Posted October 15, 2021
By Zach Scheidt
This Is YOUR Alert... Responding to Your Rich Retirement Feedback
Friday is my favorite day of the week!
It’s not because it's the end of the work week. I love my day job of helping you find the best solutions to live a Rich Retirement.
I love Friday because most weeks we get to take the time to rip open the mailbag and respond to your feedback.
If you haven't written to me in a while, please don't be a stranger!
As a reminder, my email address is RichRetirementFeedback@StPaulResearch.com. And I read every single email sent to that address. (Yes, even the ones that aren't so flattering — you know who you are 🙂 )
It makes me smile each time I get a new email from our Rich Retirement Letter community. So I hope you'll send me your questions, comments, suggestions and even complaints.
We've got a few great emails I wanted to respond to this week so let's jump in!
Capitalism, Hard Work and Politicians
A few readers wrote in after my "Here's What Happens When You Kill Capitalism" article last week. Here's a response from Frank B.:
“Zach, [Capitalism] is a wonderful system! Unfortunately, it is maligned by politicians and the self-appointed elite and rarely, if ever understood by the public. It is not taught in school and the masses and politically astute blame it for all our ills. A ‘free lunch’ is what the vast majority are looking for. I have been around 76 years and have never found one. I find that the harder and smarter I work the more successful I become. I’ve taught my 6 children and 15 grandchildren how it works – both good and bad.
This nation became great and thrived because of it. It makes me sad to see what is happening to our great nation. As Churchill said - it is not the best, but it sure beats all the rest! Keep up the good work there is always hope!”
Good perspective, Frank. And you've had plenty of experience to build your opinion!
My mom had a phrase along the lines of what you said. She would always tell us, "There's no such thing as a free lunch!"
Of course that statement was usually followed up by instructions for chores that needed to be done. But I'm grateful because her perspective taught me to work hard and to take responsibility for providing for my own family.
Ultimately, this concept gives us the freedom to enjoy the things we've worked hard for. Because there's a sense of pride in sitting back and enjoying something special that you bought with money you worked hard to earn.
Your retirement should have a similar level of satisfaction. You've worked hard to get to this point in your career.
So I'd like to help you sit back and live a truly Rich Retirement, making the most of what you've worked hard to save.
"Giving Money to People Who Don't Work"
Long-time reader Larry Z. wrote in with some more feedback on the capitalism article.
“Hi Zach, Great to read your take on Capitalism. The only thing you had wrong was giving money to people who don’t work. I hate to say this to you, but you are not properly informed of all the facts in this issue. When one can make more money by taking advantage of the host of give-away programs that now exist than working, something is definitely wrong and we have disincentivized working.
There have been many studies now that have proven this is actually a fact. I feel for the kids but that kind of behavior just creates more people to exploit the system. Throwing money at problems is not the answer. Much much tougher scrutiny needs to be done on individuals that get taxpayer’s money.”
Thanks for your perspective, Larry.
I'm not sure I have the same black-and-white perspective as you on programs that support people who don't work.
Although I'm enough of a realist to understand there will always be people who take advantage of generosity. (And this is true whether the generosity comes from an individual or the government).
Here's a question for you (and anyone else who cares to discuss...)
What effect on our society — and the generosity of individuals — has our welfare system had?
I ask the question because I'm concerned that when it becomes the government's job to help those in need, it's all too easy for each of us to turn a blind eye to our neighbors who need help.
Instead some fall back on the idea of "I pay taxes to help that person" and we don't engage to help our fellow brother or sister.
Quite frankly, I hate the way the government (whether intentionally or not) has taken some of that personal responsibility away from each of us.
It would be better if we had a culture of generosity — which could go hand-in-hand with capitalism — where we feel a responsibility to personally help those in need.
It's a huge conversation that I could talk about for hours. And we don't have room for that in this alert. But I would love to hear your thoughts.
So for anyone interested in this topic, please send me an email and give me your perspective!
Several other readers also wrote in with responses to the article on capitalism. Please know I'm very thankful for your feedback and absolutely love hearing from you.
I hope you'll stay in touch!
Is It Too Late to Get Into My Stock?
Here's a question from Gary S. that’s similar to one many readers ask about various positions...
“I wanted to ask you about another stock. The ticker is SI. It has already made a big move. Is it too late to jump on? I know that chasing isn’t good most of the time. Thanks for any help.”
Thanks for the question, Gary.
I'll start by saying that I'm not registered to give personalized investment advice. Since I don't know the details of your financial situation, there's no way I could give you personal advice on what to do with your investments.
Anything I say here at Rich Retirement Letter is meant for a broad audience. So please keep that in mind.
Also, I'm not extremely familiar with Silvergate Cap Corp. (SI) other than knowing it’s a medium-sized regional bank.
I do like regional bank stocks right now because as interest rates rise, these banks should grow profits.
And we're still in the very early innings of a rising rate environment. So there could be huge growth ahead for small and mid-sized banks like SI.
When I've got a stock on my list that has run higher, I like to use the dollar-cost averaging strategy.
To do this, think about how much money you would like to invest in the stock and then divide that money into a few different pieces. So If you're interested in buying $5,000 worth of stock, break that $5k into five $1k pieces.
Then, you can use one piece each week (or maybe every two weeks) to buy shares.
This way, you'll get some shares right away. So if your stock moves sharply higher, you'll have some money already working for you.
But if shares pull back, you'll be able to use some of your money to buy at a cheaper price.
This means you'll get more shares from this second purchase if the price is cheaper.
That's the best feature of this approach. You get to buy more shares when the stock is cheaper and fewer shares when the stock is more expensive, helping to keep your average cost per share as low as possible.
Great question Gary!
That's about all the time we have for today. But please keep the emails coming and let me know what questions you have.
With the market becoming more turbulent, it's important to make wise decisions and not react emotionally. So if you have specific questions about what to do in today's market environment, those would be great topics for us to cover next week.
Here's to living a Rich Retirement!
Editor, Rich Retirement Letter