The USA Can't Afford A Recession So We'll Print Trillions

[00:00:00]Look, we all know it. The reality is the United States cannot afford a recession.

[00:00:05]So, what's the alternative? We're going to print trillions of dollars. And let me tell you why I feel this way. Here's what our debt clock looks like. Thank you to usdebtclock.org.

[00:00:18]And let me ask you a question. If you were facing nearly $40 trillion in debt, and you controlled the money printing presses, what would you do?

[00:00:30]Of course, you're going to print more money. But, the problem with that is if you print more money, it's going to cause inflation, which is why it's important that each and every one of us, every investor considers what would happen to your portfolio if inflation stays where it's at now or continues to go higher. It's critically important because we've worked 20, 30, 40 years to save this money. Most of us have it invested portfolio of stocks and bonds.

[00:01:02]And what's going to happen to the stocks? And what's going to happen to the bonds? If we haven't met yet, my name's Assu Wells. I was a financial advisor for over 20 years before I retired myself. And this YouTube channel has grown into the number one YouTube channel in the entire United States that focuses on retirement. So, if you're interested in retirement, if you're interested in your investments, if you're interested in things that impact people 50 and older, you're in the right place. Welcome aboard. So, let's jump in and let's talk about this. We're going to start off with an article by Fidelity. It's called how to beat inflation, 10 tips. And we're going to start with the the most important one, I think of the 10, is Fidelity says to add inflation-resistant building blocks, both on the stock side and also on the bond side. And before we talk about the stock side, we have to talk about the bonds, because bonds often make up a sizable part of a portfolio for people like us that are 50 and older. So, let's let's look at what Fidelity has to say. The first thing they say, which I think is very wise, is to be selective with your bonds. And And here's why. They say that traditional bonds can struggle when inflation and interest rates both rise together. And there's three areas that they want us to focus on. The first one is a word called duration. Just think about your airline flight. If the duration of the flight is how long it takes, it's the same thing for bonds. Duration is just a fancy way of saying, is it a 1-year bond or a a bond that matures in 1 year, 3 year, 5 year? How long is it until you get paid back the initial money that you invested. So, the first one is to look at duration, and the reason is let's say you buy a bond that's currently paying 4%. And let's say interest rates rise to 6%. Well, your bond is worth less, right? Because your bond pays Somebody that had $100,000 is not going to pay you $100,000 for your bond if it's only paying $4,000 a year, which is a 4% interest rate, when they can buy a different $100,000 bond that's currently paying $6,000 if interest rates go from 4% to 6. So, hopefully that makes sense. Your bond is worth less, and the longer you're locked in until you get paid back your money, right? If you're going to get your money back in a month, it's not that big of a deal to be stuck in a 4% bond in that situation. But if you're locked into that for 10 years, that is a big deal.

[00:03:50]So, you're going to see the value of your bond go down. So, hopefully that makes sense. And related to that, Fidelity says consider a mix of shorter-term bonds and also inflation-linked bonds like Treasury Inflation-Protected Securities. We're not going to go into what TIPS are, the Treasury Inflation-Protected Securities, but I do want you to know that they exist. I want to put it on your radar screen so you can dig deeper and look into that if that's something that you're interested in. And the third thing Fidelity says is really important, which is to keep your bond allocations aligned with your risk tolerance, your time horizon, and your income needs.

[00:04:34]They also remind us that bonds can still play an important role in your portfolio, but their job may change in higher inflation environment. So, it's not unusual for somebody 50 and older to have 20%, 30%, maybe even 40% of their portfolio in bonds. So, bonds are a big piece of this. I should say none of this is financial advice. I don't know your situation, but I can uh with 20 years of experience tell you there's some things that should be on your radar screen, and that's the purpose of this video is is to share these things. Okay, now we're almost ready to deep dive into the investments that have historically done better in high inflation uh periods, but before we go there, I I first want you to think about how does inflation affect you personally? And here's why. Not all inflation hits equally. Housing, insurance, transportation often rise faster than the headline number that we see in the in the news. So, just because the news says inflation is 3 and 1/2% to make up a number, it doesn't mean that's going to be how inflation is going to impact you. For instance, if you're paying rent, highly likely inflation is going to impact you more than somebody that owns their house and they have a fixed rate mortgage. It Even if you own your house, you're still going to be impacted by repair costs, you're still going to be impacted potentially by rising property costs, you're still going to be impacted by homeowners insurance. So, you're not completely protected, but you're not as much at risk as somebody that's renting where the rate can change on a monthly basis or on an annual basis. And one of the biggest factors that get impacted by inflation is health care insurance.

[00:06:31]Unfortunately, health care insurance is rising at a rate faster than inflation.

[00:06:36]And even with Medicare as we approach 65, Fidelity tells us the average couple needs to plan on over 350,000 dollars in costs from the time they're 65 until they they pass away as a couple in total outside of what Medicare covers. And that's why I'm proud to partner with today's video sponsor, Chapter. Chapter is the only Medicare advisor that I recommend and I like Chapter for three reasons. Again, they're a Medicare advisor. Medicare is complex, so I I do urge you to think about talking to a Medicare advisor.

[00:07:15]Again, I like Chapter for three reasons.

[00:07:18]The first is their services are always free to you. The second reason is I believe they have your best interests in mind. They they have access to all the plans and they've set up their organization and their team really to incentivize them to listen first, to understand your situation, and based on your situation to make the suggestions based on what's best for your specific situation. And the third reason I like chapter candidly is they save their average client over a thousand dollars a year.

[00:07:52]And then also I like chapter because of great reviews I receive back from viewers like this one here. This is what a reviewer said, "Contacting chapter is one of the best decisions I have made.

[00:08:05]My advisor Kim is a beautiful soul who is extremely knowledgeable, kind, caring, and enjoyable, and generally has my best interests at heart." You can read the rest of the review, but that's the type of situation that I want you to experience when you call a Medicare advisor. So I urge you to call the the advisor that got this review, which is chapter. Pro tip, try calling chapter for faster service 323-805-8579.

[00:08:36]If you're approaching 65, if you're thinking about Medicare, if you're thinking about your options, chapter's a great place to start. Thank you chapter again for sponsoring this video. Okay, now let's talk about investments that have historically done better in high inflation periods. We talked about the bond side of our investment portfolio, now we're going to talk about that the stocks, the equities, the growth side of the portfolio. And these are investments that have have historically done better than inflation. Now I do have to say just because they've done better in inflation in the past, it doesn't mean that they're going to continue to do so, but it's a great place to start. So Fidelity says commodity producers such as energy and materials, value stocks, US and international stocks, real estate investment trusts, which are a way that the average person can invest in real estate different sections. You could invest like in in office space, you could invest through nursing homes, whatever focus within real estate, residential real estate that you want exposure to, you can do this with a a public wrapper around that's in available on the public markets. And then on the fixed income side, we talked about the Treasury inflation protected securities tips. We talked about shorter duration bonds and they also say potentially some higher yielding bonds. And then other diversifiers might be gold. Could also be your own personal real estate or making direct real estate investments. They say there's no silver bullet, but diversifying across across different inflation resisted assets can help protect your buying power keep up in high inflationary periods. So that's what Fidelity says. Now what do I say?

[00:10:32]I I say that there's two things that we can do to protect ourselves if inflation stays high. The first we've talked about which is look at your asset allocation and the specific investments both within the bond side of your portfolio, but also on the the growth the the stock side of your portfolio and ask yourself how will those specific investments do. The second thing you can do is to come up with a written financial plan where you can run scenarios and say what happens if inflation takes off. You know, here's different investment portfolios and and let's run a scenario and see am I protected in that? And having a written financial is plan is so important that there's three ways that if you want a written financial plan, I can make it super easy for you to get one. The first is is for those of you in my audience that like to do it yourself.

[00:11:28]Which I understand you've worked 30, 40 years to build this nest egg. Many people want to control the plan that talks about that investment. And if that's you, use the planning software I trust, Bolden. There's a free 2-week trial at the link showing up now, and it supports the channel because I'm an affiliate. The second is what I call do it with me or do it with a soul, which is my 4-week retirement sprint. And in just four short weeks, we will build your plan together in a group setting.

[00:12:00]And at the end of that, you'll leave with a plan and the confidence that comes from having thought through the issues that it takes to create a well-thought-out financial plan. This is likely going to sell out because of the size of my YouTube channel. So, if you're interested in joining me for this 4-week retirement sprint, be sure to join the waitlist at the link below.

[00:12:22]And the third one is what I call done for you, um which is a service that I'm offering, advisor intro by a soul. It's a free service where I will connect you with a financial advisor. So, the plan is done for you, and you have a relationship with an advisor that you and the advisor can walk forward together and make a series of good financial decisions, no matter what the market throws at you. Um and if you'd like my help finding a financial advisor, be sure to read the disclosure below, and you can join the early access waitlist at the link showing up. Also, all of these links are available in the description section for this video. And if you want to go deeper right now, what I suggest is watch this video next. Why waiting until 65 to retire might be a big mistake. Thanks for watching this video. I'll see you in the next one.

[00:13:17]Bye-bye.