I am an endurance runner. More serious than some and not nearly as serious as others. I run for many reasons. It helps me stay as fit as I can while I grow older, it’s great therapy (running shoes, shorts and a t-shirt are still much cheaper than the therapists couch) and most of the good ideas I have ever had have come to me when I am running. My favorite time of the day to run is early in the morning. It’s quiet, there aren’t that many other people out yet and it’s also a time that I can reflect.
It was about four years ago that I came up with an idea to write a financial book. Titles are usually tough to come up with, but Wealth Without Wall Street came easily. I think it also came in an early morning moment.
In early 2007, when I had the original idea to write the book, we had just finally recovered from a dramatic downturn in the stock market that took place from 2000 to 2002. By the third quarter of 2007, we had finally erased all of the losses incurred and the stock market reached the same level as when it peaked in 2000.
That downturn got me to thinking about all of the people who were planning to retire during that period. That everything changed for them. If they entered 2000 with a market-related portfolio with a $1mm value, by the end of 2002 that value could have decreased by 40%-80%. Assuming that they didn’t sell, by 2007, they might have gotten back to break even.
As Yogi Bera once said, “it’s déjà vu all over again” and in late 2007 the market meltdown repeated itself. This time it wasn’t just the stock market that took a beating, real estate went right along with it.
The financial lives of so many people changed during that period. Some may never recover. Today the real estate market hasn’t seen any significant recovery and the stock market is still 14% lower than it was in late 2007 which was where it was at its peak in the year 2000. So fundamentally we have gone an entire decade without any real gains in the market as measured by the S&P 500. If you want to take into account the impact of inflation, you could make the case that anyone who stayed the course is underwater by as much as 20%-25%.
I have been in the financial world for over twenty three years in one capacity or another. I have worked as a traditional stock broker, I have sold annuities and life insurance, I have owned both residential and commercial mortgage companies. My background offers me a unique perspective when it comes to personal finances.
My purpose for writing the book is to make people aware that there is a whole world of financial opportunities out there that take many different forms. My book is meant to take a broader perspective than just where to put your investment dollars. I hope to educate you on how to manage your debt, how to create perpetual streams of income that you cannot outlive and other revelations that will put you in control of your financial future.
While the ideas expressed here can be applicable for individuals of any age, I really wrote this book for baby boomers. At 58, I am smack dab in the middle of the baby boom generation. Most of the people that I have worked with in my financial career are baby boomers. No matter if I was taking a loan application, working on a financial strategy, I have had the opportunity to look at the personal finances of hundreds and hundreds of people. I can tell you that, with a rare exception, most people of my generation are in terrible financial shape and totally unprepared to retire or quit working.
Now that the first of the Baby Boom Generation is turning sixty and beginning to collect Social Security, we are being inundated with TV commercials and newspaper advertising from such financial firms as Fidelity, Schwab, Merrill Lynch, Vanguard Funds and a whole host of others. These companies fall under the category of what I’ll call the Wall Street mentality. They are all hoping to capitalize on the 70 plus million of us (that includes me by the way) who are either at or within a few years of retirement age.
If you were born between the years of 1946 and 1964, you are a baby boomer. For most of us it’s time to wake up and smell the coffee. Retirement in right around the corner and unless you’ve got well into seven figures put away, you are going to be facing some very harsh financial realities. That being said, it’s not too late.
What I hope to accomplish is to share with you perhaps a different mindset when it comes to income in retirement, however you might define it. So stay tuned for upcoming ideas that will provide you with real meat and potatoes ideas and options.
You can reach me at any time, my email address is email@example.com and my office number is 303.800.0543.