What Grandma doesn't know could hurt her.

The other day, I had a phone conversation with my Grandma (a very sweet lady). In between the chit chat about her travels and her favorite cat (his name is Bruno, and he is treacherous to everyone but her), she told me that her retirement fund was constantly loosing money. She is invested in a wide variety of mutual funds, and they are bleeding her fund dry. At the age of 68, do you think she can afford to have her largest means of support continue to loose money?!!

I don’t think so.

The sad fact of the matter is that she is not alone. Many Americans have experienced the same trend over the last couple of years. With the volatility of the stock market, most people don’t have the financial intelligence to gauge which stock to buy, and when. That’s why they put their money into low yielding CD’s or Mutual Funds.

Just like that popular infomercial, people are hoping that they can just “Set it, and forget it!” and come back to a well prepared retirement. This type of thinking usually gets people in trouble.

Mutual Funds are invested in with little or no information, with managers who tack on the fees and commissions (and some are of the notion that a monkey could pick stocks to invest in and have a portfolio garnering equal or better returns). CD’s just barely staying ahead of inflation, and IRA returns are marginal at best. So what’s the forecast? If people don’t radically change their outlook, and learn more about investing…it looks like the perfect storm for poverty in retirement. Maybe that’s a little to extreme, but in the least, at the age of retirement, you will live in a condo in Florence, AZ instead of villa in Florence, Italy.

So it’s time to get more serious about your finances. Over the next few weeks, the Wealth Creation Alliance will do a series on investing your retirement plan for better returns.

What are the option plans?

What is favorable for taxes?

How much can you invest in any particular plan?

We’ll go over these topics, and provide you with the most up to date information that will help you make the calls to retire better…faster. In addition, you will be able to control your accounts, ensuring you are the one making the important decisions on your financial future.

With a little more diligence and investment savvy, my Grandma should be able to make more informed decisions on how to invest her retirement savings properly. Stay tuned for the progress!