Can You Afford Losses In Your Retirement?
When you’re drawing income or nearing retirement, recovering from losses can take years you may not have.
“Rule #1: Never lose money.
Rule #2: Never forget rule #1.” — Warren Buffett
- A 25% loss requires nearly a 34% gain just to break even.
- A 50% loss means you must achieve a 100% return to get back to where you started.
- We focus on preserving principal while aiming for reasonable growth.
Here’s Why Protecting Your Retirement Matters
Did you know that a 25% loss requires a positive return of nearly 34% just to get back to even? A 50% loss means you must double your money (a 100% return) just to recover.
Think about it: if you have $100,000 and lose 50%, you’re left with $50,000. Now, you face the daunting challenge of climbing back to $100,000—a full 100% return—before you’re “whole” again. How long will that take? Two years? Five years? Ten years or more?
And what if you experience additional losses along the way—or worse, you’re drawing income from that same account? The impact can be devastating.
At this stage of life, the best way to make a dollar is to keep it. Retirement is critical, and most people simply don’t have the luxury of time to recover from portfolio losses. That’s why we help our clients achieve reasonable rates of return—often averaging 4% to 6%—without ever subjecting their retirement savings to market loss. Guaranteed.
Facts rather than opinions. Logic rather than emotions. Math rather than missing information.
Learn more in Stephen’s book, Safe Money. Request your complimentary copy below.