Many people are concerned about whether their retirement savings will be enough for them to live comfortably in their later years. The Single Stock Retirement Plan is a strategy that seeks to make this worry disappear by urging you put all of your money into one stock and then counting on future gains.
Before you jump at the Single Stock Retirement Plan, make sure you understand what it is and how it can affect your retirement plan.
What is the Single Stock Retirement Plan?
The Single Stock Retirement Plan is a strategy that suggests putting all of your money into one stock. While there are many variations, the general idea behind this plan is to make your retirement savings dependent on the success or failure of one company because you believe in its potential for growth and want to capture those gains.
While it seems like a good idea, Single Stock Retirement Plan is not for everyone.
Alexander Green, the author of The Single-Stock Retirement Plan, said, “This is a high-risk strategy that should only be used by investors with at least 20 years before they need the money to live on.” Single Stock Retirement Plan can also take an emotional toll if your investment does not pan out as expected.
Who is Alexander Green?
Alexander Green is the founder and chief investment officer of The Oxford Club, an organization that helps people maximize their financial freedom. He has over 20 years of experience in finance and economics with Fortune 500 companies including Morgan Stanley, Dean Witter & Co., Credit Suisse First Boston, Citicorp Investment Bank, Prudential Securities Inc. and Paine Webber. He has also served as the chief investment strategist for United Press International, a senior financial editor at CBS Marketwatch and an economic columnist for UPI, AOL Money & Finance, The Washington Times and many other media outlets.
He is also the author of “Winning With Stocks in Retirement” (Prentice Hall Press), “Single-Stock Retirement Plan” (Wiley), and “The Single-Stock Solution: Build a High Growth Portfolio in Just Minutes Per Week!” (John Wiley & Sons).
How Single Stock Retirement Plan Works
With Single Stock Retirement Plan, investors put all of their retirement savings into one stock and then sit back and hope that the value of that stock grows exponentially. Single Stock Retirement Plan investors buy a high-growth firm with strong management, great products or services, and clear opportunities for future growth.
They then hold on to their investment until retirement age when they can validate whether it was worth risking all their money in one place.
Single Stock Retirement Plan is not for everyone. Single Stock Retirement Plan can be risky, especially if you are not willing to stomach the ups and downs of an unstable stock market.
If your retirement plan depends on one company’s success or failure, it can put a lot of pressure on you as an investor to make sure that the company continues succeeding so you don’t lose everything. Single Stock Retirement Plan is not the only way to save for retirement, so make sure you consider all of your options before making any long-term investments.
What are alternatives to Single Stock Retirement Plan?
Instead of Single Stock Retirement Plan, you can invest in other assets that are more stable and have a lower risk for loss.
Another strategy to consider is dollar cost averaging where instead of investing all your money at one time, you spread out the investment over several months or years. Dollar cost averaged investments reduce volatility because they take advantage of market lows and highs. Single Stock Retirement Plan can also be risky if you need the money in the near future, so make sure you have a backup plan for emergencies before considering Single Stock Retirement Plan as an option.
How easy is it to make money with the Single Stock Retirement Plan?
While Single Stock Retirement Plan does offer the potential for big gains, it also comes with a lot of risk and should only be used by long-term investors. Single Stock Retirement Plan requires patience and long-term thinking because you cannot time the market and Single Stock Retirement Planners believe that their investment will grow in value over time.
Before choosing Single Stock Retirement Plan as your strategy to save for retirement, make sure you consider all of the risks and alternatives. Single Stock Retirement Plan is risky but for some investors, it can be a way to make money quickly with less effort than other investment options.
What is the Oxford Communique?
The Oxford Communique is a monthly newsletter that highlights the best investment opportunities around the world. Alexander Green runs the Oxford Communique and it has been featured on CNBC, CNN Money, The Wall Street Journal, Forbes magazine, USA Today and many other national news outlets. Single Stock Retirement Plan is just one of the strategies that Alexander Green recommends in his newsletter.
Other strategies the Oxford Communique recommends are dividend growth investing and long-term value investing. Dividend growth investing is a long-term investment strategy in which Single Stock Retirement Planners invest in companies that pay dividends. Single Stock Retirement Plan investors then reinvest these dividends into more shares of the company to boost their income and potential for growth over time.
Long-term value investing is an approach where Single Stock Retirement Planners try to buy stocks at low prices so they can sell them at a higher price later. Single Stock Retirement Plan is more of an investment philosophy where you are willing to take on risk for the potential of high returns, rather than an actual strategy that investors use like dividend growth investing and long-term value investing.
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