5 Secrets to Feeling Safe Financially After Retirement
When retirement is already a fact, it is too late to talk about saving money. What do you do then? In today’s video, Wealth Logic founder and financial expert Allan Roth shares some practical strategies for achieving financial security in retirement. Enjoy the show!
Fight Your Urge to Create Income
After decades of earning and saving, it can be scary to think about what happens when the paychecks cease to come in. It’s natural for retirees to want to see a steady flow of cash coming in but Allan advises that creating income through adventurous stocks and bonds is the wrong goal, one that comes with huge risks.
Create a Smart and Boring Portfolio
While you were employed, you may have placed the majority of your investments in stocks, but this should be reevaluated and adjusted after retiring. Allan suggests that investing wisely in retirement means “being more conservative when stocks are on an all-time high, and sticking with it.” He recommends buying a broad stock index fund at an ultra-low cost and staying the course.
Don’t Be So Emotional
It’s easy to think of yourself as being willing to take a risk when stocks are soaring high, but it’s much more difficult to still embrace that risky decision when stocks plummet low. Buying high and selling low is one of the biggest mistakes investors make and it all stems from emotions such as feeling adventurous or feeling panic. That is why being smart and full in your investments is the most practical course to take.
Don’t Feed the Financial Industry
While your financial advisor will probably not encourage you to not use his services, Allan suggests that many investors are wasting money on high fees. Starting early and avoiding intermediaries (such as financial advisors and insurance companies used when purchasing annuities) will save investors a great deal. Likewise, Allan says that delaying social security and buying a government annuity is a wise investment with a consistent pay out.
Aside from our informative videos and articles here at Sixty & Me, Allan suggests many other helpful resources for learning about investment strategies and making wise decisions. One book he recommends is “Can I Retire” by Mike Piper. Also, Bogelheads offers a wonderful forum for posting financial questions and receiving answers from individuals without any invested interest. Allan’s investment advice can also be found on AARP and Next Avenue.
When you hear the word annuities, what’s the first thing that comes to mind? Have you read/subscribed to a financial magazine? Would you recommend any great resource that you have benefitted from? Please join the conversation!