Planning for a long, fulfilling life

We’ve almost made it through the first quarter of 2018. Hopefully, you have spent time developing a "decision-making process” that does not go to a default button established by someone else. Rather, you’ve designed a process that will help you make good decisions moving forward in your life.  Hopefully, you have also developed a few "Dreams" that can be measured in nature and economics.

I saw some interesting data recently. According to Bloomberg, almost half of Americans age 75 and older hold some equities, this is up from 40% of Americans in this age group in 2007.  The top group of equity owners is age 55 to 64 - at 58%.  It would seem to me that these groups would be the most conservative, being that they’re retired or close to retirement. In fact, the reverse is true.  

As we know, equities have had the larger growth numbers over the years, but also the dramatic volatility that produces what I call the “Rolaids Moment.” Over the Holidays, I had the opportunity to talk to my children about investing and found some interesting insights.  One comment was, “We are investors from the recession.”  They entered the workforce ten years ago, started investing in their 401(k)s, and saw a fifty percent loss – Oh boy, might need a Rolaids.  

As well as the market has done recently, we still remember the “Rolaids moment” of 2007 and 2008 - and last month. Interestingly, just prior to the “tech bubble reversal” in early 2000, young investors referred to this as investing in “The New Economy.” They thought things never go down in value. But they lacked experience and perspective that comes with age – and a few Rolaids moments.

John Grable of the University of Georgia says older investors do not deserve the reputation for being cautious and risk-averse. They often have more knowledge and experience and a wider perspective. We have to help each other understand the long perspective of investing, patience, and time. It is not a decade perspective - it is a lifetime perspective. You could say many older investors have developed an iron gut.

It is important to remember, Dreams (especially the big ones) take time and patience. It can be especially true for younger people. They want to start living now and take advantage of their youth. But some dreams take longer than others. Some are more challenging. Some dreams need to be redefined from time to time. But they all start on Day One - the day you commit to it.  I have asked many of our mature clients, “How did you do this?”  They say, “Not sure. Just planted the acorn, sat on it, worked hard, and was patient. Next thing you know, we are on top of a huge tree – and the view is great.”

They also said, “Growth and comfort do not always go hand in hand.”  My favorite economist tells me, “volatility and uncertainty create wealth – successful people know how to weather the storm.” Fear can create inertia. Inertia chews up valuable time. Get the ball rolling and keep it rolling. In other words, stay motivated.

“People often say that motivation doesn't last. Well, neither does bathing - that's why we recommend it daily.” – Zig Ziglar.

As we mature, it is fun to see the long-awaited dreams come to reality – traveling with your spouse, spending time with grandchildren, and seeing how great your children turned out (fortunately they took after their Mother) and how wonderful they are as parents.  

"Choice" is a learned skill.  Let us coach you through it.  Let us help you turn your purpose-driven dreams into purpose-driven plans. Remember, this is the year we make the important things urgent.

My Grandfather told me, "I've been rich and I've been poor – rich is better."