QUESTION “WHY” WITH YOUR INVESTMENTS.

When my daughter Jaimee came into my office some years back and announced her decision to join the Marines, my first response was, “Why? Why the military? Why the Marines? Why not the Air Force? And why leave such a nice opportunity here at the family business?” But Jaimee had always wanted to do something really special and she especially wanted to serve her country. So she turned the question back on me and said, “Why wouldn’t I?”
 
One of the most important questions in life can be “Why?” It is the question that challenges tradition and opens discussion on that which has always been accepted. The current commandant of the US Marine Corp, Robert Neller, has spent his career asking the question, “Why?” The Marines have long been the world’s most respected, and feared, fighting force, yet Neller contends that it is necessary to continually ask “Why do we do it this way?” and “Is there a better way?” Neller often bumps up against long standing Marine tradition to which he replies “The expectation is that we will always go undefeated.” And so change, though sometimes “Terrifying” (his words), is necessary.
 
I often ask my clients to consider making changes with the hope that they too may remain “undefeated” in their goal to retire successfully. I ask them to question “Why?” as they consider their various investments: Why did I do it this way? Why do I keep doing it this way, and should I be changing how I am doing it?
 
One of the biggest examples was years ago when we had to start moving some funds away from traditional bank savings vehicles. For years, banks paid 5.25% on insured savings accounts, and people had become very comfortable with them. My grandmother had 100% of her savings at the bank and when I questioned her about diversifying she replied that she had no reason to. And she was right. All four of my grandparents passed away from natural causes before the age of 75. With less than 10 years spent in retirement, the amount saved and the rate of return was less significant than it is now.
 
In addition to living decades longer, the current generations are intent on working less, playing more, travelling more and generally spending more. The retirement dreams of the present generation simply won’t work with the math of the past.
 
Most of my WW2 clients are gone. As I consider the way they lived, the way they invested and the way they retired, I can see that what was successful for them will not likely be successful for their grandchildren. The world has changed. The numbers have changed. The way of life has changed and the retirement battle has changed. For the next generation to remain “undefeated” in that battle, they must change too. And this begins with looking at every investment and every strategy on a regular basis and asking the question, “Why?” And then being willing, if necessary, to follow the path the answer takes you down.