{"product_id":"the-value-of-debt-isbn-9781118758618","title":"The Value of Debt","description":"\u003cb\u003eA \u003ci\u003eNew York Times\u003c\/i\u003e bestseller and one of the Ten Best Business Books of 2013 by \u003ci\u003eWealthManagement.com\u003c\/i\u003e, this book brings a new vision of the value of debt in the management of individual and family wealth\u003c\/b\u003e  \u003cp\u003eIn this groundbreaking book, author Tom Anderson argues that, despite the reflex aversion most people have to debt—an aversion that is vociferously preached by most personal finance authors—wealthy individuals and families, as well as their financial advisors, have everything to gain and nothing to lose by learning to think holistically about debt.\u003c\/p\u003e \u003cp\u003eAnderson explains why, if strategically deployed, debt can be of enormous long-term benefit in the management of individual and family wealth. More importantly, he schools you in time-tested strategies for using debt to steadily build wealth, to generate tax-efficient retirement income, to provide a reliable source of funds in times of crisis and financial setback, and more.\u003c\/p\u003e \u003cul\u003e \u003cli\u003eTakes a \"strategic debt\" approach to personal wealth management, emphasizing the need to appreciate the value of \"indebted strengths\" and for acquiring the tools needed to take advantage of those strengths\u003c\/li\u003e \u003cli\u003eAddresses how to determine your optimal debt ratio, or your debt \"sweet spot\"\u003c\/li\u003e \u003cli\u003eA companion website contains a proprietary tool for calculating your own optimal debt ratio, which enables you to develop a personal wealth balance sheet\u003c\/li\u003e \u003c\/ul\u003e \u003cp\u003eOffering a bold new vision of debt as a strategic asset in the management of individual and family wealth, \u003ci\u003eThe Value of Debt\u003c\/i\u003e is an important resource for financial advisors, wealthy families, family offices, and professional investors.\u003c\/p\u003e \u003cp\u003eForeword xi\u003c\/p\u003e \u003cp\u003eAcknowledgments xv\u003c\/p\u003e \u003cp\u003eIntroduction xvii\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart 1: The Value of Debt in the Management of Wealth 1\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 1: Strategic Debt Philosophy: An Overview 3\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eHow This Book Can Add Value to Your Life 3\u003c\/p\u003e \u003cp\u003eThe Five Tenets (or Action Principles) of Strategic Debt Philosophy 4\u003c\/p\u003e \u003cp\u003eChapter 1: Summary and Checklist 14\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 2: The Basic Idea: Limiting the Costs, the Impacts, and the Duration of Financial Distress 21\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eRisk of Financial Distress 22\u003c\/p\u003e \u003cp\u003eThe Direct and Indirect Costs of Financial Distress 23\u003c\/p\u003e \u003cp\u003eThe Impact of Financial Distress: Five Levels 24\u003c\/p\u003e \u003cp\u003eThe Duration of Financial Distress 25\u003c\/p\u003e \u003cp\u003eThe Four Indebted Strengths: A First Look 26\u003c\/p\u003e \u003cp\u003eThe One Thing You Must Consider! 26\u003c\/p\u003e \u003cp\u003eChapter 2: Summary and Checklist 29\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 3: Strategic Debt Practices: An Overview 33\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eUnderstanding and Taking Advantage of Strategic Debt Philosophy 34\u003c\/p\u003e \u003cp\u003eAchieving and Maintaining an Optimal Debt-to-Asset Ratio 37\u003c\/p\u003e \u003cp\u003eCalculating Your Debt-to-Asset Ratio 41\u003c\/p\u003e \u003cp\u003eShould Your Primary Residence Be Included in Your Debt Ratio? 43\u003c\/p\u003e \u003cp\u003eWhen to Pay Down Your Debt, and When Not To 45\u003c\/p\u003e \u003cp\u003eAdvanced Practices and Scenarios 47\u003c\/p\u003e \u003cp\u003eChapter 3: Summary and Checklist 49\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart 2: The Assets-Based Loan Facility 53\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 4: The Value of an Assets-Based Loan Facility (ABLF) 55\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eWhat an ABLF is and How It Works 56\u003c\/p\u003e \u003cp\u003eThe Many Advantages of Having an ABLF in Place 59\u003c\/p\u003e \u003cp\u003eWhy Virtually Every Company Has a Line of Credit 61\u003c\/p\u003e \u003cp\u003eSurviving Storms and Other Natural Disasters 62\u003c\/p\u003e \u003cp\u003eThe Criticality of Being Proactive and Assessing Risks 64\u003c\/p\u003e \u003cp\u003eFamily Finances: First Bank of Mom and Dad; Elder Care Bridge Loan 67\u003c\/p\u003e \u003cp\u003eTaking Advantage of Opportunities and Distressed Sales 68\u003c\/p\u003e \u003cp\u003eAverage ABLF Usage and the Win-Win-Win Scenario 70\u003c\/p\u003e \u003cp\u003eChapter 4: Summary and Checklist 71\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart 3: Scenarios for Success 75\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 5: Long-Term Wealth Amplification through Capturing the Spread 77\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eThe Basic Concept: Inherent Risks with Great Potential Rewards 77\u003c\/p\u003e \u003cp\u003eThree Key Factors to Consider 79\u003c\/p\u003e \u003cp\u003eSome Scenarios for Capturing the Spread 83\u003c\/p\u003e \u003cp\u003eSynching with Your Investment Strategy 93\u003c\/p\u003e \u003cp\u003eChapter 5: Summary and Checklist 93\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 6: Holistic Financing of the Expensive Things You Need and Want 99\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eA Better Way to Buy: In the Company of Holistic Financial Thinkers 99\u003c\/p\u003e \u003cp\u003eFour Principles When Financing the Purchase of a Desired Item 100\u003c\/p\u003e \u003cp\u003eA Better Way to Purchase a Vehicle (or Almost Anything Else) 108\u003c\/p\u003e \u003cp\u003ePurchasing a Second Home: Pluses and Minuses 111\u003c\/p\u003e \u003cp\u003e100 Percent Financing: The No Down Payment Real Estate Purchase Option 117\u003c\/p\u003e \u003cp\u003eChapter 6: Summary and Checklist 119\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 7: Generating Tax-Efficient Income in Retirement or Divorce 123\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eIntroduction: Three Goals (and Some Disclaimers) 123\u003c\/p\u003e \u003cp\u003eAn Opening Scenario for No Taxes in Retirement 124\u003c\/p\u003e \u003cp\u003eBorrowing Versus Selling to Access Your Money 125\u003c\/p\u003e \u003cp\u003eA Better Alternative to a Familiar Story 127\u003c\/p\u003e \u003cp\u003eTying It Back to Capturing the Spread 128\u003c\/p\u003e \u003cp\u003eRevisiting Tax Issues 130\u003c\/p\u003e \u003cp\u003eMaking Use of Strategic Debt Strategies and Practices in Divorce 138\u003c\/p\u003e \u003cp\u003eChapter 7: Summary and Checklist 143\u003c\/p\u003e \u003cp\u003e\u003cb\u003eChapter 8: Conclusion: What This Book is Really About 149\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eWhat We Hope You Have Taken Away 150\u003c\/p\u003e \u003cp\u003eStrategic Debt as a Financial Engine over the Decades 153\u003c\/p\u003e \u003cp\u003eParadoxes of Plenty: Some Surprises in Maintaining an Ideal Debt Ratio 158\u003c\/p\u003e \u003cp\u003eInvesting in the Future: A Cautionary Reminder 162\u003c\/p\u003e \u003cp\u003eA Final Thought 164\u003c\/p\u003e \u003cp\u003eChapter 8 Summary: A Recap of the Book’s Significant Lessons 164\u003c\/p\u003e \u003cp\u003e\u003cb\u003ePart 4: Appendixes 169\u003c\/b\u003e\u003c\/p\u003e \u003cp\u003eAppendix A: The Varieties of Debt 171\u003c\/p\u003e \u003cp\u003eAppendix B: Strategic Debt Practice for the Young and Those with Limited Assets 175\u003c\/p\u003e \u003cp\u003eAppendix C: No Guarantees: Limiting the Risks of Investing in a Crazy World 185\u003c\/p\u003e \u003cp\u003eAppendix D: Some Examples of Ideal Debt Ratios 209\u003c\/p\u003e \u003cp\u003eGlossary 225\u003c\/p\u003e \u003cp\u003eBibliography 229\u003c\/p\u003e \u003cp\u003eAbout the Author 231\u003c\/p\u003e \u003cp\u003eAbout the Companion Website 233\u003c\/p\u003e \u003cp\u003eIndex 235\u003c\/p\u003e  \u003cp\u003e\u003cb\u003eTHOMAS J. ANDERSON\u003c\/b\u003e worked in investment banking in New York before moving into private wealth management. His extensive academic studies at some of the top schools in finance and economics, international experience, and institutional background bring a unique perspective to delivering advice to the individual and on \u003ci\u003eThe Value of Debt\u003c\/i\u003e.   \u003c\/p\u003e\u003cp\u003eVirtually every CFO of a large company recognizes that both assets and debts can be sources of financial strength. Yet the vast majority of high-net-worth individuals are either perilously over-leveraged or, more commonly, tragically under-leveraged.\u003c\/p\u003e \u003cp\u003eIn this groundbreaking book, author Tom Anderson argues that, despite the reflex aversion most people have to debt—an aversion that is vociferously preached by most personal finance authors—wealthy individuals and families, as well as their financial advisors, have everything to gain and nothing to lose by learning to think holistically about debt, the way CFOs do.\u003c\/p\u003e \u003cp\u003eViewing amortization as the enemy of good financial sense, with only a few notable exceptions, Anderson explains why, if strategically deployed, debt can be of enormous long-term benefit in the management of individual and family wealth. More importantly, he schools you in time-tested strategies for using debt to steadily build wealth, to generate tax-efficient retirement income, to provide a reliable source of funds in times of crisis and financial setback, and more.\u003c\/p\u003e \u003cp\u003eTaking a Strategic Debt approach to personal wealth management, he emphasizes the need to appreciate the value of \"Indebted Strengths\" and for acquiring the tools needed to take advantage of those strengths for increased liquidity, flexibility, leverage, and survivability.\u003c\/p\u003e \u003cp\u003eBut, as he explains, before you can begin to leverage your indebted strengths, you must first determine your optimal debt ratio, or what he refers to as your debt \"sweet spot.\" To that end, he describes methods CFOs use to determine their companies' debt sweet spots, and he shows you how to apply those methods in finding yours.\u003c\/p\u003e \u003cp\u003eAnderson then supplies you with a set of advanced techniques for leveraging your indebted strengths, including:\u003c\/p\u003e \u003cul\u003e \u003cli\u003eCapturing the spread, or, in other words, profiting from the difference between the value of an investment and cost of the debt incurred to make it\u003c\/li\u003e \u003cli\u003eA discussion on second homes (including renting versus buying) and a framework for how much of a second home you can afford (and how much of it should be financed)\u003c\/li\u003e \u003cli\u003eBetter ways to purchase and finance cars, boats, and luxury items\u003c\/li\u003e \u003cli\u003eHow you can help your children and grandchildren by using your balance sheet\u003c\/li\u003e \u003cli\u003eHow access to the right kind of debt can help you and your family be better prepared for an emergency\u003c\/li\u003e \u003cli\u003eThe best way to do eldercare transitions including bridge loans for you or someone in your family\u003c\/li\u003e \u003cli\u003eAlternative means of financing home improvements, college, real estate, raw land, and business investments\u003c\/li\u003e \u003cli\u003eWays to create tax-favored income in retirement and divorce\u003c\/li\u003e \u003c\/ul\u003e \u003cp\u003eIn \u003ci\u003eThe Value of Debt\u003c\/i\u003e, Anderson proves that all else being equal, a lower volatility portfolio with some debt is better than a high-volatility portfolio with no debt. He also takes a balanced approach and has an in-depth discussion of the risks inherent in this strategy. This includes an overview of the different economic environments we could face and base case scenarios that all investors should be aware of.\u003c\/p\u003e \u003cp\u003eIn addition, on \u003ci\u003eThe Value of Debt\u003c\/i\u003e companion website you'll find a proprietary tool for calculating your own optimal debt ratio. With inputs for assets and liabilities, it enables you to develop your personal wealth balance sheet and to compare it to examples provided by the author.\u003c\/p\u003e \u003cp\u003eOffering a bold new vision of debt as a strategic asset in the management of individual and family wealth, \u003ci\u003eThe Value of Debt\u003c\/i\u003e is an important resource for financial advisors, wealthy families, family offices, and professional investors.\u003c\/p\u003e  \u003cp\u003eVirtually every CFO of a large company recognizes that both assets and debts can be sources of financial strength. Yet the vast majority of high-net-worth individuals are either perilously over-leveraged or, more commonly, tragically under-leveraged. \u003c\/p\u003e\u003cp\u003eIn this groundbreaking book, author Tom Anderson argues that, despite the reflex aversion most people have to debt, wealthy individuals and families, as well as their financial advisors, have everything to gain and nothing to lose by learning to think holistically about debt, the way CFOs do. \u003c\/p\u003e\u003cp\u003eViewing amortization as the enemy of good financial sense, with only a few notable exceptions, Anderson explains why, if strategically deployed, debt can be of enormous long-term benefit in the management of individual and family wealth. More importantly, he schools you in time-tested strategies for using debt to steadily build wealth, to generate tax-efficient retirement income, to provide a reliable source of funds in times of crisis and financial setback, and more. \u003c\/p\u003e\u003cp\u003eTaking a Strategic Debt approach to personal wealth management, he emphasizes the need to appreciate the value of \"Indebted Strengths\" and for acquiring the tools needed to take advantage of those strengths for increased liquidity, flexibility, leverage, and survivability. \u003c\/p\u003e\u003cp\u003eBut, as he explains, before you can begin to leverage your indebted strengths, you must first determine your optimal debt ratio, or what he refers to as your debt \"sweet spot.\" To that end, he describes methods CFOs use to determine their companies' debt sweet spots, and he shows you how to apply those methods in finding yours. \u003c\/p\u003e\u003cp\u003eAnderson then supplies you with a set of advanced techniques for leveraging your indebted strengths, including: \u003c\/p\u003e\u003cul\u003e \u003cli\u003eCapturing the spread, or, in other words, profiting from the difference between the value of an investment and cost of the debt incurred to make it\u003c\/li\u003e \u003cli\u003eA discussion on second homes (including renting versus buying) and a framework for how much of a second home you can afford (and how much of it should be financed)\u003c\/li\u003e \u003cli\u003eBetter ways to purchase and finance cars, boats, and luxury items\u003c\/li\u003e \u003cli\u003eHow you can help your children and grandchildren by using your balance sheet\u003c\/li\u003e \u003cli\u003eHow access to the right kind of debt can help you and your family be better prepared for an emergency\u003c\/li\u003e \u003cli\u003eThe best way to do eldercare transitions including bridge loans for you or someone in your family\u003c\/li\u003e \u003cli\u003eAlternative means of financing home improvements, college, real estate, raw land, and business investments\u003c\/li\u003e \u003cli\u003eWays to create tax-favored income in retirement and divorce\u003c\/li\u003e \u003c\/ul\u003e \u003cp\u003eIn addition, on \u003ci\u003eThe Value of Debt\u003c\/i\u003e companion website you'll find a proprietary tool for calculating your own optimal debt ratio. With inputs for assets and liabilities, it enables you to develop your personal wealth balance sheet and to compare it to examples provided by the author. \u003c\/p\u003e\u003cp\u003eOffering a bold new vision of debt as a strategic asset in the management of individual and family wealth, \u003ci\u003eThe Value of Debt\u003c\/i\u003e is an important resource for financial advisors, wealthy families, family offices, and professional investors.\u003c\/p\u003e","brand":"Wiley","offers":[{"title":"Default Title","offer_id":47990362734821,"sku":"NP9781118758618","price":42.0,"currency_code":"USD","in_stock":false}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/1842\/7735\/files\/9781118758618.jpg?v=1761787518","url":"https:\/\/k12savings.com\/products\/the-value-of-debt-isbn-9781118758618","provider":"K12savings","version":"1.0","type":"link"}