Dave Kennon: Half the Country is Fine

Thumbs up for the markets - Dave Kennon

Dave Kennon, Kennon Financial

Quick Market Update:

Remember how December was the worst month in the markets in ten years? Remember the doom and gloom headlines? Remember how some of you looked at your statement and felt a little sick?

In January, the markets went straight up. In fact, it took one month for the markets to mostly recover. Please try to get your brain to remember this lesson. Bad months will happen. Bad years will happen. Markets temporarily go down and permanently go up. Investors who panicked and sold last month paid a severe price.

Half the Country Is Fine

Some of my detractors often point out how many Americans are utterly unprepared for retirement. They point out that many Americans die with no financial assets at all.

In fact, the Massachusetts Institute for Technology published an article referencing a study at Harvard University. The headline:

Study: Many Americans die with ‘virtually no assets.’(source)

The study included home equity and pension benefits and social security. We’re not just looking at retirements accounts.  The median retirement savings for a worker in their 60’s is around $200,000.

But as you continue to read the data in the study you find something interesting. “The median wealth for married senior citizens, roughly a year before they died, was more than $600,000.”

Wait. What?

The “median” is different from the “average” (put your junior high math hat on). The median means that for every person who possesses more than $600,000, another has less. There are just as many people with $600,000+ as people with less than $600,000 in total assets.

Think about that!

Are “Many Americans Dying With Virtually No Assets”? Yes.

Do we need to do whatever we can to help them? Yes.

But what about everyone else?

The Retirement Revolution’s singular purpose is to make your retirement as awesome as possible. How does it work? You first unlearn some common misconceptions. You may soon realize that it’s is okay to start spending a responsible amount of your savings each year as soon as you retire.

Not only do most people worry about their retirement finances for no reason- they may be able to spend more money than they realize.

I understand why the mainstream media focuses on the worst-case-scenario-retirements. Attention must be shone on those who need help.  But this incessant negative messaging has given America the impression that there’s a retirement crisis in this country.

There is no retirement ‘crisis’ in this country.

The Center for Retirement Research at Boston College calculates… 52% of working-age households in 2013 would be able to maintain their pre-retirement levels of consumption once they stopped working.(source)

Do you know what that means? Half of all Boomers will be able to live the same lifestyle retired as they did while they were working.

You may be able to spend the same amount of money retired, as you did while you were working.

I’m sorry. That is just incredibly amazing news.

You will not outlive your money. You will not become a burden to society. In fact, For many of you, maybe the bigger mistake is to not take advantage of the time you have now. Maybe you can spoil yourself a little more, become more generous, and start living your new empowered life.

That’s what The Retirement Revolution is all about. Stop Living Scared. Stop Dying Rich.

Have Fun. You’ve Earned It.

Be Blessed,

Dave Kennon, Kennon Financial

There is no certainty that any investment strategy will be profitable or successful in achieving your investment objectives. An index is a portfolio of specific securities. Indexes are unmanaged and investors cannot invest directly in an index. Index returns are “total returns” with dividends reinvested, which means the return is not only the change in price for securities but any income generated by those securities. The performance of an unmanaged index is not indicative of the performance of any particular investment. Investments offering the potential for a higher rate of return also involve a higher degree of risk. Past performance is no guarantee of future results. Actual results will vary.
The return of principal for bond funds and for funds with significant underlying bond holdings is not guaranteed. Fund shares are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings.
The value of fixed-income securities may be affected by changing interest rates and changes in credit ratings of the securities.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. Indexes are unmanaged portfolios and individuals cannot invest directly in an index. Actual results will vary.
This communication is for informational purposes only and nothing herein should be construed as a solicitation, recommendation or an offer to buy or sell any securities or product, and does not constitute legal or tax advice. The information contained herein has been obtained from sources believed to be reliable but we do not guarantee accuracy or completeness. Do not act or rely upon the information and advice given in this publication without seeking the services of competent and professional legal, tax, or accounting counsel.
Share this Post:

Leave a Reply