The golden egg: don't let your nest egg crack.

• Author: Haraldsen, Tom
• Position: Wealth Management

Just before Christmas this past December, the FOX Network offered up a new prime time game show called "Million Dollar Money Drop." The premise was somewhat unique in that each contestant couple was "given" $1 million in cash to start the game with, and by correctly answering a series of seven questions, they could retain any money they hadn't lost by guessing wrong answers.

During the four-night event, almost every set of contestants lost all or mostly all of their cash, money that literally dropped down a chute through a trap door when those contestants wagered their money on the wrong answer.

The show was a game of course, but the lesson of this "reality" television program has, sadly, become a true reality for thousands of investors who've failed to properly manage their money. Many have seen their nest eggs fall down the trap door of a sagging economy when their decisions on investing and embellishing their retirement have gone wrong. Earning their fortune was one thing--retaining it was quite another.

Focus on the Future

Wealth management depends on long-term planning, not a one-time network event. That means more than just choosing investment strategies. In fact, it may mean one big behavioral change right up front--keeping that 52-inch plasma screen in the living room turned oil.

"The near-term focus is particularly noticeable in the financial press, with topics like 'Was the market up or down?' or 'What stock was off 10 percent today?' dominating the conversations," says Douglas Wells, vice president of the Albion Financial Group in Salt Lake City.

"Unfortunately, the answers to those types of questions do not make much difference to successfully preparing for 30 or more years of retirement," he says. "What does make a difference for the average person is seldom covered in the daily press or on television. Perhaps this is due to the fact that much of the truly important advice is frequently counterintuitive and can often seem out of touch with the day's headlines."

Professionals who deal with wealth management agree on one thing--that anyone planning for retirement needs to know it's a process that involves patience and the ability to endure some heartache and roadblocks along the way.

"The vast majority [of investors] really focus on the short term," says John Bird, president and a co-founder of Albion. "Emotions often play havoc with investor returns because there's a natural tendency to have an emotional reaction to news or events."

That reaction often leads to investors making changes in their plans or a particular stock, sometimes at the drop of a hat and often with disappointing results.

A study in 2009 by DALBAR, a Boston-based think tank that is a financial services market research firm, found that while the S&P 500 returned 8.35 percent over a 20-year period, the average equity investor (someone making their own decisions and regularly changing them) earned just 1.87 percent on their money, less than the inflation rate of 2.89 percent for the same time period. DALBAR's annual Quantitative Analysis of Investor Behavior has regularly shown a large gap between the returns investors actually earn and the returns they could have earned with a "buy-and-hold" strategy.

"Investors often look...