Radical Personal Finance

It's Friday! Today, I have a Question and Answer show for you and I've decided to handle a bunch of your questions. I felt like I cheated you last week by only answering 3 questions.

1. (6:27) How do I calculate a portfolio distribution amount that retains 50% of my portfolio at my death?
2. (20:31) Is it ok to keep money in cash or do I need to invest right away to start getting compound interest?
3. (40:21) How do I rebalance my accounts to get a proper bond allocation?
4. (52:28) Should I pre-pay my mortgage in a lump sum or should I invest the money and then make extra monthly contributions?
5. (1:02:12) I have an unpaid medical bill and CC debt. What do I do?
6. (1:12:04) How do I apply the trivium method to a new job?
7. (1:30:01) Any tricks for how I can pay for a big dental bill in a better way?
8. (1:42:25) How do I figure out whether I should switch custodians for my investment accounts?

Enjoy!

Joshua

Links:

• IRS Publication 502

It's Friday! Today, I have a Question and Answer show for you and I've decided to handle a bunch of your questions. I felt like I cheated you last week by only answering 3 questions.

Enjoy!

Joshua

Links:

There's a lot of interest in our current-day world with the ideas of survivalism and prepping. One visit to your local bookstore's magazine rack will illustrate this to you.

Economic recessions and depressions, market instability, political gyrations...all of these things contribute to a general sense of unease for many people.

What could we learn about financial planning if we applied the mindset of a survivalist to our current reality?

I'm thrilled to bring you an interview today with James Wesley, Rawles. James literally wrote the book on how to survive the end of the world as we know it, among others.

Jim has authored 6 books on the topics of modern survivalism:

1. How to Survive the End of the World as We Know It: Tactics, Techniques, and Technologies for Uncertain Times
2. Tools for Survival: What You Need to Survive When You're on Your Own
3. Liberators: A Novel of the Coming Global Collapse (his brand-new book)
4. Patriots: A Novel of Survival in the Coming Collapse
5. Expatriates: A Novel of the Coming Global Collapse
6. Founders, a Novel of the Coming Collapse
7. Survivors: A Novel of the Coming Collapse

Jim's blog, SurvivalBlog.com has had almost 70,000,000 unique visits since July of 2005 and is one of the most comprehensive compendiums of survival information online.

The interview covers:

• Stockpiling as a financial strategy (the "Alpha Strategy")
• Alternative investments such as precious metals, ammunition, and productive farmland
• Functioning in a barter economy
• Buying nickels for a guaranteed investment return
• Applying ethics and morals in an immoral society

Enjoy!

Joshua

Links:

• SurvivalBlog.com
• "Getting Started" on SurvivalBlog
• "IRA Nationalization" on SurvivalBlog
• FAQ on Pre-1898 firearms
• RPF Episode 84: "Protect Your Wealth From Inflation by Implementing the Alpha Strategy (by John Pugsley): Concept, Implementation, and Problems"
• Jim's article on Investing in Nickels

Planning for a child's college expenses is a major financial goal for many parents. Unfortunately, this is an area filled with conflicting advice.

Some people feel that saving for college is a financial goal of utmost importance; others feel it's not worth the money. Many that desire to save for the goal get constantly conflicting advice on whether to do a pre-paid tuition plan, 529 college savings plan, EE education bonds, cash value life insurance policy, or any of a couple other dozen exotic ways to plan for this expense.

Today, we continue our college series by teaching how to do a calculation of the need. I teach you how to use a simple financial calculator and paper and pen and come up with a precise dollar amount to save for.

Enjoy!

Joshua

Links:

• The historical rate of inflation of college expenses
• Current cost of tuition at UF
• Previous shows in this series: Part 1, Part 2, Part 3, Part 4
• Free web version of the HP12C financial calculator for you to use

How to manually do the math for the college need on a financial calculator:

Step 1: Calculate the cost of the first year of college with a simple future value (FV) calculation.

PV = -$20,550 (cost of college today)n = 17 (years between today and first year of college)i = 6% (rate of inflation of college tuition)PMT = 0solve for FVFV = $55,336.48 (cost of college in the first year)

Step 2: Calculate how much money you need to have available when your child is in their first year of college.

PMT = $-55,336.48 (cost of college each year)n = 4 (four years of school attendance)i = 1.89% (inflation-adjusted return: [(1.08 / 1.06)-1] x 100 = 1.89%FV = 0solve for PV (make sure your calculator is in BEGIN mode)PV = $215,262.97 (amount needed in first year for four years' tuition)

Step 3: Calculate how much the parents need to save in either a lump sum (PV) or yearly amount (PMT) or monthly amount (PMT-convert i and n to monthly amounts).

LUMP SUM VERSIONFV = $215,262.97 (amount needed in first year for four years' tuition)n = 17 (years between today and first year of college)i = 8% (rate of return of investment portfolio)PMT = 0solve for PV (if you want a lump sum)PV = $-58,178.90 (lump sum amount needed today to fund the cost)

YEARLY SAVINGS VERSIONFV = $215,262,97 (amount needed in first year for four years' tuition)n = 17 (years between today and first year of college)i = 8% (rate of return of investment portfolio)PV = 0 (current amount of savings)solve for PMT (if you want yearly payment amounts...look for info in a case scenario on whether to use BEGIN mode or END mode)PMT = $-5,905.67 (yearly amount needed to fund the cost)

Today, we celebrate our 100th episode! I'm thrilled to hit this milestone!

In today's show I share with you a bit about the genesis of the show, the path we've been on so far, and why I have done it the way I have.

Additionally, I share with you my vision for the future of the show. Specifically, today I'm launching The Irregulars, my new membership support program.

Please listen to the show and understand why I've chosen a listener-support approach to earning money from the show instead of accepting advertisers, affiliate programs, etc. It will make a huge difference in the show.

Enjoy!

Joshua

Links:

• So far, the most listened to show is the interview with Curtis Stone.
• Second most listened to show is the interview with Jacob Lund Fisker.
• Third most listened to show is the Millionaire Educator interview!

Today, we continue our education series with a discussion of my ideas and vision for primary and secondary school education.

One large problem in the world of financial planning is that often parents wait too long to consider college planning. I propose that we instead consider college planning at birth and build flexible, comprehensive plans.

This show is purely about some of my ideas for my son's education. I hope you'll consider them and create your own list.

Enjoy!

Joshua

Links:

• First episode of this series: "How to Pay for College Part 1: Teach Your Baby to Read RPF0077"
• Second episode of this series "The Untold History of School That You Probably Don't Know: Interview with Brett Veinotte, Founder of the School Sucks Project" Part 1 and Part 2
• The National Center for Education Statistics: Annual Cost per Student: $12,608
• Audio Recording of "The Lost Tools of Learning" by Dorothy Sayers
• Bio of Arthur Robinson and his curriculum