My Smart Retirement

Our world is full of myths. We use them to make sense of things. The financial world is no different. On today’s episode, we are going to explore some common financial myths and deconstruct the valuable information we can learn from each. Myth #1: Shifting from stocks to bonds removes the volatility from your portfolio. On a basic level, bonds are going to be less volatile than most stocks. But we have to remember that bonds don’t have principal protection so they depend on interest rates. If you bought a bond and interest rates went up and you sell your bond you may end up with less money. The volatility with bonds just looks different than the risk associated with investing in stocks. Myth #2: Once you are retired life insurance is no longer necessary. This certainly isn’t true for everyone. Do you still have people who are depending on you financially? This might be children or a spouse. Life insurance can also be a form of protection against long-term care costs. Myth #3: You will need less income when yo