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Tuesday, April 21, 2020

Everybody's Working For ... ?

The song goes, "everybody's working for the weekend," and while that is certainly true for most people, many my age (and younger) have begun to focus on something a little more goal-oriented. No, I'm not talking about creating a secondary income or working from home today. I'm talking about retirement. Building that ever-elusive nest egg so that when the time comes to retire we don't have to take a job as a door greeter at a big box chain store.

(NOTE: This blog post was originally posted in April of 2020. It has been updated for September 2022.)

What about you? Have you thought about retirement income yet? I will say this. Youth definitely has an advantage here over us older folks because time is on their side. With careful planning, consistency, and decades of time ahead of them, 20-somethings can manage to end up with a sizeable amount of money to retire on by the time they hit retirement age (at today's goal of 65 or 70!). Start early enough, and you might be able to retire early as well - depending on your financial goals and retirement income.

For me, I've gotten off to a late start. I started a nice Roth IRA a few years ago with the help of my personal financial advisor. Unfortunately, I haven't been able to keep my hands off of it. Lately, the markets have taken a real beating, too. I also decided to diversify my investments into the cryptocurrency markets back in 2017, but again, hard to keep my hands off the kitty. That's another piece of sage advice to the youngins... keep your hands off the kitty. Create a rainy day fund somewhere else and make the commitment to never touch your retirement investment funds!

Let me just pause here to give a quick disclaimer. First, I'm not a financial advisor. Nothing in the blog post, or even this website, should be construed as financial advice. I'm simply sharing what I've done and what I'm doing. I've made lots of mistakes along the way. It is simply my hope that by sharing these things with you that you might be able to avoid some of the same pitfalls I've made over the years.

Now, back to our regularly non-scheduled blog post.

I've been able to see the big picture and still hope to be able to retire at 62, when early Social Security kicks in for my age bracket. That gives me 11 more years to invest and build my nest egg. Savings accounts are for the birds. We do have a rainy-day fund there that we add our one royalty check to each month or so. But the interest yield is so pitiful that it doesn't make for a good investment of any kind, in my humble opinion.

The Roth IRA has performed well over the years, around 18% cumulative over four years. Could it be better? Sure, if the economy hadn't tanked thanks to the coronavirus. But remember, we're still playing the long game here, even if "long" is only 11 years to my goal. My split is 80% stocks and 20% bonds, so that explains a lot. You may be able to split your risk differently (and probably should) based on your age and goals. Talk to your financial advisor for sure.

My other retirement investment has been a foray into the world of Bitcoin and other cryptocurrencies. In the past several years I've not only invested but also learned how to trade cryptocurrencies as well. Both have proven to be very lucrative. In the last three years of my cryptocurrency trading and investing, I've managed over time to more than double my investment. Now if I could only keep my fingers out of the cookie jar! The downside to crypto is that it is still young and not widely accepted yet (although that is changing daily), so there is a lot more volatility than even the stock market. Gains can be great but so can the downside. I would advise talking to a financial advisor that knows about and has some recommendations about crypto (other than "don't do it") before you do any investing in this area.

Always remember the golden rule in investing ... Never invest more than you can afford to lose.

With that, I'll close with a link that I've set up to help out anyone who is interested in buying Bitcoin:

Hope this helps anyone who is no longer working for the weekend, but is working for the future and retirement!

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