Self-investing starting at a young age can ensure a successful financial future and an early and comfortable retirement. So why is nobody doing this? The answer is complicated and includes such factors and the social pressures facing our youth, certain pre-conceived ideas regarding our ability to successfully self-invest and the education or lack thereof needed to motivate our youth to undertake such a long-term project.
How often have we heard the expression “if I only knew then what I know now….” You said it, I said it and many of our friends and family have also used that comment because it is true. By the time we realize that we should have, would have and could have, we start playing catch-up and in many cases it’s too late. Our youth is simply not educated in a practical manner as to how to self-invest despite the fact that it is one of the most critical skills they need to be taught. My hope is that my new book will, in some ways, change that and have a lasting impact on the quality of life of our children. I have always wanted to write this book but covered call writing took a front seat to my time and effort as I spent the past 6 years focused in that arena. In mid-2012, I decided it was time. My goals were two-fold:
Educate our youth on the basics of stock investing so the concept will not be intimidating
Set up a user-friendly game plan based on historical statistics that will lead to a wealthy and secure retirement
The book was written in a way that I would have wanted it written when I was in school…with respect to the reader, easy to understand and filled with color charts and graphs to assist in the education. It uses basic financial concepts that have been proven effective over the years such as dollar-cost averaging, cash allocation, dividend re-investment as well as fundamental and technical analysis. Certain basic assumptions are made that can be adjusted according to the reader’s specific situation but here are the basic assumptions:
You invest 10% of your gross income each year (earn $50k, invest $5k)
Start at age 18 (can be adjusted)
Average gross annual income of $60k for the first 20 years and $80k for the second 20 years of our 40-year plan (can be adjusted)
Start off using broad market mutual funds until portfolio value reaches $25k
Switch to individual stocks after $25k
Set up specific guidelines for exiting a position that can be automated
Use an online stock screener using fundamental, technical, descriptive and common sense requirements for stock selection a few years after beginning to self-invest
Portfolio re-balancing annually
Given these parameters, here is what a retirement portfolio will look like after 40-years using conservative historical statistics:
Stock Investing For Students: 40-year plan
Using a savings calculator, conservative historical statistics and basic financial principles you can retire at age 58 with $1.8 million. The key is to start at a young age and use the power of compounding, the 8th wonder of the world. The techniques presented in the book are for everybody because they are user friendly and self-motivational as our youth watches their portfolio grow larger and larger as will their confidence and quality of life. This is my hope and my dream.
Here is the book’s table of contents:
Table of Contents
Acknowledgments
Introduction
About this book
1. Basics of Stock Investing
2. Fundamental Analysis
3. Technical Analysis
4. Portfolio Management
5. Exchange-Traded Funds (ETFs) and Mutual Funds
6. Game Plan
7. Executing a Stock Trade
8. Stock Splits
9. Tax Implications
10. Other Factors that Influence Stock Performance
11. Related Topics of Interest
12. Covered Call Writing- Using stock options to enhance returns
Appendix
I. Strategy outline
II. Online discount broker list
III. Long-term chart of S&P 500
IV. Stock selection summary
V- Game plan summary
VI. Master figure list of charts and graphs
VII. Plans for alternate time frames
Glossary
Index
About the Author
PRE-ORDER DISCOUNT:
Books will be available for shipment by the end of October. Use promo code: SISDISCOUNT to get an early order 10% discount @ checkout:
http://www.thebluecollarinvestor.com/stock-investing-for-students/
***PREMIUM MEMBERS HAVE BEEN EMAILED A SEPARATE PROMO CODE
Next live seminar:
Chicago: Saturday October 9, 2013
http://www.aaii.com/chapters/info?ChapterID=1
DePaul University Center
8th Floor
Room 8005
Market tone:
Now that the government is back open, the economic reports are beginning to get published and available for inspection:
According to the Labor Department, the US economy added 148,000 jobs in September, lower than the 160,000 expected
The unemployment rate declined to 7.2%, below the 7.3% anticipated and the lowest rate since November, 2008
11.3 million people still remain unemployed
Construction spending rose 0.6% in August to an annual rate of $915.1 billion, a 7.1% increase from one year ago and the highest level since April, 2009
The US trade deficit widened by 0.1% in August as exports slightly declined
Existing home sales decreased by 1.9% in September to an adjusted annual rate of 5.29 million from 5.39 million in August. Sales of previously-owned homes, however, are up 10.7% from a year ago
The median price of existing homes fell to $199,200 in September from $209,700 in August but is still 11.7% higher than a year ago
Factory orders of durable goods (A measure of the number of orders for a broad range of products—from computers and furniture to autos and defense aircraft—with an expected life of at least three years. Durable-goods orders are a leading indicator of industrial production and capital spending. Data fluctuate widely from month to month and are often subject to significant revision) rose by 3.7% in September from 0.2% in August, driven mainly by commercial aircraft orders
For the week, the S&P 500 rose by 0.9%, for a year-to-date return of 26%, including dividends.
Summary:
IBD: Confirmed uptrend
BCI: Moderately bullish favoring out-of-the-money strikes 3-to-2
Wishing you the best in investing,
Alan (alan@thebluecollarinvestor.com)
www.thebluecollarinvestor.com