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8 Ways To Retire By Age 50

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It’s never too late to start saving for early retirement, but the sooner you start saving and investing your money, the more time it will have to grow.

If you want to retire by age 50, you need to be willing to work hard and be creative. You must take risks, manage your money well and make sacrifices. The key is that if something sounds too good to be true, it usually is. There are no shortcuts or easy options that can get you there in a short amount of time.

If you’re already in your 40s and haven’t begun saving yet, do not worry. The important thing is that now is the time to start saving as much as possible so that by the time you reach 50 years old — or even sooner — you’ll have enough for whatever life throws at you after work.

Related: 17 Habits of Self-Made Millionaires Who Retired Early

Here are the actionable steps you’ll need to help you reach your goal:

1. Estimate how much you’ll need to retire

The amount of money you’ll need to retire comfortably at age 50 will depend on various factors, including your lifestyle and the cost of living in the area where you plan to retire. Start by calculating how much income you will need each month during retirement.

You can calculate how much you can safely withdraw each year by using the 4% rule. This rule is based on historical returns of the S&P 500, as well as inflation data and other factors. It isn’t a guarantee, but it’s a good rule of thumb for how much money to take out of your savings in retirement.

To calculate your safe withdrawal rate, multiply the size of your savings by 0.04 (4%). That figure represents the amount you should withdraw each year once you retire if you want to maintain the same purchasing power throughout your life without needing more income from working or other sources. For example: If you’re 40 years old with $200,000 in savings, then multiplying $200,000 by .04 results in an annual withdrawal of $8,000 per year — a pretty solid number for a beginning retiree.

Related: Want to Retire Early? Do This One Thing.

2. Create a financial plan

The next step towards retiring early is to create a comprehensive financial plan that outlines your income and expenses, debts, investments and long-term retirement goals. This will help you figure out how much money you need to save to reach your goal of retiring at 50.

Take into account other sources of income that could supplement savings, such as rental properties, passive income or inheritances and factor them into your plan as well. Also, consider potential future expenses like educational tuition and healthcare costs. Estimate how much you will need for each expense and include them in the calculations for total retirement savings.

3. Make saving a priority

Once you know how much money you’ll need, work backward to figure out how much you need to save to reach your goal. There are two main types of savings: emergency savings (“rainy day” funds) and investment funds (like retirement plans). Emergency savings should be kept in a safe place where they can’t be stolen or lost if something goes wrong with your bank account — for example, a high-yield online bank account or cash under your mattress at home. This money is for unexpected expenses like medical bills or travel expenses that pop up when you least expect them.

Determine how much you can contribute towards retirement, taking into account any employer match programs or tax incentives that may be available. You should prioritize saving for retirement by setting aside money each month into savings or investment accounts such as IRAs or 401(k)s. Consider increasing the contribution rates you have set for yourself and make sure that you are taking full advantage of employer contributions. Also, be sure to research the options available and choose the most appropriate for your current financial situation.

4. Reduce your expenses

Cutting down on luxury expenses and other non-essential items will help you save more monthly money, which can be used towards retirement savings. Consider reducing eating out, getting ride shares instead of owning a car or eliminating expensive gym memberships if possible.

Related: 4 Things You Need to Think About Before You Retire Early

5. Clear your debt

Paying down any outstanding debt should be high on your list of priorities; high-interest rates can drastically reduce potential savings if left unchecked, so focus on paying them off quickly while still investing regularly for retirement goals. Make sure you understand all the terms associated with each loan before signing anything — this includes knowing exact payments amounts, interest rates and length of repayment periods — this will ensure that you won’t get caught off guard by unexpected fees down the line if you ever find yourself unable to make payments on time due to an emergency or other unforeseen circumstance.

Related: 5 Strategies for Reducing Overall Business Debt

6. Invest wisely

When investing for retirement, it’s important to have a diversified portfolio that contains a mix of stocks, bonds, mutual funds and cash investments. You should also be mindful of risk tolerance and ensure that your chosen investments match your personal goals and objectives. Investing in low-cost indexes or mutual funds is one of the best ways to grow your wealth over time. Ensure you consider inflation when investing so you don’t get left behind as prices rise over time.

Diversifying your investments is the best way to protect yourself against a downturn in the market. This means spreading your money across multiple asset classes, such as stocks, bonds and cash.

But diversification isn’t a magic bullet. It’s important to remember that even if you’re diversified across all three of these categories, you will still lose money as some assets fall and others rise. Historically speaking, in some years, no single category performs particularly well or poorly at all; it’s just that they tend to move together overall based on market conditions over time.

7. Set up a budget

A good way to stay on track with retirement savings is to create a budget and stick to it. Track your expenses, set financial goals and review your progress regularly. Doing so will help ensure that you meet your retirement savings goals while maintaining a comfortable lifestyle.

Related: How to Become a Millionaire and Retire Young

8. Reevaluate regularly

Track progress throughout your working life; consider increasing savings rate if possible or revise goals if circumstances have changed unexpectedly due to an emergency situation or other unforeseen event.

Retiring by age 50 is an ambitious goal, but it can be achieved with the right plan and dedication. By creating a comprehensive financial plan that outlines your income and expenses, reducing non-essential items from your budget and investing wisely, you will be able to reach this milestone. While it may take some time for all of these steps to come together, taking the first step towards retirement planning today will put you on track for achieving financial freedom at a younger age than most people are used to. So start preparing now!

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OpenAI Rolls Out New Tool to Combat ChatGPT Plagiarism

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Since its launch in November, ChatGPT has disrupted various industries — from real estate to law. However, in the context of academia, teachers have growing concerns about whether using the tool is considered cheating.

ChatGPT, created by artificial intelligence company OpenAI, has the power to create essays, poetry, draft legal documents and more when given a prompt. While the results may need some editing, the tool’s efficiency has garnered worldwide attention for its accuracy.

Related: Professionals In This Industry Already Can’t Imagine Life Without ChatGPT: ‘I Can’t Remember the Last Time Something Has Wowed Me This Much.’

Public schools in Seattle and New York City have already banned the use of the tool over cheating concerns and its power to disrupt genuine learning. Now, OpenAI has announced a new feature that may help teachers spot the presence of ChatGPT in essays and other assignments, CNN reported.

The feature, called “AI text classifier,” is similar to the plagiarism software Turnitin in that when submitting a body of text, the tool will rate the input on a scale ranging from “likely generated by AI” to “very unlikely.”

While educators have been longing for such a tool to combat the increasing use of ChatGPT, OpenAI has admitted that the new feature is “imperfect” and should be “taken with a grain of salt,” CNN reported.

“We really don’t recommend taking this tool in isolation because we know that it can be wrong and will be wrong at times – much like using AI for any kind of assessment purposes,” Lama Ahmad, policy research director at OpenAI, told the outlet. “We are emphasizing how important it is to keep a human in the loop … and that it’s just one data point among many others.”

Related: Princeton Student Builds ChatGPT Detection App to Fight AI Plagiarism

Despite the imperfection of the new feature, OpenAI told CNN that the decision to release the “AI text classifier” has to do with hopefully deterring individuals from claiming AI text was composed by a human, as well as addressing the question of whether humans have a right to know if they are interacting with artificial intelligence.

“This question is much bigger than what we are doing here; society as a whole has to grapple with that question,” Jan Leike, a lead on the OpenAI alignment team, told CNN.

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Why All of Us Need to Join the Fight for Workplace Diversity

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The Ernst & Young 2020 Global Private Equity Report found that 74% of private equity firms under $2.5 billion did not have set targets for ethnic diversity and had no plans to set any.

While this might come as a surprise to those with no history working in private equity or hedge funds, this statistic and the recent media attention Soo Kim has received regarding the TEGNA takeover, unfortunately, come as no surprise to me.

As a former employee of Standard General, one of only a handful of Black Americans working in the hedge fund sector and an immigrant founder, I’m appalled at the lack of diversity in this space. However, I can firmly say that it would be a lot worse without Soo Kim’s contribution — but we need more than just him to join the cause.

Related: 18 Business Leaders on Creating an Inclusive and Equitable Society

What’s happening with Soo Kim’s TEGNA takeover?

In February 2022, Soo Kim’s Standard General, with funding from Apollo Global Management announced a deal to acquire TV station owner TEGNA for roughly $8.6 billion. TEGNA is the second-largest local TV broadcaster by revenue, operating 64 TV stations and two radio stations across various markets in the U.S. Contrary to large TV consolidation mergers, this particular deal has drawn a number of vocal objectors.

Ostensibly, the critique has come from a union — The NewsGuild — that purports to be concerned about jobs, despite the public commitments that Standard General made to preserve local station employment. While concerns about jobs are admirable, the publicly filed comments from these groups include statements that, in so many words, say that Soo Kim’s ownership of this station group would do nothing to advance diversity as understood by the civil rights community and public interest.

Is there a “wrong” type of minority?

These commenters continue to say that Soo Kim was not barred by his race from becoming a successful entrepreneur.

As a fellow New Yorker and both graduates of Stuyvesant High School, I can speak to our experiences. Using his Asian ancestry against him is exactly the kind of short-sighted hateful rhetoric causing so many issues for Asian communities across America. I have seen this in all aspects of American life, from Wall Street firms to my days at West Point and in Baghdad.

When there’s a flag draped over your coffin, there is no “wrong type of minority.” Yet we seem to treat immigrant founders and founders of color like there is such a thing as a “wrong” type of minority.

The indivisible nature of the United States is our greatest strength, but that strength is weakened by the belief that Soo Kim being Asian makes him unqualified to pursue the commercial principles that our country was founded on.

However, what worries me more than anything is that Kim hasn’t been treated fairly by anyone throughout this deal. Are these political letters and criticism influencing the regulators whose judgment the closing of this deal depends on? I know firsthand how hard it is for founders of color to access the capital to pull off deals of this magnitude. An adverse outcome here would have a chilling impact on minority ownership of broadcasting assets at the very least. Perhaps this is what the objectors want.

While the thought of that is troubling at the very least, I believe what’s been so impactful and appalling to me throughout this entire debacle has been the fact that I know Soo Kim. I’ve worked with him, I have represented him on public company boards and I’ve seen what he stands for. It’s unimaginable to me that he could be on the receiving end of such racism when he so clearly stands for justice and equality.

Related: 6 Ways to Offer Allyship to Black Entrepreneurs

Commitment to diversity

As the founder of Standard General, Kim has been tireless in his commitment to diversity: from hiring to using his power to change companies to better reflect what America really looks like. More importantly, he didn’t limit his search to just Asian professionals. Black, Asian, Jewish and white employees all were represented in the 12-person team at Standard General while I was there. He has also consistently appointed women and people of color to the boards of his companies throughout the years.

I have seen the good he does in his companies and how hard he works to provide equal access to opportunities regardless of race or gender.

And, because I am the diversity and inclusion officer for the MediaCo board of directors, which owns the radio stations Hot 97 and WBLS (which has a management team that is over 50% diverse and a staff that is over 70% diverse overall), I would say that it is precisely Kim’s unique background that could help improve TEGNA own documented diversity issues.

If other leaders follow Kim’s lead, we can slowly but surely change the diversity problem. But we all have to actually commit.

How the TEGNA deal compares to other acquisitions

Just to drive my point home, I believe it’s important to take a look at how this TEGNA deal compares to other similar acquisitions.

Recently, the TV industry has seen a surge in big deals. For example, Gray Television acquired Meredith’s and Quincy’s local stations with virtually no opposition from across the aisle. Scripps bought ION Media Group and Nexstar Media Group also added to its empire by snatching up Tribune Broadcasting — moves that heavily concentrated power in this industry space.

All of those prior deals did not face any of the scrutiny and criticism from this deal, which is curious because the TEGNA deal shrinks the company with the concurrent sale of a number of stations to Cox Media Group, and does not require any statutory divestitures or regulatory rule waivers as each of the above did. And yet, with Standard General’s deal, the informal 180-day “shot clock” for a regulatory decision has long passed.

The point? The lack of opposition to other similar deals shows young entrepreneurs and immigrant founders that even when you try to play fair as a person of color in this industry, you just can’t seem to win.

Related: 5 Ways Entrepreneurs of Color Can Determine an Ally’s Authenticity

The system has to change

In one interview, Kim said that after the takeover, TEGNA would get a “company with a minority owner, run by a woman, that’s committed to serving diverse communities. We think that’s good business.”

It is good business, and I am delighted to see that Kim and Standard Media CEO Deb McDermott have received letters of support from legislators, civil rights groups and minority media groups. I applaud these groups for speaking up in defense of Soo Kim and other minorities in this space. I, too, am doing my part to speak up against these racist attacks. However, that isn’t enough anymore.

The system has to change — and it changes by not allowing these types of attacks, comments and ideals to persist in any way, shape or form. We must stop entertaining the idea that these types of comments are valid or even acceptable. We have as a nation all experienced the heartache of watching videos of racially motivated violence against people of color from all walks of life. Racial oppression takes place in the business world just as it does in the streets, just without the same visible evidence but the same indelible impact on those persons of color involved.

As a business leader, here’s how you can enact systemic change:

  1. When making hiring decisions, stop going with your gut. Newsflash, your gut always leads you to the most comfortable choice. Instead, create a list of metrics you will hire for and focus on hiring someone that meets those metrics. Blind auditions eliminated discrimination in the world’s greatest orchestras. Imagine what it could do for your business.
  2. Be aware that there are challenges diverse individuals face in business that you don’t see or experience. Do your best to factor those in when evaluating candidates. They may not have Goldman Sachs on their resume, but can you see evidence of ability in past academic performance or in other areas like military or community service?

As the great Martin Luther King Jr. said, “An injustice anywhere is a threat to justice everywhere.”

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Better Chip Stock in 2023: AMD vs. STM

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While the last year has been challenging for the chip makers, the outlook for the industry is improving. Moreover, lucrative government initiatives are expected to strengthen the industry further. So, quality stocks Advanced Micro Devices (AMD) and STMicroelectronics (STM) could witness stable growth. But which is the better buy in 2023? Let’s find out.

The semiconductor industry witnessed significant supply chain disruptions in 2022. However, according to Peter Voser, the chairman of Swedish-Swiss tech and engineering giant ABB, the global shortage of semiconductors is expected to ease this year.

Moreover, the CHIPS Act is expected to bolster the industry further. It allocates $52.70 billion for American semiconductor research, development, manufacturing, and workforce development. Lucrative federal investments are expected to help the semiconductor industry thrive in the upcoming terms. The global semiconductor industry is projected to grow at a CAGR of 7% until 2030.

Therefore, quality stocks Advanced Micro Devices, Inc. (AMD) and STMicroelectronics N.V. (STM) are expected to gain significantly. AMD and STM are popular chip makers operating globally.

AMD has gained 16% over the past month, while STM has gained 32.8%. Also, AMD has lost 20.5% over the past three months, while STM has gained 24.5%.

Which stock is a buy? Let’s find out.

Latest Developments

On December 1, 2022, AMD and Viettel High Tech (Member of Viettel Group) announced the successful completion of a 5G mobile network field trial deployment. This collaboration for advanced 5G connection deployment is expected to be strategically beneficial for both companies.

On the other hand, on January 30, 2023, STM launched the world’s first MCU Edge-AI Developer Cloud.

Ricardo De Sa Earp, Executive Vice President of General-Purpose Microcontroller Sub-Group, STM, said, “Our goal is to deliver the best hardware, software, and services to meet the challenges faced by embedded developers and data scientists so that they can develop their edge AI application faster and with less hassle.”

Recent Financial Results

AMD’s revenue came in at $5.60 billion for the fourth quarter that ended December 31, 2022, up 16% year-over-year. However, its non-GAAP operating income came in at $1.26 billion, down 5% year-over-year. Also, its non-GAAP net income decreased marginally year-over-year to $1.11 billion, while its non-GAAP EPS decreased 25% year-over-year to $0.69.

On the other hand, STM’s net revenues came in at $4.42 billion for the quarter that ended December 31, 2022, up 24.4% year-over-year. Its net income increased 66.6% year-over-year to $1.25 billion, while its EPS increased 61% year-over-year to $1.32.

Past and Expected Financial Performance

AMD’s revenue is expected to increase 5.1% year-over-year to $24.71 billion for the current fiscal year 2023, while its EPS is expected to increase 2% year-over-year to $3.58 for the same period. Moreover, its EPS is expected to rise 14.3% per annum for the next five years. Also, it surpassed EPS estimates in three of four trailing quarters.

On the other hand, STM’s revenue is expected to increase 6% year-over-year to $17.10 billion for the fiscal year 2023 and 4.8% year-over-year to $17.92 billion for the next fiscal year 2024. Its EPS is expected to increase 7.7% year-over-year to $4.36 in 2024. Moreover, its EPS is expected to rise 5% per annum for the next five years. In addition, it surpassed EPS estimates in all four trailing quarters.

Profitability

AMD’s gross profit margin of 50.95% is higher than STM’s 47.34%. However, AMD’s EBITDA and net income margins of 24.30% and 9.96% are lower than STM’s 34.76% and 24.55%, respectively. Also, AMD’s ROE, ROA, and ROTC of 7.37%, 2.26%, and 5.72% are lower than STM’s 36.00%, 20.34%, and 20.13%, respectively.

Valuation

In terms of forward EV/Sales, AMD’s 4.85x is higher than STM’s 2.41x. Its forward EV/EBITDA of 14.93x is 114.8% higher than STM’s 6.95x. Furthermore, AMD’s forward P/E of 66.92x compares with STM’s 11.06x.

Thus, STM is relatively more affordable.

POWR Ratings

STM has an overall rating of A, equating to Strong Buy in our proprietary POWR Ratings system. On the other hand, AMD has an overall rating of D, which translates to Sell. The POWR Ratings are calculated considering 118 different factors, with each factor weighted to an optimal degree.

STM has a B grade for Quality. Its trailing-12-month CAPEX/Sales of 19.57% is 679.5% higher than the industry average of 2.51%.

On the other hand, AMD has a D grade for Quality. Its trailing-12-month CAPEX/Sales of 1.80% is lower than the industry average.

In addition, STM has a C grade for Stability, in sync with its beta of 1.30. On the other hand, AMD has an F grade for Stability, with its beta of 1.98.

Of the 92-stock Semiconductor & Wireless Chip industry, STM is ranked #2, while AMD is ranked #88.

Beyond what we’ve stated above, we have also rated the stocks for Growth, Value, Momentum, and Sentiment. Click here to view STM Ratings. Get all AMD ratings here.

The Winner

The supply chain issues in the semiconductor industry are expected to ease this year, which should boost production. Given the steady prospects of the industry, quality stocks STM and AMD should benefit. However, STM’s better financials and attractive valuations make it the better buy here.

Our research shows that the odds of success increase when one invests in stocks with an Overall Rating of Strong Buy or Buy. View all the top-rated stocks in the Semiconductor & Wireless Chip industry here.

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STM shares rose $0.16 (+0.34%) in premarket trading Wednesday. Year-to-date, STM has gained 32.75%, versus a 6.29% rise in the benchmark S&P 500 index during the same period.


About the Author: Riddhima Chakraborty

Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master’s degree in economics, she helps investors make informed investment decisions through her insightful commentaries.

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