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      01-21-2020, 03:14 PM   #45
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Boy - they would really flip if they saw I was getting 8.00% on my 18mo CD's invested at a foreign national bank, wouldn't they?
Yes. Although my OCD did not appreciate (but did find it a bit curious) that while in almost all cases the range quoted went from low to high, it went from high to low in the 7-11 month category in the highlighted row. And I didn't like that.

I also found it curious that a greater than 13 month term but less than 18 months would earn less annualized than a 12 month term.

But yes, good rates and I know where you are referring to.
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      01-21-2020, 03:21 PM   #46
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Slightly, now. Thanks.
How about now?

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      01-21-2020, 03:55 PM   #47
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How about now?

Much better. I appreciate your efforts, late as they were in the day...
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      01-22-2020, 07:44 AM   #48
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Originally Posted by qba335i View Post
4% and you will have some principal risk.. short term rates are 1.5%-1.8%. Anything more you take credit risk, duration risk...
Unless you're 65+, your definition of ”low risk” should not be 100% government bonds.
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      01-22-2020, 10:01 AM   #49
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https://prosperion.us/commentary/mee...-market-timer/

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Did you invest some money on Jan. 26th? Do you ever feel “the curse” of investing at exactly the wrong point? Like your investing is too late, at the wrong time, or maybe that you’re just unlucky?

Well meet Bob – the World’s Worst Market Timer. Bob began his working career in 1970 at age 22 and was a diligent saver and planner.


His plan was to save $2,000 a year during the 1970’s, then increase his savings by $2,000 each decade. In other words $2,000/year in the 70’s, $4,000/yr in the 80’s, $6,000/year in the 90’s… you get the picture.

Bob started in 1970 with $2,000, added $2,000 in ’71 and ’72, then decided to take the plunge and invest in the S&P 500 at the end of 1972. (Time out: there were no index funds in 1972, but come along with me for illustration purposes).

Now in 1973 – 74, the S&P dropped by nearly 50%. Bob had invested his life savings at the peak, just before it fell in half! Bob was bummed, but Bob had a plan and he was sticking to it. You see Bob never sold his shares. He didn’t want to be wrong twice by investing at the peak and then selling when prices were low. Smart move Bob!

So Bob kept saving $2k/year in the 70’s and then $4k/yr in the 80’s. But he was feeling the sting of his last investment and did not feel comfortable adding to his fund until he had seen the markets rise a fair amount. In August of 1987 Bob decided to put 15 years of his savings to work. Seriously Bob?

This time the market fell more than 30% right after Bob invested. Bob, amazed at his investing prowess, did not sell.

After the 1987 crash, Bob was really planning to wait it out. In the late 1990s everything was on fire. The internet was unbelievable new technology and stocks were flying high. By 1999 Bob had accumulated $68,000 from saving each year. A firm believer that the Y2K bug was boloney, Bob invested his cash in December 1999 just before a 50% decline that lasted until 2002.

The next buy decision in October 2007 would be one more big investment before he would retire. He had saved up $64,000 since 2000, deciding to invest this right before the financial crisis that saw Bob experience another 50% decline. Monkey’s throwing darts were probably better at investing than Bob.

Distraught and disheartened, Bob continued to save each year and accumulated another $40k. He kept his investments in the market until he retired at the end of 2013.

So let’s recap: Bob is definitely has “bad timing”, only investing at market peaks just before severe market declines. Here are the purchase dates, subsequent declines and the amounts Bob invested:

Date of Investment

Subsequent Crash

Amount Invested

December 1972

-48%

$6,000

August 1987

-34%

$46,000

December 1999

-49%

$68,000

October 2007

-52%

$64,000

Total Invested

$184,000

Fortunately Bob was a good saver, and actually a good investor. You see once he made his investment he considered it to be a long-term commitment and never sold his shares. Even the Bear Market of the 70’s, Black Monday in 1987, the Tech Bubble or the Financial Crisis did not cause him to sell or “get out” of the market.

He never sold a single share. So how did he do?

Bob almost fell out of his chair when his advisor told him he was a millionaire! Even though Bob made every single investment at the peak, he still ended up with $1.1M! How you might ask? Bob actually had what we would call “Good Investor Behavior”.

First, Bob was a diligent and consistent saver. He never waivered from his savings plan (recall $2k/year in the 70’s, $4k in the 80’s, $6k in the 90’s, $8k in the 2000’s, $10k in the 2010’s until his retirement in 2013 at age 65).

Second, Bob allowed his investments to compound through the decades, never selling out of the market over his +40 years of investing – his working career.

During that time Bob endured tremendous psychological toil from seeing huge losses accumulate right after he made each investment. But Bob had a long-term perspective and was willing to stick with his savings and investment plan – even if his timing was “a bit off”. He saved and kept his head down.

Certainly you realize Bob is an illustration. We would never advise only investing in a single strategy, let alone a single investment like an index fund. If Bob had invested systematically, the same amount each month, increasing his savings like he did he would have ended up with even more money, (over $2.3M) – but that would not have been Bob, the Worlds Worst Market Timer.

So what are the lessons?

If you are going to invest, invest with an optimistic outlook. Long-Term thinking often rewards the optimist. Unless you think the world is coming to an end, optimists are typically rewarded.
Temporary, short-term losses are part of the deal when you invest. How you react to those losses will be one of the biggest determinants of your investment performance.
The biggest factor in investment success is savings. How much you save, and how methodically you save has a much bigger impact than investment return.
Get these three things right along with a disciplined investment strategy and you should do well. Even Bob did well. Nice work Bob.
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      01-22-2020, 10:08 AM   #50
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Tons of ppl i know pulled out 1st and 2nd quarter of last year (2019) bec of recession speculation, China trade war etc.

Nobody truly knows what will happen and nobody can time the market. Make sure you have liquid funds (cash) to support 12-24 months of living expenses. Everything else should be invested.
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      01-22-2020, 10:08 AM   #51
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Originally Posted by DriverDaily View Post
Quote:
Originally Posted by qba335i View Post
4% and you will have some principal risk.. short term rates are 1.5%-1.8%. Anything more you take credit risk, duration risk...
Unless you're 65+, your definition of ”low risk” should not be 100% government bonds.
Low risk assets are low risk assets. The ability and willingness to assume risk is a totally different thing.
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      01-22-2020, 03:00 PM   #52
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Originally Posted by XutvJet View Post
How old are you and how long have you been in the market?

Retirement wise, is your net worth on track for someone your age (30s = $300-400K, 40s = $500-700K, 50s = $700K-1.3M)?

When you talk about this 39% gain in the past 2 years, is this 4 figures, 5 figures, 6 figures?

What were these investments in? Stocks? Funds?

Do you have any other investment/retirement accounts? If so, how well are they funded?


So Im 34, i have about 500k in assets, that's 100k cash, 250k house equity, and 200k in 401k. And im a slum lord in north western CT, though this is more of a liability then an asset time has proven

I have been maxing out my 401k for last 4 years. These gains were strictly from blue chip fund gains.

As far as other accounts i do not. But i dont think I'm doing to poorly for my age.

Oh yeah i drive an ///m car which we all know is the true measure of financial success
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      01-22-2020, 03:16 PM   #53
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Originally Posted by qba335i View Post
Low risk assets are low risk assets. The ability and willingness to assume risk is a totally different thing.
1.5%-1.8% is not low risk, it's the risk free rate. And it doesn't get much more subjective than using words like "low," "medium," and "high." If you say you want "low risk" your investment advisor is not going to come back with a 100% t-bill portfolio unless you are also retired.
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      01-22-2020, 03:30 PM   #54
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Be like Bob.
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      01-22-2020, 03:50 PM   #55
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Be like Bob.
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      01-22-2020, 03:53 PM   #56
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Be like Bob.
^ This.
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      01-22-2020, 03:59 PM   #57
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Originally Posted by bimmerfrk View Post
So Im 34, i have about 500k in assets, that's 100k cash, 250k house equity, and 200k in 401k. And im a slum lord in north western CT, though this is more of a liability then an asset time has proven

I have been maxing out my 401k for last 4 years. These gains were strictly from blue chip fund gains.

As far as other accounts i do not. But i dont think I'm doing to poorly for my age.

Oh yeah i drive an ///m car which we all know is the true measure of financial success

Sounds like you're doing ok. I say ok because you do live in a pricey part of the country and you didn't provide your net worth, just your assets. Regardless, you're still ahead of the majority for you're age assuming you're not carrying some huge note on a home in a terrible area. Maxing your 401K is a solid choice assuming you've got good investment options, the match is good, etc. I'd definitely look into other investment options too like a Roth, brokerage, etc.

I do agree that a correction is coming in the near future (i.e. sometime between next week and deep into 2021 ), but you're young. You have lots of time to make back losses. You will get lit up in the investment world. That's inevitable. You'll have a few big losses followed by a lot HUGE gains assuming you're well invested and smart. As others have noted, timing the market is crazy difficult. I've lost massive sums of money over the past 25 years in the market. However, I never sold during the crashes and stuck to my plan. The only things that changed was that I wised up with the things I was invested in.

I'm 45 and I'm well aware that I'll likely lose 20-30%, maybe worse, of my portfolio's value sometime in the next 2 years. I also know that in the 2 to 5 years following I'll make back all of it plus another huge sum. The only thing I'm doing in preparation to ease the pain is that I plan to sell a small portion of my portfolio in the near future and the proceeds will then serve as my "war chest" when the market tumbles so that I can purchase blue chips and similar at highly disconnected prices.

My Roth, company 401k, traditional IRA, and brokerage account are heavily invested in S&P 500 index funds (~65%) and ~15% in Berkshire Class B and the remainder in a handful of bond, money, small cap funds, and random stocks (for fun). It's done extremely well for me over the years.
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      01-22-2020, 04:55 PM   #58
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Originally Posted by XutvJet View Post
Quote:
Originally Posted by bimmerfrk View Post
So Im 34, i have about 500k in assets, that's 100k cash, 250k house equity, and 200k in 401k. And im a slum lord in north western CT, though this is more of a liability then an asset time has proven

I have been maxing out my 401k for last 4 years. These gains were strictly from blue chip fund gains.

As far as other accounts i do not. But i dont think I'm doing to poorly for my age.

Oh yeah i drive an ///m car which we all know is the true measure of financial success

Sounds like you're doing ok. I say ok because you do live in a pricey part of the country and you didn't provide your net worth, just your assets. Regardless, you're still ahead of the majority for you're age assuming you're not carrying some huge note on a home in a terrible area. Maxing your 401K is a solid choice assuming you've got good investment options, the match is good, etc. I'd definitely look into other investment options too like a Roth, brokerage, etc.

I do agree that a correction is coming in the near future (i.e. between next and sometime in 2021), but you're young. You have lots of time to make back losses. You will get lit up in the investment world That's inevitable. You'll have a few big losses followed by a lot HUGE gains assuming you're well invested and smart. As others have noted, timing the market is crazy difficult. I've lost massive sums of money over the past 25 years in the market. However, I never sold during the crashes and stuck to my plan. The only things that changed was that I wised up with the things I was invested in.

I'm 45 and I'm well aware that I'll likely lose 20-30%, maybe worse, of my portfolio's value sometime in the next 2 years. I also know that in the 2 to 5 years following I'll make back all of it plus another huge sum. The only thing I'm doing in preparation to ease the pain is that I plan to sell a small portion of my portfolio in the near future and the proceeds will then serve as my "war chest" when the market tumbles so that I can purchase blue chips and similar at highly disconnected prices.

My Roth, company 401k, traditional IRA, and brokerage account are heavily invested in S&P 500 index funds (~65%) and ~15% in Berkshire Class B and the remainder in a handful of bond, money, small cap funds, and random stocks (for fun). It's done extremely well for me over the years.
I don't have any except for the note on my house. It's roughly a 750 note in a nice favorable town in jersey. Most houses are in the median range of 900k to 1.2mil and I have over 200k in equity.

The misses and I bring in roughly 310k a year. So I'm not concerned about the note unless I kick the bucket since I earn 2 thirds of the annual income. Other than that just basic debt some credit under 10k and vehicle payments and lease payments.
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      01-22-2020, 06:20 PM   #59
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Quote:
Originally Posted by XutvJet View Post
How old are you and how long have you been in the market?

Retirement wise, is your net worth on track for someone your age (30s = $300-400K, 40s = $500-700K, 50s = $700K-1.3M)?

When you talk about this 39% gain in the past 2 years, is this 4 figures, 5 figures, 6 figures?

What were these investments in? Stocks? Funds?

Do you have any other investment/retirement accounts? If so, how well are they funded?
Interesting goal/age information. Is there more background on this? A link or website to learn more?
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      01-22-2020, 06:49 PM   #60
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Op, how many years until retirement?
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      01-22-2020, 07:35 PM   #61
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1.5%-1.8% is not low risk, it's the risk free rate. And it doesn't get much more subjective than using words like "low," "medium," and "high." If you say you want "low risk" your investment advisor is not going to come back with a 100% t-bill portfolio unless you are also retired.
High yield, even when bundled to achieve some diversification, is not low risk. Low risk would be more like investment grade, where there is a spread over risk free, but less risk than high yield.
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      01-22-2020, 10:13 PM   #62
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Originally Posted by XutvJet View Post
Sounds like you're doing ok. I say ok because you do live in a pricey part of the country and you didn't provide your net worth, just your assets. Regardless, you're still ahead of the majority for you're age assuming you're not carrying some huge note on a home in a terrible area. Maxing your 401K is a solid choice assuming you've got good investment options, the match is good, etc. I'd definitely look into other investment options too like a Roth, brokerage, etc.

I do agree that a correction is coming in the near future (i.e. sometime between next week and deep into 2021 ), but you're young. You have lots of time to make back losses. You will get lit up in the investment world. That's inevitable. You'll have a few big losses followed by a lot HUGE gains assuming you're well invested and smart. As others have noted, timing the market is crazy difficult. I've lost massive sums of money over the past 25 years in the market. However, I never sold during the crashes and stuck to my plan. The only things that changed was that I wised up with the things I was invested in.

I'm 45 and I'm well aware that I'll likely lose 20-30%, maybe worse, of my portfolio's value sometime in the next 2 years. I also know that in the 2 to 5 years following I'll make back all of it plus another huge sum. The only thing I'm doing in preparation to ease the pain is that I plan to sell a small portion of my portfolio in the near future and the proceeds will then serve as my "war chest" when the market tumbles so that I can purchase blue chips and similar at highly disconnected prices.

My Roth, company 401k, traditional IRA, and brokerage account are heavily invested in S&P 500 index funds (~65%) and ~15% in Berkshire Class B and the remainder in a handful of bond, money, small cap funds, and random stocks (for fun). It's done extremely well for me over the years.

That's exactly what my dad does. Most of his money is still in the market but he has a small amount in cash for that reason.
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      01-22-2020, 10:19 PM   #63
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Quote:
Originally Posted by bimmerfrk View Post
So Im 34, i have about 500k in assets, that's 100k cash, 250k house equity, and 200k in 401k. And im a slum lord in north western CT, though this is more of a liability then an asset time has proven

I have been maxing out my 401k for last 4 years. These gains were strictly from blue chip fund gains.

As far as other accounts i do not. But i dont think I'm doing to poorly for my age.

Oh yeah i drive an ///m car which we all know is the true measure of financial success
I wouldn't consider home equity as part of your investment portfolio.

You're doing pretty good (better than the average American for sure but that's not really saying much) but I'd definitely be maxing out a Roth IRA via backdoor Roth for both you and your wife if I were you. Silly to not take advantage of all that is available to you.
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      01-23-2020, 09:53 AM   #64
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I wouldn't consider home equity as part of your investment portfolio.

You're doing pretty good (better than the average American for sure but that's not really saying much) but I'd definitely be maxing out a Roth IRA via backdoor Roth for both you and your wife if I were you. Silly to not take advantage of all that is available to you.
Whats the back door? Not aware of this. I'm not eligible for Roth IRA we make way to much money according to uncle Sam.
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      01-23-2020, 09:54 AM   #65
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Op, how many years until retirement?
I'm 34 but i hoping to be able to retire early. Or at least work only part time after my mid 50s. i know hard to realize but we can dream cant we.
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      01-23-2020, 09:56 AM   #66
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I wouldn't consider home equity as part of your investment portfolio.

You're doing pretty good (better than the average American for sure but that's not really saying much) but I'd definitely be maxing out a Roth IRA via backdoor Roth for both you and your wife if I were you. Silly to not take advantage of all that is available to you.
Its not a home equity line. Thats how much my house is valued vs waht i own on the note. So if i sell i stand to make around 200k profit based on median comps. note is 750k house value is 1mil.
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