Is Your Retirement Plan Doomed?
The real reason short-term market volatility should not be ignored
This is not another sensational article decrying doom and gloom over a week’s worth of down markets. It is a principled look at the effects of ignoring short-term losses because of a misguided faith in “investing for the long term.”
The financial industry has sold us a beautiful dream: Work hard, invest 15% of your income in your 401(k), and ride the market to millionaire status by retirement. Easy-peasy!
Yet Federal Reserve data from 2023 tells a starkly different story: 90% of first-time retirees have less than $1,000,000 saved. For most Americans, the dream of a comfortable retirement remains just that—a dream.
Why is this happening? Because life happens all along the way, not at the end of a 30-year accumulation period.
The Dream They Sold You vs. The Reality You Live
We've all heard the mantra: "Invest for the long term." Financial advisors paint pictures of exponential growth charts and the magic of compound interest. And yes, in theory, investing consistently in the market should build substantial wealth over decades.
You deserve this, by the way. A retirement where money is abundant, where you can travel, help your grandchildren with college, and never worry about medical bills or assisted living costs.
But here's what they don't emphasize: short-term requirements can kill off long-term results.
When Life Interrupts Your Investment Plan
Let's be honest about why so many retirement accounts fall short:
Your child needed unexpected medical treatment
Your roof started leaking during an economic downturn
You found yourself unemployed for 8 months when the economy contracted
A once-in-a-lifetime business opportunity required immediate capital
Your aging parents needed financial support
(PS - I have personally experienced a variation of every one of these.)
These aren't failures of discipline or planning—they're normal life events that happen to everyone. The true failure lies in a financial system that preaches long-term investing without acknowledging the inevitable short-term needs that derail these plans.
The Market Doesn't Care About Your Timeline
Remember 2022? The S&P 500 down 20%, NASDAQ down 30%. Or perhaps you recall 2008, when retirement accounts lost 30-50% of their value virtually overnight.
The DotCom bust and the Great Recession were the two that hit me the hardest. Two major economic downturns in the first 10 years of my working life.
The biggest problem with economic downturns is that they often coincide with job losses and other financial pressures, forcing many to withdraw retirement funds at the worst possible moment.
This is the cruel irony of the "average returns" myth. Yes, the market historically returns 8-12% annually on average, but you don’t get the average. You get what you get. And it’s meaningless, anyway, if you're forced to sell during the inevitable downturns.
What The Financial Industry Doesn't Want You To Know
Why do financial advisors focus almost exclusively on long-term investing? I don’t think there’s anything purposely nefarious going on. It’s just kinda their job.
The financial industry has 4 Rules. They want you to:
Contribute money to them
On an ongoing basis
To hold for as long as possible
And then distribute the money back to you in a limited manner
Just think about your 401(k); you know the above is true.
The industry has you give up control of your money and then benefits when you believe your financial shortfalls are personal failures rather than predictable outcomes of the status quo.
Taking Back Control of Your Financial Future
The good news? You can protect yourself from this flawed system. Here's how:
Prioritize YOUR financial system first. You must retain control over your capital.
Build your financial foundation before maximizing retirement contributions.
Maintain significant liquidity to not only pay the bills if times get tough but also take advantage of opportunities when there is proverbial “blood in the streets.”
Invest for cash flow. Buy stocks if you must, but focus as much as possible on buying assets that generate income.
Become your own banker. The business of banking is far superior to the business of investing.
The Path Forward
The financial establishment wants you to believe that long-term investing is all you need and that any shortfall in retirement is your failure.
Reject this narrative.
The 90% of retirees with less than $1 million saved aren't all undisciplined spenders—they're normal people who faced life's inevitable challenges and lacked a financial strategy robust enough to accommodate both long-term growth and short-term needs.
By acknowledging this reality and adjusting your approach, you can build financial resilience that serves you through life's predictable unpredictability, not just in some distant, idealized retirement future.
Your financial journey deserves a strategy that works in the real world—not just in theoretical models designed to make you feel inadequate when life inevitably happens.
StackedLife Podcast
Episode 10: How Much Do You Need to Get Started with Infinite Banking?
In this episode, I tackle one of the most common questions I receive: "How much money do you need to get started with Infinite Banking?"
In addition to some hard numbers, I explain the practical ranges, introduce my "Goldilocks Rule" for finding the perfect policy balance, and share strategies for kickstarting your IBC journey regardless of your current financial situation.
Whether you have a few hundred or a few hundred thousand dollars to commit, you'll learn how to think about the right starting point for IBC.
I’m John Perrings, Authorized Infinite Banking Practitioner and founder of StackedLife. Instead of taking high risk to get a high return, we help our clients implement strategies that create multiple safe returns with the same money repeatedly. It’s geometric compounding that we call Stacked Interest Acceleration, and IBC is the first step.
I’ve implemented IBC for hundreds of my clients and educated thousands more via my podcast, articles, and courses at StackedLife.com.
Want to work with me? Schedule a free consultation here.