Accumulation Planning

Accumulating assets is a crucial part of retirement planning. If you don't gain assets for retirement, you won't have a retirement. It's that simple. So what is a realistic return on your money? Some advisers say 8 - 12 percent. Others are more conservative at 6 - 8 percent. Which is right?

Actual vs. Average

Let's use history as a guide to help us understand what is realistic. When advisers tell you they can get you 8 - 12 percent, it's because they are using average returns instead of actual returns. For example, for the past 10, 20, and 30 year periods prior to 2016 the average and actual returns were:

 Average Actual
 10 Years 6.89% 5.09%
 20 Years 7.91% 6.2%
 30 Years 9.28% 7.87%

As you can see, the actual return is significantly lower than the average return. The sad thing is that it doesn't even include the fees that most accounts carry of anywhere from .5 - 1.5 percent. That also has you assuming all of the risk, so if there's a downturn in the market your account reflects that, which can be detrimental when you are close to retirement.

The Right Strategy

Choosing the right strategy for you is made up of several parts. We need to understand your retirement goals, your risk tolerance, and current situation to create a good accumulation plan. Just throwing your money somewhere without a plan is like saying, "Just put it all on black." It usually doesn't work out. 


Contact us to create your own, customized accumulation plan so that you can have a good idea of what you'll have instead of hoping you'll have it.