Stock Market

[Johnny]

I noticed the markets are rockin' today. It's nice to see the retirement account go north instead of sideways.

[BaldRob]

Always a good thing!

[PigPen]

Yes, that would be a positive move. I concur

[Robmeister]

The question is, if the market tanks...or I should say, WHEN the market tanks will you still go sideways or will you lose money?

There are newer vehicles available where you can participate in market gains...and LOCK IN THAT GAIN when the market tops out.  On the downward side...you just move sideways.  No mutual fund, diversified market mix, asset allocation or variable product does that.

Kinda the best of both worlds.  You don't have to settle for the lower yield bond funds or CD's if you want safety of principle.  You can preserve your principle at all points, participate in market gains and be protected from market losses.

That's my business--I'm a safe money retirement specialist.  You'd never know by looking at my picture 

[PigPen]

Honestly, I don't have a clue. I know how much the company and myself have put there, but that is about all I can tell you.

[Tyler]

The question is, if the market tanks...or I should say, WHEN the market tanks will you still go sideways or will you lose money?

There are newer vehicles available where you can participate in market gains...and LOCK IN THAT GAIN when the market tops out.  On the downward side...you just move sideways.  No mutual fund, diversified market mix, asset allocation or variable product does that.

Kinda the best of both worlds.  You don't have to settle for the lower yield bond funds or CD's if you want safety of principle.  You can preserve your principle at all points, participate in market gains and be protected from market losses.

That's my business--I'm a safe money retirement specialist.  You'd never know by looking at my picture 

Rob, are you referring to VULs?

[Robmeister]

Rob, are you referring to VULs?

Yes, that is one variable product where you put your principle at risk for the hope of more aggressive returns.  You will lose money in market downturns with VULs.  Not good for folks close to or in retirement.

VULs & VAs are ok if you know that they are a more aggressive product and you've got a good time horizon...but it still stings when you lose money in those downturns, man.  Plus there are too many fees in them.   I don't deal with VUL's, VA's or mutual funds...except to get folks OUT of them.

There are enough conservative-minded folks who were talked into those things not knowing what they are that I can make a living getting people out of them, making their money safe and giving them peace of mind.

[Johnny]

I can see how that would be useful for people at or nearing retirement, but at my age that vehicle is too expensive.

[Tyler]

Rob, are you referring to VULs?

Yes, that is one variable product where you put your principle at risk for the hope of more aggressive returns.  You will lose money in market downturns with VULs.  Not good for folks close to or in retirement.

Interesting.  The VULs that a couple people have tried to sell me have a guaranteed return of 2% if the market return is less than 2% and a cap on return at 11% should the market return more than that rate of return, though the principal was always secure.  Or am I mixing this up with another product?

[Robmeister]

I can see how that would be useful for people at or nearing retirement, but at my age that vehicle is too expensive.

Actually, the safer EIA's and EIUL's I'm speaking of for folks at or near retirement are far LESS expensive.  Chances are that your money is in a more aggressive vehicle (because of your age) that is MORE expensive.

And Tyler, it's hard to say by the info you gave...but VUL's (Variable Universal Life) is basically a mutual fund inside a life insurance contract.  And mutual funds are "in" the market = market risk.  Granted, there are a PLETHORA of mixtures (conservative ---> agressive) that can mitigate that risk to variousl degrees.  But you can still lose principle.

[Robmeister]

By the way, this is my role model/mentor.  Yep, he's a chromer makin' about $1.5 million a year helping folks make their money safe.

[Johnny]

They guys I use are Two Rivers Capital Management. They have returns that far outpace the S&P 500, and they do it with less of a standard deviation than the S&P 500. www.2riverscapital.com

[Robmeister]

They guys I use are Two Rivers Capital Management. They have returns that far outpace the S&P 500, and they do it with less of a standard deviation than the S&P 500. www.2riverscapital.com

Just noticed yer a sly finance guy too....right on...brethren in the moolah field!!

Sounds like a cool fund....Yeah, there are so many cool ways to strategically utilize, like, put and call options to mitigate volitility and protect the downside.  We have a great one managed by Genworth Financial that sounds like the one you described.  It has averaged a maximum loss of 10% no matter what the market has done over the last 10 years.  My only beef with those is #1) FEES  #2) even at a max loss of 10%...10% of $800K is $80K....OUCH!

[Johnny]

We may have to swap some more stories.