Retirement Planning: 4 Simple Steps

For many, nearing retirement age can get frustrating and confusing. Many fail to properly get their finances in order to be able to enjoy retired life and thus, frustration takes root and tolls heavily on the person. being forty-five or fifty-five, very few people are satisfied with what they have saved for their retirement days. The list of regrets may not end there. Without getting an early start, many things can go wrong. Those that well into their forties and fifties are bound to lag behind. So, here are some practical and simple steps to getting really into retirement planning if you’re a professional, business owner or just someone who cares about the future!

Firstly, the lessons of life are learned by personal experience or by the experience of others. Smart people learn from the latter in order to never experience bad situations after retirement. The very first lesson to learn about retirement planning is to start saving sooner rather than later. It’s not complicated and it doesn’t require you to be a finance guru either. With some willpower, guidelines, and knowledge, planning your retirement can be easy, convenient and above all, blissful.

Invest

Every paycheck should have about fifteen percent invested into retirement. It can be a savings account or a small side business that, if managed properly, can become something to rely on later on. Retirement saving goals are great but enjoying less of your income today would enable you to afford expenses tomorrow! Forget about your employer’s retirement plan, your own gross income must have this percent stashed away in any form for the golden years ahead.

Recognize Spending Requirements

Being realistic about post-retirement expenditures will drastically help in acquiring a truer picture of what kind of retirement portfolio to adopt. For instance, most people would argue that their expenses after retirement would amount to seventy or eighty percent of what have been spending previously. Assumptions can prove untrue or unrealistic especially if mortgages have not been paid off or if medical emergencies occur. So, to better manage retirement plans, it’s vital to have a firm understanding of what to expect, expense-wise!

Don’t Keep All the Eggs in One Basket

This is the single biggest risk to take that there is for a retiree. Putting all money into one place can be disastrous for obvious reasons and it’s almost never recommended, for instance, in single stock investments. If it hits, it hits. If it doesn’t, it may never be back. However, mutual funds in large and easily recognizable new brands may be worth if potential growth or aggressive growth, growth, and income is seen. Smart investment is key here.

Stick to the Plan

Nothing is risk-free. Mutual funds or stocks, everything has its ups and downs so it will have ups and downs. But when you leave it and add more to it, it’s bound to grow in the long term. After the 2008-09 stock market crash, studies have shown that the retirement plans in the workplace were balanced with an average set of above two-hundred thousand. The grown by average annual rate was fifteen percent between 2004 and 2014.

Kewcorp financial is a premiere Sherwood Park-based financial planning team which has more than thirty years of experience in financial planning, investments, insurance and tax planning to name a few. Our professionals are industry experts and have the necessary knowledge and qualification along with the skill to secure your financial future.

What Is A Stop Loss And Why We Need One?

What is a stop loss and why we need one?

Stop Loss is an automatic order that closes our trade once price reaches a specified level. Usually when opening an order we have a choice of entering our stop loss level.

There are 2 types, if we place a sell order then we need to place a stop loss at a certain distance above our entry price. If we place a buy order we need to place a stop loss at a certain distance below our entry price. For Example lets say on EURUSD the price is at 1.22432 and we want to sell so, if we want a 20 pip stop loss. We place it at 1.22632.

Using a stop loss in this way is a method of only risking a small amount of typically between 1% – 5% of our total trading capital per trade. And hence also limiting the losses on our account which puts our minds at rest when trading. The most important part of trading is psychology or put another way its about how you react to that price when it triggers your signal. Or put another way it will affect how you perform as a trader.

When I trade I usually risk about 20 pips per trade. This means if I’m trading at £1 per pip then my risk is £20 and means I would need a total bank of £400 if I was to feel comfortable taking that trade. I wouldn’t feel comfortable if I was risking any more than that and if I don’t feel comfortable then it will affect my trading actions. For example I might hesitate and get in late, or if I see profit but I’m scared I might take profit but this might suffocate a really good trade. So, as we realise getting a stop loss at a level were comfortable with is very important for your psychology which overall will affect your trading decisions which will affect your performance. Just like any sport to that matter.

I’ve often heard it being said that “a true professional trader doesn’t care if he wins or losses”. Well this is true because he knows his method of trading will very probably bring in profit over the long term. What is important is how many trades we win compared to how many we lose and were only going to know this over time. So this is why whether you win or loss if you are a true professional it simply doesn’t matter on one particular day. Its when were losing over many months that tells us we aren’t doing well and need to re evaluate things.

BUT don’t rely on stop loss techniques alone to make your system profitable!

Its a subject of much debate I’m sure on exactly how you use a stop and I’m sure there is more books and websites out there giving much scope on this topic but as far as I see a true long term profitable trading system although I would say needs a stop loss and is very important. It shouldn’t rely on a stop loss technique to be profitable as I’m sure it won’t work long term as usually these types of system end up wiping out your entire capital when things go wrong.

A good trading system must get the direction right the majority of the time otherwise its relying on the stop method which in my view is not the path to long term profitable trading. Lets take Roulette as an example. Now, I’m a fan of online roulette but I can tell you from experience there is no system that can beat roulette no matter what you do. There are I’ve heard over 7000 roulette systems out there. Of them there will be variations of those that rely on a betting method called Martingale. Let me briefly explain:

Martingale basically aims to recoup a loss by doubling the next bet. The allure is strong and quite rightly as so it appears you can’t lose but oh yes you can. You see eventually a long losing streak will wipe out the risk capital of the player. If you look at the roulette player from short term then it will appear they are doing well but if you look at their playing over many months they are very likely to have lost their entire risk capital at some point.

Example:

Balance £100

Bet £1 on Red it Loses Balance = £99

Bet £2 on Red it Wins Balance = £101

Bet £1 on Red it Wins Balance = £102

Bet £1 on Red it Loses Balance = £101

Bet £2 on Red it Loses Balance = £99

Bet £4 on Red it Loses Balance = £95

Bet £8 on Red it Loses Balance = £87

Bet £16 on Red it Loses Balance = £71

Bet £32 on Red it Loses Balance = £39

Bet £64 on Red it Loses Balance = £39

Can’t place any more bets and there’s no way you can get back up to £103 so you have lost

This is an example of relying on a flawed money management strategy to win and not relying on a solid system. Because quite simply you can’t get information or anything to give you an edge on a number. If we do flat betting on Roulette then the casino edge will slowly diminish our balance also. Quite simply can only rely on luck to make profit here.

If we take the stock market though it has elements of predictability, it isn’t fixed odds betting, the chances of price moving in or out of your favour changes all the time. Yes it can be hard but a good system can get it right otherwise there would be no long term profitable traders which I can assure you there are.

Some of the most well known stop loss methods I know of:

Trailing stop

This is where the stop level moves along with the price at a predefined level as set by the trader. For example lets say the price is 1.22432 and we want to sell so we place our stop at 1.22632. Now if price moves lower to 1.22332 then our stop will also trail behind and move to 1.22532 without any input from the trader. Now if the price moves against us the stop will remain at 1.22532 which in effect will protect us from a bigger loss if we left it at 1.22632.

Although this method does have its pro’s and con’s.

Pro’s = It minimizes losses

Con’s = It doesn’t allow your trade to breathe and therefore diminishes some possible good moves.

But it all depends on the type of system you use. I think its not bad for if your system predicts breakouts.

Break Even

When price moves in profit by a certain amount as set by the trader the stop loss is moved from the stop loss level to the entry price there bye protecting the trader from any losses.

For example lets say the price is 1.22432 and we want to sell so we place our stop at 1.22632. If we think we should move stop to break even when we are in profit by 20 pips. When price reaches 1.22232 then the stop is moved from 1.22632 to 1.22432 our entry level.

I find this type of stop loss method good for swing trading or when your system plans on holding the trade over a day for a good trend.

Although this method does have its pro’s and con’s.

Pro’s = It allows you to hold onto your trade for as long as you think price will move in your favour.

Con’s = As markets do fluctuate it sometimes can stop you out and so miss out on any profits.

It all depends on how the market behaves and it think this method relies on further judgement of the markets behaviour.

50% Lock In

This method involves firstly allowing the trade to breathe and so is suited to holding the trade over a day or 2 and locking in half of what’s there. Its good because it allows our trade to breathe and is in line with the golden rule of holding on to winners.

I would normally trade this as so:

I would enter a buy order at 8am say the EURUSD at 1.22432 with a 20 pip stop loss at 1.22232. I come back at 12pm to see price is now at 1.23032 which means im in profit by 60 pips. So I would move my stop to a 50% level at 1.22732, so now I know ive profited no matter what but still have a possibility of making more profit if price was to move higher.

Stop Reversal

This is when we place an opposite order on a stop loss level. This is an effective method for counteracting when you get the trade wrong. It works thus, you would enter a buy order on the EURUSD at 1.22432 with a 20 pip stop loss at 1.22232 but you would also place an opposite version of that sell order at this stop loss level of 1.22232.

My personal favourite is holding over days while stopping the major peaks

With my system you might only be risking 20 pips but every 3-4 trades place will see profits of over 100 pips because using my favourite is the 50% lock in with a slight difference. Instead of locking in the 50% level I instead look at the previous major price peaks and place my stop at these levels. Price peaks give a better idea of true market direction so what better way to hold onto that direction than using price peaks, as although price fluctuates, if its for example shorting then price shouldn’t rise above the previous peaks until there is a major direction change.

What is profit factor ratio and your ideal risk to reward ratio?

Ive seen many many trading systems and they all look great on paper but there is one thing they never show and its down to you to find your self. Its the Profit Factor Ratio or PFR. This is where you find the ratio of you profits to your losses. If over many many trades its still above 1 then your system is profitable. This one major point is what all trading systems don’t actually show you, but is what you need to be a true

profitable trader.

There was 1 system I remember in particular which I guess stuck with me and is what led me to the goal of holding a trade over a few days for maximum profits while risking only a small amount. Obviously I can’t give names here but the main promise was most trades make 100+ pips profit by lunchtime. Now like all systems you read about they always show you the good while glossing over the bad. What they don’t show you is the reality of how that system performs. You can only see the reality after you have bought the system and experienced trading it yourself.

So we must backtest and find the systems true PFR.

From experience my trades usually end up with a risk reward of 1 to 4 meaning for every £1 invested I expect a £4 return for if that trade wins. This statement is irrelevant what really matters is the profit factor ratio. Or simply your profits / losses. If its above 1 then your in profit. It depends on how high above 1 as to how fast we can profit and how much we profit can make. So when trading I always inspect my system is working and making sure the PFR is > 1.

For example lets say I placed 1000 trades with a strike rate of 1 in 4, and each winning trade to make £20 while a losing trade makes £5. We can expect 250 winners and 750 losers. Sounds bad at first, 750 losers Oh No! but watch:

250 winners at £20 a win = £5000

750 losers at £5 a loss = £3750

So,

Profit / Loss = PFR

5000 / 3750 = 1.33

Our PFR is 1.33 that is I would say a realistic PFR. Trading at £1 a pip means we will profit £1250 over 1000 trades placed. £1250 profit from a £100 investment is serious money making potential. Of course this is a conservative PFR there are many systems out there with higher PFR. I’ve read that most systems realistically reach just under 2.0. Mine is 1.33 I can live with that.

How to Make a Lot With a Small Investment

Saving becomes a necessity once people get close to the retirement age. At that stage in life, saving is not just an option, but it is a key to having a stress free retirement. However, having plenty of savings do not guarantee a stress-free older age upon retirement. With countless responsibilities, upon retirement with no source of a steady income, you could end up diminishing all your savings. With a big chance of mismanagement of the savings, it is essential for financial advisors to suggest that people and, in specific, retirees must consider investing their money in exchange for fruitful returns.

Making a Smart Investment Decision
Making smart investment decisions is fruitful for any age and anyone. It is the best and the most reliable way to get a steady income. Before taking a major decision to invest, consult experts for advice and consider the following steps for safe investments.

Know your Risks
Always do your homework before choosing a company for investment. Although it is always a good idea to ask an expert investor for tips and advice, do your own research too. Do not pick a company that has unreliable information about their returns. The lack of necessary knowledge could cost you all your savings. Always ask how the investment will work, study the terms and conditions when making an investment decision.

Have a Portfolio Investment
A good idea for investment is to invest in small but safe investments. The safest way to do this is to invest in a portfolio. Instead of putting all your money in one investment, create a portfolio of mutual funds, stocks or shares, and other financial investments. This way if one fails the other investments in your portfolio could reap positive returns.

Choose Investments with Immediate Annuities
Annuities are reliable for those who need guaranteed payouts. Once you decide on investing in annuity funds, it automatically qualifies you to get an income exchange for a major series of payments over a specific time. With so many annuities, each one has a unique feature that could be expensive. Before making any investment decision or investing in an annuity, consider talking to an expert.

Strategic Positioning of the Investment
Strategic positioning of the investment depends on the attractiveness of the entire sector of a specific industry. It is essential that the company you choose for investment have a strong market share. A strong company with a major market share will prove as an effective investment.

7 Ways on How to Invest For Your Retirement

Investment Plan for Your Retirement

There so many investment plans available out there. The following points will guide you to choose the most appropriate one for you with lesser risks and commitments to manage. The points are based on the fact that, after a while they are going to be appreciating business ventures for your retirement.

1. Annuity

Annuity is a plan whereby an insurance company in exchange for purchase price enters into a contract to pay an agreed amount of money every year while the annuitant is still alive.
Annuitant- is the person on whose life the contract depends.
Annuity- is the amount of money paid to the annuitant.

The benefits of an annuity especially when used in connection with retirement provision is that it would ensure that the retiree has an income for a convenient number of years. The best type of annuity is deferred annuity because it gives you life time benefits.

2. Bonds

A bond is a loan to either a government or a corporation, whereby the borrower agrees to pay a fixed sum of interest usually semi-annually, until your investment in full. Treasury bonds are secure, medium to long-term investments that typically offer you instant payment every six months throughout the bond maturity. Treasury bonds have a fixed rate meaning that the interest rate determined at auction is locked in for the entire life of the bond. This makes treasury bonds predictable, long term source of income.

3. Exchange Traded Funds (ETFs)

Exchange traded fund is an investment fund traded on stock exchanges just like stocks. An ETF holds assets such as stocks, oil future, foreign currency, commodities or bonds and generally operates with an arbitrage mechanism to keep its trading close to its net asset value, although deviations can occasionally occur. These assets are divided into shares where shareholders do not directly own or have direct claim to the investments in the fund.
ETF shareholders are entitled to a proportion of the profits such as earned interest or dividends paid.

4. Stocks

In Kenya the main stock market is Nairobi Stock Exchange (NSE). A stock market is a place where public limited companies and other financial institutions, come to buy and sell bonds and other derivatives. NSE acts as a third-party broker and allows investors to buy and sell shares independently through share dealing platforms. You can directly and indirectly invest in stocks. Direct investment means that you buy shares from a company and become a shareholder while indirect means you invest in more than one company therefore spreading the risk. Indirect investment is done through an open-ended fund and the money is secure so that even the company defaults the money is still safe.

5. Mutual Funds

Mutual funds are some of the most overlooked yet probably the easiest way to invest much more than both stocks and bonds. A mutual fund is a pool of money, often from similar minded investors. You can sell your shares when and if you want. All shareholders of the fund benefit from the fund and share in any losses. There are five categories of mutual funds where you can choose the one which best suits you.

6. Real Estate

Real estate is a retirement investment plan you should never overlook. Landon said ‘look for what’s going to give you the most bang for your back’. Real estate as a front is a very lucrative opening. However, one must research the market and know the current and emerging trends in the sector. The location of the real estate matters a lot and should be well selected. Some of the major locations can be near universities, developing towns or big company sites. In any investment capital becomes the main organ to jump start the investment. Research on different financial organizations and try to compare their payment and funding terms. You can still opt to become a Real Estate Trader. A real estate trader is one who buys property with the intention of holding them for a short period and sell to make a profit.

7. Pension Plan

Pension plan is a retirement plan that requires an employer to make contributions into a pool of funds aside for a worker’s future benefit. The pool of funds is invested on the employee’s behalf, and the earnings on the investment given to the worker upon retirement. In Kenya even self-employed workers can still contribute to the social security fund to help them when time comes.

Retirement is a process where every living worker must come to terms to. Retirement is just like any other investment but a more crucial one since when you retire you productivity goes low due to health and age. You can start now and by the time you retire have significant benefits that can help you live a befitting like after retirement. Take a step today and plan to invest for your retirement now and be a happy retired worker living a good life and building the economy even at old age.

Practical Tips on How to Trade Cryptocurrencies

For some time now, I have been closely observing the performance of cryptocurrencies to get a feel of where the market is headed. The routine my elementary school teacher taught me-where you wake up, pray, brush your teeth and take your breakfast has shifted a little to waking up, praying and then hitting the web (starting with coinmarketcap) just to know which crypto assets are in the red.

The beginning of 2018 wasn’t a lovely one for altcoins and relatable assets. Their performance was crippled by the frequent opinions from bankers that the crypto bubble was about to burst. Nevertheless, ardent cryptocurrency followers are still “HODLing” on and truth be told, they are reaping big.

Recently, Bitcoin retraced to almost $5000; Bitcoin Cash came close to $500 while Ethereum found peace at $300. Virtually every coin got hit-apart from newcomers that were still in excitement stage. As of this writing, Bitcoin is back on track and its selling at $8900. Many other cryptos have doubled since the upward trend started and the market cap is resting at $400 billion from the recent crest of $250 billion.

If you are slowly warming up to cryptocurrencies and wish to become a successful trader, the tips below will help you out.

Practical tips on how to trade cryptocurrencies

• Start modestly

You’ve already heard that cryptocurrency prices are skyrocketing. You’ve also probably received the news that this upward trend may not last long. Some naysayers, mostly esteemed bankers and economists usually go ahead to term them as get-rich-quick schemes with no stable foundation.

Such news can make you invest in a hurry and fail to apply moderation. A little analysis of the market trends and cause-worthy currencies to invest in can guarantee you good returns. Whatever you do, do not invest all your hard-earned money into these assets.

• Understand how exchanges work

Recently, I saw a friend of mine post a Facebook feed about one of his friends who went on to trade on an exchange he had zero ideas on how it runs. This is a dangerous move. Always review the site you intend to use before signing up, or at least before you start trading. If they provide a dummy account to play around with, then take that opportunity to learn how the dashboard looks.

• Don’t insist on trading everything

There are over 1400 cryptocurrencies to trade, but it’s impossible to deal with all of them. Spreading your portfolio to a huge number of cryptos than you can effectively manage will minimize your profits. Just select a few of them, read more about them, and how to get their trade signals.

• Stay sober

Cryptocurrencies are volatile. This is both their bane and boon. As a trader, you have to understand that wild price swings are unavoidable. Uncertainty over when to make a move makes one an ineffective trader. Leverage hard data and other research methods to be sure when to execute a trade.

Successful traders belong to various online forums where cryptocurrency discussions regarding market trends and signals are discussed. Sure, your knowledge may be sufficient, but you need to rely on other traders for more relevant data.

• Diversify meaningfully

Virtually everyone will tell you to expand your portfolio, but no one will remind you to deal with currencies with real-world uses. There are a few crappy coins that you can deal with for quick bucks, but the best cryptos to deal with are those that solve existing problems. Coins with real-world uses tend to be less volatile.

Don’t diversify too early or too late. And before you make a move to buy any crypto-asset, ensure you know its market cap, price changes, and daily trading volumes. Keeping a healthy portfolio is the way to reaping big from these digital assets.

Do you have a website that needs investing or technology content? Struggling to get a writer that understands your needs? Get in touch with me via Twitter or LinkedIn and I’ll help you out!

How To Identify Rare Comic Books

Among all of the worldwide categories of collecting, comic books are relatively new. At one time, only kids were interested in reading them for entertainment. In June 1938, Superman, the first superhero appeared in Action Comics #1, most kids were attracted to the man dressed in blue and red holding up and crashing a car above his head. Suddenly, a run of other types of superheroes had most kids paying a dime to buy one. If they had a dollar, they could have bought ten books with zero tax. However, kids read them up to a certain age and their mothers generally threw them away, which is a shame because they would have been valuable.

So, can comic books still be lucrative investments? Absolutely. This is why so many serious collectors wish they had time machines, so they could go back to the past to buy those good oldies. They could imagine getting their hands on Action Comics #1, or Detective Comics #27(the first appearance of Batman) and selling them for millions of dollars today. However, collectors must put fantasy aside and look to more recent and possibly less expensive prospects.

What kind (genre) of comic is it? For this article, I refer to the most popular superheroes. Although they are usually worth more than other genres that include: Cowboy; Romance; Famous Cartoon characters like Disney, Warner Brothers; War; Comedy and others.

Period: Comic books belong to different “ages”: “Platinum Age”(Printed on or before 1938); “Golden Age” (1938-1955); “Silver Age (1956-1969); “Bronze Age” (1970-1981); “Copper Age” (1981-1991).

Is the book “DC” or “Marvel”? Some better known DC superheroes include Superman, Batman, Robin, Wonder Woman, the Flash, and Green Lantern. Marvel Comics began in 1939 with Captain America, Human Torch and the Submariner. Before 1961, Marvel Comics were originally named “Timely Comics”. Some titles became popular, such as: “Tales to Astonish”; “Amazing Fantasy”; “Tales of Suspense”. These titles introduced some of the famous characters that movies widely feature today: Tales to Astonish 27 introduced Antman; Amazing Fantasy #15 introduced the world to Spiderman; Tales of Suspense #39 featured the first appearance of Ironman. Other well-known comics brought groups of superheroes: Fantastic Four #1 (1961); The Avengers #1 (1963), The Xmen #1 (1963).

Edition Numbers: The lower the edition number, the more the book will be worth. As you know from the last paragraph, many heroes’ first appearance didn’t originate in issues #1. Superman originated in Action Comics #1, but, a year later he got his own comic book – Superman #1(1939). Also, Batman got his first appearance in Detective Comics #27, but soon got his own comic with, the first appearance of Robin – Batman’s sidekick in Batman #1(1940). Wonder Woman’s first appearance happened in Sensational Comics #1, which later became “Wonder Woman”.

Original price: Comic books have gradually increased their newspaper prices. The lower the original selling price, the older they are and in most cases worth more: $.10, 12, 15, 20, 25, 30, 35, 40, 50, 60, 75 (from 1938-1988). Today, the lowest priced comic books cost around $3.99-$4.99.

Condition: If your book either has tears, a partially detached spine, or missing pages – it will be worth significantly less. They can be restored, but repairing them costs more money and it will sell for less. The more pristine the condition, the more it will be worth, of course. All books should be placed in Mylar sleeves with cardboard backings. The ultimate protection for comic books would be to get them hermetically sealed in a hard plastic display case, which is provided by “CGC”, or the “Certified Guarantee Company”. CGC is one of the only organizations that can truly give peace to the collector that the book has been graded properly and can almost never be damaged.

When Will Cryptos & Blockchain Really Explode?

Every day there is more news about what can, may, and should happen in the world of Crypto Currencies (CC’s) and Blockchain. There has been significant investment, research, and lots of chatter, but the coins and the projects are still not mainstream. They have not yet delivered the explosive changes envisioned. Many ideas are being discussed and developed, but none have delivered big game-changing results. What may be needed is for big industry players, like IBM, Microsoft, and the large financial services corporations to continue forging ahead in developing useful Blockchain applications – ones that the whole world can NOT live without.

Financial services are a ripe target for Blockchain projects because today’s banking systems are still based on archaic ideas that have been faithfully and painfully digitized, and because these systems are archaic, they are expensive to maintain and operate. Banks almost have a good reason to charge the high service fees they do – their systems are not efficient. These systems have many layers of redundant data, as everyone involved with a transaction has to have their version of the transaction details. And then there is the business of ensuring that there is a trusted third party to clear all these transactions – requiring even more versions of the same data. Blockchain technology holds out the promise of addressing these issues, as each transaction will be captured in just ONE block on the chain, and because it is a distributed database, security and integrity is built-in and assured. It may take some time to build up trust in these new systems, given that the verifiers of Blockchain transactions are not the traditional clearing houses that banks use and trust today. Trust by the banks in a new technology will take time, and even more time will be needed for that trust to trickle down to consumers.

Another company that may soon be ready to give CC’s and Blockchain a big boost is Amazon. It looks like Amazon is getting ready to launch their very own crypto currency. This is a company with revenues the size of a good-sized country, and they are in a position to issue a digital token that would be fully convertible with other CC’s, and fiat currencies too. A move like this would enable Amazon to:

issue (AMAZON) coins to reward and incentivize developers on any of its platforms
issue coins to consumers to use for in-app purchases
issue coins to game players for in-game purchase of virtual goodies
issue coins to regular customers as part of a loyalty programme
Amazon may have the ideal ecosystem of customers and partners to make this all happen. Worldwide they have about 300 million customer accounts, roughly the population of the USA, and they have 100,000 sellers on their platforms, with millions of items for sale. There is hardly a more mainstream company than Amazon, with a massive, vibrant economy all linked in. Amazon’s imminent entry into the world of CC’s may signal the adoption of blockchain technology by mainstream institutions on a large scale. What could be just around the corner if an AMAZON coin comes into play is the likes of a DISNEY Coin, a DELTA AIRLINES coin, a CARNIVAL CRUISES coin, a HOME DEPOT coin – you get the picture.

7 Steps to Retirement Planning to a Safe and Secure Future

Retirement is a tricky thing, one day you feel good about it as you will be relaxing, finally, and the other day you feel worried about your finances. But people who plan for their retirement beforehand may have little or nothing to worry.

Retirement planning is a continuous process, and you would have to try to foresee things. Although, no one can predict everything and it will be better to try to be close enough can do some benefit.

Many people are too scared to retire because they are worried about how things will go when they cut that income off. However, retirement planning is not a hard science and following these 7 steps may let you secure future.

1. Retirement Planning – Assess your financial situation

First of all, make an inventory of all your current assets, liabilities, incomes and expenses. You can sit with your retirement planner and make an estimate of what your responsibilities and expenses would be. When you’ve retired, some expenses may stay the same, like groceries and insurance, and others.

However, some expenses may increase like travel cost, vacation costs, and spending less on growing-up kids. Some expenses would also be taken care of by pension and social security. Highlight your worries and questions that haunt you at night and discuss them with your planner.

2. Calculate the value of your assets and Liabilities

Here are a few tips on how to calculate the value of your current assets.

Write down the current amount in each of your account where you keep cash and liquid savings. These include checking, savings and money market accounts and certificates of deposits.
If you have saving bonds, then calculate and determine the current value or call the bank to find out the current value.
Call your agent and find out the cost of your whole life policy also.
Invested in stocks, bonds or mutual funds, then check the value on financial websites or from your last statement.
Use the current value of your house and other real states.
List the current value of your pension, IRAs, or other retirement plans you have in mind. Try to know the value if you decide to get them cashed today.
Keep other assets such as business and rental property in mind too.
The balance of the mortgage on your house is a monthly liability.
Keep all other mortgages or home equity loans in mind as well.
Record the balance due on credit cards, installments, loan, and investment accounts.
List all the current and over-due bills you owe. These include utility bills, doctors, dentists, telephone, water, gas, property tax, etc.
3. Know what you want

We all want so much that we confuse ourselves with so many things. Make up the list of the things you think must be in your lifestyle after your retirement. Consider everything that may even seem small to you so that you would be prepared for it.

Are you aware of how much money would you need to retire and live comfortably?

Well, research says that you need to replace 70-90 percent of your pre-retirement income. It helps you to estimate your target based on your current income. Although it is a rough estimate, and keeping this in mind allows you to be on track. Maintaining factors such as vacation habits, medical expenses, house rent will have a substantial impact on how much you need to save.

If you can save a right amount of money for retirement, then you will also have options for living the kind of life you want. Proper retirement planning lets you overcome any barriers and constraints, and add to the leisure of golden retirement period. You might even also have enough to leave something for your next generation. Don’t be scared to aim high!

4. Cash Flow Planning

Present value is significant for your retirement planning. It is the amount of money you need in your account today to plan and save for your future. Many people work with their financial advisors or their retirement planners and make individual retirement accounts to prepare for their retirement. You can do so while planning before and after retirement.

Planning Before Retirement

Budgeting
It is almost impossible to start any retirement planning without budgeting. Your budget is an essential part of your cash flow planning for both before and during retirement. It is an essential analysis that one should necessarily do to determine how much cash is needed to maintain the lifestyle you and your family is used to living.

Once your budget is in place, it should be reviewed annually to determine if the addition and subtractions are changing the planned budget or if any other adjustments are needed. A budget will also help to protect your long-term and retirement savings.

Emergency Fund
Let’s face it, unexpected financial problems can arise anytime, and it’s not easy to avoid them too. So, it’s always a good idea if we have some savings to help you in your inevitable needs.

Your emergency fund should be set aside in a liquid manner because you never know what time or situation you might need those. The total amount needs to be decided by you and your family, and it should be at your comfort level. Some people might agree on having $10,000 or $20,000, whereas some people would want to put a higher amount for their emergency funds.

Risk Management
One area that is often overlooked in retirement planning is risk management. People usually focus on saving money for retirement. However, they forget to keep risk management in their minds. Risk management includes car insurance, house insurance, short-term and long-term disability, and health insurance. You need to make policies regarding these and should be monitored, reviewed and updated as needed.

Planning During Retirement

Budgeting
During retirement, your plan should again start with budgeting. Your income will be changing after retirement, so it is essential to monitor your cash flow through-out retirement.

Budgeting after retirement does not only mean to keep a check on the flow of cash. In fact, it also involves analyzing all your expenses throughout the year. It lets you identify places where you can use other or less expensive substitutes or how to plan a significant expenditure.

Taxes
Tax planning is a massive ordeal for some retired people. It takes up a lot of planning regarding analyzing the sources of funds. It allows you to maintain your lifestyle and hence you need to keep your tax consequences in mind.

Different types of accounts have different types of tax consequences when funded or get withdrawn. Retirement savings or qualified accounts are taxed as ordinary income level. Non-qualified accounts are taxed with capital gains levels.

When specific funds are needed to maintain a lifestyle during retirement, it is essential to keep the tax consequences of the accounts funding your retirement.

Taxes should not be the only consideration when making your retirement planning. Instead, it should be combined with other aspects of your overall financial planning.

Estate Planning
While necessary estate planning is a critical component before retirement, but post-retirement planning has a more important role in managing real estate. It is essential for you to determine what you and your family would like to settle for.

What is crucial is that the approach to estate planning should be similar to your attitude towards risk management. Your estate plan should be reviewed and updated regularly.

5. Invest or Save

It’s entirely okay if you start late as well. The key to expecting success has a positive outlook and understanding that being late is better than never starting!

If you are over 55 years of age, the government offers savings on the catch -up contributions so you can get help to save a little bit more. Sometimes, the chances are that savings account and employee pensions are not enough to reach your goals. That’s when you explore investment products.

It is always good to have an investment on your side if you are planning to upgrade your living standard and staying financially sound for long. There are many different ways to save your money, but IRA accounts have proven to be the best. If you do not know about it yet, then search the mighty internet for guidance.

Create a diversified portfolio of savings accounts, investments, stocks, bonds, property, and insurance that can all contribute to benefit you.

6. Make Strategies to Maximize Your Social Security Income

Social security is likely to remain an essential part of your retirement planning, and it is essential to maximize this benefit.

To maximize the benefits of social security, you need to sit with your retirement planner and make effective strategies for collecting social security. The age at which you decide to withdraw funds will also have an impact on your lifetime savings. You can start receiving from the age of 62. Moreover, the more you wait, the more you will be paid. If you wait till 70 years of age, your payment will increase up to 77%.

Another important thing that you should be aware of is if you’re eligible for more than just your own retirement benefits! You might also be eligible to claim “spousal” or even “survivor” benefits, if you are married, divorced, or widowed. Although, these are based on your records with your spouse, whether they are dead or alive.

Remember not to file for two or more types of benefits at once. Chances are you will lose one of them if you file for both simultaneously. Make strategies to claim the smaller one first, and later on the larger one.

Social security uses the best 35 years of your working life to calculate your monthly earnings. If you have worked less than 35 years, you should keep working. As this will also help you to bump some of your lower earning years.

7. Check and Repeat

The most important thing to keep in mind while doing retirement planning is to focus on your savings. It needs to be updated and changed as needed. Review your retirement plan annually. Nothing is set in stone and with a strong and stable planning leads you to live a happy retirement life. All you need is to put yourself in a position to be successful and organized.

Retirement is a life transition process. Just like other major life transitions, retirement requires you to adapt and grow. It might involve some sad moments for you like leaving your workplace, workmates, moving houses, having ups and downs, being short on money, etc.

However, these grieve moments don’t last forever! The efforts that you make before and during retirement to have a balanced life will help to ensure that your retirement is a smooth and pain-free process.

Although the act of retirement happens in a day, or a week. In fact, the retirement process is taking place over the years before your actual departure. Retirement cannot be successful overnight and it requires in-depth planning and preparation. Your retirement plan might even change at some points in life, depending on your interests, activities, and health fluctuations.

The Investment Mistake Otha Anders Made

In 2015, an elderly Louisiana gentleman cashed in at a nearby bank, a truckload of 55-gallon plastic water jugs of pennies that he had collected over the previous 45 years. After the last penny had been counted, Otha Anders received over $5,130 as the total amount for his pennies. That’s over 510,000 pennies. To the general public, this news probably sounded wonderful, but to every American numismatist who collects and buys coins for fun and profit, Anders lost a lot of money.

According to the News-Star of Monroe, La., Anders referred to each of his pennies was a “God-given incentive reminding me to always be thankful.” In Anders case, however, a “penny saved” may be more than “a penny earned.” Many of those that he cashed in to get instant money, would have been worth more money.

Since Anders began his penny hoarding in 1970, he would have picked up many “wheat” pennies that the Mint struck between 1909 to 1958. Even today, there are still many “wheat” cents in penny rolls and circulating change. When he started saving in 1970, he would have found many wheat cents in great condition. Over the last 45 years, most of each of those pennies would become more valuable than one cent.

According to the “Guide Book of United States Coins 2015″ by R.S. Yeoman, wheat cent values ranged from $.10 in “good” condition to several hundred dollars in “almost” uncirculated condition. Also, the guide records a few extremely rare pennies that were worth up to $5,000 in uncirculated conditions. However, it would be impossible to estimate how much the numismatic value of the entire collection might be; each coin would have to have been examined by reputable coin dealers who could have helped him sell his collection, but it’s easy to imagine Anders would have made over $20,000 if he had had the patience to get them evaluated.

In addition to numismatic value, there is a precious metal value for the price of all of the coin’s weight in copper. All American copper coins struck until 1981 contained 95% copper. According to the “InvestmentMine” website, in 2015 the average value of copper was $2.86 per pound. All of Anders’ pennies together weighed over 2,800 pounds. So, if he picked out all of the coins, we’d multiply 2,800 pounds and 2.86 the sum in copper would have been a total of roughly $8,000. However, a conservative estimate of the number of pennies made of copper was 75%, we’d get about $6,000, which is about $900 more than he received.

Although Anders received over $5,100 for his enormous collection, he could have gotten much more if he took the time to get all of them evaluated by a trained numismatist. However, the good news is that if you live in or near Louisiana, you could buy many rolls of pennies from local banks and probably find some of those higher valued wheat cents.

Investment Lessons Learned From Warren Buffet

Most people try to invest and make money but they often end up suffering losses as they make the same mistakes over and over again. Wannabe investors should try to learn and emulate the mind sets of rich people such as Bill Gates, Mark Zuckerberg, Michael Dell and Warren Buffet. Let us focus on Warren Buffet, who has been described as the best investor on the planet. These are some of the investment tips he sticks to:

1. Developer your investment mindset

Not all people are business oriented but we can improve our business minds by reading business related books. Warren Buffet invests a lot of his time studying business-related books.

2. Practicing patience in your investments

Whenever Buffett buys a stock, he buys into the company. This means he doesn’t sell the stock at every market boom or bust. He believes in the companies that he invests in for the long term and holds on to stocks until he longer believes or sees value in these companies. One of Buffett’s celebrated quotes, which illustrates his inclination for long-haul investments is, “Regardless of how awesome the ability or endeavors, a few things simply require significant investment. You can’t create a child in one month by getting nine ladies pregnant.”

3. Prioritize value

Sometimes, the amount we spend on something and the value we get from our purchase don’t relate. Buffett believes that investors need to understand that markets are driven by supply and demand and that buying into a company with solid growth during market down-turns are great opportunities to gain value. Buy a good stock at a great price.

4. Check your emotions when investing

Human emotions influence the market considerably more than any monetary model. Emotions can make people hopeful for something that has never happened or rarely occur. Buffett has recommended that controlling your emotions is considerably more imperative than your IQ. According to him, “Accomplishment in investing doesn’t associate with IQ. What you require is the demeanor to control the urges that cause other individuals harm in investing”.

5. Invest in what you are knowledgeable and passionate about

Buffett exhorts that you “never put resources into a business you don’t get.” Don’t put money into companies whose business you don’t understand.

If you don’t have adequate information about a company, it is much more difficult to understand how a company will perform in the long run and foresee what the company will become a couple of years down the line.

6. Live below your means

Despite a net worth of $87 billion dollars, Buffett lives in a shockingly unassuming home. He purchased his current home in Omaha, Nebraska for $31,500 in 1958 and, today, he calls it the 3rd best investment he’s ever made. Rather than wasting money to live lavishly, Buffett lives frugally and has reaped the benefits.

7. Save first then spend the rest

People tend to pay bills first, spend the rest, and save for last. According to Buffett, this is the wrong approach. Buffet prescribes that you should put aside a set amount of money each month as savings first, then pay your bills, then spend whatever is left over after paying bills.

8. Remember your roots

When he was in middle school, Buffett found a job as a paperboy delivering The Washington Post. He expanded that early activity into a deep-rooted association with the daily paper. Years later, his company, Berkshire Hathaway, became The Washington Posts’ biggest investor. Remember where you came from, your values, and you may discover unique opportunities for great investments.