How are two doors that are adjacent and look the same, relevant to you and your retirement, I hear you ask?
As I see it there are two possible financial outcomes to your retirement. Behind Door Number One, your money outlives you. It gives you independence and dignity through a 30 plus year retirement. It means legacies for the generations that follow. Behind Door Number Two, you outlive your money. You become reliant on your family or indeed the state. The harsh reality is there are only two outcomes when you retire, you will be going through one of the doors.
It is my firm belief that having a financial plan will significantly increase your chances of getting through Door Number One. I cannot of course guarantee it. If you have no plan, I fear Door Number Two.
What is real risk? Our upbringing combined with widely held views of the financial services industry has influenced our psyche as humans. Many of us tend to think of risk in retirement as the risk of losing our principal. The real risk that we actually face, through a thirty-year two-person retirement, is not losing our principal but outliving our money and purchasing power.
By taking Door Number Two, you will most likely be invested in bonds and other structures that are described as safe, low-risk assets. To me, “Safety” in retirement is an income that rises more than your living costs. This can only be achieved with proper planning and some element of rising income and capital values that the great companies of the world historically provide. This is counterintuitive and countercultural, but true.
If you are in the stage of life where you are saving for that thirty-plus-year retirement, we can help you figure out where you are going and how to get there. If you are retired, we can help you plan a strategy to help you beat inflation & leave the greatest possible legacy.
I invite you to see which door you will choose? As always this conversation is on us and without obligation.