Most People Won’t Have Enough to R...
3 Responses to “Most People Won’t Have Enough to Retire”
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Will You Outlast Your Money?...
One Response to “Will You Outlast Your Money?”
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Steve Schmidt says:
Good but worrisome situation as you described in the the above. I’m working on a good retirement by saving and investing. Been doing covered call options for years now, but your course on Credit Spreads has opened up new roads to an even better retirement. Just wanted to say thanks.
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Profitable and Bankrupt at the Same Time...
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The 800 LB Gorilla...
4 Responses to “The 800 LB Gorilla”
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Hey Jeff,
I don’t know much about trading, but this was one heck of a post. There are far too many “so called investment advisors” who are doing this kind of thing.
This sure does make you think.
More importantly, it reminds us of the importance of due diligence.
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Jeff B says:
Good thoughts Jeff! Drawdown recovery is the MAIN issue for anyone trying to rebuild an investment portfolio.
Jeff B.
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Hi Jeffery,
I like this piece because I often think I am unable teachable by others do to my rogue nature. I have traded the stock market and the forex market. So considering how big my opponent is for part of 2009 and 2010 I have had to stick to my style of trading. Which I call chip and go. I don’t hold on to anything in life except family. So far I have seen a little profit consistently. But I am comfortable. I watched my friends tank boat loads of money during the recent crash. But my style of trading saved me and my son thousands of dollars. Why? We considered our opponent the cooker of books on wall street and some of the unscruplous forex brokers.
This piece makes me feel good for attending webinars and reading since I don’t watch t.v. in regards to the market as a whole. Because nothing is as it should be.
thanks for hearing me out
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Adam Moon says:
This topic makes for great debate. This ties into Jeff’s first posting about “Change or Transformation.” While making permanent change can be difficult I would disagree that it has to take time.It just takes enough reasons.Let me explain; Say 2 people are trying to give up smoking, we’ll call them smoker A and smoker B. Why is it that smoker A can put the cigerette down and never look back while smoker B puts the cigerette down but constantly struggles between the addiction, in and out of rehab, and tries all of the gimmicks available? Well, the answer is smoker A changed his/her “identity” while smoker B only changed his/her “behavior.” This is what Jeff was talking about when he refered to people going to the gym early in the year but giving up shortly after. To make an identity change, a permanent change, one has to relate more pain(reasons) into not changing than to the pain of staying the same. If you look in the mirror and say to yourself,”I only have an extra 10 pounds of “love” to lose, then that 10 pounds will always be there. Now if you look in the mirror with your shirt off and grab the 10 pounds around your waist and mash it together so you can really take a good look at it and say,” look at this!, this is disgusting!, repulsive!, and not sexy!”, then you are creating in your mind more reasons (pain) into not changing, then to your present state. Our minds are programmed to seek pleasure and avoid pain in everything we do. So it’s what we link to pleasure and pain that makes the difference. If one is trading options with only a behavior change and not an identity change, that trader will forever struggle and will eventually disappear. (sorry for the length of this posting Jeff)
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I’m seeing this story come to life in my extended family. *sigh* They are reducing their contributions for the future, but actually taking from what retirement $ they have to buy things like, house, car, etc.
As for us, we plan on traveling (living off our IRAs) and allowing the kids to have a college education debt free (through 529 Plan). Our thoughts are there will be no Social Security since all the Boomers are taking it…so we better have a Plan B (B meaning Better).
Jeff,
This is just so very sad. Like the previous comment from Jennifer, I think this is going to be a new normal where many people will never realize their dreams of retirement.
After getting into some problems with using “plastic” over a decade ago and digging out of that situation, our plans included a firm reslove to eliminate all our consumer debts and live within our means. That required sacrifice and we had to struggle with the temptation of wanting it all right now. As a result though we have been able to save quite a lot for the kids college via 529′s, put money into 401k’s and IRA’s and almost payoff a mortgage. But to do that we had to learn to operate on pretty much a cash basis and accept the concept of delayed gratification.
I’m 47 and I believe that even for persons in my age group that Social Security is not going to be there for us at least not in the way we expected it to be. I’m horrified to think though that for more than half the population this is all they have for retirement. It’s truly a sad situation.
My Plan B? Well I look at retirement savings like a multi legged stool…more legs the more stable the platform. So in addition to learning how to trade Credit Spreads for extra income (thanks Jeff!), a few years ago I also decided to limit my participation in my companies 401k only up to extent where I can receive matching funds (its free money after all). Beyond that, faced with the prospect of pitiful returns and a long term decline in the market, I came to realize that nobody is going to care about my money more than I do. So the rest of my retirement savings contributions I put into a self directed IRA.
A few years ago someone turned me on to the idea of buying shares of high yield dividend stocks but only from a very select group.(Clorox and Statoil are two current examples). The twist is that up until a few years ago I had no idea about how to use options as risk management tools. In order to understand this though, I had to go out and get some education about how to use options to hedge the portfolio risk. At certain times now when I percieve greater risks I use Collars, ie I sell Covered Calls and buy Protective Puts in order to lock in gains and hedge the downside risk & continue to collect the dividends. I consider this a long term program (like a kind of insurance for Social Security not being there for me) so I am not worried so much about the day to day fluctuations in the portfolio. So far this has worked pretty well during the recent volatile markets.
One other thing we are looking at seriously too is retirement overseas. I’ve been researching this and there are a surprising amount of low cost places where you can live very well and really stretch your retirement dollars.
Jeff,
I am 61 and planning to kick in SSI next year. What? Take the early penalty? Yes, because there is a marriage penalty. When my wife pushes the button in 2012, SSI will place a combined limit of $2,400/month on us, no matter when we push the button. This is a little known fact that people planning to to do this should look into.
Right now I use 10% of my IRA for active trading. Of that 30% is in conservative (Covered Calls) and 70% is in spread trading (Credit Spreads, Calendars, etc. – depending on the market).
Your course got me seriously started on the Credit Spreads and lead to other spread combinations. Thanks for that.
My daughter was going to put money into one of those college funds and asked my opinion. I looked them over and recommended that she just open a regular saving account and buy good high dividend yielding stock and sell a few Calls now and then. The problem I have with the 529′s are all the restrictions and the poor choice of investment funds (I would never recommend a mutual fund). That’s just me. Pay the dividend gains now when you can afford it and then have the money for college and go wherever you want when you want.
Thanks – Jeff