Economics is the social science that studies economic activity to gain an understanding of the processes that govern the production, distribution and consumption of goods and services within an economy.
— The Economist’s Dictionary of Economics
In the world of finance, economics truly has its place. But what does economics have to do with retirement? Well, everything. Because it’s often said that the central purpose of economic activity is the production of goods and services to satisfy our ever changing needs and wants, then why would these ever changing needs and wants change after retirement?
They change because the world’s most basic economic problem ends up being about two things: scarcity and choice. These two sometimes disastrous attributes directly affect everyone both before and after retirement. In this uncertain economic world filled with scarcity and choice, new or soon-to-be retirees then must consider…
- What goods and services can they afford, when the economy uses its resources to raise the prices of healthcare, living expenses, and taxes? Should retirees be expected to just sit idly by while the cost of living greatly exceeds the monthly allowance their government-sanctioned retirement provides?
- How best to survive the ever-rising costs of living, within the means provided by a basic 401k-retirement plan? What would be the best use of such scarce monthly resources? Should additional stocks and bonds be sold to provide more (taxable) income?
- What is the percentage of unnecessary fees being paid on big name mutual fund holdings? Are they ok with the amount of money their financial advisors makes on their investments?
- Will they be able to afford expensive prolonged hospital treatment – or not? What are the costs and consequences of long-term disability without the appropriate insurance planning?
During this week’s installment of the David Lukas Show, David and Zach discuss how beneficial a general knowledge of economics is when planning your retirement strategy. Learn the steps necessary for a WorryFree Retirement® by listening to the entire episode now!
To learn more about how Fixed and Index Annuities can benefit you and your retirement portfolio, call David Lukas, (501) 218-8880, at David Lukas Financial. David has partnered with Tony and his WorryFree Retirement® network to help his clients implement the WorryFree Retirement® process. It’s unlike anything else in the industry.
Do you know your financial DNA? Are you a Saver, an Investor or a Speculator? Learn about the three personalities of money and take the test today at: 3Personalities.com