If you have life-changing unrealized gains, hear me out: you need to sell it. This is not just a suggestion; it’s a lesson I learned from painful experiences. Early in my career, I hesitated to realize profits, and I regretted every moment of indecision. Nominal wealth may fluctuate throughout our trading journey, but the fundamental principles remain unchanged.

One thing I gradually understood is that selling when it is life-changing will provide you with a benefit that cannot be measured in money: a permanent improvement in your life and the lives of those around you. Imagine being able to click ‘sell’ and immediately improve your life situation. It’s wonderful! If you have such an opportunity, I strongly recommend you seize it.

I know how tempting it is to wait for the perfect selling opportunity: believing that if you just hold on a little longer, you’ll get more profit. But the truth is: the perfect timing is just a fantasy. The most successful traders I know didn’t reach their achievements by perfectly timing every peak; they succeeded by consistently realizing profits and maintaining liquidity. They understood early on that converting to cash is a necessary condition for survival in this game.

One of the most liberating realizations I had is that opportunities are always available. This mindset helps alleviate the fear of missing out that traders often feel when considering selling. Yes, letting go of a well-performing position can be unsettling, but remember: holding onto it out of FOMO will cost you more in the long run.

I often think about what achieving ‘escape velocity’ means: that is, your financial situation allows you to take planned risks without jeopardizing your life stability. Once you reach that level, that's when you can truly start playing the game and go all in.

How much money is enough for retirement?

As someone who has always thought about retirement, I often wonder: how much money is enough? While the media often boasts that it takes astronomical figures, I believe that for many of us, $1 million to $2 million might be the sweet spot. Here’s why, let’s first look at this issue from the perspective of TradFi.

In 2022, the average retirement account balance for those aged 65 and older was only $232,710. So, suddenly having $1 million to $2 million is not so uncommon, is it? In fact, only about 3.2% of retirees have saved more than $1 million.

Okay, I get it, the likelihood that you reading this are over 65 is low; you want to retire before 65. I was shocked when I first heard that Americans think they need $1.46 million to retire comfortably. But then I realized something crucial: this number is an average. Everyone’s needs can vary greatly.

Let's consider the 4% rule, which is a common guideline for retirement planning. If you have saved $2 million, you can withdraw $80,000 each year. For many, this is enough to live comfortably. Your retirement needs largely depend on the lifestyle you desire. Are you planning to travel the world or are you content with simpler pleasures? The Bureau of Labor Statistics reports that the average annual expenditure for those aged 65 and older in 2021 was $52,141. Savings of $1 million to $2 million can comfortably cover this expense.

Choosing where to live after retirement will greatly affect how you use your wealth. A $1 million retirement fund may feel tight in New York City, but can provide a luxurious lifestyle in a small town or abroad.

Psychological Factors

Knowing that you have $1 million to $2 million saved can alleviate a lot of financial stress, allowing you to truly enjoy retirement.

Ultimately, whether $1 million to $2 million is enough for retirement depends on your personal circumstances. For many of us, this isn’t just enough money; it may be more than we dreamed of. The key is to start saving early, live within your means, and focus on the things that truly bring joy to your life. Remember, retirement isn’t just about money; it’s about creating a life you love, regardless of whether there are millions in the bank.

I understand what Fiskantes is saying above. Once you have banked or invested life-changing money in real estate, you can easily participate in the market.

What do I mean by easy? Well, I’m not saying it’s easier to make money; I mean your mindset is more relaxed. You can make better decisions calmly and let trades come to you. And even if you lose, you won’t lose everything, because you already have a safety net.

As Fiskantes said: ‘The real fun starts here.’ In this sense, this cycle is more interesting for me. If everything goes to zero, at least I still have a safety net. That said, some people work better under pressure, but I don’t think that’s true for most people.

[Disclaimer] The market carries risks, and investments should be made cautiously. This article does not constitute investment advice, and users should consider whether any opinions, views, or conclusions in this article are suitable for their specific circumstances. Invest at your own risk.

  • This article is republished with permission from: (Foresight News)

  • Original author: Route 2 FI

‘Still waiting to make big money before retiring? Cryptocurrency researcher: sell quickly when your unrealized gains are enough, opportunities are always there.’ This article was first published on ‘Crypto City’