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2005-03-10 - 6:03 a.m.

I LOVE trading stock. But I do it a rather non traditional way. I've only purchased a few stocks in my limited experience. I recall the first time I bought a stock was during the tech boom and I soon after called the broker to place a LIMIT ORDER to sell it at some such ridiculously high seemingly unrealistic unfeasible number that the broker actually let out a large LAUGH then said "Well if it goes that high yours will be the first to sell." She had just spent a few minutes explaining the process to me as a newbie to the game.

I recall months later when Westely asked as sitting at his computer "What was that price you set your stock to sell at?"

I told him and he said "IT just hit it! "

It apparently hit my price exactly for literally only moments.

I sold my only stock I ever bought at it's ALL TIME HIGH.

And it saved us from IRS trouble as it turned out we REALLY NEEDED it to pay taxes that year....

OH THE STICKLY FURNITURE I HAD PLANNED ON BUYING MAY ONLY BE A DREAM.....but I'm not a materialistic kind of girl who really cares or even thinks of that. (Except now when I had to think about WHY I was going to sell that stock anyway...)

That was what I had THOUGHT I'd do with that stock. But I didn't mind selling it as it was really a gift from my hubby to have the cash to pick a stock and learn how the whole thing worked. It was a great experience and it was a great thing to later be able to BAIL HIM OUT when he realized he too had screwed up when the brokers were not taking out appropriate taxes as HE ASSUMED they had been doing for all his option purchases and sales through his tech work.

That was the year alot of tech folks lost their farms so to speak.... when getting the IRS bill.
They were all newbies too....

The REAL concern was the bit of the stock I HADN"T SOLD (I only sold about half) as it was to be the long term investment for kids college. OOPS
I SHOULD have sold all of that as well and just let it sit in a cash account or one of those college funds....

WELL higher risk entails both higher reward and loss potential.... But in the end I did fantastic overall. And even if my personal gain went to the IRS in particular that's OK as it maintained our very nice lifestyle!

I have since set up a trust fund for my two oldest kids with my brother (A BANK manager) as the Trustee so a little goes there when I have it for their future. Westley and I had met with a great tax/estate attorney and he helped us set one up for the shared girls of ours, then I was able to just copy that template to have the trust for the older two done as well.

Anyway, so my whole method of the stock thing is to pick a few stocks I can afford, buy them, then place a limit order in at some great price I'd love to see them hit. THEN DO NOTHING

That's the beauty of it.
Its a great long term investment plan for those of us managing our own retirement funds that don't have time or interest in watching stocks.....

But picking a few good stable ones to balance a few high risk w/ high potential seems to be prudent, all bought with cash I can afford to lose. (I figure at this point as I am not working no more than most people spend on eating out in a year, or going to the movies...etc.... the stuff I haven't time for!)

I love the fun of putting in some seemingly unrealistic high #.

I just placed my limit order on the few stocks I purchased in NOV. These are actually doing well. Unless I get news from my broker, I'll check on them again MONTHS from now just to see they haven't tanked.

OH- and regarding ESTATE planning: DO IT!
Westely and I actually gave a gift to one of his sisters - we told her to go to the attorney and have his set up her estate plan and send us the bill. It was suppossed to be her CHRISTMAS gift in 03 when she had bought a house. SHE NEVER WENT!

I told Westley we should just pay him AHEAD of time then have the attny CONTACT HER as that's the only way she'll go! She thinks she hasn't the assets or income so it is not worth it.

ANYONE with ANYTHING WHATSOEVER should go do estate planning with a good attorney, as well as taxes with a good TAX attorney.

She doesn't think its worth the money for an lawyer for either service.

THEY PAY FOR THEMSELVES - BELIEVE ME, in the taxes you won't have to pay and in the retention of assets when an estate is taken care of! I tried to explain regarding the estate planning stuff that if SHE doesn't choose a good attorney now who SHE want's to help her, and then something happens without a will and a plan, then an attorney will STILL be appointed to handle her matters and the bill comes out of the estate. So she can pay one NOW for her wishes to be known and to preserve her assets... or she can have her estate pay one LATER, and have the govt get a much larger chunk of her assets than would be the case if she got good advice and set up a few things.

She liked the idea and accepted the gift when it was discussed with her, but I guess isn't that interested. WE told her to find whoever she wants to do it for her.... not necessarilly the tax guru we know (BUT damn he is good! He's got over 30 years experience, and has taught at a few law schools, and is just a brilliant financial wizard when it comes to taxes and estate stuff- and he is HONEST.)

What I hate most of all is when I have heard of the BAD TAX advice (and illegal techniques) that people ARE willing to listen to - whether its from family or friends.... because they won't pay the few hundred bucks for a lawyer!

The best quote I got was "My mom said to do this. OH yes- she has a lawyer she consults with"

NEVER NAIVELY TRUST anyone else....


The real sad part though when I heard the above quote was the reality that if my friend followed her mother's advice and went along with what the mother asked her to do as a "favor"- my friend's mother would avoid tax responsibility.... and likely be dead soon enough... while my friend would have taken on the responsibility... which I am sure the IRS WOULD SOONER OR LATER catch wind of.
So that naive comment was really sad to hear, as it is possible that this friend's mother was shrewd and really so selfish as to do that to her adult child! (ALthough not likely-- more likely she was just dumb....)

Whatever it was... it was scary.

Snowing now! Girls are up and hungry!
To the library for a kids program today which should be fun. Entails the theme of lambs and lions.

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