Financial Market Misery:

The volatility in the financial markets this year is forcing a major change to the default dentist retirement plan.

Doctors and dentists are seeing wealth they’ve worked hard to save in their 401ks or other retirement plans literally being destroyed right in front of them.

We know that there are market and business cycles which usually occur every seven to eight years. This last time has been prolonged by a lot of manipulation from the government and the federal reserve, but we knew the day of reckoning would come. It's here, it's happening right now.

“My Financial Advisors told me: ‘This is the way it works’ ”

I feel bad for these doctors. One dentist I recently spoke with was in his lower sixties now. He was around his mid to late forties when the last great financial recession occurred. So I asked him, “Well, what happened back then?”

He says, “Well, I didn't have a lot of money saved at that point. I was still working in my practice. But I do remember when we went through the great financial recession, the same thing happened. What I had in the markets took a big hit. My financial advisor told me, this is the way it works, but you just stay in it for the long game”

Did the market come back? Yes, it did. We actually surpassed where it was back before the 2008 downturn, but it took 7-9 years to do that.

The problem is as you get further along in your career and begin to want to take your foot off the pedal, you cannot afford this kind of setback. A downturn will require you to keep working from age 62 to age 72 just to get back up to par.

For many of us, that's not in the cards.

This guy had been following me for years and just didn't do anything. He said, “Well, I just thought the markets would keep going up. It seemed like every time the markets would falter a little bit, the Fed would lower interest rates or they'd expand credit and everything would go back up again. My 401k was looking decent, good enough.”

He said he lost about 1.2 million dollars in just the last six months. My best guess is, we are not done with the bottom of this market.

Cash Flow is the Secret to Knowing “How Much is Enough?” 

Alternatives have always been the place where I've put my money. As long term investors, while we do see some changes in the valuations of some of the alternative investments like real estate, the cash flow is what stays constant.

It's all about the cash flow. It's not about accumulating a certain amount of net worth. It's what that net worth does – it’s putting it to work.

We've helped so many docs escape the chair with a lot less in net worth than their financial advisor told them they needed. Why? Because we actually help them generate the cash flow. That's what you want. 

You don't want a big nest egg that you have to deplete 4% per year and hope it lasts for 25 Years. We don't do it that way. We're in investments that produce the cash flow that gives us the lifestyle that we work so hard to have without depleting the principle.

Then you have all that much more to give to charity. To give to the next generations. To use however you see fit.

Now is the Time to Pivot – Do You Have a Plan? 

If you've been waiting and waiting on the sidelines, keeping your fingers crossed that we're going to get back to some kind of “normal” in this economy, you need to change direction.

If you don't have a plan, you need a plan. And you need a plan now. We can help you create that customized plan at Freedom Founders. We do it very, very well.