Lawrence E. Fischer

Financial  -  Blog


With the first wave of baby boomers (born between 1946 and 1964), having celebrated their 60th birthday and either already retired or planning for retirement in the next 5-10 years, the transfer of employer-directed pensions, 401(K)s and other similar retirement accounts will reach heightened numbers  never before seen in history.  One Prognosticator opined that such transfers would exceed $15 billion dollars in the next decade.  This phenomenon will require that those who are fortunate to have such accounts will possess the knowledge and wisdom in properly investing them.

One of America’s foremost authorities has challenged Wall Street’s standard classification of the financial world as only “stocks or bonds.”  Jack Marrion is a recent look titled Safe Money Places:  An Educational Journeybelieves the proper division of the financial world is “safe money places” and “risk money places”.  Through my legal counseling of people who have lost money in the Stock Market I became alarmed at how many seemingly careful, prudent and wise people over 50 years of age are still disproportionally in the risk money places.  It was incidents like these meetings that convinced me to become a financial advisor to assist people who were either less risk tolerant or who, after losing significant portions of their principal, wanted to explore other options to preserve their principal while still receiving interest that would exceed the rate of inflation.

As a registered investment advisor, I get paid by the hour for objectively advising my clients with their investments.  Broker/ dealer companies and portfolio managers are not going to emphasize safe money places because they make more or all their money with at-risk individuals.  You might ask, what are the cardinal principals I need to follow in being a prudent, wise investor?  I would suggest three cardinal rules to follow:

(1)  Follow at a minimum the Rule of 100.  Take 100 less your age.  Put a % after the resultant figure (for example, you are 50 years of age. 100-50=50). No more than 50% of total investments should be at risk (the possibility of losing any of your principal).

(2)      Using the above example, take 50% of your investments and transfer them into two “buckets”.  The first “bucket” is your emergency money you can get your hands on quickly.  It’s the money guaranteed not to lose on dime of principal.  I recommend a good money market account.  Find this “bucket” with the equivalent of 10 months of your monthly net salary, or if you are retired, 10 months of your monthly budgeted needs.  With the remainder of the 50% no-risk money, make an appointment with me, and I’ll explain all you should know about equity indexed annuities.  (These are not variable annuities, subject to market losses).

Put this remainder in one or more equity indexed annuities (EIAs).  You can ladder them in separate accounts that have different maturity dates (Ex. 5 year, 7 year, and 10 year Annuity).  EIAs are great places for money you do not contemplate needing for the term you choose. 

The 10 year term EIAs often pay a bonus on day one for opening the account.  Make certain this bonus is “vested” at least within one year of the beginning date you open the account.  These products are tax – deferred which provides a triple compounding of interest – another feature I really like!

(3)  With the remaining 50% of investments (in accordance with our example above), build a pyramid of different types of at-risk products with the most risky products at the top of the pyramid (so they constitute the smallest percentage of your portfolio).  Financial advisors call this method of investing the barbell strategy.

Implementing these three steps will assure that you have enough money for these unforeseen contingencies, have some long-term monies in safe places that are tax deferred and the rest of your monies in a layered at-risk products that will hopefully earn significant interest for you in the long term.  (Remember, those who leave their money in diversified portfolios of quality stock will usually reap the benefits of better performance than those who repeatedly are in and out of the market).

May 25, 2018




In late October of 2015, the International Monetary Fund (IMF) is scheduled to meet to determine, among other matters, if the US dollar will remain as the global reserve currency preferred in international trade. Several scholars and financial gurus have opined that this decision, if it does occur, may usher in a drastic devaluation of the US dollar.


James Rickards in his book “The Death of Money” (Portfolio/Penguin Publishers 2014) details the demise of the dollar. Rickards spent years working as one of the CIA’s most trusted financial experts analyzing international trade, terrorist related hacking and manipulation of the world’s financial markets. After reading this book, I wonder where our investments can be safe for future retirement.


My good friend and financial colleague, Steve Johnson of Ashton Royce in Williamsburg, Virginia, suggests there is no currency or “bucket” of multiple currencies that the IMF can use which may be stronger or safer than the US dollar. His viewpoint suggests if there is a financial collapse in the US, it won’t be due to the dollar being exchanged for other currencies as the global reserve currencies.


Look to see what the IMF decides to do at its October 2015 meeting.


Food for thought.


September 24, 2015