Monday, December 29, 2014
Top Tips From 2014
Marc Lichtenfeld, Chief Income Strategist, The Oxford Club
|  We've published a lot of great information here at Wealthy Retirement this year - all geared toward helping you attain and keep a more comfortable lifestyle in retirement. For my last column of the year (I will be on vacation the rest of this week), I thought I'd look back at the columns that resonated most with you and boil them down to the highlights. Think of it as the Cliffs Notes version of Wealthy Retirement.
Cutting Fees
In January, I wrote about how investors could eliminate $155,000 in investment fees over their lifetimes.
The idea is to invest in a self-directed 401(k). Roughly half of employers with 401(k) plans offer self-directed plans, although many people don't know about them. A self-directed 401(k) is just like a regular 401(k) plan except instead of being limited to the mutual funds that your human resources department chooses, you can invest in any stock or fund that you want.
The benefit is more flexibility and the opportunity to eliminate thousands of dollars in fees over your lifetime.
If you invest in Perpetual Dividend Raisers, stocks that raise their dividends every year, and do not actively trade the stocks, your fees will likely be less than $100 per year - probably way less. For example, if you bought 10 stocks, you might pay as little as $79.50 in commissions. A typical 401(k) costs an average of 1.5% per year in fees. So a $100,000 portfolio would cost you $1,500 versus $79.50. That can really add up and make a monumental difference in your nest egg.
The Best Thing You Can Do With Your Money?
In February, Steve McDonald outlined why bonds are the best thing you can do with your money. Now, Steve and I disagree on this point. I'm a stock guy, he's a bond guy. I think Perpetual Dividend Raisers are the best long-term investments. Steve says bonds are better. But we can still be friends.
More importantly, he went into detail about why he likes bonds so much and the math behind why they're an effective investment. A lot of readers appreciated the lesson.
Ignore Doom and Gloom
In April, I put out one of my favorite articles of the year, imploring readers to ignore the doom and gloom predictions. I talked about an argument I had with two people who were scared to invest because of geopolitical crises.
Assuming those two individuals sat out the market, they missed a 13% run-up in the S&P 500 since that column was published.
I showed how - throughout history - when things looked bleak from a current events standpoint, there was a lot of money to be made in the markets.
Long-term investing has worked for decades. Even horrific disasters, wars and catastrophes didn't change that.
"That There's an RV"
In July, Matthew Carr told readers about a simple economic indicator that few people ever talk about - RV sales.
A boost in RV sales, which Matthew called the most discretionary of all consumer spending, suggests strength in the economy. And it certainly played out this year. It has a very good track record as a leading indicator for predicting growth or recession. Sales were way up in the first half of 2014 and we've seen significant economic growth this year, including 5% GDP growth in the third quarter, the highest in 11 years.
Bonus points to anyone who knows what the above quote is from. Leave your answer in the comments section.
You Don't Have What It Takes
I've been a contrarian investor for years. I was trained by two of the best contrarian investors in recent decades. Lots of people call themselves contrarians, but few have the intestinal fortitude to buy when the whole world is selling.
In October, I discussed just what it takes to be a successful contrarian investor both long and short term with a few examples of how I went against the grain and made money for subscribers.
Safety Net
And of course my Safety Net columns, which run every Wednesday, remain hugely popular. Each week, I analyze the dividend safety of a stock suggested by Wealthy Retirement readers. Oil stocks have been hammered lately, making their already high yields sky-high. I've recently examined the dividend safety of well-liked stocks such as Seadrill (NYSE: SDRL) and Linn Energy (Nasdaq: LINE).
In fact, my Seadrill article generated a huge response. There were 185 comments left on the column where I call the Seadrill CEO a liar.
2015 and Beyond
We have some exciting things planned for Wealthy Retirement in 2015. I can't wait for you to see them.
If you have any thoughts on what you'd like to see in Wealthy Retirement next year, please leave your feedback in the comments section below.
I hope your 2015 is filled with much health, wealth and happiness. | | Recent Articles:
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- Lawrence L.
According to an ABC News report, people are becoming "millionaires overnight." It's happening in Kansas, Pennsylvania, Texas, Oklahoma... All over the country.
One man from a tiny town of 1,458 is now looking "to reap as much as $1 million per year."
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