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Goal vs. Market Focused

Over the last 30 years, the successful investors I’ve witnessed were relentlessly goal-focused.

The unsuccessful ones were anxiously market-focused.

There is a huge difference. 

When markets move quickly, as they have in droves over the last month, and the financial media creates more hysteria, it’s easy to lose sight of your Retirement Bucket goals.

In light of this, as we enter 2019 together, it’s a great idea to reaffirm what your top three goals are for your Retirement Bucket during this critical phase of your life: 

  1. First and foremost, to provide consistent short-term cash flow each and every month, as well as funds for cars, vacations, home improvement, and gifts to your extended family.  Aside from your good health, if you don’t have the necessary cash flow to do what you want, where you want, when you want, with whomever you choose to do it with, life is not as enjoyable as it deserves to be.

Withdrawing funds from your Retirement Bucket is challenging enough for those who have had the discipline to save and build over their working years like all of our Relaxing Retirement members.  Without a carefully thought out system, it can be even more psychologically challenging when you have to withdraw funds in the middle of a market correction. 

Knowing that you will experience volatility and corrections for the rest of your life, we strongly recommend holding several years’ worth of your pre-planned withdrawals outside of the daily volatility of your long-term equity holdings, and allowing your dividends to consistently replenish your money market liquidity.  This puts you in the enviable position of not having to panic and sell in a temporary down market cycle to provide for your scheduled withdrawals.   

  1. Second, long term growth to generate the increased cash flow you need each year in the future to keep pace with your rising lifestyle costs (inflation). Earning the long term, “real” investment rate of return you need to earn is not a bonus.  It’s an absolute necessity if you want to maintain the lifestyle you have worked so hard for. 

In stark contrast to stock picking, short term trading, and market timing, we strongly believe that your strategy for the rest of your Retirement Bucket be built on “capturing” the long-term historical premiums found in equities as a whole, and of specific asset classes.  This can be accomplished by strategically “owning” a cost-effective, globally diversified portfolio representing thousands of value driven, profit seeking companies in the United States and all over the world. 

  1. Finally, to be tax efficient, i.e. taking advantage of tax efficiency opportunities while still satisfying your cash flow needs and accomplishing your growth goals.

You deserve to experience all the benefits from successfully earning and saving, thus you have every right to legally reduce, and potentially eliminate, the amount of income taxes you are obligated to pay so that you may keep more of what you have earned. 

Staying on track with all three of these Retirement Bucket goals requires discipline, and a system and a structure, and that’s what our Relaxing Retirement Coaching Program was built to provide for you.

All of this is critically important to keep in the forefront of your mind when more and more financial media “noise” rears its ugly head the next time markets turn.