July 03, 2019

Tending To Your Retirement Garden

10 minutes

What does retirement planning have in common with growing a garden? Both need patience, vision, determination, and the proper tools to succeed. Eric Peterson explores all the comparisons on this week’s podcast.

Show notes: https://petersonfg.com/tending-to-your-retirement-garden/

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1:06 Plants don’t grow overnight

If you want to have a BLT for dinner, you can’t buy a tomato plant and stick it in the ground and expect to eat tomato that evening.

A lot of clients who retire want to go into gardening because it’s something that you do almost every day but also something that makes you focus on a longer-term goal. Some people struggle, however, with that level of patience. This is true in a lot of younger people who don’t have enough of a long-term focus and don’t see how they need to build up their financial future.

4:18 Keep the weeds and pests away

If you don’t pull the weeds in your garden, they’ll take it over and choke out your plants and prevent them from growing.

In the financial world, hidden fees are the weeds.

Keep in mind which investments carry fees. If you’re investing in things like stocks and mutual funds, there are fees present and you need to be aware of their existence.

You can’t always eliminate weeds or fees, but you can at least keep them under control and in check.

Unlike weeds, which aren’t really ever helpful, fees can still be worth paying if you’re getting good value from the service or strategy to make them worth it.

7:00 You need the right tool for the right task

Your neighbors would laugh at you if they caught you trying to use a water hose to dig a hole or if they found you watering your plants by scooping tiny amounts of water out of a bucket with a shovel and dumping the water on the plants.

For a financial parallel, consider CDs and money market accounts. These aren’t designed for long-term investing or keeping up with inflation. That doesn’t mean they’re terrible tools, they just aren’t right for that job or responsibility. So, don’t shun a tool just because you don’t understand it, or you’ve used it for the wrong function in the past.

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By Eric Peterson

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