In this episode, Brian Skrobonja goes over the three main retirement mindsets that could negatively impact your retirement plans.
He sheds light on what most retirees get wrong about retirement planning, why being confident doesn’t eliminate investment risks, and what to consider when hiring a financial planner.
- Brian goes over three retirement mindsets that have the potential to derail even the best-laid retirement plans.
- He starts by explaining that there is more to the conversation around retirement than just having a permanent vacation.
- Retirement is not a destination; it’s a transition into a new stage of life.
- The different mindsets you need when saving money and growing a nest egg versus spending and withdrawing money from your retirement accounts.
- Mindset #1 – The Idea That Annuities Are Bad.
- For Brian, retirement is about having a steady stream of income you can rely on no matter what Wall Street throws your way.
- Brian reveals that most retirees want consistency and predictability in retirement–they want to know exactly how much money they have coming in each month.
- Annuities are designed specifically to deliver this predictability and remove guesswork out of producing income for retirement.
- Remember, stock market risks are real and they don’t disappear just because an investor is optimistic about what could potentially happen.
- Mindset #2 – The idea of the status quo of the stock market in retirement.
- Some people believe that a well-diversified portfolio will predictably turn out enough profit to sustain them throughout retirement.
- According to Brian, what is missing from this ideology is that the market doesn’t go up in a straight line. If you experience a 50% loss, 50% in earnings will not get you back to even; you need 100%. And if you’re making withdrawals, that only compounds the problem.
- Brian reveals why the stock market is a great tool for wealth creation–but only if you allow the money to grow and aren’t making withdrawals for income purposes.
- Mindset #3 – Fee anchoring.
- What is a fee anchor? It’s the amount someone has in their mind for what they should pay for financial related advice.
- When considering a fee for an advisor, it’s important to understand that it’s less about the fee and more about what you’re getting in return.
- A fee is only an issue when there is a vacuum of value.
- For Brian, if you try to get an advisor to cut their fees, the more experienced and valued advisors will not take you as a client.
- Brian explains why finding the right advisor can be invaluable, especially when it comes to navigating complex financial products like annuities, private markets, or selling a business.
- Fees are important and you should understand them, but Brian encourages people to not use them as the primary consideration for making a decision.
Mentioned in this episode:
Common Sense Financial Podcast on YouTube
Common Sense Financial Podcast on Spotify
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