Looking after your Investments
In this video:
00:29 – Managing your investments and retirement
01:02 – Retirement fund closes with zero gains
02:27 – 20 years of payments wasted
03:23 – Understand how to trade for yourself and look after your own future
04:30 – Made more trading FX this year than the retirement fund has made in 20 years
05:14 – Taking control of your finances
05:55 – Topics for future podcasts and videos
06:05 – US Elections approaching – be careful with your trade setups.
Should you rely on someone else to help with your long term investments in your retirement, or should you take care of that for yourself? Let's talk about that and more right now.
Hi Forex traders, Andrew Mitchem here, the owner of The Forex Trading Coach. Today, this is video and podcast number 201.
Managing your investments and retirement
I want to talk about something that affects all of us, when you think about your investments, when you think about longer term investments, when you think about retirement, how do you manage that?
Is it something that you just handover everything to someone else and say, “You're the experts, and I've got no idea what you're doing with my money or my investments, but go and do it for me.” Are you the sort of person who wants to take control of things for yourself and really understand what's happening, because after all, it's your money, and your investments. Which one are you?
Retirement fund closes with zero gains
The reason I want to talk about that is because of an experience I've had just today. Now, I flew to Tauranga, which is a beautiful part of New Zealand, today to see a client, who's just joined me. He's actually doing really, really well with his trading, just starting off small, but going very well.
Through our conversation this morning, he said to me, “Andrew, I've got a bit of a problem.” I said, “Okay, so feel free to share it if you wish to.” He said, “I've been investing,” and I'm not going to tell you the companies name, but it's a very well known retirement investment fund here in New Zealand. It's a global company for they have an office here, and he's been with them for 20 years, he's been paying money as a retirement fund into this company. I've just written and told him, now, I don't know the legalities with this, and it kind of doesn't quite add up, but this is what he's told me today. He said they've written to say, “You can take your money out now, but the money that you take out is only the money that you've put in over the last 20 years. No gains or anything like that.”
To do that, to have the privilege of taking his money out, they're going to charge him fee to do that, like an administration fee anyway, and that's quite a hefty fee. You think about that, money that he's paid in.
20 years of payments wasted
After tax money that is put into this retirement fund for 20 years that he's been working, he's going to get exactly the same amount of money out today than what he's put in over those 20 years. No increase in account, no gains, nothing like that. Of course, with inflation and everything else, we're going to have what you put in, $1000, 20 years ago is not going to buy you very much today in comparison.
Effectively, for 20 years he's put his money in, he's paid fees, he's done everything else, hoping that it's going to be his sort of nest egg for retirement, It's just not going to happen, it's completely out of his control. By everything they said to me today, he has little choice but to just take this money out. I suppose, like you were saying, the good thing is that at least he can get his money out, but it's not like he's got any gains or anything like that.
Understand how to trade for yourself and look after your own future
It got me thinking, and it got me sort of talking and discussing trading and Forex with him, and said, “Look, you know, yes you're on a small account today, but if you can understand how the market works, if you can make a percentage on that small account today, you have the ability to make that same percentage or more as your knowledge gets better, over any size trading and account. It's not like extra work is involved, it's not like you're working extra amount of hours to get extra amount of money.” In most traditional jobs, the only way you're going to get more money, if money is the object and the name of the game, is to either have a higher level job, potentially more stressful, certainly, probably a lot more hours or things like that.
The beauty is, we've discussed today with Forex Trading, is that it's, the important thing for him to grasp right now, is to continue doing well like he's doing. He's doing a great job and making some great returns. Keep doing that, prove to himself he can do that across various market conditions, and then build up from there.
Made more trading FX this year than the retirement fund has made in 20 years
To be honest, what he's already made so far this year, is more than that retirement fund was going to pay him in many years. Anyway, even if he remained with them and even if they honored his returns, which they haven't done anyway.
It just got me thinking about that, and I wanted to share that with you today, because everybody is affected by this. You have a real good think about what you want to do with your retirement fund. Are you happy just to hand those funds over to some company who sort of big multi-national company. You don't know what they're investing in, you don't know anything that's really, that's going on there. Would you want to take control of yourself, not only gain a great understanding of great market and knowledge about what's happening around the world, and things like that.
Taking control of your finances
But also you're taking control of what's going to happen with your retirement and your investment, your finances.
Think of a really important part of trading that a lot of people don't sort of grasp that importance. Everybody is out there on day one trying to make an absolutely fortune and double their account every month. It's pointless, get an understanding of doing it properly, doing it with low risk. If you can do that, you can look after your investments, your retirement et cetera, cash flow, all the benefits of trading, just by yourself. You've got the knowledge that you're doing this for yourself. Hope that helps.
Topics for future podcasts and videos
If you have any topics you'd like me to talk about on future videos and podcasts, just drop me a line, [email protected], and I'll be more than happy to discuss those with you.
Just be aware that now we are at the end of October, leading into early November. Of course, we've got the US elections coming up in about a week and a half. Expect the market to be either crazily volatile, or very, very quiet, leading up to that. It could be either, who knows what is going to happen leading up into that election, and probably for a little while after.
US Elections approaching – be careful with your trade setups.
Just take things a little bit carefully, reduce your risk, look for those A grade set ups. Anything is a little bit sort of dodgy, fifty-fifty. I don't mean dodgy like a bad set up, and anything that is not quite perfect, don't take it, just be real careful of the market conditions for the next couple of weeks or so. Look forward to talking to you this time next week, and I'll bring you more Forex Trading tips and information. This is Andrew Mitchem, The Forex Trading Coach. Have a great weekend, see you this time next week.