The Status of the Dollar – Episode 571

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[00:01] Welcome to the Prosperity Podcast. Prosperity thinkers, welcome to the podcast today. We’re going to be talking about the dollar and we’re going to be talking about the real important pieces of the dollar. This is not an economics lesson. This is actually how it will affect you and your family. And by listening to this at the end, you will know what will strengthen you and you are going to know where you’re going to get ahead from everyone else. So, Kim, this is a topic. We’ve covered something like this before. Set the stage and then I’m going to ask you some follow-up questions because this actually comes from one of our listeners. Yes, our favorite thing to do is cover listener questions.

[00:41] So, thank you for Anne who sent this in. And that’s an interesting space because I get it. I understand why it’s a question. I understand why it’s a concern. And yet it is imperative to me that people know how to think about this. I mean, our company is called Prosperity Thinkers. And it is because those of us that are in growth mode, which frankly everybody should be until the day that they die, turn their brains on and think for themselves. They don’t just let the press or their family or a spouse or their friends or social media overtly influence how they live their lives. And every aspect of every day starts in our thinking. And so I’m very honored to be able to have the discussion, to be able to share with our listeners a better way of thinking,

[01:37] or I should say an even better way because some of the listeners may have a good way to think about what the press is talking about as it relates to the dollar and whether it’s going to be valuable or whether we’re even going to be on it or the myriad. There’s a host of long, long list of concerns and questions and debates that could be talked about. And yet, just like the FBI and the police study the real dollars and the real coins, they don’t try to figure out what all that counterfeit stuff looks like. They just study the truth. And from that, they know when a counterfeit spot pops up, whether it’s a dollar or a coin or what have you. And so that’s what we’re going to do. We’re going to mentally or with our brains on or with our thinking,

[02:34] study the truth about this space so that we know what to do when the quote counterfeit comes up, which is essentially that long, long list of fear of, oh my gosh, what happens if the dollar fails, sinks, gets destroyed, gets taken over, et cetera, et cetera, et cetera. Yeah, you know, it’s interesting you mentioned the term counterfeit because there’s a variety of counterfeit pieces that happen with the dollar, meaning the news can be a counterfeit. It can sit there and it can give people incorrect information. We can be counterfeited by having a financial advisor put a person’s money into the wrong product. We can have counterfeit by not understanding the true effects of inflation. There’s a lot of pieces to that.

[03:32] So I’m going to push on a couple of things that may be helpful. So to give context, I’ve done a lot of travel this past year and was able to visit a couple different countries that were interesting. So right now, Japan is getting hammered with their currency. It’s the worst that it’s ever been. So if we go back just a few years ago, we’ll call $1 is 100 yen. Right now, it’s like $1 is 155. Argentina, even worse. We’re talking like hundreds of percent inflation a year. That is something we’ve never seen in the U.S. But coming back to the U.S., where I currently am right now, then I’m seeing the effects of that inflation. So really, this counterfeit, the dollar, all of that, that’s fear. So, Kim, you have been a master at teaching, coaching, helping people

[04:32] when they have a financial fear and being able to say, okay, stop and let’s turn this around. So let’s start at the foundation. Let’s attack the fear and then turn it from there. Well, thank you for your compliment. And yet, it’s still something that I deal with. And when we make decisions from a position of fear, they are usually the wrong decision. And oh, my gosh, I could tell story after story, including some just recently. About making decisions out of fear. Maybe it wasn’t monetarily, but it doesn’t matter. It’s all the same. And so while I appreciate your comment about how much I talk about this, how skilled I feel like I have come, literally the very next moment, I’m dealing with it again.

[05:19] So this is a skill that needs to be practiced, sometimes daily, sometimes hourly. And as it relate to, and this is, I think, what it all boils down, as it relates to fears that we can control, we want to do what we can to do something about them. As it relates to fears that we cannot control, those need and should and you want to cross them off your list. So right at the beginning, whenever a fear pops into your head, it could be a health fear. It could be a monetary fear. It could be somebody’s comment causing fear. It could be something that’s physically happened to you. It could be something that you’ve read about. Immediately ask that first question. Can I do anything about it? And if you can do something about it, then do that.

[06:16] Even if it’s just a tiny baby step. If you cannot do anything about it, if it’s nothing that you can control and nothing that you can do anything about, then cross it off your list. Now, let me put the question back to you, Spencer. Do you think that’s burying your head in the sand? No, I don’t. Because I personally look at what I can control. And then the other thing is I’ll often investigate, why am I having this thought? And it can many times, if it’s around finance stuff, a lot of the time, and I know this sounds awful, and I’ll just admit it, it’s fine. Which is, it’s a comparison game. Oh, this person did that? Wow, I could have done this. Oh, I should have done this. And it’s playing this game that doesn’t ever work.

[07:05] Right. But I’m human. Yep. And because of that, you deal with it. And we deal with it in all areas of life. Because our eyes see things. Our ears hear things. And what’s the quote? Comparison is a thief of joy. Now, sometimes comparison can be valuable. We learn with comparisons. But when we compare ourselves to others, whether it’s about an investment opportunity or somebody that’s lost money, so it can be a positive comparison, it can be a negative comparison, we immediately stop our brain from being able to help ourselves. Because we’re so focused on that other person’s environment. And so this is true around the dollar as well. And to me, really all financial decisions and concerns come down to cash flow and cash flow control.

[07:57] And we can control our cash flow. And so that is something that we should be focused on, not what some government or some country may or may not do. And I could definitely get into some of the economics as to why I don’t think the dollar will ever in our lifetime go away from being the position that it holds in the world. But frankly, it doesn’t matter. Because if that did happen, we would have a lot other things to focus on that we could control. Yes. Not be about the dollar and whether it was the standard currency or not. Yeah, I will say I don’t have that certainty, I wish that I did, of the dollar being that. The reason for me is because of the central bank digital currency that they keep popping up.

[08:52] Now, for listeners that don’t know what that is, it’s a digital currency. Essentially think of it this way. This is the best way that the government can control you and how you spend your money. And we’ve seen this happen in other areas. And the problem with it, in theory, it’s a utopian amazing thing because it’s fast and easy. But in theory, the government could come in and say, no, we really think that you purchasing beef is going to be harmful to the climate, and so we’re not going to allow you to do that. Or we’re going to charge you a 50% or 100% tax or whatever that may be. That’s the part that is scary. Now, is it happening? No. Is this something that we need to think about today and worry ourselves? No.

[09:40] And then the follow-up from the question of Anne, which was at the top of her list, was, hey, how do I simplify the streamlining of my financial life? That’s the right kind of question to ask. It’s not sitting there saying, what do I do if the dollar collapses? No, it’s like, hey, how do I streamline this? So let’s probably hang out in that area just for a moment, if you may, and throw a couple of concepts that may be helpful because we want something actionable for listeners right now. Absolutely. And simplifying and streamlining are so valuable. I was just at an advisor event last week where my husband, Todd Langford, teaches other financial advisors, especially whole-life-friendly financial advisors and agents,

[10:27] how to prove whatever the numeric concept is that they’re talking about. It could be a 15-year versus a 30-year mortgage. Please pay only 30 years. It could be life insurance works. It doesn’t. It works. These are the kinds of things he proves. Completely independent software, not connected to any product at all. And one of the things that came up were a variety of examples of complex client scenarios. I was saddened by them. You’ve got layers of LLCs and corporations and trusts, and then the end product, all really just doing one job, what the end product is supposed to do. Now, absolutely, there’s value in having LLCs and trusts. Please don’t misunderstand me. Nevertheless, there are some things that you can do

[11:16] to simplify your finances, especially if you are in your later years. Now, the bulk of our clientele, our younger families, we love that. Nevertheless, because of me being in my mid-50s, I have seen in the 30-plus years that I’ve been helping people with finances what does work and what doesn’t work for those that are in their 60s, 70s, and 80s. And in this simplification quest, it is of utmost importance that you lock in and get some guarantees and some certainty in your dollars. And I use the word certainty very specifically because a lot of people look at the word secure. They want their dollar secure or they want security around their dollars. Well, unfortunately, long, long ago, Wall Street dull that word,

[12:06] and they call stocks and mutual funds securities. And unfortunately, it’s probably the biggest misnomer in our entire financial language. And so there’s two specific products, and they do both come from the insurance realm. And insurer is a term that we can be certain about. And both of them use actuarial science. So math and financial numbers and personal finance math, we’ve talked a lot about how different that is from grade school math. Well, actuarial science is a completely different element of numeracy, really. You know, dollars and math and accounting and that kind of thing. But it’s all age-based. And so you, as a person in your 20s, want to become aware of actuarial science and use it all until your 70s,

[13:06] for example, while you’re building up the wealth. And that’s typically with life insurance and a product that will benefit for you, for your cash and liquidity, your emergency opportunity fund, which we’ve talked about numerous times on this podcast. And then the other side of actuarial science that can help simplify things so drastically is a single premium immediate annuity. And these are often abbreviated as a SPIA, S-P-I-A, single premium immediate annuity. And it means that you take a hundred thousand or a million dollars or eight million, it doesn’t matter what the number is, and you purchase an income stream. And it’s a guaranteed income stream for life. And this is something that people

[13:49] that don’t have a lot of money should do with just a little bit of their money, that it will guarantee an income stream. So you have social security as your base, and then you have your guaranteed income stream from your SPIA on top of that. If you have more money, maybe you use it to purchase a larger income stream, but it’s literally converting an asset into a guaranteed income stream for life. That will simplify finances. And if you’re not in your 70s, it’s so awesome to know that when you get into your 70s or 80s, this is a product that’s out there, and it is the opposite side of actuarial science. Life insurance uses actuarial science to pay if you die early. SPIAs, income annuities, guaranteed income annuities,

[14:36] not index, not variable, none of that, guaranteed, pay if you live a long life. And so you want to have both sides of actuarial science working for you. Ooh, that’s so good. That’s so good. To unpack a couple of pieces for our younger audience, because that is the, we’re going to call it, not the end goal, but that is a trajectory of where we’re going towards. And for our earlier and younger listeners, what Kim has shared is not often talked about on podcasts, because one, it’s not shiny. It’s not exciting. It’s usually talking about how to manipulate your home equity line of credit and paying off this thing and that thing, and again, the complicated stuff. But what we have talked about at the beginning of this episode is that,

[15:32] one, making sure we have our head game correct. We’re overcoming the fear. Two, that we’re learning, we’re keeping our minds open. Three, we’re in a community that’s doing that. Four, we’re using the right resources and tools. You’ve done a lot of these things, listener, just by being here on this podcast. So if you do have additional questions, depending on what your circumstance is, if you’re in your 20s, 30s, 40s, 50s, 60s, even if you’re in your 80s, I hope you’re not driving, and in your 90s and listening to the car, maybe at the point you’re relaxing and listening to this podcast. Regardless, reach out to helloatprosperitythinkers.com to get feedback on your exact situation. And then there’s a coaching,

[16:20] there’s an ability to take it to that next level. Does that work out, Kim? Yes, love to help. I’m more than happy to answer quick questions. And also for those that are interested, delve in and get their finances simplified and streamlined. Those are good word. Thank you for listening to the Prosperity Podcast. To take control of your money and have it work for you, visit prosperitythinkers.com.