Increasing Net Worth

Posts on ways to reduce investment risk, how to hire a wealth manager or financial advisor, wealth building steps,  startup investing, small business investing, advanced investment strategies, alternative investing strategies to build wealth and make living off investments possible after retirement.

Financial Coaches Online

It used to be you could search for a financial coach online and you’d find a page with numerous independent financial coaches.  Then a funny thing happened. People and businesses discovered that services could be sold to people who were seeking financial coaches online because they either had money, or they were taking actions that …

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11 Ways to Reduce Investment Risk While Building Wealth

Do you worry about losing your money? If so, this isn’t necessarily all bad; worry can prompt you to make smart moves that lower investment risk when needed.   The following steps can all help reduce investment risk: increase the percentage of portfolio cash, diversify asset classes, buy undervalued assets, own noncorrelated investments, manage bond risk, …

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How Much Of My Net Worth Should Be in Cash (Liquid Net Worth, Cash Percentage)

Deciding how much of your net worth to keep in cash is a huge part of managing risk while building wealth, as well as contributing to a peaceful existence as an investor. The simple formula to figure how much of your net worth should be in cash is the amount you need to cover all …

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percentage sign

Types of Asset Allocation

Asset allocation refers to the percentages of investment capital put into the various types of investments. The goal with asset allocation is to achieve maximum return within an acceptable amount of risk. There are four major types of asset allocation: Constant weight asset allocation, strategic asset allocation, dynamic asset allocation, and tactical asset allocation. In …

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Man over 50 with cash

All Weather Portfolio Pros and Cons | ETFs | Performance | Chart | Videos

The All Weather Portfolio is has performed well during certain times in the past. By the end of this post, however, you’ll know why the All Weather Portfolio might work well for the extremely wealthy Dalio family for whom it was designed, and why it may not work so well for investors like you and …

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Scale Time Money | Difference Between Cash Flow and Capital Gains 

Difference Between Cash Flow and Capital Gains with Chart

There are two major reasons you invest; for cash flow or for capital gains. What’s the difference between cash flow and capital gains investing? Cash flow investing buys assets that generate income while capital gains investing buys assets with the expectation they will increase in value.   There are some important nuances with both cash …

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Pros and Cons of Using a Financial Advisor (with Cost Charts vs DIY)

  When feeling uncertain or overwhelmed about managing your investments, you may consider hiring a financial advisor. In this post I’ll share what I learned about the pros and cons of using a financial advisor after having hired and worked with multiple financial advisors over the years. The pros of using a financial advisor are …

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money pass computer | open in the money covered call strategy

In the Money Covered Call Strategy | Benefits and Examples

  Selling in the money covered calls can be an excellent income generating strategy for stock investors trying to live off investment income.  An in the money covered call strategy involves selling a call option with a strike price lower than the market value of the underlying stock. This strategy is commonly used when the call writer …

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Risk Reward | Start a Business or Invest in Stocks

Start a Business or Invest in Stocks: Which Is Better?

It can be challenging to choose the best opportunity to maximize your valuable time and capital. Is it better to start a business or invest in stocks? For the amount of capital required, starting a business has high income and capital gain potential yet requires far more time from the owner; investing in stocks has …

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What Goes Up When Stocks Go Down? 7 Hedging Assets

  Investing within acceptable risk is one of the most important things we can do as investors. Occasional bear stock markets challenge even advanced stock market investors when it comes to managing risk. After investing through several bear markets over the past 40 years, I’ve learned that one of the best ways to lower stock …

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economic and stock cycles

Are Individual Investors Wrong Most of the Time?

We investors, that is, are almost always wrong collectively about which direction the stock market will go. Here’s the holiday looking colorful chart (compliments of AAII) to support my points below: The AAII (American Association of Individual Investors, that’s most of us reading this:) reported that those expecting a rise in stocks over the next …

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asset allocation charts

Factors Affecting Asset Allocation

Asset allocation can be the driver of investment returns as well as the primary risk management component in an investment portfolio. Its importance, therefore, cannot be overstated. The factors affecting asset allocation are investor age, net worth, liquid assets, emergency fund, time frame, financial goals, risk tolerance, alternative investments, and investment correlation. As you will …

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strategic vs tactical investing differences

Strategic Vs Tactical Investing

Investors often wonder about the difference between strategic investment vs tactical investment strategies. Strategic investing is usually passive, or buy and hold, and follows a fixed asset allocation among different types of investments, while tactical investing makes investments in assets that appear to be better at any given time based on their return potential. What …

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How Wealth Is Made

Most people think of wealth as being made only from investing in the stock market. While many investors do successfully grow a stock portfolio over time, you’ll find that most high net worth investors make wealth in other ways. Wealth is commonly made from significant income increases, company bonuses, increases in the value of assets …

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Wealth Building Fundamentals Inspired by My Abundant Fig Harvest

  Last week as I picked an abundant fig harvest, I couldn’t help but think about how much my fig harvest parallels the wealth building fundamentals I’ve learned (many the hard way!) from investing in dozens of different assets and strategies over the past few decades as a personal investor.   These wealth building fundamentals are …

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What Are Defensive Investments?

It’s often said that managing risk is as important as getting good investment returns. Ownership of defensive investments can offset potential losses from other investments while smoothing out returns.  Treasury bonds, T bills, gold, money market funds, put options, TIPS, and inverse ETF’s are all examples of defensive investments. These are all assets that tend …

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Beginner To Advanced Investing Strategies | What’s Best for You?

Does everything you need to know about investing really fit onto one side of a cocktail napkin as touted by more than one wildly famous financial author?   Well, the answer depends on:  Your personal wealth plan How long you have to save and invest  Your net worth How much money you need to retire …

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Woman Lightbulb | Creative Income Streams

Creative Income Streams

Creative income streams have been the saving grace for my family. I think they can be for millions of retirees willing to think and act outside the box.   In this post I’ll share what I’ve learned after testing and implementing over 15 creative income streams from investing, consulting, online business and real estate along with my husband. …

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Woman cash | How to Make Money When Stocks Go Down

How to Make Money When Stocks Drop

There are simple ways to make money when stocks drop using more traditional investing methods and there are also more advanced strategies to make money when stocks drop. In this post, I will cover simple to slightly advanced strategies that both investors and many wealth managers use to make money in down markets for their …

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couple fulfilling their dreams through their stock market returns

Stock Market Return 2010 through 2019 and Why You Care

Stock market returns by decade are often used as markers for measuring past performance and estimating future performance more reliably for retirement planning purposes. And we all know that stock market gains can be excellent passive wealth builders in most decades, so let’s see what happened last decade, and how can we use that data …

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Piggybank Compare | Wealth Building Vs Income

Wealth Building Vs Income

Wealth building and income generation are the two primary investment objectives. As such, these factors are the starting point for selecting investments.   Is it better to focus on wealth building vs. income as a primary objective? Wealth building is typically the main objective until enough wealth has been accumulated to provide for a comfortable retirement. …

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money market vs stocks

How Much to Keep in Money Market Accounts | 15 Factors 

No one wants to run out of cash. By cash, I mean that super safe stash you keep in a money market account that won’t fluctuate in value the way stocks do.   But just how much should you keep in a money market account? It depends on some personal things like your investments, portfolio allocation, dependents, …

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Money Timer Flag | Alternative Wealth Solution

Alternative Wealth Solutions

Consistently saving money and investing it in stocks and bonds builds wealth over many years. The problem is that this strategy usually takes at least two decades, and most people don’t begin this discipline until it’s too late to save enough to retire comfortably.   Alternative wealth solutions exist, however, for anyone willing to think and invest outside the …

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Bear Chart | How to Prepare for Bear Markets

How to Prepare for Bear Markets | 11 Steps [Video, Chart]

Bear markets are a fact of life for stock market investors but they don’t have to be detrimental to your net worth.   After investing through several bear markets, both alone and with financial advisors, I’ll share how to prepare for bear markets.  While I’m an AFC® (Accredited Financial Counselor), I write from my own investing experience of 40 …

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Key Compass | Advanced Investment Strategies

Advanced Investment Strategies (You Won’t Hear from Your Advisor) | Video

Many investors have concerns about passive investing in stocks and bonds based on standard asset allocation models. Or maybe they have seen that passive investing won’t get the results they need to reach their financial goals. Many investors turn to more advanced investment strategies in an effort to increase returns without increasing risk.    Popular …

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couple toast

Fear of Retirement Boredom | 7 Cures [Videos]

For those planning to retire soon, retirement can feel scary from both a financial and a lifestyle perspective.  Fear of retirement boredom is a very legitimate reality, especially for certain personalities. Here are 7 ways to address that subtle and almost embarrassing fear that you could be bored to tears in retirement. Read my own …

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Bear vs Bull | Are Stocks Safe for Retirement?

Are Stocks Safe for Retirement? 8 Important Factors 

Every time I hear a retiree confidently tell me that they are invested in “safe stocks” so they’re not concerned about a bear market, I silently shudder.  Are stocks safe for retirement? It all depends on your risk tolerance, net worth, stock market valuations and other factors explained below.   After investing for almost 40 years …

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retirement key | Alternative Retirement Investment Strategies 

12 “Slightly” Alternative Retirement Investment Strategies 

  If you’re concerned that investing in traditional stocks and bonds with a common asset allocation won’t provide a comfortable retirement for life, you’re not alone. We had those same concerns over a decade ago, along with millions of other investors over 50, and here’s what we discovered: Alternative retirement investment strategies can result in higher …

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ten blocks | What Will Stocks Do Over the Next 10 Years

What Will Stocks Do Over the Next 10 Years?

Updated May 6, 2020 At the end of the strong bull market of the 1990’s, a few brave financial experts predicted the next decade would not be a good one for stock investors.  What will stocks do over the next 10 years? Ray Dalio, Warren Buffett, Rob Arnott, Liz Ann Sonders and John Bogle have told us what …

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risk blocks | reducing risk in stocks

Reducing Risk in Stocks | 13 Lessons from Past Bear Markets

After surviving a few bear markets over the past 40 years as an investor, I’ve learned many lessons from them.   Reducing risk in stocks before bear markets take full hold helps investors protect their net worth as well as have capital to invest in stocks again once unusually low valuations are reached.  This sounds almost too obvious to write, but most investors don’t take …

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couple pondering | Are Dividends or Capital Gains Better

Are Dividends or Capital Gains Better?

  You may have noticed that you’ve gotten both capital gains and dividends from investing. Or maybe you’re trying to decide if you should focus on dividends vs capital gains in selecting investments, leading you to wonder:    Are dividends or capital gains better? Dividends are better for investors seeking income as a primary objective …

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hands up

Stocks That Went Up in 2008 | Plus ETFs, Bonds, Gold

Toward the end of bull markets, it’s smart to see what stocks went up in past bear markets for recession proof investment ideas. While there have been some short and minor bear markets since 2008, the severe 2008 bear market continues to provide excellent data and investing lessons for everyone.  Stocks that went up in …

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How to Buy Assets That Generate Income

If you’re approaching retirement, that anticipated time when you can live off investments or at least work fewer hours own your schedule, you’re probably transitioning to income investing. You may be wondering how to buy assets that generate income. The way you buy income generating assets depends on the type of asset you’re buying. For example, …

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Problem - Solution

Problems with Covered Calls

Covered calls can be an excellent way to increase income from stocks but like all investments, covered calls aren’t perfect. The problems with covered calls include stock market risk, company specific risk, high required capital, forfeiting of potential capital gains, taxes on call income, and ongoing management of unexercised options. It is my belief, however, …

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retirement nestegg | Are covered calls a good strategy

Are Covered Calls a Good Strategy?

In this time of low dividend yields, increasing stock income by selling call options on stocks you already own sounds pretty appealing to yield hungry investors. Are covered calls a good strategy? Covered calls can be an excellent income strategy for stock investors willing to forego capital gains above the strike price should the call …

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how many income streams

How Many Income Streams Should You Have? [Videos]

The more income streams you have the better, right? This is not necessarily true. How many income streams should you have? It have depends on your goals, available time, types of income streams, available capital, taxes, demonstrated success, income reliability, and desired lifestyle. In this post I’ll share what I’ve learned in each of these …

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How to Increase Net Worth Before Retirement [Videos]

Most advice for how to increase net worth is geared toward investors with decades to save and compound wealth in the stock market. If you’re an investor over 50, it could be too late for that strategy before retirement. But you can increase net worth by taking advantage of cycles in stocks or real estate, …

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What Are the Risks of Bonds? Chart Stocks Vs Bonds

Updated August 8, 2019 Investing in bonds definitely has risks, contrary to what many investors think. Just what are the risk of bond investments? They include interest rate risk, default risk, inflation risk, call risk and economic risk. The fact that bonds are used to offset risk from stocks, and the very long bull market …

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Playing Catch Up Retirement Savings | 59 Uncommon Solutions [With Videos]

If you’re playing catch up retirement savings, here are 59 wealth building tips and solutions that can radically change late retirement planning. After personally making thousands of investments among stocks, bonds, funds, and real estate, both with and without financial advisors over the past 40 years, and creating alternative income streams  to replace career income …

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How to Avoid Problems When Hiring a Financial Advisor

If you’re thinking of hiring a financial advisor, you may be wondering what unexpected problems you might face after you start working with him.   Research shows some of the more common unforeseen problems after hiring a financial advisor come from higher than anticipated fees, poor customer service, lack of personalized service, poor investment track …

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How to Understand Your Investments (Investing 101, Lingo Free)

Investing can seem very complicated if you’re not familiar with all the financial lingo. If you’re wondering how to understand your investments, these 3 steps will get you well on your way. Your money is divided among into stocks, bonds and cash type investments based on your goals, desired risk and time frame. The stocks …

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Should You Manage Your Own Money (With Time and Cost Comparisons)

You may be at a point where you’re wondering if you should manage your own money or hire a financial advisor. After using several financial advisors, and also managing my own money over the years, I learned that there are some good reasons to invest yourself. This includes lower costs, alternative investing, overall returns and …

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Wealth Building After 50 (No Penny Pinching and a Bit of a Rant)

Most articles about wealth building after 50 have tips with a minimal impact on true financial independence. If you’re over 50 and far short of reaching your big retirement number, it’s time to take some serious steps beyond investing pocket change and cutting out lattes. While these aren’t bad ideas, they ’re not going to …

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How to Invest in Startups for Individuals

Imagine if you were one of the very first investors in Facebook, Apple or Uber. If this seems crazy,  remember that every company needs startup capital, and individual investors can now participate in startup funding easier than ever. Investing in startups for individuals now has many options, including online startup companies that match investors with …

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Investment Strategies A High Net Worth Advisor Uses To Lower Risk

Are you wondering what investment strategies you can use to lower your risk while increasing your returns? In this post, I’ll share five investment strategies that one of the top financial advisors uses to build wealth safely for his clients while also generating income. Many years ago, my dad taught me to investigate where and …

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