Pensions and Bonds Markets
The danger of pensions and bond markets becomes unthinkable! As the new norm and effects of economic and social injustice in the world continues to deteriorate, good becomes bad, and bad becomes good.
I can’t end without sharing the injustice taking place with unfunded obligations like pensions and healthcare benefits. It’s terrifying how many retirees will be affected when they go to take out their pension benefits and find they’ve been cut by 30%, 50% or are even gone (100%!) because the government or corporation entity holding those funds spent the money – with hopes of future investments paying off. Whether good or bad intentions, big business or big government basically gambled away the people’s money.
When it comes to retirement, I have found that in most cases you can do better, have more control and greater options with your money when you take out a lump sum payout. You have the option to take the money you worked so hard for and have it privately managed outside of their control. There are companies that will safely manage your money outside of the pension safety net, which is now broken. Just look at what happened a few years back with United Airlines workers, and it’s even worse today. Someone else spent their money, just like with Social Security and Medicare.
Remember it’s your money, but not until it’s in your control and it’s safe. Otherwise, it’s only numbers on paper. I’d rather have money in-hand, than a promise.
Pay attention to what’s happening with the government bond market. Our Federal Government is broke, in debt, and can’t even bail itself out, let alone another entity. If it were any other organization, they would be bankrupt or out of business. Watch closely what’s going on in Puerto Rico. Soon you may see our local cities and states defaulting, asking for the same bailout treatment as Puerto Rico received. In any situation, it’s not good when a government entity can default on their promise. What was once known as a safe investment for retirement portfolios may soon become undesirable. unthinkable
This message was adapted from the World Economic Report.
You are invited to contact “The Money Doctor,” Mr. William F. Richardson, author, speaker, financial strategist, and retirement specialist for Citizens Financial Security and its affiliates. He is also the founder and director of The California Educational Institute of Wealth Enhancement. To learn more, please email William (at) MoneyDoctorAdvisor.com. This report is for educational informational purposes only. It is not designed or intended to offer tax, legal, investment advice, or an offer to sell. When making financial decisions, always seek the advice of a qualified professional. © 2006-2016 The Money Doctor. All rights reserved.