When it comes to retirement, one expert believes that too many people are making a critical mistake that could cost them dearly in the future. Ted Bauman, Editor of The Bauman Letter believes that the average investor is miscalculating their net worth. This miscalculation may be the reason why many people retire with much less than they anticipated.
In a recent blog article entitled, Don’t Make This Retirement Mistake,” Mr. Bauman lays out how many people mistake the price of something with its value. Price, as defined by Bauman, is what people pay for an item. And value is what is the perceived worth of the product. This price/value relationship can become increasing warped when the element of time comes into play. That is because price usually becomes detached from its value over a set amount of time.
One example in the article mentions a toy that was once popular with little kids – fidget spinners. At the height of the craze, fidget spinners were being sold at high prices. Now, that the fidget spinner fad has died, the price of these toys have fallen off of a cliff and landed down in the clearance bin. Check this article at Bloomberg.com to know more about Ted Bauman
Using a more practical application, many couples project the future value of their home as a way to fund their retirement. Bauman warns that rising inequality may mean that future young families won’t be able to afford homes at the price future retirees think they can sell them at. The result? A massive shortfall for couples who won’t have the money to retire comfortably.
Ted Bauman points out that young couples today have about half the net worth of the previous generation at the same stage of their life. That, in turns, means that young couples are more likely to rent than to buy a home. An oversupply of homes will lead to downward pressure on home prices.
Ted Bauman has been a part of Banyan Hill Publishing since 2013. As the Editor of The Bauman Letter, Plan B Club and The Alpha Letter, Mr. Bauman has offered his advice on everything from low-risk investment strategies to asset protection.
Fo r more information, CLICK:https://plus.google.com/+TedBaumanGuru