How to Get Retirement Right
By Chad Shoop
Seeing as I’m still shy of 30, my retirement-saving mentality hasn’t quite kicked in yet — even though I do contribute to my company 401(k) plan.
I’m still focused on purchasing a car to accommodate my two kids and building up their college funds.
But I usually spend my 70-mile commute to and from work chatting with relatives; often it’s with my grandparents.
One thing I have picked up from my conversations with them is that retirement planning has become more challenging.
Whether it’s constant changes to medical insurance or increased cost of living — thanks to higher taxes and food prices — something always seems to alter their financial burdens in retirement.
And after reading a few retirement surveys, it seems like most of us are not getting retirement right. But you can do something about it…
Rogue Economist Issues Stern Warning to Parents & Grandparents
If you’re a parent or grandparent, you’re going to want to pay close attention.
A best-selling author and rogue economist has just released details of a watershed event that will directly impact the future of America and your children and/or grandchildren. I urge you to see his message for yourself, keep an open mind and then act quickly. Especially if you have money in stocks or you own a home.
You can see his video recording right here.
According to a recent survey conducted by insured Retirement Institute and the Center for Generational Kinetics, more than a quarter of millennials, who are considered my generation, are relying on winning the lottery or being gifted money to survive in their retirement years.
This is not what I mean by doing something about it.
I have played the lotto a time or two, and if you are lucky enough to be gifted money from your parents or grandparents, that’s great. But those two items still may not last you through your retirement years.
That’s because retirement is not so much about the amount of money you start with, but more about how you can stretch those funds over more and more years.
To make that happen, it’s all about generating passive income throughout your retirement years — that’s how you can do something about it.
In fact, there are multiple strategies you can implement in your retirement days, and days leading up to retirement to grow your nest egg. Let me explain.
Take Control of Your Retirement
As you know, there are different types of retirement accounts. Many of you may be stuck in a 401(k) that is not yet fully vested — the level at which your employer match actually becomes your money.
But if you are entering or are in retirement, you might be able to roll your 401(k) into an IRA (individual retirement account) to have more control of your retirement funds — but speak with your accountant first to make sure you do it correctly.
For those of you who already hold IRAs or manage your own 401(k) through a self-directed brokerage account, then you already know what I’m talking about by opening up your world of investments with these portfolios.
However, there’s another strategy I don’t believe many have discovered that is available in IRAs and some self-directed 401(k)s — selling options.
I know, options are considered risky, but selling options is no riskier than owning stocks — in fact, it’s less risky, as long as you know what you are doing.
There are two types of options that you can sell: covered calls and cash-secured puts. Both of these are designed to collect stable and consistent income.
A covered call is when you already own a stock, preferably a dividend-paying, large-cap stock, and you sell a call with a strike price above where the stock is currently trading to collect what I consider an extra dividend.
Selling puts acts a bit differently. You sell puts on stocks you want to own. By agreeing to pay a certain price below where the stock is currently trading, you get paid a premium. The downside is that you may have to purchase the shares at the agreed upon price even if they fall well below that.
These two strategies combined are the bread and butter of my service Pure Income … and it can be used to build and sustain a retirement account throughout your golden years.
Income to Beat the Market
Even though you are not allowed to use margin in a government-ordained retirement portfolio, which is the preferred way to trade Pure Income, cash portfolios also generate consistent returns.
The average annual gain is a steady 8.5%, but that doesn’t do the strategy justice.
In the last 12 months, Pure Income saw just one closed losing trade. In the last 24 months, there were just two losing trades. And since its inception in 2013, there were only four losing trades out of 60 total trades — that’s a 93% win rate for nearly the last three years.
Selling options offers a steady flow of income that easily beats anything that you’re going to find with Treasurys, particularly considering that the Fed isn’t going to be lifting interest rates by a sizable amount for a very long time. What’s more, an average annual gain of 8.5% is looking more enticing right now than what stocks have offered in 2015, with the S&P 500 sitting at a loss for the year right now.
Regards,
Chad Shoop
Editor, Pure Income
