Dear FutureMoneyTrends.com Member,
The very idea of retirement is still new, only in the past 100 years, and really only in the last 50, has anyone even seen it play out.
I personally have come out hard against the 401k system, high fees, we don’t know the tax for withdraw, and I hate that it has conditioned people into thinking Wall Street is the only way to invest and grow your capital. Recently, we made a high quality micro-documentary called, “The 401k Scheme;” you can watch it by clicking here.
My real issue with retirement though is the idea itself, I think people have set themselves up for failure. It’s almost like peer pressure to not work after you turn 65, as if you are a loser if you are working at age 75, which I think is just not the truth.
Look at guys like Warren Buffet or John C. Bogle, both of these gentlemen are highly successful and happy to work everyday in their 80‘s doing what they love. Even if you did retire officially, what’s wrong with having a part time job or a side business.
Building wealth and monetizing your passions is a much better plan than the current conventional model of retirement. Here are some startling facts recently mentioned in the PBS Frontline documentary, “The Retirement Gamble.”
- 50% of Americans can’t afford to save money for retirement
- 1/3rd have ZERO saved!
- $18 billion in Wall Street bonuses were paid out in 2008.
- 63% of your wealth is eaten up in fees over 5 decades.
- Average family will pay $155k in fees to a 401k plan.
- 79% of mutual funds don’t even beat the S&P 500.
Do you know that the person who cuts your hair has to go through more schooling then your average financial planner? Financial advisors are typically commission based, think about that? These people have a major conflict of interest…
Yet, 60 million Americans have entrusted their hard earned savings to a 401k plan, managed by a multi-layered group of people who all work off of a commission. You take on all the risk, and they compound their own wealth every year with fees.
Throwing names at the public like “Balance Fund” and “Growth Fund.” Seriously, who doesn’t want those funds? Is there an unbalanced shrinking fund I can sign-up for? The names for these funds give the impression of a guarantee and certainly a sense of comfort.
Sorry for pounding the table on this one, but I think the issue of retirement has skewed the process of wealth building to the point where it is making people poor both in the literal sense and in their mindset and how they view themselves.
I don’t like seeing people feel horrible about themselves because they don’t have enough saved for some arbitrary date that they believe they need to quit doing whatever it is they do for active income.
My advice is to forget about retirement and focus on building wealth, cash flow, businesses, and partnering with others who can become part of your long-term wealth strategy.