Online Trading
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Alternative Retirement Income Options in 2005
   
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You Dont HAVE To Be Trading
As a novice trader, youll often feel the need to trade.
You may be bored or frustrated. Or you just want to try a certain type of trade .....
As a novice trader, youll often feel the need to trade.
You may be bored or frustrated. Or you just want to try a certain type of trade .....
A very wise and good friend of mine told me once: "One good
investment is worth a 'lifetime' of labor." After reading this
article, the wisdom behind this statement will be clear to you.
The big question we should all be asking ourselves is "how much
do we need to save to be able to support ourselves?". We cant
estimate that unless we first make some basic assumptions:
A zero-inflation is unrealistic. It's safe to assume however
about 2% inflation. If it is higher than that, it is bad for the
economy of the country., The Bank of Canada is is mandated to
keep inflation under control, using interest rates. If the
average rate of inflation for the next 50 years is 2%, then a
dollar 50 years from now will be worth roughly (1 - 0.02)^50 =
36 cents. So if save one million dollars today, these retirement
dollars will be worth about $360,000. That's still enough to
give you an annual income of $36,000 -- well above the poverty
level.
Compound interest is powerful magic. In 50 years, money doubles
roughly 7 times, which means that a single $1000.00 investment
will grow to roughly $128000.00. Other than the work you did in
the first year to save the money, you haven't had to do anything
for the next 50 years.
That's roughly one-tenth of the million dollars most people
would like to have sqirreled away for retirement. If you also
want to have a million dollars, you'll need to invest about ten
times this amount: say, $1000 a year for the next 10 years. Or
roughly save $100 a month. Not too difficult is it?
If you can save more, sooner and earn more longer; this is
better. Hence the name of my website
http://www.BetterRetirementSooner.com.
Lets not forget about the federal and state taxes we have to pay
every year. We dont have many tax breaks anymore, but the RRSP /
401(k) is there for us to use. Your RRSP / 401(k) is your friend
because the money that you put into an RRSP / 401(k) is not
taxed until you draw from the plan.
If you can make a 10% return on your money inside your RRSP, you
get to keep the entire 10% and the compounded untaxed growth
dollars until you retire and start making withdrawals. If this
same 10% was earned outside your RRSP/401(k), and your yearly
marginal tax rate is roughly 45%, you only get to keep about 5.5
percent of that. So you can reinvest less,and therefore your
money over the years will grows slower.
These days...How do you make a double-digit return on your
money? GICs are a low risk investment. And respectively, GICS
only pay upto 5%. At 5%, it will take 14 years for your money to
double. A $10000.000 GIC will grow to about $115,000 over 50
years. If you managed to save $300 each month instead of $100,
you could get up to $300,000 or $400,000, but you should also
think about taking on a little more risk than just GICs. What do
you do if you cant wait 50 years for your retirement nest-egg?
According to Statistics Canada the stock market has maintained
an average return of 9% annually. If you're not a seasoned
investor, you may not be comfortable with the idea of putting
your money into the stock market. Trust me, if you do not know
what you are doing, leave the stockmarket to the professionals
because you can lose your shirt.
Don't try to time the markets yourself. There are to many
variables and you don't have the information required fast
enough to make the timely decisions necessary to be profitable.
An inexperienced Day Trader will fsail as miserably as an
inexperienced gambler! The odds are very much infavour of the
house!
Large mutual funds are a good investment vehicle. You can
regularly invest a small amount every month in a mutual fund
instead of stocks, realize better growth than if you invested in
a stock or two yourself. Mutual funds reduce the risk of losing
all your money because they are managed daily by professional
money market analysts. Politics and the economy are very
difficult to predict. Merely not being able to sell in the first
few hours of a crisis can be very very costly to you and your
retirement fund. A Mutual Fund manager will be ready and better
prepared to properly deal with a major shift in the market so we
dont all lose our shirts.
You must Plan and budget to build Savings. If your goals and
your expenses are out of balance -- there's no way you can save
enough to meet your goals -- make a first pass through your
expenses, seeing where you can trim them. Even consider lowering
your goals a little.
It is usually much easier to save $100.00, than it is to earn an
extra $200.00 because of the taxes payable. Roughly $100 in tax
must be paid on that extra $200.00 you earn based on your middle
class tax bracket. So planning yor retirement at a later stage
in your life, starts with a change in priorities. Begin spending
less rather than trying to work overtime to earn more. You may
have to do without some of those "nice to have items" that you
are dreaming of, or you may end up having to eat cat food in
your later years if you don't!
Once you've got some savings accumulated, keep three months
worth in a bank account for short term emergencies. Liquid
assets are the easiest to get your hands on when yo need them.
Dont worry about making big interest on this money. When you
have your emergency money saved, we can talk about
savings-building options, to meet our goals. Once you have your
short term nest egg squirrelled away, you can begin regularly
contributing to long term investments for retirement.
Can You retire at 65? Because of modern medicine, our life
expectancy is longer. Much longer now in 2005 than it was in
1927. Whereas, we used to live until an average age of 61, we
now live to an average age of 78! Do you know? The chances are
that if you live to be 65, there is a 25% chance that you will
live well into your 90's today.
Stock Market Timing .... Making BETTER TRADES ... Short Term Trading ... Day Trading System
Day trading is all about making buy and sell decisions. When you
make a trade either your going to lose money or your going to
make money, and .....
Day trading is all about making buy and sell decisions. When you
make a trade either your going to lose money or your going to
make money, and .....
There is a big problem with this because of our life expectancy,
we need live longer on our retirement savings, much longer! So
it is harder to retire comfortably today! This means that if you
did not start saving significantly when you were young, most
likely you will NOT have enough money to live well, for very
long, after you are retired, unless you win the lottery. But
don't panic! The situtation is still not that desperate.
In fact, Financial advisors are now telling older people not to
retire at retirement age, but instead, keep working. Work, even
part time, as long as you can after the official retirement age.
This helps to build furthur savings or at least stretch the
savings you did have so you can live well in retirement longer
and wealthier. The bottom line is, we all need a lot more
savings and even so, one can no longer retire well on savings
alone - at least not for 20-30 years of retirement - thats for
sure!
What if you dont feel like working into your 70's? What if
Mopping floors at Walmart and flipping burgers for minimum wage
at MacDonalds, until your 70, is not for you? This is the
million dollar question!
Remember my friends statement: "One good investment is worth a
'lifetime' of labor."? If you have an investment that is
bringing-in income, month after month; monthy income for the
rest of your life , then you have succeed in securing a wealthy
retirement for yourself. You can retire and not worry about
running out of savings! Cool. What kind of investment are we
talking about? We know real-estate rental properties are such a
means because they are not a lot of work adn they bring in money
month after month. This is not the only way though.
We are lucky today. We have some really good options for earning
money now. In fact, because of the internet, we have the entire
world as our marketplace now. Via the internet we can all have a
home based-business and a customer base too! All we need is an
internet business that we can tend to a few hours a day...a
business that will generate monthly income for us 24/7/365 days
a year, for the rest of our life.
Here are some Recent Internet facts and Figures:
1. By 2007 there will be 1.1 billion Internet users worldwide. -
IDC, 2004
2. Worldwide broadband subscribers exceeded 150 million in 2004.
- Point Topic, 2004
3. Over 40% of all Americans have made a purchase online. - NDP
Group, 2004
4. Over 75% of online consumers do not care whether an online
store is run by a large or small company. - TNS, 2004
5. $1.6 trillion was made via e-commerce in 2003; $7.1 trillion
is expected in 2007. - Source: IDC, 2004
6. A recent UK study indicated that 82% of Internet users go
online to research products and services. - UK Stats Office 2004
7. More than 60 million Europeans now shop online, an increase
of 50% since 2003. - Forrester, December 2004
8. US online retail sales will more than double over the next
six years, reaching $316 billion by 2010. - Forrester, Aug 2004
9. 61% of small and mid-sized enterprises believe the Internet
is a significant advertising medium.-The Kelsey Group, Nov 2004
10. In 2004, paid search advertising grew by 51% to $3.6 billion
in the US alone. - eMarketer 2004
The internet has big potential and opportunity that we did no
have back in 1927. It should not be overlooked or
under-estimated!
If you can save more, sooner and earn more longer; you will have
secured yourself a fabulous retirement! Hence the name of my
website http://www.BetterRetirementSooner.com
Happy Retirement!
About the author:
http://www.betterretirementsooner.com email:
jtmcnaught@detailsinstantly.com Re-print Rights: You may use
this article in it's entirety, all that I ask is that you
contact me with an email here:
ReprintRights@BetterRetirmentSooner.com to let me know. Thank
You!! ------------------------------------------