The one big question asked by almost every baby boomer that has a nest egg is, ” Will my nest egg be enough to live on in my retirement?”

This is one of the initial questions in Greg Heiple’s new Book BalanceZone Investing. Although he puts it another way. “How do I make sure that I do not out-live my saving?”

Greg is the creator of The Teeter Totter Principle which I have already mentioned on this blog as being an excellent tool for understanding and managing your nest egg.

BalanceZone is version 2.0 of the Teeter Totter Principle. It comprises a 214 page book that goes into some detail to explain what BalanceZone Investing is all about. Plus there are two software programs.

He talks a lot about navigating the “Investment-to-Retirement Road” and says that with an understanding of BalanceZone Investing and by using its tools you should be able to successfully navigate your way to retirement income success.

The software comprises two programs.

• BalanceZone Investment Decision Skill Builder
• Investment Statement Consolidator

The main theme you need to grasp is that you should always separate risk-based assets like equities from safe assets like bonds. Greg says you need to categorize your assets into two parts: safe savings and risk investments.

The Skill Builder is designed to help you learn how to manage the balance between the two categories over time. In the process of using the Skill Builder you will learn what risk tolerance you really are comfortable with especially when you see your nest egg reducing because you risk too much or the risk based results suddenly take a large portion of your nest egg simulating a stock market decline.

The Skill Builder does:

• A great job of managing fear and wise buy and sell decisions.
• It educates Baby Boomers on how much money they can take from their nest egg without depleting it.

Once you have built your skills using the Skill Builder you can then use the Investment Statement Consolidator to enter all the totals from your different investments into either the safe or the risk Account columns. It will then give you a current picture of your BalanceZone.

If that BalanceZone is not what you are comfortable with based on your Skill Builder training you need to then plan how you are going to adjust your investments to achieve the BalanceZone you want. You can either do this yourself or with your trusted financial planner

There are a couple of important points worth making here. Greg says it is important to watch the BalanceZone Balance NOT the $ Balance. I have also said on this blog that by watching the $ balance of a Portfolio the safe assets can hide the risk-based assets losses so you get lolled into a false sense of security.

Right now in Australia we are told the average loss on a Balanced Portfolio is only -6.4%. But I have shown that my friend’s portfolio is down 22.9% on his risk-based assets. This is what you need to find out about your portfolio.

The BalanceZone Skill Builder can be used for FREE at Balance Zone Investing. I strongly urge you all to try it and learn how to balance safe and risk-based assets in your nest egg.

As soon as I have the details on where to get the book and the software programs I will let you know.

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Here is my latest bates retirement income strategy model #2. You can check out retirement income strategy model #1 and compare them.

As I learn more from my research I find the picture of what I need to do becomes clearer. So I have decided to revise my model and it is shown below.

This is what I think will work for me. It may not suit all Baby Boomers but I find simple diagrams and pictures give me a better understanding of what I need to achieve.

(A large diagram is displayed later in the Post)

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You need to separate your safe investments from your risk-based investments in retirement. This I learned from Greg Heiple of the Teeter Totter Principle. TTP is a simple method of helping you balance your safe investments like cash and fixed interest against your risk-based investments like equity mutual funds and stocks.

Greg gives a very real example of the traditional way of managing your nest egg egg in retirement. Try playing with his Free TTP Responsibility Calculator to get a “feel” for what he is talking about. Also take a look at the Teeter Totter Principle presentation.

What should strike you about it is the simplicity of it all. But there is more to it than that.

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From some of the emails and comments I have been getting it is plain to me I need to redefine what my blog is about.

This blog is all about how to protect your retirement nest egg if you have one when you are close to or actually in retirement. Rule #1 is avoid large losses in retirement. If you have many years to go then you should consider putting a bigger percentage of your nest egg into risk-based investments like equity funds or stocks once the market settles down again. This blog may not be of use to people far from retirement right now. Read the rest of this entry »

A Baby Boomer friend of mine has sent me his WRAP Account results through to June 2008. We both decided in November 2006 that we would hand our retirement nest eggs over to the “Professionals” so we could spend our time doing other things as we move into semi-retirement.

Our retirement nest eggs were put straight into a diversified portfolio of mutual funds within a few days of giving our financial planner our money.

It turns out that our timing could not have been any worse. From November 2006 through to November 2007 the markets became more volatile. Property was in the doldrums already but then we got hit with International fixed interest losses because the Aussie dollar was rising against the US Dollar. Then we got hit again with dropping interest rates in the USA. The International share losses offset the Australian share gains to give us zero returns.

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We Baby Boomer need a list of Financial Planners who genuinely want to help us protect our Nest Egg in retirement, avoid large losses and make it last as long as we do.

In my research on how to protect my nest egg in retirement I have come across three so far that I believe are moving in the right direction or have systems in place now that are designed to protect my nest egg.

Each take a very different approach,but all display a genuine aim to help us protect our retirement nest eggs and all have a system they use or promote to manage our nest eggs.

They are all financial planners but they are independent thinkers and are not mutual fund sales people masquerading as financial planners.

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The Teeter Totter Principle is all about using a “seesaw” to balance your Nest Egg’s cash and investments. Greg Heiple a financial planner, created the Teeter Totter Principle for managing your Retirement Nest Egg after seeing what happened to some of his clients in the 2000-2003 stock market down-turn. He gives an example of of a couple retiring in 1999 and doing all the recommended things with their Nest Egg but ending up losing 30% of their Nest Egg by 2003. He realised there must be a better way to manage his clients Nest Eggs in retirement. His research led to the creation of the Teeter Totter Principle.

Don’t be fooled by its simplicity. It is a great tools for protecting your Nest Egg in Retirement.

The Teeter Totter Principle has several benefits for Retirees:

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