Personal Finance Blog for Retirement and Investment Advice

Will the Government’s new plan to increase Americans’ retirement security work?

January 28th, 2010 by Pamela Yellen | 12 Comments

With much fanfare, the White House has announced the highlights of what they are recommending to help you save for a secure retirement. Will it help you… or hurt you?

Let’s take a look at the major provisions…

1. More Americans will be herded into a retirement plan system that most experts agree is broken

According to a newly released White House Fact Sheet, the administration wants to force many of the 78 million working Americans not currently covered by employer-based retirement plans into them. They will do this by requiring employers to enroll their employees in automatic direct-deposit IRAs, unless the employee opts out.

Experience shows most employees do not opt out. The result? Many more people will be relying on the same investment strategies that have lined the pockets of Wall Street and dashed the retirement hopes and dreams of millions of Americans.

On the other hand, those who use the Bank On Yourself method have been able to move closer to their financial goals and dreams each and every single year. To find out how you could turn your back on the stomach-churning ups and downs of stocks, real estate, and other investments, request a free, no-obligation Analysis today.

2. Proposed tax credits for retirement savings contributions mean you will be paying for other people’s investment mistakes!

Even millions of Americans who pay no taxes will receive these credits, under the administration’s proposal.

3. Employers will be expected to do what even the experts can’t

Employers who offer so-called “target-date” mutual funds will be expected to “evaluate their suitability for their workforce.”

These funds, which automatically shift assets over the individual’s lifetime to lower risk as the person approaches retirement age, failed miserably to accomplish that goal during the 2008 crash.

In addition, studies consistently show that 80% of all investment advisors and 80% of all mutual funds underperform the overall market¹. Yet employers with no training or experience will somehow be expected to determine which funds will do well.

4. The government wants to “promote” the availability of annuities and other forms of guaranteed lifetime income in 401(k) plans

Unfortunately, the growth and returns of some of these products may not even keep up with inflation.

5. Beleaguered small business owners will face new costs and administrative burdens

According to the National Small Business Association, 64 percent of small business owners surveyed said revenues declined in the past 12 months.

When small businesses are struggling to stay afloat, we oppose mandates such as this that stand to create a new administrative burden” – Molly Brogan, vice president of public affairs for the NSBA

6. The government controls your money in retirement plans, not you

The government determines when and how much you can take out of your retirement plan, and can change the rules any time they want.

Proposals to do just that have already been floated through Congress.

And if the government wants to force you to buy Treasury debt with part or all of their retirement plan money, because China and Brazil won’t take the risk any more, they can do it.

7. While expert after expert agree that the current systems of saving for retirement are broken, few offer any viable alternatives

Yet hundreds of thousands of people who use the Bank On Yourself method did not lose a penny during the market crash of 2008, or during the “lost decade” of the 2000’s.

Their plans have all continued growing – safely and predictably, and without the risk or volatility of stocks, real estate and other investments. Which may explain why my offer to pay $100,000 to the first person who uses a different strategy that can match or beat Bank On Yourself remains unclaimed.

Bank On Yourself isn’t a magic pill. It takes a little patience and discipline. But if you have those traits, it pays a lifetime of benefits.

To find out what your bottom-line numbers and results could be, and how much income you could count on at retirement, just request your free, no-obligation Analysis.

If you take the first step now, you could start taking back control of your money and your future financial security in as little as 60 days!

1. Hulbert Financial Digest, The Motley Fool

Lessons from a lost decade

January 15th, 2010 by Pamela Yellen | 3 Comments

I’ve lost a bet. I’ve lost my keys. But I’ve never lost a decade – until now.” – Sam Stovall, S&P’s chief strategist

The S&P 500 ended the past decade down almost 25 percent below where it was ten years earlier. And that doesn’t even factor in the 29% inflation we experienced during the decade.

since the end of 1999, the S&P 500 stock index has lost an average of 3.3% a year, on an inflation-adjusted basis, even after including dividends, according to the data compiled by Charles Jones, finance professor at North Carolina State University.¹

Hmmm… so what does that mean to the typical family in dollars and cents?

You may want to grab a bottle of Pepto-Bismol, because it isn’t very pretty…
Here’s what inflation and negative returns have done to a nest egg invested in an S&P 500 index fund (the way most Americans’ retirement savings are), over the past decade…

You now need a 39.9% increase just to get back to where you were ten years ago!

Given that the stock market has just experienced its fastest climb since 1933, how likely do you think it is that we’ll have another 39.9% rise this year? Especially given soaring government spending, stubbornly high unemployment, and looming tax hikes.
[Read more…] “Lessons from a lost decade”

Bank On Yourself: A financial plan you can count on

December 11th, 2009 by Pamela Yellen | 28 Comments

Oh what a roller-coaster year this has been! Our entire financial system and economy almost fell off a cliff.

And while there are some hopeful signs of new life in the economy, this year has also brought us:

Massive bailouts
A tripling of an already-bloated federal deficit
A falling dollar
Rising foreclosures (and likely to spike as billions of dollars in ARM’s are now coming up for adjustment)
Major banks and investment houses taking on three times (!) the risk they were before the collapse

So what do you think next year has in store for us?

No one really knows for sure. (Well, except maybe the folks at the Psychic Hotline.) So how do you prepare for a very uncertain future?

Here’s a quick quiz that may reveal an answer for you…

What’s the one financial asset that increased in value during the market crash of 2008? And in 1929? And in every period of economic boom and bust in between?

Answer: The product used for Bank On Yourself: Cash-value life insurance.

As I’ve mentioned, my husband Larry and I now have 18 Bank On Yourself policies. I’ve picked one of them to show you how a dividend-paying whole life policy like this can grow over time – even when the markets are plummeting. It’s a great example of how Bank On Yourself gives you the peace of mind that lets you sleep at night.

Here’s how much this plan has grown each year since the beginning of 2000, a period that includes not one, but TWO devastating market crashes. In four of these years, the S&P 500 was down for the year, as you can see in this side-by-side comparison:

If you had put $10,000 into an S&P 500 Index fund at the beginning of 2000, how much do you think it would be worth today?

Take a guess before you read on.

Bank On Yourself success story video

December 2nd, 2009 by Pamela Yellen | 9 Comments

In my best-selling book on Bank On Yourself, a number of folks shared the personal and intimate details of how they’ve been using Bank On Yourself to reach a variety of short-term and long-term personal and financial goals and dreams.

Perhaps one of the most inspiring stories was shared by Greg and Christy Gammon. Since I interviewed them, their lives have taken some interesting twists and turns, and their Bank On Yourself policies have come to the rescue in surprising ways.

This short video update, filmed during my national book tour, reveals the details. Just click the play button below…

No two Bank On Yourself plans (policies) are alike. Each is custom-tailored, so yours would be uniquely suited to your goals and dreams. It’s easy to find out what your bottom-line numbers and results could be. Simply request your free Analysis here… and take the first step towards taking back control of your financial future. Why not do it now, while it’s fresh on your mind?

Six Frequently Asked Questions about Bank On Yourself

November 13th, 2009 by Pamela Yellen | 14 Comments

I thought you might find it helpful to have the answers to the six questions about Bank On Yourself we’re most often asked – right at your fingertips.

How many of these questions have you been wondering about?

FAQ #1: How does Bank On Yourself compare with traditional investing and savings strategies?

You can compare the Bank On Yourself method to traditional investments here, including stocks and mutual funds, a 401(k), a ROTH plan, real estate, gold, commodities and several other investments.

If there’s a different financial product or strategy that you think can match or beat the Bank On Yourself method, I encourage you to take the $100,000 Challenge. If you’re right, you could pick up an easy $100K!

FAQ #2: How does Bank On Yourself let you recapture every penny you pay for major purchases like cars, vacations, business equipment or a college education?

I’ve summarized this in a short video overview of how Bank On Yourself works.

However, for a more detailed explanation, you’ll want to review Chapters 2, 6, and pages 52-54 of my best-selling book, Bank On Yourself. If you don’t have the book, we offer a 35% discount on it.

FAQ #3: I’ve heard people like Dave Ramsey and Suze Orman say whole life insurance is a lousy place to put your money. Is a Bank On Yourself-type policy different from the kind they’re talking about?

Videos reveal how Bank On Yourself turns dreams into reality

November 5th, 2009 by Pamela Yellen | Leave a Comment

I think you’ll find the two short videos I’ve posted here of special interest, if you’ve been wondering how you’re going to reach your financial goals in today’s challenging environment.

The first video (filmed during my national book tour) reveals how the Corey Family is using Bank On Yourself to accomplish a number of goals and dreams, including:

Funding their kids’ college educations without going broke
Getting back their real estate taxes… and the cost of custom-made furniture they bought for their home
Being on track to a six-figure-a-year retirement income they can predict and count on

Just click the play button below to find out how the Corey’s are doing all this…

Now find out how the Bowsher Family used Bank On Yourself to help raise $100,000 for their church

7 Really Scary Facts about Your 401(k)

October 29th, 2009 by Pamela Yellen | 17 Comments

Before you put another penny in a 401(k), find out what the government and your employer aren’t telling you that will scare the living daylights out of you! Here are seven frightening facts you should know about 401(k)s…

Frightening 401(k) Fact #1:

Your employer can – and probably is – making risky decisions on how to invest your money for you – without your knowledge or approval.

Watch Pamela Yellen being interviewed about the problems with 401(k)s on the #1 TV station in Los Angeles

Watch Pamela Yellen being interviewed about the problems with 401(k)s on the #1 TV station in Los Angeles

Many employers are now automatically directing more of your pay into your 401(k)… and automatically moving it into more risky investments – even if you had previously chosen your own investments!

And most of that money is being re-directed into “target-date” funds, which lost so much money during the last market crash, it sparked scrutiny from lawmakers and regulators. Many funds for people who pinned their hopes on retiring in one year had losses far exceeding 20%, and some funds suffered losses of 32 to 41 percent, according to Morningstar.

Shockingly, stock allocations among those funds were found to be 26%-72% of assets!

Not to mention that the fees charged by target-date funds are “significantly higher than those charged by other funds on plans’ investment menus”.

(Source: “Companies take reins of workers’ 401k’s”, MoneyCentral.msn.com, October 10, 2009)

The growth in a Bank on Yourself policy is both guaranteed and exponential. You can predict the minimum guaranteed value of the plan on the day you want to tap into it, and every point along the way.

Get Your FREE Report!

Get instant access to the FREE 18-page Special Report, The Ultimate Wealth-Building and Retirement Strategy, plus timely briefings and solutions to critical news and events that may impact your money and finances.

Frightening 401(k) Fact #2:

Get Your FREE Report!

The important decisions about your 401(k) are made by someone with no training or education in most companies.

Pamela Yellen interviewed on Sky Radio

October 22nd, 2009 by Pamela Yellen | Leave a Comment

Sky Radio recently did a 3-minute interview with Pamela Yellen on Bank On Yourself, and why it’s a more dependable, worry-free approach to saving for the future than conventional methods.

The interview will play on all audio-equipped flights on Virgin America and US Airways early next year, but you can listen to a sneak preview of it here.

Pamela Yellen and Bank On Yourself will also be featured in January in a video series on “The Innovators” that will be broadcast in prime time on the CNN Airport Network in 44 of the busiest U.S. airports.

We’ll post a preview of that video here as soon as it’s ready.

Enjoy! And please tell us what you think…

Smartest financial move ever made?

October 15th, 2009 by Pamela Yellen | 1 Comment

Recently, a senior editor of the respected personal finance publication, Kiplinger, described the best financial move he’s ever made:

My wisest move was buying whole life insurance in the 1990s, precisely when countless books and articles mocked whole life as obsolete. My wife, Debbie, did the same. In the ten-plus years that we’ve paid $5,000 a year combined into our policies, both from extremely sound mutual-insurance companies, we’ve built substantial five-figure cash values, can borrow from them instantly at virtually no cost and haven’t paid a cent of tax on the earnings.”¹

Like most people who have Bank On Yourself plans, Jeff’s only regret is probably that he didn’t put more into the policies!

It’s a virtual certainty that Jeff and Debbie’s policies are traditional dividend-paying whole life policies, rather than the specially-designed, super-charged variation used for the Bank On Yourself method.

Had Jeff and Debbie’s policies been designed the Bank On Yourself way, they’d have significantly more cash value now.

As the Dow moved through the 10,000 mark this week, a dose of reality is in order…

After reading the article, if you want more details about what Bank On Yourself is and how it works, you can get Pamela Yellen’s free Special Report here… or get Pamela’s best-selling Bank On Yourself book at a 35% discount here.