You don’t often hear the word trillion thrown around, unless we’re talking about the U.S. debt or GDP. But there’s another number that consistently lands in the 12-zero club: the total net assets of the US mutual fund industry. At nearly $27 trillion in 2021, it’s a whole lot of Money; and its rapid Growth is causing a whole lot of problems for retirees. 

What’s the Big Deal? 

Let’s put this into perspective. Retirement as we know it today is a relatively recent development in human history. Though the first modern mutual fund launched in the US in 1924, mutual funds didn’t become a mainstream investment option for the average American until the 1980s and 1990s. That means in the span of just a few decades, the US mutual fund industry amassed assets greater than the annual GDP of several industrialized nations combined.  

Helping fuel this growth was the advent of financial advisors, a profession that exploded in response to the rapid changes in the financial services industry. Pensions began to disappear, 401ks made their debut, and IRAs became a household term. Mutual funds were sold as the answer. The problem is that the strategy hasn’t changed. 

Stuck in the 1990s 

A lot has happened since then. No one watches a movie on VHS anymore. Cell phones do more than just make calls. And getting on the internet no longer requires an extra phone line. But the prevailing investment advice for retirees remains the same: mucho mutual funds.   

To be fair, mutual funds do have a place in your retirement strategy. But today we know there are other strategies that need to be in place, too. Overlooking these strategies can be disastrous. For example, we know some of the greatest risks to retirees include: 

• Overlooking tax liability on their 401k & IRA accounts
• Not making market risk adjustments at retirement 
• Hidden, ongoing and unnecessary advisor and investment fees 
• The skyrocketing cost of long-term care 

Financial Advisors Haven’t Gotten the Memo 

Mutual funds alone aren’t going to solve for the risks above. Yet somehow, financial advisors are stuck in the past. That’s why we’re sounding the alarm. The mutual fund industry continues to grow, but awareness of these other important strategies is not. Unfortunately, that failure to modernize is as problematic as trying to update your computer’s operating system with a floppy disc.  

Today there’s a better way. It’s called the retirement planner. If you’re in or near retirement and don’t yet have one, give us a call or request your Roadmap for Retirement online. Though we can’t help with your prized VHS collection, we can bring your retirement strategy out of the 90s.  

Read more about how the financial industry has exploited retirees in our new #1 Amazon Bestseller: Fire Your Financial Advisor: 40 Years of Greed and Exploitation of the American Retiree and How You Can Fight Back.

Greg Aler Founder of Golden Reserve and Author of Fire Your Financial Advisor

Greg Aler was born and raised in small town Ohio. College. Law School. Then off to one of the largest law firms in the world. Later, he went on to build three multi-million-dollar companies before the age of 40 – an elder care law firm, a financial services firm, and a real estate company. He is a perpetual disruptor; re-thinking and re-building industries that are too rich or too stubborn to change. Yet always, coming back to his roots and directing his companies (and his book) to fight for the people that get overlooked – hard-working everyday folks, like his parents. The other 95%-ers.

Greg has his own TV, Radio & Podcast Show—Expedition Retirement.

The only thing Greg loves more than cooking, scuba diving, boating and laughing with friends on his back porch, is being with his wife Fernanda, and three kiddos (Lilly, Lola & Louie).