Beware of The Fatigue Factor And Magic Pill Pushers

Beware The Fatigue Factor and Magic Pill Pushers When You Transition to Retirement

Confronting something that requires a greater level of focus can be physically, mentally, and psychologically taxing.  The longer that required focus persists, the more taxing it can become.

A potential negative byproduct of this can be a “fatigue” factor kicking in, and the common and costly mistakes that can follow as a result.

This fatigue factor has definitely been known to kick in during times heightened stock market volatility, especially if a) you were not prepared and properly positioned with a long-term system to begin with, or b) you still “check out the market” several times each day. 

Those who fall into one or both of these camps are a perfect target for the Magic Pill Pushers who always emerge during heightened stock market volatility environments. 

Magic Pill Pushers

You can set your watch to it.  Each time stock market prices temporarily plunge, the marketing departments of two industries kick into high gear with Magic Pill solutions:

  1. Gold and other Precious Metals
  2. Annuities

Each of these is marketed as the solution to the “problem” of the volatile and “risky” stock market.  Before digging a little deeper into gold and annuities, the first principle to always keep at the forefront of our minds is that any attempt to suppress short term volatility correspondingly suppresses long term returns. (You may want to take a second to read that again)

Gold and Annuities

The popularity of any non-currency-based asset like Gold always rises during turbulent markets and ensuing government spending as the fear of rising inflation enters the equation.  While a strong case can be made for the fear of inflation, gold has been a terrible investment for those looking to outpace inflation.  Fortunately, a fairly simple Google search can demonstrate this. 

The same can’t be said for the history of annuities.  If you have been a steady reader of RETIREMENT GAME PLAN over the years, you know my feeling about annuities.  While they do provide a tool in your planning toolbox, for the most part, the overwhelming majority of annuities marketed today are very complicated, expensive, restrictive, and they are grossly oversold.  (One of the reasons they are oversold is they pay very large commissions to agents and advisors who sell them.)

Here’s an example of language used in a Jackson National Life annuity advertisement on page one of the Wall Street Journal during a recent market correction acknowledging this reality:

“Sound too good to be true?  It’s important to remember that unlike any other investment product, annuities were created by insurance companies, which have the unique ability to offer features and add-on options that help protect us against outliving our savings or having to drastically change our lifestyle in retirement.”

And then:

“Annuities have been available for a long time, and it’s true that they can be complicated to understand and even challenging for advisors to sell in today’s regulatory environment. But that should never be a reason for investors or advisors to forgo consideration of something so critical as guaranteed lifetime income.”  (I have taken the liberty of bolding this last sentence)

Doesn’t the phrase “guaranteed lifetime income” sound so attractive?  Who wouldn’t want that???

What is omitted in this advertisement is the cost to you for providing this “guaranteed lifetime income.” 


“There are numerous annuity options you can choose that can be customized to meet your needs.  For example, some annuities start paying a lifetime income stream immediately, while others allow that income stream to be deferred to a time in the future.  And with the purchase of a lifetime income benefit, an annuity is the only investment that can provide a steady stream of lifetime income unaffected by market downturns.  In fact, that income even has the potential to keep growing.”

As all insurance companies do when they market annuities, they are preying on the average American’s fear of financial market corrections and volatility which is a very effective marketing strategy on their part. 

You simply don’t want to fall prey to it!

As we have discussed in great detail, market volatility and corrections are nothing to fear for the rational, long-term investor if you employ a strategic plan.  Not only are they not something to fear, but intelligent investors welcome them!

Jackson National Life recognizes these realities, so the ad attempts to deal with them. 

The bottom line is to always have your eyes wide open when reading advertisements like this, and to beware of “magic pill” offers especially during times like these when the “fatigue factor” can easily kick in!

As much as we would all love a “magic pill” as this Jackson advertisement attempts to imply, there is no such thing.

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