what you need and what you want. “If Farr hopes those individuals ages 6. Your odds of consistently beating the
you were to stop working tomorrow, 55 and over already have larger pools pros are extremely small, so seek out
would you know how much money you of money assembled. If not, they’ll need companies with solid track records,
would need to continue the lifestyle you to come up with a more aggressive plan. and strong management, and buy
enjoy today?” he asks. In other words, “We can use a higher portion of equities them at reasonable valuation.
have you saved enough? Now, think how as opposed to bonds,” he says. “And then 7. Stocks have gone up consistently over
much compounding would help. Let’s say we can figure out approximately how the long term, so don’t get cute. That’s
you have $10,000 right now to invest in much longer they are going to need to a good way to lose your [butt].
your retirement. Imagine what you could work before they can retire comfortably.” 8. Buy quality, and then hold it for a
do with $30,000. Farr’s system is designed really long time.
to double your current savings every
The 8 rules for protecting
seven years or so, which means the more
your assets Be prepared, get aggressive
money you save, the more money you
Once you have a plan in place, Farr You simply cannot be over-prepared
will be able to make, and the quicker
recommends monitoring and protecting today. There are so many unpredictable
you will get to that $1 million dollars —
your assets using his patented system of factors with which you’ll have to
and beyond.
“Farr’s Rules.” contend as you get older, such as
Finally, you need to determine how
1. Take a humble approach to investing. your health, Social Security, and
to achieve your goal, using the assets 2. Be prepared to be wrong and willing familial support.
you have. “We are going to talk about to do your homework. Think now about restructuring
investing mostly in equities, which over 3. Know what you don’t know. Being a your current strategy to include a more
the long term should grow at [a com- brain surgeon doesn’t qualify you to aggressive savings plan to ensure you’ll
pounded rate of] 10 percent or better,” invest in technology stocks. have the same comfort tomorrow as
says Farr. “A high-quality stock portfolio 4. What you read in the paper and see you’re currently enjoying today. You
is no more volatile than a high-quality on the news is already factored into need to ask yourself, “Is $1 million
bond portfolio, therefore younger people a stock’s price. really going to be enough?”
[those ages 35 to 45] should go with the 5. Markets move very quickly and Eric J. Leech can be reached at
higher-yielding instrument.” unpredictably.
ejleech007@comcast.com
growingwealthmag.com I Growing Wealth I July 08 I 43
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