Thank you, Ron, for this continued response. Time is not doing me too
good, I almost missed this post. I am in a crash program to learn all
I can and maybe just all I really need. Income statements and balance
sheets are in my awareness, I am working toward minimal competence.
Advanced trading is not yet even in my personal horizon.

As mentioned I only have pennies a month and the few pennies so far have
been put into blue chips with aspirations of increasing their global
presence. The next thing I want to do is pick up some ETF's that are
aimed at specific parts of the market. One will be a REIT specializing
in commercial properties, probably, the other I am not sure about. By
middle fall I hope to also be in a mutual fund. At the moment I am
partial to the Vanguard family.

Time is not only a problem on a daily basis. My body could crash and I
will be left with whatever I have managed to that time; also I am
running up onto statuary limits- like 71 1/2. In real terms about 70.
The tax-deferred retirement account where I work will be dumped in my
lap unceremoniously well before the federal government can take it away.
I will have a "qualified distribution" going by then, but that will
just help reduce the tax bite.

Stock market investing seems the best way to attempt to prepare for
whatever is coming. I really do thank you for your ideas and cautions.

Charlie wrote:

- quote -

Have you learnt the basics such as being able to read a balance sheet
and income statement?

- quote -

If you are looking for an inlflation hedge, make your investments in
companies that reflect your expenditures.

You can sell covered calls to enhance your returns and lower your risk.

--
Ron

Thank you, Tad, for this response. Basicaly I agree with you. I
noted along the way that most newsletters have very short histories and
are also credited as being the result of one person's efforts.
Sometimes there is a backup staff with unknown levels of contribution to
the end product. That is, most of the other people would seem to have
their own jobs or functions. None of this creates much confidence.
However, a similar comment could be constructed for a large proportion
of mutual funds, ETF's, etc. A lot of them have not really been around
too long and are the product of one person or a very small group. The
longer-lived funds often have frequent changes of whoever makes the
decisions or provides the guidance. Changes seem to be a thing that
often cause very undesirable consequences.

In my paticular situation I have noted that a lot of the suggested
investments are in fact specific mutual fund offerings. Also both of
the newsletters I read prefer a fund family that is noted by several
disparate sources as being quite good and one of the least expensive.
About 60% of my total savings effort is actually in the TSP. That is a
collection of mutual funds including US government securities, bonds,
several classes of stocks, and a group of international securities.

In the short term I am trying to obtain some real world experience with
the market. Elle stressed not planning on dying, but it cannot be
ignored either. I would note that I am two years older than Ken Lay
(although not 10% as smart, hopefully 10X as honest). If I do suddenly
leave for another universe this money could be left by itself for a
substantial length of time until some specific toddlers need college
money. For the long term the newsletters are a screening device to help
pick companies who will still exist and whose stock stands a good chance
of maintaining its relative worth. And yes, some stocks are going to
be things that I am playing the odds with. But then some people do
horse racing or Vegas? The intent is mostly to just hold position in
the rising price of everything. The problem is to find the best way to
do that and also knowing that in 4 years all my tax deferred efforts are
going to be dumped back over my head. When that happens I need to know
what is best to do to handle the situation. This is a part of my
attempt to learn as much as I can before it is too late.

I do appreciate your comments and they will be a part of my database.

Charlie wrote:
- quote -

Charlie,
If you can save $1k/month for the next three years, and leave it alone
for 8-9 years, then certainly - it makes sense to invest that money so
it grows. And you might decide that the riskiness of stocks is OK,
instead of the guaranteed return of, say, US savings bonds.

But I would put individual stocks, selected using newsletters, at the
bottom of the list. To be blunt, it's unlikely you're going to find
winning stocks that will give you a better-than-average return on your
money, because most professional investors aren't even able to do it.
Using newsletters makes you reliant on the author, and if you read those
Hulbert reports, the main message is that newsletters as a group don't
seem to be very reliable sources of stock-picking tips. This is
especially true if you factor in all the newsletters that go out of print.

Why add that risk? Instead, you could invest your money using mutual
funds, allowing you to invest in stocks without having to pick
individual ones and keep up with the companies. A good start would be to
look at the approach of the "LifeStrategy" funds from The Vanguard Group
(www.vanguard.com). These are no-load funds with low annual expenses.
There are similar funds out there from other companies, but these will
give you an idea of what's available in this category of mutual fund.
The funds combine investments in a broad mix of investment types - US
stocks, foreign stocks, bonds - in percentages based on how much risk
you'd like to take on. Looking at the materials on those funds will give
you an idea of how risky stocks are over the time period you'd be investing.

It might take a couple months to build up the money for the initial
purchase, but after that you could keep putting $1k into the fund each
month, then let it ride. Looking ahead 12 years from now, I think it's
more likely that your nest egg will have grown if you take this approach
than if you pick individual stocks from newsletters.

-Tad

Thank you, Elle, for your response. If I can hold up to the daily
grind, on my feet doing maintenance on machinery and I am already
having serious problems, then I would hope to be able to put the $1K
into a reserve plan until I retire. Once retired this money is part of
the daily budget. At 69 I will be only a hiccup away from mandatory
withdrawal or qualified distribution of the TSP. My current expenses
are very close to the total of pension, SS and a thousand a month or
perhaps more. I am uncertain how much takehome will come from the
pension because of taxes and medical coverage. I do have a decent guess
because of the reports of some persons who already retired. Medical
coverage will be vastly better than Medicare-Medicaid. Long term care
needs are certainly a possibility, but family history calls for a heart
attack. Actuarial tables say money will not be a problem: that I will
take up raising daisys at about 74. Contemporary experience pushes that
up 10 to a dozen years- so long as the medicines I take continue to work.

I am reluctant to get involved with a Roth because of the short time I
would have to contribute to it. And I have read the rules for it but do
not readily recall them. My mental note says there is something that
makes a Roth undesirable or unavailable to me.

My actual needs for money are estimated from a careful evaluation of
current expenses and probable needs in the future. Some things can only
be guessed at like how much gasoline will my car need and what will the
price per gallon be? How much will that cost of fuels affect the cost
of everything else? Like groceries. In spite of senior status, my
state taxes are a wild guess. This state does a lot of heavy property
taxation in lieu of an income tax.

I have looked at that 4 percent rule. I need to pick up a couple of
hundred thousand from the lottery to do that!!

I will follow your link to tools and see what I can find out there.
Again, thank you for your response.

"Charlie" <charlie[at]comcast.com> wrote
- quote -

What do you mean by this?

- quote -

after that, you can add no more. You want to know if it's a
good idea to put some or all of that roughly $1k/month into
the stock market. Correct?

You say you're 66, could work three more years, and then
could draw (so as to be comfortable) on your pension, SS,
and the principal of your TSP for about another five years.
Then the TSP is gone. Correct?

That means this $1k/month could go untouched for at least
eight years.

Please clarify the following points:

Must you draw down on the TSP to live comfortably? I would
like to see more information and then run some numbers to
see if you could drawdown more slowly on your TSP and this
hypothetical portfolio of stocks to continue to live
comfortably. More and more I think drawing down
significantly on principal, based on a guess at the
drop-dead date, is a huge mistake, unless one is in truly
dire straits.

Do you qualify to contribute to a Roth IRA? Even at your age
doing so can make good financial sense.

Have you considered the cost of long-term care and how you
want to live your last few years?

A rough rule of thumb for how much to draw from one's
investments so as to never consume the principal is 4%. How
much do you need each year to live "comfortably"? Take this
number, subtract the annual value of SS and your pension,
divide it by 0.04, and that will give you some idea of what
you need to save to retire "comfortably," for starters.

Some easy-to-use and free tools for retirement planning
appear at http://home.earthlink.net/~elle_navorski/id4.html
. Maybe take a day or so to get some idea of the bases for
these tools. Then experiment with them for a month or so,
and ask more questions.

What is your thinking on starting investing in the stock market? This
is intended as a supplemental fund to a small pension, Social Security,
and Federal Government TSP. The time horizon is two to three years.
The monthly amount for investment is about $1k if all goes well. It only
recently became possible to attempt something like this. I am 66, my
doctor says that I should plan for another 20 years. The pension and SS
will provide a minimal living. The TSP will allow about 5 years of my
current lifestyle. I want to try the stock market with the objective
that the gains will keep my invested money at about the same level of
buying power against inflation and other probable rising costs of
living. Add 5 years until the TSP is gone to 3 more years of working,
and withdrawal from this fund will begin in about 8 or 9 years. By the
time I am out of supplemental money I will be in my high 70's or later
and it will be a very different world. There was a very bad experience
with brokers and investments in the family in my lifetime, I do not
want to let that happen again. I am newly opening a discount brokerage
account and trying to use a couple of newsletters for advice -
Morningstar is one, the other was suggested by a friend who says it has
aided his investment activity for several years. I intend to buy
stocks of recommended companies that are names I recognize and which
appear to be doing well in the real world. The intent is to hold these
stocks until the cash is needed. Common sense- to the best of my
ability- will be used to deal with the stock market. Most of you who
post are financial professionals or otherwise very knowledgeable and I
would like to see your opinions, suggestions, alternate plans or
approaches to this? I apologize that the address I use is bogus for
reasons of security. If desirable I can, by invitation, contact you
directly. That return address will be real. Thank you all for whatever
you have to offer and for the ideas and information that routinely
appears on this forum.