What Should You Do When You Retire?

Once upon a time, it seems not so long ago, I was the mother of infants.  My hair's natural color was brown and retirement was a long way away.  Now my "baby" is twelve, my middle child is graduating from college and the oldest is twenty-four.  Time has flown by; I won't talk about my natural hair color, and before I know it, retirement will happen.  

Most of us realize we need to plan financially for retirement and so we pay off debt, contribute to our 401k plans and invest in stocks, bonds and real estate.  We want to have money when those paychecks stop arriving. 

But what are we going to do with our time, once our employer doesn't fill 35% or so of our waking hours?  Last time I checked, one of the best reasons to get a job was to avoid daytime television.  Are there other ways to avoid that wasteland?  While we don't want to turn retirement into another "to do" list or job, having a plan will help us get the most out of our golden years.

2016: Expenses: The Year in Review

This is the time of year when bloggers start looking back at the year, seeing what went right, and seeing what went wrong.  I'm going to take some time this week to look at this year's major expenses and comment on them.

In either December or January we will make our last contribution toward my daughter's college education.  We've been lucky--for tuition, room, board and books we've paid about $24,000 for four years.  This has been a planned expense but one I'm glad is about done.

Another Look at Motif

I've spent the last two weeks reviewing no-commission stock brokers so I thought that I'd spend this week taking another look at a low-commission broker, Motif.  

When I started investing with Motif, they offered the ability to buy a motif--a basket of up to 30 stocks--for one commission of $9.95.  You could invest as little as $300 in the whole basket.  Now they have added the ability to trade individual stocks for a commission of $4.95 per trade.  Periodically Motif offers reduced commissions for certain activities.  For example, on Black Friday they offered 50% off all commission.  

How Does the "Motif" Concept Work?

Motif offers some professionally designed motifs--baskets of stocks based on a certain theme or investing goals.  I own two  motifs of dividend paying stocks, one of companies which have bought back stock, one that contains stock in companies involved in cyber security, one of stocks with low beta, one dealing with video gaming and one of stocks in companies with whom I do business.  The professionally designed motifs include companies I've never heard of, much less considered investing in.  The professionally designed motifs are rebalanced regularly, and investors are encouraged to rebalance their holdings in that motif accordingly (and to pay the associated commission) but they are not required to do so.  I have not chosen to rebalance my holdings and taking a look at all of them, using 20/20 hindsight,  at least so far, it has been the right choice. 

Does Motif Have Anything New?

The latest thing Motif is offering is "Motif Blue", which is a subscripton service.  Users pay a fee of between $4.95 per month and $19.95 per month based on the level chosen.  The starter level is for people who have only one motif and it  allows you to auto-invest in that motif and to auto-rebalance it monthly.  The mid-level "Standard" offering is $9.95 per month and allows auto-investing in any number of motifs, auto-rebalancing of all professional motifs and one commission-free stock or motif trade per month.  Users are also entitled to some market reports.  The $19.95 level gives real-time stock quotes and gives up to three free stock or motif trades per month.  If you'd like to try Motif Blue, use this link and you can try it for three months, free.  If  you do, I get free time too.  

Do I Recommend Motif?

Somewhat.  A motif is similar to a mutual fund or ETF in that it is a collection of stock shares.  It offers a level of diversification that purchasing shares in one company does not.  If you want someone to do the work for you and assemble a basket of stocks fitting a theme, then Motif can be a relatively inexpensive way to achieve that diversification.

However, unless you have an aversion to trading via smartphone, you can get lower costs (though not factional shares) via Robinhood.

For small investors though, due to fractional shares, you can get a higher level of diversification via Motif.  You can purchase a motif for as little as $300 and that motif can contain shares of as many as thirty different companies.  Obviously, $300 will not buy you anywhere near full shares of those companies but Motif allows the purchase of frational shares.

What Are My Plans With Motif?

My plans for my Motif account are to basically hold it.  I have eight motifs.  I created one of them, the other seven were "motifs of the week", offered for sale at no commission the week I bought them.  There are far too many companies involved for me to have a life and keep current on the details of each one.  

If I decide I want out, I can either sell the shares in a particular company in a motif, and pay a $4.95 commission or I can sell the whole motif and pay $9.95. Considering that a "large" position for me is $200, selling off share of individual companies is going to eat my profits quickly.  I plan on reviewing the motifs I own on a periodic basis and if they are not keeping up with the market, I will probably sell the motif as a whole and reinvest the money via Robinhood or Loyal3.  

Many of the companies I own via Motif pay dividends I have been withdrawing those dividends and reinvesting via Loyal3.  Now that I have a Robinhood account, it will be getting those dividends.  

Have you invested via Motif?  Do you think it is worthwhile?