Are You Invested Too Aggressively?

If you’re selling shares every month to pay the bills, does a stock market drop hurt you or help you? It hurts, of course. If the market is down by 50%, you now have to sell twice as many shares as before and you’re cannibalizing your portfolio even faster. Dollar cost averaging is a one way street. When the market is down 50% and you’re buying stock, that works in your favor; but when you’re selling shares, that hurts you. It’s called reverse dollar cost averaging.

If you have 20 or 30 years ahead of you until retirement, you should be invested aggressively. You have enough time to make up the losses, should they happen. But if you’re already in retirement or at its edge, your portfolio should be comprised of mostly conservative investments with a goal to produce a monthly income regardless of market performance.

How to Create an Income You Can’t Outlive

Having the right mindset when it comes to saving for retirement is critical. For decades, you may have been focused on investment growth with little regard for the possibility of losses. As you hedge closer to retirement, that can be a deadly strategy that you just can’t get away with anymore.

The absolute key to security in retirement is income. A steady, month after month, market-proof income that you can’t outlive. How do you create that? Listen in.

Investing for Income

As a retirement income specialist, I talk often about why investing for income is a winning strategy when it comes to planning for retirement. What exactly is investing for income, and why is it superior to investing for growth – especially when the stock market is in a downward trend and accounts are losing value?

When you’re invested for growth, it’s all about the share price; if your balance goes up, then you win; if it goes down, then you lose; the whole point is that, a few decades down the road, your balance is hopefully larger than you started with.

When you’re invested for income, it’s not about the account balance, but rather, about the interest and dividends that you receive from your portfolio. If you’re properly invested, you can COUNT on your income – even during times of inflation, high interest rates and unemployment rates, pandemics or war overseas.

Want to learn more? Listen in.

Should I Sell My Stocks?

For the last year, the number one concern on people’s minds has been inflation. It’s important that an economy has some inflation, but you don’t want it to be too high. However, you don’t want it to be too low either. Somewhere around 2%-3% is good. But inflation has crept up to the mid 6% which is way too high.

In this economic environment, I often get asked these 2 questions:

– should I sell my stocks?

– should I buy a CD?

Listen in for my thoughts.

What’s a Good CD Alternative?

Since short-term CD rates are pretty attractive right now, some of you have called to ask if it’s a good idea to buy a CD. In this show, we’ll talk about why you may not want to give in to that temptation.

So, if short-term CDs are not a good idea, what’s a good alternative? To answer this, we need to talk about interest rates and where they’re headed. Listen in.

Investment Math – TR = I + G

Got your thinking caps ready? Time for some investment math:

Total Return = Income + Growth

When you invest for growth, it’s all about capital appreciation and your entire goal is to buy low and sell high. You could make a lot of money, but you could also lose a lot of money.

When you invest for income, the value of your portfolio doesn’t matter. You’re investing for the interest and dividends that the portfolio will give you. You know that, year in and year out, you can count on the income from your portfolio, regardless of what the market does.

Are you investing for the I or for the G? Which is better? Listen in.