Pam Poundcake decided to retire in the winter of 2022. She’d enjoyed a rewarding career managing a fortune cookie factory for forty years. In 2021 there was a strange incident. During a standard quality fortune check, she opened a cookie that read, “It’s time to retire. You’ve made fortune cookies long enough.” That is a really long fortune, Pam thought to herself. And specific. Luckily, Pam made the fantastic decision to start investing at a young age into her 401k. She also made the smart move to put 100% of the money into the stock market. Of course, Pam should have increased that contribution throughout the years but she never got around to it. Yet, her $200 a month contribution into her 401k, which she started at age 22, had blossomed into over a million dollars. Pam’s coworker, Penelope, hadn’t saved for retirement at all and desperately tried to catch up in her fifties. Penelope saved $1000 a month from age fifty to sixty-two using the same investment strategy as Pam. After forty years of work (and twelve years of investing), Penelope ended up with around $250,000. Wow! Pam exclaimed to herself. I’m sure am glad I listened to my parents to start saving early. She put in her notice, and a month later she found herself embarking on a new stage of life. She finally took the time to sit down and really examine her finances. My Social Security will be around $1800 a month. There is no way that is enough to pay the bills, thought Pam. For the first time, she really started to study her portfolio. Even though she had invested into her retirement accounts for forty years, she never made any adjustments or paid any real attention to pull-backs in the market. (smart) Now Pam felt a sick feeling in her stomach. I’m not making an income anymore. I have nothing to fall back on. If these investments crash, I don’t know what I would do. Pam started looking into her options. This is crazy, she thought, I have no idea how this stuff works. I just never took the time to educate myself while I was working. Pam found herself at the same crossroads as most retirees. She never thought about her 401k until her income stopped. Suddenly she felt the need to make quick, defensive moves. Why did she feel to need to make such a big move so quickly after retirement? There is no ticking clock. You can keep your money in your 401k as long as you like. But there is no denying it: once your paycheck stops, the importance of your investments and savings magnifies significantly. I’ve seen this story play out time and time again. Most people don’t give much attention to their 401k until they retire and then they pay a lot of attention. If Pam had successfully invested for all of those years, why is she suddenly trying to reinvent the wheel? Pam started looking around for retirement investing ideas. Pam sat down with a broker to talk about some insurance products that protect your investments. “Pam. The markets, long term, will be fine. But what if, in the first couple of years of your retirement, the markets crash? That throws off the whole calculation. If you need money early for retirement income, and the markets are temporarily down, it is almost impossible to recover,” he pointed out. (not true) “Do I have the product for you,” he proclaimed. “This product is guaranteed.” It sounds so good. It is such a compelling story. Except that the logic behind the sales pitch is misleading. If you take five percent of your portfolio each year, even if the stock market has a couple of bad years right away, it will not bankrupt you. It will not affect your long-term security. Market downturns recover so quickly and overall, stocks will do well. These fancy products have at least three or four times the fees. There are steep penalties unless you stay there for 7-10 years. I see this all of the time. Unsuspecting retirees meet with brokers that throw around the word “guarantees” like it is going out of style. So Pam buys an annuity. Five years later her friend introduces her to a friend who is a financial planner. “Pam,” he says, “This kind of annuity is no good. I have a financial product that is even better at protecting your money.” So Pam pays all kinds of penalties and ends up with a product that is (probably) even worse. Three years later Pam gets frustrated with the abysmal returns of her new product. She goes to another financial advisor where she finally gets good advice. “We are going to take you out of these expensive, restrictive products and put you into a diversified portfolio of stocks and bonds. There is nothing I can do with this money until you get out of this thing you were sold. You are going to have to pay more penalties. There really is no other way,” he told her correctly. So she paid more fees back to the company who issued the old product. Five years after that, her fiduciary advisor retires. Now what? Pam sighed. I finally found a guy I liked. So the whole process starts again. She ping-pongs around different advisors and ends up in a worse position than before. Think about all of this for a second. How in the world can you navigate these choppy waters for twenty or thirty years? Think about how many people will take advantage of Pam. It never ends. She has no chance. Will you have good financial discernment when you are 82? or 92?? The salespeople will never stop knocking on your door. It really is a difficult situation and I wish I had a good answer. There is so much money to be made by financial institutions. They will churn your money as much as possible. They will make so much noise that you won’t know whom to trust or what to do. I usually try to write uplifting articles, but the forces I am battling are unbeatable. They just have too much money for me to have a strong voice. So, please, read these newsletters each week, give your friend my book, and ignore everything you hear on TV. Those are your best weapons against these people. You can do it! Be Blessed, Dave | 
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