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Five of the Big Retirement Myths - Debunked


To paraphrase Warren Buffet:

“The purpose of a stock prognosticator is to make fortune tellers look good.” 

If the new volatility in the markets makes you uneasy, call or email anytime, we are always here to lend perspective.

In point of fact, in some way, from a global perspective, 2017 may have been the best year in human history. According to Nicholas Kristof in the New York Times on January 6th:

Every day the number of people around the world living in extreme poverty ($2 a day), goes down by 217,000. Every day 325,000 more people gain access to electricity and another 300,000 gain access to clean water.

More than 100,000,000 children since 1990 have been saved by vaccinations, diarrhea treatment and other health measures.

It is possible that in 15 more years, extreme poverty and illiteracy will be mostly gone.

The plain fact about stock market corrections is that they are inevitably temporary. The good news is that huge monies have come OUT of the stock markets since 2009 as they have gone up tremendously. We at Karn Couzens will be worried when that trend reverses itself and everyone is optimistic. 

On a different subject, let’s review:

Five of the Big Retirement Myths

When it comes to retirement, there are plenty of misleading thoughts and opinions floating around out there. This month, we’d like to clear up some misconceptions that surround the retirement years. With that in mind, let’s jump in.

I’ll never see a penny of the money I put into Social Security. If only we had a nickel every time we’ve heard someone utter that phrase. Sadly, if a 40-something says she is confident she will receive monthly checks, she sets herself up for ridicule among her contemporaries.

Back to the matter at hand, Social Security is not on the verge of bankruptcy, and we fully believe even those who are many years from retirement will be collecting monthly benefits when it’s their turn. Let us explain.

According to the 2017 annual report from the Social Security and Medicare Board of Trustees, Social Security “has collected roughly $19.9 trillion and paid out $17.1 trillion,” in its storied 82-year history, “leaving asset reserves of more than $2.8 trillion at the end of 2016 in its two trust funds.”

As an ever-larger number of baby boomers continue to retire and collect benefits, the trustees expect the trust funds to be depleted by 2034.

Of course, these are simply projections and much will depend on economic growth, job creation, and wages. Yet, it’s a far cry from, “I won’t see a penny of Social Security.”

We expect that politicians will eventually settle on some type of compromise that will extend the life of the current system. In our opinion, when they have to, they will.

That said, we recognize that timing and strategies that can be implemented for Social Security may be complex. If you have questions, please call or shoot us an email. We would be happy to discuss your options with you.

The stock market is too risky. Made fearful by what they see as too much risk, millennials have shied away from stocks, according to a Bankrate survey. What seems like a complete disconnect:  Millennials seem to be far more interested in Bitcoin! The word speculative doesn’t even begin to describe Bitcoin.

There has always been a degree of risk in stocks, even with a diversified portfolio. Yet, a well-diversified portfolio is akin to a stake in the U.S. and global economy. Moreover, the U.S. and global economy has been expanding for many decades. It may not be larger next year, but history tells us it will be bigger in 10 or 20 years. We will continue to discuss at length and call anytime to review your own positioning.

Medicare will handle all my health care needs in retirement. If only Medicare did cover everything. But then, the cost to finance it would be much higher. 


Medicare also doesn’t cover the full cost of skilled nursing or rehabilitative care, according to AARP.

You may be paying out of pocket for personal care assistance, too. The same holds true for miscellaneous hospital costs, routine eye exams, hearing, foot and dental care.

Why save today when you can start tomorrow—there’s plenty of time. This section is designed for millennials and those who are just beginning their journey in the workforce. There’s no better day to begin saving than today!

For example:

Susan invests $5,000 annually between the age of 25 and 35 and earns 7% annually. She puts away a total of $50,000.

Bill invests $5,000 annually between the age of 35 and 65 and earns 7% annually. He saves a total of $150,000.

When Susan reaches 65, she will have amassed $602,070, while Bill will have $540,741.

Source: JP Morgan Asset Management

Lesson learned–the sooner you begin, the better off you will be as you approach retirement.

Retirement is easy. Many look forward to the day when they will no longer prepare for Monday mornings at the office. For those who face the work challenges that crop up daily, retirement may seem like a welcome oasis in the distance.


The most important thing you can do to make retirement enjoyable is to stay active and keep your mind and body sharp. While our clients say that “every day is Saturday”, we find that the happiest ones are those that had their “next career” activities lined up and ready to go before they fully retired. In fact, our retirement agendas list that as a discussion item, because we hope you will have many years ahead of you, and you need to find fulfilling things to do beforehand.

To conclude, we are always available to review your own situation and questions, reach out if you need either one of us or our team members. We’ll finish with a further quote from Warren Buffet, who called the corporate tax rate:

“A big deal…a huge, huge reduction,” summed it up this way in a CNBC interview in the middle of last month:

“You had this major change in the silent stockholder in American business, who has been content with 35%…and now instead of getting a 35% interest in the earnings (he noted foreign earnings from U.S. firms are more complicated) they get 21% and that makes the remaining stock more valuable.”

It’s a unique and colorful way to describe the new tax regime.

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