When Should I Take A Profit?

By |2020-04-15T01:05:22+00:00November 5th, 2018|Annuities|

To Take Profit or Not to Take Profit?: That is the Question.

With all the volatility that we see in the market these days, it is incredibly stressful trying to decide what to do next if you have money in the market. Is this just a temporary correction in the market that I can wait out, or is it the beginning of a bear market that could take years to recover?

Most of my radio listeners have experienced the bear markets of 2000 and 2008 and know that it took years just to get back to where they were before those crashes. (Imagine if you never had to waste all those years just getting back to where you were). But now, with 10 years of a bull market, and most people being ahead of the game again- at least on paper- it is difficult to know what to do next. If money is in a brokerage account outside of a qualified plan (IRA, 401K, 403(b), etc.) and you have a paper gain, and you sell at a profit then you are subject to taxes and out of that stock or mutual fund. What if you sold too soon and gave up additional profits that would be coming if you had held on? What should you do? It is a dilemma that causes a lot of anxiety, as we see these wild swings in the market over the last several months.

If your funds are in a retirement account, you don’t want your 401(K) to become a 201(K), as they used to say right after the last two significant market corrections, do you? As we are all 18 years older than the first of these crashes in 2000 and a decade older than the 2008 revision, most baby boomers do not relish the thought of having to go through 5-6 years or longer to get back on track with their retirement plans. So much closer to, or already in retirement, can you afford to withstand another 40-50% correction if that were to occur soon? It will happen at some point- by definition the market goes up and down.

There is a solution that many of my listeners and all of my clients have that relieves that stress by eliminating that question completely of when to take a profit. My clients lock-in real gains without having to sell, and without having to pay capital gains in the year that they realize those profits. Like everyone over the past multiple years, we have seen significant gains in our clients’ accounts, and we have been able to lock those gains in every year.

They can never be lost in the next market correction- which will come at some point. We realize actual gains, not paper gains only (which can disappear before they are ever realized), and we never suffer any losses to those gains or to our principal when the market goes down.
Some people think this is too good to be true because their financial advisor, broker, or banker has not explained this to them. But it is true, and there are billions of dollars in these products that allow you to have a stress-free retirement.

In addition to locking in your gains automatically each year, and never seeing your account value decline because of market downturns, you can also have guaranteed growth for lifetime income, regardless of market performance. Why worry about the market getting you to your goal for retirement income when you can get there on a guaranteed basis with an income account that grows at a guaranteed rate every year- usually at 7% or better at today’s rates.

Of course, your advisor would not want you to move your money to these strategies as that would end your being his lifetime annuity! He hates these products and hopes to convince you to hate them too! But I don’t know of anyone who hates their Social Security check, or the Pension check they receive every month.

Those payments are predictable and give peace of mind, but compared to the benefits our products offer, you should love these even more, as they provide all the safety and predictability of Pensions and Social Security payments, but additional benefits as well. Call or email me if you’d like to find out more!


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About the Author:

Robert Kelly is recognized as a leading expert in retirement planning. He was a featured representative and expert on two Nationally Syndicated Radio Shows, “Straight Talk Wealth Radio” and “The Retirement Solution Show.” Websites: robertkellyfinancial.com | bobkelly.retirevillage.com

Office: (954) 568-4910 | Safe Money & Income Solutions