It may come as a surprise that I believe in taking an “agnostic” approach when it comes to financial planning. That word has nothing to do with my religious beliefs. Rather my professional observation that traditional financial planning methods often fail to answer the most basic retirement worry: “Will I run out of money before I run out of time?”
It would not be a stretch to claim I’m not a big fan of Wall Street or the traditional methods most advisers use for retirement planning. I walked away from those methods more than twenty years ago when it became evident to me that traditional asset allocation models did not always address the biggest concerns of investors– the fear of running out of money before they ran out of time. Equally scary to most people was the thought of having to rely upon or be dependent upon their children. In my opinion, there is a better way to manage your portfolio but before you can embrace a new way of thinking, you must understand the myths Wall Street wants (and needs) you to believe.
The number one Wall Street myth and the first one that should throw up a red flag is if you hear: “Don’t worry; over the long term, the stock market always goes up.” Most investors have heard this all of their lives. The party line is that if you just sock away cash in stocks on a regular basis, ignore the ups and downs of the market, in the end you’ll be just fine. Then when you retire, you draw 4-5 percent annually from it and you step away happily ever after. Sounds easy, right? The good part of the mantra is the concept of regular savings; the bad part, or at least the unreliable part, is the concept that “long term” the stock market always goes up.
I outline three other big Wall Street myths in my book, The Big Retirement Risk – Running Out of Money Before You Run Out of Time. Briefly, they are:
You can find more information about these myths and the concept of “Lifestyle Driven Investing™” approach at www.botsfordfinancial.com.
Securities offered through LPL Financial, Member FINRA/SIPC. Financial Planning offered through Lifestyle Planning Solutions, a registered investment advisor. Investment advice offered through Stratos Wealth Partners, a registered investment advisor. Botsford Financial Group, Lifestyle Planning Solutions and Stratos Wealth Partners are separate entities from LPL Financial.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
For a list of states in which I am registered to do business, please visit www.botsfordfinancial.com.
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