Thursday, February 11, 2016

Time To See The Bigger Picture

It’s been a phenomenal run since 2009 if you’ve had money in your 401k or brokerage accounts tracking the overall stock market.  That is unless you’ve been sleeping for the past month while global stock markets have been falling fast to start the year.

Could you have prevented this market loss in your portfolio?  Chances are you could have if you did a couple of things.  For starters, I usually recommend turning off the news and skipping the newspaper, unless you’re just reading the local news or sports section.  Everything else is usually political or economic drivel slanted towards one viewpoint or the other and in this writer’s opinion should be considered only for entertainment value.  If you’re internet savvy, there are better “alternative” sources of information where you can get a more informed read on what’s going on in the world.

Beyond becoming better informed about the state of the economy than what the mainstream press and government statistics can tell you (next to nothing truth be told, unless you actually believe the unemployment rate is really 4.9% as reported, and the housing market will continue to rise indefinitely… it won’t).

Point #1: You can and probably should look beyond mainstream news outlets for what’s really going on the economy.  You know the saying: “insanity is doing the same and expecting different results”.  The media is there to pacify you and a strong federal government most likely isn’t interested in having a well-informed populace.  There would be too many questions to answer.  Think about it.  Sadly, you’re financial advisor likely watches the daily news and reads Kiplinger’s or Money Magazine for the next great investments so good luck getting a different opinion there.

Here’s another popular saying and one of my personal favorites because I come across it quite a bit: “Can’t see the forest for the trees”.  This applies to you if your portfolio is all stocks and bonds/mutual funds.  For example, your 401k or 403b.  It’s difficult to impossible to prevent market losses if your money is tied solely to the ups and downs of the market.  Even bond portfolios lose money!  

Point #2: The only way to avoid market losses is to be… wait for it… completely out of the market.
This means you need to own assets outside of the Wall Street paradigm.

That may seem like a difficult task because frankly there are limited options to invest beyond the conventional financial products and solutions usually touted as the best way to accumulate a nest egg by all the big talking heads and Wall Street financial firms.

Fortunately, however, alternative strategies do exist and they are becoming more popular than ever largely because they provide a few things the traditional Wall Street portfolio lack:  safety of principal and guaranteed lifetime income.  

For a truly diversified portfolio, I would encourage you to think about working with financial institutions that have a vested interest in your future.  Remember Wall Street is just one way to accumulate wealth.  It can be a very good to you when the market is rising.  After all, a rising tide lifts all boats.  

But I think it’s safe to say the tide is headed out and there’s no point in being the one who is caught swimming naked.  

If you haven’t sat down with an advisor who specializes in strategies that can protect your assets, it’s time to consider looking at life insurance related solutions. 

Anthony Robbins recently published Money: Master The Game and in his book he interviewed the world’s greatest investors.  It’s an incredibly powerful and insightful book.  I encourage everyone to pick up a copy to learn everything Mr. Robbins learned during his research but here are two of the ground breaking conclusions Mr. Robbins shared in his best-selling book that I’d like to share with you:

  1.  “Private Placement Life Insurance” is a must have for every portfolio.  For those unfamiliar with Private Placement Life Insurance, this strategy is more commonly called the Infinite Banking Concept ® or Bank On Yourself ®.  Speak to an advisor certified to offer these solutions. 
  2. To paraphrase one of the highly accomplished investors Mr. Robbins interviewed: “The only outcome that matters is INCOME”, and in this particular chapter Mr. Robbins writes about how to create your very own private pension by utilizing Indexed Annuities. 

There you have it from one of the most influential and highly networked individuals alive.  If you only have a Wall Street portfolio, you should speak to an advisor who can help you see the entire financial landscape, including life insurance related solutions, so you start protecting your assets from loss and taxes while also building a future guaranteed income stream you can’t outlive.

Anything less that and you know the saying: “Can’t see the forest for the trees!”

John Montoya co-authored The Secret To Lifestyle Financial Security in 2013 with best-selling author Pamela Yellen.  To contact John, please visit