For those of you who know John Oliver he had a skit on retirement. It's pretty amazing and I found it sadly funny. Watch this first before going on, it's great.
The truth is, I really do not like financial advisors, at least the traditional ones. But the thing is, most of us don't want to manage our own money as it's easier to put that stress and work on someone else. Usually, the returns from advisors are not that great - they did well from 2009-2016 because all markets did was go up, it was an easy trade: Just buy, keep buying and wait. Now obviously trading is a bit harder. You're taking short term positions and you actually see the price fluctuations on a daily basis v. getting a once a month account statement.
Look at the markets now, we're at all time highs. How many viable companies can you go out and buy and hold? Priceline is close to $1,900 a share of writing this and a company that shares selfies for up to 10 seconds had a $34.7 Billion valuation (I'm talking SnapChat Here).
So you look at this ( or maybe you haven't ) and have to wonder what's next? The markets are not going to continue to go vertical, it just does not happen and never does. So where can you find growth? Where can you find safe yield in these current market times? I won't sit here and pretend to know, I'm not that smart, I'll leave that to guys like Ray Dalio.
For me, and this will be true for as long as I'm around, the answer is in active trading. Whether a stock is 'too high' or 'too low' it just doesn't matter. Whether we're in a bear market or bull market, it doesn't matter. Whether it's an ETF or a future, it just doesn't matter. What matters is this: What does the price chart say and will I be long or short. That's it. This is the life of a trader. And as for retirement planning, I'm not sure there really is ever a 'right' way to do it and I sure hope I can do a good job of it myself as the time approaches.
There are a few parting ideas that I can leave you with that may help and ones that I actually really believe in.
1. Take an active role in managing your money. It takes time but it's probably the most important thing you can do.
2. Don't be afraid to sit in cash and miss a market rally. There will always be another one.
3. Start looking at the fees you pay your advisor and what fees the funds they put you in are. It's really simple.
4. Learn to read a price chart.
Hope you enjoyed the video and the article.