When it gets Real

My son joined the United States Marine Corp about three and a half years ago.  It was a good place for him to find confidence and direction.  That has happened in spades. Like me, he gets the impulse bug and just wants to dive in and research later.  So coming out of the marines he wants to know how to invest.  He had to work through the low lying fruit like Navy Federal and USAA.  They do have vehicles, but they cannot compete with the big investment house.  He mentioned Vanguard as an option that he had and I encouraged him to jump on ot quick.  That is a well managed company with great fund managers.  That will be money in a Roth IRA that will be a diversified mutual fund more geared to securities versus bonds.  More time means more risk tolerant.

Then the next conversation was on day trading.  This is where as a kid, he is brilliant, but needs to put the research into it.  I asked him to tell me what he knew about day trading because two things happen.  One is you are married to the terminal so you can sell at the exact blip that you are looking for.  The other is to know that people get crushed in day trading and they look like guys trying to sell their watches in Atlantic City so that they could get back to gambling.  Day trading has to have a lot of people at the tail end of the rise.

The direction he wanted to follow was one who did pump and dump with penny stocks.  I told him that at its core it is fraud.  They get everyone to get in and when they make there money, they get out and everyone else fends for themselves as the stock normalizes on the way down.  The problem is that you bought to late into the pump and the drop down has made you upside down. This means you hold a loss on paper for a penny stock that is highly unlikely to go anywhere unless someone tries another pump and dump play.

 

I sent my son newsletter and tons of support for shorter term plays that all are based on phenomenal accounting and finance rating.  Place an order with a trailing 25% sell so if it tanks, your loss is minimized to twenty five percent of your investment.

This is where my son looks more like the young me.  He knows what companies are relevant today and he will tinker in and out. he will learn more about the companies overtime and probably get pretty good at reading the tea leaves.

The funny part is I know what I believe, but even after giving free education, it does not change what young blood will actually do.  I do feel great that he is in Vanguard, I will take that as a win.

 

In Control

Most people want to retire early so they can take control of their future and destiny.  The idea is to remove the stress that comes with not having enough money.  What is the best way to have a stress free life.  Money is only one variable that people trying to fix.  Money does not create happiness, it only removes an area of worry and concern.  It is also possible to not know what to do with money once you have it and you just watch it slip through your fingers.

It is important to understand the why.  Once you understand that, then you can motivate yourself on a daily basis.  That helps you stay in the grind and do the extra things that most people do not want to do.  At the same time, if you do not have balance in your life then you will just introduce another variable that is harder to control.

We all need healthy relationships.  We need a healthy family life.  If spouses opt to spend too much time at work and less with the family, their are intangible costs that for many are just too costly.

The secret to happiness comes from being thankful for everything that you have been given.  That thankfulness will keep your head locked in a healthy and positive focus.  It is possible to be a servant to others and still be successful yourself.  I had a mentor tell me once that when you help people get what they want, they will help you get what you want.  The application point is to be a giver and not a taker.

The more prudent we are with our spending habits, the more generous we can be with our abundance.  Again the why is a critical determining factor of success and taking the best path to getting there.