Gillian, Twenty Five Years, Forty Percent discussed on 790 KABC Programming
And Gillian mornings six to ten. seven ninety day ABC. I had. money and we are back this is money matters we can race and of course I am your host can arrive. thank you Jack I have been a certified financial planner professional for the last twenty eight marvelous wonderful and very exciting years and all of the ideas that we talk about on this show these are the very same ideas that we talk about with our beloved and most valued clients and we are a firm that we specialize in retirement planning retirement plan as of America as the name implies and I have been working with people I just love you know the the people that we love that we want to work with our within five years of retirement or their five years into retirement now of course will work with people are beyond that but that ten year period is kind of our sweet spot and the reason why I say that is because that is the time we believe is the most important decade of your entire financial life because no matter how well you did getting to your retirement if you take a massive big loss in a bear market or you make a big the you know you you make a big mistake with a bad financial decision and it cost you a lot of money and all that then your ability to retire regardless of how well you did to get to that point could be severely impaired you for already retired he could on retire you and cause you to have to go back to work and if you've been out of the workforce for a while you may not be able to do that so all kinds of terrible things come from losing a large sum of money in a rapid period in a small time period in our view so. therefore as I said we work with people that are retired or trying since our philosophy is we need to defend against things that could that cause you that kind of financial harm and you know for our clients we have two goals the first one is that we want you to have financial peace of mind we want you to not worry about all the stuff you know is the result we always say that your retirement your second childhood without parental supervision we want you to go play and have fun just go go to the beach go climb a mountain geld gonna cruise your grand children just get out here and you know we want to facilitate that if we can and then also what we want to do is we want to have your money last as long as you do okay so if we want to support the lifestyle that you have for as long as you live so to do that we believe that you need to have a plan in place to address bear markets which we consider to be one of the three top threats to your financial well being taxes and inflation being the other two and so. we have a strategy in our firm that we call by hold and protect okay meaning that we don't stop it just buy and hold we also continue with the next step which for which is the protect part and so we believe in protecting our clients from from their markets and so we have a strategy that in fact in November of two thousand seven told us to tell our clients to sell and get out and those that followed our advice were were out of all equities for. from November of oh seven until June of two thousand nine so for almost a year and a half there during the credit crisis in the crash of two thousand eight all that they were sitting on the sidelines and if they did that then they didn't Kerr those losses that could have happened so that's a very important component our strategy is not perfect as those of you who listen to the show you know that our strategy said the cell in two thousand eighteen last year towards the end but you know what we were facing a lot of respect there was a lot of risk in the market went down savagely you probably forgot about at this point because as a while ago but yeah I did and so we saw danger and we said you know what we need to protect our clients from danger and that's why we did that that's what we do. we do what we do and so. that's a kind of contrary to the whole notion of buy and hold which is Hey you buy a a basket of the quality investments and you re balance them periodically and then you're done and then the by hold myth that I wanna dress this week is is that and the reason why you do that is because the market will all it has always come back the market always goes back if you don't need to worry about okay and that's the idea behind it'll come back to just kind of close your eyes and ignore it well there are lots of problems with that first of all if the value of your accounts has fallen dramatically and you're taking out the same amount of money that you were before you have now taken out a much larger percentage of your money while you're doing that and in fact you may take all of your money out while you're doing that and run out that that in fact you're doing what farmers call if your seed corn and if you do that then when planting season come you have you eat all your seat car already there's nothing left the plant and that would be a bad thing now the other thing that is wrong in my opinion with this whole notion that the market always comes back is where's the contract that says that that's going to happen where's the guarantee that this is going to in fact happen and I am I willing to bet my security in my retirement on that guaranteed there is no guarantee no one in fact everywhere you go they tell you past performance is no guarantee of the future and all that because it doesn't there's no such thing now. let's examine the market always comes back now if we look at that the Nikkei for those of you who've been around for a while that's a Japanese to twenty that's their version of their of the dial so the Nikkei back in nineteen eighty nine and you may remember if you're of a certain age how they were buying up all of our golf courses in Japan was the preeminent economy and we were jealous and thinking man are gonna take over everything and their stock market hit a peak in nineteen eighty nine towards the end of eighty nine and it's a ninety today you know where it is it's down forty percent from that peak that was nineteen ninety says twenty nine years ago and it's still down forty percent from that peak it may never recover but you're saying can can can please that's Japan that's not us that's not America we are you know week find ways to solve things we are number one we are the we're the United States of America that doesn't happen to us we will do not have that happen well I got news for you the Dow Jones peaked in nineteen twenty nine guess how many years it took back after the stock market crash of nineteen twenty nine to get back to even nineteen fifty four is when I got back to even it took twenty five years so let me ask you ladies and gentlemen if the if the stock markets the your equity investments crashed and went down like that and it took twenty five years to get back to even hold for you right now. how old would you be when you get done we have a problem how old would you be when you get back to even and that assumes that you're not living on the money you're not eating your seed corn if you're living on a wall that all is happening when would you get back to you I suspect it may not happen so that's why the risk of this by hold strategy is so great for someone who's retired a retiring soon we just don't buy that it's just not we don't believe it's a good strategy you need to have in our view an additional strategy which is to protect what you've built. and if you have that we believe it would go for a long way towards giving you are our first goal which is for you to have peace of mind so if this resonates with you if you think it makes any sense at all I encourage you to go to our website we are retirement planners of America in our website is R. P. O. a dot com and when you go there we have videos and articles about our strategy about our services but we can do to help you you know and and we're not here to make you rich quick we're here to keep you from becoming poor that's our goal we want you to support we want to be able to support your lifestyle of facilitate that for you so if you go to our website you have options of attending our seminars you can watch our webinars you can meet with one of our retirement planners and have them build a plan for you at no charge obligation we have lots and lots of resources available to you that I really would be happy if you took advantage of okay no charger obligation for any of them so our website again is our P. O. a dot com all right we're gonna take a break when we come back we never stay tip of the week which is on how to pass on to your greedy unwashed undeserving errors the fruits of your labor so stay tuned this is money matters and I am can Morais retirement should be one of the best.