Good News in a Bear Market

Good News in a Bear Market

October 03, 2022
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These are certainly challenging times... First-Half FUBAR: Stocks Worst In 60 Years, Bonds & Bitcoin Worst Ever

In bear markets, the market will do everything it can to suck us in and destroy our capital. It’s what bear markets do. It’s the nature of them.  

And those in the 'retirement red zone' are especially at risk - this is the most dangerous time to suffer a market loss...

So, how to balance? 

There are a number of approaches to creating balance. A 'strategic rollout' means you move your money out of risk over time, to achieve a minimum-risk, minimum-tax portfolio. 

Using indexing, you wouldn’t have lost a dime this year due to the plummeting stock market values.

The next 10 years are likely going to see chaotic ups and downs, as well. Don’t be a victim of volatility; use volatility to your advantage.

Indexing can give you the ability to protect your principal against loss and grow your nest egg competitively.

INDEXING = PROTECTION

Essentially, indexing insulates you from market bubbles. It gives your money a safe harbor where stormy seas of volatility can’t sink your retirement ship.

This short video explains how it works with a simple example.

With indexing:

  • Your money is linked to the market so that when the stock market performs well, you participate in the market gains. At the same time, if the market loses, your money is protected with a guaranteed floor.
  • Your cash value will receive an indexing credit, based on the market/index that you select. When that market grows during a segment, which is commonly 12 months, your cash value will be credited with interest.
  • If the market you are tied to experiences large losses, like 2022, your cash value won’t decrease due to market performance. The downside risk is eliminated because of a guaranteed floor. Because your money is not in the market, but linked to the market, and because of the guaranteed floor, it is safe and secure.
  • Any gains from a previous period are locked in and protected against loss, even if the index you are tied to loses in future segments. Each and every year this resets, so gains are added to the principal and never lost due to market performance.