COMMON SENSE

Arcording to  Trent of the “Simple Dollar”

Three Questions to ask yourself if you are in your 20’s and want to save for Retirement.

1. If money were no object, what would you do with your time?
2. Are you frugal?
3. Are you interested in having children?

The Simple answer is….

Just worry about the saving for now – don’t sweat the details.

Many people get overly wrought about making sure that their money is in the “perfect” investment. To put it simply, your investment choice is secondary – by a long shot – to simply saving your money as soon as possible and as much as possible. Start saving now. If you don’t know what to invest in, just ask for suggestions from the representative there. Since it’s a tax-deferred retirement account, you can make investment changes later on without any tax issues.

Doctrader says: The most import aspects of long term planing is learning there are market cycles. If you can identify the market cycles, you will be miles ahead in your investment choices!  During bull markets, you should have your money invested in high growth areas of the market through an index fund.  When the bull market begins to wane, you should move your long term investments to a money market position or a  cash position.    If you chose a “stable fund” alternative to cash, you run the risk of losing money due to inflation or hidden land mines within a “stable fund”.

Stable funds usually are guaranteed by an insurance companies.  Insurance companies are subjected to the 7 deadly sins of investing.

These are:

• regulation
• investigation
• litigation
• arbitration
• capitalization
• Taxation
• politicization

These 7 deadly sins of investing will impact your future retirement.   If you are serious about your future, your best option is to “create a product or service” which can launch your career into a small business.  After all, our founding fathers were small businesses.  In  fact, most of new jobs created today and in the future will belong to small businesses.

My suggestion, turn your passion into a profitable small business!

doctrader

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The market media matrix continues to spout their view that everyone should be invested all the time.  The continuation of the “perma bull” lies, is only more evidence that “Joe six pack” doesn’t have a chance in understanding cyclical and secular market behavior.  It should come as no surprise that a company, Vanguard, who manages “other people  money”  through their vast array of failed mutual fund managers, to say “happy days are here again.”  Vanguard’s only concern is “IF you to take your money out of the market”!  Vanguard gets paid to manage your money, why are you not holding them accountable for losing 55% or more of your hard earned 401k assets?  As the article states,  younger workers are still in a state of denial, regarding the severity of this market!  The young workers believe that all is taken care of, simply by the government to declaring “Olly olly oxen free” to all the credit problems that are still present!

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DES MOINES, Iowa – Another major provider of 401(k) accounts says the typical retirement saver now has more money in their account than they did before the stock market began tumbling two years ago. The Vanguard Group Inc. said …

Younger workers with smaller balances caught up the quickest. Nine in 10 participants under age 25 were flat or were ahead of their balance two years ago. About eight in 10 workers in their mid-20s to mid-30s had recovered to 2007 levels.  However, just half of the participants in their 50s and 60s have recovered or gained slightly while half have not.  This was based on Vanguard’s selectively picking  participant balances between September 2007 and September 2009.   I want to know the total return of all their assets from 2000 to present! Given most 401k plans are for long term results, not just a short two year stint.  The overall stock market is up just under 60%, while the markets are still down from their previous highs of 2007 by 25%!   Since “Joe Six Pack” is not versed in the the way Wall Street uses numbers to lie, what will happen to the 60% gain “on paper” to his 401k plan when the market returns to new lows?

Financial News – http://finance.blogrange.com/

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The unemployment rate continues to rise and many people are considering tapping into their retirement savings, or taking a loan against their 401(k) plan. Author Lynette Khalfani-Cox offers some guidance.

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If you’re throwing a few bucks in the company 401k, that’s a great way to save, but we’ll tell you how to earn even more for your retirement.

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