Category: Retirement Plan Alternative

Dalbar 2016 Report: Many Investors Haven’t Even Kept Up With Inflation

May 18th, 2016 by Pamela Yellen | 6 Comments

The latest report from DALBAR reveals the harsh reality about the actual returns stock market investors have been getting for the last 30 years.

Would it surprise you to know that many investors haven’t even been able to keep up with inflation for the last three decades?

Many investors haven’t, according to the 2016 Quantitative Analysis of Investor Behavior.

Here are the facts about actual long-term investor returns

The average investor in asset allocation mutual funds (which spread your money among a variety of classes) earned only 1.65% per year over the last three decades!

These investors didn’t even come close to beating inflation, which averaged 2.6% per year.

The average investor in equity mutual funds averaged only 3.66% per year – beating inflation by only 1% per year. (Was that worth the roller-coaster ride and sleepless nights?) [Read more…] “Dalbar 2016 Report: Many Investors Haven’t Even Kept Up With Inflation”

Do You Have As Much Saved for Retirement As the Average Person?

March 30th, 2016 by Pamela Yellen | 3 Comments

How do you think you compare to other people when it comes to how much you’ve saved for retirement?

The results of a new survey from the Employee Benefit Research Institute (EBRI) reveal some surprising insights into America’s preparedness for retirement.

Read on for the highlights of the 2016 Retirement Confidence Survey and a 6-Step Action Blueprint to make sure your money lasts as long as you do…

The survey revealed that 54% of all workers report less than $25,000 in household savings and investments, excluding the value of their primary home.

That includes 26% who say they have less than $1,000 in savings.

10% have between $25,000-$49,999 saved, 10% have between $50,000 and $99,999 saved, and 12% have between $100,000-$249,999.

And how many have saved $250,000 or more? Just 14%.

Are people close to retirement any better prepared?

The Ticking Tax Time-Bomb of Conventional Retirement Plans

March 3rd, 2016 by Pamela Yellen | Leave a Comment

One of the biggest selling points of 401(k) and IRA retirement plans is that the money you put into them isn’t taxed right away. Bring out the bubbly to celebrate, right?!

Not so fast.

First of all, some people – hopefully not you! – mistakenly believe money placed into these retirement plans is “tax free.” It isn’t. It is “tax deferred,” meaning that you will pay tax on that money when you withdraw from your retirement plan down the line.

Deferred taxes might sound good, but deferring your taxes is like putting off a visit to the dentist. The problem compounds and will only get worse.

Deferring taxes creates a dangerous potential tax time bomb because you don’t have the answers to two critical questions…

First, what will the tax rates be when you retire? And what will they be 20 or 30 years later?

Is Your Money Frozen in Your Retirement Plan?

February 25th, 2016 by Pamela Yellen | Leave a Comment

One of my biggest beefs with government-controlled retirement plans, such as 401(k)s, IRAs, 403(b)s and Roth Plans, is the total lack of liquidity. The money you’ve socked away in your conventional retirement plan is about as solidly frozen as the iceberg that sank the Titanic! And because of this, if your financial ship hits rough waters, you might end up sinking as well.

Here’s the critical question: How quickly and easily can you get your hands on all the money in your retirement account if you need it before age 59½?

We all know life happens. Cars break down. Roofs need replacing. A tough medical diagnosis can create mountains of unexpected bills to pay.

Every year many participants in employer-sponsored government-controlled retirement plans make early withdrawals for a number of reasons. And every year, the IRS collects penalties related to those early withdrawals.

In fact, in the last year for which statistics are available, the Internal Revenue Service collected $5.7 billion dollars in penalties from Americans who took out $57 billion from their retirement funds before they were supposed to. [Read more…] “Is Your Money Frozen in Your Retirement Plan?”

Who’s Got Control of Your Retirement Plan?

February 18th, 2016 by Pamela Yellen | 3 Comments

Do you remember playing with that kid in the neighborhood who set up a game, and then changed the rules as the game went on to suit himself? Just like those games, you’ll never come out winning with your retirement plan if someone else sets – and constantly changes – the rules!

Here’s one of those inconvenient truths: When your retirement savings are in a government-controlled plan sponsored by your employer, your employer can change the rules at any time. And so can the government.

Despite the mass of paperwork your employer handed you when you first began your retirement plan, your employer’s retirement plan rules are not set in concrete. Employers can change their rules, even in midstream.

For example, not too long ago, IBM decided to change its retirement plan rules. Up until that time, IBM gave employees their 401(k) match with each pay check. But some smart bean counter pointed out that Big Blue could save a bundle if they waited to give the match until the very last day of the year instead of throughout the year.

So what’s the big deal?

What Infinite Banking and Nelson Nash Missed

February 17th, 2016 by Pamela Yellen | 3 Comments

Updated November, 2019

Pamela Yellen was introduced to Infinite Banking through Nelson Nash’s book, “Becoming Your Own Banker: Unlock the Infinite Banking Concept”

I am infinitely grateful to the late Nelson Nash for introducing me to the Infinite Banking Concept®. It’s a very powerful concept that brings to the table Nelson’s life-long study of the Austrian School of Economics.

In this article, I described what Nelson got right about this concept, and my own life-changing experience of how it lets you “Become Your Own Banker.”

However, here are several things in his ground-breaking book that I take issue with, and that have caused unnecessary confusion for readers

**1. His first book, Becoming Your Own Banker®, was copyrighted in 2000.**

What Nelson Nash and Infinite Banking Got Right

February 12th, 2016 by Pamela Yellen | 1 Comment

UPDATED November, 2019

My introduction to the late Nelson Nash and the Infinite Banking Concept® was a major turning point in my life.

Up until then, I was a business-building consultant to financial representatives. The financial representatives I coached were always bringing financial products and strategies to my attention, and over the last 25 years, I’ve investigated more than 450 of them.

Unfortunately, most turned out not to be worth the paper they were printed on.

Finally, one financial representative asked me if I had ever heard of Nelson Nash, and the book he wrote, Becoming Your Own Banker: The Infinite Banking Concept.

I had not, but it sounded very intriguing, so I called and talked to Nelson and ordered a copy of his book. [Read more…] “What Nelson Nash and Infinite Banking Got Right”

Who’s the Bozo Administering Your Retirement Plan?

February 10th, 2016 by Pamela Yellen | Leave a Comment

When you have a plumbing issue, you call in a qualified plumber, right? When you need a medical procedure, don’t you want a qualified doctor? When you go to get your car fixed, aren’t you going to hand it over to a qualified mechanic?

So why would you turn your retirement plan over to an unqualified administrator?

Wait! You didn’t know that you’ve placed your hard earned retirement money in the hands of someone who very likely doesn’t know what they’re doing? It’s one of the common retirement planning traps I’ve been covering in this blog.

According to SmartMoney magazine, 90% of the country’s 401(k) plans are watched over by people who “need no special qualifications and no investing expertise or experience.” [Read more…] “Who’s the Bozo Administering Your Retirement Plan?”

How Hidden Fees Are Sabotaging Your Retirement Plan

February 4th, 2016 by Pamela Yellen | Leave a Comment

In my first blog about costly retirement planning traps, I explained how conventional retirement plans put you in jeopardy of losing money you absolutely cannot afford to lose. Just because all the other lemmings choose to dive over the cliff, doesn’t mean you have to!

Now let’s look at the gremlins of conventional retirement plans that are decimating the nest egg you’re trying to build: FEES.

Do you even know how much you’re paying in fees each year for your retirement account? If you’re like most Americans, you don’t have a clue. The Employee Benefit Research Institute found that only half of 401(k) plan participants even noticed the fee information stuffed in the 14-page disclosure (that requires a magnifying glass to read and 3 years of law school to understand).

And almost no one makes any changes to their plan if they do read the fee disclosures.

Most folks just don’t think fees are all that important. Or, they think they’re unavoidable – sort of like death and taxes.

Wrong on both counts!

Retirement Planning that Helps You Sleep at Night

January 29th, 2016 by Pamela Yellen | Leave a Comment

Let me be blunt. If you’re like the vast majority of Americans, your retirement plan is about as good as the survival plan of that last lemming heading over the cliff!

For most of us, our “retirement planning” has been manipulated by our employers, Wall Street, and celebrity talking heads – all of whom have their own agendas that don’t seem to prioritize our financial security and well-being. And the vast majority of personal financial representatives have chosen to stick with conventional strategies without even questioning the less-than-stellar results they’ve given us over the years.

Risk, a four-letter word? When a “plan” proves that it isn’t getting the results it’s supposed to produce, doesn’t it make sense to come up with a different plan? (The answer is “Yes!”)

Over the next several blog posts, I’ll illustrate specifically how and why your conventional retirement plan is failing you and changes you can make that will let you build a retirement savings fund that is safe and secure – guaranteed.

Let’s start with the problems of conventional retirement plans. I know of at least six major pitfalls and traps and I’ll cover each one in detail. The first painful trap is RISK. [Read more…] “Retirement Planning that Helps You Sleep at Night”