Is it Possible to Build Your Own Annuity?

Is it possible to build your own annuity?

In short Yes  it is possible to create a portfolio that will in part mimic an annuity.

Cash From Your Own Annuity

How I would build an annuity.

How do you go about building an annuity like portfolio?

First know the aim of the annuity. Is it to pay a regular bill, a mortgage, car payment, or school fees?

When you know what the annuity is for then you can look for the stocks, mutual funds and Exchange Traded Funds that will provide you with income.

This annuity is for regular amounts of income while you live.

You can include a Life assurance policy for the cost of funeral expenses, your beneficiaries will receive the portfolio of investments after your death.

So if you are looking for a fixed amount of income, say you have a $300 per month car payment. It is easy to build a portfolio of dividend and cash paying stocks and bonds that you can use to pay either part or all of your car payment, mortgage, or school fees.

I use this method to pay for my current college fees. A class costs me $160 per semester.

I invested $50,000 over the last ten years. It pays me just over $2,000 per year in dividends.

It comes out at about $100 in January and February, $400 in March, June and the other quarter months.

I take out $600 per year for fees and textbooks. This little annuity keeps on growing too as the market grows and as dividends increase. 

Last year it grew by 18.7%, 4% Dividend growth and just under 15% stock price growth.

To read

I am also building a $10,000 Portfolio for income beginning in October 2019. To read how that is proceeding go to my blog post at Financial Independence for the Blind.
 

ad more about building an annuity CLICK HERE.

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Fearing a Stock Market Crash in 2020

Welcome to the Investor in 2020.

Many people today are asking if there will be a stock market crash in 2020?

Will there be a Stock Market Crash in 2020?

Every year it seems the internet is all a buzz with the question of whether there will be a stock market crash this year. I have seen these headlines in financial papers and on financial  news programs for forty years now.

Bull or Bear in 2020?

The answer is a simple, no-one knows for certain. 

Last year   the markets went up, by around 30%. My own accounts went up between 25% and 14.8%. The 25% rise was in a single mutual fund stock portfolio which I had invested a large amount of cash on December 24, 2018, so hitting the market on it's lowest day of 2018. Gaining a large bounce in the first two months of 2019, over 12% in those first two months alone.

My 14.8% rise was in my long term holding Roth IRA. There are a lot of long term stock holdings in that account so they have had a long time to rise over the last 12 years since I opened the account.  Overall my long term return since 2007 is 133% overall.

Should I fear a stock market crash in 2020?

Personally I say not too fear a stock market crash in 2020, here are my reasons why:

•  Your time horizon for investing should be a long period. At least ten years for me.
• Crashes in the stock market are relatively rare.
• Crashes, corrections and dips in the market are good times to increase ones portfolio.
• Fear feeds fear, sometimes fear of a crash may cause a crash or correction for no reason. Thereby creating potentially profitable periods.
• Volatility in the stock market is normal. Creating potential profits.
• Being a contrarian, people showing fear tells me that there is still not an overall feeling of euphoria, which can actually portain a period of downward pressure on the stock market

I do not say to ignore the fear.

Acknowledge the possibility of a downturn in the markets. But maintain a level head.

• Buy stock in companies which make a positive cash flow and make profits.
• I like to take a dividend stock over a loss making growth stock.
• When in doubt, consider an Exchange Traded Fund or Low Cost Mutual Fund.
• Create a strategy, make yourself flexible and modify the plan and strategy to the circumstances.

• Never invest money that you will need this week or this year.

Read More advice CLICK HERE.



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Best Apps for Investors, Traders and Money Managers

My Christmas Apps For You

Christmas comes but once a year, and if you remember Christmas 2018  it was a bit of a down year.

Happily though this year saw the markets  come back with a vengence and we are looking at a bumper end to the year. Hopefully you are celebrating with us.

I am happy to say that Santa delivered his rally last year, so with fingers crossed and a tummy full of mince pies  I say thank you Santa, and please can we have some more next year.

I don't know about you, but I love playing with apps on my phone and my tablets. I love to see if they can help me generate more cash flow ind income into my Roth IRA and brokerage accounts.

Below I have created five lists of apps for you. There are apps for stock tracking, apps for money management, for fun, for  all sorts of useful stuff.

I hope that you will find an app or two that is useful to you over the next year and that you start the next decade off well. I raise a glass for your fortune and wish you prosperity and wealth in the next decade.

Now to the Lists.

1. Best Stocks and investing Apps

2  Best Personal Finance Apps

3 Best Accounting and  Expenses Apps.

4Best Banking Apps.

5.  Best Games Apps.

6. Best Fashion and Style Apps.

7. Best Astrology Apps.

8. Best Diary and Journal Apps.

 

See the latest new products on amazon here.

 

 

Bully! No More Brokerage Fees. For a Lucky Few

Bully! No More Fees

At the turn of the nineteenth Century, the term "Bully!" was a term of excitement and cheer. Even President Theodore Roosevelt was known to cry "Bully!" at times of excitement. Well the news from some of the low cost brokers on Wall Street that from early October 2019 they would be removing their brokerage fees for many investors on their platforms would have surely raised excitement for the market bulls.

Charles Schwab was the first to announce the cut in fees, almost immediately both TD Ameritrade and E*Trade followed suit.


From October 7, 2019 I will be among those no longer paying brokerage fees on my stock and ETF trades with my broker. This makes me bullish in the short term.

Why? Because I do not trade a lot. Last quarter I did some re-balancing and several stock purchases. In total I spent over $230 in fees. Over two hundred dollars in fees! For someone who doesn't trade a lot of the time.




If those fees are spread out over the course of the past decade say I have probably spent over $10,000 in fees. Bear in mind fees have come down since the early 2000's and so $10,000 is what I consider a minimum cost.

That $10,000 would have made a huge difference to my Roth IRA or other brokerage accounts. What about yours? How might have you managed your brokerage accounts or  your retirement account differently?

Is the move to zero brokerage fees a good one overall? I think our brokers know what they are doing.

I can see that they may increase the spreads on stock and ETF's so they may lose on the fee side, but more than make up on that by the penny or two those traders among us pay per trade. I am sure that for a while I may also buy more often. It is just a product of my now thinking that the price I see will be the price I pay without thinking I have to add a dollar or two to the price to cover fees.

Anyway, from tomorrow I will cheer on the brave low-cost brokers, Schwab, Ameritrade and E*Trade. Bully for you!

What do you think about the new low cost brokerage platforms? Will no fees play out for the benefit of all traders and investors in the long run?

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HowDid I Make My First $250,000

Some people say making the first $250,000 is the hardest.

I can say it took the longest part of my life. Over two decades.

New Opportunity

This week I received an e-mail from my broker.

Wall Street Bull Sculpture.

They wanted me to sign up for their program to lend my stock to other clients who are shorting the stock.

So a little suspicious of the offer. I called my broker by their regular number.

A piece of advice, check such offers are genuine with your broker, opening access to your account is not a good idea, so I wanted to know that this offer was genuine.

Turned out it was a genuine offer.

Read What are the risks of Loaning your stocks to a broker to short?

When I spoke to the representative from my broker on the telephone. He was able to confirm that the offer was genuine. I was very happy to sign up. Loaning stock to your broker to pass on to short sellers can earn you cash.

The process is:

A short seller needs stock to sell.

The Broker finds stock




The broker  Borrows the stock from an account

Places cash equivalent to the stock price, plus  a little extra into an escrow account.

Loans the stock to the short seller.

The short seller drives down the stock if they can.

The broker then either buys back the stock for me as a lender at a new low price or gives me back the stock. Plus I have been given cash in the form of a percentage of the charges made on the short sellers charges.

I am paid a daily rate for the loan of the shorted stock. This can range from pennies to several hundred dollars depending on the value of the stock, its scarcity  and the possible cost of recovery.

The daily rate of payment accrues for the period of the loan and once per month on a set date my broker will pay this cash fee into my brokerage account to re-invest.

At all times the stock remains mine, though I lose voting rights and any dividend payable is paid from the brokers account  not by the company.

At present within opening this account I have two stocks taken into a loan position. They only pay a few cents a day because I only have small positions. But they could make a nice little return since both only pay a dividend in December and January so even the few dollars that will accrue will add nicely to my expected returns for June 2019 and maybe for the rest of the year, if these stocks are favorites of the short sellers.

Thanks for reading. Don't forget to like or share this post and

Take a look at : What are the Risks of Loaning a Stock to your Broker?

Welcome To The "New" Investor Pages

In the last four months I have been a little busy, working my way through two classes at my local community college.

Luckily for me that time has seen a big rise in the stock markets, so my investments have been left well alone.

Hawthorn Blossom AKA May Flower

So here we are now in the month of May. The May Flower is in bloom at home in England and there is some relief from the Fall and Winter gloom of last year.

Except for one little thing I decided to do in December 2018. Remember those days and weeks in the run up to Christmas 2018?

Wow what a few weeks that was. Everyone was looking to Santa Claus for a rally. By Christmas Eve most people had given up on poor old Santa. Except for me that is.

On Christmas Eve I went all in with my accrued cash on the SPY. I bought, doubling my holding in the SPY ETF.

I couldn't resist. Santa Claus comes on Christmas morning and there he was handing me a bundle of stock at New Year Sales prices!




So in I jumped. I am so glad I did. Of course it could have all gone wrong. The nay sayers were all around. The sky was falling and I was gambling. Yes I was gambling. The gamble has paid off. I am not ashamed to say so.  I have called a market low, it happens from time to time with someone. This time I got it right. It will probably never happen again in my lifetime.

But this time I can say I called it.

Good enough for me. Did you call a bottom on Christmas Eve or maybe 10 years ago?

Tell me about it.


 Thank you for reading thus far, Pilgrim. I hope that you will continue to come back and follow my investing  journey.




I also have a book tip for you. Take a look at "Dividend Investing" A new book published in March. The book gets a 4.8 approval rating out of  39 reviews on amazon and most people say that it gives excellent ideas on how to build a dividend paying portfolio from scratch in easy to understand language. Take a look here.