This past Saturday I went to the Austin Texas Food Bank to volunteer to help out with sorting food items.
I live outside San Antonio and we also have a food bank yet a car club I belong to out of Austin decided we could help out so 16 of us volunteered. Afterwards, we went to a local restaurant for some Texas BBQ.
While sitting at a table for lunch I got into a conversation with a fellow about retirement and savings. In the course of the conversation, he indicated that his savings were not in the best of shape and that his retirement was provided by his employer. I asked him was the retirement program FULLY funded? He said he had no idea if it was.
Well let me ask you is your retirement program fully funded?
Don’t be afraid to ask your employer to what extent your plan is funded. Many municipal, city, state and county retirement plans are way underfunded. You may have to go to HR or the plan administrator. Don’t be surprised if they stall and do not give you a straight answer. Many companies try to hide the fact that their pension plans are underfunded. Phil’s Pension Lost $150 Million.
While we are on the subject of pension plans. If you do not have a company pension plan do you have a plan like a Roth IRA that you contribute to? There is an excellent book I would recommend you read on IRA’s that have just come out. The second edition on Amazon IRA.
If you are wise you will be preparing for a downturn in the economy. Many people are oblivious to what is on its way. We as a country have been spending beyond our means and the government has been printing money (quantitative easing) which is stoking inflation.
This past week Facebook plunged as low as 25%. To be clear, that is the largest single-day loss of value ever seen in the history of the world. Mark Zuckerberg,s net worth fell by $17 billion. You are going to see many corrections occur. You cannot have companies like Netflix continuing to run a deficit and to continue to borrow just to pay the interest on their debt. Netflix’s stock recently tank and billions of shareholder wealth vanished in an instant.
The FAANG companies have been propping up the stock market yet that will come to an end (FANND= FB, Amazon, Apple, Netflix, and Google.)
There are two kinds of debt. Good debt that is used to grow your business and bad debt that is spent on things that do not generate profit. GE is in a pickle now because of bad debt.
Look at the good debt that can generate positive cash flow no matter if it is in an IRA or not. Use Debt to Increase Your Net Worth.
