SOURCE: DeYoe Wealth Management

DeYoe Wealth Management

June 15, 2009 13:02 ET

Dad's Investment Strategies Might Not Be Cause for Baby Boomers to Celebrate on Father's Day

BERKELEY, CA--(Marketwire - June 15, 2009) - For many Baby Boomers, Father's Day brings to mind fond memories of dear old dad and some of the wonderful life lessons he imparted. However, when it comes to investment strategies, Jonathan DeYoe of DeYoe Wealth Management in Berkeley, California, says father probably didn't know best about retirement planning.

"It pays to understand why retirement planning strategies born out of the Great Depression will not be effective in today's tumultuous economy," says DeYoe. He offers the following reasons why.

Don't Count On A Pension Plan

Many parents of Baby Boomers worked for a company for decades and received a pension plan in retirement. Along with the pension and the fact that life expectancy was shorter, no future financial planning was necessary. Today, most boomers don't have a pension, or have one that will likely be reduced in the future. That fact, combined with the likelihood that Baby Boomers could live for upwards of 35 years in retirement, makes planning a necessity, something that most are not doing. According to the November 2008 Nataxis Global Investors Survey, only about 40% of Baby Boomers have done any written financial planning. Yet many of those respondents replied in the negative when asked whether they had addressed some of the most fundamental financial planning questions such as: "Have you accounted for increased cost of living in your financial plan?" "Have you considered implications of Long Term Care needs?" or "Have you factored in the possibility that you might find yourself financially responsible for a parent who has outlived his or her money?"

Following Dad's Savings Strategies Won't Keep Pace With Inflation

Parents of baby boomers grew up during or just after the Great Depression. They saved money in coffee cans or CDs and preached the evils of the stock market. As a result, many boomers perceive the market as too risky, which could end up being a financial mistake. In a normal inflation environment, income will have to triple in retirement to keep pace with the increased cost of living. CDs and coffee can savings won't produce the desired results. Once you factor in inflation and an increase in average life expectancy, unless you are truly wealthy you should definitely consider having at least some equity participation in the great businesses of the US and the World. Used judiciously, stocks can be a valuable tool, as they offer ample opportunity for an increase to one's income that will hopefully match or exceed the increasing cost of living.

"Since stocks do fluctuate in value, I wouldn't advocate dumping all of one's money into the stock market, but I do believe that there is a place for ownership in great companies with solid track records in almost every long-term portfolio. The key to a successful retirement is adequate planning and being disciplined about consistently funding your long-term plan," says DeYoe. "That practice is something that today's parents can pass down to their children to learn from and reflect on in future Father's Day celebrations."

About DeYoe Wealth Management

DeYoe Wealth Management is a holistic wealth management firm that helps clients make the right decisions for their financial futures. Services provided include wealth planning, trust services, tax planning, risk management planning, legacy and estate planning and philanthropic planning. Jonathan DeYoe is a Chartered Private Wealth Advisor and an LPL Financial Registered Principal. Securities and Financial Planning offered through LPL Financial, Member FINRA/SIPC. For more information, go to

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