What You Need to Know About Gold, 401ks, and Retirement Planning
When it comes to personal finance, a few voices stand out for their clarity and experience—and Ric Edelman is one of them. In a recent discussion, Ric tackled everything from gold and Social Security to investment strategies for people on a limited income. Here’s a breakdown of the biggest takeaways and how they can help you build a smarter, more secure financial future.
Gold Isn’t the Golden Ticket
Gold often gets glorified as a safe haven investment—but Ric doesn’t buy the hype. Sure, it’s tangible, and it’s been valued for centuries. But the reality? It’s had long stretches of poor performance. Take this: gold dropped from $850 an ounce in 1980 to just $253 in 1999—and took 27 years to recover.
Worse yet, gold doesn’t pay dividends, has storage fees, and hasn’t been a reliable hedge against inflation. Between 1979 and 1984—when inflation soared—the S&P 500 outperformed gold. Ric’s advice? If you must own gold, make it a tiny part of a broader strategy that includes other natural resources like oil or silver.
What If You Have Limited Income?
Ric knows not everyone has deep pockets. If your income is tight, he recommends focusing on safety and liquidity. Think: bank CDs, high-yield savings accounts, money markets, or short-term Treasury bills. These won’t make you rich, but they protect your cash and give you peace of mind.
Build a rainy-day fund first—aim for 6 months of expenses, but stretch to 2 years if you can. Once you’re stable, then consider longer-term investments to beat inflation, which can double your cost of living over two decades.
What to Do with an Old 401k
Leave your job and not sure what to do with your 401k? Ric lays out four options:
- Leave it where it is
- Roll it into an IRA
- Move it to a new employer’s 401k
- Cash it out (don’t do this—it’s a tax disaster)
He prefers IRA rollovers because they simplify taxes and expand your investment choices. Just make sure the funds go directly to the IRA custodian to avoid triggering tax withholding. If the check comes to you, 20% gets withheld unless you replace it yourself within 60 days.
Don’t Rush Social Security
Steve, a 66-year-old audience member, asked about taking Social Security now versus waiting. Ric’s advice? Wait until 70. Every year you delay past full retirement age adds about 8% to your benefits—and potentially more for your surviving spouse.
There’s no one-size-fits-all strategy here, so don’t rely on blanket rules. Instead, make your Social Security decision based on your income, health, and long-term goals.
Do You Have Umbrella Insurance?
Ric also touched on umbrella liability insurance—something too many people overlook. It doesn’t cover physical damage (like a roof leak), but it does protect your assets in case of lawsuits or liability claims. If you own a home, drive a car, or have sizable savings, this extra layer of protection is worth considering.
Why NASDAQ Still Matters
Robert McCooey, a top exec at NASDAQ, shared insight into how the exchange has transformed from the world’s first electronic marketplace in 1971 into a global force. It now powers 74 exchanges in 50 countries.
While critics worry about the lack of human oversight in electronic trading, McCooey highlighted how tools like circuit breakers help prevent flash crashes. He made a compelling case for investing in stocks—not just individual shares, but through mutual funds and 401ks—as a proven way to grow wealth over time.
Real Estate Is Only Worth What Buyers Will Pay
Thinking of selling your home? Ric says it’s time to get real. Your home is worth what a buyer will pay—not what you paid for it, not what the town assesses it for, and not what you need to break even.
Sellers who overprice based on emotion or outdated comps are likely to sit on the market or be forced to reduce later. Bottom line: if you want to sell, price your home competitively based on what’s moving in your market today.
Final Thought
Whether you’re managing a small income, nearing retirement, or just trying to get smarter about your money, Ric Edelman’s strategies come back to one central theme: balance. Avoid hype, invest steadily, stay diversified, and don’t make emotional decisions—especially when it comes to gold, Social Security, or your home.
It’s not about chasing trends—it’s about making informed, rational moves that support a long, secure, and fulfilling financial future.
All information provided is for educational purposes only and does not constitute investment, legal or tax advice; an offer to buy or sell any security or insurance product; or an endorsement of any third party or such third party’s views. The information contained herein has been obtained from sources we believe to be reliable but is not guaranteed as to its accuracy or completeness. Whenever there are hyperlinks to third-party content, this information is intended to provide additional perspective and should not be construed as an endorsement of any services, products, guidance, individuals or points of view outside Edelman Financial Engines. All examples are hypothetical and for illustrative purposes only. Please contact us for more complete information based on your personal circumstances and to obtain personal individual investment advice.
Neither Edelman Financial Engines nor its affiliates offer tax or legal advice. Interested parties are strongly encouraged to seek advice from qualified tax and/or legal experts regarding the best options for your particular circumstances.
