Naked Truth Investing: A two-letter word that could double or triple your retirement savings

This is the part of a new series of columns called "The Naked Truth," by retirement expert Dan Solin. Please bring him your questions, in the comments box, and he will answer as many as he can.

I have a two-letter word for you that could double or triple your retirement savings. It is the answer to each of the following questions:

1. Open an account with us and we will put together a portfolio of stocks and bonds for you.
2. We recommend this mutual fund. It is highly rated by Morningstar.

3. We recommend this stock. Take a look at its "target price."

4. Just sign this account opening statement. Don't worry about the mandatory arbitration clause.

5. Our technical program can tell you when to buy (the "green light signal") and when to sell (the "red light signal").

6. We recommend that you get out of this mutual fund and into this one. Its manager has a stellar record of performance.

7. We recommend that you purchase this variable annuity.

8. We recommend that you purchase this "no risk" equity indexed annuity.

9. We recommend that you purchase this hedge fund.

10. We recommend that you take advantage of this "buying opportunity" in the markets.

The two letter word is "No."

Every day, thousands of investors make the mistake of saying "yes" to one or more of these pitches.

This advice has little peer reviewed academic data to support it. It benefits the "investment professional."

It often is bad for the investor.

There is a way to invest responsibly. Determine your asset allocation. Invest in a globally diversified portfolio of low cost index funds.

Just say "no."

Dan Solin is the author of The Smartest Investment Book You'll Ever Read (Perigee Books 2006) and The Smartest 401(k) Book You'll Ever Read (Perigee Books, June 24, 2008). Visit his website at
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