 |
From Mark Ford, founder, Palm Beach Research Group: Retirement is a wonderful idea. You save a portion of your income every month, let it grow in a tax-deferred investment vehicle, and accumulate a vault of wealth. Then 40 years later, tap into that vault to fund 20 years of easy living.
No work. No stress. Nobody to kowtow to. Just traveling, golfing, going to the movies, and visiting the kids and grandkids.
It’s a great idea… but it was never realistic. Prior to the 20th century, retirement was a rarity. Most people worked until they could no longer work and then “retired” into their children’s homes.
The only generation that experienced “the dream” was my parent’s generation—the men and women who bought starter homes and entered the workforce after World War II. They had good timing—the USA was entering a 30-year growth spurt in business and real estate.
They made and saved money, but the bulk of their retirement funds came from selling their homes. Places they’d bought for $10,000 or $15,000 in 1950 sold for 10 times more in 1980.
For every generation since then, the promise of that kind of retirement has been nothing but a big white lie.
The problem: Most middle-class American couples my age are trying to retire with an account in the $250,000 to $300,000 range.
And that’s where the trouble begins. To achieve a return of $60,000 on $300,000, you’d need a return of 20%. Getting 20% consistently over, say, 20 years may not be impossible, but it’s very difficult and risky—too risky for my taste.
Reeves’ Note: Mark says the biggest mistake retired people make is giving up all their active income. It’s a very common mistake… yet it’s never mentioned by retirement experts.
The good news is Mark’s developed a simple way to prevent you from ever falling into this retirement trap. It has nothing to do with stocks and bonds, but it is providing many readers two, three, and even four times the income of their Social Security checks. Click here to learn more.