking that cash from you.
with a covert tax obligation the trouble is Dave doesn'' t discuss all this and what he does is he talks.
regarding your need for this cash he discusses saving a million bucks and I got information for you.
you might save 3 million dollars and also if you get to uh retired life and also you have 3 million.
bucks however you need to reside on 281 000 a year you are going to be up the creek without a paddle.
you'' re not mosting likely to be prepared and also you ' re not going to be in a position um you understand eventually.
where you'' re you understand mosting likely to be able to uh have a a solid situation you recognize'that'' s that ' s. actually what it boils down to you ' re not mosting likely to have any kind of'sort of foreseeable earnings you ' re not. mosting likely to have any type of security uh you'recognize and also you ' re ultimately mosting likely to have a lot of threat specifically.
when it involves Market risk sequence of return risk and and simply Market volatility threat when.
it pertains to your retired life if you if you follow his strategy you'' re going to be under conserved when it.
pertains to retired life merely due to the fact that you didn'' t provide enough reliability to the impact that rising cost of living.
is going to have on your future requirements due to the fact that think of it this way every little thing I simply showed.
you was a 10 presumption I could reveal you a lot of methods that 10 is entirely impractical especially.
when you discuss actual genuine returns I would certainly claim six to 8 percent is is the a lot more reasonable.
assumption and also then there'' s some threat involved right so if we if we back that out what.
what that would certainly look like at even 8 percent which is I believe the more I presume traditional.
technique that a lot of financial experts would certainly claim you could obtain from a long-term perspective if.
you take a look at 8 percent you'' re just going to have just over four million dollars that'' s concerning. at retired life 35 years from currently for a 30 year old right when you struck 65 so because situation you''
re. still looking at just accumulating concerning fifty percent of the cash that you'' re going to need simply to. maintain your criterion of living I wear'' t treatment just how much you have in Social Safety and security or pension. it'' s possibly not mosting likely to make up that Gap and also you'' re mosting likely to need to take a decrease in. standard of living even if you follow his suggestions and also have no car payment and also have no home loan or.
anything like that it that that doesn'' t matter that that'' s not gon na make up for the Space that in.
inflation has caused for an issue for you therefore that'' s something that you require to consider so my.
motivation to you is to go with your plan identify what inflation is going to do to your.
retired life preparation demands and also if you desire help with this I'' ve obtained a team I ' ve obtained a certified. financial organizer on the group that'' s delighted to stroll with this give you a consultation stroll via.
your demands go through your current plan as well as and provide you an evaluation and an assessment on what you.
require to do moving onward to reach your objectives on a foreseeable basis among the things I always.
ask I always ask individuals 4 concerns initial and also leading doing what you'' re presently doing do you.
recognize what price of return your cash needs to gain to be able to retire when you desire and also assure.
your standard of living for the remainder of your life if you wear'' t know the solution to that inquiry after that.
whatever else is going to explode you can'' t plan as necessary if you put on'' t recognize the answer to. that concern second inquiry is if you if you put on'' t know that number the question is do you recognize.
just how much even more cash you have to conserve to be able to retire at your desired standard of life as well as.
have the ability to retire when you desire and also if you wear'' t know the solution to that which many people wear'' t. I ' ve actually satisfied one individual in my life that really understood those numbers in advance then.
you draw back it out as well as go fine just how much longer are you mosting likely to have to function if you obtain.
to old age and you sanctuary'' t satisfied that and you still require to function well a lot of individuals they have.
to work an added decade just to make it make ends fulfill right individuals are thinking they'' re going to be. able to retire at 65 but they need to function till 75 or 77 or 78 it'' s it ' s really simply a sad situation.
After that the difficulties our health a great deal of times often sadly unfortunately fails on us we put on'' t. when you'struck 65 there'' s no there'' s no assurances there'' s no warranties heck there ' s no warranties. anyway yet especially when you hit 65 our health and wellness begins to fall short like and for many Americans most.
people in this world Health starts to decrease at least and there'' s start to be various needs our.
bodies damage down perhaps your body isn'' t going to be as with the ability of doing the job that you provided for.
all those years to gain your earnings and also so now you have to begin being like even if I intended to.
maintain functioning what is my actual making potential am I really going to maintain having the ability to do that or.
if I get ill what type of decrease in requirement of living am I going to have to take just to be.
able to last the remainder of my life as well as not go out of money right therefore these are things that.
you require to think about if you place'' t currently like I would motivate you to actually do a deep dive.
because my preferred favored quote worldwide I assume as well as it'' s sort of tongue-in-cheek however just.
since the ostrich buries his head in the sand doesn'' t indicate the Lion ' s Den or plans have changed.
This this is your trouble this retirement thing is a real trouble it'' s a it ' s a thing that
. you require to determine a service to and you require to produce a prepare for like Dave goes to assisting.
you leave financial debt he'' s not excellent at assisting you prepare for your future and also as well as his his.
info while it seems terrific since it'' s kind of tailored in the direction of the masses it'' s really in my.
viewpoint it'' s it ' s extremely harmful to lots of people that are listening to them due to the fact that you'' re going to. obtain to the end of the rainbow there ' s a mosting likely to be no pot of gold you'' re mosting likely to figure out you obtained.
to function longer if you'' re healthy and balanced enough to do so or you'' re going to have to reduce your standard.
of living since you didn'' t take some of these variables into factor to consider so anyhow with any luck.
you found worth because if you did please like it share it get it available to people subscribe.
hit the Bell that way you'' re notified every time I introduce a new video until following time have a.
honored motivational day we'' ll talk soon see you.

Then the difficulties our health and wellness a great deal of times sometimes regretfully regrettably stops working on us we wear'' t.

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