THE NEW RULES OF RETIREMENT SAVING • vii
be complex and fraught with a multitude of problems and uncer- tainty, but logic is simple and numbers are starkly pure. There is a rare, sweet harmony to math not found in the other sciences. The English words “actuary” and “actual” stem from the same Latin root, which connotes “a state of fact” or “that which is real.” When analyzed correctly, numbers can tell us much about life, es- pecially its financial side. Take Johnny and his apple stand, for in- stance. As a merchandiser of fruit, he is no superstar. This had better be a sideline for the kid because, at five apples a day, if he has any overhead at all, he is a bankruptcy candidate (of course that may depend on how much he gets per apple). Any financial undertaking held up to the light of analysis by applied actuarial science will have a much better chance of succeeding than one without such benefit. Your Own Personal Actuary I believe people should have their own actuary the way they have their own doctor, lawyer or accountant. Actuaries specialize in identifying and reducing risk. And financial risk is what keeps many of us up at night. Will the stock market rise or fall? Will in- terest rates go up or down? Have I saved money in the right vehi- cles, with the right tax status, at the right time? It's enough to give anyone insomnia. Just about everyone's financial portfolio could use help mitigating risk. One of the reasons I founded Stonewood Financial was so I could take the unique science of risk assessment and actuarial problem solving out of the boardroom and bring it into the living room, so to speak. All of us deal with risk in our financial lives — risk that can be mitigated, or at least prepared for, through actu- arial analysis. So let this book be your own personal actuary. I promise it will be more interesting, insightful, and enlightening than our stereo- type would lead you to believe.
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