The biggest concern for many retired people, as well as those nearing retirement, is establishing and protecting their nest egg so that they are able to feel secure financially and enjoy their retirement. Market Watch recently featured an article that offered four tips for retirees and pre-retirees to protect their nest egg.
- Taking a lump sum can be risky, so be cautious of a financial advisor that promises to maintain your principal and recommends a lump sum distribution.
- When creating a portfolio, you should establish what types of investments you are willing to participate in. Many retirees tend to go with low-risk investments, in which their money most often is safer. If these types of investments are your goal and you see a questionable investment made by your broker or adviser, contact the firm immediately and question the purchase.
- Know your broker’s commission on any annuity trade, as well as the reason for the trade. Annuities often bring the broker a high commission, so be aware of reasons for trades in order to discourage broker misconduct.
- With the volatility of today’s market, the words “maintain diversification” are even more important than in the past.
With the numbers of retirement age individuals exceeding 35.4 million and the upcoming 77 million baby boomers rapidly approaching retirement age, there is absolutely no reason for investment advisers to overlook age and circumstance considerations that will affect suitability. Investment advisers are held to the more strict fiduciary duty in which they have a legal obligation to make decisions that are in the best interest of the client, as opposed to the broker’s suitability standard, in which the broker must only make “suitable” investments.
After all, the adviser should be protecting your nest egg, not their own.
If you are a retiree who has lost money due to unsuitable investments made by an adviser, contact an investment attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.