The Motley Fool's Money After 40: Building Wealth for a Better Life - Softcover

Gardner, David

Softcover

ISBN 10: 0743284828 ISBN 13: 9780743284820

Publisher: Touchstone, 2006

Synopsis

With their famous wit, seasoned advice, and impeccable business savvy, the bestselling financial duo explains how to build wealth and security -- and how to afford anything you want when the work is done.

The Motley Fool's Money After 40 is for anyone who wants a stable future free from financial anxiety. You will learn how to fortify your portfolio to weather any economic climate and live the life you want regardless of the market's peaks and valleys.

Applying the principles of commonsense money management, David and Tom Gardner's goal is to help you determine what you will need and want when you retire and to guide you in creating realistic financial goals. From owning the right size home to affording sufficient health care coverage, from sending kids to college to taking that exotic vacation, The Motley Fool's Money After 40 explains how to:

· Organize your finances to preserve the funds you already have
· Master estate planning
· Determine whether you can turn a hobby into a small business
· Finance your children's education and care for aging parents
· Live a healthy, productive life free from fiscal anxiety

Comprehensive and amusing, The Motley Fool's Money After 40 is a one-stop financial guidebook for gilding the golden years.

About this title

About the Author

David Gardner learned from his father how to invest, and with his brother, Tom, started The Motley Fool in 1993 with a mission to educate, amuse, and enrich. Today, the Fool works to empower individual investors, reaching millions every month through its website, premium services, podcasts, radio show, newspaper column, and more. With Tom they have coauthored several books, including You Have More Than You Think, Rule Breakers, Rule Makers, and The Motley Fool Investment Guide for Teens.

Tom Gardner learned from his father how to invest, and with his brother, David, started The Motley Fool in 1993 with a mission to educate, amuse, and enrich. Today, the Fool works to empower individual investors, reaching millions every month through its website, premium services, podcasts, radio show, newspaper column, and more. With David they have coauthored several books, including You Have More Than You Think, Rule Breakers, Rule Makers, and The Motley Fool Investment Guide for Teens.

Excerpt. © Reprinted by permission. All rights reserved.

Introduction: May We Help You?

Everybody needs money! That's why they call it "money"!

-- David Mamet

It was the summer of 1994. The stock market was falling, talk of recession was in the air. The Internet was rising out of its niche into the mass market. And we decided to put everything professional on hold in order to transform our modest newsletter, "The Motley Fool" into a business. We had no anticipation of success. No plan to work together full time for the next ten years (had we known, things would be different). It was a sweltering summer in the nation's capital. We swept out the shed on the back of David's property, sat two computers side to side on rickety card tables, balanced Fool caps on our monitors, drank ginger ales, and set ourselves to the task of fielding financial questions online.

Should I buy stock in Intel?

What can I do to keep from getting rooked by a car dealer?

How can I teach my children about money?

What's the difference between fixed-rate and adjustable-rate mortgages?

Is my broker taking advantage of me?

What should I do if I have $9,000 of credit-card debt?

Is it a good idea to buy the annuity my advisor is selling?

Should I part with my shares of Xerox?

When is it best to take my Social Security distributions, at sixty-two or sixty-five?

The last decade has thrown a flood of financial inquiries our way. There were times when the flood was so ceaseless that our email boxes could've been declared Superfund sites. All the while our harmless little acorn venture, watered by your curiosity, was blossoming into an oak tree.

Two years later, we signed our first book deal with Simon & Schuster, the firm that's published our more than half-dozen books. Right about when the media started asking if the Brothers Fool could possibly be serious, we signed on to syndicate a column of financial education into the business sections of the nation's newspapers.

Public demand for education about finance was on the upswing.

And why not?

Seventy-five million baby boomers were heading into the second half of their lives.

We then cobbled together our profits and built our own studio at Fool Global Headquarters in Alexandria, Virginia, where each week we broadcast The Motley Fool radio show for NPR.

A study by market analyst Fallon Research concluded that one out of every four Internet users has visited The Motley Fool at Fool.com and that millions of people encounter The Fool each month.

Why the heck do you care about any of that?

Well, because you might be surprised to hear who it is we've been serving all these years.

Has it been college students or newcomers to the workforce -- anyone or anything approaching a potential date for thirty-six-year-old bachelor Tom Gardner? No. Even though we staunchly believe the best time to begin retirement planning is when you're twenty-one (it's a lifelong plan and pursuit), and even though we hope you'll share portions of this book with your kids, alas, our audience isn't markedly green. The occasional nineteen-year-old does come to one of our book signings, and we always draw everyone's attention to these forward-thinking young people and point out that by starting early, they -- in the words of the subtitle of our Motley Fool Investment Guide for Teens -- will likely obtain "more money than their parents ever dreamed of." But these devotees are few and far between.

So who are you all?

More than 80 percent of our audience is over the age of forty-five. Half men, half women. And only the smallest minority of you received a formal financial education. At book signings, conferences, and events, we've addressed primarily people like you, people treading either side of the half-century mark with questions about how to have enough cash to:

· Live a comfortable life

•; Provide fuel to worthy charities

· Pay for your kids to head off to summer camp (out-of-doors without PlayStation)

· Build your bridge to a second career

· Take care of your parents

· Bond with Jimmy Buffett in Margaritaville

In your hands, you hold the knowledge we've gained and shared with the many millions society has stuffed into a category called "baby boomers." Just about 25 percent of our nation's population fits into what sometimes seems an utterly useless classification: boomers. After all, you're everything under the sun. You're the most astonishing blend of diversity ever assembled in one place, under one flag. While you almost unanimously support individual, social, political, spiritual, and economic freedom, you share loads of distinguishing features.

So how do we speak to all of you individually at once?

Some of you are tall, some are reckless, some are poets, some own cats, some research individual stocks, some search the sky for meaning, some sleep late on Sundays, some prefer alternative healing, some love reading, some have recovered from cancer, some chew bubble gum, some run marathons, some find life absurd, and some would do anything imaginable not to read a book on financial planning for retirement.

But the great majority of you share one common trait.

We've said it once. We'll do so again.

What you know about money, you've learned yourself, often through trial and error. Damn that whole-life insurance package. And curse those penny stocks a broker sold you over the phone. But you've learned. All in all, you've done extraordinarily well. But do you have enough to ensure the freedom you'll covet from age sixty onward?

Our book's aim is to help you answer yes, but only if yes is the answer. For ten years now, we've worked with you boomers (we promise to avoid that trite word as much as possible) to draw up financial plans sturdy enough to transport dreams: a second home somewhere along the Pacific Ocean. Time to volunteer in the community. Sufficient health-care coverage. A chance to throw a little magic into the lives of grandchildren. A combination cruise-train-RV-jetpack-mountain-bike-airplane journey around the world. Enough dough to cover alimony payments and pay for your third husband's head of new hair.

The resources to turn a hobby into a small business.

Spare change.

The good life.

For Further Thinking

Whether building a financial plan or starting a business, you need to surround yourself with good people. Famous Wally Amos did just that:

David: How'd you start Famous Amos Cookies?

Wally Amos: In Hollywood, California, 1975. Opened the first store to ever sell chocolate chip cookies. It started with just an idea -- as everything starts, with just an idea -- and I got a group of friends together who supported it. Helen Reddy and Jeff Wall were initial investors. Marvin Gaye was one of the initial investors. I started with an investment of $25,000.

Tom: This was your Dream Team.

Amos: It was my Dream Team. No question about it. But you know what I discovered also is that they believed in me. They did not invest in an idea. I think people invest in other people, not in ideas.

Yes, the whole purpose of this book is to secure for you just that: the good life. Our book is laid out in four simply titled sections:

I. Get Ready

II. Having Enough

III. Having More Than Enough

IV. Having It All

This book is about gathering the resources to have it all. Veteran Fools know all this demands capital. But we aren't money-obsessed, and we don't wear blinders to the nonmonetary beauties of life. Having it all does not merely mean having a ton of cash. Not everyone has figured that out; a den of thieves in corporate America pilfered the system at the turn of this century for massive financial gain. They have enough. In a financial sense, they have more than enough; they're loaded. They'll ski the Matterhorn. Body-surf the Caribbean. Lie down in soft silk sheets. And rise to servants offering Egg Beaters, wheat toast, fresh strawberries, and a tall glass of freshly squeezed orange juice any day they darn well please.

But is that really having it all?

It may seem like it at times. On the surface, it is.

But what's always been missing in such people is any appreciation or understanding of the relative values of those things that can never be bought. Honor, self-respect, integrity, goodness -- things worth more than any silk sheet or served entrée. You don't need to settle for either financial security or a meaningful life. You should have both.

Every one of us, no matter where we are today -- in fact, no matter what we've done -- has a shot at claiming financial security and a soul. You may be forty-nine years old, with $14,000 in credit-card debt, an oversize mortgage, a stock portfolio that collapsed, a child in and out of reform school, and no job stability. Or you may be a retired telecom executive who skimmed $20 million out of your business before it went under. Yes, you, too, can have security and a soul. (Our first recommendation -- get down to the business of giving lots and lots away.)

Most of us are somewhere in between those extremes. The challenge is to continue or to get started in the right direction. For a Fool, life is always more about future direction than present location.

So what lies ahead for you in these pages?

A flurry of opportunity, an integration of philosophy, a chance to learn.

In "Having Enough," we'll help you organize your finances, save more cash, cover your health-insurance needs, build a suitable investment portfolio, and calculate what capital you'll need for the next few decades. In "Having More Than Enough," we'll unravel Social Security, paying for your children to attend college, caring for your parents, and strengthening your investment portfolio. In the final section, "Having It All," we'll provide detailed advice on how to squash people en route to becoming a powerhouse corporate executive, how to fraudulently design shell corporations, how to cajole auditors into crooked accounting, and how to siphon shareholder money into offshore accounts.

Or not.

In truth, our final section will set you up to live a healthy, productive life -- one with hobbies, an adventure or two, and even a second or third career.

We admit that the decision to put a given chapter in a given section of a book is by no means clear-cut. Many might argue, for instance, that "What to Do with Your Parents" is a necessity, and therefore is about having enough, not having more than enough. In our experience, continuing and eventually ending (at death) your relationship with your parents -- done really right -- is something many people unfortunately can't optimize, due to other limitations or demands on their time, geography, or limited resources. That's why we think of it as having -- or, in this case, doing -- more than enough. As the philosopher says, "Your mileage may vary." Of course, we hope you'll read the whole book and, where necessary, cut us a little slack if our ideas of what is average and what is above average don't conform perfectly to your own notions. As we said above: This book truly is about helping you where you need to be helped, regardless of what level of affluence or freedom you enjoy or aspire to.

We believe that in our own ways, on our own terms, every single one of us can have it all from here, no matter how prolonged or brief our stay. Is it not so evident to you that some people gain vitality, wisdom, charm, financial freedom, patience, have better sex, take better care of themselves, and have increasingly more fun as they age? They're out there. They're planning, learning, seeking, growing.

You should be one of them.

If, by the close of this book, we've helped you identify your goals and assemble a realistic and cohesive financial and life plan, we've earned our bells.

Most of all, we want you to enjoy a good, page-turning read. The Motley Fool's aim is ever to educate, to amuse, and to enrich. None without the other two. Onward, then, for an adventure, a laugh, and learning.

Copyright © 2004 by The Motley Fool, Inc.

Edition details

• Publisher: Touchstone
• Publication date: 2006
• ISBN 10: 0743284828
• ISBN 13: 9780743284820
• Binding: Paperback
• Language: English
• Number of pages: 272