Are We There Yet?

Have we hit bottom?

As far as the stock market goes, I mean. It’s hard to tell, but the critical thing to remember is that the recession of 2008 started the week ending 12/31/2007; the market was 13,264.82.

It didn’t hit that mark again until the week ending 8/17/2012. Four and a half years later! The Dow Jones Industrial Average spent most of 2008 and 2009 in single digits! Many of my clients didn’t get back to even until 2013, and then their money could start to grow again. That recession was a disaster for those folks about to retire or already in retirement.

I’ve talked about it before. If you lose 30% in one year and then have a gain of 30% the next year, will you be back to ‘even’? Not hardly. You’ll need a 43% gain the next year to get back to a whole or ‘even.’

Unless you are young and can afford the time, you can see why you can’t afford to take significant losses when you are near or already in retirement.

You know time is the only thing we can’t buy more of; once it’s used, it’s gone. And dollars lost are gone forever. Dollars lost will never compound, never earn another penny of interest.

Risk always needs to be weighed.

It still needs to be calculated. Sometimes you must take the risk -knowing there will be losses- to have enough gains to accumulate for retirement. But most people only calculate gains! They don’t consider risk until too much has been lost. In addition, most people don’t consider the time factor. How soon before you retire? How old are you? How long will I live? How long will my spouse live?

Fortunately, there are financial products that are completely safe and guaranteed to ensure that no matter how long you or your spouse live, you’ll never run out of money. They used to be known as pensions. Now, they are known as Lifetime Income accounts. And they are NOT dependent upon the whims of the stock market, a virus, politics, or wars.

Call me if you want to know more. 931-761-6161