Stock Market is the bottom in?

[Buckly]

I’ve been retired 7 years. Here’s a few things I’d say are pretty common advice for retirement.
If you’re debt free at retirement you have a big advantage to living the way you want.
Live on what you have at retirement not what you hope to have.
If you’re debt free , then 50% of pre retirement income is pretty safe strategy.
You will probably do better over time than the financial people will tell you.
Learn to handle your own money. Nobody needs it more than you.
Your timeline is shorter than you think. Plus or minus 30 years. If you get by your first 10 years mostly unscathed you should be fine. It goes fast.

 

[Barndog56]

Lol. It depends on what kind of retirement you want, or need.

Due to my wife's MS, and the slow government pace of disability approval, the two of us have lived on $50k a year for the past 3 years. And that's with a mortgage payment. She finally got approved last month.

I'll likely not retire til I'm 70(15 more years), as my job now is too easy to give up until I'm at full social security. I'll be lucky to have enough in my 401k for a new truck at that time. But am not worried at all about our survival.

But we're used to a simple, cheap life.

 

[PatinPA]

Sure seems like the interwebs are full of hate for "evil" boomers hoarding all the wealth. I imagine future generations will indeed be wealthier once the $80+ trillion wealth transfer takes place from Gen X and Millenials inheriting boomers' wealth.

Seems to me Gen X was/is the first generation to deal with a lack of a pension and having to invest independently. Most of what I read indicates the Xers are who are really in trouble in retirement. No pensions, likely reduced S.S. benefits, and late starts in funding 401ks.

Oof that's where I'm at. Gen X, behind on my 401K, no pension. Currently renting but would like to buy a house, but also don't want a mortgage til I'm 77. I hate my job so I'd prefer not to work til I die either. Trying to learn the stock market and buy a lottery ticket once a week. haha That's my retirement plan.

 

[4wanderingeyes]

Lol. It depends on what kind of retirement you want, or need.

Due to my wife's MS, and the slow government pace of disability approval, the two of us have lived on $50k a year for the past 3 years. And that's with a mortgage payment. She finally got approved last month.

I'll likely not retire til I'm 70(15 more years), as my job now is too easy to give up until I'm at full social security. I'll be lucky to have enough in my 401k for a new truck at that time. But am not worried at all about our survival.

But we're used to a simple, cheap life.

This is us in a nutshell.

 

[homerj]

Oof that's where I'm at. Gen X, behind on my 401K, no pension. Currently renting but would like to buy a house, but also don't want a mortgage til I'm 77. I hate my job so I'd prefer not to work til I die either. Trying to learn the stock market and buy a lottery ticket once a week. haha That's my retirement plan.

I think I'd stick with dollar cost averaging the max into an index fund, but that sure isn't sexy or a path to getting rich quick.

 

[Foggy47]

As a FWIW.....we live off our mix of stocks and bonds. And my wife and I both get our SS benefit each month....and I get a small pension from the Aluminum company I worked for....but its only $275 / month.

For 23 years now....we have drawn 4% divided by 12 = the draw down each month for our "allowance".....as we like to call it. Our planner says he would have no problem with upping that to 5 or 6% if we want.....but we dont want / need any more income. We do gift a considerable amount to our kids each year and have drawn some more out when we built new homes. We have also been able to gift some considerable dollars to our grandchildren in the past two years.....so when the time is right they can buy better homes than they might otherwise. We feel fortunate that these plans have worked out.

Somehow, we have a higher net worth than the day we retired from the working world. We have had some solid earning stocks and bonds....and have kept a good mix of both via an allocation plan through our planner. I seldom advise to buy one stock or another....they do the picking and make the choices......but I did have my planner sell my Disney shares a few years ago when they went Woke. I wont knowingly participate in that chit.

We are pushing around a big capitol gains tax bubble.....and that prevents our selling some stocks for others. <----that is one thing I am not real happy about.....but it has not "cost" us anything at this point. The only way to avoid the capitol gains tax is to get the stepped up basis when one of us passes on.....and we are not wanting to do that for some time.

Same goes for our home.....we would like to downsize....but the capital gains tax bill prevents us from doing sp. While these may be good problems to have....they do make for more work as we get older.....and who wants that?

One good thing about holding mutual funds rather than individual stocks.....is that they pay the gain on the fund each year....and you do not push a big caption gain around. OTOH...that is also a bad thing....in that those same dollars are earning money for me each year......and you can avoid any cap gains taxes by simply dying.....and passing on the stepped up basis to your heirs. What fun....right? grin

TANSTAAFL : There ain't no such thing as a free lunch.

 

[SD51555]

I cranked up my 401k contribution when the market slide started. I also learned I need to leave some in a 401k if I want out at 55 or sooner. I’ve converted all my old 401k’s to Roth as I’ve moved around.

I switched jobs over a year ago and converted that one right away. I had forgotten I did it and was wrestling with a tax bill on 4/14. It finally dawned on me that I did owe it and begrudgingly wrote the check a day before the deadline.

Can’t agree more on learning to manage your own. What planners and advisors do is not rocket biology. They can be copied very easily, and as your assets grow, their skim can amount to thousands of dollars per year. I refuse to pay it because there is no value to me. And I enjoy the game. It’s worth figuring out, and you can Taylor it to still be very easy to manage and understand.


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[Foggy47]

I cranked up my 401k contribution when the market slide started. I also learned I need to leave some in a 401k if I want out at 55 or sooner. I’ve converted all my old 401k’s to Roth as I’ve moved around.

I switched jobs over a year ago and converted that one right away. I had forgotten I did it and was wrestling with a tax bill on 4/14. It finally dawned on me that I did owe it and begrudgingly wrote the check a day before the deadline.

Can’t agree more on learning to manage your own. What planners and advisors do is not rocket biology. They can be copied very easily, and as your assets grow, their skim can amount to thousands of dollars per year. I refuse to pay it because there is no value to me. And I enjoy the game. It’s worth figuring out, and you can Taylor it to still be very easy to manage and understand.


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I do agree with most of what you say. I did most of my own investments for many years....and did so without the drag of an advisor. When I retired I still did my own for several years. Then came a time when that was a PITA to watch the markets on a daily basis to stay up on what was happening to my portfolio. Also we traveled a bit overseas and such....and who was watching this stuff? Also we needed to set up a trust and several other legal issues which the planner company was well aware of....and guided us through those issues...and made sure all the tees were crossed and the I's were dotted and much more. The cost is less to us than the fund companies charge for management. (less than .5 % for us) Still it is a factor.

For me there came a time when I spent too much time and energy to do this stuff.....and I was concerned that at some age I would not be able to do this chit. The cost was not that severe considering the value of the planner company. Now as we get older, it's nice to have a trusted "outfit" that can help as we will become too old to do these things and can also aid after the demise of one or the other of us. Not to mention our kids, etc.

When your in the assisted living or nursing home....it is not time to consider such things. My 2 cents.

 

[Westwind]

I think I'd stick with dollar cost averaging the max into an index fund, but that sure isn't sexy or a path to getting rich quick.

Best advice you will ever get right here.

 

[buckvelvet]

I cranked up my 401k contribution when the market slide started. I also learned I need to leave some in a 401k if I want out at 55 or sooner. I’ve converted all my old 401k’s to Roth as I’ve moved around.

I switched jobs over a year ago and converted that one right away. I had forgotten I did it and was wrestling with a tax bill on 4/14. It finally dawned on me that I did owe it and begrudgingly wrote the check a day before the deadline.

Can’t agree more on learning to manage your own. What planners and advisors do is not rocket biology. They can be copied very easily, and as your assets grow, their skim can amount to thousands of dollars per year. I refuse to pay it because there is no value to me. And I enjoy the game. It’s worth figuring out, and you can Taylor it to still be very easy to manage and understand.


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SD, it sounds like in the 3 last year you've taken the reigns of your investments. Are you able to compare the % advisors grew it compared to what you've done?

 

[buckvelvet]

I gotta say this is my favorite threads on the internet to read. Everyone has such vast life experience. We have loaded folks and happy meal loaded and all in between. Life's a wild ride, sure helps to trust God in the process.

 

[bwoods11]

I was never a big Google fan (politics aside) I bought some shares at close to the low …

They just reported excellent earnings. Forecast was $2.01 per share … actual earnings $2.81 per share!

 

[hunts_with_stick]

SD, it sounds like in the 3 last year you've taken the reigns of your investments. Are you able to compare the % advisors grew it compared to what you've done?

I had an advisor for too many years, then I looked at how much it grew and said I am better off just investing on my own. So far it is true. Even with this slight downturn.

 

[hunts_with_stick]

couple of days ago i bought some COIN. I am glad I did.

 

[SD51555]

SD, it sounds like in the 3 last year you've taken the reigns of your investments. Are you able to compare the % advisors grew it compared to what you've done?

I've been doing it for a very long time, north of ten years. Up until this market slide, I was behind the averages. I never latched onto the tech boom and it flew by me. I didn't take near the haircut that the markets did in the great tariff slide. I had lots of stuff in cash and cash equivalents, and energy. I'm in pretty good shape coming out of this. There are environments when my stuff will excel vs the markets. The recent past wasn't one of them.

In a flat market, I'd smoke the averages with option income alone. Share appreciation is just icing on the cake. One of the stocks I picked up in the chaos was GOOGL at $149. They should open around $166 in the morning on a positive earnings report. Still waiting on a few others to be right, but they'll come.

 

[SD51555]

I've been getting real impatient waiting for earnings season to go by because I didn't want to have calls out there while prices are down. GOOGL is a good example of why. I knew $149 was a steal when I bought it. 15 years ago, we'd call that properly valued. So very few stocks are such nowadays. Still, I'm a junky for throwing dice in the options pit, so I sold a way-out-there option on GOOGL to keep the option $$ flowing. I got lucky and GOOGL didn't blow earnings away too much, and at least with today's knowledge, I should be ok on GOOGL. I don't want to lose it, but I'd love to re-write my GOOGL call in a week or two for $180 or higher.

This is a normal occurrence once every week or two with these options. I always want to see wads of cash coming in. Don't much care if the share price goes up, it just needs to not go down. Then I take the cash and throw it in something higher yield (like EPD) and wait for another buying opportunity. I keep bumping these out a week each week. I usually take half or better of this cash to the bottom line each week. Some is given back to buy them back and rewrite them out a week further. This is in my HSA, and shows how the money flows. GOOGL pays $80 a year in dividends on 100 shares. I should get paid that every two weeks If I manage to not lose it.

Then, if things are going really well, I'll sell options on the cash from selling options in my EPD. Right now I'm holding off on selling options on my EPD. For a high yield stock, it sure likes to move around, and I'd hate to miss a 10% run up while the market finds itself.

 

[SD51555]

VLO reported today, pretty much a snoozer. Still, VLO is down more than I'd like, and I don't want to lose it below where I bought it. So I'm going cautious with it right now. Soon as the market digested the earnings report, I went in and got my calls sold to keep the money flowing. VLO has a tendancy to just go up 15% over a 10 day period for no reason, so I'm being cautious and selling calls further away. If I was up 5-10% on these shares, I'd be selling calls much closer to the share price and getting net paid north 1% every 2 weeks.

I also picked up some FDX in the carnage. They are a good option worker too. Here's an example of how these trades end. I sell the calls one week, and then around 5-10 trading days later, I'll buy them back, hopefully (like this one) at a much lower price, and re-write the call for another week or two out and keep the cash moving.

 

[SD51555]

I forgot to do UNP today. I had a lot going on at work. But, if the price holds like this tomorrow, I'll sell a May 9th $225 call and get paid 0.58% for the two week call. If I can hold that gap for a year, that 0.58% turns into 15.1% cash yield on the options plus 2.44% in dividends = 17.54% cash yield on an otherwise identical buy and hold strategy.