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Wednesday, February 25, 2009
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.
The cyclical nature of the market is well known. We expect it to go up, down and sideways. However, if we were to graph it out over many years, we would normally see an upward motion, with periodic small dips. These days it's quite a different picture. The graph 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.
There are going to be literally millions of people selling off large holdings, because they have to. Can you imagine what that is going to do to the stock market. For the market to go up, we have to have more buyers than sellers. For it to remain the same, there would be about the same volume of sales to purchases. So, with way more sellers than buyers, the market is going to take a huge hit, and there doesn't appear that there is anything that can be done about it. I suppose it's possible that the Government will step in with another law allowing people to keep their money in their retirement fund longer. However, this will just delay the inevitable.
Most people understand that they are in a difficult financial situation, but they fail to realize the full impact. They are told that the best thing for them to do is to diversify, hold tight and ride out the storm. Many of them follow that advice and are unaware of what Warren Buffet said about this. He is quoted as saying ...."Diversification is a protection against ignorance. It makes very little sense for those that know what they are doing".
There are still a number of years to go before 2016 is upon us, so there is still time to get a handle on your finances and make some intelligent decisions. You need to educate yourself on financial matters and take action now, to secure additional funds to see you through your retirement. The experts tell us that one of the best ways to do this, is to have a home based business. It is predicted that many people are going to make their fortunes during this stressful economic time. There is no reason why you cannot be one of them. There are many great opportunities out there....find the one that appeals to you, take action 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.
The cyclical nature of the market is well known. We expect it to go up, down and sideways. However, if we were to graph it out over many years, we would normally see an upward motion, with periodic small dips. These days it's quite a different picture. The graph 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.
There are going to be literally millions of people selling off large holdings, because they have to. Can you imagine what that is going to do to the stock market. For the market to go up, we have to have more buyers than sellers. For it to remain the same, there would be about the same volume of sales to purchases. So, with way more sellers than buyers, the market is going to take a huge hit, and there doesn't appear that there is anything that can be done about it. I suppose it's possible that the Government will step in with another law allowing people to keep their money in their retirement fund longer. However, this will just delay the inevitable.
Most people understand that they are in a difficult financial situation, but they fail to realize the full impact. They are told that the best thing for them to do is to diversify, hold tight and ride out the storm. Many of them follow that advice and are unaware of what Warren Buffet said about this. He is quoted as saying ...."Diversification is a protection against ignorance. It makes very little sense for those that know what they are doing".
There are still a number of years to go before 2016 is upon us, so there is still time to get a handle on your finances and make some intelligent decisions. You need to educate yourself on financial matters and take action now, to secure additional funds to see you through your retirement. The experts tell us that one of the best ways to do this, is to have a home based business. It is predicted that many people are going to make their fortunes during this stressful economic time. There is no reason why you cannot be one of them. There are many great opportunities out there....find the one that appeals to you, take action and run with it.
About the Author:
Jan Shimano was District Manager for Health & Welfare Canada for a number of years. She was also self-employed as a Nutritional Consultant. She is presently a Business and Health Coach and operates her own internet marketing company from her residence in British Columbia. Jan also invites you to drop by and visit her on YouTube at www.youtube.com/1jinny
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