Cocktail Investing

Chapter 2Getting Started

The secret of getting ahead is getting started.

– Mark Twain

Though no one can go back and make a brand new start, anyone can start from now and make a brand new ending.

– Carl Bard

Great love affairs start with Champagne and end with tisane.

– Honoré de Balzac

Hopefully, we have convinced you that you will be best served relying only on yourself for your retirement and that the investing wisdom of the 1980s and 1990s is no longer going to deliver the same types of results. Saving and investing for your future is a lot like ice skating for the first time—you can feel a bit unsure and wobbly at the start and it can take a bit more effort than expected, but once you get some momentum going, it can get a lot more comfortable and natural. So, where to start?

First Step: Saving

How's that for a topic heading to make you groan and skip ahead to the next section?

Saving: It is a dire imperative but calls to mind excruciating lectures by Mom and Dad accompanied by profuse finger-wagging and a desperate desire to stick one's tongue out—or maybe that's just us, but you have to admit spending can be fun. Out of respect for you, the reader, we'll make this as quick and painless as possible.

There are three types of savings, and everyone needs to have at least the first two of these three:

1. Emergency fund
2. Retirement savings
3. Special-purpose saving (buying a home, college for the kids, that dream vacation, man cave, or fantasy shoe closet, etc.)

Most financial advisors ...