“Mr. Beaver, I am finally starting to earn real money in my medical practice but don’t know the first thing about investing. I need concrete advice on handling money, building wealth, but don’t want to become a slave to money.
“I have met with financial advisers, but lack a grasp of the terms they use and, frankly, am afraid of looking stupid, so I don’t ask them to explain. Do you know of a book that is meant for people like me, who need a basic education in personal finance, but that has a ‘human’ touch as well? Thanks, Karl.”
I just finished reading the answer to what Karl is searching for. It’s Your Total Wealth: The Heart and Soul of Financial Literacy, by former university business professors Lyle Sussman, Ph.D. and David Dubofsky, Ph.D., CFA.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
For anyone starting out in life, Your Total Wealth is the ideal read. It is the most unique and accessible financial advice resource I’ve ever seen and goes well beyond how to make money.
The authors give us a window into what “total wealth” means, how to achieve it, and demonstrate that it is much more than mere numbers. Total wealth is greater than the “stuff” we own or the balance in an investment account.
I wish that I had this book years ago, or as I tell my friends, “When I had hair.”
Applying Financial Definitions to the Real World – An Emotional Annuity
Your Total Wealth has a feature that I’ve never seen before. Pages on the left provide definitions, such as, Margin, Short Selling, Dollar Cost Averaging, Leverage – terms that most people do not understand, with examples. Pages on the right give readers a life lesson connected to the term just defined. Here’s an example from the book:
Annuity: A financial annuity is a predictable payment stream, such as a retirement annuity offered by insurance companies, designed to pay for as long as you live.
The Life Lesson: An emotional annuity is a predictable, human bond of caring, commitment and concern. It says, “I’m here for you.” The next time you see an elderly couple walking down the street with smiles on their faces, holding hands, you are witnessing an emotional annuity payment.
When adult children take care of aging parents, those children are making an emotional annuity payment.
Your Total Wealth is filled with insights like that, financial terms and life lessons that get you thinking about living a richer life.
The Search for Monetary Wealth Has Its Own Costs
I asked the authors to discuss some of the things people do in the pursuit of financial wealth that lead to disappointment and failure in life.
Sussman: Failure to understand the cost of obsessively focusing on monetary wealth.
Consequences: Think of the Midas touch parable. If you are consumed by making money and greed, realize the cost you’ll pay. You lose family, self-esteem, happiness. These things often become unintended consequences of acquiring financial wealth.
Yes, we need money to live comfortably, but studies show that when our basic needs are met, more income does not mean greater happiness. I have met millionaires who admit missing something despite their great monetary wealth.
Dubofsky: Failure to be happy in your job and constantly chasing higher-paying jobs.
Consequences: You will pray for Fridays and hate Mondays! People with total wealth understand they must actively earn money in a way that does not result in losing the things they enjoy, friends and family. If you are madly working just to pay one bill, another will be due later in life.
It is the one that asks, “Did you achieve a balance between acquiring financial wealth and personal fulfilment? Did you wake up every day happy to go to work”?
It is the fortunate person who realizes early in life what results from being dedicated to income alone. They have the wisdom to look into the future, when they are older. And they ask, “What will be my legacy?”
Sussman: Using credit for the wrong purposes. Borrowing money to go on an expensive vacation. Buying something unnecessary that you can’t afford.
Consequences: You will forgo future financial security. Borrowing money for a house is a sound use of credit, but not for an unaffordable vacation. Leasing a car is fine – but don’t go overboard and lease something well beyond your means just to look successful. There are lots of “successful” people in bankruptcy court.
After reading the book, I can see it has a lot of sound advice that can help many types of people. Your Total Wealth is about living and how to use money to improve our lives and the people we care about. Giving a copy to young, new clients, would be a great way for a financial adviser to begin a professional relationship.
-
Top Tech Gifts to Grab at Walmart Before ChristmasBig savings on Apple, Bose, HP, Vizio and more while there's still time to shop.
-
AI Appliances Aren’t Exciting Buyers…YetThe Kiplinger Letter Artificial intelligence is being embedded into all sorts of appliances. Now sellers need to get customers to care about AI-powered laundry.
-
Ask the Editor: IRAs, 401(k)s and RMDsAsk the Editor In this week's Ask the Editor Q&A, Joy Taylor answers questions on IRAs, 401(k)s and required minimum distributions
-
Quick Question: Are You Planning for a 20-Year Retirement or a 30-Year Retirement?You probably should be planning for a much longer retirement than you are. To avoid running out of retirement savings, you really need to make a plan.
-
Don't Get Caught by the Medicare Tax Torpedo: A Retirement Expert's Tips to Steer ClearBetter beware, because if you go even $1 over an important income threshold, your Medicare premiums could rise exponentially due to IRMAA surcharges.
-
I'm an Insurance Pro: Going Without Life Insurance Is Like Driving Without a Seat Belt Because You Don't Plan to CrashLife insurance is that boring-but-crucial thing you really need to get now so that your family doesn't have to launch a GoFundMe when you're gone.
-
I'm a Tax Attorney: These Are the Year-End Tax Moves You Can't Afford to MissDon't miss out on this prime time to maximize contributions to your retirement accounts, do Roth conversions and capture investment gains.
-
I'm an Investment Adviser: This Is the Tax Diversification Strategy You Need for Your Retirement IncomeSpreading savings across three "tax buckets" — pretax, Roth and taxable — can help give retirees the flexibility to control when and how much taxes they pay.
-
Could an Annuity Be Your Retirement Safety Net? 4 Key ConsiderationsMore people are considering annuities to achieve tax-deferred growth and guaranteed income, but deciding if they are right for you depends on these key factors.
-
I'm a Financial Pro: Older Taxpayers Really Won't Want to Miss Out on This Hefty (Temporary) Tax BreakIf you're age 65 or older, you can claim a "bonus" tax deduction of up to $6,000 through 2028 that can be stacked on top of other deductions.
-
Meet the World's Unluckiest — Not to Mention Entitled — Porch PirateThis teen swiped a booby-trapped package that showered him with glitter, and then he hurt his wrist while fleeing. This is why no lawyer will represent him.
