I read this article and feel that these points are important to share. These are points that I agree with and try to get my client to follow. Mr. Buffett shares 3 specifics to avoid so you have a good retirement.
1. Speculating instead of investing
Some investors fail to recognize the difference between a speculative asset and an investment-worthy asset. According to Buffett, the difference is in how the asset generates a return.
“All investment is, is laying out some money now to get more money back in the future,” Buffett once explained. “Now, there’s two ways of looking at getting the money back. One is from what the asset itself will produce. That’s investment. [The other] is from what somebody else will pay you for it later on, irrespective of what the asset produces. And I call that speculation.”
2. Trying to time the market
Market timing is deceptively tempting. Investors often convince themselves they can wait for the right time to buy or sell a stock. However, experienced investors understand that market cycles are unpredictable, so staying invested for longer is typically the best approach.
3. Overpaying
During market bubbles and speculative manias, investors run the risk of overpaying for assets. This can be detrimental for returns.

“No matter how wonderful a business it is, there always is a risk that you will pay a price [and] that it will take a few years for the business to catch up with the stock,”

Moneywise interview 9/10/24

Disclosures:http://www.hechteffect.net/?page_id=31

I have saved six months’ worth of expenses in an emergency fund, but inflation is eroding its value. Should I invest part of my emergency fund in something higher-yielding, like bonds or a high-yield savings account?

Emergency money needs to stay liquid; these are funds you almost have to ignore because they are for an emergency. I understand that it is hard in today’s environment to see what inflation has done to our savings. There are a number of money market accounts that will pay more than savings accounts, which might be an option. My rule is, any money you might potentially need in 18 months or less, needs to stay liquid, regardless of the yield.

Discolsures:http://www.hechteffect.net/?page_id=31

In 2024, you can cash out as much as $1,000 from a traditional 401(k) or IRA to cover an urgent need. And here’s a big change: You get to define what counts as an emergency.
But there are rules, here they are:
You can make one withdrawal per year.
◾ You can’t take out more than $1,000.
◾ You can’t make an emergency withdrawal that brings your account balance below $1,000.
Remember, if you withdraw from a your 401(k) prior to age 59.5, you will pay a 10% penalty.
Please think twice before taking advantage of this new rule, you only have so much time to save for your retirement.
Need to borrow from your 401(k)? Now you can decide what is an emergency.

In 2024, you can cash out as much as $1,000 from a traditional 401(k) or IRA to cover an urgent need. And here’s a big change: You get to define what counts as an emergency.
But there are rules, here they are:
You can make one withdrawal per year.
◾ You can’t take out more than $1,000.
◾ You can’t make an emergency withdrawal that brings your account balance below $1,000.
Remember, if you withdraw from a your 401(k) prior to age 59.5, you will pay a 10% penalty.
Please think twice before taking advantage of this new rule, you only have so much time to save for your retirement.

*USA Today is the source for this information 8/14/24

Disclosures:http://www.hechteffect.net/?page_id=31

Many times, when I am meeting with new people in my office, they pull out their phone to open their financial accounts. They may be logging into the company 401(k), their brokerage account, or their bank accounts. I always ask them if they have a VPN on their phone, their common reply is “what is that”?
A VPN, which stands for virtual private network, protects its users by encrypting their data and masking their IP addresses. This hides their browsing activity, identity, and location, allowing for greater privacy and autonomy.
I cannot stress enough how important it is to have this on all of your devices. Most people are keeping their financial data on their phone or iPad without protection. Thieves are getting very sophisticated at skimming information. This is an effortless way to protect your financial data – do it!

Disclosures

Should I own gold? We have all seen and heard the commercials about buying gold, how it is the standard and gives protection and peace of mind, at least that is what they say in the commercials. What they are selling is actual gold pieces. If you are going to own gold in this manner, here are a few things to look out for.

How pure is the gold? The higher the purity, the higher the price.
What is the markup to the vendor? Often it is quite high.
How are you going to be able to use the gold? If Armageddon happens, are you going to trade a gold coin that cost you $2400 for a bag of groceries?

I believe in diversification and gold can be a hedge against traditional stocks and bonds. If you want to add gold to your portfolio, please look for a quality mutual fund or ETF that invests in gold.
The views and opinions expressed are for informational and educational purposes only as of the date of writing and may change at any time based on market or other conditions and may not come to pass. This material is not intended to be relied upon as investment advice or recommendations, does not constitute a solicitation to buy or sell securities and should not be considered specific legal, investment or tax advice. The information provided does not take into account the specific objectives, financial situation, or particular needs of any specific person. All investments carry a certain degree of risk and there is no assurance that an investment will provide positive performance over any period of time. The information and data contained herein was obtained from sources we believe to be reliable but it has not been independently verified. Past performance is no guarantee of future results.
Disclosures:http://www.hechteffect.net/?page_id=31

I am generally in favor of the bird in your hand, with 401(k) accounts, this means Traditional, pre-tax contributions. If you save as much as you comfortably can pre-tax, less will go to the IRS, and there is little change in your spendable income. You are putting the funds in your retirement pocket vs. that of the IRS. Roth 401(k) contributions are made with after-tax dollars and currently accumulate tax=free as long as the funds are on deposit for 5 years or more.
Over the past 3 years there has been a lot of talk about changing the Roth accounts because our Government feels too many people are accumulating too much money that will never be taxed. There have not been any negative statements made in regard to the Traditional pre-tax deposits, until now. Our Government is stating that only “well-healed” individuals have access to these types of accounts, and they are adding too much to these non-taxed deposits. If the amount that can be contributed is lowered, more money can go toward Social Security, thus helping that system.*
I do not know, I thought retirement savings were meant to help us all prepare for our own retirement.
*USAToday 3/21/24

Disclosures:http://www.hechteffect.net/?page_id=31

Most people do not get paper statements for their bank and credit card accounts anymore. When we got monthly statements, we took a few minutes to review them, now that most accounts are paperless, how often do you check yours?
I make it a habit to pull up my accounts to review the transactions at least twice a month. Recently, there was a report that people that use Amazon Prime were having their accounts hacked. When I looked at my credit card statement after reading that, I was charged for an Uber ride, I do not have an Uber account. I called my credit card company and reported the charge. They refunded and closed that account, I had to wait about a week to get a new card.
Because I have more than one credit card, I was not left unable to charge items, and because I regularly review my accounts, this was the only fraudulent charge processed. Please, review all your statements regularly so nothing slips through, and you do not lose money.

Disclosures:http://www.hechteffect.net/?page_id=31

This is a question I ask all my clients when they are contemplating retirement. If they cannot start rattling off things they want to do, I tell them they are not ready to retire.

We take a lot of time and discipline preparing to retire by saving into our retirement plans, paying off debts, and making sure health care is taken care of. Many people do not think about all the time they will have on their hands for (hopefully) decades to fill. I can suggest a number of activities to my clients, but they must know what they want to do.

I have seen too many times where people have retired not knowing what to do with themselves. They end up spending a lot of money on a lot of nothing, they end up gaining a lot of weight, or they end up divorced. I do not want that to happen to you.

As you are planning so carefully for the financial side of your retirement, please take a lot of time to think about the time you will have on your hands and what to do with it.

My husband has been retired for about 15 years. Between stuff he wants to do, and stuff he has to do, he wonders how he ever had time to work. That is a successful retirement.

Disclosures:http://www.hechteffect.net/?page_id=31

I was reading Consumer Reports, and they have some great financial tips to start working on now to make your financial life better.
Take Advantage of ‘529 Day’
The College Savings Plan has embraced May 29th as the day to look at funding college for your kids or grandkids.
Review Recurring Charges
We all sign up for different services such as streaming channels and subscriptions that we may no longer be using or like. Review these charges to see if you can drop any and save some money.
Review your retirement savings
Are you contributing all that you can to your 401k or 403b? More pre-tax contributions mean less in tax but may not mean less in spendable income. If you paid more in tax last year, this is one way to keep more in your pocket.

Disclosures:http://www.hechteffect.net/?page_id=31

Four million Baby Boomers will turn 65 in 2024 — the largest number in U.S. history.
People 65 and older take prescribed medications more frequently than any other U.S. age group, I take four medications.
Most major grocery store chains offer senior discount days, and tons of restaurants offer early bird specials for older adults. Amtrack offers a 10% discount for those age 65 and older.
When you get carded now, it’s so you can save money, not to deny you a purchase.
I have both been in business and with my Husband for the last 40 of my 65 years, neither seem to be that long.
65 looked much older on my past generations than it does now.
Even though I am now 65, my family still has to put up with me acting like a 12 year old!

Disclosures:Four million Baby Boomers will turn 65 in 2024 — the largest number in U.S. history.
People 65 and older take prescribed medications more frequently than any other U.S. age group, I take four medications.
Most major grocery store chains offer senior discount days, and tons of restaurants offer early bird specials for older adults. Amtrack offers a 10% discount for those age 65 and older.
When you get carded now, it’s so you can save money, not to deny you a purchase.
I have both been in business and with my Husband for the last 40 of my 65 years, neither seem to be that long.
65 looked much older on my past generations than it does now.
Even though I am now 65, my family still has to put up with me acting like a 12 year old!