Is Diversification Going to Protect Me?
Not being an experienced investor, I have been very concerned lately as I watched my investments dwindling before my very eyes. I decided to do a little investigating with the hopes of coming up with some answers.
It has been my experience that whenever I am motivated to seek an answer to a question, that answer invariably appears, and so it was with my search. I had read Rich Dad Poor Dad by Robert Kiyosaki a number of times and found it very informative. A friend of mine recommended I read his book, Rich Dad's Prophecy, so I ordered a copy. That book was a major eye opener for me.
We are used to the market going up, down and sideways. That is it's cyclical nature. However, if we were to graph it out over many years we would see that the big picture showed a steady upward motion, even though there were small dips here and there. The graph these days looks very different and it's quite frightening for many people. It is headed down on a very steep curve.
The first of the 75 million baby boomers in the U.S. are going to be turning age 70 by the year 2016. The U.S. has a law on the books that states that when a person reaches age 70 1/2 they have to take all their funds out of their 401k. The time to pay 'Uncle Sam' will have arrived. Just think for a moment what that is going to mean.
In the not too distant future, millions of people will be selling off the mutual funds and shares they have in their 401k because the Government has told them they have to. The Government has been waiting patiently to receive their tax dollars and now their day will have come. This is a major disaster waiting to happen. Undoubtedly, there will not be enough purchasers to offset the massive selloff during this period of time. It is possible that the U.S. Government could amend the law, allowing assets to stay in the 401k for a longer period of time, but then they would be delaying receiving their tax dollars.
Most people already know that they are in deep financial trouble, but they don't realize the full impact. They are still being told that as long as they diversify, they will be fine. They are being told to sit tight and ride out the storm! I believe we are wise to listen to Warren Buffet when he states.... "Diversification is a protection against ignorance. It makes very little sense for those that know what they are doing".
We still have a few years before 2016 is upon us, so there is still time to get a firm handle on your finances and make some intelligent decisions. Educate yourself on financial matters and take action now to accumulate additional funds to see you through to your retirement and beyond. The experts tell us that having a home-based business is the best way to do this. The prediction is that there are going to be millions of new millionaires created during the next 10 years. You can be one of them...there are many great opportunities out there....find the one that resonates with you and run with it.
It has been my experience that whenever I am motivated to seek an answer to a question, that answer invariably appears, and so it was with my search. I had read Rich Dad Poor Dad by Robert Kiyosaki a number of times and found it very informative. A friend of mine recommended I read his book, Rich Dad's Prophecy, so I ordered a copy. That book was a major eye opener for me.
We are used to the market going up, down and sideways. That is it's cyclical nature. However, if we were to graph it out over many years we would see that the big picture showed a steady upward motion, even though there were small dips here and there. The graph these days looks very different and it's quite frightening for many people. It is headed down on a very steep curve.
The first of the 75 million baby boomers in the U.S. are going to be turning age 70 by the year 2016. The U.S. has a law on the books that states that when a person reaches age 70 1/2 they have to take all their funds out of their 401k. The time to pay 'Uncle Sam' will have arrived. Just think for a moment what that is going to mean.
In the not too distant future, millions of people will be selling off the mutual funds and shares they have in their 401k because the Government has told them they have to. The Government has been waiting patiently to receive their tax dollars and now their day will have come. This is a major disaster waiting to happen. Undoubtedly, there will not be enough purchasers to offset the massive selloff during this period of time. It is possible that the U.S. Government could amend the law, allowing assets to stay in the 401k for a longer period of time, but then they would be delaying receiving their tax dollars.
Most people already know that they are in deep financial trouble, but they don't realize the full impact. They are still being told that as long as they diversify, they will be fine. They are being told to sit tight and ride out the storm! I believe we are wise to listen to Warren Buffet when he states.... "Diversification is a protection against ignorance. It makes very little sense for those that know what they are doing".
We still have a few years before 2016 is upon us, so there is still time to get a firm handle on your finances and make some intelligent decisions. Educate yourself on financial matters and take action now to accumulate additional funds to see you through to your retirement and beyond. The experts tell us that having a home-based business is the best way to do this. The prediction is that there are going to be millions of new millionaires created during the next 10 years. You can be one of them...there are many great opportunities out there....find the one that resonates with you and run with it.
About the Author:
Jan Shimano was District Manager for Health & Welfare Canada for many years. She was also self-employed as a Nutritional Consultant. She is presently a Business and Health Coach and runs her own internet marketing company from her residence on Vancouver Island. Jan also invites you to visit her on YouTube at www.youtube.com/1jinny
posted by Credit Counseling at
12:39 PM
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