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Dreams, Goals and then...reality
Old 06-21-2008, 11:20 PM   #1
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Dreams, Goals and then...reality

Hello everyone!

Tomcat98 recommended this forum as a way to generate new ideas on the many thoughts, ideas and methodologies everyone here used or is using to achieve their retirement goals.

I recently turned 44 and retired from the Army in 2003. After retirement, I earned a Bachelor of Science in Business & Management using voc rehab (I’m 50% disabled) and recently finished my MBA using student loans. I'm married with 3 children; my oldest and middle sons are both freshmen in community college with aspirations of becoming an Oral Surgeon and an Engineer. My youngest daughter will be a senior in high school this year and desires to become an MD (Pediatrician). Needless to say, a retired E-6 fresh out of college will not be able to help his kids very much with college. We were for most of my career, struggling to make ends meet until my wife and I decided our kids were old enough for her to begin working and contribute a second income to the household. In doing so, we were finally able to afford a house instead of renting or living on post.

Currently, we are investing in the FOREX market using expert advisors on the Metatrader 4 platform which earns approx. $150 a week (and growing) on a $5K investment in the EURUSD market. In the next few months, I intend on adding another $5K in the USDJPN market (after testing this market) and turn them both loose. It is my hope that after some time (2-3 years), this investment should begin to grow exponentially. Add to this my wife’s max contributions to her 401K is all we have.

Besides my house and student loan, I have very little credit card debt with a preference towards paying cash for everything (rewards credit card payed off monthly). My cars are paid for…one cannot beat a paid for car and intend on driving them both at least another 2-4 years with a new car phase in for my wife to replace her van and a rebuild on my sport car. I'm co-signed on two loans for my boys to help them establish credit as well as help them learn how to manage money instead of the national trend of trying to live like our parents and in doing so, incur huge credit liability.

My primary concern is with the injuries I sustained in the military (low back and neck), I fear that I only have another 4-8 years of being able to work. In order to walk and just generally function without pain, I have to take narcotics several times a day. As such, I have to create whatever opportunities I can right now that will have the capability of sustaining us indefinitely and am not afraid to use leverage to achieve this as long as I can mitigate risk. So my goal is not to retire early with the intent of enjoying life, but more as a means to generate income when I can no longer work.

I look forward to reading the many conversations on investment philosophies in order to generate ideas to add to my beginning investment portfolio.

Best regards,

Terry L. Robinson
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Old 06-22-2008, 11:07 AM   #2
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Welcome Terry. Thank you for your service to our country.

I'm sure someone much more knowledgeable will be along soon to comment on your FOREX trading. The little I have heard is that it is extremely volatile and that, particularly with the enormous leverage, it is easy to get wiped out. With what you have described as a modest nest egg, it seems overly risky to me.

I personally take a more modest approach to hedging against the dollar by purchasing CD's denominated in foreign currencies. The interest on the CD provides a downside cushion. The Brazilian Real has been very good to me over the past year. I have also concentrated on buying stocks whose earnings are primarily in other currencies.
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Old 06-22-2008, 11:56 PM   #3
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Welcome to the board, Terry.

Your experience perhaps makes you one of the board's experts on VA benefits.

Typically, when an investor mentions only something like FOREX investments, it sends up little warning flags in everybody's minds because very few of this board's posters have experienced positive "exponential" growth of that asset class. (There's been plenty of "negative exponential growth"!) It's probably not that difficult to predict the direction of the dollar but there are other asset classes to exploit that in a less volatile manner.

Hopefully the FOREX is a minor portion of a diversified asset allocation. But then the pension/disability also give you an opportunity to put your portfolio way out there on the risk/reward curve!
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Old 06-26-2008, 04:34 PM   #4
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Hello TankCommander and welcome to the group! I completed that task in La La land and am now home for good.

Quote:
Originally Posted by TankCommander View Post
Hello everyone!

Needless to say, a retired E-6 fresh out of college will not be able to help his kids very much with college. We were for most of my career, struggling to make ends meet until my wife and I decided our kids were old enough for her to begin working and contribute a second income to the household. In doing so, we were finally able to afford a house instead of renting or living on post.
I bet you have helped your kids more than you realize by them watching you and your wife's example of how you value your family. You can certainly help kids without financial support so don't sell yourself short.

Quote:
It is my hope that after some time (2-3 years), this investment should begin to grow exponentially. Add to this my wife’s max contributions to her 401K is all we have.
So are you rolling he dice on this FOREX trying to build capital for a nest egg?

Quote:
Besides my house and student loan, I have very little credit card debt with a preference towards paying cash for everything (rewards credit card payed off monthly).
Sounds good. Are your working on paying these off early or just letting them stay on the normal pay off schedule?

Quote:
My primary concern is with the injuries I sustained in the military (low back and neck), I fear that I only have another 4-8 years of being able to work. In order to walk and just generally function without pain, I have to take narcotics several times a day. As such, I have to create whatever opportunities I can right now that will have the capability of sustaining us indefinitely and am not afraid to use leverage to achieve this as long as I can mitigate risk.
Roger that. Get it while the getting is good but try balance it with your health issues and you might get more longevity than you think. As for the risk make sure you keep and eye on your parameters so you don't get wiped out. Not an expert at all on this type of trading but maybe someone here has some experience.

Quote:
So my goal is not to retire early with the intent of enjoying life, but more as a means to generate income when I can no longer work.
Not sure I understand this comment. What are you thinking about to generate income when you can no longer work?

Tomcat98
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Old 06-26-2008, 08:33 PM   #5
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[quote=Nords;673350]Welcome to the board, Terry.


PHP Code:
Your experience perhaps makes you one of the board's experts on VA benefits. 

Not as much as you would think, between my wife and I as well as talking with other disabled vets we've been able to work our way through the system.

Code:
Typically, when an investor mentions only something like FOREX investments, it sends up little warning flags in everybody's minds because very few of this board's posters have experienced positive "exponential" growth of that asset class. (There's been plenty of "negative exponential growth"!) It's probably not that difficult to predict the direction of the dollar but there are other asset classes to exploit that in a less volatile manner.
What makes me think it could after some time go "exponential" is because I'm using an "Expert Advisor" which is essentially a robot that makes trades based on the robots design & investment philosophy to include determing "Take Profit" and "Stop Loss" set points. Back this up with trailing stops and the robots ability to modify the order on the fly based on what the market is doing makes this a formidble investment strategy.

PHP Code:
Hopefully the FOREX is a minor portion of a diversified asset allocationBut then the pension/disability also give you an opportunity to put your portfolio way out there on the risk/reward curve
At this point, it is a major portion but as I cruise this board, I anticipate learning about other strategies to help me divesify.
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Old 06-26-2008, 08:57 PM   #6
Confused about dryer sheets
 
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Hello TankCommander and welcome to the group! I completed that task in La La land and am now home for good.
Thats just great! Now you should be able to totally focus on your family without divided attention.


Quote:
I bet you have helped your kids more than you realize by them watching you and your wife's example of how you value your family. You can certainly help kids without financial support so don't sell yourself short.
Agreed, my passion to succeed has influenced my kids so much that they understand that a good education coupled with critical thinking skills will help them. I'm pleased they are listening to my wife and I as well as seeking our opinion. Not something that their generation normally does.

Quote:
So are you rolling he dice on this FOREX trying to build capital for a nest egg?
Not so much rollling the dice as calculated risk backed up with a good testing methodology, but yes, this will be one "stream" of income to compliment my retirement. Would also like to take advantage of the housing market to create another stream of rental income as well as allowing the renters to build equity for me.


Quote:
Sounds good. Are your working on paying these off early or just letting them stay on the normal pay off schedule?
My wife recently suggested we should set ourselves up on a bi-monthly payment schedule which should gain an extra payment a year. I understand this could reduce the loan anywhere from 5-8 years but will need to run an amortization schedule to confirm then run a cost/benefit analysis before deciding this as well as determining if this 'fits' with some assumptions on what the economy is doing and our financial situation.
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Old 06-26-2008, 10:27 PM   #7
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I've learned a lot about FOREX myself and learned enough that it wasn't for me. It takes time or you run bots... and it works until it doesn't. When you're going through a retail channel then the pip spread hurts. And, like I said, it works until it doesn't. It'd be easy to say that betting USD against the Euro on the spot market for the last few years would be a no-brainer, until the Fed wakes up and decides that it's time to do something about the dollar... then all of a sudden a brilliant strategy isn't so much a strategy or brilliant any more.

I have one book I'd strongly recommend on FOREX... It's going to take some digging though.

As long as one understands the potential risks and exposure, I think FOREX could be a lot of fun. I think a lot of people that have bought into systems without understanding the underlying mechanisms are going to wake up rather sad and poor one day. The best way to offset that, and it sounds like you're on-board, is by not betting the whole egg basket.
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Old 06-27-2008, 06:23 AM   #8
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Originally Posted by TankCommander View Post


My wife recently suggested we should set ourselves up on a bi-monthly payment schedule which should gain an extra payment a year. I understand this could reduce the loan anywhere from 5-8 years but will need to run an amortization schedule to confirm then run a cost/benefit analysis before deciding this as well as determining if this 'fits' with some assumptions on what the economy is doing and our financial situation.
The math will hold throught that it will cut a 30 yr mortgage to about 22 yrs. Of course you could just pay 1/12 of a payment extra each month with your mortgage and that will basically do the same thing and you want feel those two times of a year when you are paying 1 1/2 months worth of a mortgage.

Assuming paying off early fits withing your assumptions not having a house payment would certainly make living off your retirement a little easier. You could always keep paying down and if the time ever comes when you need to scale back work restructure your remaining balance to ease cash flow assuming the numbers work out.

Tomcat98
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Old 06-27-2008, 11:58 AM   #9
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Originally Posted by TankCommander View Post
My wife recently suggested we should set ourselves up on a bi-monthly payment schedule which should gain an extra payment a year. I understand this could reduce the loan anywhere from 5-8 years but will need to run an amortization schedule to confirm then run a cost/benefit analysis before deciding this as well as determining if this 'fits' with some assumptions on what the economy is doing and our financial situation.
Works fine; they're fairly common now and you can do your own vice paying a service (or your mortgagor) for the privilege.

http://www.early-retirement.org/foru...ney-30644.html
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