20 is the new 40

The Age of Government strikes again.

A close friend recently confided in me that he was going to Flight Trafficking school in Southern California. He wanted to learn how to be a flight controller for the FAA because 1) the pay was good right out of school 2) there exists a high degree of job security and 3) he could retire in 20 years. As he related the perks of yet another government job I couldn't help but feel a little bit sorry for myself. I've probably got another 45 years to work, considering that the cost of living will be higher in the future, I'll probably live longer, I'll have no access to Social Security and I'll be supporting my children financially at some level.

How does someone merit retirement after a mere 20 years of labor? I'm not trying to downgrade the fact that 20 years is a significant time or that the days are easy. Many government workers have stressful jobs with low levels of satisfaction, but so do many people in the private sector.

At the end of last month I was privy to another example of a government failing. My work is planning to construct an adjoining facility that will bring large amounts of tax revenue to the municipality. The plans needed to be approved by the City Building Commission, but as it turns out, they could not review the plans immediately because their offices shut down for two weeks at the end/beginning of the New Year. No one came in for two solid weeks. As a private sector employee, I receive two weeks a year of vacation to use at my digression, but here the government agency decided that they'd received a bit of surplus for the year and everyone was going home for two weeks. If that isn't an inefficiency in our current form of government, I don't know what is.

I look forward to joining my friend at his second retirement when I finally reach my first retirement. I'm so glad that I'll be funding not only my own, but also his life after work through my inefficiently allocated tax dollars.

Sell High??

The adage that I learned from my grandpa when I first started to invest was to buy low, sell high. This seemed like the most logical advice for any investor. It still makes a lot of sense to me, but the big question that still perplexes me is how do I know when a stock is high and how do I know when a stock is low? There is no definitive answer. There is historical data to tell an investor what the stock has done before, but most of the time that is bares no indication to what the stock will do in the future. For those of you who are investing and not simply gambling, relative highs and lows do not matter in the long run. If you are invested in a stock, bond, or real estate that is appreciating in value, hold on to it. By selling high you are opening yourself up to huge tax liabilities and perhaps losing out on the long run opportunity of an investment's returns.

As long as you decide to invest consistently and diversify your investment choices, don't worry about the short term price fluctuations.