Today’s idea list is going to be about 10 blog posts that I need to write about financial security:

  1. What is Inflation?
    1. Your financial life is drastically affected by inflation constantly eroding away your wealth.
    2. All of your future plans need to take this into account.
    3. Money supply is the root of inflation.
  2. The Saving For Retirement Scam
    1. Personal finance books all say the same thing: cut back on your expenses and save for your retirement in index or mutual funds.
    2. The problem with this is that those calculations do not factor in inflationary dollar cost averaging.
  3. The 401(k) Myth
    1. People who do save for retirement think that once they start pulling down their 401(k) in retirement, things will be fine.
    2. But that doesn’t factor in the tax situation or inflation.
    3. 401(k) income is ordinary income, which, when combined with social security income, will probably put you in at least the 25% bracket.
    4. This will knock down your real returns significantly.
  4. How to Retire without Stress
    1. In order to retire without stress, we need enough income to support our standard of living (whatever that might be).
    2. This needs to grow with inflation.
    3. Inflation adjust your cost of living expenses.
  5. Retire without Stress Plan 1 – Paper Assets
    1. As we saw in the Saving for Retirement Scam, you can’t realistically rely on average returns to support you in retirement.
    2. So you need above average returns.
    3. Calculate 3% and 4% safe withdrawal rates.
    4. Calculate your required IRR taking into account dollar cost averaging and inflation.
    5. Look at various options to achieve that IRR:
      1. Options
      2. Distressed Debt
      3. Dividend Growth
      4. Stock Picking
      5. Momentum Trading
    6. Once in retirement, you may want to shift your portfolio to a more risk-averse style.
  6. Retire without Stress Plan 2 – Real Estate
    1. Cash flow positive real estate is a great option because it provides income to cover your real life expenses.
    2. But there is more than one way to skin a cat.
    3. Play the capital gains game until your asset base is large enough to provide enough income.
    4. Capital gains:
      1. Buying distressed property, fix & flip
      2. Buying from distressed owners, cash is in the deal
      3. Tax Sales
    5. Cash flow:
      1. Rentals
      2. Tax liens
      3. Holding mortgages
  7. Retire without Stress Plan 3 – Business
    1. Create and build a business that you can either sell or outsource to retire on.
    2. If you sell, then you can take your cash and roll it into one of the cash flowing plans.
    3. If you outsource, your after tax profits need to be able to support you.
  8. Paper Assets in  Retirement
    1. Once you are retired, your paper asset investment needs shift from growth to income.
    2. What does this really mean?
    3. If you can construct a portfolio that will be less volatile and throw off income, you can maintain your retirement as long as you need.
    4. Options:
      1. Permanent Portfolio
      2. 60/40 stocks/bonds
      3. Bonds held for income
      4. Extra 1% – Covered Calls
  9. Financial Needs in Retirment
    1. Kids are grown and gone
    2. Health costs will continue to rise
    3. New needs: long term care insurance
  10. Budget Expansion
    1. Step 1: Bookkeeping
    2. Step 2: Review
    3. Step 3: Planning Ahead
    4. Step 4: Cutting Crap
    5. Creating Slack
      1. Once you have your budget dialed in, you can find ways to expand your budget.
      2. Investing
      3. Side business
      4. Whatever it is, it needs to have net profit that can be used in the budget.

 

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