“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.
Sign up for Kiplinger’s Free E-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.
-
Biggest Winners and Losers in Trump's New Tax PlanTax Law Trump’s mega tax overhaul, known as the ‘One Big Beautiful Bill,’ has distinct winners and losers. Which group do you fall into?
-
Want To Retire at 65? See if You Can Answer These Five QuestionsDaydreaming about retiring at 65? Use this checklist to see if you are ready.
-
Five Things to Consider Before Rolling Your 401(k) into a Roth IRAConverting at least some of an old 401(k) to a Roth IRA can offer long-term tax benefits and retirement flexibility, especially if you anticipate being in a higher tax bracket later or wish to leave a tax-free legacy.
-
From Dream Apartment to Nightmare: When Your Landlord Evicts You Through No Fault of Your OwnThis is what I suggested a tenant do to get out of her lease after her landlord's inexperience and lack of action made her rental situation unsafe. It's a legal situation called 'constructive eviction.'
-
Six Steps to Being Empowered and On Track: An Expert Financial Guide for WomenWhile most female investors feel on track with their financial goals and empowered by managing their investments, many regret not starting sooner. Here's how you can get started and take control of your financial future.
-
Selling Your Business? This Powerful Insurance Option Unlocks Multigenerational WealthPrivate placement life insurance (PPLI) offers almost unbelievable investment flexibility, estate planning and tax advantages. And it's completely legit.
-
How to Maximize Your Social Security Now That the One Big Beautiful Bill Is LawWhen applying for your Social Security benefits, consider the new enhanced deduction for people age 65 and older, as well as your health, family situation and other financial issues.
-
I'm a Retirement Specialist: This Is How to Keep Your 401(k) on Track Amid Dire News AlertsHistory shows that consistent, disciplined investing far outweighs any attempt at market timing, so focus on long-term growth and tune out the sky-is-falling news headlines.
-
Five Money Moves to Make Before Your First Child Arrives: A Financial GuideI wish I'd known some of these when I was an expectant parent. These important steps include establishing an emergency fund, budgeting for new expenses, securing life insurance and more.
-
Retirement Tax Bombs: How Roth Conversions May Cut the Blue WireIf you have a significant amount in tax-deferred retirement accounts, you could be sitting on a tax time bomb. Luckily, there's a way to defuse the situation.
