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The Value of Debt in Retirement: Why Everything You Have Been Told Is Wrong
Increase the odds you won't run out of money in retirement using debt!
Conventional wisdom is wrong and being debt free in retirement may actually increase your risk. The Value of Debt in Retirement teaches you how incorporating debt into your retirement strategy may increase your return, lower your taxes and actually lower your risk. You read that right. If handled correctly, debt that thing we've all been taught to avoid can play an integral role in your life,especially in retirement. New York Times Best Selling Author and nationally acclaimed financial expert Tom Anderson shows you how to use the time tested strategies of the best companies and the ultra rich to retire comfortably, minimize taxes, buy the things you have always wanted to have and do the things you have always wanted to do.
Thought provoking and against the grain, Anderson explains why your risk tolerance doesn't matter, why being debt free may actually increase your risk and why rushing to pay off your mortgage may be a financial disaster. Full of shocking revelations and tricks high- net-worth individuals have used for years, The Value of Debt in Retirement opens the world to a new approach to wealth management in retirement, one that factors in both sides of the balance sheet as an integrated ecosystem.
Real-world case studies illustrate how informed debt strategies can lead to a happier, healthier retirement. See how an individual with a net worth of more than $5 million can spend $20,000 per month - after taxes - and pay less than $5,000 per year in taxes,how it is possible to increase your rate of return by 50%, and how a lower risk portfolio with debt could increase the chances you do not run out of money.
Specifically written to Baby Boomers, practical guides and checklists show how to use debt strategies to fund primary and secondary properties, refinance credit card debt, and finance hobbies, such as cars and boats and recreational vehicles. Additional guides show how you can help your children, help your parents and leave a bigger legacy for your heirs and favorite charities. Regardless of your net worth, The Value of Debt in Retirement provides tools to use to apply these concepts to your personal situation.
There is no free the book delivers a balanced perspective focusing on the potential risks and benefits of the strategies discussed. A discussion on economic history highlights some of the shocks the economy may face and provides important warnings that you should factor into your retirement plan. Anderson not only shows that your life expectancy may be longer than you think, but also illustrates that many investors may be on track to average returns well under 4% for the next ten years a potentially devastating combination. Irrespective of your beliefs about debt, The Value of Debt in Retirement proves risk is more important than return for retirees and provides suggestions on ways to minimize that risk.
Not all debt is good and high levels of debt are bad. TheValue of Debt in Retirement is about choosing the right debt,in the right amounts, at the right time. Perhaps most importantly,this book isn't for everybody. This book requires responsible actions. If you can't handle the responsibility associated with the ideas then this book then it isn't for you. If you need a rate of return under 3% from your investments then you may not need this book. But if you can handle the responsibility and if you need a return above 3%, this book may offer insights into the best (and potentially only) way to achieve your goals.
Conventional wisdom is wrong and being debt free in retirement may actually increase your risk. The Value of Debt in Retirement teaches you how incorporating debt into your retirement strategy may increase your return, lower your taxes and actually lower your risk. You read that right. If handled correctly, debt that thing we've all been taught to avoid can play an integral role in your life,especially in retirement. New York Times Best Selling Author and nationally acclaimed financial expert Tom Anderson shows you how to use the time tested strategies of the best companies and the ultra rich to retire comfortably, minimize taxes, buy the things you have always wanted to have and do the things you have always wanted to do.
Thought provoking and against the grain, Anderson explains why your risk tolerance doesn't matter, why being debt free may actually increase your risk and why rushing to pay off your mortgage may be a financial disaster. Full of shocking revelations and tricks high- net-worth individuals have used for years, The Value of Debt in Retirement opens the world to a new approach to wealth management in retirement, one that factors in both sides of the balance sheet as an integrated ecosystem.
Real-world case studies illustrate how informed debt strategies can lead to a happier, healthier retirement. See how an individual with a net worth of more than $5 million can spend $20,000 per month - after taxes - and pay less than $5,000 per year in taxes,how it is possible to increase your rate of return by 50%, and how a lower risk portfolio with debt could increase the chances you do not run out of money.
Specifically written to Baby Boomers, practical guides and checklists show how to use debt strategies to fund primary and secondary properties, refinance credit card debt, and finance hobbies, such as cars and boats and recreational vehicles. Additional guides show how you can help your children, help your parents and leave a bigger legacy for your heirs and favorite charities. Regardless of your net worth, The Value of Debt in Retirement provides tools to use to apply these concepts to your personal situation.
There is no free the book delivers a balanced perspective focusing on the potential risks and benefits of the strategies discussed. A discussion on economic history highlights some of the shocks the economy may face and provides important warnings that you should factor into your retirement plan. Anderson not only shows that your life expectancy may be longer than you think, but also illustrates that many investors may be on track to average returns well under 4% for the next ten years a potentially devastating combination. Irrespective of your beliefs about debt, The Value of Debt in Retirement proves risk is more important than return for retirees and provides suggestions on ways to minimize that risk.
Not all debt is good and high levels of debt are bad. TheValue of Debt in Retirement is about choosing the right debt,in the right amounts, at the right time. Perhaps most importantly,this book isn't for everybody. This book requires responsible actions. If you can't handle the responsibility associated with the ideas then this book then it isn't for you. If you need a rate of return under 3% from your investments then you may not need this book. But if you can handle the responsibility and if you need a return above 3%, this book may offer insights into the best (and potentially only) way to achieve your goals.
336 pages, Hardcover
First published February 24, 2015
21 people are currently reading
62 people want to read
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Displaying 1 - 8 of 8 reviews
August 16, 2016
So I have some investment cash heading my way (thanks, Dell), and one of my roboadvisors told me I needed more bonds. I’m thinking I’d rather kill off the mortgage. And then I notice this book. Since I’m in my 50s and wondering if retirement still exists, this was an interesting read hitting a lot of questions I currently have. The author makes the case that some amount of “good” debt can lower risk in a portfolio while providing liquidity. This is what companies do (and pay for the privilege), and according to the author, this is what people should do as well. The author wisely provides a number of limitations on his advice, particularly related to comfort with debt and portfolio size, so there are probably not a lot of people that qualify. The author also discusses what to do with your borrowed money, such as buying a second house, and provides some guidelines for when renting would be better. The author provides basic mathematical proof throughout the book, with more detail in the appendices. I found these mostly easy to follow. It does seem like a lot is riding on finding investments making more than your interest payments for this to really be a winning formula, but it appears to be in the realm of the possible.
So the test of a business book, especially a personal finance one, is whether you’ve changed your thinking and/or your investments. I will admit that this has changed my thinking. I was undervaluing liquidity, but not anymore. And I now know about another tool for borrowing that may make sense later on. I recommend this quick and insightful read if you have questions about the value of debt in and near retirement.
So the test of a business book, especially a personal finance one, is whether you’ve changed your thinking and/or your investments. I will admit that this has changed my thinking. I was undervaluing liquidity, but not anymore. And I now know about another tool for borrowing that may make sense later on. I recommend this quick and insightful read if you have questions about the value of debt in and near retirement.
February 19, 2020
I appreciate learning this perspective on the use of debt in retirement - honestly, I don’t think some facets I learned in the book would have occurred to me in any fashion.
If I were going to critique an aspect of the book, it is that it feels like sections are rehashing the same idea multiple times, and those tactics rely on someone having a big bucket of taxable investments in a non-retirement account to be used to generate debt. I had to flip past more than a few sections thinking, “Ok, already, I’ve got this.” Might even drive my rating down to 3.5*.
Now, I understand that was a main topic of the book, but I think that possibility limits its usefulness to many people. But, I suppose that is the case for many such books, they can’t cover everyone.
But, I did like the author's multiple examples, which were clear and illuminating. Overall, very much worth a read even if just to get the basic idea at the start, then go through the later scenarios.
If I were going to critique an aspect of the book, it is that it feels like sections are rehashing the same idea multiple times, and those tactics rely on someone having a big bucket of taxable investments in a non-retirement account to be used to generate debt. I had to flip past more than a few sections thinking, “Ok, already, I’ve got this.” Might even drive my rating down to 3.5*.
Now, I understand that was a main topic of the book, but I think that possibility limits its usefulness to many people. But, I suppose that is the case for many such books, they can’t cover everyone.
But, I did like the author's multiple examples, which were clear and illuminating. Overall, very much worth a read even if just to get the basic idea at the start, then go through the later scenarios.
October 25, 2021
The author gives a comprehensive philosophy on debt and days that strategic use of debt in the range of 15-35% of assets can reduce taxes, and increase flexibility/liquidity.
He specifically advocates for using a margin account as a vehicle for doing this. Seems to make sense, but I think he slightly downplays the risks. A great, thought provoking read!
He specifically advocates for using a margin account as a vehicle for doing this. Seems to make sense, but I think he slightly downplays the risks. A great, thought provoking read!
April 27, 2021
Makes you think differently about debt. Very good explanation of good debt vs bad debt and why you need to leverage your assets to stay ahead of the game.
Even if you don't accept all of his ideas, it is worth one's time to read and think through this.
Even if you don't accept all of his ideas, it is worth one's time to read and think through this.
December 25, 2021
Interesting and likely useful, particularly in its study of safe withdrawal rates with/without debt. Structured well with appendices allowing readers to “opt-in” to a greater level of detail
January 31, 2016
This book came well recommended from one of my rock star retiree friends! I've saved $ all my life and been fiscally responsible, anticipating an enjoyable life in retirement. Yearly checkups with my financial advisor have indicated I'm on the right path. My entire career has been one of 'Trust but Verify'. I need to verify the assumptions I have been given.
Since I don't like following financials or deal with financial lingo and formulas, I have always made myself "too busy" to dig into the details. I still do not want intimate involvement, but I need to be more of an active participant in determining the wisest use of my $.
This book was very well done and met my needs! It was written to an educated audience capable of learning from the stories and concepts presented. For those real financial guru's the guts of the formula's and more extensive data-diving can be found in Appendices.
I wanted to increase my confidence in asking the right questions and in assessing the answers I receive. Got it! Ready for my next financial meeting! I rated the book 4 stars for its format, presentation of material and meeting my expectations. That 5th star could not be given since I did not like the subject, still do not like the subject and did not enjoy reading this type of book. That's just being honest!
Since I don't like following financials or deal with financial lingo and formulas, I have always made myself "too busy" to dig into the details. I still do not want intimate involvement, but I need to be more of an active participant in determining the wisest use of my $.
This book was very well done and met my needs! It was written to an educated audience capable of learning from the stories and concepts presented. For those real financial guru's the guts of the formula's and more extensive data-diving can be found in Appendices.
I wanted to increase my confidence in asking the right questions and in assessing the answers I receive. Got it! Ready for my next financial meeting! I rated the book 4 stars for its format, presentation of material and meeting my expectations. That 5th star could not be given since I did not like the subject, still do not like the subject and did not enjoy reading this type of book. That's just being honest!
May 11, 2015
This book challenges the "retire with no debt" camp, arguing that there are 3 categories of debt- Oppressive Debt, Working Debt, and Enriching Debt. His premise seems plausible to me, but it also seems you could get into a lot of trouble without a qualified financial planner who understands the philosophy, and who can help you execute. He's given me a lot to think about, and that's a good thing.
May 30, 2016
Interesting ideas for using debt strategically. Quick read. I'm nowhere near retirement, but this gives me some good ideas to think about now.
Displaying 1 - 8 of 8 reviews