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If the content of Radical Personal Finance is worthy of your financial support, please go to radicalpersonalfinance.com/patron. Should take about three minutes. You put a number in the box, click support, there's some bribes there for you. That's it. radicalpersonalfinance.com/patron. Today on the show, we dig into three more questions and maybe more depending on time.

Three questions I didn't get to yesterday. Number one, discussion of special needs financing for kids. Just a quick discussion today. Also, starting a podcast but dealing with potential controversy and how do I manage money, college money for a 15-year-old boy. Josh, on a recent show, you talked about your frustrations with the ethics behind some of the investment markets and investment products.

What are you going to do about it? I'll share with you some details in today's show. Welcome to the Radical Personal Finance podcast. My name is Joshua Sheets. I'm your host. And today, I'm your answer man. You should steal that. Cliff Ravenscraft has his podcast Answer Man podcast and Roger, what's his last name?

Roger, who has the retirement Answer Man. I should be the money Answer Man. So today, Joshua Sheets, the money Answer Man, here to answer your questions. Of course, I'll leave it up to you to decide whether my answers are worth anything or not. That's up to you. But today's questions come from some patrons of the show who I put out a call for questions and I've got lots of questions.

And so I've decided just to burn through a bunch of them and I love answering your questions. They give me fun things to talk about. I'm going to kick it off with just a very short question for Jose who asked a question about special needs planning for a special needs child.

He says, "Joshua, do you have any tips or feedback about how to factor a special needs child in when planning for retirement, college, etc.? The typical advice usually is that once you have a special needs child, things change as you delve into the wonderful world of early intervention, therapies, IEPs, which I believe are individualized education programs if my knowledge of IEPs is correct, tax planning, etc.

I used to think that I would just need to change my assumptions in terms of planning for our son to be with us long past his 18th birthday as well as making sure we plan for after we're gone. But I'm sure I'm missing other strategies. Thanks, Jose." Jose, in essence, you're right.

That's really all it is just with another level of technical complexity. In some ways, it's a simple question and in some ways, it's not. The field of the tools of technical financial planning for special needs is quite complex and it's quite specialized. I don't have a deep specialized knowledge in this area.

I have just a general cursory overview. I do have on my list some attorneys who are real specialists in this that I may reach out to and do an interview with, even some that are near me. I know you mentioned in a different part of your note that you're in South Florida.

There are some people in South Florida who are world class. There's one attorney on my list who's literally almost written the book on special needs planning in Florida. So there are some general – well, there are some specific things that I'd like to cover. I would like to be very knowledgeable and expert in this area and I might use this show as a reason for doing that.

So in the future, I might go ahead and cover that in depth. The reason that I'm mentioning it here is I would love to see a financial planner who is an expert in this do their own series of podcast episodes that are educational in this area. That's why I wanted to bring it up here.

If you are that financial planner with the knowledge and you can start a show on this topic and make it very user-friendly, make it good information, let me know and I will help you publicize this because I do get emails about this from time to time and I'd love for somebody else to do this.

As far as being a podcast producer, it's kind of a balance because it's very technical and it applies to a very important but very small portion of the population. So my personal need is to – my personal strategy is right now I'm appealing to fairly broad-scale mainstream needs and special needs is much more niche.

But if you know of a great podcast or a great series of publicly available, useful, not so just salesy materials on this, let me know. Comment on today's show and put it in the show notes and I'll be glad to publicize that. If you are a financial planner with a real expertise in this area or an attorney who practices in this area, I'd be glad to interview you on the show.

So reach out to me, email me, Joshua at Radical Personal Finance. So, Jose, the technical side is quite specialized but it's really not that complex from the perspective of what it actually means as far as a financial planning constraint. And I think this is a useful concept. I'll leave it up to you to judge whether it's useful or not, but I think it's a useful concept.

All you need to do is add some additional constraints to your financial plan and those constraints are this. What are the expenses that my child needs during my lifetime? And what are the expenses that my child needs during their lifetime after I'm dead and gone? If you keep that in mind as your operating principle, I think it'll be less overwhelming to you.

Let's assume that – I think you said a son. So let's assume that your son has extra need for help such that it's going to cost you $2,000 a month of ongoing extra support and maintenance to provide for his care regardless of the living situation that you and your family find is best for him and for his needs.

Well, under this scenario, you just simply need to take all of your financial plans and add on a $2,000 additional cost throughout your lifetime. And then you would look at all of your assets and say, "When I die, how much do I need in terms of assets to make sure that my son is cared for throughout his life?" And if you keep that in mind, I think you'll be able to make better decisions with regard to the technical complexity.

There are a variety of technical financial planning tools. There might be a certain special needs trust design that will be useful to you. You might or might not need to reassess your life insurance strategy. You might need to look at your investment strategy. If you're investing with a 60-year time horizon instead of a 16-year time horizon because you have to cover your lifetime plus his instead of just your lifetime like many parents can plan for at the end of their life, it's going to adjust those things.

So try to keep that as an operating principle and just realize this is an additional constraint. You might need to work a few extra years to earn the money. You might need to put some additional measures in place. But there's not that much different to it other than the need for cash flow.

The primary thing people forget about with investment planning is that we're always just dealing with cash flow. Almost every aspect of financial planning is cash flow. So if we're talking about retirement planning, we're saying how do we create cash flow from a job and then have cash flow from investments such that I can stop the cash flow from a job?

It's all cash flow planning. And there are a variety of ways to do that. It could be the cash flow from rental income, from a real estate portfolio. It could be the cash flow from dividends, from a dividend stock portfolio. It could be the cash flow of life insurance cash value loans.

It could be the cash flow from selling off gross stocks that aren't paying dividends but you're just selling off partial shares of a mutual fund maybe. It could be cash flow from the fact that I've written a book and I'm spending the royalty income from that book. It could be cash flow from the fact that I continue to own a minor stake in the family business and that family business is paying me out cash flow.

It's all cash flow planning. All insurance comes down to cash flow planning. Let's talk with simple insurance. This is actually not an insurance policy. What is an emergency fund? An emergency fund is partially – well, it's – no. An emergency fund is cash flow planning for unplanned expenses. So in advance, we know that it's possible that the transmission could break on the car and the car is undriveable.

So therefore, we're going to require a cash outflow of say $2,000 to drive the car. We need to set that money aside in an emergency fund or we might suffer a job loss. So therefore, we're going to be out of work for maybe four months. So by having four months of savings to cover cash flow, then we'll be able – when we don't have the cash inflow from a job to meet the cash outflow of our expenses, we'll be able to cover that necessary cash outflow from our savings, from our emergency fund.

What do insurance policies do? What does a car insurance policy do? We're going to wreck the car and so we're going to have a large cash outflow of paying for the other person's car to get fixed and paying for my car to get fixed. So we have an insurance policy that establishes the cash inflow that we need to protect us from that cash outflow so we don't have to pull it from other areas of our budget.

What does disability income insurance cover? I'm going to get disabled, so I'm not going to be able to work. In that scenario, I would suffer – I wouldn't have any cash inflow. Once I'm able to cover that – so I need another source of funds to be able to cover the necessary monthly cash outflow of my budget.

Now, once I have enough other assets set up that the cash inflow from those other assets is enough to cover my cash outflow, I don't need the insurance policy anymore. So I know this sounds incredibly simple and incredibly basic, but we don't often cover this very much. If you always just keep that in mind that the only thing we're dealing with practically with insurance – or excuse me, with any aspect of financial planning is cash flows because that's the money that you spend.

The only purpose of assets and owning assets is for cash flow. You own a house. Let's say that you reach the goal of paying off your house. What does that benefit you? Now you have an asset that doesn't require quite so much cash outflow from your budget because you're no longer paying off the mortgage principal and interest payments.

So if you grasp that concept, I think it will be very helpful to you to consider every aspect of financial planning. The next question – in two questions, I'm going to answer some questions about my investment strategies. This answer is that question. All I need to do is structure my investment strategy so that they provide me with cash inflow to meet my cash outflow needs, with cash flow needs.

That's it. That's all I need to do. And I can invest that money in all kinds of different ways that I can do that. One of my favorite discussions of this – if I remember, I'll go and look it up. But if not, just go to Joshua Kennan's site.

His site is joshuakennan.com. And he had a great essay on that called "The American Measure of Net Worth Versus the English Measure of Net Worth." And I've mentioned this before, but I want to mention it again because it's so important. The American measure of net worth is I'm a millionaire, which means I have a million dollars of assets.

You can't spend assets. You only spend cash flow. The traditional English definition of net worth was I have an income of 20,000 pounds a year. That's money that you can spend. So what you're always focusing on is what the actual money that you can spend is. When you're bringing in special needs, don't get intimidated by it.

All you're looking for is how much money needs to go out and for how long and how am I going to replace that cash flow. Even when you get into discussions of a special needs trust, the major purpose of a special needs trust is to allow you to have some of the required cash outflow expenses covered by the cash inflow from the government programs and not have the cash inflow from the government programs reduced because of the fact that your special needs child has too much money.

That's the major purpose of the special needs trust. So don't be intimidated by the details. Be confident in your ability to ask the right questions and just remember I'm adding on additional expenses to my needs, and I need to figure out how to cover those expenses in an ongoing period of time.

And you'll be able to sort through all of the challenging technical decisions if you're confident in that. Oftentimes we get intimidated by financial planning topics because we as financial planners or attorneys or whomever, we're likely to jump right into the technical consideration. But you need just a simple mindset and then you'll be able to handle the technical decisions.

So I know that's not a brilliant technical answer for you, but I still felt it was important to give that answer. Next question is an email comes in from Ray. Ray says, "I've been working at a major package carrier for almost 26 years. I was just inducted into their circle of honor, which means that I've been accident free for over 25 years.

Mind you, I drive in New York City. I'm highly trained and I'm pretty good at what I do. Since listening to you and some other podcasts, I was thinking of starting my own podcast. Driving is something almost everyone does and there really aren't any podcasts on safe driving. Trust me, most people don't know what they're doing.

The problem I have is exactly what you went through after episode 181. I don't want to argue with people over everything that I say. I don't understand why people can't take the good and credible information out of a conversation and leave the bad behind. I don't agree with everything you said, but that doesn't mean I didn't pause and think about what you were saying.

Kudos to you. I'll be retiring in four years. Maybe by then I won't care what anybody thinks. Also, while I have your attention, I have a question. I have a 15-year-old son who works for his mother's company from home. He takes home $225 every two weeks and she saves about 75% of that.

I opened up a brokerage account for him to separate the money from savings and checking. I spread the money out into four different ETFs. I'm trying to teach him to invest and diversify. The problem I have is he might be using some of this money or all of it for college.

I'm afraid the stock portion could be a problem since I know you shouldn't have money in the market if you're going to need it within three to five years. I'd like to know your thoughts on this situation. Thanks. Ray. Ray, it's a fun question. I'm going to answer the financial planning question first and then come back to the podcast question.

But with the financial planning question, just you have to constantly think about what's the goal of this money and what's the backup plan in case of a change in the investment fluctuation. If the goal is college and the money is necessary for college, then yes, I would be very careful with the portfolio.

You're right in that very difficult window right now as far as how to manage an investment portfolio for a cashflow outflow need. It's difficult to know the answer because of the time horizon. If he's 15 years old and we use simple numbers to say he's going to go to college at 18 under a traditional graduate high school, go right to a four-year university plan, then you've got a three-year time horizon for that up to a maximum of a six-year time horizon to when the final tuition payment is due at the beginning of his senior year.

So three to six years is a very problematic, challenging number. Three years is probably – you'd have to look at the data and I didn't check all the numbers for my name. I did a lot of – excuse me, in preparation for this answer to make sure I have all the data at my fingertips.

But three years is one of those scenarios where a lot could change in three years. We could head into a nasty bear market. We could head into a nasty recession and three years could bring us out of it. Six years could almost surely bring us out of a nasty bear market or nasty recession.

Think back in recent history. The best one that most of us remember would be 2008. What was the difference between 2008 and 2011? What was the difference between 2008, 2013, and 2014? Big difference. Now the challenge would be the emotional ability to handle it. Do you have the emotional ability to handle that change?

Let's say that your son is sitting down and trying to figure out where he's going to go to college and he's trying to choose among different options. Well, if there's a lot of money sitting in an account versus a little money sitting in an account, that might influence his decision.

So you're right. It's in a very difficult – you're in a very difficult place with this phase of his investing. And it's difficult to know the answer. It's tough. I don't have a good answer for you. I'm not really that comfortable commenting too deeply on my own personal prognostication of the markets.

I do think that it just feels to me like recession in the near or short term is at least possible if not likely. But I'm not qualified to provide any support or numbers behind that. That's just a pure feeling from one friend to another, not an academic prediction. And your problem here is time horizon.

And so a couple ways to solve that would be – here are my thoughts. Do you have other money available to you that you could use if you needed it? So if you, for example, are sitting on a big pile of money and this money is just in cash and this money is just sitting in an ETF – it's not within the constraints of a 529 plan, something like that – then if you have another source of cash where you needed to use some of that and wait for investments to come back, that might give you a little bit of a longer time frame.

So that might be useful for you. It's one of the reasons why having cash and having liquid nonvolatile savings available can make a big difference. It's not about – in the academic literature of investing, it's all about optimizing the total rate of return. And the total rate of return is going to be about how do we invest and keep invested for the total rate of return.

And when the academics are writing their papers, they can't take – you can't take money out and put it on the sidelines. In real life, however, we can't spend total returns. We can only spend the money that we have in our accounts. And so in real life, you've got to take the academic literature and look at it and say, "Am I going to be bothered by my account declining in value by 20% or am I going to be joyed by the value of my account increasing in 20%?" And so this is why from a practical perspective, when you're purely in the accumulation phase of planning for an investment goal, you kind of got to keep your stomach strong and just deal with the ups and downs.

But when you're about at the distribution phase, you've got to start to be strategic and you've got to prognosticate a little bit. And I'll tell you I'd be hedging my bets personally if I were working with a 15-year-old boy at this phase of his planning and I wouldn't want to have all the money invested in purely stocks.

Unless I had enough – unless I as a father were wealthy enough and I had enough other money that was liquid where I knew that if this specific account were to significantly decline in value, I could take money from another account to fund the cash flow need and then pull it out.

Now, remember though, if you did get burned, let's say that all of a sudden we went into a scenario and, again, this money is just in ETFs. It's not inside of a 529. It's just a brokerage account and it's money that he's earning and you did get burned by the investment market and he's 17 years old and he's saying, "Man, my investments are down 30 or 40 percent." Well, all is not lost.

So still be strategic at that point in time. So for example, maybe at that point in time you would simply choose not to sell those investments. You would look at them and say, "I'm happy with these investments. We're in a temporary decline. There's a short-term scenario if you believe this about your investment portfolio," and he could go ahead and at that point in time maybe he could take out a student loan and the interest on that student loan would be deferred while he's in school and then he can go ahead and pay it back when the market comes back.

He might also just be in the scenario where he has the money in the ETF but he realizes he'd rather have it for the long term and he's going to own it and not necessarily take it out and use it on school because he's able to get scholarships or other things, etc.

So that's a difficult scenario from the technical financial planning perspective and it very much depends on how much money you have available, what portion of the portfolio, what are the backup plans. To me, think about the backup plans and if you're comfortable with volatility. Hopefully that's a good start.

Remember this, however. At 15 years old, I love, love, love that you're teaching him about investing using the ETFs. Don't forget about teaching him about investing in personal finance with his personal expenditures. I don't know what your involvement is here. I'm mentioning this for you and also for the audience.

But one of the most important lessons here is that he is learning how to manage his own money for the purpose of his own personal expenditures. Investment knowledge is important but also spending knowledge is incredibly important. So be working on transitioning him over so that he's not just pushed out of the nest at 18 and he's got to figure out all his college expenses.

A lot of college students get really into a jam because it's the first time they've managed money. It's the first time they've had a credit card. It's the first time they've been able to go and buy all the food and drinks they want. It's the first time they've been able to – they needed to buy for their – pay for their own clothes.

So get him started with a system of budgeting if you haven't already. Make sure that he's responsible for all of his own expenditures. Make sure that he is the one – even if it's something you're going to pay for, get him started paying your rent. Get him started paying – or his mom rent.

Get him started with – again, with paying for his clothes. Here's the budget. Get him started with budgeting, with keeping a checkbook, with looking at things. And get him started on goal setting, thinking about what his long-term goals are, thinking about it. If he's conscious of that stuff, he will probably make an excellent decision with regard to college.

And that will be a big, big deal to him is knowing how to make a good decision with regard to college. Can he go to a college that's really going to open up a career option for him, especially if they're going to pay him? Or is he going to go to the dead-end college that's expensive?

Or is he going to go to the dead-end college that's cheap? And making a consumer decision. Not enough college students make careful, financially motivated decisions with regard to college. I didn't. I made mistakes here and I wish I'd done things differently. So I'm trying just to share that. The other aspect of it is I'd encourage you to try to find – in addition to the ETFs, try to find a way to make investing really connected to him.

Finding some brands and venturing into individual stocks or finding an ability with trading. And I know you're probably already doing it. It's just fun. I love the idea of talking with 15-year-olds. Try to make it in addition to ETFs. Have him look at the idea of swapping out cars or whatever.

If you're in New York City, I don't know how difficult that is. It's a little different than in the suburbs. Finally, make sure that he is focused on his investments in scholarships and scholarship applications. At 15 years old, you have a real opportunity. If you can hold a vision before him, he has a real opportunity to make a massive amount of money going to school if he can be strategic with his scholarship work.

There are thousands and thousands and thousands of potential scholarships that are available out there. And very few 15-year-old students have had somebody come alongside them and talk to them about approaching this as a financial planning strategy. Most of the time, we just simply look and say, "Well, I'm an athlete, and this school is offering me an athletic scholarship." That's awesome if it's true or "I'm an academic, and this school is offering me an academic scholarship." But even if he has those things or doesn't have those things, just simply applying for individual scholarships is worth an amazing amount of money.

That should open up a lot of opportunities for him. And let me give you this as a strategy for a parent. Very few parents are aware of this. Many scholarships go unclaimed, and many scholarships have very few applicants. And so depending on his skill and depending on his diligence with finding the right scholarships, it can be relatively easy to get scholarships.

And there are scholarships if he's a bad student and he's just in need, or there's a scholarship if he's a great student, or if he has some ethnic background, or if he has some religious background, or some connection and relation to the local furniture store. And little scholarships can add up to be a big deal.

I missed this one. I missed this one, and I've never found a high school student that's taken me up on this. But I think this is a good strategy, which is why I'm going into it in as much detail as I am. If you just simply make it his job, his part-time job, he's got to do it.

You can't -- I mean, you can hold the vision, but he's got to decide this. But if he can make it his part-time job to apply for scholarships, even if he's got to write an essay and he's got to fill out the application process, et cetera, and let's say that he's going to work on this, and I don't know how many hours exactly, but let's just say it takes him a total of four hours to complete a packet, write an essay.

You insert your numbers directly, but write a short essay, complete a packet, and apply for a scholarship. Let's use five hours. It will be easier math. So it takes him five hours to do that. And let's say that he is able to do that and he applies for a total of 100 scholarships.

That would be a total of 500 hours. If he were working 50 hours a week during the summer, that would take him a total of 10 weeks of work. So we've got 500 hours, 50 hours a week, 10 hours -- excuse me, 10 weeks of total work full-time. That's easily done in a summer.

If he applies for those 100 scholarships, and let's say that he's awarded 5% of those scholarships for a total of five scholarships, assume that they're very small $1,000 renewable scholarships. There are many that are bigger. There are some that are smaller, but just for the sake of my illustration, it's a $1,000 renewable scholarship that's renewable each semester or you can use each year depending on how you want to do this.

When I was 15 years old, I did not understand the power of a $1,000 renewable scholarship. I got one specifically that is memorable to me that was a local Kiwanis Club scholarship, and I applied to it, and I got it. I had to go just write a simple application, and I did it.

And I kind of poo-pooed. I was like, "Ah, it's $1,000. What does $1,000 matter in comparison to my $20,000 school bill?" Now, I don't look at it anymore. What I found out was that $1,000 was allowed me to get my books and allowed me to put a little gas in my car, which barely got me through some of school.

But what I didn't comprehend was that that scholarship was easily renewable every semester, and some of these are renewable every semester, and some of them are renewable every year. I think mine was renewable every semester, which means that over a course of a total of eight semesters, I didn't have to do anything except go to an awards banquet where they handed me a check.

And so that meant my $1,000 scholarship was actually worth $8,000. $1,000 scholarship was worth $8,000, $1,000 each semester for eight semesters. I have never made more money on an hourly basis in my life than applying for that scholarship. And it was based upon my academic record, and all it was was an application and an interview and going to an awards banquet every semester.

That scholarship made a huge difference in my life. But here's the math. Let's say that he applies for 100 scholarships, and he only gets awarded 5% of those. So he gets a total of five scholarships. Five scholarships times $1,000 each is a total of $5,000 of income. Now, depending on where he goes to school, that may or may not get him to school.

But $5,000 is nothing to sneeze at. But remember that $5,000 is renewable each semester for eight semesters. So multiply $5,000 times eight, and now he's at $40,000. How much time did he invest into that? 500 hours. Divide $40,000 by 500, and his hourly wage is $80 per hour. I hope you find that as compelling as I do.

I wish somebody had come along to me at 15 years old and showed me that. I don't know if I would have had the character, the discipline to force myself to do it. But I believe it's something worth doing. Whether or not he applies for 100 scholarships, I don't know, whether at least he applies for four.

I'll tell you this. I think I applied for three and I got two. So I don't know what the actual ratios are. I don't know. But the point is he should be thinking about this and working on scholarships as one of his best investments that he can make. And for a young person ready to go to college, if he'll take every night and do one application every night during his summer and during his school year and do that every night for a couple of years, there's no reason why if he keeps good records and he's obviously not going to do it every night.

He might get three or four a week or three a week or two a week or one a week. You get my point. If you do one a week, every week for 52 weeks, that's 52 applications. Over junior and senior year, that's 100-plus applications. He might get 20 percent of them or he might get 2 percent of them.

You'll have to track this, and if he does this, let me know. I've never found anyone who's actually done this. I've read some books from people who have done a good job with scholarships but who haven't looked at these numbers the way that I do. But $500 scholarships, $250 scholarships, renewable each year, these things add up, and there's not a lot of competition for those little scholarships.

If you add that on to some help from a school, he can get paid to go to college for four years and he can have all the money left in his ETFs and he can have all the time because all of his courses are covered, all of his living expenses are covered, and he can have the time to go ahead and use the time in college to study and focus on learning but also to explore starting a business or explore a career.

My sister got paid to go to school, and she didn't even need this many – she didn't even follow this kind of strategy. My brother almost got paid to go to school. I would have gotten paid to go to school if I had gone to a state school. So think about this and think about inspiring him and trying to lead him into something like that.

And if any of you ever are able to get your 15-year-olds or your 16-year-olds or your 17-year-olds to follow through and do this, I would love to hear from you. Again, be warned, I don't think I would have had the capacity or the character unless somebody had used those numbers to inspire me.

I don't think I would have had the capacity or the character to follow through and write the little short essays and fill out the applications. But I think if somebody had showed me those numbers and had showed me the fact that I could make thousands of dollars per year on little scholarships applied all over the place, I think that would have at least motivated me to do more than I did.

And once you get into college, those little scholarships make a big deal. I'm forever indebted. I spoke to that Kiwanis Club that gave me that scholarship recently a few months ago, and I just was able to express my feedback to them personally and say, "Thank you." That made a huge difference for me.

Now, let's talk about your podcast idea and the topic of doing a podcast but facing the controversy. I appreciate your encouragement by writing me the encouraging note. It helped me. And so I'll encourage you right back. And I would say simply this, if you have the idea and if you have a desire, do it.

You're the one who will benefit the most from it. You're the one who will learn the most from doing it, and you're the one who will benefit the most from it. And that benefit will come in all kinds of ways. It probably won't come – I can't – I mean maybe I'm wrong, but I can't imagine a driving podcast being the number one best podcast on iTunes, especially if it's uncontroversial.

Most of the time, the types of themes of media that seem to do the best in our culture are going to be entertainment-focused, controversial, intentionally sensational, tantalizing, just different aspects like that. So I wouldn't expect it to be necessarily number one, but I still think that you should do it because you will learn from it.

The teacher always learns more than the student, and you know that. You're much older than I am. But I'm convinced the teacher always learns more than the student. Not everything is controversial, and I don't think it should be. So there's no reason to ever expect if you did a show that was specifically focused on a topic that was important to you – I don't think there's any reason why necessarily it needs to be controversial.

If I were simply teaching CFP classes to financial planners, I wouldn't talk about worldviews. I wouldn't talk about morality and ethics. I would just teach the mumbo-jumbo that's in the curriculum on the ethics, and everyone just assumes it and no one questions the worldview behind it. There's no reason for that.

But I'm not doing that here. And one of the reasons why I do this show is for me to learn. I am convinced of this. Controversy is not necessarily bad as long as you learn from it. And I don't necessarily mind the controversy over my subject matter. I was emotionally affected by it, but I wasn't emotionally affected because people were angry with my subject matter, but primarily because I didn't feel like I had effectively – that I had done a good job.

Most of the – I was affected by the lack of people saying that it was at least thought-provoking. Most of the feedback that I got, especially in the beginning over episode 181, was just – it was just silly and kind of ranting and emotional. And you can quickly look through and recognize just people that are emotional.

Just – "Joshua, I'm accusing you of homophobia and I'm all upset with you." Accusing me of homophobia because I talk about ideas underpinning a worldview is silly. It's like accusing – right now, we've got – the Supreme Court case was argued the last couple days. It's like accusing the Supreme Court justices of bigotry just because they don't automatically just issue their ruling in the – what's the – Obergefell versus Hodges case.

It's the one before the Supreme Court. That's just part of the playbook of modern society of how we generally deal with public opinion and anybody who dissents against public opinion. That's part of the playbook from After the Ball is we pile on to people and we call them names.

And I say expect that if you're going to stand for anything. I don't actually mind very much that happened because I expected it. That's how we deal with stuff in our modern society. And oftentimes when we don't have an ability to deal with the deeper issues, our response is to become emotional and angry.

And that's what our response is because we don't know what to do with it. What did disappoint me and did discourage me was that I didn't get any kind of counterfeedback in the beginning. I have gotten some now but I didn't get any feedback about the actual argument I was making.

And that was tough. It wasn't the emotional stuff. It was the fact that I didn't get any feedback about the actual point. And then I felt like I did a bad job and I took that personally because it's my responsibility as a teacher to do a good job. I had years of bad teachers in high school and college.

And it wasn't until my junior year that I finally had some teachers in college who really challenged me. And they challenged me deeply. They disrupted my entire framework. And I was angry about it because I didn't know how to deal with it. I didn't know how. I had all these ideas but I didn't have an ability to deal with it.

And that was actually what sent me back to consider my own framework deeply and to actually think through, "Wait a second. What is the underpinning behind what I'm doing?" And so I was discouraged because I felt like I didn't get anybody to say, "Wow, I totally disagreed with you but I was challenged by what you said." And I was annoyed with myself for presenting difficult information and I guess I felt like I hadn't done a good job with the actual issues.

And I was disappointed in my teaching ability. I published the show too quickly and I had put a lot of work into it but looking back on it, I realized I should have divided it up into sections. I should have presented it differently. I should have – anyway, so that was discouraging because I felt like I had failed and I had turned people off without them thinking about it.

And I get disappointed when people just react emotionally and don't think. Now, of course, I could be wrong in anything that I think. But pay attention on this issue and I'm not going back into the subject. I just want to emphasize I felt after the fact though I still am glad that I used that subject because I've researched issues for years and never really grasped how society changes or is changed by those in power until I studied this issue.

And then a lot of things became clearer for me on the other difficult, more long-reaching answers. And I just noticed this. Notice what – in the oral arguments before the Supreme Court this week, notice what – read the transcripts and notice this quote from Justice Kennedy. Again, Justice Kennedy, remember, is the widely acknowledged swing vote on the forthcoming decision in a couple of months whenever they – or next month or whenever they rule on this case.

And listen to this quote from the transcript of the oral arguments before the Supreme Court. Justice Kennedy, one of the problems is when you think about these cases, you think about words or cases, and the word that keeps coming back to me in this case is "millennia" plus time.

First of all, this is – there has not been really time, so the respondents say, for the – so the respondents say, for the federal system to engage in this debate, the separate states. But on a larger scale, it's been – it was about the same time between Brown and Loving as between Lawrence and this case.

It's awkward to read these transcripts. I'm sorry. It's about ten years. And so there's time for the scholars and the commentators and the bar and the public to engage in it. But still, ten years is – I don't even know how to count the decimals when we talk about millennia.

This definition has been with us for millennia, definition of marriage, and it's been very difficult for the court to say, oh, well, we know better. So that's the direct transcript from it. But the point is that Justice Kennedy is recognizing in that argument that the fact that there has been for millennia an overall understanding of what the definition of marriage is and in this tiny amount of time that has changed.

Justice Alito echoed the fact that marriage – he talked about that marriage has always been a heterosexual institution until the end of the 20th century. "Till the end of the 20th century, there was never a nation or culture that recognized marriage between two members of the same sex." And then two years ago – I know one article I was reading about this two years ago, Justice Alito pointed out this argument, which is amazing when you consider it.

He pointed out the fact – excuse me. Justice Alito pointed out the fact that same-sex marriage is more recent than the smartphone. And so what's amazing, as I stand by my point, is that to understand the way the modern world works, you can have – there's no better case to study than this issue because you're dealing with millennia of history and then in a period of 30 to 50 years, a massive – depending on when you decide to start from, a massive transformation.

It's an incredible system to study. But – so that's just a side note on that topic that I wanted to point out as follow-up from it that – from the Supreme Court oral arguments. But the real benefit of producing media, the real benefit of writing is that your arguments are tested.

And what you say has a chance – you have a chance to be held accountable for what you say. And you're going to win either way. Either you're wrong and somebody will show you how and why you're wrong, in which case you win because you've pulled out faulty thinking from your operating system.

And you've had the opportunity while you can still do something good with it, you've had the opportunity to identify a problem with your thinking and you've grown from it. Or you're right and your argument stands and you've had the opportunity to help another person. So you win either way.

And this is different in the field of public debate than it is in interpersonal debate. I've long maintained – ever since I read Dale Carnegie's – what is it? Win friends and influence people. And that opened my eyes to it because I've long maintained that personal argument between people is almost – you cannot win.

Because in personal argument between two people, if you win the argument, you lose the friend. And if you lose the argument, you lose the argument. That's in personal people. So there's very different in personal scenario than in public because in public though when people debate you, some people will rip you apart against your personal stuff and call you names, whatever.

But some people will actually deal with your arguments and then you have the chance to win. You either have the chance to have your argument pulled apart and shown to be faulty in which case you can go back to the drawing board and fix your argument or figure out where your flaw is.

And that's how progress happens. That's the whole scientific method. That's the whole point of it. It's just we're taught about it and we're not taught to do it. But – or you find out that your argument wins in which case you're able to help somebody else to think. You're going to gain more from publicly airing your ideas than anybody else's.

I learn far more from doing this show every day because of the pressure of public opinion. And I learn more from my preparation and I learn more from actually doing it. From the preparation, by that I mean this. There's a proverb in Proverbs 25 that says this. It says, "Do not go out hastily to argue your case.

Otherwise, what will you do in the end when your neighbor humiliates you?" Do not go out hastily to argue your case. Otherwise, what will you do in the end when your neighbor humiliates you? So I don't want to embarrass myself and I probably will because I'm not an expert at everything.

In fact, I'm an expert at very few things except some specified very technical knowledge of financial planning. But I don't want to and so that forces me to really work hard to try to be knowledgeable and try to learn and try to control my tongue and try to present arguments carefully.

And that forces me to become more knowledgeable. So if you like learning, then teaching is the best thing you can do because it will force you to find your errors and not be intellectually lazy. Now, the other way that you win is with character development. And I'll give you an example from my past work as a salesperson.

Sales is a transformative experience. I've usually throughout my life been in some ways a timid person. I've often been able to express strong ideas and argue with people about things. But in general, over time, I've not had a lot of self-confidence. I've always been a timid person and I've always been very blown by the waves of other people's opinion, wanting to dress a certain way or wanting to look a certain way to fit in with society.

And one of the things that I wanted to accomplish when I started into a sales career is I wanted to learn how to be a stronger person with sales. I read in various personal development books where they said Joshua – or not to Joshua. They said if you want to go out and learn to be a better business person, go into personal sales.

And so I said, "OK, I'll do that." Sales was brutal for me for years, brutal. But I'll tell you one story and I'll tell you a story to illustrate it and talk about a turning point with me. For the first few years of working as a salesperson, it was incredibly difficult for me because I took everything personally.

I think every character quality has two sides. Every character quality can be expressed as a strength and as a weakness. And one of my character traits is – I just personally think of it as likability. I genuinely like people. I'm fascinated by people and how they think no matter how different than they are from me or how weird they are.

I am interested in people. Part of that is natural and part of that is something that was learned. So I studied how to make people like you and that was something that was important to me. And my teachers taught me, "Well, if you want to make people like you, the first thing you should do is like people." So I decided I like people.

So if we ever met, I guarantee in person, I guarantee you that I will like you because I like everybody. Maybe that's too extreme. There's probably a few people I don't like, but I can't think of anybody that I really don't like right now on an individual personal basis.

But the opposite side of that character trait is the need to be liked and the need to be accepted. And so I've often been very susceptible to peer pressure. So in sales, it was difficult for me because when somebody would reject what I was offering them in sales, I would take it personally.

The time that I remember often being set free from that was a time when I was selling – it was a long-term care insurance case. And it was an interesting case because there's this very unique sales opportunity with long-term care insurance where – and the Windows is difficult now because you can't find the product.

But there was – in the taxation of premiums, of long-term care insurance premiums, it varies depending on the situation that you have. And there are some tax breaks for selling long-term care insurance. When you're dealing in sales, tax breaks can be important. For S corporations, there's a certain chart that they work on.

For individuals, there are some breaks, but it's very limited because it has to be over the 7.5 percent of your adjusted gross income. But if you can find somebody who has a C corporation, then long-term care insurance has a very unique tax break on the purchase of long-term care insurance policies.

What's unique is you can purchase the policy. It gets taxed as health insurance, which means you get a full deduction with no limitations on that deduction for the full cost of the premiums. And you can discriminate in the corporation for some key employees. So you don't have to offer it to all of the customers – all the employees like you do with most group benefits programs.

Basically, the general law to remember with taxation of benefits for corporations is if you want to benefit and you want a tax break and you want a deduction, you have to offer it to everybody without discrimination. Or if you want to discriminate, you lose your upfront deduction. One exception to that is long-term care insurance premiums in C corporations.

So if you can find a small or medium-sized business, which is primarily run by maybe one person or a couple of partners, and you can go to the partners and you can find that they would benefit from owning and having long-term care insurance, they can offer it to themselves, to their partners – both what I mean is to their business partners but also to their spouses.

And they can run those premiums through the corporation. They're fully deductible and they can discriminate. Now, what's even more beautiful about it is for a period of time, you could buy long-term care insurance premiums with a very short-term period of premium payments. So sometimes – I don't think there were any products that were available with lump sums but you could pay off the premiums in five years or six years or ten years.

So if you think about this case idea – I had this case on my mind for a long time. If I could find a very wealthy, successful business person who was 50 years old, who had a C corporation, who wanted and needed long-term care insurance, and this person was in a position where they were going to run the company for five or ten more years and then they were going to sell the company.

What they could do is they could put – they could buy a lot of long-term care insurance. They could compress the premiums into about five or ten years depending on the policy design. Then they could deduct fully the cost of those premiums. Then when they sold the company and retired, the policy would go with them personally.

And then if they needed long-term care, the benefit from the long-term care insurance policy was completely tax-free. And I looked for this case because the premiums are huge and when you get huge premiums, you get good commissions. And I looked for this set of facts, a very difficult set of facts to find.

The other limitation was that the company that I was primarily representing their products wasn't offering these products in Florida because they weren't approved by the state of Florida on the limited payment option. There were some other companies that were but it was always a question. So about three or four years into my career in sales, I ran into the case and it was the perfect case.

Wealthy business owner, he and his brother owned the business. It was a car business, very profitable, had been in business for a very long time. He had a lot of money. His brother had a lot of money. They needed – they didn't need the long-term care insurance from the pure perspective that they wouldn't be bankrupted if they had long-term care expenses.

But they potentially valued the benefit. It may have been a want and it was kind of a goodbye. But with the ability to bring the premiums together on what they call limited payment policy design and put it through the business where it was fully deductible but personally owned but fully deductible and then it would go with them after they sold the business, it was the perfect case.

And this client and every stage of – excuse me, this perspective client, at every stage of the process, the perspective client was completely – they were just totally glowing. And it's like at every – in sales, I call it a trial close. Every little trial close, you kind of test to see where your perspective client is and they say, "Yes, I'm into this.

Yes, I'm into this. Yes, this is great." Every sign was A+ did a presentation and the premiums, I think it was – I don't know. It was 35 – it was like 30 and they had a lot. They wanted the Cadillac policy. They didn't want the limited one. They wanted the Cadillac with all the benefits and all the inflation and everything.

And it was something like $30,000 of premium for each of them. It was – I think it was $120,000 of total premium for the four people. Now, when you're presenting, you're used to presenting a few thousand dollars of premium a year and you start to present that kind of premium, it's kind of a change in your mindset.

I had never done it before but the client was just totally into it and their business was at the scale where they were looking at $30,000 a year like it was nothing. And I was excited. Everything went well. It was the perfect set of facts, the perfect product fit, the perfect time in their scale.

Everything went well until I got the phone call and it's vividly etched in my mind. And I was sitting in the parking lot of my office. I know the car. I just got the phone call. The client says, "Joshua, I just wanted to give you – call you back and let you know.

Thank you for the presentation. It was a really great job. We've decided not to buy." And my heart sank because I had put so much of myself into that presentation and I was so excited about it. And I just remember taking it so personally and I'm like, "What did I do wrong?

I did everything right. I tried so hard. I was careful with my sales structure. This was the right situation. This was the right product. The tax code made it perfect. Everything was right and they still didn't buy." And it was tough. That just destroyed me for days. I just was – I don't know.

I wasn't clinically depressed but I felt depressed for days. I could hardly do anything. And because I had put myself into it and I thought the person was reacting to me and they didn't like me. And not – I mean not my psychologist. I'm not on a couch here.

But it was really tough. But that marked a turning point where I started to be able to disconnect from putting myself into my sales presentations. And I realized that the client wasn't saying no to me. They weren't saying no to me because I was worthless. They weren't saying they didn't like me.

They were just saying no to my offer. And I had read about that but it took that experience for me to go through it, to actually learn about it. And it changed the future. And after that, I stopped being so emotionally connected to my sales presentations. I stopped taking it personally.

There's a joke I used to teach the new agents. Like if they're saying no, they're not saying no to you, usually what you find in insurance. They're saying no because they're on drugs. And they don't – everything is like, "Great. They want to buy, want to buy, want to buy," and they disappear.

And you're like, "What did I do? How did I offend this person?" Well, they're doing drugs and they don't want to take a blood test. It sounds jokey but it's the truth in a lot of situations. Sometimes it's you. Sometimes they just don't like you. But that does happen.

But that situation was an incredibly emotionally challenging scenario. But I came out the other side of it and I was a much better salesperson for the rest of the time that I worked in sales. So why do I tell you that story? The point is sometimes in life – and you've probably experienced this far more than I have because you're older than I have.

And I'm just sharing – on this show, I try to be frank and straightforward with who I am and not be anybody but who I am and just share what I'm learning. But sometimes in life, you got to go through difficult lessons. You got to lose the peewee football game when you're little to learn how to lose.

If you never get the experience of learning how to lose, you never have empathy for other people who lose. And it's nice if you can go through the experience of winning. But sometimes losing, you're getting beat up is one of the most incredible experiences. I remember my senior year of high school, the one and only year I played basketball, and our record was something like we won three games and lost 22.

It was an atrocious season. I had a great time. It was the one and year I only played basketball, only played ever high school sports. And I learned a lot. So for me, I'm learning as a young man to understand that when you go through circumstances, the only way you lose in going through circumstances is if you don't learn.

So my character has been strengthened the last week. I've been strengthened. I've learned. And even though I have regrets over I wish I'd done a better job in that show and I learned, I just wish I'd done a better job because I feel responsible if somebody – I don't mind at all being – well, I don't think I mind.

I try not – I don't want to mind if people reject me for what I believe is true, but I don't like to be intentionally offensive for the sake of shock value or something like that. I really feel – I still do – that I did my best to use the best example I could come up with.

I didn't commit any logical fallacies. I didn't – I did my best. But sometimes your best isn't good enough. And that's okay. I get to learn from that. And when you put yourself out there, you never can lose because either you get better or you help somebody else. Sometimes we look at those people who have developed great character, who have developed great wisdom, and we think it somehow happens magically.

It doesn't. I'm convinced it doesn't. The way you develop wisdom is by making mistakes. The way you develop character is by messing stuff up. And so I've learned through the situation. I've learned to strengthen my character. I've learned to build a thicker skin as far as my emotions instead of taking everything seriously.

I think of every person that I interact with on the show, I think of them as my best friend. And then when your best friend lights into you, it's like, "Man, wait a second. You don't know me. I like you. I like you. And we can argue and we can be friends." I've never had an argument that didn't go well in personal life because I usually don't argue, but I also like people.

But I've grown from that. And it does lead me though to the one thing that I did want to mention. I wanted to just partly encourage you, Ray, whether you do it or not is up to you. But I did want to share that with the audience because I know a lot of people face that.

I've gotten several questions on podcasting, specific technical stuff, and I'm going to answer some of those in the future. But I wanted to answer this directly because I know many of you have something that you know something about. And you want to go and help someone else and teach someone else.

And there's no training for this. I couldn't find any training when I started doing radical personal finance. There's no training for learning how to deal with these things. You just got to go and learn. But if you commit to be humble and honest with what you're learning, I believe that's what's missing in a lot of communication.

I think most rational people don't mind it when people make mistakes. There are always going to be all kinds of crazies who just get their kicks off of tearing people down. There are legitimate sociopaths and – I don't know what the right technical term is. But there are legitimate people who gain joy out of tearing other people down.

And then there are people who sometimes when you learn something, it's deeply distressing. Just think of how – again, I think of how angry I was in college when I was confronted with the fact that my worldview was broken. And I didn't have a consistent response. And that sparked a transformation in my life, a complete and total transformation that I'm still working on.

So don't be scared to lose because if you believe in absolute truth and you believe in the value of the person, which is a question. Many people don't. Then you can't lose for learning. And the way you lose – that's kind of fun. I didn't – like the only way you lose is if you don't learn.

And there are a lot of motivational posters and things that will show somebody at the end of their life and they'll talk about the regret. And the regret was this person died with their music still in them. Or the regret was that they could have been a different person but they didn't.

Well, you know what? It's stuff like this that keeps people from doing it. And I think more people should not die with their music in them. I think more people should fight for what they think is right, should learn how to debate, should learn how to argue and should learn – we should all just simply be learning from our mistakes and getting better.

So I guess that's kind of motivational speech partly for me, partly for you. But don't let – my point was I learned a lot from sales. And it gave me – I didn't necessarily feel good when I was going through it but I understand what those writers of personal development books were saying.

Because once you've gone through sales and you realize then that I can learn to talk to anybody, then a job interview never phases you. I used to joke about – when my friends were going for a job interview and they're nervous, I'm like, "I go on four job interviews a day.

Someone who doesn't know me, I got to walk in and figure out how to help this person talk about the things they're scared to talk about and they're ashamed of, which is their money. So a job interview is the least stressful thing in the world for me. But the learning doesn't come easy.

You got to go through certain things." So, Ray, that's partly for you, partly just for other young people in the audience because I know there are a lot of younger people, younger than me and young people like me. It does lead me to – the one thing I do want to make an apology.

The one thing I regret about that show and I want to apologize for publicly here and now. I can't remember if I apologized for it in a previous episode but regardless, I want to make sure I do it now. The one thing I regret about that show is my closing jab.

Well, the major thing I regret was my closing jab. Closing with an insult and calling Madsen and Hunter cowards was not right. It was juvenile. And my youthful emotion got the better of me. It was a foolish insult and I'm sorry for it. It is important to me that people are clear in their presentation.

And I get so tired of the marketing and the lies and just the lies. I hate it. And I let my emotion at that time get out of hand. I apologize to those of you who are listening. I feel like it weakened my presentation and it caused – and it was one of those direct emotional attacks and it just came from youthful foolishness.

So I apologize for that. I will try to do better in the future. And so please accept my apology if that was something that bothered you. All right. Let me go ahead and I'll stretch the show out a little bit and if – I'll go ahead and stretch the show out and I'll answer the last question here.

The reason I'm quivering here and quibbling is there's this challenge of expectations of doing a daily show versus sometimes I just do a lot. So is it more important that I do a daily show that's 20 minutes long or is it more important that I just do it all at once and allow you to hit pause on your show?

So let's consider this the example of if I don't – I try to do a show every day. But if I don't do a show every day, then recognize some of the shows are long. I have a real conflict here over what I've said in the past of I try to do a show five days a week but then sometimes I don't.

And so then the question is what's more important. So that's why I'm quibbling here. But I'm going to go ahead and try to remove those expectations. Just say I'm doing the best I can to provide you with as much content as I can. And sometimes it's multiple shows and multiple days and sometimes it's long shows.

Let's boogie on. So I'm going to go ahead and answer this question here. There's actually two questions regarding my investment strategy. First question was from Ryan and he said, "Joshua, during episode 181, you mentioned you don't have your money in the markets for moral reasons. Where do you put your money and have it grow in line with inflation or better yet, beat it?" So I'll answer – this is a fairly quick question, Ryan, but it is important.

I didn't intend to talk too much about this until I described why but it kind of popped out in that show. So I know I didn't answer it as far as tell you my strategy. So we'll start with the inflation strategy and the next question is more in detail of what I'm actually thinking of.

This has been a very long time in coming and I'll cover that in a moment. But all of the money that was previously invested in mutual funds is just simply sitting in cash right now, in a money market account, in the various accounts in which I have the assets that are paper assets in my life.

It's just sitting in cash right now while I decide what to do in the future. I have some ideas about where I want to go and I have some clear ideas but I'm also in a time of transition. But I'm not worried about the money sitting in cash right now for the short term.

Here's where there's always a balance with investment information. If I were a financial advisor trying to sell you mutual funds, then I would very much focus on why you can't have your money sitting in cash because of inflation. But if you had a specific reason why you have your money sitting in cash, then that argument goes out the window.

So right now I'm in the process of restructuring my own personal investment plan and I'm in a very kind of interesting in-between process with this new business with Radical Personal Finance. It is working but it hasn't worked yet. It's starting to get there but it's unknown and it's not gone necessarily – it's gone faster in some ways than I expected.

It's certainly grown much more than many businesses similar to mine have and do. But I've struggled to effectively execute on some of the things I've wanted to do. So I'm in an awkward position of not knowing. Depending on what happens with Radical Personal Finance, that will influence some of the other things that are in my life and the other investment decisions that I want to work on.

Inflation in the short term is generally not that big of a deal or at least I'm not worried about it for me. Specifically right now, inflation is essentially nonexistent. The Federal Reserve has stopped inflating. They're no longer doing buybacks. And so right now the inflation rate in the US is fairly steady.

Now, you can certainly go and find people who disagree with that and who write emotional essays about why that's all baloney. But it's fairly steady right now. Even if it weren't steady, even if we were in a situation of, say, 5% or 10% of, say, mass inflation – 10%, 15%, 20% – not hyperinflation but mass inflation.

Even if it weren't steady, I still would do what I'm doing right now on the short term. Now, if I saw that mass inflation coming on, then maybe I would go ahead and look at the things that I can do or things that I want to do. And I would move more quickly.

But right now in 2015, on April 30, 2015, which is when I'm recording this show, I'm not concerned about it. There are major – I see major long-term structural problems in most of many large-term – large economies in the US economy. But that's not short-term hysteria where by the end – I don't see it by the end of June myself where all of a sudden we're going to deal with Zimbabwe hyperinflation.

Not going to happen. So it's more important to me that I have flexibility in the short term to kind of reorient myself and embark on my new plans than that I worry about one year worth of inflation of me sitting on cash for a year when – in a scenario where inflation is basically nonexistent.

That would be different if I were sitting on cash for 30 years. Traditional 3% inflation rate over one year, negligible impact. Traditional 3% inflation rate on cash over 30 years, massive impact. And so for right now, inflation is not a big deal for me because this is not a permanent thing, and the cash is simply dry powder.

Also importantly is I'm not at the stage in my own personal finances where I can be financially independent purely off of my investments. So it's easier for me – the primary thing that provides my livelihood is my income. So it's easier for me to sit by for a year or so and wait than it is for let's say that you are 65 years old and you're retiring.

Well, now we're in a different situation. So that's why in my financial life I can go ahead and not worry about inflation for a year. If you're at 65, you also could probably not worry about inflation for a year. But if you're retired, you need a plan, and you probably should have made it by 65 or you shouldn't have stopped working.

I haven't stopped working. I'm just adjusting my investment strategy. And over the course of a year, if that's what it takes me to reallocate and reorient and work on my new plans, then it's okay. Inflation is not a big deal in the short term. Big deal in the long term, not a big deal in the short term.

Let's go with the second question here, which we'll get into more details. This comes from Jeff. "Joshua, I very much enjoy your show and I took in the marathon of show 181. Thank you for using such controversial material to make your point. There's not enough genuine debate and too much simplified propaganda from all sides in this country.

One point that stood out to me from this particular show is your personal approach to investment for your own evil – excuse me, for your own family. My question is if your position on investing in large evil public companies is so strong that you would not personally invest in them, how do you justify working in the financial industry, advising individuals on their investments in those same publicly traded companies?

I'm assuming that you are or will be engaged in that financial advisory role. Could you also please touch on the investment categories that you are or will consider for your family's financial plan, generally speaking, of course? Keep up the good work. Your show continues to be a source of excellent information and your delivery continues to improve.

Regards, Jeff." So, Jeff, good questions both, and let's start with the one about how if I think that investing in large so-called evil public companies is so – and I'm opposed to that, then how would I justify working in that industry? A couple layers to this answer. First of all, I'm not working in the financial advising industry.

I'm not advising clients on their investments. I have no connection at this point other than the fact that I talk about finance and I have a consulting arrangement with a financial advisory office. Other than that, I have no connection to the industry. So, I don't actually have that problem.

And I am not sure if I will ever return. That being said, I'm not necessarily saying that what's right for me in this case is right for everyone or is not right for everyone. For me, this change that I talked about on a recent show has been a very long and slow-moving change.

If you would come to me a few years ago and said to me, "Joshua, you're going to do this thing," I would have said, "Of course. Come on. I'm not going to do that." But part of that would have been because I just didn't feel as strongly then as I feel now.

I didn't have the exposure to different information that I have now. I hadn't had enough time for things to percolate. But also, I would have had a very difficult time overcoming my own personal bias against even considering that that's the case because I was a financial advisor. And it's very difficult as a financial advisor, one who wishes to operate ethically and in a straightforward way, it's very difficult for me to come to the position of, "Yes, I'm uncomfortable with investing in these companies, so I don't do it.

But I'm going to tell you as a client to do that." That would be a difficult position to take. And I don't know -- we can perceive some of our own personal emotional bias, and some of it we can't. But I don't know if I would have done that when I was a practicing financial advisor.

I do know this. I've -- moving to radical personal finance had many reasons, and this was one of them. It wasn't the primary reason. I could have worked out and, for example, let's say that I had come to the same conclusion. I could have come to that conclusion as a financial advisor charged with the custodianship of assets, and I could have made moves into a different investment strategy and offered that to clients to come with me.

Many advisors have done that. Look at -- I don't know who's controversial. Peter Schiff. I don't know fully, but I bet Peter Schiff probably started as a mainstream, and then he became kind of the voice in the wilderness, so-called, out talking about the evils of the American empire. You can structure a portfolio, and my objection is not necessarily to owning publicly traded companies.

My objection is to owning mutual funds where the advisors managing those mutual funds don't have the same standards that I have. I am not saying that every large publicly traded company is wrong or that everyone is right. I'm saying that many of them, which were making up the dominant portion of my portfolio, are actively engaging in activities that I am no longer comfortable with, and I do not want to profit from their activities anymore.

So I could maybe have made that transition in my own personal comfort level. It's very long, very slow. I'm not saying to anybody else what you should or shouldn't do with your money. I'm just saying for me, and this is one of those areas where some questions of ethics and morality are very clear and objective perhaps if you believe in such things.

You might find some things clear and objective. I certainly do. I find some things to be clear and objective. And other things I find to be more questionable and subjective. And where that line is will vary depending on our outlook, and it will probably vary throughout our life. Maybe in the past I might have drawn that line differently, and maybe in the future I'll draw it differently.

I can only share out of where I'm at right now. So maybe I could have made the change while I was working as a financial advisor, but at this point I'm not. And that gives me a little bit more freedom, and I gave some time for those moral questions to kind of subside and say, "Was that just a reaction or not?" And then finally I decided it wasn't.

But even the financial industry – I tried when I got into the financial industry. I tried to make a very careful decision that would be something that would be comfortable with what I was all right with. I looked at – for example, I looked at the big wire houses, and I refused to join them because I didn't like the culture.

And I'm glad I made that decision. I made a good decision by not joining that because I was uncomfortable with the practices of some of the companies. And I didn't – both at the specific advisor level and also at the larger corporate level. I think you've got to be careful and make sure when you get involved with large corporations, you are going to be throwing your lot in with the corporation.

That may or may not be good for you. I didn't join – let me see. I won't say the name, but I didn't join the company that has the bull because I wasn't comfortable with their perspective and I wasn't comfortable with the corporate practices. Well, now that bull is owned by a major bank, and I'm not comfortable with a major bank.

I don't want to own a profit based upon the actions of that bank. I think a lot of what they do is criminal. And what's interesting is I saw that years ago, but now that's filtering down. And so I have friends who recently left that company who left because some of the shady banking practices have moved over onto the investment side.

And those friends finally got to the point and said, "You know what? That's it. I'm leaving," and went to a different advisor. So this is a very much real and current day. Now, I also have friends who joined that company and found out that, well, we've got cultural problems.

And the challenge in working as a financial advisor is that it's hard to find one massive large company that is going to operate in an ethical way. It's more about the individual teams. This is why it's so hard for me to say here's how you find a good financial advisor because there are good financial advisors at every firm and there are bad financial advisors at every firm.

And it's largely about the person or the team of people that you're working with. When I joined Northwestern Mutual, it was specifically because of the culture in my specific office. And that I made a good decision. The culture in my office was excellent. But some of the larger changes in the company, they're going with the flow just like every large company is.

They are adjusting their corporate culture in order to maintain their mainstream appeal. Well, I believe strongly that they should have the right to do that. And I also believe strongly that I as an individual don't necessarily need to follow what they want to do. Big companies have to force compliance with their overall code and direction.

When big money gets involved, most large companies stop taking stands on any kind of principled issues. Unless those principled issues are popular and they can gain some kind of large social popularity from it, they stop taking principled stands. Watch the politicians. Watch how the vast majority of the politicians, they'll only take a principled stand when the issue is popular.

And there's this tiny, tiny, tiny minority of politicians who almost never get elected who will take a principled stand no matter what. Those are the people that I applaud. No company CEO of a large company wants to be on the front page of the newspaper. So what you find more and more in large corporate culture is corporate culture is subject to broader social culture.

And very few companies stand for a principle. Now, everyone markets their principles. But, man, look behind the marketing and they continually change. It's all about their appearance. A friend of mine who's a financial advisor – and we were just talking about this recently – and he joined one of the large wire houses.

And it wasn't a particularly good fit, but they brought him on the team because he's black. And they needed a black guy to promote their diversity initiative because a company has to promote their diversity initiative. And one of the black eyes on the financial industry is that the societal statistics as far as the makeup of financial advisors is far more likely to be skewed in the direction of males who are white and who are old.

So there's this massive problem that the large financial advice companies have in that their majority of their advisors are old, white men. And yet the money is changing hands, and it's not in the hands of men. Women control more money than men, and it's not white anymore. And even those who are white don't necessarily want to work with old, white men.

And so my friend, he gets into this scenario and he gets into this team. And the only reason the team wanted him – it was terrible chemistry between him and the team – but the only reason the team wanted him is because they needed to fulfill their diversity quotient.

They needed him because he was black. Now, thankfully, I'm proud of him. He left, and he wants a team where he fits not because he's black but because he's good. So it's largely about appearance. Now, I'm not touching – today I'm tired of dealing with sensitive issues. I'm not touching any of that nonsense today about racial and diversity stuff.

It's not my problem in the sense that it's not – I'm not running one of those companies. I don't have to deal with that. I do know that the independent people are changing that perspective. Most of the people that I know who are young financial advisors that are starting that don't look like what old financial advisors look like.

But the business has a problem. My point is that they've got to market their appearance and they've got to make their change. Right or wrong, whatever you feel about that, it's all about the marketing. I could just get sick of it. I get sick of the lobbying. And more and more I'm convinced increasingly that we live in a – I don't know what to call it, a corporatocracy.

You pick the term that you want, crony capitalism or fascism or whatever, but you see this everywhere throughout society and the financial industry is no different. And the financial industry has a lot of sleaze in it and the money attracts it. And so it's possible that I could go back to the financial industry in the future, but I'm convinced it would be very difficult for me to go back to some of the medium or large firms.

Because the medium or large firms, they have to keep their corporate image and that's normal. And as an advisor with a medium or large firm, you are responsible to help your company keep a corporate image. You are an employee of the company. And so you have – you feel that pressure.

And if you say one thing wrong or do one thing wrong, it's not just you who bears it. It's your firm who bears it. And in any large corporation, that firm, that firm culture is going to bring it to bear. So it is a valid ethical question to say if you have this feeling, how can you work in the financial advisor business?

I've come to the conclusion that it would be very difficult for me to work with some of the larger firms because it's a lot – with many of the companies, it's largely about marketing their principles without actually standing on principles. And I came to the conclusion that the best way for me is to run my own firm.

I think we're increasingly headed in the direction of decentralization. It's challenging in the investment space – excuse me, challenging in the insurance space especially because there's a certain scale that insurance companies need. And so it's more risky to buy insurance policies from a small insurance company. But with a larger company, as far as especially in the investment space and with an advisory space, we're moving in the direction of decentralization.

It's a lot easier now to run a small independent firm than it ever was in the past. And I think ultimately that's going to be a win for clients because there are a small number of people out there who will search out people based upon their principles. And the ability for people to specialize with a specific subgroup of people who have certain principles no matter what they are is better than it ever was in the past.

So I'm generally optimistic because whether or not you agree with me or whether you completely disagree with me, the great thing about the future is we have the opportunity for things to be competitive. Now, it's a rough transition. So don't expect it to be easy. But we do have an opportunity.

Now, I do have some backup plans. So there are a few small local wealth management firms that I know of that I could work with. So if Radical Personal Finance were to fail and I were to decide to not run my own firm, I am attracted to some of the small local family offices.

And then there are a few of the private trust companies that I would feel confident in working with. And I probably could go back and work with the Northwestern Mutual office that I used to work with. It's just because – I mean it's a great office. But I like the family office model.

That to me really appeals to me because if you work in a family office as an investment manager, you get to do all kinds of interesting things for one family or for a multifamily office, one wealthy family and serve one family. So I like that and I'm in – not the capital of that, but I live in Palm Beach where – I live in West Palm Beach where we're right near that.

It's a perfect place for that. But my burden is for the larger population and to do what I'm doing with the show, which is to teach people. But if this doesn't work, I'll go either run my own small firm where I can do things how I think they should be done or I'd go and join either a family office or one of the local trust companies that are very conservative and that have a specific perspective on what they do.

Now as far as what my plans are, I'll cover more of this in future shows. I have a couple questions that will allow me to get into it. But I'll give you a quick answer. You said what investment categories are there that you need? So number one, the number one investment category that I first look to and I think we should all first look to is what are the actual physical needs of my family?

So as an idea for this, not as a prescription but as an idea, as a mental way of thinking this through, think how can I reduce my dependence on the systems of the local economy as they pertain to finance? So think off-grid. When I say buy mango trees, I mean go buy mango trees or whatever the version is in your local area.

Now, obviously, you're not going to invest $100,000 in the mango trees. So I mean it literally but I also mean it conceptually. So as a metaphor, is there something that you could do that will actually provide for your needs? And so I think about this a lot. Simple example, my house has terrible insulation.

It's just horrible. I live in Florida where we need good insulation for the AC bills and my house is not designed to live without AC. So investing money into reducing my electric bill is a very important aspect of investment. Things like this we often don't consider to be investing in our current day and age.

But I think if we apply that mindset, it can be a useful way to think. If the purpose of investing is to provide for our living needs, then we should look to see if we can provide for our living needs at a cheaper price than doing everything through the financial system.

That's the point. Now, you have obviously challenges with amounts of money. Again, you're not buying $100,000 worth of mango trees. So the good news and the bad news about this is A, you don't need $100,000. So if you don't have $100,000, then we can just simply get by with less.

A mango tree is $25. But you also get to the perspective of, conceptually, is there a way I can do something larger scale? So I live in a high-tax area. I feel like I need to be here. And so I can't go – I'm not going to go and move off-grid and move to the hills of Wyoming and set up an off-grid house even though I could.

I don't feel like that's what I should be doing right now. I want to be here, and this is the community that I'm a part of, and I need to serve them even though it's expensive. So I can't go off-grid – using that again as a metaphor – I can't do that here in West Palm.

It doesn't work very well. But I still think about it, and that's something where I can always focus on. The other problem with this is, of course, what if I have the money in my Roth IRA? I'm obviously not going to put solar panels inside of an LLC and then own that LLC inside of my IRA, although I'll have to think about that and run a self-directed Roth IRA that owns and leases out the solar panels on my roof.

No, I'm not quite comfortable with that, although maybe some of you are, but that's just a night that comes to me off the top of my head. So for me, the investment category is, number one, the physical needs of my family; number two, privately owned business, and this is a big one.

I don't want to retire. I don't have any desire to do nothing, but I do need independence and autonomy. I need control over my day. And so here private business does this for me. I don't see any benefit to working less. I think work is good for me. I do see the benefit of working flexibly, and so for some people that can happen in an employee situation.

For me, it's important that it happen in a business perspective where I want to be the boss and I want to have something where I can come and go and deal with things as they come up on an hourly basis. This is why I've resisted saying I publish the show at 8 a.m.

every day. I don't want to publish the show at 8 a.m. every day. And maybe that would have benefits, but it would require me and take away some of my flexibility. So business and private business has the opportunity to buy lifestyle at a far cheaper cost than buying it based upon external investment.

It's easier to live a good lifestyle with your own business than not. Think of this from the perspective of a simple example of passive income. When I closed my firm with Northwestern Mutual, I had – what was it? I would say I had somewhere depending on the month, $3,000 to $4,000 of passive gross income into my practice.

There were lots of people that had lots more and there were lots of people that had lots less. That was kind of median middle of the road. What it means is that was money where if I never brought in a new client or did anything, I had the ability to have that amount of money flow in the door, and that's money that could be spent.

I was just at the point where my investment business was my major focus and that was going to be growing substantially. And so that number very easily could have gone from $3,000 to $4,000 a month to $7,000 to $8,000 a month with a couple of years of work. So let's just stick with what I actually did in about five to six years.

Well, six years, right? So in the last year, I didn't work very much. Let's just simple – let's use $3,000 a month. You go out and you set up an insurance agency and you set up to where you have $3,000 a month of renewal commissions or investment business. This is why the investment business is so attractive.

$3,000 a month, let's use a 4% rule. Multiply that times 300. And $900,000 of capital would be needed to provide that money. When I started, I was barely – didn't have much money and I was 23 years old. What's easier? To go out and from 23 to 29 build a financial planning practice that makes $3,000 of passive income or from 23 to 29 go and work and save $900,000 so that I can live off of $3,000?

Building the business is easier. So it's exactly the same thing I'm doing with radical personal finance right now. What's easier? For me to go out and work and save $1 million or $900,000 to make $3,000 a month or to focus on creating a product, finding people who benefit from the product, marketing it effectively, learning what I need to learn and find $3,000 of income from my Patreon supporters?

It's a lot faster of a habit. Now, this doesn't make – excuse me. It's a lot faster of an approach. Now, this doesn't make the idea of investing for income obsolete. Ultimately, at the end of the day, I'm still stuck doing a show every day. So I need in the process, once I get the $3,000 a month set up from Patreon and once I write something, write a book that I sell you or write a course or something like that or bring on an advertiser or whatever, once I get that set up, then I need to still be investing the surplus.

Because ultimately, if I compare the trouble of maintaining the $3,000 a month from this business versus the trouble of having $3,000 a month from an S&P 500 index fund, which violates the whole concept of what we're talking about, it's a lot easier to do it with the business is my point.

Now, I've got a bunch of business ideas, things that I'm interested in doing. Very few of them are based upon them being super lucrative. But all of them are being based upon things that I think should be done and things that I think would fit well into a lifestyle.

So I mean, I won't go through all of them. But simple example, I'd like to run a beef ranch. I think we need more grass-fed cattle operations in Florida. And very few seem to be able to be doing it. But we have like the most brilliant place in the world to do grass-fed cattle.

And I think that would be a lifestyle that I would enjoy. I like animals. I like driving around in a pickup truck in the fields and playing with cows. That's fun. I don't know if it would be fun for a long period of time. It might just be fun because it's kind of this romantic idea.

But I had a client of mine who was a cattle farmer. I'd go up and spend time with him and his lifestyle appeals to me. Advantages and disadvantages of it. But something like that, I'd rather invest the money and run a grass-fed cattle operation because I can get multiple benefits from that.

I can get a business that provides for my lifestyle. I can make money. And I can provide a service to the community. I can provide work to people who are discriminated against, who have trouble finding other work. I can provide opportunities for people to learn. So that's what most excites me is the ability to operate private businesses.

And if I can learn and hone my business skill, which I don't currently have as much as I need, but if I can hone my management skill and get these things running more smoothly, then these businesses have multiple benefits. The final two things is just simply small local real estate investment.

That can be a real benefit to me and that's one of the other things I'm considering. I believe I can overcome the things that aren't a good fit for my personality and I can get enough other benefit from buying rental houses locally that it's worth it. Now, I'm not ready to do it right now.

And the reason I'm not ready to do it is because it takes too much time to run radical personal finance and I don't have this thing firing on all cylinders yet. So once I get this business firing on all cylinders and I feel like I can operate it with fewer hours per week, then that will open up the ability for me to go and focus on buying rental houses.

The deal with rental houses is the ethics are much lower in the sense of the conflicts of interest between me and what Walmart decides to do with their corporation. I'm much more okay with dealing with it on a local scale with rental houses. Additionally, when I look at the benefits for my family and I look at the fact that I've got two little babies and one is preborn and the other is still just a baby, but I'm thinking about what do I do with a 15-year-old teenager?

Well, I need something tangible where he and she can connect and have the opportunity to work and have the opportunity to learn lessons. And so when I look at the benefit of owning a rental house, it's going to require work and upkeep and things like that. Even though I don't love to do that, as a teaching mechanism, that can be super important, and I can teach them instead of here, buy a mutual fund.

Not that the mutual fund isn't beneficial, but I can get multiple layers of benefits off of that that I can't get off of other things. Finally, the other investment category is individual stock investing, individual stock selection. I'm comfortable with doing this. It's not going to be my first thing.

I've never done it as far as actively worked at it as an investor. I know enough to know the philosophy that I would use and the approach that I would use if I start doing this. My challenge is simply I don't have the personal makeup for me to – I don't have that burning desire that a lot of people have that makes them successful with trading or owning individual stocks.

I'm not a trader. I don't want to sit around and watch to see what's happening with a trade. That's not me. Even though I think some people can do it, I don't want to do it. And since I don't want to do it, I'm doing the patootie-doff and I'm going to do a bad job with it.

I would be – if I were to purchase stocks, I would be a – well, I'm not a trader. So that – I just – some people like it. I don't. I don't want to sit around and read and follow everything. I'd rather – a lot of things I'd rather do is my point, so I'm trying not to go into all of my personal opinions on stocks maybe another time.

So that's what I got. It's going to take me time to work through and figure out exactly how to approach all these things. But at the moment, everything is so tenuous with radical personal finance where, again, it's not hitting on all cylinders yet, but it's not a failure. That I'm just buying time to wait and sometimes having time to wait is the biggest thing, which is why everything is sitting in cash.

I've got ideas and plans and I'm working on my ideas and plans as quickly as I can. But I think I'm making a wise – I think I'm making wise, rational decisions and that's why I'm doing it. Time will tell. Time will tell if it's a good decision or not.

I could either be kicking myself or be ecstatic with myself. But I'm no different than anyone else. I don't think we ever know what decisions we make, whether they're good or not, until time comes. We could feel confident about them. I've felt confident about some bad decisions and I've felt inconfident about some good decisions.

So time will tell. It's nice of you to be interested. Hopefully, at least, hearing how I've been thinking through my situation is helpful to you in your own unique situation. It's been fun for me. Thank you so much for listening. I appreciate this. I love answering these questions. It's really fun.

I've got a balance answering the questions with all of the other types of shows that I like to do. But it is nice that questions oftentimes allow me to talk about me, which is obviously gratifying and it's hard to talk about you sometimes. Anyway, I appreciate the interest. Thank you so much for your support.

If any of you just finished, actually, the monthly patron Q&A on monthly live Google Hangout, finished with the patrons, I was in the middle of recording this show. My calendar flashed at me and I'd forgotten that I would… this show went on so much longer. I'd forgotten that I had it scheduled and I had to pause and scramble and go and answer and do the patron hangout.

But that was awesome. I really enjoyed doing that. We had some good questions, had some good fun with the patrons. So if that's a benefit that you would like or if some of the other benefits hanging out in the Facebook scenario and the Facebook group with the regulars of the show, that's where I've been answering a lot of the questions about Episode 181 and where we had a lot of feedback and really great feedback.

Thank you to those of you who are in that group. Go to RadicalPersonalFinance.com/patron and you will find all of the information on those options right there for you. Cheers, y'all. Thank you for listening to today's show. Please subscribe to the podcast with our free mobile app so you don't miss a single episode.

Just search the app store on your device for Radical Personal Finance and you'll find our free app. If you have received value from the content of this show, please consider becoming a patron. Your financial support is how I pay the bills for the show and how I plan to grow our content.

You can support the show with as little as a dollar a month or as much as you feel the content is worth. Details are at RadicalPersonalFinance.com/patron. If you'd like to contact me personally, my email address is Joshua@RadicalPersonalFinance.com or connect with the show on Twitter @RadicalPF and at Facebook.com/RadicalPersonalFinance. This show is intended to provide entertainment, education, and financial enlightenment, but your situation is unique and I cannot deliver any actionable advice without knowing anything about you.

Please, develop a team of professional advisors who you find to be caring, competent, and trustworthy and consult them because they are the ones who can understand your specific needs, your specific goals, and provide specific answers to your questions. I've done my absolute best to be clear and accurate in today's show, but I'm one person and I make mistakes.

If you spot a mistake in something I've said, please come by the show page and comment so we can all learn together. Until tomorrow, thanks for being here. With Kroger brand products from Ralphs, you can make all your favorite things this holiday season because Kroger brand's proven quality products come at exceptionally low prices.

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