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You need a lifetime investments calendar
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Like clouds accumulating in a storm, your investments can grow and provide rain during a drought
You know what you need? You need a Lifetime Investments Calendar, that's what you need.
It's no good investing if you don't have some kind of motivation to do so. That motivation will provide you with the discipline you need to let your investments grow without cashing out prematurely.
One way to do this is to create your very own Lifetime Investments Calendar, which will guide you on your journey to financial magnificence.
Divide your chart into five-year segments, mapping out the future of your life. So if you're also in your twenties like me, then your chart would start with ages 31 to 35, and then move on to ages 36 to 40, and so on. For each segment, decide which one of your investments you would like to cash out on. It would be best if you started making all your investments right now, because the key to investing is time.
Here's an example:
Ages 31 to 35: Cash out certificate of deposit at an estimated $500 gain
Ages 36 to 40: Cash out conservative mutual fund at an estimated $2,000 gain
Ages 41 to 45: Cash out risky mutual fund at an estimated $5,000 gain
Ages 46 to 50: Sell property at an estimated $10,000 gain
Ages 51 to 55: Cash out Roth IRA at an estimated $60,000 gain
Ages 56 to 60: Begin receiving annuities of Traditional IRA at $1,000 per month
You don't necessarily need to cash out of your investments every couple of years. Personally, I want to, but that's because I want to enjoy my money throughout my lifetime. It's all about the priorities in your life.
Yes, I could start depositing $250 per month into some Roth IRA (starting at age 30) and cash out with $1 million when I turn 80. But why would I want $1 million when I'm 80? I can't buy awesome videogames because of the arthritis in my hands. I can't eat the best steak in town if I've lost my sense of taste. Can't buy flashy clothes if my stomach is hanging over my knees.
It's all about priorities. Maybe you'll want to buy a home when you're 54. With your Roth IRA cashout, you can definitely drop a hefty down payment. Maybe you want to put your child through college; selling some property at age 47 could help you to do just that.
So make yourself a Lifetime Investments Calendar, and figure out where your priorities fit in. And while there's something to be said about being a millionaire octogenarian, it's also worth noting that life is short and can be full of unexpected events, so maybe enjoying some of that money sooner as opposed to later might help give you a happier life.
For me, I prefer the plan of starting now with a multitude of investments, and cashing them out slowly over time. And always keeping another one growing in the sidelines, just waiting to meet me in the future.
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