Big news! Studies show, on average, my generation, the Baby Boomers, haven’t saved enough to retire at 65.

They don’t have anywhere close to enough money to maintain their lifestyles.

Really?

I hope whoever sponsored the study didn’t spend a lot of money for it.

This is the generation who’ve bought all the toys—on credit.  And now they don’t have enough saved up?  No kidding!

Yet, I say terrific!

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The dream turned into a wakeup call.  My first year as a financial consultant I netted $10,000.  A little short of my goals.  With a family of four and two kids heading towards college this was a setback of major scale.  We had saved, invested and planned before launching but still this was worse than I ever imagined.

The biggest obstacle was self imposed.  I wanted to build a fee based advising and planning business.  By doing this I collected a small quarterly fee rather than a much larger commission.  I wanted to build a business with a long term focus.  Help people plan their financial futures while reducing the potential conflicts of interest.

In the short term it meant giving up 80 percent of my income.  In the long term it meant building a scalable business that could grow exponentially.

Many of the veteran brokers told me, “You’re crazy.  You can’t build a business like that.  You’ll never survive.  People won’t go along with it.  You’re a fool.” Read More→

Steve Cohen, “The Millionaire’s Magician,” became an overnight success.  Really?

As a child he was intrigued watching and performing magic tricks.  He had natural talent and unbounded interest.

He says, “While other kids went to soccer and football camp during the summer I went to geeky magic camp.”

No doubt growing up he probably wasn’t the big man on campus.

He performed through college, perfecting his skills and earning a living.  After graduation he married a Japanese woman and they moved to Tokyo.  There he connected with the general manager of a large hotel.  After a private showing he gained a contract to put on magic shows.

He eventually returned to the US and set out to be a career magician.  But how do you break into the big time?  The field was already crowded with headline performers.  And how do you make contact with the people you need to?

He would do small preview shows for agents to get contracts.  Then start all over when it ran out. Read More→

About four years ago, in the midst of the real estate boom, I was advising a friend on her finances as we sat in my office one afternoon.  She’s a little older than I am and retired.  That’s her dream.  No more work.

The problem is she doesn’t have enough money to sustain her life style through decades of retirement.

I said to her, “You need to sell your house and move into something smaller.  Then invest the extra to generate income.  This will reduce your living expenses as well.  Help you get your cash flow in balance.”

She answered, “But this is my dream home.  It’s what I’ve always wanted.  I just couldn’t sell it.”

“But you’re going to run out of money before you run out of retirement,” I replied.  “You’ve got to change something.” Read More→

Last week we passed a stock market milestone.  We reached the level prior to the bankruptcy of Lehman Brothers in the fall of 2008 and the entire subsequent meltdown.

The crash was set up by a generation of people, most of whom have not saved enough to enjoy a retirement close to their normal lifestyle.  So rather than save more or cut back they came to the gaming table one more time and this time threw snake eyes.  Tech stocks had blown up in the 90s.  So real estate had to be the answer.  After all, as was said, “You can’t lose money in real estate.”

People borrowed money on terms, that when reset, they couldn’t afford to buy houses that were overvalued.  Then some brilliant MBAs figured if we package up these loans and sell them as investments it will reduce the risk.  Huh?

When everything collapsed by early 2009 there was an incessant screech from the news media predicting the end of the world as we know it.  We were in a “Black Swan” event.  We faced the “Hindenburg Omen.”  A “double dip recession” or worse “depression” lurked around the corner.  Conspiracy theories poured out from writers who had uncovered secret plots to destroy our country. Read More→

“I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.” Warren Buffett

We’re experiencing the third full-blown investment bubble since I became a financial adviser in 1997. In the late 90s we had the “tech bubble,” the early 2000s the “real estate bubble,” and now the “bond bubble.”  Investors are so afraid of stocks they’ve pulled money out in record amounts over the last two years and sunk it into bonds, particularly US government.

I recently saw a chart which compared cash flows into investments.  The chart was the mirror image of the late 90s.  Then cash flowed into tech stocks in massive amounts with miniscule flows into bonds.  Now the chart is the opposite with record flows into bonds and huge withdrawals from stocks.  The bubbles look identical just the reverse investments. Read More→