Diversification

01

How happy are you with the "Diversification" your broker has in your retirement account? You need to learn about the "diversification lie."

Somewhere along the way brokers convinced us that if we split our retirement funds between tech stocks, financials, pharmaceuticals, etc., that this is "diversification." With the huge swings in the stock market over the last few years, it has become obvious that if your retirement funds are tied to the overall market you are not really diversified. When one area is down, another area is supposed to be up. Nobody really considered what would happen if everything went down. Now we know.

Know Your Options

When IRAs were introduced in the 80's, the banks and brokerage houses immediately took the lead. It did not take long for investors to get the idea that stocks, bonds, and mutual funds were the only allowable investments in your retirement accounts. It is no coincidence that the banks and brokers made commissions on every one of these transactions. They only allowed us to invest our retirement funds into investments THEY made money on. Virtually all investors did not know then that those investments which created commissions for the banks were only a tiny fraction of the investments you can make with your retirement accounts.

Get Smart

You earned the money you have in your retirement account (if you have any left). If you were capable of putting the money into your account, you are more than capable of taking charge of what happens to it.