.floatimg-left-hort { float:left; } .floatimg-left-caption-hort { float:left; margin-bottom:10px; width:300px; margin-right:10px; clear:left;} .floatimg-left-vert { float:left; margin-top:10px; margin-right:15px; width:200px;} .floatimg-left-caption-vert { float:left; margin-right:10px; margin-bottom:10px; font-size: 12px; width:200px;} .floatimg-right-hort { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 300px;} .floatimg-right-caption-hort { float:left; margin-right:10px; margin-bottom:10px; width: 300px; font-size: 12px; } .floatimg-right-vert { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 200px;} .floatimg-right-caption-vert { float:left; margin-right:10px; margin-bottom:10px; width: 200px; font-size: 12px; } .floatimgright-sidebar { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 200px; border-top-style: double; border-top-color: black; border-bottom-style: double; border-bottom-color: black;} .floatimgright-sidebar p { line-height: 115%; text-indent: 10px; } .floatimgright-sidebar h4 { font-variant:small-caps; } .pullquote { float:right; margin-top:10px; margin-left:10px; margin-bottom:10px; width: 150px; background: url(http://www.dmbusinessdaily.com/DAILY/editorial/extras/closequote.gif) no-repeat bottom right !important ; line-height: 150%; font-size: 125%; border-top: 1px solid; border-bottom: 1px solid;} .floatvidleft { float:left; margin-bottom:10px; width:325px; margin-right:10px; clear:left;} .floatvidright { float:right; margin-bottom:10px; width:325px; margin-right:10px; clear:left;}
Dear Readers:

There are common myths I hear frequently from readers who are reluctant to be more responsible in planning for their retirement. Many of you who think you will retire in 20 years or so must be mindful that “retirement planning” is a verb and not a noun. It’s sad that so many will passively allow events to determine the quality of their “after 66 years.” They believe that Social Security and their retirement plans will suffice or that they will be able to work until they drop. The six most common myths are:

WHEN I RETIRE, MY LIVING COSTS WILL BE LESS: Balderdash! That may be true if you are willing to reduce your standard of living. But I promise you that food costs, medical care, transportation, clothing, insurance, dental care, etc., are guaranteed to rise. Some of you may not have a mortgage, but I also promise you that taxes, insurance and home maintenance are certain to cost a lot more.

MY TAXES WILL BE LOWER: Horse feathers! Don’t count on it! Retirees never figured that they’d pay taxes on their Social Security income, which became a reality in 1984. The 15 percent tax on dividend income is certain to rise, and so are taxes on gasoline, cigarettes, cell phones, etc., and the Obama government is considering a value-added tax. Federal and state income taxes also will rise to run the governments and pay the interest on their various debts.

OUR CHILDREN WILL HELP US: Tommyrot. Don’t count on that either. Children can be unexpectedly selfish and possessive. Due to the “downsizing” of America, today’s children will probably earn less than their parents. As prices increase (I guarantee they will), those kids are going to have a tough time paying the butcher, the baker, the bankster and the candlestick maker.

I MUST CONSERVE MY PRINCIPAL: Twaddle. Your goal should be to conserve your purchasing power, which is what an experienced money manager can do for you. Inflation is the deadliest of the seven sins. It’s not what you earn on your money that matters; it’s what you keep over and above inflation that really counts. You must recognize that “real inflation,” not the 1 percent folderol Washington feeds us, is certain to explode in the coming three to four years.

SOCIAL SECURITY AND MY COMPANY RETIREMENT PLAN WILL PROVIDE FOR ME: Bushwa! It’s suicide if you rely on Social Security and Medicare to be as generous to you as it was for your parents. These programs are trillions of dollars in arrears with no solution except the old saw: higher taxes and lower benefits. You can’t count on your company retirement plan either. The future performance of the stock market will hardly match the vigor of its past performance. The stock market has decimated most retirement plans, and many corporations are canceling current plans and replacing them with cheaper benefits. Many Americans in their 40s and 50s will be left swinging in the wind.

MY HOME EQUITY IS MY RETIREMENT FUND: Hogwash! Home prices don’t always rise. The past two years are a grim reminder of that. When home prices do rise, so do most other living costs. After you’ve used up your savings, you can’t sell your home one room at a time and dine off the proceeds. And if you sell your home using the proceeds to move to smaller quarters, you’re essentially reducing the quality of your standard of living.

Most Americans don’t take retirement seriously because we believed we could rely on Social Security, company retirement plans and the equity in our homes. Well, Social Security and Medicare are bankrupt, retirement plans have been pummeled by Wall Street’s cupidity, and home prices will continue to flounder like a fleet of sinking boats. Retirement is now a life-or-death decision. We must take a continuous and assiduous interest in our retirement future, because the next 20 years will create dynamic social and economic changes that will knock the socks off your feet. It ain’t going to be pretty, and there won’t be a second chance if you fail to take an active role in your retirement future.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, Fla. 33775 or e-mail him at mjberko@yahoo.com. © 2009 Creators.Com