Frankle took the money to his father’s stockbroker, who “churned” the account. Frankle was cautious enough to fire the broker after six months. After that, he bought into high yield bonds and held them.
Between that investment income, social security and US Veteran’s Affairs benefits, he was able to passively see $300 per month coming in.
Note that this was the 1970s, when that type of money had a larger impact on his day-to-day life than it would now. In retrospect, Frankle states that without that money, he “wouldn’t even want to think where [he'd] be”.
How did he turn it around?
Eventually, Frankle gave his entire payment (around $25,000) to his sister. The combined inheritance from their father helped her to buy a home to house her and two other siblings. This ensured that they had a roof over their heads while Frankle attended college.
This stability helped Frankle look for a career that would help him build upon his financial security. Having been so close to the precipice of financial ruin, Frankle says he was even motivated by fear to work very hard.
How does Frankle balance both financial and emotional skills?
Frankle references his faith in a higher power as “the only real security there is”. While he now works for financial security and strives to be of service to others, he finds that emotional security includes daily work and isn’t a function of money alone.
What advice would Neal give to those looking at taking out life insurance?
Frankle says that “if you’re responsible for others, you have an obligation to buy coverage”. He recommends term life insurance to cover your loved ones in case anything happens to you.
Neal Frankle’s advice for those living in perpetual financial fear
Frankle recommends the process of sitting down and writing down your fears. Then, write down what you can do about them. If there’s a fear about family continuity, Frankle says, then it’s important to buy life insurance. Income fears are just as actionable. Frankle’s chief recommendation is to define the anxiety and take specific steps to alleviate it by fixing the underlying issue.
For more information on Australia life insurance, check out our guide.