Nevada Retirement Planners

LONDON (Reuters) – The government’s investment arm is planning to vote against former Royal Bank of Scotland Chief Executive Fred Goodwin’s controversial pension plan at the bank’s annual meeting this week, various newspaper reports said on Sunday.

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Automatic enrollment is a key factor in establishing near universal workplace savings accounts, but then it gets complex.

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Every state, except a band stretching from the Dakotas to Texas, is shedding jobs at a rapid pace.

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The leap in wealth that Americans thought they were enjoying has turned out to be a mirage, according to new estimates by the Federal Reserve.

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Financial institutions probably need hundreds of billions of dollars in assistance, and Representative Gary L. Ackerman wants to harness pension funds to help them.

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Advice from retirement planning experts geared toward current retirees and investors of all ages.

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The old Plan B was a fantasy of dropping everything for a better life. Now it’s the backup plan for when the worst comes to pass.

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At least a half-dozen construction unions had entrusted pension funds and health care money to Bernard L. Madoff.

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Annuities are a basic staple of modern portfolios, the financial equivalent of a backstop to guarantee a minimum of income in retirement.

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As this piece elsewhere on FP.com indicates, after a brief uptick in February, Canadians' perception of the economy once again slipped into pervasive gloom. The Consumer Confidence Index slipped from 85.9 in February to 83.7 now, according to TNS Canadian Facts.

But is this any surprize, with stock markets retesting November's lows, with the Canadian winter dragging on, and with pink slips emanating from corporate employers in industries as varied as autos and media?  

Take another look at the Cycle of Market Emotions, which we illustrated in this blog entry at the end of February. It should be clear by looking at the chart that the emotions of the typical investor currently are somewhere between capitulation, despondency and depression. And when, as for a few days this week, markets rally, is it not true that a brief flicker of "hope" arises — even if the skeptics dismiss it as another bear market rally, sucker's rally or "dead cat bounce?"

True, things may be even worse than we think, and if it turns out that we are collectively located earlier in the curve at denial, fear, desperation or panic, then things are bleak indeed. In fact, I'd like to hear from readers of this blog as to what emotions they're feeling themselves right now: where on the curve would you put your own emotional response to this stock market action and financial crisis? Email me at jonchevreau@hotmail.com. [I'll be on March break later this month and more likely to respond to that email address.]. I'd also like to hear about your coping strategies.

If indeed most have reached maximum pessimism, that traditionally has been viewed as the point of maximum buying opportunity for stocks, a saying that the late Sir John Templeton popularized [pictured, right]. In February, Franklin Templeton Investments Corp. commissioned an Angus Reid online survey that found a surprising 33% of Canadian investors are feeling opportunistic and "willing to take on risk in their investment portfolios."  Mind you, 34% remain timid or suspicious while 32% aren't sure.

Don't lose twice

Franklin Templeton president and CEO Don Reed is convinced stocks will recover and the organization is trumpeting the "Don't lose twice" theme to financial advisors and their clients. That's a reference to selling in despondency right at the bottom of the cycle of market emotions, when in fact odds are it's actually a better time to be buying (if you have the cash). You "lost once" watching losses on paper but of course those loses only become "real" if you crystalize then and sell at the bottom. That's what they mean by "losing twice."

Of course, misplaced optimism can also be dangerous at this juncture. It's tempting to look at this chart, current low interest rates, good stock valuations and high dividend yields and conclude it's a good time to borrow to invest, or indulge in "leverage." Reed warns against this and says Sir John always told investors who asked this question not to do it with his company's mutual funds. While Reed says most gains happen at the beginning of an economic recovery, the organization nevertheless recommends averaging into the markets gradually, which means an approach of "dollar cost averaging" with money as you earn it.

To return to the topic of reverse indicators, that's a reference to the fact we in the media are often a barometer of the public mood, and some investment pros feel therefore that media gloom is a "reverse indicator" that things are actually starting to look up. The classic media reverse indicators are magazine cover stories: the Business Week "Death of Equities" being the classic example. The magazine became so convinced that stocks were dead it gave the theme front cover treatment, and stocks promptly when on a tear for the rest of the decade.

The Findex reverse indicator 

By the same token, CFP Fred Kirby — no stranger to this blog — is convinced that what he's dubbed the Findex – the Findependence Day "retirement" age that closes each blog post here — is a classic reverse indicator. Before the market crash, I usually closed with a –60–, which is my ideal of a sufficiently early retirement. When markets retested their lows in recent weeks, I moved this in a moment of despair to 70, then back to the normal retirement age of 65.

With the tentative rallies of this week, I declared in a recent Twitter post [my handle is JonChevreau] that "the black clouds are now just dark grey."  So — be warned! — I'm moving the Findex down to:

 —63–
 

Source The Wealthy Boomer : Retirement