You are on page 1of 24

The

SIMPLE
FINANCIAL
Life
_______________________________

How to get what you want


without debt
or living paycheck to paycheck

Dan Keppel
Author of The Insiders’ Guides to Buying Discount Financial Services:
Buy Direct and Save Up to $3,000 Every Year

IAN Books
An IAN Books paperback

Published by
IAN Books
41 Watchung Plaza, B242
Montclair, NJ 07042

Copyright © Dan Keppel 2009


All rights reserved. No part of this book or its Interactive Internet CD can be reproduced, transmitted in any
form or by any means, electronic or mechanical, including photocopying, recording, or by any information
storage and retrieval system, without the written permission of the publisher, except where permitted by law.

Special sales are available for the educational use by nonprofits.

ISBN 1441499326
EAN-13 9781441499325

Save on almost all financial services


FREE email Alert weekly

Send email to:

Editor@TheInsiderSGuides.com

ian books 2
For my Father and late Mother
They always gave to others

ian books 3
To purchase a copy of

The Simple Financial Life


go to

Amazon
TheInsidersGuides.com

The Simple Financial Life

A Will. The court might give guardianship to someone you don’t


like.
Power of Attorney. If you are in an accident, you need someone to
fight for you.
Financial Plan. If you have a dream, you need a plan to get there.
401K Retirement. Employer gives you money and Uncle Sam
waits for his.
Roth IRA. The Best: your savings are compounded and tax-FREE.
Self-insurance Fund. Manage all your risks for less.
Let the Insiders save you money. TheInsidersGuides.com.

ian books 4
Contents

Introduction 7

Part 1
1. What do you really want? 15
What you would do ANYTHING to get

2. How are you going to get it? 27


Without a plan, dreams are just a fantasy

3. Snoring is the best way 43


“We continue to make more money when snoring than when active.”

4. There is no better protection than owning … 55

“assets that grow by themselves”

5. Enjoy your financial freedom! 69


“The great American tradition of self-reliance”

Part 2

6. Insure your lifestyle: Build your Self-Insurance Fund 77


Saves $20,000 over 20 years.
ian books 5
7. Buy Living Insurance to protect your lifestyle: 87
Cover many ‘lifestyle’ risks with the same dollars

8. Create your own ‘bank’: 97


Your ‘bank' can provide $250,000 in 15 year

9. 12 Things your Agent, Broker, Banker, Money Manager … 105


Won’t Tell You
10. What NOT to Buy: 109
101 financial products and services NOT to buy and why

11. Make Your Spending Plan 137


The difference between you and a millionaire

Conclusion: You can do it yourself! 149


Save $3,000 Every year, Accumulate $939,423

Resources 155

Acknowledgments 157

Index 161

Author 166

ian books 6
Introduction

In 322 BC, Aristotle wrote:

Money is a guarantee that we may have what we want in the future.


Though we need nothing at the moment, it insures the possibility of
satisfying a necessary desire when it arises. Ethics Book V

This book is about living The Simple Financial Life using the new 21st
Century way of buying financial products and services.

• Buy whatever you need without going into debt.


• Create a Wealth Reserve of $943,423.
• Use the best legal tax shelter: no taxes . . . ever
• Protect your family and assets with your Wealth Reserve.
• Borrow from your own ‘bank’ to pay for large purchases.
• Buy your financial services at a discount and save $3,000 a year.
• Manage your investments in 15 minutes per quarter.
• Practice the FIVE actions for financial freedom.

Financially independent people live The Simple Financial Life. The


Simple Financial Life consists of five actions. You don’t have to be
wealthy or a genius to become financially independent. The FIVE
actions provide the foundation of financial freedom. Financial freedom
allows you to live the way you want to without having to worry about
money. You are confident in your financial decisions. You reach your
financial goals. Read Aristotle again. “Money … insures the possibility
of satisfying a necessary desire….” You need to create a wealth reserve
of assets to insure that possibility later.

1. People who are independent have goals.

ian books 7
This action is part of their everyday life. They don’t make goals in their
20’s and then forget them. They discuss them all the time and make
changes as necessary. They have a purpose in their lives. The goals do
not dominate their daily zest for living. They guide their spending and
investing habits. They are part of their value system. The goals are
sometimes big—having a retirement nest egg of $3 million by age 60.
Sometimes they are noble—be able to provide funding for a church
choir leader within 10 years. We can satisfy our “necessary desires” only
after we clarify what those desires are for the future.

2. People who are independent have a strategy.

This follows the goals. To be able to have a retirement nest egg of $3


million by age 60 requires that you know how to start investing, invest
regularly, invest properly, monitor accumulations along the way, and get
help when you need it. It takes only an hour to set up your Simple, Easy
and Wise Plan in Chapter 2. It takes only 1/2 hour per
quarter to manage your Simple, Easy and Wise Plan. Goals
Strategy
3. People who are independent have patience. Patience
Protect
This may seem a simple matter but many people who are Enjoy
not independent do not understand that you have to be
patient in order to cultivate the "assets that grow by themselves."
Independents buy assets that grow; not "things" that require them to pay
out income for the rest of their lives. Warren Butter, Master investor said:
“We continue to make more money when snoring than when active.” Time
rewards you when you are patient. Practice the five actions for 10,000
hours and you master financial independence. It becomes a habit like
brushing your teeth.

4. People who are independent protect what they have.

This doesn’t mean buying a lot of insurance. It means understanding the


role of risk and reward in everyday decision-making. For instance, why
pay for medical insurance in your car insurance policy when you already
have medical insurance? Your self-insurance fund, a Wealth Reserve, as
I call it, allows you to carry large deductibles on all policies and
accounts, saving premiums. Skip the “bells and whistles”--buy only
what you need—catastrophic risk insurance. Thrifty independents buy
ian books 8
only the protection they need. The best protection is having a Wealth
Reserve of various "assets that grow by themselves" making income.

5. People who are independent enjoy what they have.

This means appreciating what is important to you--family, friends, a


hobby--and not buying a lot of “things” you think will make you feel
good. Independents realize that you only have so much money and time.
Time with your family and friends is precious. You can’t buy time. You
can waste a whole life of time making the money it takes to pay for
“things.”

How to get what YOU want

What do YOU want? It is impossible to live The Simple Financial Life


until you know what you want. If you have not decided what is
important to you, how can you live without money worries?
Once you know what you want, how are you going to get it? If
you don’t have a strategy, our consumer society has one for you—credit.
Being in debt is the kiss of death to your financial freedom. No one
wants to be in debt but most people fall for the “buy now pay later” trap.
Fortunately, there is an alternative: the power of compounding.
Those who use the POWER OF COMPOUNDING magnify their
earnings from working into a huge Wealth Reserve
—my name for all their “assets that grow by Compounding:
the “most
themselves.” The wealthy have learned that powerful force
patience creates WEALTH—not brilliant stock in the universe”
trading or “flipping real estate.” $100 becomes Albert Einstein
$10,000 over time. Independents protect their assets
that grow by not spending them. $100 spent today eliminates $10,000 in
time. They have learned that life is too short to waste on accumulating
‘things.’ Family and friends are where they spend their time.
Let’s take an example of how to satisfy a financial need the
complicated way versus the simple way. Most people deal with the need
for transportation sometime in their lives. You want a vehicle.
There are two ways to buy a vehicle—the ‘consumer’ way and
the independent way. Most consumers take a loan that will cost them
interest for years. The vehicle will go down in value as they take more
ian books 9
money from their paycheck to pay off the loan. The independents’ way
is to pay cash from their Wealth Reserve which is composed of
contributions from their salary AND interest earned by the money itself.
Let’s say you don’t have a lot of money. Most people do not have
a large bank account—they don’t have a large asset reserve—a Wealth
Reserve. Most people take out a loan. When they shop for a car, they do
not bargain for the lowest price since they have no leverage with the
seller. Most car dealers and manufacturers make more money from the
financing than they do from the sale of the vehicle, according to
BusinessWeek, 7/12/4. When they make more from financing, you pay
more overall for your ride.
Which way is better for you to pay? Financially independent
people love their financial freedom, not their vehicles. I use two of our
members in this example. Denise bought a car before I met her. Joy
bought her car after she read The Insider’s Guide to Vehicle Purchase.

Consumer way. Denise took a loan for the full amount of the price.
During the paperwork process with the F&I person (finance and
insurance), she was persuaded that the gap insurance and window glass
etching options were good buys. Instead of getting a lower price, Denise
assumed that an extra $25 a month was no big deal. This was the deal
she finally agree to:

Total borrowing: $25,000 @ 16% for 72 months (her FICO score is 610)

Monthly payment: $542.30 Total payments: $39,045.60


Total interest: $14,045.31 Final residual value: $5,000

Denise spent almost $40,000 for an asset that has little value after 6
years. During those 6 years, she could have accumulated a Wealth
Reserve of $57,352.04 on the $542.30 monthly payments. Thus, buying
the vehicle on time actually cost her $40,000 plus $57,000 she could
have had by investing the payments. The car cost almost $100,000.
http://www.moneychimp.com/calculator/compound_interest_calculator.htm

The real cost of buying a new vehicle is FOUR times the price.
Not a great deal.

Independents’ way. Joy had been buying “assets that grow by


themselves” with $500 a month for some time. She had been growing
ian books 10
her Wealth Reserve. She started her Wealth Reserve by using our FREE
Guide at http://www.theinsidersguides.com/freeguide.html. See Chapter 2.
Independents use their Wealth Reserve balance for all their
financial needs. Thus, their Wealth Reserve can earn 10% to 12% over
time in stock and bond mutual funds. They can ‘borrow’ $25,000 from
their own Reserve or ‘bank’ and pay themselves back by continuing to
invest $500 for the 6 years. Joy pays monthly like Denise but to a
different account. The $14,045 interest that Denise pays to another bank,
Joy compounds in her own ‘bank.’ Joy accumulates about $53,000
during the six years—replacing the $25,000 she ‘borrowed’ to buy her
vehicle. The vehicle is still worth only $5,000 but Joy has grown her
Reserve by $28,000. Also, because Joy paid cash for a used luxury car,
she probably got a lot more vehicle than Denise got for her borrowed
$25,000.

As you guessed, the Independents’ way is how financially


independent people stay wealthy. They paid their own “bank” and
got the car and the extra $28,000 for the same $500 expense.

It is common for most independent people to purchase USED luxury


vehicles instead of new because the value of new vehicles drops so
quickly. They hate to buy assets that lose value because they know they
could be putting their hard-earned income to better use. In fact, many
prefer to have a more reliable 9-year-old Lexus than a new Mercedes
ML. http://www.usatoday.com/money/autos/2007-02-28-cr-reliability_x.htm
Would you rather have an extra $28,000 or be out $40,000? That
is the question when you decide to buy a vehicle. This stark contrast is
why Warren Buffett, world’s wealthiest investor, refused to give up his
VW Beetle for so many years. The Tao of Warren Buffett, p. 3.
This example illustrates how financially independent people go
about making decisions in their lives. To keep their lives simple, they do
not use debt. Instead of enduring lives of constant worry about how to
pay for things they use up, they set goals they can reach using a strategy
that magnifies their earnings. They can buy everything they want
because they have purchased “assets that grow by themselves”—no
additional hours of work are needed. They are patient because they have
learned that this is the only way to accumulate the $1 to $2 million
additional spending they will need to reach their goals. They know what
is important to them and they protect their ‘eggs’ while they grow. They

ian books 11
are patient because they have learned that all good things come to those
who wait for their “assets to grow by themselves.”
It is as simple as squirrels gathering nuts for the winter. It is as
easy as learning to bush your teeth. It is as difficult as being a patient
person.

The Simple Financial Life

You can have The Simple Financial Life by following the steps in the
following chapters. As I work with people at various stages of their
lives, I believe they come to realize how simple their financial life can
be. They just need to get past the misinformation they learned from their
parents and the financial industry. Most people did not learn the
financial facts of life at home or in school. The industry has a vested
interest in keeping secret the fact that being financially successful does
not require a middle man or woman. It is not complicated. The industry
takes $65 billion a year from us by making it look complicated. See John
Bogle’s estimate in Enough, p. 145.
It is not complicated, but it is not easy either—you have to avoid
being tricked and misled. Living The Simple Financial Life is really
about habits. When you were a child, you practiced brushing your teeth.
It became a daily habit. You don’t have to think about it now. You don’t
have to tell yourself that you must bush daily in order to avoid having no
teeth in old age or extreme pain or ugly teeth or huge repair bills or even
heart attack, stroke, diabetes, respiratory diseases,
and premature/underweight babies. Living The Simple
http://www.perio.org/consumer/proto2/healthygums.htm Financial Life is
The Simple Financial Life is all about like brushing your
understanding and practicing the FIVE actions for teeth.
financial freedom: Goals, Strategy, Patience,
Protection and Enjoyment. In this book, we quantify goals—making
them measurable and specific. Once you know where you are going, you
can implement the best strategy to get there.
You will make an investment policy so you don’t get confused in
hard times. You then work your plan by creating a spending plan that
matches your goals. Your simplify all your transactions. In time, you get
everything you want. Learn what real financial protection is all about—
managing the risk-reward balance beam. Finally, by adopting The
Simple Financial Life, you can relax and enjoy your money. Learn

ian books 12
when NOT to tinker with the important aspects of your life. Complexity
increases the chances that something will go wrong.
It is my goal to help you learn from the examples of
independents I work with. I have tried to incorporate their ways into this
explanation of The Simple Financial Life in the first five chapters.
In my work helping people save on the financial services they
need, I have developed a series called The Insider’s Guides for each
financial product and service. You can redirect the money you spend
NOW to products that cost less.
In my previous employments, I compared hundreds of products
and companies for use in my sales programs. In addition, I have
interviewed many colleagues who work or worked in the industry. They
are the Insiders who helped me find the best deals in each area of
financial needs. These Guides are available in the companion workbook
called The Insiders’ Guides to Buying Discount Financial Services: Buy
Direct and Save Up to $3,000 Every Year or you can buy them
individually at http://www.theinsidersguides.com/index.html. I update these
Guides every month so you have the latest information and ‘best values.’
You can save $3,000 every year on the products and services you already
use. You might not need them. Members redirect the savings to their
Wealth Reserve. Over time they accumulate to $1 to $2 million.
For example, most young families need life insurance to protect
their futures. You may not need it and yet still pay for The Insiders’
it. Agents are NOT going to tell you when you don’t Guides to Buying
need it. They are NOT going to tell you where to buy Discount
the least expensive policy because they can’t live on Financial
Services
the low commissions paid by those insurers.
Our Insider clarifies how to determine what you really need and
where to buy it. Using The Insider’s Guide to Life Insurance, you buy
only what you need and pay the least commission. You buy directly from
the insurer. One insurer is rated the same as MetLife without the
overhead. Your family will receive the same benefit—a check in US
dollars about a month later, tax free.
Commissions can be 150% of your first year premium. Member
Jeff bought a MetLife $300,000 30-year term policy because the agent
said it was best for him. Jeff was charged $983 for the same $300,000
30-year term policy that SBLI provided for $384. The financial strength
ratings are both A+ and their underwriting requirements are similar.
The difference in cost, $599, over 30 years is $17,970. If
invested, this difference can add $175,000 to Jeff’s assets when he needs
ian books 13
them—after age 65. Jeff changed policies. NOW, if he dies, his family
will receive $300,000 plus the $175,000 or more since Jeff’s parents
both lived to be 82.
It has been my experience that most people would have chosen
SBLI—a direct writer—if their agent could offer it. Most people do not
need a sales person to buy insurance or any other financial product or
service. All you need is clear information from someone who has
no vested interest in the products. You need an unbiased advisor.
We are your Unbiased Advisor.
We have no interest in which company or products you buy.
We do not receive commissions or fees from any of the firms listed in
The Guides. I think it is time that the secrets of how and where industry
insiders buy what they need for their own accounts comes out.
This is my goal: I want you to save at least $3,000 every year on
your financials. The financial industry has changed. Now you can buy
direct and save. I want you to invest at least $3,000 a year in your
future. You could add $939,423 to your Wealth Reserve. You can build
The Simple Financial Life and gain financial freedom for life.
I know you are feeling that this might be too complicated—NOT
the simple financial life at all. However, I put the book together so that
you can read each part on its own, as you need it.
Part 1. I cover the 5 actions that all financially independent
people practice.
Part 2. I explain The Simple Financial Life concept. You build
your Wealth Reserve so you can “self-insure” and “What we really
“self-fund” some of your risks and needs in life. need is Lifestyle
I want you to look at insurance differently. A insurance.”
wise insurance executive taught me that what we
really need is lifestyle ‘insurance.’ People have REAL peace of mind
when they have the assurance of receiving increasing income, for life.
They feel like a “million bucks” when they receive income from many
“assets that grow by themselves.” That means owning many types of
assets so that if one fails; your family does not.
Sales people must sell the products that their firms pick to offer.
They have a huge conflict of interest in solving your financial problems.
If they want to succeed, they must sell whatever their employers offer.
The Insiders’ Guides provide you with an Unbiased Advisor point
of view. The last two years—2008-2009—have proven that you are
better off without the assistance of the “professionals.”

ian books 14
Relax! The Simple Financial Life is the way to financial freedom.

ian books 15
Resources
Compounding
www.Moneychimp.com/calculator/compound_interest_calculator.htmr
Amateur stock pickers www.Aaii.com/
Mutual fund costs www.Sec.gov/answers/mffees.htm
Mutual fund fees www.Sec.gov/investor/tools/mfcc/mfcc-int.htm
Mutual fund investing www.Sec.gov/answers/mutfund.htm
Government study http://www.cbo.gov/
MF, ETF, Stock information www.Finance.yahoo.com/
Details on Roth IRA www.Rothira.com/
Details on Roth 401k www.Bankrate.com/brm/news/sav/20050518a1.asp
Details on IRAs www.Irahelp.com/
Glossary www.Investorwords.com/
Greatest investor Buffett’s comments: www.Berkshirehathaway.com/

You can obtain current Guide links at TheInsidersGuides.com

Vehicle Insurance $6,000 over 10 years


Homeowner’s Insurance $2,000 over 10 years
Life Insurance $20,000 over 20 years
Lawsuit Insurance $3,000 over 10 years
Health Insurance $5,000 over 10 years
Disability Insurance $5,000 over 10 years
Long Term Care $40,000 over 20 years
Education Funding $20,000 over 18 years
Retirement Spending $1,000s over 30 years
Banking $30,000 over 20 years
Annuities $20,000 over 20 years
Mutual Funds/Securities $3,000 each year
Spending Plan Reach every goal
Vehicle Purchase $10,000 per vehicle
Mortgage Purchase $3,000 per contract
Wealth Reserve $1,000,000 in 31 years
Wealth Transfer $20,000 in 10 years
What NOT to buy 101 products to avoid
Living Insurance $120,000 over 20 years
Survivors You can make a new life
Self-insurance $20,000 over 20 years
Self-Funded ‘bank’ $125,000 in 15 years
Business $30,000 in 10 years
Women It is your life
ian books 16
Learning to invest; not speculate
Books new and used: www.Amazon.com

1. The Millionaire Next Door: The Surprising Secrets of America's Wealthy,


Thomas Stanley, William Danko
2. The Wealthy Barber, David Chilton
3. Common Sense on Mutual Funds: New Imperatives for the Intelligent
Investor, John C Bogle
4. A Random Walk Down Wall Street, Burton Malkiel.
5. Stocks for the Long Run: The Definitive Guide to Financial Market Returns
and Long-Term Investment Strategies, Jeremy J. Siegel, Donald G. Coxe
6. Everything You’ve Heard About Investing is Wrong!, William Gross
7. Psychology and the Stock Market, David Dreman
8. Fooled by Randomness, Nassim Teleb
9. Against the Gods: The Remarkable Story of Risk, Peter L Bernstein
10. Winning with Index Mutual Funds: How to beat Wall Street at its own game,
Jerry Tweddell & Jack Pierce
11. The Only Guide to a Winning Investment Strategy You’ll Ever Need, Larry
Swedroe
12. One Up on Wall Street, Peter Lynch
13. Ordinary People, Extraordinary Wealth, Ric Edelman
14. The Intelligent Investor, Benjamin Graham, Warren E. Buffett (Preface)
15. Eight Steps to Seven Figures, Charles B. Carlson
16. Bogle on Mutual Funds, John C. Bogle
17. Earn More (Sleep Better): The Index Fund Solution, Richard E. Evans
18. Perfectly Legal: The Secret Campaign to Rig Our Tax System to Benefit the
Super Rich - and Cheat Everybody Else, David Cay Johnston
19. Maximize Your IRA, Neil Downing
20. Index Your Way to Investment Success, Walter R. Good, Roy W. Hermansen
21. Tricks of the Trade: An Insider’s Guide to Using a Stockbroker, Mark
Dempsey
22. Mobius on Emerging Markets, Mark Mobius
23. 25 Myths You've Got to Avoid--If You Want to Manage Your Money Right:
The New Rules for Financial Success, Jonathan Clements
24. Investment Policy: How to Win the Loser’s Game, Charles D. Ellis
25. The Insiders’ Guides to Buying Discount Financial Services: Buy Direct and
Save Up to $3,000 Every Year Dan Keppel

ian books 17
Acknowledgements
All of the Insiders’ Guides are written and updated with the help of my
friends and colleagues. Most are industry professionals who work or
have worked in the financial services industry. Many financial services
firms have discarded their fiduciary trust role and are targeting you in
their “asset gathering” plans. Most firms are focused on consolidating
their share of the global market, not on helping you.
We think most advisers tell clients they are unbiased product
evaluators, but the fact is that many of them have little choice in which
products to sell. Products are chosen by the management based on
company profitability. Most brokers are given ample incentive to push
specific products, no matter what they say. Investmentnews.com 4/3/9.
“Many insurers have set up bogus reinsurance companies and other
arrangements that reward top producers who are given equity stakes in
these third-party entities,” according to an insurer's attorney. “Insurance
companies’ higher payouts for proprietary products are not as well
documented as the use of proprietary funds by the major brokers,” a
securities attorney admitted. Investmentnews.com 3/5/7
We are providing this information because we are unhappy with
our industry’s role in helping to educate their fellow citizens. We are
unhappy that there is no basic financial education (beyond balancing
your checkbook) in our schools. Consequently, those who need help the
most are being left further behind.

The disturbing facts we see:

86% of high school seniors think that the best long term growth
investment is a savings account. (Jump Start 2006)

The top 10% of American earners capture over 40% of the nation’s
income. First time in 65 years! (NYTimes 6/25/6)

52% of Americans don’t know how much they need to live on. 36%
have not saved for retirement. 57% have a retirement account BUT the
median amount held is only $2,000. (BLS.gov)

ian books 18
We want to be your “Unbiased Advisor.” I edit a FREE weekly Alert to
keep you up to date on changes in the industry that effect your financial
products and services. Send your Email address, questions or comments
to Editor@TheInsiderSGuides.com

Our approach: You can do it yourself and save!

We believe it is more fun to have financial independence than


live paycheck to paycheck. You need to have control over your
financial life to be happy. You can’t rely on those that sell
financial services to give you the best advice for your life. They can’t
make a living selling no-load low-fee products. The Simple Financial
Life puts you in control. You buy only the financial services you need,
when you need them, using information from our Insiders to save. You
invest this savings in the same way professionals do—a diversified
mutual fund that beats 88% of all retail funds. (BusinessWeek 11/03) You
create your own Wealth Reserve, a self-insuring and self-financing fund
that protects your lifestyle, now and later, when you really need it. Set it
and forget it.
We feel that most people would be better off if they used the
same low-cost products and services that we do. By using our Insider
information about products and services, you can buy the best products
and save. Most of the products and companies industry professionals use
carry the highest financial ratings. These companies’ products are a
better value—low cost/high quality—because they are not advertised
and do not pay high fees or commissions. In other words, we usually
can’t sell them but we buy them for ourselves.
For instance, most mutual funds have high expenses, high
commissions and don’t provide returns that consistently beat their
benchmarks. If you buy mutual funds from a bank, brokerage or inside
your employer’s 401K plan, you are usually forced to buy the ones
which benefit the seller most.
We believe that the industry makes investing for your goals too
complicated and costly. Our members, those who use our Guides,
became financially successful by following the “tricks of the trade”
provided by our Insiders. Some of our members have provided important
experiences that I share with every member in the weekly Alert. Most
members have uncovered $3,000 or more per year in wasted fees,
premiums, loads, charges, etc by using our Guides. They have invested

ian books 19
these savings and are on the way to reaching their goals. Our Insiders
provide Email support as they can.
We don’t sell products. Our Insiders are less biased. For
instance, would you be better off buying that new improved indexed
annuity your banker/broker/agent wants to sell you? Sellers who make
their living selling products will never tell you about low-cost annuities
or better alternatives. We think you need to know about low-cost
alternatives. You need to compare products with the same benefits. For
instance, if you decide to buy an annuity, buy the low-cost one directly
from the insurer and skip the commission and hidden fees.
I edit The Guides. I worked for a Wall Street securities firm and
two banks over the last 20 years. I managed a life insurance entity. I saw
that brokers/agents/bankers sell only the products that were profitable
for the firms. It is not in their interest to tell you about better
alternatives. They can’t sell products with low costs, for instance, even if
they are the best alternatives for you. That’s correct! Brokers can’t offer
one of the most popular mutual fund. Agents can’t offer one of the least
expensive life insurance plans for most people. Bankers can’t provide
the best rates.

The financial services industry is going through commoditization.

Your accounts and your trust are being bought and sold almost everyday.
Banks, insurers and mutual funds are trying to combine in a way that
they can control larger pools of your money. These new global
competitors trade your accounts to gain world dominance. Bond guru,
Bill Gross calls them the “capital market vigilantes.” Consequently, most
of the financial industry operates for its best interests, not yours. For
investors, fund managers have become the new robber barons, adding
more volume and fees while performance, compared to their
benchmarks, continues to fall. We believe you do not need to be
mistreated anymore. There is a better way!
To succeed, independent people have to learn to take advantage
of better information and access to the products and services of
independent companies. We believe in the advice Benjamin Graham,
legendary investor, gave to investors: buy financial products like you
buy “groceries, not perfume.” Understand what you are getting for your
money. You can obtain quality products at low cost by seeking out
providers who focus their attention on you—the customer—instead of
their sales force. Every financially-independent person became free by
ian books 20
questioning what they receive for their money. Most learned the hard
way that you must understand the VALUE of what you buy, not just the
price. We want to encourage this attitude by helping you discover these
“customer-centered” financial services providers. We are your coaches.
"Customer-focused" mutual funds, brokers, bankers, insurers,
and lenders have learned to listen to you—the customer—not their own
sales hype. We think they will be the firms that will be responsive to you
now and in the future when you need them. Customer-centered firms are
well-established and ‘young-at-heart’ even though they are just as old
and financially strong as the companies you’ve heard about. The
difference is they don’t make you pay for their million-dollar sales
persons, sales contests, kick-backs, rebates, and expensive advertising.
They pass these savings on to you.
Customer-oriented manufacturers have found ways to give you
what you want, when you want it, the way you want it. The 21st Century
way to buy is to buy DIRECT: Like Dell.com, customer-focused
providers offer individuals a “custom-built” program, directly, at lower
cost. Even complicated buys, like diamonds, can be accomplished this
way. BlueNile.com lets you “build your own engagement ring,” and buy
DIRECT. A financial product is not any more sophisticated than a
computer or expensive as a diamond. Consider how discount brokerage
firms have made it easy for anyone to research, buy and manage their
stocks, bonds and funds. Our members have learned to buy banking,
insurance, mortgages, credit, and almost every product in the same way.
All the companies that Network members use are top quality with high
ratings.
It is our goal that you will buy only the products and services
you need and use the savings to invest for the future. Our wish for you is
to become financially independent like Susan and Fred, and now their
daughter Natalie. I formed our Network to help each other find the best
way to reach our goals. The current industry business models are broken.
We can do it ourselves with a little help. No one knows our dreams
better than we do.
Your ideas and suggestions are important to all of us as Network
members: Email me at editor@TheInsiderSGuides.com.

Now relax and enjoy The Simple Financial Life!

ian books 21
Index

amazon.com..........................17 goals......................................12
America.................................17 Good, Walter R.....................17
Aristotle..................................7 Graham, Benjamin................17
assets that grow by themselves. Gross, William......................17
.........................................8, 9 Hermansen, Roy W...............17
Bankrate................................16 investment policy..................12
Bernstein, Peter L..................17 IRA........................................17
Bogle, John.....................12, 17 Irahelp.com...........................16
brushing your teeth...............12 Johnston, David Cay.............17
Buffett, Warren..........11, 16, 17 Lexus.....................................11
BusinessWeek.......................10 lifestyle................................5, 6
car insurance...........................8 Lynch, Peter..........................17
Carlson, Charles B................17 Malkiel, Burton.....................17
catastrophic.............................8 MetLife.................................13
child......................................12 Millionaire Next Door..........17
Chilton, David.......................17 Mobius, Mark........................17
Clements, Jonathan...............17 Money.................................6, 7
commission...........................13 Pierce, Jack...........................17
compounding..........................9 protect.....................................6
Coxe, Donald G....................17 SBLI......................................13
Danko, William.....................17 Self-Funded ‘bank’...............16
discount...................................7 Self-insurance.......................16
Downing, Neil.......................17 Siegel, Jeremy J....................17
Dreman, David......................17 SIMPLE..................................1
Edelman, Ric.........................17 Simple, Easy and Wise Plan....8
Einstein, Albert.......................9 snoring................................5, 8
Ellis, Charles D.....................17 Stanley, Thomas J.................17
enjoy......................................12 strategy..................................12
ETF.......................................16 Swedroe, Larry......................17
Evans, Richard E...................17 Teleb, Nassim........................17
FICO.....................................10 Tweddell, Jerry......................17
financial strength...................13 Wall Street.............................17

ian books 22
To purchase a copy of

The Simple Financial Life


go to

Amazon
TheInsidersGuides.com

The Simple Financial Life

A Will. The court might give guardianship to someone you don’t


like.
Power of Attorney. If you are in an accident, you need someone to
fight for you.
Financial Plan. If you have a dream, you need a plan to get there.
401K Retirement. Employer gives you money and Uncle Sam
waits for his.
Roth IRA. The Best: your savings are compounded and tax-FREE.
Self-insurance Fund. Manage all your risks for less.
Let the Insiders save you money. TheInsidersGuides.com.

ian books 23
The Author

Dan Keppel has been helping people find financial services that fit their
lifestyles since working in a securities firm, an insurer, two banks and
his own advisory firm. His book, The Insiders’ Guides to Buying
Discount Financial Services: Buy Direct and Save $3,000 Every Year,
shows you how, what and where to buy financial products like industry
insiders do—directly from the highest rated companies. He edits
TheInsidersGuides.com and is an adjunct at a local college. He lives in
Montclair, NJ with his wife, daughter and two cats, Anu and Katze.

New: Wealth Without Wall Street due June 18, 2009 at Amazon.com

ian books 24