What Will Your Retirement Income Be?

Have you thought about retirement lately? 

My wife and I did and it was eye opening.  We usually talk about retirement, especially at the end of the year, but this was a little different.  We spent time looking at what we have to spend when reaching retirement.

What I am finding is that people look at it in the wrong way.  When asking friends about their plans I was surprised that many are not planning at all, let alone, really looking at what they will have to spend in retirement. 

Since becoming a financial advisor this has become apparent more and more.  Many people my age don’t even think about saving or what the future will hold and how they could control it.

One couple I met look to have about $25,000 a month in retirement.  They have done everything right since entering the workforce in the 70s.  How would you like to have that kind of income in retirement?  I’d like to have it now!  It is attainable. 

In our culture we don’t emphasize retirement enough.  The issue is brought up through a company plan or maybe a conversation with a friend but it is difficult to find people really prepared. 

Kids today especially don’t understand the first thing about saving or being responsible with their money.  It’s about where to buy the next Ipad or new technology even though you can barely pay rent. 

This problem won’t take care of itself.  The biggest mistake I see is looking to the government to take care of retirement.  Social security won’t cover your expenses but a good plan will. 

I personally know people in retirement who have never made more than $50,000 a year and are doing just fine in retirement because they planned correctly.  It can be done.  You wouldn’t know it from watching the news but it is possible.

Think about the numbers for a minute.

You’re 25 and want a million dollars 40 years later when you retire at 65 you need to start saving about $300 a month and have an 8% growth rate over the duration of your saving as your money compounds. 

At 35 it would be about $700 a month to save.  Age 40 about $1,050 a month and so on.  You get the picture.  It’s not easy to save this kind of money and not as many pensions anymore to meet the income requirements to live good in retirement. 

$1 million at age 62 would only give you $37,000 a year in income to live on.  Of course you would have social security (if it’s there) but it’s not as much as you thought to live on.  Especially 20-30 years from now with inflation.

The point is that saving $1 million does not provide the income most people live on now so how can you get this number higher. 

Don’t always think about the amount.  It is important but not the end all for planning.  Think about the types of income you could have. 

To be successful in retirement you need at least 7 – 10 forms of income.  This isn’t as hard as you may think.

Income ideas include rental income, stock dividends, social security, internet affiliate programs, part time job, 401k, IRA, Insurance, a small business, pension and/or consulting.

These are just a few but think where the money will come from in retirement and how you will get there. 

Just some brainstorming ideas for you.

If you want to get more information feel free to contact me through the website.

Values and Money

“Values are the key to living smart and finishing rich.” (David Bach)

This quote caught my attention when I read it.  It sounds simple but in our society it is nothing of the sort.  Money is a key to people’s lives and if they don’t have it tied to their values then you will end up poor. 

Values are wrong everywhere you look.  Take the government for an example.  They still haven’t reopened the government and the debt limit is fast approaching and most likely will be raised giving the government more money to print and borrow.  What kind of values are those.  Our own leaders can’t figure out how to make the government run efficiently. 

What does that say about our society?

I don’t know! 

What I do know is if individuals don’t change their value structure they will end up dependent on government because they won’t have their financial house in order.  Who wants to be dependent on a system that is failing?

Look at people around you.  You can see where someone’s values are by what they spend their money on.  The cars, electronics, clothes and other items show what people value.  It’s not bad to have nice things but what are those going to do if you get to your fifties and have no retirement.

Hence why people go through the midlife crisis.

This concerns my wife and I.  We constantly look at our money situation and try and imagine what we want in retirement.  Then we see where our values are and how that effects our spending.  It affects our spending tremendously.  Especially since we have changed our habits dramatically over the past few years.

That is spending less on material items and more on family and saving.  Although it is difficult to save with the business and adjusting to Colorado we still try and make it a priority.  As we look forward to the future we want it makes our present spending habits different.  It also changes how we prioritize spending.

The sad truth is I don’t see that among many people I meet on a daily basis.  There are so many that have nothing saved.  Many people I know in their fifties and sixties have less than they need for retirement.  Statistics show that half of baby boomers have less than $25,000 in assets.  That is a crazy number and shows that tax payers will be footing the bill for those that aren’t prepared.

What has scared us into changing is seeing what positions others are in and trying to focus on how we can change that for us and help others in the process. Every where you look there is something you could spend your money on.  If your values are in the right place then spending your money wrong will not be an issue and you should end up ok. 

The reality is that our habits put spending first and values second.  Maybe it’s the culture or maybe it’s us as individuals not taking responsibility for our decisions.  As David Bach said in his book Smart Couples Finish First, “too many of us spend our lives pursuing stuff, without really looking at our values.”

What are your values?

A Student’s Experience

I often suspect college students are inundated with information detrimental to their learning.  Finding this myself with professors in ethics, history, philosophy and other classes where an agenda was spewed onto students rather than creating independent thought on a subject.  I was surprised at how many professors had agenda’s and didn’t care what the student had to say about it.  At least if it didn’t fit what they were trying to get accross.

Although I did like and enjoy my college experience some of the insight only pointed me in a different direction than I would have guessed.

Maybe that part of college helped.   

A friend of ours has spoken to me about this very issue.  She is in college at UCCS.  She had mentioned the material and discussions in class were angry towards whites in this country.  It was a women’s studies class she was taking.

Also at a student meeting there was a leader who wouldn’t stop preaching about white privilege and that she has to work “10 times harder” to get ahead in life than our friend who challenged her on the issue. 

She shouldn’t feel guilty!  I saw this as well on my campus.

She spoke up because I had talked with her on this subject and it was the first time hearing someone with my view.  I told her to not let professor’s make her feel guilty about who she is an how she should feel.  Well educated minorities can find a job is not one that is often heard from the media.  Especially not on campuses these days.  My experience is that they are able to do great in this day and age.

Making the education readily available in the early years is difficult.  That to me is the issue.  Families need father’s around and communities need to band together to make this happen. 

That would be a better discussion.  Getting at the core isn’t the goal though for the media or campuses.  They want victims and people to be angry instead of finding solutions. 

But the numbers are good for those who get educated or show effort in the workforce.    

Two friends of mine with an MBA, like myself, and yes, they are of color and doing quite well.  They have been laid off, like myself, only to get a job with a similar company weeks after. 

One recently joked with me about putting black or hispanic on my resume so I would get a call back.  I applied to the very same positions and we have identical resumes but never received any call back.

I’m not complaining and am happy for them.  I could very well blame this on someone else or on some outside force keeping me down. 

With a decent resume you should have no problem getting a job or moving up in this world.  If it’s difficult so what!  Work harder to get on in life and you will succeed.  It’s not easy nor has it ever been easy for me but I believe something will come across my path and it has.  

You have to put yourself out there.  Introduce people who will help each other.  Connect with as many people as you can and something good will happen.  It always has for me.  

The problem I have, and am happy she spoke up, is that people too often use their circumstance as a crux in getting on in life.  Yes people were corrupted, enslaved, and persecuted in this country.  No doubt!

It’s funny she is expected to feel guilty but they didn’t know that she is engaged to a black man.  Oh!  And the team leader stated that Obama wasn’t really black and that doesn’t count as a true black man in office.  


What is going on in her head?  I can’t help but think how good of a career she’ll have with that women’s studies degree.  It won’t be near enough to cover the student loan she’ll have. 

Might be politically incorrect but it’s the truth. 

A student council meeting at University of Colorado Colorado Springs (UCCS) should encourage people to look for answers instead of preaching that white people should feel guilty about what she has to go through as a black women.     

I think that is BULLSHIT!

Stop being angry and work at helping the system instead of criticizing it.  It does no good to cry racism, white privilege, or claim discrimination every time someone has a hard time. We all have issues in this economy and the true elites in this world love that we fight over these issues.

The leader at that meeting mentioned she was discriminated against over a job and in public but couldn’t give an example.  

No doubt this country is not where it should be but more people of all races are educated than in any other time in history.  The problem is there aren’t the jobs for these educated adults.

Half of all college grads are in jobs that don’t even require a college degree.  That is the reality.

MetroState, where I went to college, was the most diverse college in the nation when I attended.  I was proud of that and often had that discussion. 

It’s frustrating our college students are told what to think instead of given historical context to deduce answers for themselves.  No one should feel guilty for their race.  We are all born into a position and no system or person will get them out of it.  Only the individual will. 

My generation and younger don’t have this racist culture our parents and grandparents have so we should stop using it as an excuse for failure in our lives.  


Fathers and Nature

Life is fast and interesting but it passes one by with increased difficulty.  What do I mean by that?  Life is often taken for granted because so much is vying for our time.  The news and movies that occupy our time is bad enough (4-5 hours a day).  Family takes our time.  Work definitely takes most of the day.

Is this detrimental to my children?  Three of them needing our attention and only seeing us for dinner and before they go to bed.  Spending this time is important and that is why this week I made it a point to take them to the park or on a hike.  Sometimes even taking dinner with us so we could be outside and burn some energy. 

I read somewhere recently that children are more empathetic when two things happen: fathers in the home and children playing in nature. 

Father’s in the home surprised me because you wouldn’t think that fathers are more empathetic, which their not, but having them around the home helps children become empathetic.  For me there is no doubt that having a father around is better overall for the child.  Who would argue this. 

Not having a father has been linked to high murder rates, rape crimes, overall criminal activity and sociopathic behavior in individuals. 

I heard Stefan Molyneux talk about the past thirty years and the impact not having the father around has had on the modern child.  If marriage rates would have remained as they were then maybe we wouldn’t have the debt that exists today. 

Think about it!  Having a one parent household creates more dependence on the system and this dependence creates an environment not sound for the child.  Single parents do their best there, no doubt about it, but the impact is also undeniable. 

Schools also don’t have the time to spend on developing the children.  They become undereducated and herded like cattle through the grades.

Kids in single parent households do worse overall.  All stats point to this.

Children playing free in nature is a good one I have seen first hand.  The other day the kids were playing in the house.  Cory and Kylie were getting rambunctious as all hell.  I was making dinner while Lily was crying at the top of her lungs at my feet.  My hands were full of beef so couldn’t pick her up. 

Almost losing it I held my composure and just said screw it.  Let’s go on a hike.  The kids instantly got their shoes on and Lily could sense we were leaving and even grabbed her shoes. 

We spent an hour hiking and running through the hills near the house.  The kids playing in nature instantly changed their attitude.  

After arriving home they didn’t fight but just got ready for bed.  Even Lily sat on my lap, drank her milk, and played for an hour happy as can be.  Kylie and Cory worked on an art project and were nice to each other. 

What a difference a quick run through nature does for the kids. 

We are not the perfect parents but I want nothing more than to spend my day with the kids rather than on other activities.

I am no scientist or expert but a parent that sees what is happening to the country.  I don’t need a study to tell me that kids need fathers around and that our system needs to revisit what is important.  Like parents staying home with the kids instead of keeping up with the Joneses.

Maybe they need to stop “Leaning In” and focusing on what is important.  There has to be sacrifice in order to raise the child right.  That has to be in the home.  Our kids depend on it.

Welcome to the Job Market College Grads

An article in the Wall Street Journal reports on the struggles new college grads have.  They are graduating with student loans and employment that barely helps pay rent.  The recession has left many young adults in a predicament not familiar with their parents.

How is this so?

The college degree doesn’t seem to help much in an economy struggling to grow.  When I graduated from college there was a sense of accomplishment from graduating but struggle as interview after interview turned up nothing.  This was in a great market just after the tech bubble and before the banking crisis of 2008. 

With not much luck in the interviews I went into real estate.  You don’t need a degree to get your real estate license and most people I knew in Florida were making money one way or another in real estate.  It was the right decision for me because it gave me experience with dozens of potential clients a week.  This was experience I needed.


This is a call to college grads to keep your head up and try to make something of yourself.  We have better technology than ever before and there is money to be made.  It might not happen with the degree you thought would get you into the working world. 

For me, real estate helped to get the communication skills needed in life.  Just before the crisis in real estate hit I made the decision to go into pharmaceutical sales.  This opportunity was given to me by an acquaintance at the church and we have become good friends since.  This was a connection given to me because I stuck my neck out there and over heard him talking about his company.  At the time I didn’t know him but gave my resume and said to keep me in mind when something opens up. 

Sometimes that’s all it takes.  What college can’t give you is the aggressive attitude it takes to make things happen.  Throughout the past few years the only good opportunities came from asking for business or asking for the opportunity.  Often times people fail to see when an opportunity presents itself.  College could never teach that and most young college grads I meet may know how to pass a test but have no experience in the workforce to take it to the next level. 

In order to get to that next level they have to develop skills I only received by working.  Education is not only learned in the classroom.  I learned plenty in the classroom but it doesn’t compare to that learned in the real world. 

The Wall Street Journal article explains how the economy isn’t coming through for these young adults.  It’s frustrating for parents and their kids.  Especially when they come come home to live. 

Where are the experienced business people and acquaintances with advice on how to succeed?  These are the people who college grads should reach out to. 

It is nice to have a mentor and most successful people would be willing to give advice on how they made it and most, at least that I’ve met, didn’t get that education from college.  College, for most, is a time to party, have sex, and see the best Phish shows.

College is a good experience, and hopefully education, but the new up and coming flock are inundated with debt they aren’t aware will have a negative affect on their lives.  A study pointed out in the article shows that $53,000 in student debt will reduce lifetime wealth by $200,000.  That is 2-3 years in retirement wiped away.  That was my debt and thank God most of it is paid off.   

At issue is the amount of tax money covering the debt incurred by our “lost generation.”  $1.2 trillion in debt already exists to past students.  This could cost tax payers $1.6 trillion in lost tax receipts if they don’t find positions and $4.7 trillion if you account for broader economic effects of graduates not working.

Scary if you think about it. 

Not to mention a large number of graduates “don’t earn, they don’t pay taxes, they stay at home, they don’t get married.” 

A large number of graduates will lose confidence because they were never taught how to “choose themselves” and succeed in this environment.  We all live in this country and struggle to succeed but is our misrepresentation of the “American Dream” hurting our children?


“I Got Schooled” – A Book By M. Night Shyamalan

M. Night Shayamalan was on Huffington Post yesterday.  At first I thought it was on a movie he made so I watched to hear about it and was surprised he had a new book called “I Got Schooled.”  It was about his last 5 years of research on the public school system.

I am writing a book about student loans and college so I thought it would be interesting to see what he had to say.  I haven’t read it yet but because of the interview I will buy the book.

He is an outsider who knew nothing about what is wrong with public schools.  He had biases before, mentioned in the interview, and found those biases to be wrong from his research.  His passion for the schools in Philadelphia are what got him started on this quest.  

His early biases were similar to what you hear most people say about schools such as too few resources and classrooms that aren’t small enough for students to learn.

Being on the Huffington Post made the interview humorous to me.  Instantly you get a sense that the interviewer, Ricky Camilleri, had an agenda.  He wanted M. Night to justify that charter schools were “a total failure” and also made comments about capitalist and lobbyist agendas.  Ricky doesn’t get the answers he was looking for although he wasn’t aggressive about it.  He did engage in conversation. 

M. Night said that the charter schools aren’t better or worse themselves but the environment they create was efficient and seems to be working.  My own findings show charter schools, in some circumstances, aren’t always better academically but do provide a safe and structured place for inner city youth to attend school.  The average poor inner city child does better in these environments than in the previous public school they attended.

As shown in The Cartel this seems to be the case.   

My first thought was “typical Huffington Post” when they displayed the 5 things he found schools need to change for fixing the system.  What the Huff Post showed was that he wanted to let go ineffective teachers although that was misrepresented.  He reacted right away and said what they showed is “acrimonious” and not how it reads in the book. 

Then a caller from Chicago called in.  He was a teacher in inner city Chicago and had strong opinions about what M. Night was saying.  The caller disagreed vehemently and said that they have no resources and the government cutting the budget hurt more than anything.  The findings in the book were opposite and this was clearly stated but in a professional and unbiased manner.

The book shows the findings only and he feels the experts should take the information and do something with it.  He doesn’t want to fix the problem himself like superman but instead spent five years finding research to get real answers.  Maybe someone will take the research and run with it but I doubt it.

I’m finding a lot of the same thing with research I’m doing.  Even in college people want answers but won’t get any from those who are trying to protect their institution and don’t really want change. 

Who loses out?  The students!

The same thing is happening in public schools.  My kids go to one as well but I can tell that it’s a touchy subject.   

Whenever there is research or a finding that doesn’t fit the agenda of the Department of Education, unions, or teachers in general you get kick back and nothing gets done.  Your instantly labelled as a union buster or you hate kids.  Great arguments from the very people who are supposed to be educating our kids. This makes it difficult to find research and answers from people in the system. 

A tweet said “having N. Night Shyamalan join the cause is probably the worst thing for ed reformers.”  This shows that people are threatened and don’t want answers.  They criticize but don’t offer real solutions.  This isn’t reform! 

How about efficient use of the resources.  M. Night mentioned that not more resources but efficient use of resources was one of the findings in the book.  The best schools use resources more efficiently and that is what charter schools and the best reformed public schools are doing.  So the amount of resources one school gets doesn’t matter?  I have found that as well.

People need to lighten up and take the criticism.  Whether you are for the unions, as Huff Post clearly is, or just want some type of reform there has to be an outside source to solve these problems because the people in the system don’t seem to want real answers. 

Look what happened to Michele Rea in D.C. 

M. Night handled himself well considering other interviews and reviews I see misrepresent what the book actually found.  It is hard for anyone to have a good debate when people misrepresent what an author’s findings are.  This country is so full of representatives with agenda’s it would be a miracle to fix anything as important as our kid’s schools.

Most people think issues like smaller classes, money, and vouchers work but he states very clearly that these will not change the system based on his research. 

There are five main agenda’s he feeld, done together, would help reform education and they are: what is a good teacher worth, pivot the principal’s job from operations to improving teaching and school culture, give teachers and principals feedback, build smaller schools, and keep children in class for more hours.

These findings seem reasonable but with our bureaucratic system it’s almost impossible.

The most important thing I got out of the interview, and hopefully the book, is the passion M. Night feels for this topic.  It would be nice for people to listen without letting emotion take over the debate.  It is impossible to change someone’s opinion when they won’t listen.

The same rings true with studies on the problems college has.  The real answers are strongly shot down by the very people who are fighting to keep the status quo.

Although I do understand why a teacher or union leader would get defensive from decisions that affect their livelihood, we need a real debate and so far I have yet to see one.

Young Minds

This morning I was eating breakfast at a Village Inn while my car was getting an oil change.   My iPad was on to the news of this Monday morning.  A lot was on my mind and I was reading the market news for the week.  While reading a young man of about 20 approached me. He worked at the restaurant, saw that I was looking at stocks, and asked if I was a stock broker and where I went to college.

Just like that!  “Are you a stock broker and where did you go to college?”

It was a weird moment because I could tell that he was interested in talking with me but didn’t know how to go about it.  He was a student at University of Colorado Colorado Springs (UCCS) and was wondering if he should change schools because he felt it might matter what school you go to when it comes to getting a job. 

I told him that the school didn’t matter unless he was going to Harvard or another Ivy League school but even then they haven’t proved their any brighter so it depends on the person. 


He then asked what I did for a living if I wasn’t a stock broker.  I told him and he asked if you had to have a degree to get that position.  I give the kid credit.  He wanted answers and didn’t seem confident that he was making the right decision.

I too have had these same questions and often still do. 

“There is nothing wrong with staying at UCCS because when you get that degree it’s not going to matter” I told him.  I believe that is the case but what does matter, and I told him, is that you have to get the right connections and work hard to prove to others that you are worthy of them paying you a wage able to support you. 

What I then went on to say is that college isn’t as important these days because when you graduate the job market for college grads may be worse than even today because, even though college is important, he has to hone his skills hard if he wants to be successful. 

He needs to save half of the money he makes now and learn as much about finance and business as he can.  He was already a business major.  I told him to not take his professor’s word on everything and read as much as you can on any business topic that interests him. 

He looked at me as if I was talking about aliens but said that it was different advice than he had heard in the past and he thanked me. 

Maybe this made an impact but it is what I would have said to myself if I were twenty again.

Love helping young minds.

Our Future

Today was not the best of days.  I took my dog of 15 years to the vet to be put down.  It’s not fun to see your kids and wife crying at the door as you take your pooch to her last trip to the vet.  The 2 Hampsters we bought the kids didn’t make them feel any better.

Boy that is a tough way to star the day but I sit here trying to take my mind off this by thinking of where I want to be financially.  Writing takes the mind off of these things. 

Where do I want to be?

We have been planning for retirement and setting goals or at least visualizing where we want to be.  It helps to talk details about what we will do and how we will live in retirement.  Our goals are pretty clear that when Lily, our youngest, is out of high school and off to college we want enough income streams to travel and use our time for our own bucket list.    

That is 18 years from now but still when you look at it in financial terms it’s not too far off.  What is important for us is to make sure that our children understand values and finances more than anything else they learn from us.

Kids are not taught finance in any level of school.  I know!  The music program and history department is so important but what good is playing a guitar high at twenty going to do for your finances?



I get this because of my history with finances.  I have always made decent money and been good at saving for something important like a trip to Africa or a summer of touring with my favorite bands.  None of my planning was spent trying to save for a future where I could be financially free.

This I regret but understand that I can change that and have worked hard over the past few years to understand how to accomplish this. 

“But I believe – no, I am certain – that anyone who has modest intelligence and a positive attitude can become financially independent in seven years or less if he or she is willing to work enormously hard”  Mark Ford

This quote is pinned above my desk and I look at it daily.  Why don’t more people think this way? 

Maybe because talking of money and being brutally honest with people is politically incorrect these days. 

Kids are worse off than their parents today for the first time since the Great Depression.  

Our values and focus is on the wrong things.  I don’t want my kids to be worse off than me and I work hard to show them otherwise or not have their mind go there.  Seeing how kids think these days doesn’t give me much hope.  It’s hard to say but that is how I feel and I understand that every parent throughout time has said this.

How do we change this?

By parenting and taking control of your own life.  My wife and I want to set an example for our kids and if we do this they should be ok.  There are always exceptions but the problem, as I see it, is that parents are not setting good examples.  I could give a dozen personal examples but I don’t want to offend anyone and no, we definately aren’t perfect.

Do you think the kids in this video have good role models. 


Retirement is important for us but education is important for our kids.  It’s not always college or public school either because I know plenty of college grads who can’t handle their money and make horrible decisions.  Most companies retrain college educated kids and “unlearn” them from their expensive college education.   

Over half of Americans have less than $10,000 in savings and 28% of families have no savings at all.  This is a scary figure and one where thirty years ago was opposite.  In 1980 families debt level in the U.S. was 57% of their income.  Today it’s 107%.  Down 14% but still unaceptable.

How will kids save if their parents aren’t?

Yes, people are struggling like never before.  We are too but many are relying on others to figure this out for them. 

Let me tell you something you may not want to hear.

No one cares about what you’re doing so figure out how to get out of your situation.  Don’t depend on others to get you out.  Especially the politicians that have no clue and the more they do seems to hurt, not help, the communities they represent. 

One thing that stuck with me a few years back was a question I asked a wealthy friend.  I asked what advice they could give me about gaining wealth.  He said that if you want to be wealthy you have to admit that the position you’re in is your fault, or your doing, and there is no one else to blame.  When you can accept that you are on the right path.

The quote above by Mark Ford captures that thinking.  I hate that we are not making the money we once were but that hasn’t stopped us from looking for better options at all times and working on the 12 income streams we want when retiring. 

Hopefully my kids will see this effort and it helps them to make better decisions.

The more mainstream news I watch the more I realize that the message always is you’re the victim and blame others for the situations you’re in.  Well suck it up because you’re in your situation because you put yourself there and need to learn from the mistakes and figure a way to get out.

Sorry I need to hear that and so do you. 

Good day to you.

Unemployment Discussion by Abbott and Costello

Who’s on the Job?

COSTELLO: I want to talk about the unemployment rate in America. 
ABBOTT: Good Subject. Terrible Times. It’s 7.8%.
COSTELLO: That many people are out of work?
ABBOTT: No, that’s 14.7%.
COSTELLO: You just said 7.8%.
ABBOTT: 7.8% unemployed.
COSTELLO: Right; 7.8% out of work.
ABBOTT: No, that’s 14.7%.
COSTELLO: Okay, so it’s 14.7% unemployed.
ABBOTT: No, that’s 7.8%.
COSTELLO: Wait a minute. Is it 7.8% or 14.7%?
ABBOTT: 7.8% are unemployed. 14.7% are out of work.
COSTELLO: If you are out of work, you are unemployed.
ABBOTT: No, Congress said you can’t count the “Out of Work” as unemployed. You have to look for work to be unemployed.
COSTELLO: But they are out of work!!!  
ABBOTT: No, you miss his point.
COSTELLO: What point?
ABBOTT: Someone who doesn’t look for work can’t be counted with those who look for work. It wouldn’t be fair.
COSTELLO: To whom?
ABBOTT: The unemployed.
COSTELLO: But all of them are out of work.
ABBOTT: No, the unemployed are actively looking for work. Those who are out of work gave up looking, and if you give up, you are no longer in the ranks of the unemployed.
COSTELLO: So if you’re off the unemployment rolls, that would count as less unemployment?
ABBOTT: Unemployment would go down. Absolutely!
COSTELLO: The unemployment just goes down because you don’t look for work?
ABBOTT: Absolutely it goes down. That’s how it gets to 7.8%. Otherwise it would be 14.7%.
COSTELLO: Wait, I got a question for you. That means there are two ways to bring down the unemployment number?
ABBOTT: Two ways is correct.
COSTELLO: Unemployment can go down if someone gets a job?
ABBOTT: Correct.
COSTELLO: And unemployment can also go down if you stop looking for a job?
ABBOTT: Bingo.
COSTELLO: So there are two ways to bring unemployment  down, and the easier of the two is to have people stop looking for work.
ABBOTT: Now you’re thinking like an economist.
COSTELLO: I don’t even know what the hell I just said!
ABBOTT: Now you’re thinking like Congress.

Curtesey of Casey Research

Student Loans: What To Do


The student loans us grads have racked up has now hit the $1 Trillion mark and is the only form of consumer debt that has grown since 2008.  That is an insane amount of debt and now the government owns most of it.  Or I should say the taxpayers own most of it.

I once felt like this

I once felt like this

So what are people doing with this debt?

I looked up a few statistics and ran accross some good experts on the subject and below are three popular ways people are handling the debt.  Because student loans cannot be settled in bankruptcy these options are good for those who are interested in a solution.

I personally consolidated my debt but paid it shortly after the consolidation.   


To consolidate your student loans into one loan with a single payment then Consolidate College is a good option and probably the best.  They have helped many students consolidate their loans and it is a great reference for anyone, and I recommend everyone do this, who needs or wants to consolidate. 

With 37 million student loan borrowers holding outstanding balances, a huge percentage of these have more than one loan attached to it.  This gives many people and opportunity to consolidate what they have into one payment. 

When I graduated from college and saw the six different loans and a total bill of more than $400 a month the reality set in.  It was going to be difficult for a family that had just moved to Florida and a child on the way to make these payments.  Oh ya!  And we just bought a house.  Not to mention that my real estate business was just getting off the ground and wasn’t bringing in consistent money. 

If you go to the Consolidate College website an operator can help you consolidate the loans and could cut the payment significantly and over time minimize the amount of interest. 

One example I saw was someone paying $249 a month and after the consolidation the payment was $99.  This works and your credit won’t be affected because you are still paying the loans down.  If you are worried about your credit this is your best option. 

I believe my payment was reduced from $400 to $220.

Income Based Repayment Programs (IBR)

The Income Based Repayment Program has been around since 2009.  This program helps borrowers keep their loan payments affordable by capping payments based on your income and family size. 

They use a sliding scale to determine what you can afford to pay. Below is an example of some of thepayment caps:

Payment Caps from ibrinfo.org

Payment Caps from ibrinfo.org

In some cases your payment may be low enough to grow your debt.  NO WORRIES!  The governemnt will forgive your remaining debt after 25 years of qualifying payments.

And if your payment doesn’t cover the interest then the government will pay your interest for the first three years.

Another program related to the IBR is the Public Service Loan Forgiveness (PSLF). This is a great way to have thousands of dollars forgiven without hurting your credit. 

The program is for people with federal student loans who work in a wide range of “public service” jobs, including jobs in government and nonprofit 501©(3) organizations.

Eligible jobs include:

  • Nonprofit, tax-exempt 501(c)(3) organizations
  • Employed by federal government, state government, local, or tribal government including military and public schools
  • Full-time AmeriCorps or Peace Corps positions

Those who do not meet this criteria the Department of Education has created a two part test to qualify people.  This may confuse you more but if you are interested it is worth the research. 

It confuses the hell out of me.  It’s the government!!  But it’s there and is a good option.

Imagine if your bank forgave any debt leftover after ten years of good payment history.  It sounds too good to be true but this was implemented July 1st 2013 and doesn’t have a limit on how much will be forgiven.  

All loans and payments started after October 1, 2007 qualify. 

You could have a $120,000 loan and still get it forgiven after the ten yeras. 

Wow!  Taxpayers are very generous!  I guess that makes me generous.

Yet, another program in this category is the Pay as You Earn plan.  This plan helps keep your monthly student loan payments affordable by using your income as a gauge. 

You do need to have a partial financial hardship for this to work but those of you with larger families should try and get this because it will help early when you bring in less income and payments get adjusted as income increases. 

Pay as You Earn has a twenty year forgiveness plan that works very similar to the ten year plan mentioned earlier.  You have to meet these requirements as well but it is a good incentive to keep up to date on those payments. 

Settle (Yes Settle!!!)

Many people settle credit card debt but settling student loans is also an option that most aren’t aware of.  I didn’t realize this was an option either.  Your are unable to claim bankruptcy and but settling is an option.  In some cases you could get 15 to 30 cents on the dollar.  You can’t beat that but there are consequences.  


Settling the debt will hurt your credit no doubt about it.  Debt forgiveness will be reported as bad debt on your credit report and you may owe income tax on the forgiven debt. 

This shouldn’t bother some as a lot of people are settling their debts these days and, even though it hurts your credit, if you stay clean on payments for a couple of years you should be ok to buy a house or car.  You could probably buy a car soon after. 

I’ve written before that owning a home is overrated anyways.


You have to come up with money to do this though.  Sometimes as high as 30 percent but it will be worth it if the balance is taken off the books. 

And don’t forget the tax implications.

This plan has helped many people but don’t think it’s as easy as calling and giving them an offer.  It could take months of back and forth so it is better to work with someone directly who can fight for you.  I have heard of this option being used more and more as of late and now feel it’ll soon become one of the more popular options.

Good Luck

These are just a few options for people today.  The next question I think parents need to have with their children is if college is worth taking on this debt.  That is another discussion and one that seems to come up quite frequently today. 

Either way the numbers speak for themselves.  It looks like the taxpayers are going to eat a lot of this debt. 

Good day to you.