Baby Boomer eBook

8/6/2019 Baby Boomer eBook

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Baby Boomer Blunders 1by Douglas R. Andrew

w w w . b a b y b o o m e r b l u n d e r s . c o m

Baby Boomer Blunders

Ten Financial Mistakes You Can Correct

Before Its Too Late

and retire in dignity

2009 by Douglas R. Andrew

www.missedfortune.com

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W ay s to connect

www.missedfortuneblog.com

Tune in to Dougs weekly Radio broadcast:

www.missedfortuneradio.com

http://feeds.feedburner.com/missedfortuneradio

Missed Fortune:

Isnt It Time You Became Wealthy?

Missed Fortune 101:

A Starter Kit to Becoming a Millionaire

Last Chance M illionaire:

Its Not Too Late to Become Wealthy

Missed Fortune 101 (Spanish)

Convertirte en Millonario

Millionaire by Thirty:

The Quickest Path to Early Financial

Books by Dougl as R. And r ew


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The Problem

Overcome Baby Boomer Blunders

If Only Baby Boomers Could See Things Differently

Blunder #1: Using short-term investments for long range goals

Blunder #7: IRAs and 401(k)s are the best way to save for retirement

Blunder #10: I think of retirement as a time to coast

Understand the Three Lodging Places for Money

Understand the Three Marvels of Wealth Accumulation

About The Last Chance Millionaire

About the Author

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I f w e take a la te r et i r ement and anear ly death , wel l j ust squeak by.

THE PROBLEM? The average Baby Boomer has less than

diminish their nest egg. The solution? Social Security isnt the

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cerned that they havent saved enoughthat they may out-

last their retirement resources. Many have seen their retire-

many are concerned that their nest eggs are draining faster

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layoff workers to cut costs during the recession. Still others

Is that en rio little too close o ome t get lau h

o tofy u?If so,youv got pl nt of comp y. hether

e eryonewi lha eeno ghmoney to retire isaquesti n

thatloo slargetodayf r 78m ll ion meric st eBa y

B omer bo n b tween 1946 and 19 4. Th crisi ? Most

B omer wil nothavee ough cc m l atedforret rement

tomeet eirnee s,l et lonethei r ants.


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former home. Many have witnessed that equity dimin-

house is not nearly as marketable as it was a few years ago.

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you having to work harder for your money. It wont matter

chance may indeed be your best chance to becoming a mil-

lionaire!


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Baby Boomer Blunders by Douglas R. Andrew


WH Y ARE MANY-

blunder for some is not squirreling away enough money dur-

bounty later on.

As m an y as 40 per cent hav e saved al m ost

nothing, one expert told a Congressional

panel recently. These people wil l not have

enough to meet their needs in their golden

y ear s, let a l one th eir w ant s.

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retirement savings.

to you?

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gone down in value.

I would love a vacation condo or cabinbut I cant af-

ford one yetIm waiting until I retire to buy it.

I have bought and sold investments at the wrong time.

I have not matched the right investment vehicles with

I have tried to time the market to get ahead faster. -

B A B Y B O O M ER OVERCOME

BLUNDERSBLUNDERS


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and values.

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vels of wealth accumulation.

all for.

blunders.

W hy Boomer s Are Laxabout Planning for Retiremen t

RAISED AFTER W ORLD WAR II, Boomers bring to

a nest egg away. They tend to have the attitude: If I want

worry about tomorrow when tomorrow comes. Having wit-

This false sense of security is the reason that it comes as

the mistakes of big business.

in an individuals unique skills and the ability to stay mar-

ketable.

The result is that older Boomers think it might be too late to

be enough time to save something. (In theory there is still

life; saving is not.


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non-essentials every single day and are cautious about their

William D. Danko documented the common money-saving

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the thermostat in the summer so the air conditioner didnt

have to work so hard (and cost so much!).

often have no clue where their money really goes.

If Only Boomer s Could SeeThings Differently

themselves.

Have you known someone who reacted to downsizing by

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tribute during their golden years. If they only knew how to

Those with determination and resilience are sometimes

that was a member of the Fortune 1000. Then came shrunk-


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but he walked around angry at the world. His marriage fell

him three years to come to the realization that he had not-

sess had become obsolete.

Anyone faced with such a situation can get frustrated.

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Blunder #1: Using short-term investmen ts for

long-range goals; and long-term investments

This may be the biggest mistake I come across in well-inten-tioned families.

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is not a great idea for your retirement nest egg.


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investments. It seemed to make sense because returns were

them for 2.9 years.

money out of what is really a long-term investment to buy a

Everybody commits this blunder at one time or another. Ill

show you that neither this blunder nor these other common

retirement.

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teen or twenty years after r etirem ent.

The fastest growing new segment of American society today

than they thought they would.

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cy for someone already age 65 was about another 12 years.

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might think: Ill be dead by then.


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even though they assured me they would be dead by now.And these are not even Baby Boomers!

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assumed that rarely would anybody live beyond age 95. As a

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already talk of increasing it to 140!

The problem wi th underest imat ing your own l i fe expectancy is you often underesti-

mate the amount o f re t i rement funds you

wi l l need to last the rest of your l i fe. The

r ea l i t y is, y ou w i l l l i kely need m ore m oney

than you th ink .

Blunder #3: I believe paying off m y house w ill

give m e peace of m ind.

when loans and mortgages were called due even though they

mortgage.


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able income if you are not writing a check each month to thebank. But theres a hitch. Uncle Sam offers that deduction

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Those w ho pay of f their m or tgage begin to

r ea l ize w i th i n a y ear o r tw o tha t they cou ld

use a new ta x br eak . They a lso di scover th at

by handi ng over a l l t hat m oney t o the bank,

th er es a l ot of l azy , idl e cash stashed aw ay

in th at pa id-of f house.

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down in value.

-self so that you dont

in mind that the money

you use for home mort-

-tion.

But what about leaving

the house to the kids?

you ask. Isnt that our

money. Those kids concerned about getting the house after


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Blun der #4: My $100,000 -$300,000 nes t

egg is going to be enou gh at retirem ent.

nothing. I have clients who start out thinking: Were set

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cent.

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Consider this. Even though half a million dollars may seem

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than by the golden goose.

Blunder #5: Ill be in a lower tax bracke t

wh en I retire.

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in deductions that you used to get. So you remain in the

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is less.

Blunder #6: Deferring taxes on retirement

funds saves me taxes.

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run out of money!


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Are you p lann i ng your r et i r ement

or Un cle Sam s?

Now what if you could set aside 100-cent dollars on the front

end and take out 100-cent dollars on the back end? Your

strategies wherein you can create a retirement fund using

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diebased on the same income distributions.

Are you p lann i ng your r et i r ement


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Phases of Retirement Planning

Contribution Accumulation Distribution Transfer

Taxed-As-Earned Investments

After Tax Taxed Gain Taxed Taxed

Non Qualified Tax-Deferred Investments

After Tax Tax Favored Gain Taxed Taxed

Traditional IRAs and 401(k)s

Tax Favored Tax Favored Taxed Taxed

Non-Qualified Alternative

After Tax Tax Favored Tax Favored Tax Favored

Home Equity Retirement Planning

Tax Favored Tax Favored Tax Favored Tax Favored

Blunder #7: IRAs and 401(k)s are the bestway to save for retirem ent.

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their contributions to IRAs and 401(k)s. When they start to

Uncle Sam now offers you another choiceRoth IRAs and

still too many strings attached.

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about IRAs and 401(k)s than you have received from your

K eep Your M i nd Open To The Possi bi l i ty

That Ther e M ight Be Sm ar ter Al ter nat i ves

Blunder #8: If I reach the a ge of 59 or 70and don t need m y IRA and 401(k) mon ey, Ill

just let it sit ther e.

have much more money if they let most of their money stay

there rather than transferring it out somewhere else. Post-

is the deadline before Uncle Sam starts charging you a big

until age 70 is a bad idea. Its like refusing to change the

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Most advisors also dont understand that you can strategi-

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strategic rollout. (For more information on strategic roll-

Missed Fortune 101.)

Blunder #9: I view retirement as a time for

of retirement. Wouldnt it be better to do the things you

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conservative attitude when they retire. They are afraid they

but have lost their good health and cant do the things they

you may lose the energy or the desire to go globetrotting and

to smell the roses along the way.

Blunde r #10: I think of retirem ent as a time

to coast.


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chises located all over the world.

celebrating our wedding anniversary every February in

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and today tens of thousands of gallons are made monthly

but his ice cream legacy lives on and is managed by his son

Michael.

assembling widgets. Start now to discover your marketabil-

a market for their hard-earned wisdom. I have a friend who

stress.

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being useful.


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or even a simmering talent for music or art that has been

on the back burnerthis is the time to share what you have

service for your church or a charitable foundation such as a

Uh-oh. I ve Done Ever y th i ng W r ong!

I W ont Be Able t o Cat ch U p.

that its not too late to learn how to make course corrections

and start navigating in the right direction. You can over-

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1. Understand the Three Lodging Places for Money

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their risk tolerance:

Low riskthe safest and most conservative and includes money

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Moderate risk

real estateboth residential and commercial. Most real

High riskand would include investments like growth mutual

funds. This category is generally viewed as having the

greatest risk.

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market conditions.

and earning an attractive rate of return.

-volved.

it wont matter. You can make money when your house goes

what your house once gained) if it goes down in value.

market. Your cash can be invested safely in conservative

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ment. You can have the best of both worlds: take advantage

When I invest my serious cash that is earmarked for my

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structures that house stocks (houses made of straw) and real

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without my money actually lodged there.

How can this be accomplished?

I also sock away money earmarked for retirement savings

into the same insurance contracts rather than into tradition-

al retirement savings accounts like IRAs and 401(k)s. In-

when the market goes down) by having my returns linked to

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York Times best-seller the week after it was released. To take

2. Understand the Three Marvels of Wealth Accum ulation

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retirement.


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The keys are:

weight

lift

thrust

drag

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more quickly than you may think. You can become your own

banker by doing what banks and credit unions do to amass

wealthborrow money at a lower rate and invest it at a

higher rate.

thrust force must be greater than or equal to the drag force.

lift

thrust

drag


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same retirement income stream.

Drag is the force of resistance caused by the body of the

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as a loan or a mortgage from a bank. To make your wealth

to wealth accumulation. If you read The Last Chance Mil-

H ow The Last Chance M i l l i onai r e W i l l H elp

in Your Ret i r em ent Planni ng

I know many of you are feeling the darkness of night as

to reveal the brightness of dayyour brilliant futurefull


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The Last Chance Millionaire will give you new direction. It

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do it now!

Aut hor Note:

some money accumulated in IRAs and 401(k)s and some

discretionary income each month to set aside for retire-

retirement income within ten years. Through case studies

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monthly cash outlay. The Last Chance Millionaire can give

income that can last as long as you do.

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About t he Aut hor-

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Wealth on the family balance sheet.

Documents

Baby Boomer eBook