When 40 Acres and a Mule Won’t Do!: Retirement Is Not an Age, but a Financial Number

I worked for decades in the finance industry, and can say that Cesar has provided simple, practical financial advice and strategies in this book. The average person should be able to follow her recommendations. As she states, one of the most important things to do is get out of debt, as soon as possible. It may take budgeting and some discipline, but it definitely is key to a better financial future. I can't remember if she mentioned this, but in terms of debt, it's important to avoid credit card cash advances. These carry extremely high interest rates and will only make your financial situation worse.Her coverage of investments is very comprehensive. Something that I think she could have emphasized more is that higher returns are offered on investments that have greater risk. (It can be almost like gambling. Returns on most investments are not guaranteed.) I know that retirement is a financial number, not an age, but if you're close to leaving the workforce for any reason, you should be taking fewer risks with your money/investments. Stocks are usually riskier than bonds, at least bonds with good ratings. (Also, if you want income, rather than growth, buy bonds. Even though many pay dividends, stocks are not really an income-producing investment.) I was working in an investment office when the "dotcom bubble" burst in 1995. My supervisor's parents' retirement accounts lost half of their value because they were heavily invested in tech. (I don't know when or if the accounts recovered completely, and the parents could not reenter the workforce.) As Cesar says, diversification is a good investment strategy.Another thing that Cesar may not have touched on is employer-matching in 401(k) accounts. Everyone needs enough take-home pay to cover their monthly bills, but if your employer matches your contributions up to a certain percentage, it's wise to gradually build up your own contributions to that percentage, or as near it as possible. Automatic deductions from your paychecks will make it effortless.If you're interested in buying property that's in foreclosure or being sold at auction, consult a real estate or mortgage professional. One of my first jobs in finance was as an assistant to the foreclosure officer at a title company. I'll never forget the client who thought that he had bought a house at a bargain price, only to discover that the documents he had signed required him to take over the hefty mortgage payments. He was horrified to learn that he was suddenly in a very bad financial position. Be sure that you understand everything that these transactions require before entering into them.One final bit of advice: unless you're Bill Gates or Warren Buffet, never, ever buy stocks on margin. (Buying on margin means borrowing from a broker in order to buy stock. You're betting that when you sell the stock, you'll be able to pay back the broker AND keep a large profit. This is very risky. Again, it's almost like gambling.) I was working for a Certified Financial Planner during a severe stock market downturn. A woman who had accounts with a larger brokerage firm came in to speak with him. Her broker had convinced her to buy several stocks on margin. Then the downturn hit, and they told her that, because she had bought on margin, she owed them $100,000. She came in to ask my boss if she really owed them that money. He had to tell her that, unfortunately, she did. I'll say it again: never risk more than you can afford to lose, and always make sure that you understand all the aspects of the investment.If you're new to investing, I highly recommend consulting an accredited investment professional, such as Cesar, before making any investments. Beware of cold callers or e-mailers ("I have a check/gift card for you", etc.), mailed investment flyers, circulars or newspapers, investment gurus who knock on your door or any other professional who uses high-pressure tactics. Learn how investments work and which ones are best for you. Reading Cesar's book beforehand is a good idea, too.

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