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What's the real cost of living?

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    Are some states more expensive?

  • Duration 3:52
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Is the federal government lying to us we all know the cost of living changes from year to year they calculated the CPI but our next guest says the government's -- up on just how much those cost increase is grossly.

Under reported.

Cause -- a lot of us to fall behind so our guest is come up with a solution he created his own cost of living index that can apply to all of us -- joining us now to explain.

Is managing partner chaplain capital investment -- do you koskie at great to have you here -- -- you say that the government.

Has these gross inaccuracies.

In the methodology that they've used to calculate the cost of living increase house.

The capsule is in fact since 198384.

This is when it began.

Inflation at that time the CPI number was about twelve point two -- CPI consumer price into the Consumer Price Index and that's what.

Our public.

I'm basically public wages are tied to -- so -- says -- keeping up with inflation or you get an increase in the private sector to keep you up with inflation.

They're using that number but -- started changing the way the methodology is how they calculated it.

And that has a major impact on everybody because when you start to see that number you say well that's what I'm doing and try to keep a constant standard of living short.

And Ed we've we've heard you know the rate of inflation right now it's at about 3% -- up like that -- so we think okay that's how much.

The cost of stuff is going up right that's not true -- you come up with -- and index let's take -- look.

Right now according to the CPI the government data.

Our rate of inflation is three point 6% but look at -- index.

You see essentially it's three times bigger because the government you say is measuring things that art is important -- this stuff you're measured right the things that I measured at the government number has about 60000 items and so if there's anything that you -- that goes up maybe 1520% an example would be a -- okay -- -- but this is crazy but a bagel goes up in cost about fifteen cents.

A year or -- of you -- -- bagel every single day.

I would be fifty more dollars to eat bagels this year than last year then the government doesn't report that type of information of the 500 top items what I did is I sent a message dots on the front I was going crazy over this because people weren't keeping up with what the need to know.

So I got about 4000 items from all my friends of what they spend money on I took -- -- TV cable -- wrongly Chad bill all the things that we spend money on every day and I took the top 500 items and started tracking that because I wanted to communicate to people what really mattered and not just taking the CPI blindly.

And why did that it I realized that this is a major reason not only that people phone behind but also white people rely on entitlements because when everyone.

What has a threshold of pain when you reach it.

Watch out -- people reach that point and they see what can I do -- say I have.

Have to keep all of my standard of living so they reach out on the start using government -- programs are so the bottom.

Line is that because you crunch that the products that you believe people are really using the 500 of them see you think that we get the cost of living is going up much more than we know Rick and so we're -- that explains why people feel more behind -- they do.

Right in its not the cost of living as much as is the cost of living increase the financial advisors need to target.

That you exactly what the increase is in their portfolios we all need to know and everyone has their own you have your -- -- living increase -- of your own.

And you know what -- we got a couple of graphics -- to show for people who live in Atlanta Georgia.

According to government the Consumer Price Index.

It cost has gone up two point 88%.

You say it's actually gone up 10% that's also look at Kansas City, Missouri the government says their cost of living is at 4% you say it is double that so.

And you look at New York City.

You say it's close to 12%.

Look I've been here via the last couple days it just doing anything cost more money this year than it did last year a lot more than three point 6% as -- government -- interest you stuff all right Ed McCaskey from -- would partners down and doubts that extra process.

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