Frank's and Sammy's Human Capital
Frank and Sammy are on their own, old enough for some financial planning. Planning done right is for everybody and every household. Independent of today’s income, the whims of the stock market, or whether one is a renter or a homeowner, there is a need for a baseline financial plan.
The past serial releases of Economics-Based Personal Finance built Chapters 1 through 3, supplying the principles, arguments, and techniques for learning DIYers and CFPs who want to offer the service to non-DIYers. In this first excerpt from Chapter 4, we begin looking at specific case studies of common personal finance questions.
Frank and Sammy are buddies, living apart, with different jobs, different incomes, and a wide gap in living standards because of their fields. Intuitive is that Frank’s higher earnings produce a higher living standard. How much higher? Higher earnings bring along higher taxes and different Social Security retirement benefits that are more than a trickle in the context of a lifetime.
New free subscribers: Each Tuesday through the spring, I am serially releasing the book for paid subscribers. Paid subscribers have other benefits, too, including direct access to me to help them learn. There will be periodic posts open to all subscribers, like this post from last week.
Today: How education, training, and experience affect human capital and subsequently a household’s living standard.
Excerpt:
