When losing 99 to 3 is a good thing!

This is one game I'm not ashamed to lose.

The other day I get a Fisher Investments solicitation in my email inbox. The subject lines are meant to entice and I was game so I read a bit further. The gist was...

99 Retirement tips that would revolutionize your retirement plan.

It was very impressive, but also very overwhelming! If there is one thing I've learned in my travels, it's that the overwhelmed mind doesn't take action. Planning for retirement is hard enough! It's confusing. Can be hard to understand.

So I like to keep it simple with just 3 tips. (They're good ones!)

1) Create more income

2) Reduce investment volatility

3) Use cash efficiently

By the way, if you've seen me speak or teach, you will recognize these 3 items as the main components of the SECURiMENT method. What is SECURiMENT?

SECURiMENT is happiness equity. It's peace of mind. It's security, both now and in retirement.

Let's hit these 3 variable in more detail.

1) Create more income

We live on income in retirement. Social Security. Pensions. Annuity payments. Dividends. NOT ASSETS. You may know that pensions used to be much more prevalent. Then the 401K came into existence. Now, people are left to their own devices. If you don't have a pension plan, you must buy one.

2) Reduce Investment Volatility

There comes a time when volatility is no longer a good thing! Between 2005 and 2012, the average rate of return of the S & P was 4.9%, but the drawdown risk was 55%. From top to bottom the S & P fell 55%. That’s too much risk. Because when markets drop sharply, the average investor is incapable of the holding part of “buy and hold” and It’s short term moves that ruin long term retirement plans.

3) Use cash efficiently

Tax rates are currently at all time lows so converting tax-deferred assets and re-positioning to tax-free investments may be prudent. Having a plan for maximizing, rather than reducing, your social security benefits is a must. And, although it is not always possible, taking action to determine how you will be cared for (later in life) and how that care will be paid for, will insure your happiness both now, and later in life!

I realize it's more complicated than just 3 variables, but here is what I've seen work really well in practice. If you choose one way to improve your situation from each category, you will be very well served.

It's never a good time to take action. Life is hectic and there’s never going to be an ideal time to take action and the status quo, or staying the way you are, is so incredibly warm and comfortable. But there are many ways to run into a secure and comfortable retirement, but doing nothing is not one of them.

That's just the way it works!