Jay Zigmont 0:00

I think I learned more by easy come, easy go somewhat and then going, oh, you know what I need to learn about what a budget is and how to, what debt is and how does this work? You know, I bought a house for cash. That was cool. Might not have been the right choice. I don't know. You know, like, and these are the things you start realizing. And the thing that became very obvious to me is we do a terrible job in the US Teaching people how to manage money.

Seth Harrison 0:35

You are tuned in to the Money Script podcast. Today we will share strategies to help you grow your financial literacy and improve your Money Script. I'll be back with some important announcements. Until then, enjoy the show.

Yohance Harrison 0:56

Welcome to the Money Script podcast. It's your host, Johannes Harrison. So happy to be with each and every one of you today. Welcome back to another episode. I mean, we are just rolling right along here. I am, I'm, I want to say thank you. I want to say thank you to Brianna, Brianna Perkins. She is one of the team members here at Money Script wealth, and she has been in charge of just lining up my schedule with amazing individuals to interview. So thank you, Brianna. So if you want to know why these episodes just keep coming out back to back to back, it's because of Rihanna. When I logged in this morning, I saw some of the upcoming episodes. Oh, we got some treats coming for you. We're going to have a few folks come back and see us that we haven't seen in a little while. So that's really exciting to get an update on what's going on with them. And then we have some new folks that you just haven't heard from at all. And I'm really excited to chat with some of them. I'm also excited to talk to Dr. J today. Dr. J, how are you?

Jay Zigmont 1:55

Good. How about you? I tell you, Brianna, like, sent me A4 emails, made sure I was here, checked off the boxes. So whatever you got going on, you got it going on, right?

Yohance Harrison 2:02

She is. I, I, I get the same emails. I should check the same boxes. I'm a guest on my own podcast. I just, Oh, I have a podcast. Okay. That's what I'm doing. Podcast. All right, let's do it. So, Bri, keep it up. Thank you so much. And shout out to Alex, her amazing husband and engineer that brings us all the sounds, the new music for those that have been around for a little while. You notice there was new music. I try to do that every season. That was produced by our friend Alex, his. What is his stage name? He has a stage name. I'll tell it to you later. He's Alex to me but he's dj. Oh I can't remember. Massacre Music something ill Massacre. It'll come to me later. Anyways, appreciate you Alex. So before we dive in and learn about Dr. J and by the way, this is a between two advisors episode. So as you can see from those of you that are watching on YouTube, you see the initials behind his name. He is also in the industry so we're going to have an advisor conversation. So this is I feel this is great especially for not just the other advisors that listen to this podcast, but this is also good for clients to hear the water cooler talk that two advisors have now of course been not going to talk about you specifically. We will protect the names of the innocent and guilty, but we are going to talk about concepts that are important that to us so that we are educating our clients better on how to make better financial decisions. So we have been kicking off this season with giving some financial literacy on a topic. We talked about life insurance, we talked about disability insurance. There's one more insurance that I want to add to your list of just to get educated on and understand how it works for you and that is Long term care insurance. Good old ltc. And if you're under a certain age, you've probably never heard of this type of insurance before unless you've had to deal with it with your parents or grandparents. So high level what is long Term care insurance? It is a type of policy that can provide money to assist you in taking care of yourself when you've lost Activities of Daily Living now there's several activities of daily living. We won't get into all of them today, but just to name a few, it's ambulating, so walking, being able to move, walk, feeding yourself, clothing yourself, bathing yourself, and there's a few others on the list as well. So if you've lost a few activities of daily living, then you may need someone to help you do those things. And if you don't have a spouse that is in adequate health that can help you with that, or if you don't have a live in child that can help you with that. Or maybe you have those individuals and they just can't or don't want to. This insurance can help pay someone to come help you with those dates, those activities of daily living. They can also provide you money to help assist you if you needed to go to an assisted living facility or into a nursing home. So it can, it can be a Very diverse product of how it can help you when you need it the most. And there's a lot of statistics out there about long term care and who's going to need it. I won't get into all of those numbers because I don't have them right in front of me and I don't want to get fact checked by you later. But what I can share with you is that I'll share a little story about the insurance industry and they'll help you understand how big of an issue this is, especially here in the United States. When I started in the industry 20 some odd years ago, there were about a dozen different companies offering long term care and at a great price. Half of those companies are out of the business. Okay. They had to get out of the business because number one, they priced it too low. And the amount of people that kept the policy and was expecting it to be there for when they needed it was too high. Okay? Meaning the long term care industry applied what they call a lapse ratio. So I'm giving you some vocabulary here. A lapse ratio. So that's the amount of contracts that they thought they'd never have to pay out on. So either the person would pass away before needing it or, or they would cancel it, not pay their premiums, that sort of thing. And they're like, ah, we'll never have to pay out anything on those individuals. We just got to keep their. Okay, well the problem is, is that lapse ratio was very low because people wanted to keep their policy in place cause they understood the risk because they went through it with their parent or their uncle or their aunt or their grandparent or spouse. And they said, no, I need to keep this policy in place. And companies went out of the long term care business. They either stopped offering new policies, they started raising the rates on existing policies. I have clients now, their rate's gone up 4x from where they started. Okay. And they basically got a letter in the mail. It's like, hey, we're increasing the premiums. If you want this, here's what you have to do. And we had to look at and say, well, I guess we're paying this kind of didn't have a choice. So what I encourage you to do with this information, especially if you are, I'd say 40 and up. This is something you need to start thinking about. Is it something that should be a part of your insurance portfolio? Also if you have parents that are 40 and up, you as the child of that parent, you may want to think about it. I Live in a household where my mother in law is downstairs. And she has lost at least one of her activities of daily living. She's in a wheelchair. Okay. Now fortunately she still has upper body strength. She can get on and off the toilet by herself. She can dress herself, she can bathe herself. She didn't. Well, she can bathe herself because we redesigned the bathroom to make it accessible to her. Same thing with the, the toilet. We redesigned everything to make it more accessible. So. But if she didn't have that accessibility, she would need that help. We actually, the house we were in was, wasn't accessible, so we had to move into a house that we can make more accessible. Once we realized that she might be in a, in a wheelchair for a long time, she is, she's starting to work on walking. The, the, the

Yohance Harrison 8:13

personal. Excuse me, what do you call it? Pt. Physical therapist. Physical therapist is here two, three times a week. She's, we got a walker with the tennis balls on it. So she's, she's starting to get a little mobile, which is exciting. But we've been three, four years now with her being confined to a wheelchair, so. So this is real, I'm experiencing in real life. And it's too late for her to get long term care. Okay, so let me take some numbers.

Jay Zigmont 8:37

Let me bail you out because I've actually got these numbers, so.

Yohance Harrison 8:40

Oh, share with me. Oh, you got the number. Oh, this is what I said. This is the water cooler talk.

Jay Zigmont 8:45

So my clients, because they're child free, they don't have kids, you know, they always have to talk about this. We try to figure out a plan for our clients at 45, you know, kind of somewhere paid a pocket or insurance. Here's the numbers. Last year, on average $115,000 is what it costs for a year in a skilled nursing facility. And on average women will spend 3.7 years in care. Men 2.2. So we're talking about huge numbers and increases by 5% each year. That's what the cost increases. And there's a study, the census looked at adults over 55 and looked at what percentage get support from their family financially. And first they look at childless folks. And that's the people I serve. They found 2.5% got any financial support from their family. So that's like nothing. They look at the same, the same in adults over 55. Parents 1.5% got any support from their family. So if you think your kids are paying your long term care bills, the answer is no.

Yohance Harrison 9:43

Well, I gotta pay for College, let's see, I'm a sandwich generation. I had a kid and well, so I had a kid in kindergarten, a kid in college and a parent at home. Okay. So I'm paying college, saving for college and taking care of my mother in law.

Jay Zigmont 10:00

So we're the open face Sandwich is what they call. You know, I'm caring for my mother, but I don't have any kids, you know, but it's the same thing. I've been. Karen, my, my mother's been disabled since I was about 16. So I mean, I've been living that same boat, sir. In all different ways. And what's interesting, my clients, since they don't have kids, they get the, well, you don't have kids so you can take care of mom. And it's like, well, we all have, you know, like there's these expectations that come with it and we often get the question, well, who's going to take care of you when you're older? Well, our answer is your financial plan, your long term care insurance, your, your money.

Yohance Harrison 10:11

Same boat. So, okay, all right.

Yohance Harrison 10:32

You're playing money, you know, money I paid for this insurance. I'm trying to get, bring it on back. Come on.

Jay Zigmont 10:38

And remember, Medicare covers nothing. They cover the first 90 days and then gone. And everybody's like, well, you know, the, the, the state will cover me. Well, states Medicaid after you ran through all your money. So you have to have a solution.

Yohance Harrison 10:53

Exactly. You do have to have a solution. Well, we used to joke again, water cooler talk advisors, like you've got one of three plans. Either you're going to use your money, if you don't have enough, then hopefully you're going to use a long term care policy. But if you don't have either one of those. Well, some states offer assistance if you really need it. And I know I'm being kind of crass, but that's, it's like, you know, but, but then I had an added joke for that. Excuse me one second because Bella is trying to join the podcast. Quiet. The physical therapist just showed up. I don't know if you guys heard the doorbell ring, but the physical therapist is here to help my mother with her walking. And Bella knows the physical therapist well and wants to go greet them. But she came up here so that I could do a podcast in peace just in case the Amazon man showed up. Be quiet though, Alex, you can leave that one in. Bella joined the podcast. All right. So

Yohance Harrison 11:54

I, I would push back when other advisors would say that because I have a grandfather who spent nearly 20 years in a long term care facility. He was well above average. So he got diagnosed with Alzheimer's and when he got his Alzheimer's he forgot that he liked to smoke cigars, he forgot that he liked to eat fast food and he forgot that he liked to to have a little bit of bourbon in his coffee because he was in the facility. So they were feeding him good, he was exercising, etc, so his pre diabetes went away, his high cholesterol went away and so did all of his heart conditions. Therefore he lived a long time with Alzheimer's. The last number I remember my parents sitting at the kitchen table complaining about as they spent all of his money and he had a considerable amount of money. He worked for Ford since a very early age and had invested in Ford stock and invested in real estate, etc. But he spent all of his money and I remember the conversation of him of his long term care facility costing $7,000 a month. And this is in the late 90s, early 2000s, so you can only imagine. And this is in Pennsylvania, this wasn't in Los Angeles, this wasn't in New York. This was in East Stroudsburg, Pennsylvania for those of you that know the area. So we're not talking a, a dense metropolitan area where usually things tend to cost a little bit more. This was just the cost of care for him. And, and yeah he ended up, the state ended up taking care of him but that was only after he spent everything and he passed away and there was nothing left in the inheritance except the home that was Homestead. That was it.

Jay Zigmont 13:42

So, and I'm with you and here. So here's the challenge. So we, we have a eight step program. We file for our program and number seven is plan for parents. And if you don't have a plan for your parents that can negatively impact your own financial plan. So you know, you're right. I'm life insurance, I'm a long term care insurance. There's a nightmare case I saw the other day. A person was in the hospital for 90 days, didn't pay their long term care policy during that 90 days, 91 days they go to claim on long term care. It had lapsed because the mail went to, you know, and all the other. So my answer to this is first of all figure it out for you. Second of all for your parents, you need to figure out what they have, what their financial plan is and if they're on. If they have long term care insurance, you need to get listed as an additional contact if it ever doesn't get paid. I had some of the other day, I was talking to and dad's kind of going downhill and we're like, hey, doesn't he have anything? He's like, yeah, I stopped paying that a few months ago because I didn't have the money. And I'm like.

Yohance Harrison 14:42

No, we will bor. We will start putting things on ebay to pay this long term care. It's funny because similarly, when I get the. My clients will get the email, the letter saying your premium's going up again. They'll say, hey, got this premium increase. What do you think? I'm like, well, you're still breathing. Pay it. Where am I going to get it from? I don't care. We will take it from any Roth ira, click Sale. Ira, sell. We're selling whatever. I don't. We're paying this long term care premium.

Jay Zigmont 14:59

Yep.

Jay Zigmont 15:09

You're paying it before you pay an electric bill. That's my.

Yohance Harrison 15:12

Exactly. Hey, I'm with you. We will ask for government assistance on the electricity bill and pay that long term care.

Jay Zigmont 15:20

So I came out of healthcare and I worked as a paramedic for years. And we know Medicaid facilities when you went in them. And I'll be honest, they're not great. They are nasty. And you knew them because you'd walk through, your feet would stick to the floor because they're that nasty, you know. And people are like, oh, well, the state will take care of me. You're right. But here's what happens. Medicaid pays 30 cents on the dollar. So guess what type of facilities you're.

Yohance Harrison 15:40

Going into.30 cents on the dollar facilities or actually 25 cents on the dollar facilities because they need to make a profit.

Jay Zigmont 15:49

Right. And what happens is I'll talk to people about this. So I tend to prefer for long term care policies, there's one carrier that I like that you can actually do a single Pay or a 10 pay. You pay it up, up front and just you don't have to worry about going up. And they're like, but that's a lot of money. And I'm like, yeah, because it's a lot of money.

Yohance Harrison 16:07

Hold on, Dr. J. We can drop names. Which one are you referring to?

Jay Zigmont 16:10

So I usually go with either NGL or Mutual of Omaha, depending on what state they're in. Okay, got it. And also, age matters because you actually can't get policy before 30 if you do it. And also the other problem is if your parents have a history of Alzheimer's dementia, it increases your cost and people don't realize that. So if both your parents have a cognitive decline, you will be uninsurable.

Yohance Harrison 16:16

Okay.

Yohance Harrison 16:38

Wow.

Jay Zigmont 16:39

I didn't know if one of them had it. Your rate's going about 50%.

Yohance Harrison 16:43

Well, it's my grandfather, so I'm good.

Jay Zigmont 16:46

Well, so here's the thing. This is why I tell people get it at 45, because as soon as your dad gets the box checked, your rate just went up. Yeah, like I have some people like, well, my dad doesn't have dementia yet, but you know, there's ob. Like, I'm like, okay, we need your.

Yohance Harrison 17:02

Policy last year because as soon as that.

Jay Zigmont 17:06

Because they're pulling all those records and it's one of those things that people don't want to do because it's costing, you know, I just did for a couple their mid-40s and I think it was like 260 is what they had to pay out of pocket for upfront. Just the whole policy covers $250 a day with a inflation rider. All that decent coverage, not perfect. And they're like, that's a lot of money. I'm like, yeah, but your care if you're in 40 when you're 80 is going to be $500,000 a year. And they're like, that can't be. I'm like 5% compound inflation. It just, it's. And especially in couples, if you have a couple that has like I have couples that have a big age difference, you know, five, six, seven years. Especially if the woman is the younger one because the guy tends to die earlier. What happens when one person in their long term care could completely derail the other person? Because we put, yeah, we can't sell the house because you got to live in it. And you start end up having these issues and people like, well, but it's so expensive. Like, yes, you need to figure out a solution.

Yohance Harrison 18:06

Yeah. You know, the other

Yohance Harrison 18:10

prevailing wind that we have that's going to affect premiums, quality of care is the gap that we have in the medical industry, the medical arena when it comes to the people available to provide the care. So they need more nurses, need more geriatric doctors, et cetera. That study has been coming out in the medical community for a while and we have the baby boomers that are the largest population in the US that is going to put a tremendous amount of demand for long term care facilities and long term care. So we know what happens when something becomes in high demand and is scarce. What does that do to pricing? Okay, for those of you that, that don't Remember, just, you know, the, the Finance 101 that means pricing is going to continue to go up. Okay. So that, it is, it is a, it is a problem that we have not solved yet here in America.

Jay Zigmont 19:17

Well, and, and there's this assumption that like I said, I Forget what. It's $32 trillion in the baby boomers gonna get past the next generation. Some stupid crazy number. I'm like, no, it's not. It's all going to long term care. It's going to healthcare. You think you're getting money, you're not healthcare.

Yohance Harrison 19:29

Yep, it's going to healthcare.

Yohance Harrison 19:34

I've, I've been in situations where we have had to. Actually I'm in one now. I have a, a client who, who needs long term care and did not have long term care policy. It was. So it was an early onset disease that, that, that happened. And now they need long term care and they are going to have to start liquidating assets at a pretty massive rate to keep paying for the care that's needed. Because basically the husband's at a point where he's like, I can't do this anymore. I've been doing it for a decade. I need help. I need a life which I respect. He's still relatively young, so. But they're going to have to spend a significant amount of mom's assets in order to get her the care she needs or to get to a point where she qualifies for some assistance. So there's that too. So.

Jay Zigmont 20:25

And then people try pulling games. Yeah, well, we're going to move U.S. assets around. Well, remember Medicare? Come on, you're not going to play that game.

Yohance Harrison 20:29

Oh, yeah.

Yohance Harrison 20:33

It's not stupid. The state is not stupid. Okay, I said this on a previous episode. I'll say it again. If they can go back and attack a previous president for the games that he. Financial games he was playing, I mean, whether he's found guilty or not, I think that verdict comes out today. It's Friday the 16th. Whether he's found guilty or not, he spent millions of dollars trying to defend himself. And this was a former president, billionaire. I'm sorry, Mr. And Mrs. Prospective Client and Mr. Client, I do not think you're going to be that fortunate. The state does not play. I've seen those letters come back that they were. The state has said, hold on, we did some checking. We need $137,000 because we know you had it there. We found this property that was in your name. What happened to this property? And it's like, oh, we transferred it to my name. Well, well, they saw that you recorded the deed. It's public information. So, yeah, let me get off the soapbox. Oh, Jay, you got me fired up.

Jay Zigmont 21:37

Well, but see, here's the thing though. Nobody wants to talk about this, okay? And I've heard people say, well, the government's going to fix this at some point because it's a giant problem. Like, well, they haven't so far, so what do you expect?

Yohance Harrison 21:48

And there's old people running the country, so they should know the problem as well as we do.

Jay Zigmont 21:52

Well, and then we get the worst situation. So now if you're in Washington, you get income tax. If you don't have a long term care policy or you can get out of it. So they get charged you, you know, 0.58% for life. And the coverage you get is $36,000, 500 bucks. So you get nothing. Remember I said $115,000. So I mean, that covers nothing. So California is looking to do the same type of plan. They're actually not going to have a cap. They were looking at something like 1% or more of your income just to help offset what the government's paying for long term care. And the coverage once again sucks. And what happens is if you have a long term care policy in place, you may be able to opt out of that income tax. That's happened in Washington. That's what looking at California, that's looking at New York, a few other places. And I've actually done the math for people, like, it's cheaper for you to get a long term care policy than pay that extra income tax.

Yohance Harrison 22:46

Yeah. In perpetuity.

Jay Zigmont 22:47

Yeah, right. So there's all these different things and people like, well, you know, I'll deal with that later. I'm like, wait. Like, I mean, you have to have a solution if you're going to self pay. So I have a couple right now trying to do this. They're mid-40s, they want to self pay. I said, okay, cool, we're going to put half a million dollars aside. It has to be invested, has to be 5% return. And we have to have a tax plan because, you know, now we got tax issues come with it. And that money you cannot touch for your retirement. You're like, really? With that much? I'm like, yeah, take what your mouth is today. They're like, well, hopefully it'll invest more. I'm like, hopefully is not hopefully.

Yohance Harrison 23:27

Hopefully hope.

Jay Zigmont 23:29

And we don't know, you know, if you end up like, you know, Your grandfather ended up 20 years of care, that $500,000 gone, gone. And, and it's one of those things that like, people just don't want to talk about. I've now got a point. So, you know, we primarily work with child free people. The only parents we take on are parents of our child free folks, where we're actually going in and doing a project plan essentially to go, what are their finances, what are their long term care, what is their insurance, what do they got? Because if you don't have a plan for your parents, no offense, but they end up moving in with you, I mean, that's what you're dealing with.

Yohance Harrison 24:03

Yeah, that's what I'm dealing with.

Jay Zigmont 24:05

And it can negatively impact your life. And people go, well, I don't want to have that conversation with my parents. I'm like, you're gonna have it at some point.

Yohance Harrison 24:12

You're gonna have the conversation. You're gonna have the conversation. It's coming and it's gonna come out right when you don't want to have it, right when you know you're, you're giving birth to your first child or not, or you just thought about taking the job that's on the other side of the country because you don't have kids, like, oh, I can do it, mom will be okay. And like, actually, mom's not okay. So, yeah, you're going to have the conversation. So speaking of conversations, I want to pause really quick if this is your first time listening to the Money Script podcast. First of all, welcome, welcome to the show. Hope you're having fun. I'm sure you've been hit with a lot of information. A lot of our listeners tell us that sometimes it can be hard listening to this podcast while multitasking because we hit you with some good stuff and you're like, oh, I didn't want to write that down. I want to research, search it. Well, guess what? You can just flag the episode. You can always come back later. We're still here. It's not going to go anywhere. It's going to be there forever. Okay, so flag it, come back later, listen to it again. And feel free to shoot an email if you have questions. We'll put Dr. J's information down in the show notes. So if you want to learn more about being a child free wealth client and learning, for those of you that are child free, I'm learning more about that. I have a few clients in that situation as well. I have two children, so I don't qualify. There's a Doorbell again. Dog is doing. Oh, she's thinking about it. She's thinking. Bella, focus. Good girl.

Yohance Harrison 25:38

So we are financial planners. What we do is we help people make better financial decisions with their money, and we each have our own styles, and we do believe of being on this podcast together. There are plenty of clients to go around. So we're not here to compete. We're here to share ideas and help you, as a listener, get on the path to, again, make better financial decisions. Now, with all of our guests, we'd like to learn a little bit about them. And I did learn something very interesting about Dr. J, and I'm curious to hear the story, because I don't know it yet. So in his bio, he stated that he earned his first million by the time he was 20. Was it 21? 21. 21. Okay, so the first. That sounds like a great story, but it gets better. And you spent it all by the time you were 25. I got to hear that story too. So if you would, Dr. Dre, tell us about your first million.

Jay Zigmont 25:50

Okay.

Jay Zigmont 26:14

22?

Jay Zigmont 26:28

You know, I grew up with nothing, you know, so my father was a bus driver. My mother was disabled most of my life. So that's kind of where you come from.

Yohance Harrison 26:35

Okay, I got to stop you there. My father was a bus driver. My mother was disabled.

Yohance Harrison 26:42

No, that's my story, too.

Jay Zigmont 26:43

All right, so we're in the right. We're in the same bus. Literally. Like, I used to spend my summers on the trips. All right, so we're in the right bus.

Yohance Harrison 26:49

Same here. Yeah.

Jay Zigmont 26:51

And, you know, he'd get a good tip. We'd have money for the week, and then we'd have no money for the week after. Like, just kind of how it works. So the problem there is I didn't really learn about money. I just didn't. And in high school, the only thing they taught me was how to balance a checkbook, which is a giant waste of time. So came out of high school, didn't have the money to go to college, didn't have the money for pretty much anything. It's the mid-90s, and the one thing I didn't want to do was do anything with computers, but that's when the Internet was taken off. So I actually went from my small town, and I put a resume on this weird thing called Monster at the time or one of those, like, sites that didn't, you know, we didn't know they existed in the mid-90s. And this dude gives me a call. He says, I want to come down for an interview in New York City. It was actually on 100 Wall street and I went down for an interview and he says, hey, want to hire you? Do sales in the Internet. Cool. Actually ended up a couple different companies because it's at the Internet time and you're bouncing all over the place and got lucky and hit an ipo. Now here's, that's the, that's the lotto. Okay? You know, you're doing well, you're pre ipo. You know, one night I'm broke and next night I've got a million dollars on paper. And that's also when you learn about AMT at that time and taxes and how that hits for the nerds in the group, you know what I'm talking about. AMT was a bigger problem in the past. And

Jay Zigmont 28:15

you get a million dollars at 21. And let's be real, most 21 year olds have no, no idea what to do with a million dollars. And what I did was I did some good things. You know, I paid for some of my sister's school, paid for some of my parents house. I did a bunch of things to help the family, bought myself a house, bought myself a Hummer. Like the old school Hummer, you know, like the Arnold Schwarzenegger old school Hummers back before they were like, you know, the tanks. Exactly. Had a lot of fun. And by a time I was 25, spent most of it. And it's kind of that easy coming. He's going, one of the things you learn there is people talk about money doesn't bring you happiness. You don't know it until you have it. Okay, like, like a million dollars. I'm good. I'm like, yeah. But then what? You know, and I, I actually went back to school then and kind of fun. I went from no degree to PhD in five and a half years. So, you know, did that all and actually did my entire school for less than nine grand. So I was able to like game the system because once you realize, hey, you had money and you spent it, you realize I probably should look at this a little differently. And you almost have to make mistakes to know when then to fix it or how or even look at it. And I hate to say like, you know, it wasn't a waste, you know, but if I put that money aside, I could just have lived off it, you know, by now. I mean, it's been many years since then. But I think I learned more by easy come, easy go somewhat and then going, oh, you know what I need to learn about what A budget is. And how to. What debt is and how does this work? You know, I bought a house for cash. That was cool. Might not have been the right choice. I don't know. You know, like. And these are the things you start realizing. And the thing that came very obvious to me is we do a terrible job in the US Teaching people how to manage money.

Yohance Harrison 30:10

Terrible. That's why this podcast exists. That's why that's exist, is to have an outlet, have something so people can get a dose of financial literacy. I still don't understand why I took biology. I don't understand why I took chemistry. I don't understand. I don't understand why I took calculus. I mean, because the calculator does everything I needed to do right now. A basic financial literacy course that went beyond balancing a checkbook that talked about, you know, life insurance, health insurance. I'm. I'll tell you a quick mistake I made. I didn't get

Yohance Harrison 30:44

gap insurance when I bought one. First time I financed a car, I did not get gap insurance, and I did not get uninsured motorist coverage. I was brand new to Texas. We didn't have uninsured motorist coverage in North Carolina. It was like, built into the policy in Texas. You had to check the box or decline it. I was like, well, who doesn't have insurance? You're making me get it. Everyone has it. And what does my car get hit by uninsured motors. And I didn't have the gap insurance and I had high interest rates. So I ended up with a. Not a foreclosure, but a repo on my record, because I didn't know. And I was 20. 20 years old. That would have been nice to know. Somewhere around 17 or 18. Hey, when you buy your first car, if you're financing it, you should consider these things. And here's why. You know, I didn't know that 25% of the people driving around Texas didn't have insurance. I assumed everyone did. I mean, why. Why would they not? I'm thinking, who would not get. Who's going to let someone get a car without insurance? But, but again, it wasn't taught.

Yohance Harrison 31:39

The frog.

Jay Zigmont 31:41

Yeah, I don't know if it's. I, I do believe it's a systematic problem, but I mean, there's also personal responsibility, you know, need to learn some of this stuff. And, and I think, you know, so my, my PhD is in adult learning. So since then, I, My focus is on helping people learn and come to find out the actual way we learn as adults. By experience. So you kind of have to have some of those things happen.

Yohance Harrison 32:02

Yeah, yeah, yeah.

Jay Zigmont 32:03

Everybody, everybody goes, I don't need insurance until they have a crash or something. And then they're like, oh, yeah, I needed that, you know, or something like that. And I think the hard part is some of those mistakes are really hard to come out of, you know, and I was, I was lucky. I came out without student loans. But people coming out now with, you know, $100,000 of student loans and they're 25, I'm like, oh, I'm sorry, Jay.

Yohance Harrison 32:27

Jay. Most of my clients are ER doctors.

Jay Zigmont 32:31

Yeah, four or five hundred thousand, half.

Yohance Harrison 32:33

A million dollars in student loans. I'm like, it's a big, that's, that's a lot. Now, fortunately, they're going to make 4 to 500,000 a year once they're active and practicing, but still got to live. I mean, at 4 to 500, you still got to pay about half of that in taxes, depending on the state you're in. So half a million dollars in loans is still a lot.

Jay Zigmont 32:53

I had somebody come out 200 grand in loans with a master's degree in social work. Do you know what you, do you know what you make as a social worker? About 50 grand a year.

Yohance Harrison 33:03

I, I see it, I see it. Teachers, the teachers I see in teachers all the time, they have to have all the advanced degrees and they go get them from a great school and then they go work and then they have the heart of a social worker and they want to teach and they go into an inner city school that's paying them 50, 60 grand a year and they have 2, 300,000 alone. Now fortunately, if they're in public school, there's some student loan forgiveness stuff that's out there now. But, you know, if they decide to go to even to a private school that maybe they get paid a little bit more, but it doesn't do anything for the fact they have a couple hundred thousand dollars of student loans. So. Well.

Jay Zigmont 33:40

Yeah, we give an 18 year old or 21 year old, you know, this money to figure out what to do. They're gonna make dumb decisions. I mean, the 18 year old version of both of us was dumb. Let's just be honest that. And I shouldn't be able to sign a loan for $100,000 at 18, just like. Yeah, you know, and I think the hard part is our system's really built around debt money. You know, we're not teaching how to use money. Not teach People, smart things. And,

Yohance Harrison 33:48

Oh yeah, it's just completely.

Jay Zigmont 34:10

you know, I, I don't, you know, I'm not one of those. I'm like, I don't want to look back and like, say if I could have changed or like, no, you learn from it. You do your thing and you move forward.

Yohance Harrison 34:20

True. Agreed. Agreed, agreed. Well, Dr. J, I really appreciate the time you spent with us. This was great. I, I forgot for a little while there, I forgot we were recording podcasts because we were just. Like I said, it was the water cooler talk. We're hanging out at the virtual water cooler there is now. You've told us a lot of stories about your experience with money, but I'd like to take it a little bit further back. As you probably heard some of the other podcasts you listen to, there is one question that we ask all of our guests and that is to share with us your first memory of money. So, Dr. J, what is your first memory of money?

Jay Zigmont 34:55

So my parents will always use this example and I vaguely remember, but just go with it. You know, it's one of those, like, family stories. They've said so much that you, you, you. I'm not sure if you remember or whatever. When I grew up, my grandfather sold Christmas trees. And this was, you know, they. That was just kind of family. Always helped on Christmas. You know, we did this and I don't know, five, six years old, I started a business at the Christmas tree place selling pine cones. And it was real simple. I would charge 2 cents a pine cone if I picked it up or 1 cent if they picked it up because we had Christmas trees. So there are pine cones everywhere. And it's become kind of a family story because, you know, it's like that. You start doing sales, you start going through it, and the aha to me is like, how the heck did the five, six year old version of me know? There's a value of labor and I should set a different price, but I'm like, I have no clue where I came up with that. But, you know, you realize, I guess I was always an entrepreneur.

Jay Zigmont 35:59

You know, these things you have with money, you don't realize how long, how much that stuff from where you started controls where you are now.

Yohance Harrison 36:10

You know, it's funny you mentioned that, because around here at the Harrison household, we really get into decorating around the holidays, especially about. My wife is a, is an artist at heart. And so she likes to, you know, she likes to decorate, likes to get into it. And I think there's this, this past Christmas, she came home with a bag of pine cones that she had purchased in a store. And I just. I just shook my head. I was like, you just paid for pine cones. I'm like, we could. We. We live in a densely populated area of trees. We could go find some pine cones. But someone put them in a bag and sold them to you. It's like, okay, great. I just.

Jay Zigmont 36:42

We're.

Yohance Harrison 36:57

Okay, sure. So I guess you must have sold that business at some point and it's now thriving.

Jay Zigmont 37:07

Well, some kids sell lemonade. I sold pine cones. You know, whatever you can do.

Yohance Harrison 37:13

There you go. There you go, indeed. So before we wrap up, Dr. J, you did mention to me that you. You authored a book or two. Is that true? Yeah.

Jay Zigmont 37:23

So the first book is already out, Ports of Child Free Wealth. Next one's coming out, the Child Free Guide to Life and Money. I work on, you know, the people that don't plan on having kids and aren't, you know, don't have kids. And how does that change their finances?

Yohance Harrison 37:36

I'm going to go ahead and say now I want to invite you back because I want to talk about gifting strategies. That is something that. That I get to talk to some of my clients that are child free. And we also do a lot of work with estate planning as well. So it's been coming up even more. So we should bring it back and have another conversation letter about gifting, especially for those that just can't put the default give it to my kids on their staple.

Jay Zigmont 38:02

Yeah. And. And I'm gonna spin it and say, okay, they should die with zero and give it a long. Give it away during their life, not when they die. So we could dig that, too.

Yohance Harrison 38:09

Yeah, there we go. Now we're talking. We should have this conversation. All right, so for people to want to learn more about you, your practice, and the books you wrote, where can they find you?

Jay Zigmont 38:19

ChildFreeWealth.com the Child for Wealth podcast and Child Free wealth on Instagram.

Yohance Harrison 38:23

Wow. Well, you know what? I gotta go check out your pot. It did say podcast. It was underlying. I thought that was the name of two books that does say podcast. Well, now I'm gonna check out your podcast.

Jay Zigmont 38:32

Everybody's got a podcast nowadays, you know, so, I mean.

Yohance Harrison 38:35

Well, we do. There's still a few people that are behind. I still. Hey, you know who you are. You said you were going to start a podcast. I haven't received the message that says I started my podcast, so you might want to go ahead and start. All right, well, with that, we want to thank you for joining us on the Money Script podcast. So a few quick things to take away long term care. You got to come up with a plan. If you're plus 40 or if you have parents that are plus 40, it's something that you're going to have to eventually talk about it. So you know, let's talk about it. Have the conversation, see if there's a plan. There's not a plan. Talk to a professional and come up with a plan. A lot of times you'll be surprised how much you can get or how much protection you can get because it doesn't always cost as much as you think. And then of course you have to beware if you are someone that already has parents or grandparents that are dealing with cognitive disabilities that can affect your qualification for long term care and the price that you pay. Also remember that sometimes we have to just learn through mistakes and that's okay. Sometimes it's the mistakes we make, the best learnings that we ever get. But guess what? You don't have to learn everything through your own mistake. You can hear the mistakes that we made. You can also just learn from us and learn from others. Okay? Listen to the stories and consider them. When you find yourself in the situation, especially for those of you that have been playing in the stop market recently, you probably are looking up and you have a lot more money than you used to have. And then last but not least, do yourself a favor. Flag this episode. If it was important to you, come back, listen to it again. I promise you're not going to remember all of it as you go on throughout the rest of your day. Today, whatever it is that you're doing, come back, listen again. You may pick something else up, write down some notes and again, like I said, reach out and get some help. So with that, tell a friend to tell a friend to tell a friend to get a dose of financial literacy to today and we will see you next time on the Money Script podcast. Take care.

Seth Harrison 40:43

I'm back. Wasn't that a great show? I hope you learned something. I know I did. Now before you go trying anything you heard today, remember it is not intended to be specific tax or or legal advice. If you need that, go see a CPA or an attorney. If you would like any complimentary consultation with a knowledgeable advisor, visit moneyscript.com and schedule a 15 minute consultation. Want Johans to come to speak at your next event? Go to the MoneyScript website for that too. Of course, if you're watching on YouTube, make sure to like comment, subscribe and click the bell for notifications. MoneyScript Wealth Management is a registered financial advisory service in multiple states. Want to learn more? Get the full disclosure on our website moneyscript.com.