What should I do? A letter from a 64 year old retiree.

I am sharing an exchange I had with a reader a few days ago because I think others could possibly be interested in it:

Hi, AK71,

1.        I have been following your blog for quite some time and find your explanation and reasoning of the stock market very interesting.  Not many people are so frank like you that are willing to give an in-depth advice of the financial market.    So far, I did not pen anything in your blog to ask for your advice, as I could not express myself well in writing. 
 

2.        I would like to seek your kind advice to set up a reasonable and proper stock portfolio to earn passive income.  I am a 64 years old retiree and living on passive income from dividends from my 44 stocks in my portfolio.  Overall, I have made a capital gain of about 15 - 20% from these 44 stocks (with some profits and some losses for each stock).    I know that 44 stocks are very difficult to monitor but I do not know how to diversify them.  Each time the market drop, my heart drop too.  At this age, I cannot effort to loss much of my hard earned money, as I do not have time to wait for the market to recover again.
 

3.        I would appreciate your kind professional advice.  Thank you.

My reply:

Hi J,

I really hate to disappoint you but I am not a professional financial adviser. I would suggest that you find professionals and engage their services.

However, what would I do if I were in your shoes? This is the part where I talk to myself. Please ignore me.

First, understand my motivations! I am in my 60s and retired. I am not able to suffer another market crash for more reasons than one. I am interested in a predictable flow of passive income.

Secondly, go through my portfolio of 44 stocks. Compartmentalise the investments into those that match my motivations and those which do not.

Thirdly, keep the investments which match my motivations and think about possibly increasing exposure to these investments when prices are softer. Sell those investments which do not match my motivations at an opportune time and never look back.

Fourthly, money from divestments should go into a dedicated "war chest" to buy more stocks which match my motivations during times when Mr. Market goes into manic depression.

Throughout, I have to understand that this is the general framework that I must keep in mind but being a framework, it will overlook finer details which could influence my decision to invest or to divest in specific instances.

Best wishes,
AK

Everyone has different circumstances and motivations. There is never a universal solution to all problems. If we understand our motivations, we will know what is most appropriate for us.

Related posts:
1. A letter from a 66 year old retiree.
2. A letter from a reader in his early 20s.
3. A letter from a 24 year old fresh grad.
4. Voices, noises and choices.

City Harvest Church: A personal account.

One story I have been following is City Harvest Church's.

I am just so amazed by how so much money was accumulated and how so much money was misused. $50 million!

Just now, I was directed to a personal account shared by someone who used to be a Ministry Member of the church.

The church used peer pressure very successfully to get people to give to the building fund... from getting people to pledge and using testimonies... I remembered people giving their hearts out for the Jurong West building. Never once, were members informed that monies from the Building Fund were used to fund Sun Ho's career, and certainly not about monies being invested in Xtron or Firna.

CHC and its pastors have lost it. They have twisted and traded the gospel for another, and the astounding thing is that, they still believe they are doing the right thing.

Read the full account in Facebook: Assi AK.