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December 30th, 2011 by

Protecting Your Retirement Nest EggIn this post, I’d like to discuss something a lot of you probably worry about on a regular basis: outliving your retirement fund. Rather, worrying that your retirement fund won’t last through your entire retirement. This is especially a problem if you are counting on a pension to carry you through. As the social security administration threatens an impending collapse of retirement and disability benefits, some economists have pointed out that many institutions are obligated to pay out pension and retirement funds that simply don’t exist. For whatever reason, these financial institutions overextended themselves.

The blame for social security woes could be put on any number of shoulders, from past presidents to congress members to the secretary of finance. Looking into the matter, you’ll probably discover that social security actually maintained an excess of funds throughout much of its life. Unfortunately, those funds were turned into government bonds early on and, with the greatest national deficit in the history of the United States, the money exists only as numbers on a ledger. The money was spent years ago! Now, when the government has to pay back the funds they borrowed from the social security fund, they complain that it’s putting a great strain on the nation’s finances.

I may be a little disillusioned by all of this but one thing is made clear in light of these facts: if you want a comfortable retirement, you shouldn’t depend on social security or a pension. If you’re a baby boomer, a financial planner can probably turn your nest egg into a sizable retirement fund. If you’re on the younger end of the boomer spectrum, it’s never too late to start saving. If you have a decade or two before retirement, CDs are a great way to earn moderate interest without risking your nest egg. Also, well-chosen stocks can dramatically increase the size and purchasing power of your nest egg.

Learn More At My Next Seminar
Learn more about protecting your retirement years at my free seminar “Avoid Cracking Your Nest Egg on January 10, 2012 or January 12, 2012 at Blue Dolphin Seafood Bar & Grill  in Maryland. This is an exclusive seminar with powerful knowledge to help you with your financial portfolio.

You must call ahead to reserve your seat. Tel : (301) 627-0123.


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December 13th, 2011 by

The Need for Life InsuranceI’d love to live in a world where there’s no risk of being sued. A world where everyone gets along and there are no money hungry people looking to drain you of your resources at any moment. Unfortunately, experience paints a different picture. Some people have made millions slipping in grocery store parking lots or capitalizing on a minor car accident. The justice system here in America is one of the best in the world but when someone can take away your home, your car, and all your savings, there’s something drastically wrong.

The risk is certainly out there. All a person has to do is slip on your sidewalk and you can find yourself facing a hefty lawsuit. It’s the way the world works and, while it’s not perfect, there’s little we can do to change it. What we can do, though, is protect ourselves as much as possible. That means getting insurance, keeping in touch with a good lawyer, and doing everything you can to limit your liability when driving your car or sitting in your home.

When you go out, drive carefully. If you’re having any trouble with your vision, don’t drive until you see an optometrist. Maintain your home so that the chances of someone being injured while on your property are at a minimum. The point I’m trying to make: don’t invite trouble. Even when you’re careful, lawsuits can still pop up at a moment’s notice. What can you do about it? Get liability insurance. Now, you’re probably thinking, “Why should I pay an arm and a leg for insurance to protect me from something that may never happen?”

Getting insurance is like putting a lock on your door. Depending on where you live, there may be very little chance that someone will break in. Still, the risk is too great to NOT do anything to protect yourself. Rather than putting your nest egg on the line, it’s just a good idea to get insurance.

December 8th, 2011 by

Rainy Day SavingsProbably the biggest stumbling blocks that people encounter when trying to build an income for life is emergency expenditures. You don’t want to use your retirement fund as an ATM machine. So many people work hard to establish a nest egg that will carry them comfortably through retirement only to lose a good portion of it when an emergency comes up. Dipping into a retirement fund for things like emergency medical procedures, the death of a loved one, or other unexpected expenses can put you in a vulnerable position. If enough expenses come up, you can find yourself in a position where you have to return to work or depend on a child to survive.

Now, there are a couple of things you can do to protect yourself. First, get as many insurance policies as you possibly can. Life insurance, health insurance, property insurance – these will help you weather the storm without dipping into valuable retirement money. If a natural disaster strikes or someone gets injured on your property, good property insurance is your best protection. If you or your spouse is facing a medical emergency, health insurance will cover much of the cost. Life insurance, of course, can cover the cost of the funeral and provide additional resources that can help the spouse or children. That being said, insurance does come at a cost.

Another approach you can take is to build an emergency fund. Experts suggest building a cash cushion equivalent to six months of living expenses and placing it in a savings or other fairly liquid account. It’s important to have instant access to these funds in the event of an emergency. The larger the emergency fund, the better protected you will be. If you’re a younger boomer and believe that retirement is years away, an emergency fund can give you time to get back on your feet if you suddenly lose your job. If retirement is just around the bend, the fund will help keep your retirement fund safe.

December 6th, 2011 by

Spur Economic GrowthIn this post, I’d like to discuss some of the problems standing in the way of economic growth. US home prices have declined 33% since they peaked in 2006. In fact, most homeowners have seen property values drop further and faster than they did during the great depression! In past recessions, the housing market was credited with boosting the economy because new homes require the hiring of individuals for construction and older homes require a number of goods and services before new homeowners are able to enjoy it.

During this recession, though, the housing market is having a major impact on economic recovery as a whole. As it struggles to regain its footing, the US economy is experiencing slower than expected growth. While previous recessions enjoyed around 15% of growth from the housing market, it has only contributed to about 4% of the national GDP. So, why is the housing market dropping the ball this time around?

It’s estimated that 4.5 million homes are either 3 months behind on their mortgage or have officially entered foreclosure proceedings. Compare that to the historic average of around 1 million homes in this predicament and it paints a pretty clear picture: until these foreclosure properties are cleared out, our nation cannot recover fully. Unfortunately, the high unemployment rate, slow lender reaction time, and a reluctance to negotiate with defaulting homeowners is making the problem worse with each passing day.

Can anything be done to fix this terrible housing crisis? Not directly. Still, over time, modest broad economic growth may be able to pull the housing market back on its feet, which in turn will spur greater economic growth. It will take time for the housing market to recover, and until that happens our economy won’t be as strong as it has been in the past.