Segment 1: Life Insurance, Wills, and Trusts SEGMENT BEGINS AT 00:38 Are you prepared for life’s major uncertainties? Nobody plans to fail. They just fail to plan. In this segment, Jerry Robinson wraps up our ongoing discussion of Level Two of our Five Levels of...
by Jerry Robinson | FTMDaily Editor-in-Chief
HOUSTON, July 9
It’s Friday. And that means that its time for FTMDaily’s Reader Q&A. Each Friday, we reserve our daily column for our readers and their questions. Whether you have a question about your money, our Five Levels of Financial Freedom, the global economy, commodities, or retirement savings, we invite your questions. (To submit your question, click here.)
Tell me more about the Five Levels of Financial Freedom
Q: Jerry, I just stumbled across your website and I am so thankful to have found you. The media has been scaring me half to death and I am worried sick about my retirement plans, my social security check, and the future of this country (especially for my grandkids’ sake!) You recently mentioned something about your Five Levels of Financial Freedom on your radio show and I would love to learn more about this. Please send me any information you can. Thanks for your hard work! (Susie H., Whitefish, MT)
A: Susie, thanks for the good question. Our organization did recently create something known as the Five Levels of Financial Freedom. Here’s a graphic explaining it below:
In Level One, your goals are to:
- Create a Charitable Giving Plan – (Similar to a financial plan, only estimating a goal of how much money you want to give away over your lifetime.)
- Create a “Go” Bag – (A 72 emergency kit containing all of life’s essentials for at least three full days, in case of a home fire, wicked weather, or other disaster.)
- Create 3 Months of Food and Water Supplies
- Begin a Systematic Savings Plan – (Your ultimate goal is to save at least 15% of your income each month. But begin where you can.)
- Build Two Months of Savings – (Based upon your current gross monthly income)
In Level Two, your goals are to obtain adequate:
- Asset Protection: Auto, Home, and Liability Insurance
- Income Protection: Disability, Health, and Long-Term Care Insurance
- Life Protection: Life Insurance, Wills, and Trusts
In Level Three, your goals are to:
- Build a Total of 6 Months Food and Water Supply
- Build a Total of 6 Months Gross Income Saved
- Diversify Six Months Liquid Savings – (Example: 1/3 in U.S. Dollars, 1/3 in Stable Foreign Currencies, 1/3 in Precious Metals)
In Level Four, your goals are to:
- Invest Broadly Across Various Asset Classes
- Remember P.A.C.E. for Inflation Protection – (P = Precious Metals, AC = Agricultural Commodities, E = Energy)
- Avoid Overweighting in One Area – (Because the “rules of the game” can change at any time)
- Trade Cash for Cash Flow When Possible
- Create Multiple Streams of Income – (In order to achieve financial freedom, income diversification is vital)
In Level Five, your goals are to advance into:
- Opening or Expanding Your Own Business
- Stock/Option Trading Strategies
- Venture Capital
- Real Estate Strategies
Susie, it is important to build your financial plan by first laying a solid foundation. Most people approach financial planning backwards. I believe that the above model that we have created emphasizes the proper order for which a financial plan should be constructed. If you would like to learn more about each of these Five Levels, consider subscribing to our FTM Quarterly Newsletter (click here to learn more). Our newsletter covers each of the levels in depth and would likely answer all of your specific questions. Thanks for your readership.
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Jerry Robinson – FTMDaily.com
Jerry Robinson is an economist, published author, columnist, international conference speaker, and the editor of the financial website,FTMDaily.com. In addition, Robinson hosts a weekly radio program entitled Follow the Money Weekly, an hour long radio show dedicated to deciphering the week’s economic news.