Bruce Hosler welcomes a special guest for today’s episode. We discuss the critical state of the U.S. national debt and its implications for future tax rates with David McKnight, author of “The Power of Zero.” McKnight highlights the dramatic increase in national debt from $5 trillion in 1999 to an expected $54 trillion by 2033. This surge is attributed to unfunded wars, healthcare programs, and economic bailouts. The conversation underscores the lack of governmental action to address the unfunded obligations for Social Security, Medicare, and Medicaid, which pose a significant threat to the country’s fiscal stability.

McKnight points out the alarming debt-to-GDP ratio, warning that exceeding a 175% threshold could lead to a financial collapse from which recovery would be impossible. The discussion also highlights the rising interest rates and their impact on the servicing costs of the national debt, underlining the urgent need for substantial revenue sources to manage these expenses alongside government operations. These costs will almost assuredly mean higher taxes, making it crucial for investors to act now.

The conversation shifts to tax planning strategies, critiquing the financial industry’s general lack of preparedness to help individuals navigate toward tax-efficient retirement. McKnight categorizes financial advisors based on their approach to tax planning, advocating for a comprehensive strategy that includes Roth conversions and life insurance retirement plans to achieve a tax-free income in retirement.

David criticizes popular financial gurus for their inadequate guidance on tax planning and their general dismissal of specific financial products that could benefit retirees. He introduces his upcoming book, “The Guru Gap,” which exposes the shortcomings in the advice these gurus provide and offers a path to better financial planning.

Finally, the discussion addresses the impending challenges with the Medicare Trust Fund and the necessity for significant tax increases to cover the looming fiscal shortfalls. McKnight emphasizes the importance of proactive financial planning to mitigate the impact of higher taxes and ensure financial stability in retirement.

Throughout this episode, Bruce and David discuss several strategies investors can use to protect themselves and move toward a tax-free retirement.

To purchase a copy of Bruce's new book, MOVING TO TAX-FREE, go to https://movingtotaxfree.com.

For more information about anything related to your finances, contact Bruce Hosler and the team at Hosler Wealth Management: Visit them online at https://www.hoslerwm.com/

Or call them in their Prescott office at (928) 778-7666 or their Scottsdale office at (480) 994-7342.

For more podcast episodes, visit our podcast website at https://hoslerwm.com/protectingwealthpodcast/

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