CARE

Carter Bank&Tr [Va]

Retirement

What Too Much Risk Really "Looks" Like and Why You Should Care

by

Many investors think that having "too much" risk isn't a big deal…

… until it hits "home."

That's the case for 6.2 million American who have invested roughly $224 billion in Fidelity's Freedom Funds and who recently found out – the hard way – just how much risk the fund managers have taken on to boost performance… arguably, without telling them.

The Freedom Funds, in case you are not familiar with 'em, are Fidelity's largest retirement fund grouping and worth more than $1 billion a year in management and fee revenue to the Boston-based financial services company.

Based on "target dates," the Freedom Funds are supposed to be a one-size, easy-to-use investment that diversifies investments and automatically manages risks by reducing them as fund participants age.

When you're young, for example, you might choose the Fidelity Freedom 2060 Fund as a way to set it and forget it for the next 42 years. Somebody only two years away from retirement, by contrast, may opt for the Fidelity Freedom 2020 Fund.

The appeal is terrific.

Over time you're supposed to get great performance and decreasing volatility – risk by any other name – that ensures your hard-earned retirement funds will be there when it's time to call it quits.

Hence, the "targeted date" moniker.

Here's why I'm not a fan of target date funds - and you shouldn't be ether...

The Fed

Why I Don't Care About Jerome Powell, and Why You Shouldn't Either

by

The other day reader Mike M. asked in our comments section:

Hi Lee – What do you think of this Powell fellow as Fed Chair? It appears from an article I read that he is fond of the TBTF bailout.

Mike, you are not the only one to ask me this question. In fact, people right here at Money Map Press have been asking me. No doubt, the entire world wants to know. CNBC talking heads talk about it. The Wall Street Journal and Bloomberg and Reuters have probably written great tomes about it.

When asked a question to which everyone wants an answer, I always give it great thought. And I always think about the Fed chair, no matter who he or she is.

I usually end up not thinking much of them, Bernanke especially. He destroyed the lives of millions of senior citizens by taking away the interest income they depended on to supplement their Social Security. I despised Bernanke for that alone, not to mention the massive money printing that benefited only the bankers and speculators. Yellen I liked better. Other Fed critics, including some who are my friends, may still skewer her. I give her credit for stopping the madness.

Now here's what I know, and what is most important for you to know about Jerome Powell. They call him Jay. Other than that, nothing. That's right, nothing.

I'm going to tell you why and what you DO need to know...