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FIRE investing has been an emerging trend lately.
Here is everything you need to know about the Financial Independence Retire Early movement today...
Investing and options trading may seem like polar opposite, incompatible strategies.
But using options can actually be one of your savviest strategies for boosting retirement income.
We're in the middle of the worst global health crisis since 1918. That in turn has precipitated the worst economic crisis in 12 years, though it may very well prove to be worse than the decade-long Great Depression of 1929.
Unemployment is at record highs; Thursday's print of 1.877 million new claims was worse than expected, and would've been unthinkable as recently as Presidents Day.
The world is wracked by the worst geopolitical tension since the fall of the Soviet Union in 1991, and our cities are inflamed by the worst civil unrest since Martin Luther King, Jr., was assassinated in 1968.
And the markets are within sight of their February highs. The Nasdaq is up almost 8% for the year; the Dow Jones and S&P 500 are off just 8% and 4%, respectively.
And still the Nasdaq is up almost 8% for the year, while the Dow and the S&P 500 are down only about 8% and 4%.
The market is a big, complicated, discounting mechanism. In Business 101, we're taught stock prices reflect future earnings.
But, on balance, companies are not going to make 4% or 8% less than they would during good times. No, the drop in earnings for the second quarter of 2020 is going to be much, much steeper.
But if you listen to the news media, or investment banks' analyst desks, or to government officials, they'll repeat this old story about "future earnings" anyway.
Folks, this is probably the biggest Reality Gap in the country right now. It's the Reality Gap of the decade. And, as always, there are big profits to be had in that gap.
You see, stock markets are no longer about owning a share of a company's future earnings. It's no longer an arena where investors win by making the best long-term predictions, and traders win by predicting what investors will do next.
The truth is that the Big Four - News Media, Madison Ave, Big Government, and the Wall Street Heavyweights - have together turned stock markets into something else altogether.
The Big Four have turned rising markets into a good, much like tap water, public libraries, or electric utilities.
The markets are giving many investors fits, and I'm getting more than a few questions on retirement plans at the moment.
I'm hearing from a lot of folks who are scared to death they're going to lose everything, while others are simply fearful about what's next.
Either way, a little perspective can help.
Here's what you need to know.
The idea of retirement should be exciting.
You work for years and years, and eventually, you don't have to anymore. You can move to Europe with your spouse, spend your days going on hikes or relaxing by the beach, and finally shed off the stress of that nine-to-five.
Instead, the word "retirement" scares people. Everyone wants to retire, but not everyone is sure they can. The fact of the matter is that 22% of Americans have less than $5,000 in retirement savings - which simply isn't enough to live the retirement of your dreams.
Now, the financial news networks will use statistics like these to scare you. You've seen them - there are thousands of fear-inducing articles all over the Internet. They tell you you'll never retire, and then they'll give you a list of what they consider the best ways to save.
Sure, the suggestions these websites peddle aren't necessarily bad. But they aren't the best ways to save - not even close.
With times as "eventful" as these, it's understandable you may have missed a peculiar, oddly specific subgenre of news story making the rounds these days.
I'm talking about the "early retirement gone horribly wrong" story. It's related to, but distinct from, America's better-known retirement crisis.
Let me fill you in. Because even if you're not retiring early, or you feel like you're on track, this can happen to anyone.
So, the story goes something like this: A young person works hard, makes the right moves, and, in short order, banks enough to retire in their 30s. They walk away from the rat race to travel the world - whatever they want to do, really.
An American success story, right? Well... here's where the "gone horribly wrong" part comes in.
After all the time thinking they're on track, the retiree finds... they're bored. More often, and much, much worse, they discover they haven't invested anywhere near aggressively enough.
They start to run short of money, forced to scale back their big plans. These folks may even have to go back to work... if they can successfully explain the big gap in their resume.
I'm not sharing this with you to scare you - or depress you. I'm sharing this because... I just found a way out.
I caught a Tom Gentile Fast Fortune Club podcast this past Friday in which he talks about EXACTLY this problem and how making just a couple of trades can make the difference between a comfortable retirement and crushing disappointment. The podcast was for subscribers only, but I asked, and his team agreed to let me share it with everyone here today.
One of the biggest fears for people heading into retirement is making sure their money lasts as long as they do.
But a new report shows that fear is the new reality for most Americans.
There's a catch to America's lowest unemployment rate in 50 years - but it happens to be a trillion-dollar industry.
It's the Baby Boomer retirement wave.
There are actually several profitable investment strategies to take with a catalyst of this size, and smart investors have already jumped on a few of them.
A typical college student graduates with an average of $25,000 in debt and pays it off in 10 to 20 years.
Two and a half million Americans have debts of $100,000 or more.
Thousands are picking up Uber or waiting tables by night to help speed this up.
The median retirement savings for all Americans is a meager $5,000.
The sad truth is that countless Americans are well below the bar they need to meet in order to fully enjoy the best years of their life.
In 2019, the median income in the United States will likely top $60,336, while an American can, on average, expect to live well past their 78th birthday.
The official retirement age - the "kick-in" for full Social Security benefits - is now 66 years and two months. That's up to a maximum of $2,861; the estimated average monthly benefit is $1,461.
Lurking between the lines of these dry numbers are some frankly pretty shocking implications...
If you're among the 58% of Americans who have any retirement savings at all, you stand a very good chance of outliving your money by a considerable margin.
The grass doesn't look much greener on the other side. Forty-two percent of Americans haven't saved a nickel and are relying on a Social Security system that looks more and more like the Alamo each year to provide essentially all of their retirement income.
So retirement is a big problem right now, but the proposed solutions all seem to boil down to "invest earlier and save more." That's hardly helpful.
What will help - what could potentially bring the retirement crisis to an end for everyone - is to learn exactly how to make your money make you money.
The information I am about to share with you will make you absolutely livid.
What I'm going to explain to you today has already cost taxpayers in excess of $1 trillion over the past decade, according to the Center for Retirement Research at Boston College.
Now, that figure could double again...
... because of guaranteed pensions.
This is one of Wall Street's dirtiest, best-guarded secrets... but nobody ever talks about it outside the mahogany-lined hallways of their innermost sanctums.
They're the real reason why your local school district is cutting its budget, why there's never enough money to maintain our country's infrastructure, why healthcare costs so much, and why you're hit with one levy after another, year after year, to cover government "shortfalls."
The pension crisis is also single BIGGEST risk to the world's stock markets today and, yes, to your wealth.
Rolling Stone calls this... a scam of almost unmatchable cruelty.
Forbes says it's a... "national crisis" of unprecedented proportions.
Bloomberg says... the writing appears to be on the wall.
I know I'm going out on a limb.
Things appear good. The economy is stronger than it's been in decades. Unemployment is near 50-year lows. Wages are expanding. Spending is up. Earnings are excellent.
What I have to say will be hard to believe.
Investors are all too aware of how hard it is to make money in the stock market right now.
But we aren't going to let Money Morning readers accept these middling returns.
U.S. Inspector General audits found the Social Security Administration has underpaid tens of thousands of recipients.
And you might be one...