3 reasons people retire broke
Henryjexblog
A retirement expert, Wayne Rothe, gives the following three reasons people retire broke:
We don’t invest:
The number one reason for our failure to achieve our financial goals is our refusal to invest. Fear is the biggest reason we don’t invest; we’re afraid of losing money. You have to understand what risk is – and what it’s not. It’s not market ups and downs. Assuming that you have the time to wait it out, market volatility can be your friend. If there is money that you won’t need for years, then market drops are opportunities to buy into a rising tide at reduced prices. Investment markets and financial planning are complex. Most of us don’t understand them so we often own low-yield instruments such as GICs (guaranteed investment certificates), where we’re pretty much guaranteed to lose purchasing power year after year.
We bail:
You’ve invested – but now what? Don’t expect a smooth ride; investment markets don’t work that way. A friend of mine was persuaded to buy shares in a high-risk sector mutual fund and over a few months his investment tumbled and he sold. Bad decisions:
“You and I are always one stupid decision away from wrecking a retirement dream,” Chris Hogan writes. “One bad risk on a single stock, one afternoon of day trading, one impulsive hour in the showroom of a luxury car dealership — all it takes is one moment of letting your guard down to undo years of hard work.
Henryjexblog
A retirement expert, Wayne Rothe, gives the following three reasons people retire broke:
We don’t invest:
The number one reason for our failure to achieve our financial goals is our refusal to invest. Fear is the biggest reason we don’t invest; we’re afraid of losing money. You have to understand what risk is – and what it’s not. It’s not market ups and downs. Assuming that you have the time to wait it out, market volatility can be your friend. If there is money that you won’t need for years, then market drops are opportunities to buy into a rising tide at reduced prices. Investment markets and financial planning are complex. Most of us don’t understand them so we often own low-yield instruments such as GICs (guaranteed investment certificates), where we’re pretty much guaranteed to lose purchasing power year after year.
We bail:
You’ve invested – but now what? Don’t expect a smooth ride; investment markets don’t work that way. A friend of mine was persuaded to buy shares in a high-risk sector mutual fund and over a few months his investment tumbled and he sold. Bad decisions:
“You and I are always one stupid decision away from wrecking a retirement dream,” Chris Hogan writes. “One bad risk on a single stock, one afternoon of day trading, one impulsive hour in the showroom of a luxury car dealership — all it takes is one moment of letting your guard down to undo years of hard work.
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