Topic: Your pots of money and thinking long term / retirement / life after retirement (Read 301 times)

I totally understand where you are coming from. It feels kind of wierd to save for 30 or 40 years in the future if we might not even be alive then. The world is such an uncertain place which makes investing for a long period of time very difficult. The big issue with long term investing is that we are able to take a lot of more risks with our investment decisions. If we only want to invest for the next 3-5 years we wouldn't really put all our money into stocks, but with a time horizon up to 40 years we can invest a lot of money into stocks. And over a long period of time, stocks tend to outperform all other asset classes.

You guys do not need to make money from the staking or dividend paying crypto, sure making money on top of having it is great but you could just have crypto and that could go up in price, so you do not have to worry about that. Just buy bitcoin for example and you would be able to retire easily with all the extra money that it makes you could spend that when you retire.

I think about that a lot, that is my dream, I want to retire early, and to think that when I am 70 it will be 2060 and I can't think what bitcoin will be like by then, I am sure it will be millions of dollars per bitcoin for sure without a doubt, that is why I keep investing into crypto because I know that even if I do not get dividends or staking profits, the amount bitcoin goes up will be more than enough for me to retire when I need the money but can't work for it anymore.

Exactly, no matter how much we love bitcoin and defend it, we can't ignore the fact that it is a volatile asset to be able to make it into an insurance for your retirement and future. If you are still legible, I heard that Roth IRA is a better option than a regular IRA and Index Funds is the best passive income stream in my opinion, with Warren Buffett supporting the idea that it is better than actively trading in which he did won the bet. You can make more money if you know where to make one, working until retirement is not the best thing but there will be opportunities that will come along the way like side hustle.

This is a good analysis and I appreciate it. However, when it comes to savings, I'm kind of repulsed by the idea of it because of uncertainty. Everyone of us actually assumes that one day we will get old, we will have healthy bodies, the world will still be the same and we will need money for our needs, but as they say, "there are many slips between cup and lips", I guess if I earn decent, I would just spend most of it enjoying the moment now, and then also do some charities and then look after my relatives, and then if some amount is still left, that would be for my retirement because who knows, I can just die in a car accident tomorrow. While this idea is very repulsive and out of topic, it's just how I think because savings is a big trending topic nowadays which I don't quite understand. But it's important, no doubt on that

That's extremely risky if you're talking about saving for your future.  Anything related to crypto is, but I wouldn't count on any sort of dividend-paying crypto or PoS coin or anything like that to be a reliable source of income.  You'd be much better off either buying an index fund or some stocks that pay high dividends (and keep them in an IRA or whatever's available in your country).

I wish I had pots of money, but I don't.  I've come to accept the fact that I'm going to be working until they put me in the ground--but that's OK.  Some people retire and have no idea what to do with their free time, and I'm afraid that's how I would end up.  Work is good for the soul I've found.

That's extremely risky if you're talking about saving for your future.  Anything related to crypto is, but I wouldn't count on any sort of dividend-paying crypto or PoS coin or anything like that to be a reliable source of income.  You'd be much better off either buying an index fund or some stocks that pay high dividends (and keep them in an IRA or whatever's available in your country).

For someone like me who doesn't have any idea about these S&P 500 index funds or the CAPE, I will likely just go stick with option (C) crypto products like the KCS token that will provide dividends or the Casino tokens that distribute coins as well.

If you are not "rich", that is, you work hard for money a manage to save just some, perhaps nothing from month to month, you should be thinking about how to make sure you can live when old without being a burden for you family or having financial difficulties. If you holdled bitcoin since 10 years ago, you do not need to read any further, just enjoy. For the rest, here are some planning tips.

This is particularly important for Millenials (see graph below), as the rates of return for savings and investments are thought to be in decline.

However, you also want to life a good life - there is only one (unless you are Buddhist) - and you probably want to do things that require money. Striking a balance between these two is a little bit of an art.

How much do you need to saver? Too difficult to say in general. Some speakers and authors will tell you that it should be around 10% of your income, but if you earn little you may not be able to or if you want to retire very early you may need to do some extra effort.

 First thing to be clear, you can separate into bags or pots but in reality all your money is the same. Just use this as mind tool.

b) Decide what is the bare minimun you will need each month or year to retire having the basics: a roof over your head, food in the plate and medical care. This is your retirement minimum bag.

- Figure out how much capital (savings) you would need to obtain that monthly income. (e.g. you need 500 USD and you count on having your house paid). That x12 is what you need in a year (e.g. 12000).

- You should count on getting around 4% of your saving as dividend or rental income. To produce 6000 a year that is: 150.000 USD (that's 6000 / .04). That is your bare survival minimum, so you have to save and invest enough to make sure you have it by the time you think you will retire. Savings and investments for that pot have to be super low risk while allowing you to reach that figure. You may think that you will get a pension and that will take care, but I advise you not to count on that. Just make sure you do not depend on someone else for food.

b) Decide what would be a good level of income that would grant you some travelling, leisure or whatever you would like. Let's say that is 1000 a month on top of you bare minimum. That is you wish bag. You can count for this on pension or other income, just halve what you think would be reasonable (e.g. you expect a state or private pension of 1000 per month, count only with 500).

Now you have to figure out how much you would need for that. Again, at 4% would be (12 month x 1000 = 12.000 a year, so capital should be 12.000 / .04 = 300.000 USD. This may seem like quite a bit of money (it is very personal anyway, people have different incomes).

Since you know your goal, you would now setup your saving strategy, but this time you can take part in more risky (yet higher reward) investments. This should help you reach that apparently high figure if you start saving when young.

c) You moon-shot: If you still are able to save more after your two first bags, you can now have your moonshot bag. You can choose any ammount here, and you will invest this in high risk / high paying investments (e.g. crypto). If this goes well, you will retire early and or rich.

All this requires talking about different investment styles and methods. If there is some interest I will later continue the post with ideas on that.

Just as a hint for Millenials:

What to expect from the typical S&P 500 index fund. Current CAPE is high, meaning that standard returns will not be great during the next 10 years (probably)

20 year investments across different decades:

I use all of these things all together and I can't say that I am rich, I have been working for just 9 years so far which means maybe it will take some more time, but "unexpected" payments cause you to go back to zero when you are not too rich.

I never taken out a loan ever, and I never owned credit card neither, I always lived within my means and never had debt in my life, I always save 10% of my savings forever and never had a problem with that, and I reinvest that money into things to make more money. Why am I not rich? Because, I had to spend that money into things that wasn't expected, health related stuff, parent related stuff, life related stuff in general, not because I spent it on some funny stuff, I spent it on important stuff and that is why I think it is quite important to realize that you could do everything and still not be rich if you get unlucky.

Remember: No one can be super rich and the truest definition of wealth is the amount of days you can hold out without work.

As for how to achieve this, it is mainly related to increasing your education, upgrading your intelligence, and spending more time learning rather than hard work.