Why do all financial advisors tell the same risk story?
Question:
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Well which is it? We have lost $1.2 million over 8 years following this rolling period story. If we follow this story over the next 15 or 20 years with an income draw of 3% or 4% how much will we lose? How about when we will go broke? No way! We want guarantees that we will not go broke? We want guarantees that we will live very well in retirement.This is why annuities work for us and why we will do only a small percentage in index stocks.
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These annuities have no chages or fees I get all that I listed. in other question.
Answer:
This is the story the buy and hold managers have been telling for years and it is drilled into every Financial Advisor Training program out there..
Rolling 10 Year periods was the biggest training concept for many years.
Since it will not work for 10 year periods starting in late 1998, 1999 & 2000, they adjusted the training to use 15 year periods.
Interesting tidbit, the more conservative who don't want egg on their face again are saying to use 20 year rolling periods. The market can not possibly show a loss over a 20 year period. Can it??
Well " Past performance is not a guarantee of future results"
The universal statement that gets all Financial Advisors off the hook.
I agree Annuities Solve More Financial Needs for more age groups than any other Solution!
Annuities are The Best SAFE MONEY products! The three best are the following:
1. Immediate Annuities - For Guaranteed Monthly Income for Life, Joint Life or for a Period of Time: Go here to learn more - http://www.jdsannuities.com/immediate_an...
2. Fixed Index Annuities ------Where your account value does NOT Decline in Value. -----Where the Credited Interest to your account does NOT Decline in Value. -------Where the interest you earn each year is based ONLY on the Upside of a Stock Index (You would accept a Cap on the Upside of say 8% in exchange for not having your account decline in value, wouldn't you?? I know I would!!) The Cap varies by company & annuity and is usually guaranteed for 1 year. Other crediting methods are also available. To Learn more Visit: http://www.jdsannuities.com/index_annuit...
By the way, the way the insurance company is able to vary the interest you earn which is based on a stock index is by the use of a derivative for the interest part only.
Fixed Deferred Annuities - Where you have a wide selections of multi-year guaranteed rates or for 1 year, 3 years or 5 years. most are 5 to 10 year products. To Learn more and see most of the rates for yourself visit: http://www.jdsannuities.com/annuity_rate...
To view the overall website for Annuities visit: http://www.jdsannuities.com
the "risk story" is from the same manual drafted by regulations organizations - SEC, CFTC, etc. these orgs make sure investment professionals such as financial advisors, brokers and traders tell the same "risk story" to investors as means of protection. plus the story is true anyway.
CD, CD, CD, CD FDIC, Your money is insured with FDIC. Do not even think about something else. Cd's will yield at least 5%. That return sounds a lot better than a negative return. Or you can speculate on the Lumber Futures Derivatives and "Hit A Home run"!
If you have confidence that you can handle your own finances better than those in the business of being financial advisors, then the answer is to continue guiding your own ship. It's working for you and you've decided that paid advice is not a benefit to you.
This is a very simple question with a very simple answer: the more risk you are willing to take, the greater LONG-TERM return you are likely to earn.
There is no free lunch in investing. If you seek big returns, you must accept higher risk.
You want the truth? The simple real reason for what they do?
Most brokers and financial advisors are not in the business to make you money. They are in the business to not lose you a whole lot of money. It is by maintaining large portfolios that they are able to charge (management) fees off of which they make their money.
In reading your posts, all I can say is sorry. If you want to talk some time, I'll be glad to help you out.
But once you get some (decent) education on investing, there really will be no reason to ever lose money in a year again. EVER.
There are strategies out there where you have zero risk on your monies. (how can that be?) Well, the difference is knowing what you didn't know before. Most people don't know what they don't know. It's true, there are strategies for about anything you want to do (from 0 risk to lots of risk).
I'm still so sorry about what your financial advisor did to you. Hope you have enough left to make things work.
Let me know if you have any questions. I'll be glad to help.
Good luck!
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