I want to address our national debt. Why? Understanding and explaining the implications is vital. Our current national debt is $14 trillion. The Congressional Budget Office says we will be $20 trillion in debt by 2015, $25 trillion in debt by 2020 and $27 trillion in debt by 2021. The interest on $27 trillion would consume one half of all federal tax revenue. By 2026, the rest of the world combined will not have enough money available to buy all of our debt.
Advisors and clients alike often portray this message as one of doom and gloom, but that misses the point. Our message should be the Boy Scouts’ motto: “Be prepared.” I am able to diffuse any self-defeating emotions and move toward solutions with a few great questions, like:
- Have there been bad financial times in the past?
- Did some people still make money during those bad times?
- Who prospered? People who planned and prepared or people who didn’t?
- Which one do you choose to be?
The questions can be taken in many different directions or can be used along with the first set of questions, for example:
- Is it “doom and gloom” if the government doesn’t pay your way?
- Is it life threatening if corporations don’t pay your way?
- Is your life over if the unions don’t provide for you?
- Do you want to be dependent or independent? Do you want to be in control or do you want to be controlled?
Always end with “When do you want to get started?” Ask and you shall receive.