esrosedotblog

FIXATION

Did I tell you that I live on a fixed income?

It is a line I use. I am surprised if you never heard it.

Of course, it is just a line. Everyone lives on a fixed income. Whatever you live on is fixed! For now. And most of us manage to spend right up to it and a bit beyond.

But really, nothing is fixed. Everything will change. For better or worse.

The fiction of this kind of 'fixed' thinking becomes important when I contemplate my IRA. I have quit adding to it, so I view it as fixed. Nonetheless, I keep waiting for it to increase. What a double bind.

The simple fact is that my bind is based on laziness.

My neighbor, Ben Stein (just down the road in Rancho Mirage) knows all about me and he wrote an op ed in the NYT about it:
Read Your Statements. Dump Your Losers. Take a Swim..

Ben is an economist, a writer, and a sometimes actor. A rennaisance man. What I like about his article is that it rocks me out of my laziness. And, I am up for the swim part.

To get the swim, I figured, I had a little work to do. So I jerked myself out of the fixed thinking thing. I went through his suggestions. First: Read my statements. Well, I do that. I have never caught an error but I sure know what is up and what is down.

Then he suggests really looking at the market prospects and consider finding stronger income strategies; not growth, like I have been. Too much risk there.

Net, net, I have to get realistic about my hopes that my IRA will grow. I will not rehash the market history for you. It is like life. Up and down and if you only look at the top line, mostly down.

I have been hoping that the much predicted cap growth market would arrive. The last months since the new year have shown me that the wait may be a long one.

Did I mention that I don't have a lot of time? The long view is beginning to shorten. I don't mean that I feel death's chill. Quite the contrary. But, when people talk about riding growth they better be looking at the looooooooooong term. Shit. By the time this market gets some growth I could be looking at a dwindled nest egg. Talk about fixed. Fixed on a downward spiral.

So it is time for a little tweaking. I am taking a third and putting it in a dividend intensive portfolio. That is what they call it anyway. The emphasis on more predictable income.

I looked at all the paper I had to sign and wondered if this is a good thing. Hell. I don't know. I do know that it is a different thing.

The third suggestion neighbor Ben makes is that I get rid of the dogs. I have held on some mutual funds that I bought years ago pre-dotcom bubble. Some worked; others tanked. I made the mistake of getting back end funds. You pay when you take them out. Not smart. So I will pay and they will be gone and the only dog I will have is Franklin.

Fourth, Ben says: "look for new market products". So I called my advisor, Sasha, and put a lot of the previous thinking to work. We are rearranging a third of the IRA to go into a more income oriented fund which is not exactly new but surely is new to me. I signed the papers today.

Don't get me wrong. I am not in jeopardy. I am comfortable; a little antsy but that is normal. The IRA isn't the only thing going. There is the real estate. Truth be known, I have made more money out of real estate than anything else in my whole life. And without trying.

Worse comes to worse we can always do the reverse mortgage gambit. The last refuge of the deluded stock and bond holder. Or sell the house. But that is way radical thinking now. When I think that way I start to think that the current bubble will break. But we are now in triple the original investment territory so the bubble could leak some air before we would get wet.

And finally, there is Social Security. The very last line of defense against the wolf at the door. Bushie ain't havin' any success screwing that one up.

Oh. Another thing I learned from Ben. In the midst of all this serious thinking he did something 'unwise'. He bought a house at the top of the market because he liked it. I gotta remember that. In the midst of all this financial angst I have to remember that what it is all about. To do what I like when I like the way I like. Not a bad goal.

Now, I am going to take a swim in the pool. The water temps today are up to 87-88 degrees. I think I will leave the cover off tonight again. The solar is pretty much in balance with the weather. I wonder if Ben is in his pool.