Young investors who've only known bull markets are taking dangerous risks chasing high returns. Retirees should prioritize sustainable income over raw portfolio growth, using guarantees to safely withdraw 6% instead of 4%. Women building wealth need a plan for debt payoff, cash flow, and credit building.
If you're younger than 40 or 41, you've never actually experienced a real financial crash, you know, which means you didn't, you didn't experience 2008, which was really the end of 2007 to the beginning of 2009. It was really like a year and a half. The joke at the time was your 401k, you know, turned into a 201k. And that was true. I mean, people lost half their wealth, at least on paper that year. And all the more recent crashes, you know, 2022 or the pandemic, like those were short lived and you know, those, those kind of happened and came back and people have just gotten conditioned that the market can do no wrong. We're in one of the longest secular bull markets we've seen in history. So who knows when that ends? Who knows if AI makes that continue forever? I have no idea. It's not my job to predict that. But if you're late for a meeting and you drive 95 down the highway, you'll get there on time, right? But you're taking a lot of risk. And that's what people are doing with the market right now is they're taking a lot of risk, they're driving 95, it might work out. But you know, if they, if they pass a cop or they get in an accident, all, everything, you know, falls apart, they miss the meeting or worse. So that's the problem with investing that way is you can, you can take a whole lot of risk. You can buy, you know, cheap stocks and quantum computing and AI and hope like heck, but the alternative is catastrophe. So yeah, I think a lot of people are doing that right now. And that's the wrong approach. The approach that I take by adding actuarial science and by adding guarantees into the plan. What people don't realize is, is the whole world, and for really good reasons, by the way, over the last few decades has been programmed around. How do we get to my number? So if that, like I said, if your number's a million bucks or your numbers 4 million bucks, whatever your number is in your mind to live the lifestyle that you want to live, we're all programmed and how do we invest to accumulate that number? But it's really why, why that number? Um, you can't spend the number, you can't spend your 401k, you spend the income that you draw out of it. So if there are ways to build your portfolio in a way where you can take a higher percentage out of your portfolio with the same confidence or better confidence, then you're better off. Or put differently, you know, 6% of 4 million is worth a lot more than 4% of 5 million, you know, in terms of the annual income that you're taking. So that's what we want to do is, is, you know, we're not. Don't reach for that extra 10 or 20 account balance. Reach for ways to give yourself permission to spend that money. So that in the 1 out of 4 chance that, you know, you retire into a down market, you're covered. But in the three out of four chance, the far more, the far greater likelihood that you retire into an okay market where you're still making money, this just, you know, caps off a good performance and, and makes everything even better.
What, what a good point about the highway example. I appreciate you putting that into just a simple analogy there as to what people are really doing with their money purely based out of fear and only focusing on one metric being the rate of return. And rate of return becomes less and less valuable as you get to retirement because it's, it's really not about that. It's a, it's what distribution rate are you getting on whatever you've, you've accumulated. I help moms women build wealthy kingdoms that will last forever to have authority over their finances, finances by helping them pay off debt, increase cash flow, lower your expenses, build your credit, all using your own income.
