People, so called experts (you know my feelings on experts), are saying stupid things like sell everything, or sell into any rally. Don’t listen.
On the contrary, buy and keep buying. Don’t take every last penny and invest, that’s just as stupid, but if you buy regularly as the market falls, you’ll have a lot more shares when things turn around. It’s a proven concept called dollar cost averaging. These “experts” make it sound like dollar cost averaging is only a good idea when markets rise but it’s just the opposite. It works best the further the market falls.
The spring is tightening, coiling up for those of us smart and confident enough to stick with a plan, and bold enough to adjust the plan to take advantage of panic.
The lottery is real it’s just not a sudden and unexpected thing. It’s predictable (over long periods of time) and involves some faith but mostly discipline. The slow motion lottery of investing and working hard isn’t found in a convenience store, it’s found in your character.
So what should you do?
Make a plan. Investing blindly is no different than paying money for random numbers you hope will match some other random numbers.
It’s a new year and if you didn’t max out your 401k last year, this is the year to do it. I have calculated the amount I need to invest each paycheck so that I’ll hit the max on my last paycheck. Here’s how you can do the same: Take 18,000 (2016 max) and divide by your salary. This is the percentage you should invest. Take that percentage and multiply by your gross paycheck. For example: if your income is $80,000/year then the percentage you need to save is: 22.5%. Your weekly gross is $1,540 and you should put $347 each paycheck into your 401k.
That alone is good but it’s not lottery worthy. Save more now than you ever have and invest in accounts other than your 401k.
Discipline is hard. Saving when you really want to spend is hard but it’s a winning lottery ticket you just have to have the guts to buy it.
PS: if you read this far I’m impressed but I know you’re probably thinking there is no way you could save and invest that much. You’re wrong. Check out how much I save and stop making excuses.
Posted in General, Money, Success and tagged invest, investing, jackpot, lottery, market, powerball, stocks by AJ with no comments yet.
I’ve said it before, that if you use the gauge of who is richer, who garners more respect, and who can get on TV any time she wants then Ms. Whitney is far more qualified than I am to offer her financial advice. The difference is that I’ve been correct in my predictions and she’s been wrong though she’ll never admit it (especially to me).
Stocks have gone up very quickly and there are various reasons for that but Ms. Whitney has been cautious about stocks – until now. CNBC states “Known more for her pessimistic take on the markets, and banks in particular, Whitney has turned in the opposite direction.” Run the other way!
Whitney says she’s “not been this…bullish…on equities in my career.” Yeah I know, but I have, and I’ve been right and she’s been wrong. I’m a lot more cautious, now, just as she seems to be jumping in with both feet.
This reminds me of another person I’ve called out for being a fool who jumps on whatever bandwagon is rolling through town, James Glassman, who wrote the book DOW 36,000 just as stocks were about to crash from their internet binge. Glassman later wrote, Safety Net, a book about how stocks were not a good investment and which favored bonds just before this amazing stock market run we’ve experienced these past few years.
My feeling on investing has evolved over the years and at one time I thought I could time the market, predict with reasonable certainty what individual stocks would do. I was wrong. Since then I have become a passive investor (passive is such a misnomer).
It’s been said that you can pick your friends, you can pick your nose, but you can’t pick your family; I’d change that to you can’t pick the direction of the market. And yet people try. They tried with internet stocks, they tried with housing, and they’re trying again with bonds.
You choose whether you want to listen to these so called experts but my advice is to ignore these fools and invest with a long term view. Tomorrow I’ll have a post about how my saving and investing has enabled me to be aggressive when I wanted and cautious when I needed.
Posted in General, Money, Success and tagged bonds, dow, investing, James Glassman, market, Meredith Whitney, stocks by AJ with no comments yet.
Despair.com takes the concept of the motivational poster and turns it on its head calling their posters “demotivators.” This one is how I often feel when trying to promote my book. The caption says “If you find yourself struggling with loneliness, you’re not alone. And yet you are alone. So very alone.” (Click on the picture to see it bigger).
Asking What Next is a very personal thing but eventually you’ll have to let others in on the secret. There’s no guarantee that those people you include in your plans will be as enthusiastic about it as you are, or that they will even like the plan. Who you include in your plans is crucially important but so is who you don’t. This is true in life as well. I do my best to avoid the petty drama that too many people are caught up in (and that has a cost as well). The bottom line is that you can only rely on yourself. Any help you get along the way is a bonus. The truly successful create evangelists, true believers who will spread the word for them. But don’t expect everyone be an evangelist or to even care.
You’ll also find that the people you meet, the people you look to enlist as support, as you try to sell your book, your business, your idea, are also trying to sell you their idea, their business, their book.
You are alone as you try to make something from nothing but don’t worry you’re in good company. We’re all in this separately.
Posted in General, Success and tagged business, friends, market, Sell by AJ with no comments yet.