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Author: TMFMurph Big gold star, 5000 posts Old School Fool Home Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 8740  
Subject: Great Article: RIPS! Date: 3/8/2011 9:02 AM
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Hi All!

David Knapp is right on target:

"...Let’s say that Wall Street’s financial wizards invented an entirely new product for retirees, called RIPS (for Rising Income Protection Security), with these characteristics:

Negligible fees.

Provides income at a reasonable rate, say 4% the first year.

The income is taxed at a favorable rate.

The income grows every year, faster than inflation in most years.

Principal can be retrieved at any time without penalty.

Over long time periods, principal grows or contracts approximately in line with the stock market, although usually with less volatility.

No matter what the principal does, the income stream grows every year, usually faster than inflation.

When you die, the entire product can be bequeathed to your heirs, and for taxation purposes, its cost basis resets to its current value.


Do you think that retirees might be interested in RIPS? I think interest would be huge. Why doesn’t Wall Street tout such a product? Perhaps because there is no money in it for them. Negligible fees, no loads, infrequent tiny commissions.

But the product already exists without fanfare or a cool name. It’s called a dividend-growth stock..."



http://seekingalpha.com/article/256958-you-re-retiring-where...

Cheers!
Murph
II/SPOPS/BigS/ALPHA Home Fool
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Author: BruceCM Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 6688 of 8740
Subject: Re: Great Article: RIPS! Date: 3/9/2011 9:51 PM
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Judging by the number of responses to this article on investing for income, there are clearly many retirees out there who value the dividends they collect.

BruceM

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Author: TMFBreakerRob Big gold star, 5000 posts Old School Fool Home Fool Supernova Phoenix 1
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Subject: Re: Great Article: RIPS! Date: 3/13/2011 5:56 PM
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I would suggest that in addition to reading the fine article that Murph linked to.....that folks read the comments after the article. Its an excellent (and civil!) discourse on income investing that I think folks here would appreciate. Not much on specific investments, but a lot of discussion on executing various dividend growth strategies.

Rob
RB Home Fool

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