Asset Profitability: A Balanced Approach to Improving Life and Sustaining Investment

After achieving considerable returns in the investment field, cashing out at the right time is not only a wise move but also a crucial step to secure the future. This understanding comes from years of practical experience and profound lessons. In the early stages of my career, every time I hesitated and missed a good opportunity to cash out, it left me with deep regret. Although the market conditions change rapidly, the fundamental principles of financial management remain constant.

The most important thing to realize is that when the returns are enough to change the quality of life, cashing out at the right time can bring immeasurable benefits: permanently improving the living standards of yourself and your loved ones. Just imagine, with a gentle click of the "Sell" button, you can immediately improve your living situation; how wonderful that would be. If you have such an opportunity, I strongly advise you to seize it.

I fully understand how tempting it is to wait for the best selling opportunity. People always fantasize that by holding on for a little longer, they will achieve higher returns. However, the reality is that the so-called best timing is often just an illusion. Those who are truly successful traders do not achieve their current accomplishments by perfectly timing every market peak. Instead, they succeed by continuously making profits and maintaining liquidity. They realized early on that cashing out profits in a timely manner is a necessary condition for long-term survival in this market.

One of the most important realizations for me is that opportunities are always abundant. This mindset helps alleviate the sense of missing out that traders often feel when considering cashing out. Indeed, letting go of a well-performing position can be regrettable, but remember: blindly holding out of fear of missing opportunities may come at a greater cost 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 the stability of your life. Once you reach this level, you can truly begin to participate in the market with ease and fully commit to pursuing higher returns.

Retirement Funding Required: Actual Needs and Common Perceptions

As someone who has been paying attention to retirement planning, I often wonder: how much money do I really need to retire comfortably? Although the media often promotes astronomical figures for retirement savings, I believe that for most people, between $1 million and $2 million may be sufficient. Let's analyze this issue from a traditional financial perspective.

According to data from 2022, the average retirement account balance for individuals aged 65 and older is only $232,710. This shows that suddenly having $1-2 million in retirement savings is no small amount. In fact, only about 3.2% of retirees have savings exceeding $1 million.

Of course, I understand that most readers of this article may not yet be 65 years old, but rather hope to retire early. When I first heard that Americans believe they need $1.46 million to retire comfortably, I was quite surprised. But then I realized a key point: this number is just an average, and each person's actual needs may vary greatly.

Let's consider the well-known 4% withdrawal rule, which is a common guideline for retirement planning. If you have $2 million in savings, according to this rule, you can withdraw $80,000 each year. For many people, this is enough to maintain a comfortable standard of living. Your retirement funding needs largely depend on the lifestyle you expect. Are you planning to travel the world, or are you content with simpler pleasures in life? According to the Bureau of Labor Statistics, the average annual expenditure for individuals aged 65 and older in 2021 was $52,141. Savings between $1 million and $2 million can easily cover this expenditure level.

Choosing a place to live after retirement can greatly affect your wealth utilization efficiency. A retirement fund of 1 million dollars may feel insufficient in a big city like New York, but it could support a rather luxurious lifestyle in a small town or certain places abroad.

The Importance of Psychological Factors

Knowing that you have savings of $1 million to $2 million can greatly alleviate financial pressure and allow you to truly enjoy the pleasures of retirement.

Ultimately, whether 1-2 million dollars is enough for retirement depends on each individual's specific situation. For many, this is not just a sufficient amount, but it may even exceed their expectations. The key is to start saving early, live within your means, and focus on the things that truly bring joy to your life. It's important to remember that retirement is not just about money; it’s about creating a lifestyle you truly love, regardless of whether your bank account has millions of dollars.

Once you deposit life-changing funds into a bank or invest in stable assets like real estate, you can participate in the market with a more relaxed mindset.

The "ease" referred to here does not mean it is easier to make money, but rather that your mindset will be more peaceful. You can make wiser decisions calmly and trade only at the best times. Even if you encounter losses, you will not lose everything because you have already built a safety cushion for yourself.

As industry experts say: "The real fun begins here." From this perspective, the current market cycle is more attractive to me. Even in the worst-case scenario, I at least have a solid backup. Of course, some people perform better under pressure, but I believe this does not apply to most.