Yes indeed, who else wants to have MILLIONS of dollars to play with by investing in the stock market?

After all, today we set a record for foreclosures, the economy has the most unemployed in two decades and there is absolutely no good news in the world of money and business.

BUT WAIT: My Citibank which i bought four weeks ago, has DOUBLED in price. Yes it has. The idea behind buying Citibank at $2 was that it is now owned in part by the government and because the government runs the show, it is a fairly logical short term play.

And guess what?

I WISH I would have bought 1000 times as many shares as I bought.
Had the stock gone down to $1 instead of up to $4 I would “wish” today that I had not purchased the stock in the first place.

OK: The reality is that you are not going to earn millions from the stock market.
You aren’t going to earn enough to retire on (unless you plan on retirning a year or two and then passing away).
Your friends, colleagues and various advisors will not accomplish these well publicized goals either.

Want proof?

Ask WHOEVER wants to control your money to SHOW YOU their PERSONAL RETIREMENT PORTFOLIO.

Fact 1) They are broke. That means they have less than $100,000 stashed if they are under 50 years old. And that means they have saved less than $3000 per working year of their life. I’m not going to say they are idiots…just that they believed their various companies nonsense.

FACT: If your financial planner/buddy/uncle who is a “really smart investor” can’t show you $200,000 stashed between age 50 and 60 (now you’re up to 4 whopping years of retirement income) and he can’t, he isn’t the right person to be listening to either.

YOU WANT TO HAVE THE GUY WHO HAS EARNED $50,000 per YEAR in his portfolios and last year he didn’t lose money because he was smart enough to stay OUT of the market when it was insanely expensive.
RIGHT?

This is pretty common sense, kindergarten simple right?

People often save 2-8% in their retirement accounts at the office. How’s that working so far? It doesn’t work. Don’t even wait for the next paragraph.

My Mom used to tell me to save at LEAST 10% of my income each year. (She was a wonderful human being, passed away almost 11 years ago and was in debt.) Most people don’t do that…save 10%, but I’ll tell you if you would have listend to my Mom you’d only have about 5 years of retirement income stashed, which is ok if you retire at 65 and die at 70.

But people love to gamble especially when it’s called “investing.”

The game goes like this: Gamblers like me who love to play Poker and Blackjack and trade stocks for fun, win or lose we know one thing: We are gamblers.

Gambling becomes dangerous when you play with TOO MUCH MONEY in proportion to your income. My rule of thumb is that I get 10% of my income per year to PLAY with. That means trade stocks, play blackjack, etc. etc.

That’s the same as some people going to the movies (expensive movies), traveling, etc.

However DENIAL is what happens when the gambler tells you “I will win.”

There is NO WAY any intelligent scientific gambler can tell you he will “win.” It’s all statistics, probabilities, percentages and FUN because you will end up with less than you started.

Now, take a look at your retirement “portfolio.” I have a “retirement portfolio” which I gamble with….I’m sorry…invest with.

See your “portfolio” is PRECISELY what is known as a bankroll to a blackjack player.

A bankroll is what you will play with. Double your money, you put everything in your pocket and play one last hand. Win? Keep going at the same unit. Lose your bankroll? Go see a show or go to dinner or go to the pool or go to the Playboy Club.

“Investing?”

Same thing. you take 10% of your income and HAVE FUN. Win, lose or draw you become more knowledgeable about the world you live in and misspell the world knowledgeable probably….

You become a wiser person realizing there is NO FREE MONEY THAT IS NOT EARNED.

So if you make $100,000 this year, take 10% and write it off. Put it in an account called retirement and go have fun. Buy, hold, sell, trade. Whatever. LEARN.

Here are the lessons: That $10,000 will grow to become next to nothing more than $10,000 whether you put it in the stock market, bond market, treasury bonds or pretty much anything.

20 years @ $10,000 is $200,000. Adjusted for inflation and take out all the costs of the company running the retirement plan and TAXES when you TAKE THE MONEY OUT and you have four years of income. Maybe 5 if you live on the cheap.

THERE”S NOTHING WRONG WITH THAT.

But the illusion of earning 10% on 10% and having it grow into a mountain of money is the same as believing that God is a slot machine and reaps green on those he loves….

…the same as believing there is such a thing as PUSH BUTTON MONEY.

Can criminals turn pennies into dollars?

You bet.

BUT

They play a risk game in addition to a money game.

IF they get caught, they go to jail and don’t get to play the game any more.

Your FUTURE is secured not by the hopeful “growth” of your investments, but by THE SAVINGS from your EFFORT.

The nearest thing to push button money is getting money while you sleep.

How do you do that?

You set up systems that allow you to get paid more than once for the things you do.

Write a book. Sell 100 copies today, you get 100.00. Sell 50 copies in Turkey tomorrow and you wake up with $30 in your email.

There are a number of legitimate ways to LEVERAGE KNOWLEDGE and EFFORT and turn it into your SECURITY.

Have fun in the markets. They are fascinating. You follow, you play, you enjoy, but you secure your life with money you do NOT GAMBLE (and gamble = invest). THAT is the money that will take care of you for the rest of your life. This money comes from money you SAVE (Saving is not gambling/investing) and money you earn while you sleep… the money you EARN and because of the VALUE you generate you replicate yourself and get paid over and over for having done something once.

Make sense?

Counterargument?

Happy to listen to them all. One requirement: What is the balance in the 401 k/IRA accounts.

The market was up today again on the worst news of the year.

It never ceases to amaze or be fascinating!

YOU are YOUR FUTURE.

BET ON YOU.

DON’T BE ON CHEVRON (though Chevron is a good company for the long haul…for say 2% over inflation per year)

BET ON YOU.