October 9, 2008
Dear Everyone:
Scary times.
When the value of your stock drops over $9.00 in one day…Yikes!
When I started working for Standard XXX Company of
Fill-In-Blank in 1973, you had to work for five years (or be over a
certain age) to be eligible to enroll in the company
Stock Plan.
It was an incentive to encourage long-term employment.
The idea was, you put a percentage of your wages into the plan
and the company matched it.
At times, the company even paid more into the plan, so your $1.00 might
be matched by $2.00 or more, depending on how much profit the company
was making at the time.
By buying stock, you were saving money for
retirement, plus you owned a piece of the company.
So I joined the plan as soon as I could and have been in it for
about 30 years now. Years
later, they got the idea to put your money into the plan before it could
be counted as income for taxes.
They figured you would be in a lower tax bracket when you
eventually take it out after retirement.
At first, the only thing you could buy was stock.
Then they “diversified” and I started putting money towards
money
markets. By that time I was
putting away 2% of my base pay into stock and 4% into money markets.
And remember the company was matching that 6% at least, if not
more.
In 2001, when
Enron imploded, “Jeannie” called me
one day and said, “I’ve been instructed to inquire discreetly how much
of your retirement plan is in company stock.”
I told her, “2% stock, 4% money markets.”
But by that time, I had been buying stock for so many years that
the 4% hardly made a dent in the ratio.
After the company acquired “Another Company”, a
different investment company took over the 401(k) plan and added online
banking/investing. I
attended a seminar a few years ago in which I realized that I needed to
move some of my investment out of stock and into
bonds.
So every so often, I’d move a small percentage out of stock and
into bonds of some sort.
Then about a year ago, I got an offer from the
investment company that they would take over managing my account for the
price of $5.00 per month, or $60.00 per year.
Such a deal! I went
for it.
Gradually, they’ve been moving things around so
that my portfolio is now about 60/40 stocks/bonds.
Still a bit stock-heavy, but it’s nice to know that 40% of my
retirement fund is (relatively) safe when the Stock Market keeps
tumbling like an extra in a
Steven Spielberg action flick.
In other news…
“Jeannie”
and I are going to
What changed last Friday was the part about me
attending the Conference. It
seems that Company Information Technology Company (CITC) has been
spending money a little too freely in pursuit of the GIL 3 Project.
Word went out to curtail extracurricular activities, including
conferences.
I was looking forward to attending the Conference
and possibly seeing people I haven’t seen in a while.
And I was counting on the Continuing Education credits that I
would get towards maintaining my Certified Records Manager (CRM)
credentials. What I was not
really looking forward to was sitting through boring lectures and
packing for a week.
Now things are much simpler.
“Jeannie” and I can drive to the airport together, stay at the
(did I mention it’s free?) time share, play around for the weekend, then
come back together on Monday.
And I only have to pack weekend stuff and not “business casual”
stuff.
What all this means is that there will not be a
Letter next week as I’m taking some vacation time to get ready before
our trip. In the meantime,
Love, as always,
Pete
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