I had planned this week to write about generational wealth. However, between Thursday, Friday, and today – I feel compelled to talk about the volitivity that permeates the investment markets! The Matmatecum of course was designed with the presumption of a 2% average return over its lifetime. In addition is the certainty of no loss in the Members Money over that same period. Remember that the Mathmatecum is a nonprofit and its aim is to provide a lifetime of income to its members. It is also a guide to what to do with those monies and other income available. The overall aim is to obtain a good sum of passive income that can be used as a person ages.
In all the scenarios provided by most financial advisors they are often wont to say that even after markets have crashes or mini crashes they will eventually come back and that the market increases year over year long term near 10%. That is historically true. However, it does not allow for the suddenness of the crash and where each individual is financially when it occurs. The advisors fail to take into effect that after an extremely large loss, getting back to the same positions prior to the fall is only available to the few who are known as the financially fortunate. Defining financially fortunate as those who have large sums of money at their disposal. They are able to do this because some of their monies are being held in the most conservative investments available.
Rest assured all the Members Monies will be earning at the rate of 5.28% until 10\31\24! A rate of 1.37% is guaranteed over the next 30 years. The Federal Reserve has opted to not change their rates at present and will not apparently do so until September giving the Mathmatecum a full month to see where markets are.
Economists in the main believe they are not as precise as weathermen. I find this quite disheartening! I believe that as advisors and fiduciaries a conservative approach is mandated. Keys to success seem to be the ability to know where the money is and who makes markets.
JAI BABA
TTFN
JU
