Bull Run Profits: Balancing Quality of Life Improvement with Continuous Investment

If you have unrealized gains in the market that are enough to change your life, don't hesitate to cash them out decisively. This is not just advice, but a lesson I learned from painful experiences. In the early stages of my career, I often felt indecisive about whether I should take profits, and each time I hesitated, I regretted it deeply. Although our nominal wealth may fluctuate during the trading process, the fundamental principles remain unchanged.

I gradually realized that choosing to sell when the profits are enough to change your life will give you a benefit that cannot be measured in money: a permanent improvement in the quality of life for yourself and those around you. Just imagine, how wonderful it is to be able to immediately improve your situation in life simply by clicking the "Sell" button! If you have such an opportunity, I strongly recommend that you seize it.

I am well aware of how tempting it is to wait for the best selling opportunity: always believing that if you just hold on a little longer, you can gain more profit. However, the fact is: the perfect selling opportunity exists only in fantasy. The most successful traders I know did not achieve their success by precisely hitting every market peak; they succeeded by continuously making profits and maintaining liquidity. They understood early on that cashing out profits is key to long-term survival in this game.

One of my most valuable insights is that opportunities are always abundant. This mindset helps alleviate the fear of missing out that traders often experience when considering selling. Indeed, letting go of a well-performing position can be disheartening, but remember: holding onto it out of fear of missing an opportunity will cost you more in the long run.

I often think about what it means to reach "escape velocity": that is, your financial situation allows you to take planned risks without jeopardizing your life stability. Once you reach that level, you can truly start to immerse yourself in this game.

Retirement Fund: How Much is Enough?

As someone who has been contemplating retirement, I often wonder: how much money do I really need to retire? Although the media often exaggerates this number, I believe that for most of us, between $1 million and $2 million may be sufficient. Let's first analyze this issue from the perspective of traditional finance.

In 2022, the average retirement account balance for individuals aged 65 and older was only $232,710. Therefore, suddenly having savings of $1-2 million is no small amount, right? In fact, only about 3.2% of retirees have savings exceeding $1 million.

I understand that you reading this article may not be 65 yet, and you hope to retire before you turn 65. When I first heard that Americans believe they need $1.46 million to retire comfortably, I was very surprised. But then I realized a key point: this number is just 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 $2 million in savings, you can withdraw $80,000 a year. For many people, this is enough to maintain a comfortable standard of living. Your retirement needs largely depend on the lifestyle you want. Are you planning to travel the world, or are you satisfied with simpler pleasures? According to statistics, the average annual expenditure for those aged 65 and older in 2021 was $52,141. Savings of $1 million to $2 million can easily cover these expenses.

Choosing a place to live after retirement can greatly affect the efficiency of your wealth usage. A retirement fund of $1 million may feel tight in New York City, but it can provide quite favorable living conditions in a small town or abroad.

The Influence of Psychological Factors

Knowing that you have deposits of 1 to 2 million dollars can greatly reduce financial stress and allow you to truly enjoy retirement life.

Ultimately, whether 1-2 million dollars is enough for retirement depends on individual circumstances. For many of us, this is not just a sufficient amount, but even exceeds our expectations. 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 is not just about money, but about creating the lifestyle you love, regardless of whether there are millions of dollars in your bank account.

I understand the perspective of a certain industry insider. Once you have deposited life-changing funds in the bank or invested in physical assets like real estate, you can participate in the market with a more relaxed mindset.

What do I mean by "composure"? I am not saying that making money becomes easier, but rather that your mindset will be more relaxed. You can calmly make wiser decisions, choosing only the best trading opportunities. Even if you encounter losses, you will not lose everything because you already have basic protection.

As that industry insider said: "The real fun starts here." From this perspective, this market cycle is more appealing to me. Even if everything goes to zero, I still have a safe fallback. Of course, some people work more efficiently under greater pressure, but I don't think this applies to most people.