Lazy Man and Money

  • Blog
  • Home
  • About
    • What I’m Doing Now
  • Consumer Protection
    • Is Le-vel Thrive a Scam?
    • Is Jusuru a Scam?
    • Is Beachbody’s Shakeology a Scam?
    • Is “It Works” a Scam?
    • Is Neora (Nerium) a Scam?
    • Youngevity Scam?
    • Are DoTERRA Essential Oils a Scam?
    • Is Plexus a Scam?
    • Is Jeunesse a Scam?
    • Is Kangen Water a Scam?
    • ViSalus Scam Exposed!
    • Is AdvoCare a Scam?
  • Contact
  • Archive

How To Survive a Market Correction

July 7, 2014 by Lazy Man 2 Comments

Sometimes when I read a title or headline of an article in a financial magazine, I think about what I’d write if tasked to write the article. The August 2014 of Kiplinger’s Magazine has a title across the top that says, “How To Survive a Stock Market Downturn.”

My reaction was to write the second shortest article in the history of Lazy Man and Money (this is the shortest). It would consist of simply two words:

Diversify. Wait.

I was really hoping that Kiplinger’s made that the whole article. I think it would have gotten a good laugh and perhaps made some news for being a little weird (in a good way).

These two words work for many people. If you are properly diversified a market downturn will unlikely apply to your whole portfolio. Your real estate, bonds, and/or gold would likely not drop 10% at the same the S&P 500 does. If you wait for a recovery, you avoid panic selling that often leads to people buying high and selling low… which is the recipe for losing money.

The article’s advice itself was slightly different. It suggests that with the market reaching high, some are selling winners and holding the profits in cash. If/when the correction comes, this cash can be used to buy quality companies at a discount. There was also a suggestion to ignore the negative news and media and remember that markets typically rebound in after several months, which in small way amounts to my thought of simply “wait.”

It’s all very useful stuff. I recently sold nearly $8K of Apple stock that had appreciated very quickly over the last few months (I kept some as well). I’ve been looking for a place for this money, but now I’m thinking it’s best just to keep it in cash and use it when a buying opportunity arises.

P.S. I originally was going to go with “do nothing” instead of “wait”, but I couldn’t justify making the article 50% longer by adding an extra word.

Filed Under: Investing Tagged With: market correction, market downturn

Helping Parents Cope with Damage to their Retirement Nest Egg

February 11, 2009 by Lazy Man 6 Comments

The following is a guest post from Mr. GoTo, a baby boomer who blogs at Go To Retirement. On a personal note, I’ll be taking advantage of the “email this” button below and send it to my own mother. I hope you will join me and do the same. And don’t forget to subscribe to Mr. GoTo’s RSS feed here.

Do you have parents who are retired or who are baby boomers in the home stretch toward retirement? Like so many others, have your parents suffered significant damage to their retirement nest eggs? If so, you may not fully understand how that damage may have negatively impacted the mental and emotional outlook that your parents have toward their financial future.

Adult children can be a source of support and advice during this time. Compared to your parents, you may be optimistic because your investing horizon is much longer than that of your parents. You probably have greater emotional and mental resiliency that enables better coping skills. Your job is to carefully and lovingly apply those attributes in a way that can benefit your parents’ situation.

I am a baby boomer in the retirement home stretch. My retirement portfolio lost 21% last year and I am one of the lucky ones. Both of my parents are still alive. Fortunately, they are financially comfortable but worried nevertheless about their future.

Here are my suggestions for ways in which you can help your parents with retirement nest egg damage control.

  1. Gently encourage your parents to confront the damage. – You know they are thinking about it. You also suspect they may be stressing about it. Ignoring the problem is bad for their financial health. The stress is bad for their physical and mental health. How do you bring it up? My recommendation is to find a relatively private moment with your parents. Then choose that moment to openly talk about how the market downturn has affected you. That may prompt them to share their feelings. If not, ask them. After you have shared your story of market damage, just ask them how things have gone for them.
  2. Send your parents for a consultation with a fee-only planner. – If your parents are like most baby boomers and retirees, they are not receiving professional advice about retirement investing and planning. Now is the time to change that. You can help by making the arrangements and, if necessary, offer to pay for the consultation. Just be sure you do your due diligence on selecting a fee-only planner who is comfortable working with folks who are like your parents. To find a fee-only planner, check the and National Association of Personal Financial Advisors. Assure your parents that meeting with a financial planner is like meeting with a physician or other professional. They have a problem that needs fixing. The planner is the one who can provide a fix.
  3. Don’t let your parents turn to credit cards. – It should go without saying that adding debt to an existing financial problem is to be strongly discouraged. If you think your parents might be inclined in this direction, time for another preemptive strike. Talk about all of the credit card offers that keep arriving in your mailbox and how crazy that is considering what’s happening with our economy.
  4. Don’t let them take on excessive investment risk. – A natural reaction to suffering market losses is to move money into riskier investments. Sort of like doubling your bets in Vegas. I don’t recommend this strategy. Chasing the “next big thing” alternative investment is like rolling the dice. It’s time to get smarter about asset allocations, not take on more risk.
  5. Evaluate and adjust their retirement withdrawal rate. – If your parents are already retired and dependent on income from investments to live, encourage them to reconsider and decrease their withdrawal rate. This may require a spending reduction but that beats running out of money completely. I would encourage them to use one of the free financial planning tools and run some “what if” scenarios. A newer one that I have tried and seems to work well is Financial Fate. This is a downloadable (free) software tool. You may need to help your parents set it up and use it.
  6. Have them consider a fixed annuity. – If your parents are in a panic about having a sustainable income and still have retirement savings to provide that income, now may be a good time to have them consider other retirement income sources. A logical place to look is in immediate or deferred fixed annuities. To put this issue in front of them, send them a link to Immediate Annuities where it is very easy to run numbers on different annuity purchase and payout options. Although a fixed annuity may not be the perfect use of your parents’ money, if that guaranteed income relieves stress, it may be worth it.
  7. Suggest Downsizing – Lots of baby boomers and retirees have most of their net worth tied up into where they live. If that’s the case with your parents, it may be time to look at downsizing. When I say “downsize” I mean finding a place to live where your parents can free up equity to invest and lower their cost of living. Sometimes this requires a geographical re-location as well. For some, this is considered a desperate strategy but it shouldn’t be. Downsizing and relocating for affordability is logical and doable. A way to get this issue in front of your parents is to send them a link to Sperlings Best Places where there is an abundance of information comparing different areas of the country, including that all-important cost of living.
  8. Offer a private reverse mortgage – If your parents are really in bad shape financially and need help from family, one way to provide that help with dignity is through a private reverse mortgage. If your parents have equity in their house (or expect to grow equity over time), you can offer to buy that equity. I suggest that you agree on a total sum that you will lend your parents, to be paid out monthly or quarterly. Have a lawyer draw up a promissory note and first or second deed of trust that protects you. The note is paid off (with interest) when your parents sell the house. If you are taking risk because the loan amount exceeds the available equity, then the documents should provide that you share in any increase in value of the house, even if it exceeds principal and interest owed. This may sound too business-like but I think it will help you and your parents accept the entire relationship with less guilt and embarrassment.

I hope that your parents don’t need help following a disastrous 2008. If they do, I hope these tips will assist you in providing that help.

If you want to read about retirement planning and retirement living, come visit me at Go To Retirement or subscribe to my RSS feed.

Filed Under: Financial Planning Tagged With: baby boomers, market downturn, retirement home, retirement nest egg, retirement portfolio

Alternative Income Streams – November 2008

November 11, 2008 by Lazy Man 9 Comments

Due to my early retirement series (which seemed to go over like a lead balloon I think) last week, I’m late in delivering my alternative income report that I usually deliver the first of the month.

This month I saw a small downturn in advertising. Some forms of advertising are going away completely while other forms seem to be increasing. I think the advertising that is going away may be due to the market downturn. It also may be the changing advertising marketplace. Sometimes it’s hard to figure why it is happening, it’s just happening.

The forms of advertising that are increasing are ones that very popular bloggers have told me about for some time. Some examples of this are Google AdSense, advertising based on pageviews (generally referred to as CPM), and affiliate advertising.

Overall this adds up to a profit of $1870.21 for October… definitely disappointing considering this website hit a record 57,000 visitors and 85,000 page views for the month. I’m thinking of investing more in some of my other “non-Lazy Man branded” websites to make more. I’d give more details about them, but they are run under my real name and hence I have to keep a separation. That said, they really aren’t all that exciting – no world beating profits – just a dollar here and a dollar there.

I really need to focus more on Lazy Man and Health, which is barely running at any kind of profit.

Filed Under: Alternative Income Tagged With: advertising marketplace, affiliate advertising, cpm, market downturn, page views, profits

As Seen In…

Join and Follow

RSS Feed
RSS Feed

Follow Me on Pinterest

Search The Site

Recent Comments

  • Steveark on How Many Days of Financial Freedom do you Have?
  • Wesley on How Many Days of Financial Freedom do you Have?
  • Wesley on Should We Worry About the Debt Ceiling?
  • Lazy Man on Thiel’s Scandalous Roth IRA and What You Can Learn From It
  • Nancy Jones on Thiel’s Scandalous Roth IRA and What You Can Learn From It

Please note that we may have a financial relationship with the companies mentioned on this site. We frequently review products or services that we have been given access to for free. However, we do not accept compensation in any form in exchange for positive reviews, and the reviews found on this site represent the opinions of the author.


© Copyright 2006-2023 · Perfect Plan Publishing, Inc. · All Rights Reserved · Privacy Policy · A Narrow Bridge Media Design