Sow a Seed
My mentor, Marc Overman, recently gave a talk about the need for changes in traditional retirement planning. Check out is blog insanemoney.com.He advised that any form of retirement planning in the 21st century required an “active educated risk manager” versus the static ignorant risk avoider. He also advocated a self-managed retirement plan. I agree. A largely ignored part of retirement plans is a consistent real estate investment portfolio. In other words, cash savings should continue on a dollar cost average basis but with the seeds of real estate sown in to yield a crop of retirement benefits in the future. An analogy that might help you look at real estate in a new light is what happened to the logging industry. At the turn of the century, logging companies would clear cut acres of land. After years of cutting without a thought of future timber shortages, the idea of replenishment took hold. This is the idea that as logging companies cut they will replant the trees and allow a new crop of trees to grow in the future. In retirement, clear cutting real estate should be replenished by seeds sown and then harvested when the crop is ripe. Some real estate might be held for 10 or 20 years before it ripens to the point of harvest. Here is the lesson if you are not sowing seeds of real estate to harvest when the crop is ripe then you will be failing to be an active educated risk manager. Go out and sow some seeds.AH

Cris on 22 Apr 2008 at 3:13 am #
Taking an active role in your financial future is very important.
Mike on 22 Apr 2008 at 1:12 pm #
I have taken one step, mainly cuz of my partner but, its definatley not enough.. Diversification is probably good inmy future