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“Know Your Financial Ball Game…

Playing to Win in Your Own League”

You may dream of playing in the big stadium, with potential double digit earnings, and the brokers tell you should be doing this so you don’t outlive your income or lose pace with inflation.  But the amount you need to invest is not major league levels that can afford the hard “breaking curve balls” the market pitches. But your Broker continues to get his fees.

No one cannot hit a 98 mph fastball with a little league 28 inch / 28 ounce baseball bat; it breaks every time you make contact with the ball or someone could end up seriously hurt.   Unless of course, they get dangerously lucky, or have the skill to time the pitch with precision contact, laying down a perfect bunt.  And as baseball fans all know, a “bunt” usually always leads to an out for the batter.  But the base runners or “stock brokers” usually always advance to the next base safely along the way with their “management fees” whether the batter is safe at first or not. Investors, especially in their retirement years, must learn their game skills and limititations and which “league” they should play in.

Risk tolerance is frequently always misdirected by brokers when investing their client’s assets.  They believe that by simply diversifying portfolios in multiple investment markets the consumer is safe.  What’s the likelihood of all market sectors going down at one time they ask.  Remember the DOW was at an all time high in October 2007 at over 14,000. By August 2008 it was just hovering over 8,000 mark, and eventually at less than 7,000 by March 2009.  In 18 months the market lost over 50% and investors were stunned. Indeed it was the worst economic catastrophe since 1929. The market has come back and is now beyond the 10,000 mark. But for how long and what was driving this current growth?  It is certainly not the auto industry, or the banking industry, and definitely not housing sales.  It was the CPR (cardio pulmonary resuscitation) that the federal government provided to the economy in the form of increasing federal debt, through bailout programs, lending and frivolous spending programs, all supposedly designed to create more jobs.  This was supposed to keep key economic sectors from collapsing under the weight of their overvalued stock, financial responsibilities and debt.

The point is, does the retired investor in the market have the time for recovery associated with the risks of Wall Street, in our current economy? Sure if they can they hit a fastball at 98 mph, which is the equivalent to having a few extra hundred thousand in their portfolio that they can patiently utilize, watching it go up and down while they are striking out or hitting a weak pop fly. 

All they have to do is wait a couple more innings until they get their next turn at bat, to see how the market goes.  But if they strike out again, they may only get one more turn at bat during that game, and they may not get a hit, and their batting average drops significantly. The fact is that at the age of 65, you don’t have that many full games left in your lifetime, and you need to make every time at bat count. It means getting on base with singles and walks whenever possible to score runs.  That game plan in baseball is called playing “small ball”. If you do all the basics of the game right, you will stay in the close games and usually win games by one or two runs. But trying to play a high scoring power game, hitting a lot of home runs, with extra base hits like doubles and triples can waste a lot of good opportunities at bats by just swinging smooth and steady for singles or patiently taking walks.  If you can’t run full out after you hit the ball, and slide head first you won’t hit many doubles or triples.  In other words, there are not many over the age of 65 that have that speed, or power in today’s economy to take the risks of trying to swing for fences, trying to score with the double digit gains.

Too frequently, we find investors loading up the bases for the other team to score runs, instead of their own. They buy the wrong investment products, with unnecessary fees and risks of loss, forcing them to them to the bench to wait it out to see if the market comes back.  Take the time to allow “Our Team” to just look at your current game plan, to let you know what risk it may impose if any. Call or email our offices to schedule a simple 30 minute “no sales” telephone conference. We will educate you if needed to only safe, secure and predictable alternatives to help you score more runs in the current market by “playing to win in your own league”.                                

Brian D. McGann, CEO

MedicareSaver Solutions, LLC

Certified Special Care Planner

Office Phone 321-939-0999