Motivations of Baby Boomer Entrepreneurs in the Hospitality Industry
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Baby Boomer Blunders 1by Douglas R. Andrew
w w w . b a b y b o o m e r b l u n d e r s . c o m
Baby Boomer Blunders
Ten Financial Mistakes You Can Correct
Before Its Too Late
and retire in dignity
2009 by Douglas R. Andrew
www.missedfortune.com
E-Book Design by: Kim Reynolds www.Kimbolt.com
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Thank you!
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Baby Boomer Blunders 2by Douglas R. Andrew
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W ay s to connect
www.missedfortuneblog.com
Tune in to Dougs weekly Radio broadcast:
www.missedfortuneradio.com
http://feeds.feedburner.com/missedfortuneradio
Missed Fortune:
Isnt It Time You Became Wealthy?
Missed Fortune 101:
A Starter Kit to Becoming a Millionaire
Last Chance M illionaire:
Its Not Too Late to Become Wealthy
Missed Fortune 101 (Spanish)
Convertirte en Millonario
Millionaire by Thirty:
The Quickest Path to Early Financial
Books by Dougl as R. And r ew
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Baby Boomer Blunders 1by Douglas R. Andrew
w w w . b a b y b o o m e r b l u n d e r s . c o m
The Problem
Overcome Baby Boomer Blunders
If Only Baby Boomers Could See Things Differently
Blunder #1: Using short-term investments for long range goals
Blunder #7: IRAs and 401(k)s are the best way to save for retirement
Blunder #10: I think of retirement as a time to coast
Understand the Three Lodging Places for Money
Understand the Three Marvels of Wealth Accumulation
About The Last Chance Millionaire
About the Author
Page 1
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Page 5
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Baby Boomer Blunders 1by Douglas R. Andrew
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I f w e take a la te r et i r ement and anear ly death , wel l j ust squeak by.
THE PROBLEM? The average Baby Boomer has less than
diminish their nest egg. The solution? Social Security isnt the
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cerned that they havent saved enoughthat they may out-
last their retirement resources. Many have seen their retire-
many are concerned that their nest eggs are draining faster
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layoff workers to cut costs during the recession. Still others
Is that en rio little too close o ome t get lau h
o tofy u?If so,youv got pl nt of comp y. hether
e eryonewi lha eeno ghmoney to retire isaquesti n
thatloo slargetodayf r 78m ll ion meric st eBa y
B omer bo n b tween 1946 and 19 4. Th crisi ? Most
B omer wil nothavee ough cc m l atedforret rement
tomeet eirnee s,l et lonethei r ants.
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Baby Boomer Blunders 2by Douglas R. Andrew
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former home. Many have witnessed that equity dimin-
house is not nearly as marketable as it was a few years ago.
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you having to work harder for your money. It wont matter
chance may indeed be your best chance to becoming a mil-
lionaire!
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Baby Boomer Blunders by Douglas R. Andrew
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WH Y ARE MANY-
blunder for some is not squirreling away enough money dur-
bounty later on.
As m an y as 40 per cent hav e saved al m ost
nothing, one expert told a Congressional
panel recently. These people wil l not have
enough to meet their needs in their golden
y ear s, let a l one th eir w ant s.
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retirement savings.
to you?
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gone down in value.
I would love a vacation condo or cabinbut I cant af-
ford one yetIm waiting until I retire to buy it.
I have bought and sold investments at the wrong time.
I have not matched the right investment vehicles with
I have tried to time the market to get ahead faster. -
B A B Y B O O M ER OVERCOME
BLUNDERSBLUNDERS
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Baby Boomer Blunders 4by Douglas R. Andrew
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and values.
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vels of wealth accumulation.
all for.
blunders.
W hy Boomer s Are Laxabout Planning for Retiremen t
RAISED AFTER W ORLD WAR II, Boomers bring to
a nest egg away. They tend to have the attitude: If I want
worry about tomorrow when tomorrow comes. Having wit-
This false sense of security is the reason that it comes as
the mistakes of big business.
in an individuals unique skills and the ability to stay mar-
ketable.
The result is that older Boomers think it might be too late to
be enough time to save something. (In theory there is still
life; saving is not.
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Baby Boomer Blunders 5by Douglas R. Andrew
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non-essentials every single day and are cautious about their
William D. Danko documented the common money-saving
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the thermostat in the summer so the air conditioner didnt
have to work so hard (and cost so much!).
often have no clue where their money really goes.
If Only Boomer s Could SeeThings Differently
themselves.
Have you known someone who reacted to downsizing by
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tribute during their golden years. If they only knew how to
Those with determination and resilience are sometimes
that was a member of the Fortune 1000. Then came shrunk-
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Baby Boomer Blunders 6by Douglas R. Andrew
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but he walked around angry at the world. His marriage fell
him three years to come to the realization that he had not-
sess had become obsolete.
Anyone faced with such a situation can get frustrated.
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Blunder #1: Using short-term investmen ts for
long-range goals; and long-term investments
This may be the biggest mistake I come across in well-inten-tioned families.
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is not a great idea for your retirement nest egg.
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Baby Boomer Blunders 7by Douglas R. Andrew
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investments. It seemed to make sense because returns were
them for 2.9 years.
money out of what is really a long-term investment to buy a
Everybody commits this blunder at one time or another. Ill
show you that neither this blunder nor these other common
retirement.
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teen or twenty years after r etirem ent.
The fastest growing new segment of American society today
than they thought they would.
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cy for someone already age 65 was about another 12 years.
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might think: Ill be dead by then.
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Baby Boomer Blunders 8by Douglas R. Andrew
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even though they assured me they would be dead by now.And these are not even Baby Boomers!
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assumed that rarely would anybody live beyond age 95. As a
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already talk of increasing it to 140!
The problem wi th underest imat ing your own l i fe expectancy is you often underesti-
mate the amount o f re t i rement funds you
wi l l need to last the rest of your l i fe. The
r ea l i t y is, y ou w i l l l i kely need m ore m oney
than you th ink .
Blunder #3: I believe paying off m y house w ill
give m e peace of m ind.
when loans and mortgages were called due even though they
mortgage.
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Baby Boomer Blunders 9by Douglas R. Andrew
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able income if you are not writing a check each month to thebank. But theres a hitch. Uncle Sam offers that deduction
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Those w ho pay of f their m or tgage begin to
r ea l ize w i th i n a y ear o r tw o tha t they cou ld
use a new ta x br eak . They a lso di scover th at
by handi ng over a l l t hat m oney t o the bank,
th er es a l ot of l azy , idl e cash stashed aw ay
in th at pa id-of f house.
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down in value.
-self so that you dont
in mind that the money
you use for home mort-
-tion.
But what about leaving
the house to the kids?
you ask. Isnt that our
money. Those kids concerned about getting the house after
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Baby Boomer Blunders 10by Douglas R. Andrew
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Blun der #4: My $100,000 -$300,000 nes t
egg is going to be enou gh at retirem ent.
nothing. I have clients who start out thinking: Were set
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cent.
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Consider this. Even though half a million dollars may seem
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than by the golden goose.
Blunder #5: Ill be in a lower tax bracke t
wh en I retire.
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Baby Boomer Blunders 11by Douglas R. Andrew
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in deductions that you used to get. So you remain in the
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is less.
Blunder #6: Deferring taxes on retirement
funds saves me taxes.
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run out of money!
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Baby Boomer Blunders 12by Douglas R. Andrew
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Are you p lann i ng your r et i r ement
or Un cle Sam s?
Now what if you could set aside 100-cent dollars on the front
end and take out 100-cent dollars on the back end? Your
strategies wherein you can create a retirement fund using
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diebased on the same income distributions.
Are you p lann i ng your r et i r ement
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Baby Boomer Blunders by Douglas R. Andrew
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Phases of Retirement Planning
Contribution Accumulation Distribution Transfer
Taxed-As-Earned Investments
After Tax Taxed Gain Taxed Taxed
Non Qualified Tax-Deferred Investments
After Tax Tax Favored Gain Taxed Taxed
Traditional IRAs and 401(k)s
Tax Favored Tax Favored Taxed Taxed
Non-Qualified Alternative
After Tax Tax Favored Tax Favored Tax Favored
Home Equity Retirement Planning
Tax Favored Tax Favored Tax Favored Tax Favored
Blunder #7: IRAs and 401(k)s are the bestway to save for retirem ent.
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Baby Boomer Blunders 14by Douglas R. Andrew
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their contributions to IRAs and 401(k)s. When they start to
Uncle Sam now offers you another choiceRoth IRAs and
still too many strings attached.
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about IRAs and 401(k)s than you have received from your
K eep Your M i nd Open To The Possi bi l i ty
That Ther e M ight Be Sm ar ter Al ter nat i ves
Blunder #8: If I reach the a ge of 59 or 70and don t need m y IRA and 401(k) mon ey, Ill
just let it sit ther e.
have much more money if they let most of their money stay
there rather than transferring it out somewhere else. Post-
is the deadline before Uncle Sam starts charging you a big
until age 70 is a bad idea. Its like refusing to change the
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Baby Boomer Blunders 15by Douglas R. Andrew
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Most advisors also dont understand that you can strategi-
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strategic rollout. (For more information on strategic roll-
Missed Fortune 101.)
Blunder #9: I view retirement as a time for
of retirement. Wouldnt it be better to do the things you
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conservative attitude when they retire. They are afraid they
but have lost their good health and cant do the things they
you may lose the energy or the desire to go globetrotting and
to smell the roses along the way.
Blunde r #10: I think of retirem ent as a time
to coast.
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Baby Boomer Blunders 16by Douglas R. Andrew
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chises located all over the world.
celebrating our wedding anniversary every February in
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and today tens of thousands of gallons are made monthly
but his ice cream legacy lives on and is managed by his son
Michael.
assembling widgets. Start now to discover your marketabil-
a market for their hard-earned wisdom. I have a friend who
stress.
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being useful.
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Baby Boomer Blunders 17by Douglas R. Andrew
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or even a simmering talent for music or art that has been
on the back burnerthis is the time to share what you have
service for your church or a charitable foundation such as a
Uh-oh. I ve Done Ever y th i ng W r ong!
I W ont Be Able t o Cat ch U p.
that its not too late to learn how to make course corrections
and start navigating in the right direction. You can over-
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1. Understand the Three Lodging Places for Money
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their risk tolerance:
Low riskthe safest and most conservative and includes money
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Moderate risk
real estateboth residential and commercial. Most real
High riskand would include investments like growth mutual
funds. This category is generally viewed as having the
greatest risk.
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Baby Boomer Blunders 18by Douglas R. Andrew
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market conditions.
and earning an attractive rate of return.
-volved.
it wont matter. You can make money when your house goes
what your house once gained) if it goes down in value.
market. Your cash can be invested safely in conservative
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ment. You can have the best of both worlds: take advantage
When I invest my serious cash that is earmarked for my
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structures that house stocks (houses made of straw) and real
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Baby Boomer Blunders 19by Douglas R. Andrew
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without my money actually lodged there.
How can this be accomplished?
I also sock away money earmarked for retirement savings
into the same insurance contracts rather than into tradition-
al retirement savings accounts like IRAs and 401(k)s. In-
when the market goes down) by having my returns linked to
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York Times best-seller the week after it was released. To take
2. Understand the Three Marvels of Wealth Accum ulation
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retirement.
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Baby Boomer Blunders 20by Douglas R. Andrew
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The keys are:
weight
lift
thrust
drag
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more quickly than you may think. You can become your own
banker by doing what banks and credit unions do to amass
wealthborrow money at a lower rate and invest it at a
higher rate.
thrust force must be greater than or equal to the drag force.
lift
thrust
drag
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Baby Boomer Blunders 21by Douglas R. Andrew
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same retirement income stream.
Drag is the force of resistance caused by the body of the
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as a loan or a mortgage from a bank. To make your wealth
to wealth accumulation. If you read The Last Chance Mil-
H ow The Last Chance M i l l i onai r e W i l l H elp
in Your Ret i r em ent Planni ng
I know many of you are feeling the darkness of night as
to reveal the brightness of dayyour brilliant futurefull
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Baby Boomer Blunders 22by Douglas R. Andrew
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The Last Chance Millionaire will give you new direction. It
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do it now!
Aut hor Note:
some money accumulated in IRAs and 401(k)s and some
discretionary income each month to set aside for retire-
retirement income within ten years. Through case studies
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monthly cash outlay. The Last Chance Millionaire can give
income that can last as long as you do.
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About t he Aut hor-
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Wealth on the family balance sheet.