Here we are again, well into the fourth quarter of the year. It's been a crazy volatile year so far, and quite frankly I think we can anticipate more of the same next year. That leads me to what I want to discuss in this month's newsletter. October was a ridiculous month for investors with wild gyrations in the market, and obviously that makes a lot of people nervous. So, this month we're providing our readers with two AE Wealth Reports that address market volatility. These articles address what to do with invested assets, but I'd like to add my own view on retirement planning diversification. For those of you that are already JDS clients, you probably already know what I'm talking about. But for those of you that are not clients and still get our monthly newsletter, I'd like you to consider what I have to say. It's backed up by a twenty-year track record of success, and is well worth considering.
When I speak about "retirement planning diversification", I'm not just talking about having a well-diversified investment portfolio. Bottom line is this, if you're investing, then those assets are exposed to market risk. Diversification can lower your risk, but it can't get rid of it! Sorry folks, that's just the way the investment world works, and that can't be denied. So, what is true "retirement planning diversification"? In my view, it's not only diversifying your investment portfolio, but also diversifying your product choices. As we grow older, a certain amount of your assets should be guaranteed safe, in my opinion. These assets should provide things like stability, guaranteed lifetime income, reasonable liquidity, and even long-term care benefits.
To meet those goals, we need to educate folks on how to use banks & insurance companies. Everybody needs a certain amount of liquidity & safety. This is where we recommend using your local bank for savings, checking, CD's, etc. Insurance companies should be used for guaranteed insurance contracts, commonly known as life insurance, long term care, or annuity planning for safe growth and guaranteed income. It's vital in my opinion to have the right blend or diversification using all of these financial institutions in the right way to meet your retirement goals. No one strategy can do all things, so as a fiduciary it's our responsibility to know where each institution should be used.
There are numerous studies that have been done by renowned retirement analysts that bear this out. I'd be happy to forward the studies to anyone that would like to review them. All you have to do is let us know.
If you would like to discuss how some of these strategies might work as a part of your own retirement plan, if you'd
ke your own
Chart Your Course Retirement Review
, or a second opinion on your current retirement plan, then just let us know.
And, as always, remember -
The purpose of the money dictates where you put it.
Until Next Month,
James D. Stillman
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