How to Retire Rich on $18K Per Month Salary Using DIA LEAPS

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Are you looking for a way to create a consistent income stream that can help you retire rich—on a monthly salary of $18,000 or more? If so, you may have heard of covered calls and LEAPS (Long-Term Equity Anticipation Securities), but what if you could generate significant cash flow with a strategy built around the Dow Jones Industrial Average (DIA)? In this post, we’ll break down how this method works and how it can be used to build wealth in retirement.

Mark, an expert in the stock market and author of the Cash Flow Machine program, explains how using DIA LEAPS in combination with covered calls can be an income-generating strategy that doesn’t require constant market monitoring.

What are DIA LEAPS and Covered Calls?

- DIA is an exchange-traded fund (ETF) that tracks the performance of the Dow Jones Industrial Average. It’s considered a relatively stable investment, ideal for those who want consistent growth without the volatility of tech stocks.

- LEAPS are long-term options that give you the right, but not the obligation, to buy the underlying ETF (in this case, DIA) at a specific price within a set time frame (typically a year or more).

- Covered Calls involve selling call options on an ETF or stock you already own. You collect premium income (the “juice”) from the sale of the call, while maintaining your position in the ETF.

The Strategy Explained

Mark’s method focuses on buying LEAPS on DIA and then selling covered calls against those LEAPS. The goal is not to hit big profits by betting on massive movements in the stock price, but to consistently collect premium income through covered calls.

- Step 1: Buying DIA LEAPS – First, you buy LEAPS on DIA, which allow you to control a large number of shares without having to spend the full amount to own the ETF outright. These options have a high Delta (in this case, 81), which means you will receive an 81% return on any movement in the underlying ETF.

- Step 2: Selling Covered Calls – After purchasing the LEAPS, you sell covered calls on those LEAPS. The goal here is to generate regular income from the premiums (the “juice”) you collect every time you sell a call option. In Mark's example, he earns approximately $615 per contract every two weeks by selling calls.

- Step 3: Rolling the Calls – Over time, you can roll these calls to different strike prices or expiration dates to keep generating income. This rolling process helps extend the income-generating strategy over months or even years.

Key Points to Remember

- Income Generation: The primary goal here is to create a steady income stream, with Mark’s strategy targeting $9840 every two weeks on an initial $81,300 investment.

- Rolling Calls: As the stock price moves up, you may need to roll your calls to higher strike prices, but you will still keep the premium income (“juice”) generated in the process.

- Risks and Adjustments: If the stock price moves too far in one direction (up or down), you may need to adjust your position. This may involve rolling your options or even selling your base position if you think it’s best to cut losses.

Life-Improving Tips

Start with the Right Market Conditions: The market is cyclical, and it’s important to buy during periods of pullbacks, when prices are low, and the market shows signs of stabilization.
Reinvest Your Earnings: Don’t just take your earnings and spend them—reinvest the premiums into your strategy or into other income-producing assets. This allows you to compound your wealth over time.
Plan for Adjustments: Part of successful covered call trading is knowing when and how to make adjustments. Be prepared to act when the market changes direction, but don’t make rash decisions.
Focus on the Long Term: While covered calls are a short-term strategy, when combined with LEAPS, this method is most effective for long-term wealth creation.

FAQs

Q: What’s the biggest risk with this strategy?

A: The primary risk comes from the volatility of the underlying ETF. If the price of DIA moves drastically either up or down, adjustments may be needed, and there’s a chance you could lose money. However, the strategy is designed to generate income over the long term, which helps mitigate these risks.

Q: How much capital do I need to get started?

A: To begin using DIA LEAPS and covered calls, you’d need to purchase the LEAPS contracts (which will cost around $5,100 each) and have enough capital to sell multiple covered calls. Mark’s example used 16 contracts, totaling $81,300, to generate a steady cash flow.

Q: Is this strategy suitable for someone looking to retire?

A: Yes, the goal of this strategy is to create consistent income, which is ideal for retirees looking for a reliable income stream. Mark’s example is designed for those who are looking for $18,000 per month in income.

Call to Action

If you’re interested in learning more about generating consistent income from the stock market, especially using strategies like covered calls and LEAPS, check out Mark’s Cash Flow Machine system. It offers a step-by-step guide on how to implement these strategies and build a long-term income stream that could help you retire on your terms.

Get started today

Conclusion

Retiring rich on a salary of $18,000 per month may sound impossible, but with the right strategy—like investing in DIA LEAPS and using covered calls—you can create a consistent income stream that can support your lifestyle well into retirement. While this method isn’t risk-free, it offers a practical and

hands-off way to generate cash flow with just a few hours of work per week. The key is consistency, education, and a long-term approach to wealth-building.

How to Retire Rich on $18K Per Month Salary Using DIA LEAPS

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