Lesson #1- Robert Kiyosaki, author of Rich Dad, Poor Dad and numerous other books and articles said “ It is easy to stay the same but it is hard to change. Most people choose to stay the same all their lives.” George is in his 60’s and near retirement and has been investing the same way all of his life. He has been snake-bit numerous times with losses but chooses still to not hedge his investments properly, leaving his entire retirement plan at risk. George may very likely be dealing with the pain of regret since he has chosen to not go through the uncomfortable process of change.
$100,000-$0(28% loss avoided through guarantees)= $100,000 after year 1 l
$100,000+$5,000(5%)=$105,000 after year 2 gains of 5%
$105,000+$5,250(5%)=$110,250 after year 3 gains of 5%
$110,250+$5,512(5%)=$115,762 after year 4 gains of 5%