Conservative Wealth Management LLC wants to be the solution to your retirement problem. Ben Stein and I have written a book on retirement investing (Yes, You Can Still Retire Comfortably). We take a special interest in needs of retirees and those saving for retirement.

Here from the book, is the...

Introduction

Money is an astonishingly powerful mind changer. Lots of it — or at least enough of it — makes you happy, while a shortage makes you miserable. There’s some magic to having enough that’s as basic as the need to take in water and oxygen. The “mojo” of having more than enough, of having an amount necessary to be comfortable, is intoxicating.

Just think about how you feel when you open a brokerage statement that says your investments have been doing well, and compare that with how you feel when it says they’ve been doing poorly. Imagine what it means to open an envelope and find a check instead of a bill.

Years ago, one of your authors, Ben Stein, got a call asking him to do a commercial for which he was to be paid what seemed like a lordly sum. He had lunch with a friend right after he took the call, and his friend asked if he’d had a face-lift. “No,” Ben replied, “I just got offered a lot of money to do something pleasant and easy.”

“Money,” she said sagely, “can make you look younger. Or,” she added ruefully (because she was short of money), “it can age you.”

We, your authors, are just ordinary people like you. We worry about money all the time, and whether we have enough of it. As we get older, we’re concerned about whether we’ve invested wisely. (We often haven’t, but we’re getting better with age ... we hope.) Most of all, we think about whether we’ll have enough to live comfortably when we’re too old and infirm — or just too worn-out—to work, and whether the people we love will have enough. We’ve seen magnificent examples of retirement preparedness — especially in our parents, all of whom died far too young — but we’ve also seen disasters among people we’re very close to.

This has prompted very serious study on our part to save ourselves and others. We want to begin our salvation at home, but we’d like to spare as many people as possible sleepless nights and torment. We love this country more than words can say, and we’re devoted to our fellow American citizens, as well as those of the UK, Canada, and all good countries. We want to offer some help based on our own terrible experiences and terrifying observations, as well as what we’ve seen that works. That help is within these pages. If you read and learn from it, your chances for a successful retirement will rise markedly.

As you make your way through this book, please bear in mind an admonition from a famous 12-step program: “No one among us has been able to maintain anywhere near perfect adherence to these principles.” Like the organizations that save lives from alcohol and drugs, this program is meant to be suggestive and to provoke thought. The closer you can come to doing the actions we suggest after thinking it over, the better off you’ll be.

We’ve seen the future, and it scares us; we’ve seen the past, in our parents’ prudent behavior, and it was inspiring. One of your authors (yep, Ben Stein again) especially saw spectacular results in his parents’ lives from the regular purchase of carefully selected variable annuities (VAs) in stocks. If we harp on regular purchases and on VAs, it’s because we’ve seen that they work miracles when carefully chosen and well understood. If you notice our emphasis on diversification, you can rest assured that we’ve also seen that practice achieve wonderful success. Above all, if we can teach you that a little self-discipline from a young age can transform your future by allowing the passage of time and compound interest to do the heavy lifting, we will have justified the few shekels you spent on this book.

Please take care not to torture yourself as you read if you’ve been way off course so far. Believe us, we’ve made every mistake possible. But each day starts a new wave of possibility, and we hope that you can ride that wave into a glorious, golden sunset. If you have any problems with the math and research here, e-mail Phil DeMuth. He did all the hard work for this volume (and if Phil finds that he has made any dumb mistakes, he’ll post corrections on our Website, www.stein-demuth.com). If you want someone to come over and babysit your German shorthaired pointer, e-mail Ben.

21 Basic Truths of Retirement Planning

1. There is no Lone Ranger coming to rescue the Baby Boomers and Gen Xers. There is not enough money anywhere to foot the bill: not in Social Security and Medicare, nor in our pension plans, nor our personal savings. The U.S. taxpayers in aggregate cannot tax themselves into solvency.

2. If you're old enough to have sex, you're old enough save for your retirement.

3. Saving early in life will let the power of compound interest do all the heavy lifting. Wait, and you will have to do it by brute force of self-denial. Wait still longer and it will not be possible to retire at all.

4. It is vastly more important that you hit upon a good investment plan and save regularly, than that you find the most perfect, brilliant investment plan and save desultorily.

5. People with savings will end up at a tremendous advantage over those without. This latter group will include many of your friends and neighbors.

6. To postpone planning your retirement is, in effect, to have already made the decision about where you are headed. Hint: it's not Millionaire Acres.

7. The X-factor of unknown future tax rates, as well as the tenuousness of Social Security and Medicare, makes it exceedingly difficult to plan accurately. Everything points to the need to err on the side of oversaving.

8. If you want a guarantee, buy a toaster.

9. You have to get off the high-consumption treadmill, maximize your human capital, and plan to work as late as possible (preferably into retirement, at least part-time).

10. You will be paying for the bulk of retirement yourself, out of your personal life savings.

11. Those who have saved will be made to pay for those who have not. Unfortunately, this means you have to save even more.

12. Hardest hit of all will be the upper middle class. They will likely see little from Social Security and Medicare, meanwhile the IRS will turn them upside down and shake them by the ankles to get the money to pay for everyone else. With vastly insufficient savings, their lifestyles are going to shrink like an Armani suit in the dryer.

13. If you are a high-income type, don't use a self-help book or a web site calculator to plan your retirement. Get the professional help that you need, preferably sooner than later.

14. You need to plan for your maximum life span, not your average life span. If you are 65, there is a 5 percent chance that you will live to 100, and a one percent chance that you will live to 105.

15. Investment returns going forward from current valuation levels may well be lower than they were during the boom times of the twentieth century. Just because you are a long-term investor does not mean that you will get historical rates of return.

16. The new retiree is of necessity a long-term investor. If he goes too conservative, he runs out of money later. That said, early retirement is by far the most dangerous time for your investments.

17. You won't be able to figure this out once-and-for-all. You have to monitor your progress and make mid-course corrections.

18. The advantage conferred by dollar cost averaging on the saving side is directly handed back by negative dollar cost averaging on the withdrawal side.

19. Long-term market timing can add value, both to your savings as well as to your withdrawals. Value the market before buying or selling. This is the cure for negative dollar cost averaging.

20. Do not put all your savings into one type of account: IRA, Keogh, taxable, etc. Who knows where the tax man's heaviest hand will fall in the future?

21. Nature's cruel joke on retirees: you'll probably have a lot of money very late in life, when you can't enjoy it, but you only get a pittance early in retirement, when you could really use it. Thus, the problem: how do we bring Oz back to Kansas?

Copyright © 2005 by Ben Stein and Phil DeMuth. Published by: New Beginnings Press, Carlsbad, California. All rights reserved.