scared of stock market, should I stick with the advise of financial adviser?
September 15, 2015 at 12:32 am #144626
I retired just short of a year ago and started Social Security at age 66 a couple months later. I live comfortably on my pension and Social Security and have no debt. After completing Dave Ramsey’s Financial Peace University and using his local ELP, my financial adviser split my retirement money and an inheritance amount (total approx. $100,000) three ways with fees of 3.5% to 5%. I am terrified of losing what I do have. My health is not good and the odds are against me. Should my stocks stay where they are? (I lost $4,000 over the last quarter.) Is there a safe and wise alternative to the stock market? How crazy or stupid would I be to withdraw all my funds and stash it in a safe deposit box? I am serious and stressing out.September 15, 2015 at 1:18 pm #144643Stacy JohnsonModerator
The fees you’re being charged seem excessive. In addition, you seem to be risk adverse to the extent that I wonder if you should be in stocks at all.
The safe alternative to the stock market is the bank, although that isn’t particularly wise, at least for all your savings, since over time you’ll lose to inflation. Still, if you can’t tolerate risk, don’t take any. Eliminate the fees and the worry by investing in insured savings at the bank.
Literally putting all your money in a safe deposit box, however, would be crazy. Bank deposits are insured. That’s safe enough.September 15, 2015 at 8:32 pm #144711
Thank you for taking the time to personally respond to my question, Mr. Johnson. I have an appointment on Thursday with the bank. The sooner this is resolved, the easier I will rest.September 16, 2015 at 8:11 am #144781Stacy JohnsonModerator
You’re most welcome!September 24, 2015 at 10:15 am #145650
Hi, Mr. Johnson. I’ve been meeting with a financial advisor at the local bank that I have been doing business with for perhaps thirty years. Discussing annuities. However, it dawned on me last night (almost wrote you in the middle of the night) that you encouraged investing in INSURED SAVINGS at the bank. Whoa! I am now concerned I may be jumping off the deep end again too quickly. That financial advisor is working on paperwork, but I have not signed anything yet. Yesterday, a different financial advisor (that I met in April through my CPA) contacted me about my stock market money. It sounded like he freaked because I was willing to get annuities that paid ‘so little’ (five year liquid fixed annuity ROP at 2.05% for about half the money in my bank money market account and a seven year liquid fixed annuity ROP at 2.55% for the money in the stock market.) He is confident he can get more money through one of his annuities and argues that the bank’s financial advisor won’t be around in a year. He also argues that if in an emergency I have to take out my money from the liquid ROP I would have charges to pay. My bank advisor specifically said and wrote down “no charges for ROP.” Please help me again. I now am concerned you were suggesting some kind of insured savings at the bank INSTEAD of annuities. I do not have any idea what insured savings at the bank are available. I have no Roth IRAs. My money market pays .10%. Can you clarify the direction you meant by ‘insured savings’ at the bank. Also, I am thinking (but not sure) the annuities are insured only through the insurance company. Bank insures through FDIC. (By the way is the money insured by FDIC up to $100,000 per account or $150,000. My school-time memory was $150,000 but my kids say otherwise.) Thanks again for your past guidance. My biggest concern is the safety of what I have.September 24, 2015 at 5:41 pm #145700
I cannot delete my question, but tried. I have decided what I am going to do, and you do not need to respond.
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