Episode #23: Three Major Retirement Risks


The Principle:

When you retire, you need to keep your money safe. However, there are always threats to your financial stability. Brian covers three major retirement risks.

(Click the featured times below to jump forward in the episode)

Honest Takes:

[00:15] – Three Retirement Risks.  

  • According to US News And World Report, there are three main retirement risks to be aware of. They include market risk, sequence risk, and inflation.

[00:30] – Market Risk Can Destroy Your Portfolio.  

  • When you think of various retirement risks, your mind probably gravitates toward market risk. After all, a market crash can destroy your portfolio. That’s why a “buy and hold” mentality can get you into trouble. Instead, Brian suggests you need an exit strategy for your money as you approach retirement.

[1:50] – You Need A Succession Plan For Your Business.

  • Let’s be honest, none of us are going to live forever. When you retire, and when you die, you need a succession plan for your business. Whether you’re selling your business or passing it on to your children or a spouse, you need a plan for passing on your business to the next generation.

[2:04] – An Example.

  • Brian uses his own business as an example to illustrate the importance of having a succession plan.

[2:45] – Defining Sequence Risk.

  • It’s expected that you’ll withdraw some amount of money as income from your retirement accounts. However, the market fluctuates, and if you’re withdrawing during a down market, you’re essentially selling at the bottom, and your assets are worth less as a result. Furthermore, as your overall net worth drops, the withdrawals you’re taking will represent a greater percentage of your wealth.

[4:32] – The Hidden Tax Of Inflation.  

  • Inflation is a sort of secret tax the government uses to boost the economy. If you’re not careful, inflation can eat away at your retirement portfolio.

Today’s Truth:

Other Virtues:

The host: Brian Bowen – Contact

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