Stay on your retirement planning track and consider iBonds

Posted By on June 25, 2022

It is stomach-churning to follow the often heard “hold tight” and “stick with the plan” advice often given by financial advisors.  If you are currently retired and living off of a fix-income and nest egg, or are trying to prepare for retirement, DownMarketArrowyou are likely worried about times like these. Advisors tell you not to panic, and that with a properly allocated portfolio, markets will come back. Still, it is not easy to see 401-Ks and IRA portfolios shrink and years of savings disappear due to inflationary pressure in every area of the economy … especially the essential ones … like food, housing and energy. SheldonBreathingPaperBag_aniEach day the market sells off further, which can make ordinarily calm people search for a paper bag or act as if they are a nervous chipmunk. Perhaps that is why so many questions and articles are peppering the financial press these days?

Just a cursory look at the ill-preparedness of today’s retirement population will either gives you a feeling that you are not alone … or hopefully … see yourself better prepared than others?

How many months of inflation, stagflation or a recession can we weather? According to a Senior Living article last month, “most retirees aren’t sitting on a nest egg the size of Fort Knox … median savings for ages 55-64 is just $104,000 and for those aged 65-74 it’s $148,000.”  One can only hope most of them have equity in their house, some assets to sell, maybe a pension (teachers, government, military) or at least a solid social security check and a plan to keep expenses low (ie. live on less)?

The point being is that some preparation is better than no preparation … and that if you are still working, focus on funding a diversified retirement savings portfolio. That means, don’t put all your eggs in one basket. A mix of investments that include growth and income, tech and consumer staples, energy and yes … even some bonds. We should all have some kind of emergency fund, normal savings and value accumulated in real estate (a home). If you’re ahead of the game, fund a 401K or IRA and maybe even some crypto, although if you don’t have money to lose … I’d avoid that last one. This year might be a good time to set up a Treasury Direct account and learn about iBonds (the yearly limit means starting younger and a contribution each year will give an account time to grow). Consider Series I Bonds as one more piece of your “saving for retirement” puzzle.



Desultory - des-uhl-tawr-ee, -tohr-ee

  1. lacking in consistency, constancy, or visible order, disconnected; fitful: desultory conversation.
  2. digressing from or unconnected with the main subject; random: a desultory remark.