Real Estate

Why Warren Buffett’s Prescription Will Not Work for Retirees

In a Fortune article titled “Why Stocks Beat Gold and Bonds,” Warren Buffett provides a glimpse of his upcoming shareholder letter.

While Buffett’s advice is perfect for investors who have a long-term perspective, anyone near or in retirement may want to think twice about acting on the prescription.

The core of Buffett’s advice is as follows:

Risks in Reverse Mortgage Market Lead to Wells Fargo Exit

Bloomberg reports that Wells Fargo Bank is exiting the reverse mortgage market.

Wells is apparently concerned about the risk of further declines in residential real estate prices.

A reverse mortgage puts a bank like Wells Fargo in the role of lender with the home serving as the asset or collateral for the loan.

Further declines in home values put the bank at risk since the asset base against which they are lending is shrinking while their obligation stays the same.

Billion Prices Project Provides Real-Time Alternative to Consumer Price Index

Anyone concerned about inflation and inflation risk should take a look at the Billion Prices Project -- a set of real-time inflation indexes that provide an important alternative to the consumer price index (CPI).

The BPP databases show prices in the United States soaring at a rate well above what is indicated by the CPI. This decoupling has been especially evident over the past several months.

DTCC Uses Technology to Drive Cost Savings and Efficiency in the Retirement Income Industry

Adam J. Bryan is Managing Director and General Manager of the Depository Trust and Clearing Corporation’s (DTCC) Insurance &Retirement Services.

DTCC’s Insurance and Retirement business unit is the central messaging hub for annuity transactions and a partner and leader with the insurance industry in the effort to automate, standardize and centralize the processing, monitoring and reporting for insurance products.

National Retirement Risk Index

The National Retirement Risk Index is available through the Center for Retirement Research at Boston College.

The Index is intended to show the share of American households that are at risk of not being able to maintain their pre-retirement standard of living in retirement.

Inflation and Fixed Indexed Annuities

This forum thread is a continuation of a conversation that began as a comment and can be found here:

http://www.annuitydigest.com/blog/tom/fixed-annuity-sales-continue-soar-while-massive-inflation-risks-are-ignored#comment-363

The comment came from Phillip Hawley and is as follows:

Finding a Hedge for a Phantom

Is a nasty inflation brewing or is the U.S. facing a prolonged deflationary period similar to what Japan has experienced for the past twenty years?

Billions of dollars and major public policy decisions are currently positioned for both scenarios.

The need for further deficit spending and low interest rates is advocated by Paul Krugman's "Phantom Menace" comments and a recent piece by Teresa Ghilarducci.

National Retirement Index Shows Majority of Americans at Risk

The Center for Retirement Research at Boston College maintains a national retirement index that measures the percentage of Americans who are at risk of being unable to maintain their standard of living in retirement.

The most recent index results, which incorporate the impact of the financial crisis, reveal that 51 percent of Americans are at risk of being unable to maintain their standard of living in retirement.

This is a 7 percent increase from the previous index results.

Thinking About Withdrawal and Income Strategies in Retirement

There is a very good article in Investment News about retirement planning and, more specifically, devising appropriate withdrawal and income strategies in retirement.

The author discusses the nature of various income requirements and makes the entirely appropriate point that all income needs are not created equal.

For example, travel desires obviously differ from essentials such as food and shelter.

SEC Puts Stop to Ponzi Scheme Focused on Elderly in the Detroit Area

The SEC put a stop to a $50 million real estate focused Ponzi scheme that targeted elderly investors in the Detroit area.

John Bravata and Richard Trabulsy apparently lured more than 400 elderly investors with the promise of safe 8% - 12% returns. Many of the investors were solicited with "free lunch" seminars.

The reality of the situation, however, was very different than what was promised:

Buying Guide

Click below to browse our free annuity buying guide and learn how to choose the best annuity.

buying guide

Find Products

Click below to research and compare annuity products. You may also add or edit an annuity product listing.

find products

Find Financial Advisors

Click below to find financial advisors who provide annuities and retirement planning services. You may also add or edit a financial advisor profile.

find advisors

Find Companies

Click below to find companies that provide products and services in the area of annuities and retirement planning. You may also add or edit a company listing.

find companies