{"id":25307,"date":"2011-11-18T19:00:41","date_gmt":"2011-11-19T00:00:41","guid":{"rendered":"http:\/\/countingpips.com\/fx\/2011\/11\/18\/saving-yourself-for-a-debt-free-retirement\/"},"modified":"2011-11-18T19:00:41","modified_gmt":"2011-11-19T00:00:41","slug":"saving-yourself-for-a-debt-free-retirement","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/11\/18\/saving-yourself-for-a-debt-free-retirement\/","title":{"rendered":"Saving Yourself for a Debt Free Retirement"},"content":{"rendered":"

By MoneyMorning.com.au<\/strong><\/p>\n

A 349-Year-Old French Gambling System That Can Help You Live Debt Free\u2026?<\/p>\n

If you’ve followed Money Morning<\/em> over the last few weeks, you’ll know Kris has warned you about the government helping itself to your retirement savings<\/em>. Taking your money directly to invest in pet projects…<\/p>\n

Or coercing funds to invest a certain percentage of your retirement savings in these projects by law…<\/p>\n

Maybe you thought he was nuts. Maybe you thought he was bang on the money. Maybe you thought he was joking.<\/p>\n

But no matter what you think, what if he’s right?<\/p>\n

<\/span>
\nWhat if the government really is going to rip your retirement savings away from you? What will you do?<\/p>\n

Blaise Pascal – the 17th century French mathematician, philosopher and physicist – once said, ‘Only a fool would bet against God’. And we’d argue, only a fool would bet against the government interfering with your life – and your money – too.<\/p>\n

Here’s the system Pascal came up with to make sure he’d ‘win’… and it’s one you can follow to a debt-free retirement too.<\/p>\n

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\nPascal reasoned: Maybe God exists. Maybe He doesn’t. If I don’t spend an hour a week at church, I might get stuck in Hell for eternity. But if I just sacrifice one hour to go to church a week, I could get into Heaven. And I also get to sing songs. And socialise. And hear the weekly gossip. I have everything to gain and nothing to lose!<\/p>\n

Now there are plenty of arguments against this philosophy. We won’t go into them here…<\/p>\n

What we want you to focus on is the win-win logic behind the argument. And how you can use it live debt free in retirement<\/strong>…<\/p>\n

Wouldn’t it make sense for you to make your own ‘Pascal’s Wager’ for retirement now… That is, put yourself in a spot where you have everything to gain in retirement and nothing to lose?<\/p>\n

Take a look at our own betting matrix…<\/p>\n

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Click here<\/a> to enlarge<\/div>\n<\/p>\n

As you can see, if you believe Kris when he says your retirement savings are under threat… and prepare… it’s heads you win, tails you win even more!<\/p>\n

All you have to do is prepare for your retirement as if you believe your retirement savings are under threat. That way, whether they are or not, you’ll come out a winner.<\/p>\n

Now there are a number of strategies you could use. Unless you’re prepared to put dollars on the line… to take some risks… you’ve got virtually no chance of maintaining or improving your standard of living. <\/p>\n

Remember, Pascal had to put in the time at church if he wanted to get to Heaven.<\/p>\n

Here’s one method Kris believes you could for your own Pascal’s Wager…<\/p>\n

Use the magic of compounding…<\/strong> Buy no more than a handful of reliable blue-chip stocks that pay a regular dividend.<\/p>\n

These should be stocks you’re prepared to hold through thick and thin… and they should be good enough that you could think about taking part in the dividend reinvestment plans (DRPs) to compound your returns.<\/p>\n

A DRP gives you the choice to get extra shares instead of a cash dividend.<\/p>\n

But it’s better than it sounds!<\/p>\n

Because when the next dividend is due, you’ll earn a dividend from your original shares AND you’ll get a dividend from your new shares too.<\/p>\n

Every dividend payment date, you get more shares in the company… without<\/u> having to pay commission to a broker.<\/p>\n

It means that five years from now, your shareholding could increase by 50%… and 10 years from now, your shareholding could have more than doubled.<\/p>\n

Here’s how it works:<\/p>\n

Imagine that in 2011 you buy 1,000 shares in XYZ SHARES at $1.74 each = $1,740<\/p>\n

By 2016, thanks to reinvested dividends, you now own 1,507 shares. If we assume the share price has risen to $2.04, your shares are worth $3,074. If you hadn’t reinvested the dividends your shares would only be worth $2,040.<\/p>\n

Roll forward another five years, and by 2021 you could own 2,329 shares. And assuming the share price has climbed to $2.34, your investment would be worth $5,448 (2,329 x $2.34).<\/p>\n

In other words, your initial one thousand shares have compounded to be worth more than three times your initial stake.<\/p>\n

That’s the power and magic of compounding returns.<\/p>\n

And that’s just with 1,000 shares.<\/p>\n

If you can afford 5,000 shares today, for a total investment of $8,700, you’re looking at turning it into $27,244 in 10 years. By which time, if you’re ready to retire, you can start collecting cheques of over $2,500.<\/p>\n

Getting access to the DRP is easy. You simply buy shares in a company that offers this plan and then fill in the form.<\/p>\n

Aaron Tyrrell
\nEditor, Money Morning<\/em><\/strong><\/p>\n

P.S. This is just ONE of the investment ideas Kris Sayce has shared with readers of Australian Small-Cap Investigator<\/em> this year. Feel free to use it to help you make money for the future from this market.
\nTo find out more about Kris’s latest money-making ideas – and how they can help you place your own Pascal’s Wager for retirement – please click here<\/a>…<\/p>\n

Aaron Tyrrell
\nEditor, Money Morning<\/em><\/strong><\/p>\n

\n<\/img><\/a> <\/img><\/a> <\/img><\/a>\n<\/div>\n


\nSaving Yourself for a Debt Free Retirement <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

By MoneyMorning.com.au A 349-Year-Old French Gambling System That Can Help You Live Debt Free\u2026? If you’ve followed Money Morning over the last few weeks, you’ll know Kris has warned you about the government helping itself to your retirement savings. Taking your money directly to invest in pet projects… Or coercing funds to invest a certain … <\/p>\n

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