Many of my clients and event attendees ask what they should do for retirement, especially since most have lost trust in retirement plans. Unfortunately, due to lack of knowing what to do, they keep funding these plans hoping that something is better than nothing.
This is a plan doomed for failure!
Let me begin by addressing where retirement plans fail.
You may have read my previous blog about presumed returns that aren't reality. I would still keep in mind when considering this.
I believe, and have personally experienced, that financial freedom is most possible when you focus on increasing your cash flow TODAY rather than saving and accumulating for a day you may never see.
In fact, even if you see that day, you will have more freedom focusing on cash flow now, and saving it in your mattress, than you would saving whatever scraps you have left over in retirement plans.
Because financial advisors are teaching you to spend less, be cheap, sacrifice, suffer, and save every penny possible to some theoretical date, but does nothing to help you NOW!
What I promote is helping you find ways to get rid of inefficient costs, such as taxes, certain loans, spending without vision, purpose, or accountability, insurance costs, while focusing to increase your income NOW!
How do we even know that we'll be alive to enjoy our retirement at some indetermined age. They might say that automatic age of 65 (why 65?), but what if you have to be in for the long haul LONGER because the market didn't cooperate that year or you didn't quite save enough because you thought it was more important to invest in your children's education, religious growth, etc?
One flaw with the retirement concept is that it violates principles.
To work hard so we don't have to do anything is expecting something for nothing. You might say that you deserve it (because that's what financial companies want you to believe so they can create cash flow with your money while you sit on it), but that is only a lie! Many belief systems teach that you reap what you sow, or you are to work by the sweat of your brow all the days of your life, whether that sweat is physical, mental, or spiritual in nature.
This doesn't mean that you have to slave away for the rest of your life. What this does mean is we are meant to serve others the rest of our lives. The amount of service we render for others can come back in many forms of compensation.
In other words, I see it like this...
As stewards, we are here to increase our gifts, talents, relationships, personal growth, time, AND temporary material possessions. We have a sacred obligation to do the best we can with what we have while we're alive. We are to "become" wealthy in all things, only one of which is money.
Our money is meant to grow and expand!
For example, I grow my business not only to create cash flow now, but to create something that enhances others' lives too. As it grows, it's financial value grows in others' eyes. Rather than just hoarding my money (another violation of principle), I want to increase it by doing bigger and better things that creates even more value for more people.
As I grow, I create more jobs for others. We help each other increase each of our stewardship. I could build my business to a point where I can sell it off and just live off of the money by putting it in trusts, real estate, etc. But what's the fun in that? Why stop there when I can bless more people's lives by playing bigger, create more jobs, and enrich everyone's lives?
THAT is what I mean by increasing our stewardship! The whole idea of tossing money into a retirement plan where we have no control over the returns, little access to it (without getting our hands slapped), and lackluster returns compared to what we can do by investing in places where we have control, knowledge, and passion, seems meaningless to me.
So what's the action plan?
Focus on freeing up cash and increasing your income now, when you know you're alive and can enjoy the money! Invest that money in places where you know you can create better returns than just throwing money at some small-visioned financial advisor telling you that you can retire living off your hoarded interest.
Do what you love, and retire from the things you hate! You'll be much happier than someone living off of their "fixed income" in retirement waiting for death.
This is just my opinion though. What's yours?