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Hello Fishes,
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Anyone knows about the base for chase PCA?
So the fiduciary rule got tossed yesterday
best resources for brushing up on excel?
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Understandable question! And a good one.
I think it really comes down to this: tomorrow isn’t promised. Nothing you do today can give you 100% assurance of what’s to come tomorrow. So instead of trying to plan things out to get a to 100% confidence, you go for what’s most likely to set me you and your family up for success, based on the best information, and most sound advice available.
So first, you need to define success. Then you need to focus on that vision, that goal, over what’s going on in the now.
If success for you is maintaining or increasing your current standard of living into retirement, and providing your kids with money for education, and making sure your spouse and kids are set once you leave - game plan it out, dollars and cents, can you do that just by saving the way you are, and not investing? Keeping in mind that the long term inflation goal of the fed is 2%. (Hint - you probably need to save more & invest!)
I will say, I’ve never heard a single person get to retirement and say, “man, I really did start investing too early” or, “dang, I really wish I just kept my savings locked in a safety deposit box.”
Now, it may not be right for everyone (yes it is, that’s just something we say), really evaluate your long term projections and come to a decision that you are comfortable with. What kind of returns do you need to aim for, in order to get where you’re going.
If you don’t know where you’re going, no matter what direction you turn, you’ll always feel lost.
You spend $10k on a car knowing you could crash it and lose $. You spend $50 on a steak dinner knowing it’s going in the toilet. You spend $500 on a flight which you’ll never get back. It doesn’t take courage, just perspective. You “lose” hard earned money every day. Investing is one of the few ways you might actually get more money back than you spend.
Well, it all depends what you are investing it. If it’s Bitcoin, Options, penny stocks or other speculative trades then yes, keep your hard earned cash. These kind of investments think of it as casino money that you are willing to lose since the downside risk and volatility is quite high. Other than that, pick strong companies you like and add on weakness. I’m a fan of cost averaging whether the stock goes up or down. Buying small(er) lots and adding more depending on your comfort level. Companies that you have a strong degree of certainty that they will do well or continue doing so.
The more speculative you get, the more risk you’re taking and the lesser % of your portfolio should be allocated to these kind of names.
Start slowly, get comfortable and DONT PANIC! Always buy (even if it is a tiny bit) when there’s blood in the street, even if it’s your own...again, on strong and solid companies.
If you don’t know what to buy, some will say buy an index ETF, specific sector ETFs where you have conviction. I believe in active management, whether it is your own or a good MF team. Not easy finds, but they do exist. Especially now, I truly believe stock picking will prevail vs passive. Hope this helps.
I came from a humble background to and that’s why I do invest. Find high quality mutual funds and dollar cost average. I look at cash as more risky then the market.
The market is a math number if you buy long term investments over time it is safer to me. Market averages 8% cash averages -(2-3) due to low interest rates and inflation.
Mentor
I think the folks above have already provided a lot of good advice. One thing I would add is to take a closer look at your savings, and figure out if you can carve out a bucket for investments, an amount that you dont need for everyday living expenses. If you can allocate a portion, then follow some of the advice above, find some good investments and dollar-cost average in. History is on your side, stocks will appreciate over time. It’s a mindset change to step out of cash, but you will feel more comfortable once you had some experience. Go slow, move at your own pace. Good luck.
Here’s something that helps me: you absolutely need to understand how much of your money can be earmarked for a multiple decade timeframe...once you are as concrete as possible with that, you understand that the biggest risk to your money over longer timeframes is likely the rising cost of living/inflation. Cash is the riskiest asset to “invest” in over long timeframes and the least risky for short timeframes. Equity assets like stocks and real estate, etc. are flip-flopped. Risky assets can easily lose half of their value in a very short amount of time, even if you diversify very broadly...therefore they are risky in that they can’t possibly be priced for all possible future scenarios and are often priced way too high or low for what future ultimately comes to pass...but if you own a bunch of little “cash machines” that turn $1 into $1.10 or $1.20 or $1.05, the bigger impact isn’t going to be whether you paid $1 for something that should have been priced at 50 cents or $2...or even whether earnings contract or expand($1 into $1.05 or $1.20)...it’s going to really matter more that you have something that will still be within 50% or so of the value you originally bought it for in real(inflation-adjusted) terms. So just think about cash as devaluing at 3% per year(which is maybe the last one hundred year average-though the last decade has only been around 1.6%)...this means that after every 24 years, you lose half of your wealth. If you are 25 years old...$1 might become worth 50 cents at age 49 and worth 25 cents at age 73 and worth only 16 cents at your death(using female life expectancy at age 25)...so you are very likely to lose 88% with cash versus at least preserving that $1(even if you make a lot of mistakes, as long as you avoid catastrophic mistakes)which would be worth $6.15 at merely 3% return...or worth closer to 64! times that if you can experience the long-term average real return of the US stock market over your lifetime (assuming 25 years old). So it sounds like you just need to reframe what risk means to you...perhaps you feel that 100% of your money needs to be worth every penny of it’s sticker value today even though you know that it is being silently whittled away in terms of what it can buy for you...but if that is not the case, you probably should own some ownership/equity types of assets. Intuitively, I think you know that the obvious disadvantages of the stock market must involve some sort of beneficial trade off or else nobody would do it...you just have to be really solid mentally to look at both risk AND benefit and decide that you are in a position to take X amount of risk. On the other side, human nature is to perceive risk to be lowest when it has recently seemed so...decency bias will have you not only deciding stocks aren’t as risky as a decade ago...but also larger stocks seem less risky than small...US less risky than foreign, etc, etc...many studies show people experience risk very dynamically and that simple risk tolerance questionnaires show people are most risk averse when risky assets have recently declined and most risk tolerant when risky assets have recently performed well. So from that standpoint it is also important to be self-aware and always strive to reach a balance...if you can try to take marginally more risk when everyone around you is losing their heads(and risky assets fall in value enough to make them less risky going forward) and vice versa. Before all of that, I think you should just think of your money as serving different timeframes and think about how much of those short and long term risks you need to take to reach your goals...a financial advisor or someone else you trust can help you discover what goals you should set for yourself and help to keep you accountable.
How old are you? You have got to get your money working for you so you won’t have to work so hard.
I might be a little harsh here, but if you don't beleive in what you do, how can you expect your clients to beleive in you?
I apologize, Deloitte. I didn't realize I saw non financial bowls or had non financial persons able to communicare in them.
Start slow and gain confidence or be willing to live more frugally and grow slow. Age has nothing to do with risk tolerance. You have to be able to sleep at night. Take the risk you are comfortable with.
Simple risk vs reward trade off. I could walk across the country or take a plane. Walking eliminates my risk of a car accident on the way to the airport, a plane crash, and possible weather delays. However, flying is a calculated risk that will provide much greater benefit so I’m willing to risk it. A bit over simplified but you get the idea. Sitting in cash puts you at risk of not having enough money to retire or enjoy things later in life. I’ll take the risk of investing when I’m young knowing the longer term benefit. Risk now vs risk later.