April 2, 2025 • 33 mins
April is Financial Literacy Month, and to help us celebrate we brought in a returning guest, Paul Merriman. Paul has been on the show before to discuss investment portfolios, but today he talks with us about some extraordinary strides he's making as a financial literacy advocate through his nonprofit, The Merriman Financial Education Foundation. We also share some of our favorite financial literacy resources.
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RESOURCES MENTIONED ON THE SHOW:
Merriman Financial Literacy Program at Western Washington University
The John C. Bogle Center for Financial Literacy
‘Catching Up to FI’ Episodes:
We're Talking Millions! Part 1 | Paul Merriman | 008
We're Talking Millions! Part 2 | Paul Merriman | 009
Celebrating Financial Literacy Month with Next Gen Personal Finance | Tim Ranzetta | 072
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:01):
when I saw this number, I laughed.
I saw a study that showed that peoplewho get financially literate when they
are at the college level, it has theimpact of a hundred thousand dollars.
In additional money in their life, ahundred thousand dollars that is peanuts.
(00:27):
If you look at all of the great decisionswe can make and how coming to a fork
in the road and taking the wrong forkin the road leads to huge differences.
(01:09):
Welcome back to Catching Up to FI.
I am your co-host Jackie Cummings Koskiwith my wonderful co-host Bill Yount.
Bill.
How you doing today?
I'm doing great, and we're talkingabout financial education and financial
literacy today because it's financialliteracy month, April, right, Jackie?
Yes.
A lot of people may not know, butApril is financial literacy month.
(01:30):
I have been celebrating thisfor over 10 years and I want
everybody to celebrate with me.
So this financial literacy month isvery, very special because we decided we
wanted to bring on a. A very importantguest that has as much passionate
about financial literacy, probably morethan I do, and that is Paul Merriman.
(01:50):
So Paul, welcome to the show.
Thank you, Jackie.
It's great to be here.
Yeah, well we brought you back.
We had a show with you andRick Ferry that was so awesome.
We love a great spiriteddebate from smart people.
So one of the things that reallyinterested us, and this came up at the
end of it because we really love whatyou were doing with financial literacy.
(02:13):
You have a nonprofit.
So I'd like to start out,tell us a little more about.
Your nonprofit inside of the universityand brag about it a little bit.
And you also have a great storythat kinda leads us into this and
'cause we want to avoid something andyou're helping us avoid something.
Can you tell us that story?
(02:34):
Well, one of the things I'm alwaysconcerned about with the young people
that we're educating is they willaccumulate a fair amount of money, and
all of a sudden that fair amount of moneylooks like a commission to somebody.
Who might be in the business ofextracting a part of your money?
Now, I was shocked.
(02:56):
This goes back to probably19 well, 19 83, 84.
And I had, was in the process of buildingmy investment advisory company and I had
an opportunity to join one of the peoplewho worked for a national organization
that sold limited partnerships.
(03:17):
And somebody had asked meif I could check them out.
I. And I think there were probablymust have been 400 or so of
these salespeople or consultants,however they positioned themselves.
But they were there to learnfrom the head of the firm
whose products they were using.
(03:38):
And selling.
And we were in a theater and thelights went down and spotlight
came down on the gentleman whowas the head of this company.
And as I turned to look, I sawhim walking down the center aisle.
He was wearing a white smock,a stethoscope around his
(04:00):
neck, and he was carrying.
An elephant gun.
I mean, it's a big gun, and he walkedproudly up the stairs onto the stage and
turned around and looked at the audienceand said, today I'm going to teach
you to take down the big ones doctors.
(04:25):
Wow.
and then he went on to spend themorning talking about how to sell the
psychological end of closing a saleparticularly with people who have a lot
of wealth and which, which includes, whichincludes a saying a very complimentary
(04:49):
things to the doctor because they liketo be perceived as being intelligent
and understanding so many things inthe world when in fact we know that.
Many of them, including myself.
I know the area I know really well, butyou wouldn't come to me for a whole lot
else than what I know about and yet youcan feed our egos and if you feed our
(05:11):
egos, they know we're more likely to writethe check to be part of whatever that.
Tax write off was going to be, soanyway, I want to prepare these kids
for that time when there'll be peoplewho will crawl across crushed glass to
get to them because there's money tobe made if they can just talk you into
(05:35):
doing something that they are selling.
Wow.
And to me that is probably thankyou for bringing that one up, bill.
That is probably one ofthe most important things.
It's like.
When you're young, you know, so whetherit's your kids, whether it's yourself
as a late starter, that there's peopletrying to target you, and what's the best
defense to that is educating yourself.
(05:58):
Yeah.
And the problem is that we all haveis understanding how to evaluate the
person who is our first mentor or oursecond mentor the teacher in our life.
Who made that difference.
And unfortunately, in many cases it mayeven be a well-meaning mentor who is
(06:19):
simply trying to help you get started.
And it's not unusual for older people tothink it's a good idea for young people
to make their mistakes on their own.
They gotta learn from their mistakes.
No, I mean, Warren Buffet said it'sso much better off to learn on other
people's mistakes than to have tomake them, because the cost of those
mistakes can be so unbelievably high.
(06:44):
Yeah, so true.
So true.
so this is one of your early thoughtsof how important financial literacy was.
You started this nonprofitinside the university.
I wanna hear more about that.
Well, we have two nonprofits.
One is outside the universityand part of the money in that.
(07:08):
Foundation also goes to Western,so they're all tied together.
but when we started this recentprogram at Western, the attempt to
make every student who leaves Westernfinancially literate about the.
Really the big importantdecisions they're going to make.
I'm talking financial decisions.
(07:30):
And yet we know it's way more than justabout making good financial decisions.
It's about I. How your life withyour spouse might be if you and both
your spouse are financially literate.
we know that a lot of marriagesfail because at least one of those
people is not financially literateand it causes some big problems.
(07:53):
And so the idea is to get every oneof these kids to come out of there
ready to make the big decisions.
Now, I. Actually, when Isaw this number, I laughed.
I saw a study that showed that peoplewho get financially literate when they
(08:14):
are at the college level, it has theimpact of a hundred thousand dollars.
In additional money in their life, ahundred thousand dollars that is peanuts.
If you look at all of the great decisionswe can make and how coming to a fork
(08:36):
in the road and taking the wrong forkin the road leads to huge differences.
For example, load versus no load.
Half a percent.
Basically, you're paying per year to own.
A load fund is going to translate overa lifetime to over a million dollars.
(08:58):
If you bought load funds for therest of your life, index funds
versus active management, it'sanother million dollar decision.
Market timing versus buyand hold another million.
I mean a hundred thousand is the chumpchange that people are gonna make.
I think literally a financially literateyoung person, I. Has the ability to add
(09:25):
millions of dollars over their lifetime.
And I'm not talking about thisin terms of greed or avarice.
I'm talking about when youmight be able to retire.
I'm talking about if you do retirelater in life, having more to
do the things you want to do.
My wife and I are able to give money awayat, at a percentage of what we have each
(09:51):
year that is so much higher than I everthought we would be able to do because
we did the right things along the way.
So these decisions,they're just so many ways.
Well, as a matter of fact, as I just saidthat I realized there's another big one.
If you are financially literate.
(10:12):
Your children are more likely tobe financially literate because
you become the mentor of sorts.
and I know my kids, if you ask themabout the things they learned when
they were relatively small, theylearned the difference between a
load and a no load fund and an indexfund and an actively managed fund.
(10:32):
It was part of a ride in the car.
Little conversation we would have.
It makes a difference.
And my son, who's now 59, he haslived up to everything that I tried
to teach him and it's paid off.
I think that is such a great point anda lot of our late starters, I think
sometimes they're like, well, it'stoo late for me to course correct.
(10:56):
I just wanna retire on time.
But I let them know and remind them,'cause I learned this myself that.
Everything that you learn, youcan now teach it to your kids
or other people in the youngergeneration that's in your life.
So it can compound and you'recreating a legacy that way.
So thinking about all the things that youtaught your kids, everyone can do that.
(11:19):
Even someone that is just wakingup, just pulling the stuff together,
everything that you're learning,you can share it with your kids or
other young people in your life andit's going to make a difference.
Yeah.
And by the way, Jackie, I thinkit's important to understand
that we, if we start late.
We still have the same decisions to make.
(11:42):
And so from my viewpoint, the personwho's starting late needs to kind of
come to those, all those same forksin the road and make sure what they do
from now on is the right thing to do.
So.
I think it's, it's thesame set of problems for a
21-year-old and a 51-year-old.
(12:03):
They gotta make sure they got lowexpenses, they gotta make sure
they have proper diversification.
All those things are important.
Agreed.
Agreed.
And I wanna make sure I get thename of the university right.
The here is at the uni atWestern Washington University.
They have a founding, a program calledthe Merriman Financial Literacy Program.
(12:27):
And so people have donatedmoney to that program.
and, while my wife and I are financialsupporters, we know it's gonna take
more support than we are able to giveto make sure that this, on a long-term
basis is going to continue to educateevery student who comes through there.
(12:51):
Well, we hope that what you'redoing or have done already with
Western Washington University.
Becomes a model for other universities,for other corporations where people
are onboarded and need to learnthis stuff with their first big boy
paycheck or big girl paycheck, that'swhen the rubber meets the road.
And if you don't get your savingsand investing muscles right from the
(13:13):
beginning you're gonna be a late starter.
Well, I think that's true, bill.
and there's one thing that madea huge difference at Western.
And that is that we discovered anonline course, that can supplement
the other things that we willbe doing with the students.
(13:36):
We have so many things going on.
We have students who arementoring other students.
We have students who are going outto the public schools in the, the
local community to teach young people.
We have did all sortsof programs to try to.
Help people who are asking for helpget rolling in the right direction.
(14:01):
But I grad, I grad is such aphenomenal resource for us.
and I grad.
what it does, it gives usaccess to an online course.
That is being used by hundreds,I think some 700 institutions.
And part of the money that my wife andI have given underwrites the cost of
(14:25):
having I grad for all students at Western.
And not only do they learn allthe, there's a regular course they
can take, it'll take 'em probably30 to 40 hours to complete.
But when they leave Western, theyget to take I grad with them and all
of the updates and things that makeit a current piece of information.
(14:49):
And from my viewpoint, they now havea partner that knows a lot about
them because what I grad does, when Iwent into it, it knows how old I am.
It knows how much money I have now.
It knows about my risk tolerance and,and it knows the things that I need to
(15:10):
know as an 81-year-old on the other hand.
The beauty is if I were 13, I gradwould ask for some information
that that's appropriate.
I mean, it's all legal, but ask forinformation that would let like a
birthdate or what year they were born.
(15:33):
Not the birthdate itself, but what you're,they're born and now all of a sudden.
When they go to a particular topic,it's not the kind of information
that an 81-year-old who's somewhatknowledgeable about the process.
It feeds me an entirely different bunchof information because now it needs
to teach a 13-year-old and I just.
(15:56):
Love that a family, one family couldbe sharing I grad and letting different
people in the family use it so thatthis all of a sudden this student
at Western has got something trulyvaluable to offer to their family.
And one other thing youdo is a bootcamp, right?
(16:19):
Can you tell us about the bootcamp?
Well, bootcamp is the best that wehave to offer at paulmerriman.com.
What we've done at bootcamp iswe've taken what we consider to
be the biggest decisions thatinvestors are going to make.
We don't try to be financial planners.
that's not our expertise.
(16:39):
We are focused oninvestments and there are 10.
Decisions you make in your lifetime thatwe want you to know how we feel about
that decision based on the historicalevidence that we have available.
And we have some 200 plus.
(17:00):
Tables and graphs and charts and differentways to help people understand not only
how investing works, but that informationis being aimed at you, kind of if you're
a low risk investor, if you're a high riskinvestor, if you're somewhere in between.
We show you as best we can.
(17:22):
The historical implications not onlyabout return, return is always important,
but you can never look at return withouthaving a firm understanding about what
that likely risk is that you're going tohave to be able to stay the course with.
So, my hope is that if you have the time,oh, and by the way, on every one of those
(17:43):
forks in the road, we have an article.
A podcast and a video and lots of tables.
So we are there to do whatwe can and it's all free.
And, Paul@paulmerriman.comYou got a question?
I, I get up early in the morningand the first thing I try to
do is get on those questions.
(18:04):
So we are truly here tohelp and it is all free.
Well, that's awesome what you do, becausethere are other organizations that we
should mention because we've had them on.
The show, next Gen Personal Financeis all about teaching high school
teachers so that kids get this.
So teach the teachers andthe students get it too.
So there are so many ways coming fromthe private sector to fix this problem.
(18:30):
Tim Ranta is one of my true heroes.
The man who started.
I can't remember the, the lady he startedit with, but they started NGPF and they
are providing free, I. Curriculum from,I think the sixth or seventh grade
through senior year of high school.
(18:50):
And they, not only is it all free for theteachers, but their teacher development,
their, their personal development programto provide the teachers the information
to be a, a successful teacher in anarea that a lot of these teachers.
They're not risk takers themselves,and so they need to be educated
(19:12):
to what is the right way tolook at all these money topics.
He has a question of the day and whata lot of people don't know, and I don't
know if you, you guys know this, you don'thave to be a teacher to go to ngf.org.
To have access to the question ofthe day or the information on all
(19:36):
the different topics that theyare teaching young people about.
And they strive, they tryto be so current so that it.
Really gets the attention of the students.
they're just an amazing organization andTim does not take a penny of compensation.
I think he worked six days a week andit used to be that it was only his own
(19:58):
money that was driving that organization.
he is just one of my heroes.
Yeah, I, I agree.
I'm very familiar with that organizationand the content they provide and the
support for teachers is outstanding.
And this is like a yearconfessions for me.
But I will confess that when Iwas getting ready for my CFP exam.
(20:20):
If there was something where Ibarely knew the basic, I would go
to ngf.org and I would go to theirYouTube, make sure I had the basic.
The foundation so that I couldlearn all of this stuff and
layer it on top of that platform.
And so they do an outstanding job.
And you're right, they serve morethan just teachers because so
(20:41):
much of their material is public.
So that's yet, so I love the fact thatyou obviously have an amazing nonprofit,
but you also appreciate others in thespace that's trying to do the same
thing, educate people on their finances.
You know, something else that wedo, I would've forgotten about
this, that this hadn't come up.
(21:03):
We have a page of truth tellers.
I know my days are numbered.
I can't do this forever.
I. and at the time that the point that Ican't, the question is, who can you trust?
Now, there are lots of people youcan trust that are not on that
list, but Jim Dawley the work thathe does at the White Coat Investor.
(21:27):
I don't care if you're a doctoror a dentist or not, he just
does some of the best educationalwork that I know on the internet.
The other people that we have there,sometimes they're not well known.
I. 'em, but they put out informationin a way that I really believe
they are going to be able tohelp people be a better investor.
(21:52):
And I don't cover all the estate planningand I don't cover the things that A
CFP would cover, but these people do.
And so I'm also trying to give people,folks that I think will be able to
help them today or in the future.
Jackie is very involved as is NGPF, withsort of political activism in a way,
(22:16):
trying to get this in all the states.
And I want to hear from Jackiehow many states we have required
financial literacy education
Yeah.
You know, I keep up with it.
Well, I'm gonna give our guestsa chance to answer that question.
Do you happen to know Paul,
I think it's 26.
it is?
26. Woo.
You get the prize.
You get the prize.
fact that he hires lobbyists.
(22:38):
To go talk to the people.
If he knows there is a state that'sin the process of considering it,
he is gonna spend the money tomake sure that the story is told.
And I hope you're one ofthose storytellers that
would be wonderful to learn.
Yeah.
Well, the most recentwin was a really big win.
It was the state of California.
(23:00):
They've
been fighting with thatone for a long time,
It takes time.
This is must be frustrating to Tim.
I think California goes live in31, 20, 31, if I'm not mistaken.
the way they do it is they getfour years to get it right.
Right.
'cause you can't have a high school juniornow all of a sudden they gotta take it.
So it's in the implementation phase.
(23:21):
I'm in Ohio, ours got passed in 2021,and we have one more year until we
can say we are fully implemented.
But there's still a lot of work going on.
That's great.
Well he's remarkable.
The process.
I'm going to be speaking this summerat the Garrett Planning Network.
Meeting some of their advisors whocome anyway, and I'm gonna be talking
(23:46):
about the future of financial literacy.
I am so thrilled.
To see what is happening.
We know that investinghas never been easier.
It has never been cheaper.
We've never been as tax efficient.
We've never been as diversified that theunit of return per unit of risk is so
(24:09):
much better today than when I came inThe industry in the mid sixties and the
resources on the internet can be so good.
That's the good news.
The bad news is.
That there's so much terribleinformation on the internet that we've
just gotta make sure we find a way.
(24:32):
To get our useful and I think mostproductive information in the hands
of young investors and it'll makea big difference because if, if I,
whatever I ended up with right now atage 81, if I had the ability to invest
in 1963 when I started investing.
(24:54):
I would have twice as much money todayas I have because the costs were so high
Right.
and we didn't even know about index funds.
We didn't even know aboutthe small cap value factor.
And yeah.
(25:15):
Ages over, over this topic.
And we gotta give a plug for whatthe Bogle Center for Financial
Literacy is also doing boglecenter.netand the Bogle Heads Conference.
They also are very passionate aboutfinancial literacy education, and they
have a conference that we recommend toeverybody, including our late starters.
(25:36):
And then we see parents taking theirkids to Bogle Hills and we see kids.
Taking their parents.
So it's generational educationand the conference is a way to
get really passionate about it.
And you put all these thingstogether and you become an expert
that educates others, right.
Jackie?
That's right.
And we are with this show and duringfinancial literacy month, we are just
(26:00):
going to package together all theseamazing resources that Paul just mentioned
that who's my co-host that, oh, sorry.
That bill just mentioned our great socialmedia maven, Diana, she may have some,
but we are going to put together, likePaul was saying, some great credible
resources that you can use for education.
(26:22):
And Paul, what you were justsaying kind of struck a chord
with me and our late starters.
You were saying when you startedway back in the day, things were
so much more expensive and theinvesting landscape was so different.
And right now.
Is one of the easiest times inhistory to invest in the lowest times.
So for late starters, those are otherbenefits that you have starting now versus
(26:46):
maybe 20 years ago when we wish we did.
We can't go back and change time,but the investing landscape piece
of it has gotten a lot easier.
So that part is probably gonnabe much easier for you today than
what it may have been 20 years ago.
In the earlier you start, the earlieryou can retire, if you get these things
right without making mistakes that weas late starters made and you know.
(27:12):
It, it will make so much of adifference in so many people's lives.
These resources thatwe're putting out there.
Share them.
Share them widely.
Have 'em come listen to catching up tofi, you know, point people in the right
direction when they're ready to listen.
Well, and there are things happening tooin the world, in the 401k world that are.
(27:37):
Absolutely life changers.
The one that is such a wonderful change.
People used to go to work for mostcompanies and they were offered a
chance to be part of the program.
Would you like to join our 401k plan?
and we'll put some money in there tomatch some of the money that you put in.
(27:58):
And it turned out very few peoplesaid yes, because you were about
to take money out of my pocket.
And you're gonna put itwhere I can't spend it.
Look, I just got outta collegeor just got outta high school.
I wanna spend the money I'm gettingand very few people, less than 30% were
taking advantage of those early years.
(28:20):
Now they have an opt out programbasically so that when you go to
work for the company, you have toactually tell the company, no, I do
not want to have that money taken out.
83 or or 85% are now in the program fromday one, because they're not opting out.
(28:42):
They're learning to live on less.
And that is so big.
That is a life changerfor millions of people.
Well, I mean, it's important.
They also have.
Auto escalate too.
as you earn more, you save more,you invest more, it grows more.
And the reason we need to dothis is because we live longer.
(29:03):
People used to live on social security.
and there's about 40% of the nationstill does live on just social security.
But we don't have to.
We can't put our cash in the mattress.
We have to put our cash to work for usso we don't have to work as hard and
we can work a shorter amount of time.
Exactly.
That's what it's all about.
And I think all this education thatyou're doing and, just so many folks
(29:28):
that are focused now, you and others.
Are in the business also to build afollowing and, hopefully that that
means that it is a business that youcan rely on to be here for decades.
I mean, wouldn't that begreat if it all worked?
that's the plan.
That's the plan.
We're, we're working on a milliondownloads and more and we should
(29:49):
say we're recording this the dayafter our two year anniversary.
February 19th, 2023, the first episodeof catching up to FI drops, so happy.
By one day to catch the Amplify
and many more years to go.
Jackie, any, any final thoughtson this financial literacy month?
(30:10):
I don't have anything otherthan, I want people to know
that, to the extent that they.
Look to us as one of thosepublic educators that it's gonna
take some work on your part.
It's going to take, I'm guessingyou really have gotta put aside.
(30:31):
At at least 20 hours of reading articles,listening to podcasts, do things that
take you deep enough that you reallycan walk away and say, I get it.
Because when you say, I get it,you are probably at least close
to being able to stay the course.
(30:52):
Because at the end of the day, if youcan't stay the course, you don't get it.
So you gotta, you got, you gotta take thecourse and you've gotta stay the course.
Yeah, and I think they canobviously spread that out.
And, you know, you mentioned 20 hours,over, I think it took me over a year to
start putting all the pieces together.
We hope that Catching up to FI willbe a part of your learning process.
(31:15):
We're gonna drop Paul's nonprofit.
We're gonna drop all of these otherresources that we just talked about,
because we know we're not the onlyvoices, but we hope to continue
to be a part of your journey.
Financial literacy is so important,not just for you, but also for the next
generation that's coming behind you.
So this was so helpful, Paul, andthank you one for what you're doing.
(31:39):
Thank you for sharing with us whatfinancial literacy means to you
and how you're making an impact.
It really does make a difference.
So we are gonna enjoy the rest offinancial literacy month and we will catch
you next time on catching up to five.
Thank you both.
All the best to you and toyour viewers and listeners.
(32:00):
All
Paul.
See you soon, my
All right?
All right?
See you in San Antonio.
Yes.
Bye guys.
See you next week.
when I saw this number, I laughed.
I saw a study that showed that peoplewho get financially literate when they
are at the college level, it has theimpact of a hundred thousand dollars.
In additional money in their life, ahundred thousand dollars that is peanuts.
(00:27):
If you look at all of the great decisionswe can make and how coming to a fork
in the road and taking the wrong forkin the road leads to huge differences.
(01:09):
Welcome back to Catching Up to FI.
I am your co-host Jackie Cummings Koskiwith my wonderful co-host Bill Yount.
Bill.
How you doing today?
I'm doing great, and we're talkingabout financial education and financial
literacy today because it's financialliteracy month, April, right, Jackie?
Yes.
A lot of people may not know, butApril is financial literacy month.
(01:30):
I have been celebrating thisfor over 10 years and I want
everybody to celebrate with me.
So this financial literacy month isvery, very special because we decided we
wanted to bring on a. A very importantguest that has as much passionate
about financial literacy, probably morethan I do, and that is Paul Merriman.
(01:50):
So Paul, welcome to the show.
Thank you, Jackie.
It's great to be here.
Yeah, well we brought you back.
We had a show with you andRick Ferry that was so awesome.
We love a great spiriteddebate from smart people.
So one of the things that reallyinterested us, and this came up at the
end of it because we really love whatyou were doing with financial literacy.
(02:13):
You have a nonprofit.
So I'd like to start out,tell us a little more about.
Your nonprofit inside of the universityand brag about it a little bit.
And you also have a great storythat kinda leads us into this and
'cause we want to avoid something andyou're helping us avoid something.
Can you tell us that story?
(02:34):
Well, one of the things I'm alwaysconcerned about with the young people
that we're educating is they willaccumulate a fair amount of money, and
all of a sudden that fair amount of moneylooks like a commission to somebody.
Who might be in the business ofextracting a part of your money?
Now, I was shocked.
(02:56):
This goes back to probably19 well, 19 83, 84.
And I had, was in the process of buildingmy investment advisory company and I had
an opportunity to join one of the peoplewho worked for a national organization
that sold limited partnerships.
(03:17):
And somebody had asked meif I could check them out.
I. And I think there were probablymust have been 400 or so of
these salespeople or consultants,however they positioned themselves.
But they were there to learnfrom the head of the firm
whose products they were using.
(03:38):
And selling.
And we were in a theater and thelights went down and spotlight
came down on the gentleman whowas the head of this company.
And as I turned to look, I sawhim walking down the center aisle.
He was wearing a white smock,a stethoscope around his
(04:00):
neck, and he was carrying.
An elephant gun.
I mean, it's a big gun, and he walkedproudly up the stairs onto the stage and
turned around and looked at the audienceand said, today I'm going to teach
you to take down the big ones doctors.
(04:25):
Wow.
and then he went on to spend themorning talking about how to sell the
psychological end of closing a saleparticularly with people who have a lot
of wealth and which, which includes, whichincludes a saying a very complimentary
(04:49):
things to the doctor because they liketo be perceived as being intelligent
and understanding so many things inthe world when in fact we know that.
Many of them, including myself.
I know the area I know really well, butyou wouldn't come to me for a whole lot
else than what I know about and yet youcan feed our egos and if you feed our
(05:11):
egos, they know we're more likely to writethe check to be part of whatever that.
Tax write off was going to be, soanyway, I want to prepare these kids
for that time when there'll be peoplewho will crawl across crushed glass to
get to them because there's money tobe made if they can just talk you into
(05:35):
doing something that they are selling.
Wow.
And to me that is probably thankyou for bringing that one up, bill.
That is probably one ofthe most important things.
It's like.
When you're young, you know, so whetherit's your kids, whether it's yourself
as a late starter, that there's peopletrying to target you, and what's the best
defense to that is educating yourself.
(05:58):
Yeah.
And the problem is that we all haveis understanding how to evaluate the
person who is our first mentor or oursecond mentor the teacher in our life.
Who made that difference.
And unfortunately, in many cases it mayeven be a well-meaning mentor who is
(06:19):
simply trying to help you get started.
And it's not unusual for older people tothink it's a good idea for young people
to make their mistakes on their own.
They gotta learn from their mistakes.
No, I mean, Warren Buffet said it'sso much better off to learn on other
people's mistakes than to have tomake them, because the cost of those
mistakes can be so unbelievably high.
(06:44):
Yeah, so true.
So true.
so this is one of your early thoughtsof how important financial literacy was.
You started this nonprofitinside the university.
I wanna hear more about that.
Well, we have two nonprofits.
One is outside the universityand part of the money in that.
(07:08):
Foundation also goes to Western,so they're all tied together.
but when we started this recentprogram at Western, the attempt to
make every student who leaves Westernfinancially literate about the.
Really the big importantdecisions they're going to make.
I'm talking financial decisions.
(07:30):
And yet we know it's way more than justabout making good financial decisions.
It's about I. How your life withyour spouse might be if you and both
your spouse are financially literate.
we know that a lot of marriagesfail because at least one of those
people is not financially literateand it causes some big problems.
(07:53):
And so the idea is to get every oneof these kids to come out of there
ready to make the big decisions.
Now, I. Actually, when Isaw this number, I laughed.
I saw a study that showed that peoplewho get financially literate when they
(08:14):
are at the college level, it has theimpact of a hundred thousand dollars.
In additional money in their life, ahundred thousand dollars that is peanuts.
If you look at all of the great decisionswe can make and how coming to a fork
(08:36):
in the road and taking the wrong forkin the road leads to huge differences.
For example, load versus no load.
Half a percent.
Basically, you're paying per year to own.
A load fund is going to translate overa lifetime to over a million dollars.
(08:58):
If you bought load funds for therest of your life, index funds
versus active management, it'sanother million dollar decision.
Market timing versus buyand hold another million.
I mean a hundred thousand is the chumpchange that people are gonna make.
I think literally a financially literateyoung person, I. Has the ability to add
(09:25):
millions of dollars over their lifetime.
And I'm not talking about thisin terms of greed or avarice.
I'm talking about when youmight be able to retire.
I'm talking about if you do retirelater in life, having more to
do the things you want to do.
My wife and I are able to give money awayat, at a percentage of what we have each
(09:51):
year that is so much higher than I everthought we would be able to do because
we did the right things along the way.
So these decisions,they're just so many ways.
Well, as a matter of fact, as I just saidthat I realized there's another big one.
If you are financially literate.
(10:12):
Your children are more likely tobe financially literate because
you become the mentor of sorts.
and I know my kids, if you ask themabout the things they learned when
they were relatively small, theylearned the difference between a
load and a no load fund and an indexfund and an actively managed fund.
(10:32):
It was part of a ride in the car.
Little conversation we would have.
It makes a difference.
And my son, who's now 59, he haslived up to everything that I tried
to teach him and it's paid off.
I think that is such a great point anda lot of our late starters, I think
sometimes they're like, well, it'stoo late for me to course correct.
(10:56):
I just wanna retire on time.
But I let them know and remind them,'cause I learned this myself that.
Everything that you learn, youcan now teach it to your kids
or other people in the youngergeneration that's in your life.
So it can compound and you'recreating a legacy that way.
So thinking about all the things that youtaught your kids, everyone can do that.
(11:19):
Even someone that is just wakingup, just pulling the stuff together,
everything that you're learning,you can share it with your kids or
other young people in your life andit's going to make a difference.
Yeah.
And by the way, Jackie, I thinkit's important to understand
that we, if we start late.
We still have the same decisions to make.
(11:42):
And so from my viewpoint, the personwho's starting late needs to kind of
come to those, all those same forksin the road and make sure what they do
from now on is the right thing to do.
So.
I think it's, it's thesame set of problems for a
21-year-old and a 51-year-old.
(12:03):
They gotta make sure they got lowexpenses, they gotta make sure
they have proper diversification.
All those things are important.
Agreed.
Agreed.
And I wanna make sure I get thename of the university right.
The here is at the uni atWestern Washington University.
They have a founding, a program calledthe Merriman Financial Literacy Program.
(12:27):
And so people have donatedmoney to that program.
and, while my wife and I are financialsupporters, we know it's gonna take
more support than we are able to giveto make sure that this, on a long-term
basis is going to continue to educateevery student who comes through there.
(12:51):
Well, we hope that what you'redoing or have done already with
Western Washington University.
Becomes a model for other universities,for other corporations where people
are onboarded and need to learnthis stuff with their first big boy
paycheck or big girl paycheck, that'swhen the rubber meets the road.
And if you don't get your savingsand investing muscles right from the
(13:13):
beginning you're gonna be a late starter.
Well, I think that's true, bill.
and there's one thing that madea huge difference at Western.
And that is that we discovered anonline course, that can supplement
the other things that we willbe doing with the students.
(13:36):
We have so many things going on.
We have students who arementoring other students.
We have students who are going outto the public schools in the, the
local community to teach young people.
We have did all sortsof programs to try to.
Help people who are asking for helpget rolling in the right direction.
(14:01):
But I grad, I grad is such aphenomenal resource for us.
and I grad.
what it does, it gives usaccess to an online course.
That is being used by hundreds,I think some 700 institutions.
And part of the money that my wife andI have given underwrites the cost of
(14:25):
having I grad for all students at Western.
And not only do they learn allthe, there's a regular course they
can take, it'll take 'em probably30 to 40 hours to complete.
But when they leave Western, theyget to take I grad with them and all
of the updates and things that makeit a current piece of information.
(14:49):
And from my viewpoint, they now havea partner that knows a lot about
them because what I grad does, when Iwent into it, it knows how old I am.
It knows how much money I have now.
It knows about my risk tolerance and,and it knows the things that I need to
(15:10):
know as an 81-year-old on the other hand.
The beauty is if I were 13, I gradwould ask for some information
that that's appropriate.
I mean, it's all legal, but ask forinformation that would let like a
birthdate or what year they were born.
(15:33):
Not the birthdate itself, but what you're,they're born and now all of a sudden.
When they go to a particular topic,it's not the kind of information
that an 81-year-old who's somewhatknowledgeable about the process.
It feeds me an entirely different bunchof information because now it needs
to teach a 13-year-old and I just.
(15:56):
Love that a family, one family couldbe sharing I grad and letting different
people in the family use it so thatthis all of a sudden this student
at Western has got something trulyvaluable to offer to their family.
And one other thing youdo is a bootcamp, right?
(16:19):
Can you tell us about the bootcamp?
Well, bootcamp is the best that wehave to offer at paulmerriman.com.
What we've done at bootcamp iswe've taken what we consider to
be the biggest decisions thatinvestors are going to make.
We don't try to be financial planners.
that's not our expertise.
(16:39):
We are focused oninvestments and there are 10.
Decisions you make in your lifetime thatwe want you to know how we feel about
that decision based on the historicalevidence that we have available.
And we have some 200 plus.
(17:00):
Tables and graphs and charts and differentways to help people understand not only
how investing works, but that informationis being aimed at you, kind of if you're
a low risk investor, if you're a high riskinvestor, if you're somewhere in between.
We show you as best we can.
(17:22):
The historical implications not onlyabout return, return is always important,
but you can never look at return withouthaving a firm understanding about what
that likely risk is that you're going tohave to be able to stay the course with.
So, my hope is that if you have the time,oh, and by the way, on every one of those
(17:43):
forks in the road, we have an article.
A podcast and a video and lots of tables.
So we are there to do whatwe can and it's all free.
And, Paul@paulmerriman.comYou got a question?
I, I get up early in the morningand the first thing I try to
do is get on those questions.
(18:04):
So we are truly here tohelp and it is all free.
Well, that's awesome what you do, becausethere are other organizations that we
should mention because we've had them on.
The show, next Gen Personal Financeis all about teaching high school
teachers so that kids get this.
So teach the teachers andthe students get it too.
So there are so many ways coming fromthe private sector to fix this problem.
(18:30):
Tim Ranta is one of my true heroes.
The man who started.
I can't remember the, the lady he startedit with, but they started NGPF and they
are providing free, I. Curriculum from,I think the sixth or seventh grade
through senior year of high school.
(18:50):
And they, not only is it all free for theteachers, but their teacher development,
their, their personal development programto provide the teachers the information
to be a, a successful teacher in anarea that a lot of these teachers.
They're not risk takers themselves,and so they need to be educated
(19:12):
to what is the right way tolook at all these money topics.
He has a question of the day and whata lot of people don't know, and I don't
know if you, you guys know this, you don'thave to be a teacher to go to ngf.org.
To have access to the question ofthe day or the information on all
(19:36):
the different topics that theyare teaching young people about.
And they strive, they tryto be so current so that it.
Really gets the attention of the students.
they're just an amazing organization andTim does not take a penny of compensation.
I think he worked six days a week andit used to be that it was only his own
(19:58):
money that was driving that organization.
he is just one of my heroes.
Yeah, I, I agree.
I'm very familiar with that organizationand the content they provide and the
support for teachers is outstanding.
And this is like a yearconfessions for me.
But I will confess that when Iwas getting ready for my CFP exam.
(20:20):
If there was something where Ibarely knew the basic, I would go
to ngf.org and I would go to theirYouTube, make sure I had the basic.
The foundation so that I couldlearn all of this stuff and
layer it on top of that platform.
And so they do an outstanding job.
And you're right, they serve morethan just teachers because so
(20:41):
much of their material is public.
So that's yet, so I love the fact thatyou obviously have an amazing nonprofit,
but you also appreciate others in thespace that's trying to do the same
thing, educate people on their finances.
You know, something else that wedo, I would've forgotten about
this, that this hadn't come up.
(21:03):
We have a page of truth tellers.
I know my days are numbered.
I can't do this forever.
I. and at the time that the point that Ican't, the question is, who can you trust?
Now, there are lots of people youcan trust that are not on that
list, but Jim Dawley the work thathe does at the White Coat Investor.
(21:27):
I don't care if you're a doctoror a dentist or not, he just
does some of the best educationalwork that I know on the internet.
The other people that we have there,sometimes they're not well known.
I. 'em, but they put out informationin a way that I really believe
they are going to be able tohelp people be a better investor.
(21:52):
And I don't cover all the estate planningand I don't cover the things that A
CFP would cover, but these people do.
And so I'm also trying to give people,folks that I think will be able to
help them today or in the future.
Jackie is very involved as is NGPF, withsort of political activism in a way,
(22:16):
trying to get this in all the states.
And I want to hear from Jackiehow many states we have required
financial literacy education
Yeah.
You know, I keep up with it.
Well, I'm gonna give our guestsa chance to answer that question.
Do you happen to know Paul,
I think it's 26.
it is?
26. Woo.
You get the prize.
You get the prize.
fact that he hires lobbyists.
(22:38):
To go talk to the people.
If he knows there is a state that'sin the process of considering it,
he is gonna spend the money tomake sure that the story is told.
And I hope you're one ofthose storytellers that
would be wonderful to learn.
Yeah.
Well, the most recentwin was a really big win.
It was the state of California.
(23:00):
They've
been fighting with thatone for a long time,
It takes time.
This is must be frustrating to Tim.
I think California goes live in31, 20, 31, if I'm not mistaken.
the way they do it is they getfour years to get it right.
Right.
'cause you can't have a high school juniornow all of a sudden they gotta take it.
So it's in the implementation phase.
(23:21):
I'm in Ohio, ours got passed in 2021,and we have one more year until we
can say we are fully implemented.
But there's still a lot of work going on.
That's great.
Well he's remarkable.
The process.
I'm going to be speaking this summerat the Garrett Planning Network.
Meeting some of their advisors whocome anyway, and I'm gonna be talking
(23:46):
about the future of financial literacy.
I am so thrilled.
To see what is happening.
We know that investinghas never been easier.
It has never been cheaper.
We've never been as tax efficient.
We've never been as diversified that theunit of return per unit of risk is so
(24:09):
much better today than when I came inThe industry in the mid sixties and the
resources on the internet can be so good.
That's the good news.
The bad news is.
That there's so much terribleinformation on the internet that we've
just gotta make sure we find a way.
(24:32):
To get our useful and I think mostproductive information in the hands
of young investors and it'll makea big difference because if, if I,
whatever I ended up with right now atage 81, if I had the ability to invest
in 1963 when I started investing.
(24:54):
I would have twice as much money todayas I have because the costs were so high
Right.
and we didn't even know about index funds.
We didn't even know aboutthe small cap value factor.
And yeah.
(25:15):
Ages over, over this topic.
And we gotta give a plug for whatthe Bogle Center for Financial
Literacy is also doing boglecenter.netand the Bogle Heads Conference.
They also are very passionate aboutfinancial literacy education, and they
have a conference that we recommend toeverybody, including our late starters.
(25:36):
And then we see parents taking theirkids to Bogle Hills and we see kids.
Taking their parents.
So it's generational educationand the conference is a way to
get really passionate about it.
And you put all these thingstogether and you become an expert
that educates others, right.
Jackie?
That's right.
And we are with this show and duringfinancial literacy month, we are just
(26:00):
going to package together all theseamazing resources that Paul just mentioned
that who's my co-host that, oh, sorry.
That bill just mentioned our great socialmedia maven, Diana, she may have some,
but we are going to put together, likePaul was saying, some great credible
resources that you can use for education.
(26:22):
And Paul, what you were justsaying kind of struck a chord
with me and our late starters.
You were saying when you startedway back in the day, things were
so much more expensive and theinvesting landscape was so different.
And right now.
Is one of the easiest times inhistory to invest in the lowest times.
So for late starters, those are otherbenefits that you have starting now versus
(26:46):
maybe 20 years ago when we wish we did.
We can't go back and change time,but the investing landscape piece
of it has gotten a lot easier.
So that part is probably gonnabe much easier for you today than
what it may have been 20 years ago.
In the earlier you start, the earlieryou can retire, if you get these things
right without making mistakes that weas late starters made and you know.
(27:12):
It, it will make so much of adifference in so many people's lives.
These resources thatwe're putting out there.
Share them.
Share them widely.
Have 'em come listen to catching up tofi, you know, point people in the right
direction when they're ready to listen.
Well, and there are things happening tooin the world, in the 401k world that are.
(27:37):
Absolutely life changers.
The one that is such a wonderful change.
People used to go to work for mostcompanies and they were offered a
chance to be part of the program.
Would you like to join our 401k plan?
and we'll put some money in there tomatch some of the money that you put in.
(27:58):
And it turned out very few peoplesaid yes, because you were about
to take money out of my pocket.
And you're gonna put itwhere I can't spend it.
Look, I just got outta collegeor just got outta high school.
I wanna spend the money I'm gettingand very few people, less than 30% were
taking advantage of those early years.
(28:20):
Now they have an opt out programbasically so that when you go to
work for the company, you have toactually tell the company, no, I do
not want to have that money taken out.
83 or or 85% are now in the program fromday one, because they're not opting out.
(28:42):
They're learning to live on less.
And that is so big.
That is a life changerfor millions of people.
Well, I mean, it's important.
They also have.
Auto escalate too.
as you earn more, you save more,you invest more, it grows more.
And the reason we need to dothis is because we live longer.
(29:03):
People used to live on social security.
and there's about 40% of the nationstill does live on just social security.
But we don't have to.
We can't put our cash in the mattress.
We have to put our cash to work for usso we don't have to work as hard and
we can work a shorter amount of time.
Exactly.
That's what it's all about.
And I think all this education thatyou're doing and, just so many folks
(29:28):
that are focused now, you and others.
Are in the business also to build afollowing and, hopefully that that
means that it is a business that youcan rely on to be here for decades.
I mean, wouldn't that begreat if it all worked?
that's the plan.
That's the plan.
We're, we're working on a milliondownloads and more and we should
(29:49):
say we're recording this the dayafter our two year anniversary.
February 19th, 2023, the first episodeof catching up to FI drops, so happy.
By one day to catch the Amplify
and many more years to go.
Jackie, any, any final thoughtson this financial literacy month?
(30:10):
I don't have anything otherthan, I want people to know
that, to the extent that they.
Look to us as one of thosepublic educators that it's gonna
take some work on your part.
It's going to take, I'm guessingyou really have gotta put aside.
(30:31):
At at least 20 hours of reading articles,listening to podcasts, do things that
take you deep enough that you reallycan walk away and say, I get it.
Because when you say, I get it,you are probably at least close
to being able to stay the course.
(30:52):
Because at the end of the day, if youcan't stay the course, you don't get it.
So you gotta, you got, you gotta take thecourse and you've gotta stay the course.
Yeah, and I think they canobviously spread that out.
And, you know, you mentioned 20 hours,over, I think it took me over a year to
start putting all the pieces together.
We hope that Catching up to FI willbe a part of your learning process.
(31:15):
We're gonna drop Paul's nonprofit.
We're gonna drop all of these otherresources that we just talked about,
because we know we're not the onlyvoices, but we hope to continue
to be a part of your journey.
Financial literacy is so important,not just for you, but also for the next
generation that's coming behind you.
So this was so helpful, Paul, andthank you one for what you're doing.
(31:39):
Thank you for sharing with us whatfinancial literacy means to you
and how you're making an impact.
It really does make a difference.
So we are gonna enjoy the rest offinancial literacy month and we will catch
you next time on catching up to five.
Thank you both.
All the best to you and toyour viewers and listeners.
(32:00):
All
Paul.
See you soon, my
All right?
All right?
See you in San Antonio.
Yes.
Bye guys.
See you next week.
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