Investing 102

[GregWeld]

A quarter of a percent increase in mortgage rates deters no one.


Not to argue with you.... but you don't apparently understand the correlation of FED rates and the subsequent market rates that it affects.

A "quarter point" rise won't affect home sales could possibly be correct - except that real actual mortgage rates will go up MORE than that... and since the FED is talking about possibly raising rate FOUR TIMES this year - that would be ONE full point this year alone....

The FED FUNDS rate affects every single thing you do.... food prices - cost of doing business - cost of borrowing - credit card rates. What happens - eventually - your car payment goes up - your insurance costs go up - your food prices rise - and your mortgage payment rises. That creates INFLATION - which then causes businesses to have to increase their prices to cover the rising costs of everything they do... Rates are incredibly important.

[im4u2nvss]

This looks just like 12 years ago

This is exactly how my area feels.

[Vegas69]

It seems when things have been going well for quite some time I see these mindsets:

"I need to get in before it's too late."

"I need to get in because everybody else is doing it."

This can go against values and long term financial sense.

The more calculated will base decisions of facts and comfort levels. Rising rates may not deter the former in the short term, but it certainly could deter the latter.

[GregWeld]

I didn't want to copy and paste the whole article.....



https://www.cnbc.com/2018/02/28/pending-home-sales-drop-4-point-7-percent-to-lowest-point-in-nearly-4-years.html

[rustomatic]

Greg, the great research authority that is CNBC is definitely doing a good job of trying to show how things are looking a lot like 2006. The house I bought in 2006 (in Arkansas, not CA) came with a 6% interest rate. It wasn't a bad deal, even though the one I have now is at 4%. As the mortgage bubble burst, rates went up, along with gas prices and everything else; Priuses were being bought above market, and dealers in the Midwest were literally giving away Dodges and Chryslers (if you bought one). Everything's a pattern that can be found in the past (as your experience has undoubtedly demonstrated), short of trying to track Goldman Sachs' trading algorithms . . .

It would be interesting to see the world with the crazy interest rates from the late 1970s/early '80s. The thing about that would be a completely different economy . . .:drowninga:

Not to argue with you.... but you don't apparently understand the correlation of FED rates and the subsequent market rates that it affects.

A "quarter point" rise won't affect home sales could possibly be correct - except that real actual mortgage rates will go up MORE than that... and since the FED is talking about possibly raising rate FOUR TIMES this year - that would be ONE full point this year alone....

The FED FUNDS rate affects every single thing you do.... food prices - cost of doing business - cost of borrowing - credit card rates. What happens - eventually - your car payment goes up - your insurance costs go up - your food prices rise - and your mortgage payment rises. That creates INFLATION - which then causes businesses to have to increase their prices to cover the rising costs of everything they do... Rates are incredibly important.

[GregWeld]

Greg, the great research authority that is CNBC is definitely doing a good job of trying to show how things are looking a lot like 2006. The house I bought in 2006 (in Arkansas, not CA) came with a 6% interest rate. It wasn't a bad deal, even though the one I have now is at 4%. As the mortgage bubble burst, rates went up, along with gas prices and everything else; Priuses were being bought above market, and dealers in the Midwest were literally giving away Dodges and Chryslers (if you bought one). Everything's a pattern that can be found in the past (as your experience has undoubtedly demonstrated), short of trying to track Goldman Sachs' trading algorithms . . .

It would be interesting to see the world with the crazy interest rates from the late 1970s/early '80s. The thing about that would be a completely different economy . . .:drowninga:




I couldn't disagree more --- what they --- and including my personal team of bankers and hedge fund managers are saying ---- is to "keep a heads up". We are speaking in this particular forum thread about INVESTING 102.... which is information relating to being relatively new at investing - the relationships - the things that can cause ups and downs. It's not an advanced econ class.... that would be a different thread.

[GregWeld]

This is not a pitch to buy or sell or do anything --- it's just an investing 102 "thought"....


I've owned Altria (MO) for a very long time.... the reason I own it is not for the "current" dividend (in other words - if you bought it today). I own it for the CONSTANT dividend increases this particular stock produces. A couple days ago - they announced an increase to .70 per quarter. Doesn't seem like much does it? A lousy .04 per quarter.... BUT --- big Butt --- that's a 6% increase! So if inflation is running 3% - you just doubled that amount.

Now -- if you calculate YOUR dividend - at the price YOU paid.... this begins to be a serious cash cow. It takes TIME to have a relatively low paying (<5% currently) dividend stock become a cash cow - and not all companies increase their dividend payout annually -- but god bless MO -- they just keep pumping out the cash. If you're young - and this is in your IRA/401 - and that dividend is plowed back in to buying more shares (DRIP) -- when you get ready to retire in 20 years.... yeah - that's a nice holding.

[toy71camaro]

Had MO since I started in this thread several years ago. To elaborate more on your comment, I've seen the following yearly increases to the dividend:
2012: 7.32%
2013: 9.09%
2014: 8.33%
2015: 9.62%
2016: 7.02%
2017: 8.2%
2018: 6.06%

My current yield based on what I paid (and my drips): 6.96% :) Which translates from me getting 0.41 a share in 2012 to 0.70 now (well, soon). Nearly doubled!

I have a pretty nifty spreadsheet that tracks all this for my "investing 102" holdings thanks to all you guys. :hello:

[GregWeld]

Had MO since I started in this thread several years ago. To elaborate more on your comment, I've seen the following yearly increases to the dividend:
2012: 7.32%
2013: 9.09%
2014: 8.33%
2015: 9.62%
2016: 7.02%
2017: 8.2%
2018: 6.06%

My current yield based on what I paid (and my drips): 6.96% :) Which translates from me getting 0.41 a share in 2012 to 0.70 now (well, soon). Nearly doubled!

I have a pretty nifty spreadsheet that tracks all this for my "investing 102" holdings thanks to all you guys. :hello:





That is how people make money folks!


Think about a 20 or 25 year run like that...... you start when you're 40 and retire at 65 and the dividends just keep taking care of you... for another 25 years.


Or you can buy Bitcoin and have someone steal it from you.... LOL
You guys see the latest heist? $530 MILLION from another brokerage....

[glassman]

You guys see the latest heist? $530 MILLION from another brokerage....

So, speaking of which, WTH is CNBC showing a "bitcoin watch" window? Fascinating to them? just curious....

[GregWeld]

So, speaking of which, WTH is CNBC showing a "bitcoin watch" window? Fascinating to them? just curious....

Trying to get Millenials to watch for ratings??? IDK

I just find it hilarious that every week I read another story about theft or hacking etc with this stuff..... it was supposed to be "so secure".... RIGHT! So secure they can steal hundreds of millions worth every other week.... a couple times this has even caused the "brokerages" to go out of business. Let me know how that works out.

[Vegas69]

I heard a radio ad this week urging homeowner's to take out a home equity line to buy the "bitcoin dip". I about lost control of my truck. :D

[JKnight]

I heard a radio ad this week urging homeowner's to take out a home equity line to buy the "bitcoin dip". I about lost control of my truck. :D

I heard the same ad, started a couple weeks ago. All I can do is shake my head. You know there’s a handful of people who will think that’s a great idea and give them a call. They’re walking an ever-narrowing line on making investment recommendations too....no good.

[GregWeld]

I stole this fair and square ---- but it is well defined investment strategy....

So much of this thread has been about buying not selling.... buying when the poo hits the fan vs selling every time you hear some talking head saying the sky is falling. Holding great companies (think in that way versus "stock") and collecting part of your profits (since you are an owner in that company). I read this and thought I needed to copy and paste it here.

++++++++++++++++++++++++++


Memorize this affirmation: "I am an investor; I am not a speculator."

All together now: "I am an investor; I am not a speculator."

As investors, we:

Buy stock in solid businesses. We expect to be rewarded over time through share price appreciation, dividends, or share repurchases.
Don't time the market. And we certainly don't speculate when we buy stocks. Speculation is what day traders do.
Focus on the value of the businesses we invest in. We try not to fixate on the day-to-day movements in stock prices.
Buy to hold. We buy stocks with the intention of holding them for the long haul.
Tune out the noise: Put down the newspaper, turn off CNBC, and opt out of those alerts on your phone. None of it is doing you any good.

Fixating on the market's minute-to-minute news won't help you make your next brilliant financial move. That chatter is mostly noise. And it's costing you a serious amount of sound sleep — and maybe even some actual money.

Spread out your risk with a solid asset-allocation plan.

You should be building a portfolio (or working toward it!) that includes a bunch of investments that don't always move in the same direction — bonds and stocks, for example. You need to diversify.

Putting an assortment of eggs in various baskets isn't the only way to spread your risk. You can also avoid the risk of investing in a company at exactly the wrong time. Say you're interested in buying shares of Scruffy's Chicken Shack but you just don't know when to pull the trigger.

The answer? Take a bunch of shots!

Practically speaking, you do this through dollar-cost averaging (this means accumulating shares in a stock over time by investing a certain dollar amount regularly) through up and down periods.

So every month for three months, you purchase $500 of Scruffy stock, regardless of the stock price. The beauty of this system is that when the stock slumps, you're buying more, and when it's pricier, you're buying less.

"Buying in thirds" is another way to average into an investment: Simply divide the total dollar amount you want to devote to a particular investment by three, and pick three different points in time to add to your position.

Stay strong, think long!

[toy71camaro]

that is a great summary. :thumbsup:

[WSSix]

I'm really not happy with the new Google Finance layout. What other sites are people using to see there stocks performance and get news about the stock at the same time? You know, how google finance used to be, lol.

Thanks

[GregWeld]

I'm really not happy with the new Google Finance layout. What other sites are people using to see there stocks performance and get news about the stock at the same time? You know, how google finance used to be, lol.

Thanks



Couldn't agree more Trey! Google managed to make a mess out of what was something decent. It's even worse on "mobile" platforms where you can only get percentage increase or decrease vs actual move in $$ and cents.

[GregWeld]

Someone asked me today if I saw the market drop as a buying opportunity.

Nobody really knows do they. Wish I had a crystal ball - but I don't - nor do the talking heads on TV.


Here's my PERSONAL view --

#1 - I was in the hospital today (Mayo Clinic) getting another procedure done so wasn't around to see what was going on.

#2 - I raised a pile of cash a week ago. I had sold all the high fliers I'd been buying (because they've been the only thing truly working for months now) - I'm talking about Salesforce (CRM) - Splunk (SPLK) - Alibaba (BABA) - Boeing (BA) - Nucor (NUE) - and I sold most of my Amazon (AMZN) and kept 200 shares that I have an average cost of under $1,000 a share.

#3 - Why? Because we have a whacko political scene (don't take this as an invite to discuss politics or as my view on politics - it's not) - we have the tariff talks (now action) - we have rising interest rates and I wanted to be ahead of a surprise FED move - and mostly because the market has acted as if it was looking for ANY reason to sell vs buy.

This is INVESTING 102 -- it's not a thread called "trader talk" - I don't discuss what I'm doing, or not doing, personally unless it's used as an example here. I get many trades wrong - I get a lot right.... and what I'm doing is not what someone else should be doing.

+++++++++ HERE'S THE REASON I'M POSTING TODAY +++++++++++



I want to remind you -- as INVESTORS -- as share prices come down --- the DIVIDEND YIELD goes up as a percentage. Stocks are just like BONDS - bond prices fall the yield rises. Bond / share prices rise - the percentage of yield falls.

So ---------- we are in a rising rate market - yet share prices have gone thru the roof -- making YIELDS hard to find. As the market sells off --- all of a sudden some stock you'd like to have invested in - but felt the yield was too low and the price too high --- HEY!!! That bad boy might be falling right in your lap!

Don't RUN from the market during selloffs --- rather --- keep some powder dry -- don't rush in and buy everything you ever wanted. WAIT to see what happens -- chip away at what you've been watching/waiting to buy because we don't know if the market goes right back up - or we get a downturn that lasts for months (we are heading in to summer in a couple months - Sell in May and Go away) and add up all the other pressures or headwinds the market can run into...

Remember your timeline ----- those who ran to sell at losses back in '08 and '09 and then watched as the market roared right back with HUGE gains (they sold too soon and at the bottom -- then waited to be absolutely sure the market wasn't going to bite them again - and thus bought at the top - or after the market had run 25 or 40%). If you have 10 or 20 years -- remember that. If you put money in the market that you planned to buy a house with next week --- yeah --- well that was just dumb to begin with.

As "market" rates rise -- stocks fall to make their rates attractive. Nobody is going to buy an "expensive" stock that pays 2% dividend -- when they could get 3% interest in something else --- so it's a natural phenomenon that money moves around to find the yield that's attractive. It's the way money works -- it's always worked the same -- it will never change. Recognize it - know it - understand it.

[SSLance]

I got a little buying done yesterday morning. Anyone else?

[GregWeld]

I got a little buying done yesterday morning. Anyone else?

I'm at the highest cash reserve that I've been at in about 4 years (2.4MM). I'm not buying anything until I see this market settle down. It's just too hard....

[ADY]

Same here, highest I've been in cash since I started investing... this article makes me think the market is in the first stage of grief... "Denial":

https://www.cnbc.com/2018/03/27/goldman-sachs-computer-model-warns-bear-market-is-near-but-the-firms-analysts-dont-believe-it.html

[Flash68]

I'm at the lowest cash reserves I have been at in years..... cars, kids, bla bla bla bla

:hitaxeonthehead:

[SSLance]

I just reallocated some funds from some sells not long ago, I am still sitting on enough cash to fund many years of retirement as well.

[dhutton]

I did some major selling of my IRA holdings yesterday. Now that I am retired I don’t have the stomach for this market.

Don

[SSLance]

Interesting observations from last couple of days... While the DOW seems to be treading water or even down...everything on my board is green, WAY green...

Dow is down a half a point this morning and my IRA is up almost a full point.

[GregWeld]

Interesting observations from last couple of days... While the DOW seems to be treading water or even down...everything on my board is green, WAY green...

Dow is down a half a point this morning and my IRA is up almost a full point.



Yes --- interesting "rotation" (not the car arse end this time) showing up in my accounts as well --- Tech getting its arse handed to it (it should have - it's run too far too fast) -- and the stuff that hadn't been working (dividend shares) are having nice gains.

Meaning -- the cash has to go somewhere -- it tends to hide in dividend shares when the speculation (hot stocks) becomes scary.

[mdprovee]

I'm at the lowest cash reserves I have been at in years..... cars, kids, bla bla bla bla

:hitaxeonthehead:

Ain't that the truth!!!

[Flash68]

Ain't that the truth!!!

Cheers Mike. :) :cheers:

[glassman]

Cramer. "Nobody ever made a dime panicking".

first time i heard this quote, but learned it here first.

Long term (not timing the market, its time in the market)

Pay attention (don't invest and forget, i've done this much in my past and to some extent, still do)

Minimize personal overhead, think dividend income (read withdraw) much later.

Just had my cruddiest quarter (at my company) in 7 years. Things are on the up now, but beware, be savvy.

Learned alot on this thread, these are just a few words of encouragement from a 51 year old "newb", never stop learning.....

"as society regress's forward..."

[WSSix]

If you look at just my balance, all of my gains from 2017 have been wiped out thus far. Not worried though. I'm in good names and will be buying more soon. Heck, I remember thinking a year ago that I wish I had bought more when prices were lower on a number of my stocks. Well, now they are, lol.

[glassman]

Trey, how many (individual stocks) do you hold right now? managing.

Heard an interesting thing from Cramer today, he said he did the best when he went down to holding less stocks but best of breed, realizing that those were his money makers. Hmmm, where'd we hear that before????

I've got six best of breeds, adding as cash flow increases. Weirdly, my 401K , Roth, and a few Vanguards and T-Rowes are doing(did) pretty well.

Hate to say it, i'm up 54% on McD's, bought it cause "wifey worked there" and she wanted my to get it. She's my lucky charm, i wish a wife like that on everybody, shes a rock star.

[WSSix]

In the account that I manage, there are 9 stocks I do anything with. I have 13 total in that account though. 2 are gambles, 1 was given to me as the company split, and the fourth is my ESPP from my days at Haliburton. I don't touch it because I'm so overweight in it compared to the rest. I include all of them in my comment though. From the beginning of me starting this account, I'm still way up. It's just my gains from 2017 that went bubye now.

I don't bother to add more names because I have enough to watch as it is. I also have two other accounts that are managed by professionals mainly. I consider myself to be very diversified.

[WSSix]

Funny what a few days can do. I've already recovered 50% of what I've "lost". No I don't think this is the end of it. Point is, relax and let it play out a bit before freaking out. It goes up and down always.

[SSLance]

Consumable\retail companies taking a beating today... PG, MO, PM all way down. Such a strange market...

My buy itchy trigger finger is poised but may employ restraint and wait it out a couple days. Sure looks like a few good buys right now though.

[CJD Automotive]

Hey guys, I have a question, or more of a, "what do you think is best" question.

I am not a market investor, I've always been more comfortable with property, so please forgive any ignorance.

I have one property that generates roughly 70K a year in leases, but can sell for 800-900K right now. I think I am better off selling the property and then investing the money with an advisor (never used one). Even if I get a 10-12% return, it's still more than the property generates in leases. Just trying to weigh this out and figure it. I have my properties under a separate LLC, so not sure how that works investing as a company?

[nickcornilsen]

Hey guys, I have a question, or more of a, "what do you think is best" question.

I am not a market investor, I've always been more comfortable with property, so please forgive any ignorance.

I have one property that generates roughly 70K a year in leases, but can sell for 800-900K right now. I think I am better off selling the property and then investing the money with an advisor (never used one). Even if I get a 10-12% return, it's still more than the property generates in leases. Just trying to weigh this out and figure it. I have my properties under a separate LLC, so not sure how that works investing as a company?

I'm not sure how to move your LLC's assets into some sort of fund or equities investment, but generally, I would never hold an real estate asset that could not bring in 1% of it's current value as rent per month; unless I was going to invest more money into to get that rate of return, OR was going to flip it. The liabilities and opportunity costs are too high. So I think selling it is the right thing to do.

As for your investments, be wary before putting it with an adviser. Know the fees... load fees, back end fees, expense ratios. You can't control the market, but you can control fees. Know that the difference over a couple decades between .01% expense ratios and 1% Expense Ratios can be 40%!

My philosophy has always been to do the index fund thing, ignore it, and let it grow. Day trading has always seemed like gambling to me, as I rarely have information that isn't already priced into the market.

[Vegas69]

The depreciation and capital gains taxes could make a 1031 exchange into a better investment property the way to go.

I'm with him, I would be hesitant to put it with an advisor. I also like an index fund for low fees and set it and forget it. Simple is good.

Personally, if I sold it, I would sit on the sidelines for a bit and see what happens. It sure feels like a climax is coming to me. Between personal debt exceeding bust times and the crazy and stupid crap I'm seeing in our real estate market, I wouldn't leap, I'd crawl into another avenue.

[JKnight]

I definitely agree with Todd that it seems we are waaay closer to the next downturn in equities than most are acknowledging. Just look at the crazy level of auto loan debt our country has gotten themselves into. However, by the rules of investing 102, you don’t want to sit entirely in cash wanting to time the market. But I’d suggest rolling in slowly and keep cash on hand to buy during/after the inevitable decline.

[GregWeld]

Hey guys, I have a question, or more of a, "what do you think is best" question.

I am not a market investor, I've always been more comfortable with property, so please forgive any ignorance.

I have one property that generates roughly 70K a year in leases, but can sell for 800-900K right now. I think I am better off selling the property and then investing the money with an advisor (never used one). Even if I get a 10-12% return, it's still more than the property generates in leases. Just trying to weigh this out and figure it. I have my properties under a separate LLC, so not sure how that works investing as a company?



I need to be very careful here because of my level of Cancer meds on board.... but here's a couple thoughts having just gone thru this type of "review".

Property (actually all investments) really needs to be looked at with a view toward two things ---- Diversity of investments ---- Tax situation.

Real returns are based on individual situations and should only be calculated with an accounts input because he'll have important feedback on how the investment affects your total tax bill etc.

So --- Here's my thing on Real Estate..... it IS NOT a hedge against market moves. Typically the real estate market will suck right alongside the stock market if the market sucks. It is NOT LIQUID which is the #1 negative to me IF a guy doesn't have a bunch of other liquidity he can touch if needed. It is generally a great buy and hold investment.... and I think everyone should try to reach a point in their investments that they get to hold commercial real estate.

Some real estate investors are ill equipped to hold a property thru a long term recession when the property goes negative cash flow.... and of course --- that negative cash flow is what triggers the "I should sell" brain waves... and commercial real estate is valved based on it's POSITIVE cash generation over time. Guess what it's worth when you're feeding the SOB every month....

Now -- back up here somewhere is a post about an apartment complex we have that's up for sale. I pushed for the sale because of the current math.... the property is worth double... the income is fixed.... it's a nice return of capital in a pigs get fats and hogs get slaughtered kind of real estate market IMHO.

[CJD Automotive]

I appreciate everyones responses and advice. This is why I've never been a market investor, just so damn confusing with fees, etc...

I have a few commercial and residential properties (I know Greg hates residential!) and fortunately all paid for; taxes and insurance only, and I can sustain that even if left empty. This one properties value is high right now, so when I base my rent to value, it falls short and could be considered under performing.

I have friends that invest and keep telling me the market would return 10-12% and effectively double my principal investment in 7 years? My thinking is that the property returns less than 10%, and doubtful it will double in value in ten years. My principal market investment should continue to return more as the return is added to the principal and increase the investment? I don't know, that's why I'm asking you guys that are a whole lot smarter about this than me! Again, I appreciate everyones advice and opinions, lots of food for thought.

[Flash68]

I love Real Estate. Acquire as much as I can as often as I can.... commercial, residential, owner-occupied, rental.... but it's all strategic. And timed. I feel way more comfortable and equipped timing the RE market than I do the stock market! (Good luck with that)

I plan to live off RE down the road..... well, and my wife's income. :peepwall:

:D



I have a few commercial and residential properties (I know Greg hates residential!)

Nah, Greg likes anything that makes MONEY! :G-Dub:

[Vegas69]

I appreciate everyones responses and advice. This is why I've never been a market investor, just so damn confusing with fees, etc...

I have a few commercial and residential properties (I know Greg hates residential!) and fortunately all paid for; taxes and insurance only, and I can sustain that even if left empty. This one properties value is high right now, so when I base my rent to value, it falls short and could be considered under performing.

I have friends that invest and keep telling me the market would return 10-12% and effectively double my principal investment in 7 years? My thinking is that the property returns less than 10%, and doubtful it will double in value in ten years. My principal market investment should continue to return more as the return is added to the principal and increase the investment? I don't know, that's why I'm asking you guys that are a whole lot smarter about this than me! Again, I appreciate everyones advice and opinions, lots of food for thought.

My thought that comes to mind, "do what you know". You've clearly been very successful in real estate.

[GregWeld]

My thought that comes to mind, "do what you know". You've clearly been very successful in real estate.

Great statement!

[GregWeld]

In a bull run powering through its 10th year, market timing has become an onerous task. One week stocks are climbing to reflect a stellar pace of earnings growth. The next they’re in the red as yields jump and trade talks with China stall. The cost is less to the wallet than the psyche, after two years of uninterrupted gains.



THIS is such an important part of investing to remember....... you'll get it - the longer you're an investor. That whole "psyche" part -- is the part I've been trying to break down for you all, for the last however many years here.....

What helps the psyche the most??

Remembering that you bought great companies -- with real earnings -- that you like -- that distribute the earnings to you (you are a company owner!) -- with charts that are lower on the left and higher on the right....

Or --- we can go to sleep with?


I paid up huge for "pick a name" -- those SOB's better have a great quarter tomorrow or I'm screwed...

[GregWeld]

https://www.cnbc.com/amp/2018/06/22/warren-buffetts-favorite-book-on-investing.html

[Flash68]

https://www.cnbc.com/amp/2018/06/22/warren-buffetts-favorite-book-on-investing.html

Read that book about 15 years ago! Great book... timeless principles.

[WSSix]

Never heard of it. I might check it out though.

[Vegas69]

Read that book about 15 years ago! Great book... timeless principles.

Good to know the last time you read.

[Flash68]

Good to know the last time you read.

https://photos.smugmug.com/photos/i-nS8rNQM/0/a0351dc7/X2/i-nS8rNQM-X2.png (https://davidgordon.smugmug.com/Misc/n-Pp9jSk/i-nS8rNQM/A)

[Vegas69]

Picture of my idea of success right there. Ha

[WSSix]

lol, that's awesome, Dave!

[GregWeld]

Absolute fact!

“One of the most shocking things is the low-level financial literacy throughout our culture,” Puritz told the Washington Post. “It’s independent of education. Doctors, MBAs, corporate executives are incredibly competent in everything they do. But when it comes to investing, you run into this cauldron of mostly negative emotions, embarrassment, frustration, guilt. It leads to paralysis.”

[GregWeld]

https://www.cnbc.com/2018/06/22/what-an-omaha-waitress-learned-from-serving-warren-buffett-for-years.html

[glassman]

Good read from a great guy!!
Inside tonite watchin reruns of The Office , season 8, I believe, Buffet interviews for the mgr position....classic. I just wonder who or how that was put together....lol

[toy71camaro]

Well, just rolled my 401k over to an IRA after leaving my previous employer.

Now to figure out what to do with it. Hah. Time to research again. Question, what % would you set aside and "not" invest? So that there is some cash on the sidelines.

Also, I could probably use a bit of help making sure I am diversified. Any help would be appreciated.. Right now, I'm thinking of just adding the same % to my current holding, but concerned I may not be diversified enough...

Current Holdings:
MCD
MO
CVX
ED
GM
HD
KO
KMB
T
ABT
ABBV
PFE
LMT
AFL
BABA
WFC
COST
AMZN
NNN

[GregWeld]

That list looks FINE Albert!

Do NOT put your IRA/401 funds in the same exact names you hold outside the retirement funds.....


That's not to say you can't pick a couple and double up -- but you really should use the retirement stuff as just an extension of your total.... but continue on the diversity side.

We don't know your age and income and net worth etc ---- and I'm not an advisor --- but since we don't "need" our retirement --- I play more in that account with riskier names --- I don't trade it -- but I hold the NFLX and that kind of stuff in there.... but that's because it's just play money for us --- and others need to think about their total assets -- risk/reward -- age (how long can you go if you need to recover? 10 years?)..... etc.

[toy71camaro]

Thanks Greg!

I did fail to mention those holdings are all in my ROTH. Also, I'm 38, so I still have a few years. ;)

[GregWeld]

Thanks Greg!

I did fail to mention those holdings are all in my ROTH. Also, I'm 38, so I still have a few years. ;)


Be more aggressive with 20 or 25% of your portfolio..... Go ahead and take a little risk - you have 30 years before retirement..... and will be retired many years after that.... so look at your investments as "what is this company going to be like 20 years from now?"

That % takes a little more thought --- and little more control of your emotions -- you're looking for growth -- balanced with what you think the company is capable of going forward.

[WSSix]

Cool deal. We're the same age Albert. So, yes, what Greg said. I'd get a little more aggressive with part of the portfolio. You can do this by picking the names yourself or put it in a managed account that's more aggressive. Who do you have your Roth with? If one of the big four brokerage houses, they offer more aggressive managed accounts.

The way I diversify is that I only manage a portion of my retirement accounts. I have multiple accounts due to starting my own and having company sponsored accounts. Some I've rolled over but others I just left alone. I let smarter people than me manage those accounts. I choose my stocks in a portion of my Roth and my brokerage account only. My 401ks are professionally managed. I try not to copy the same stocks they use though I know I have some overlap. Don't sweat it too much. You have a good list going. I'm just offering suggestions.

As for savings, I believe the suggestion is to have 6-12 months of income in a readily accessible account. I have mine in an online savings account. It pays better than anything local but it's just a place to park the money should I need it.

[GregWeld]

I stole this statement from a letter written by the incoming CEO of Chrysler Fiat Ferrari..... about Marchionne - who's health issues have knocked him out of the spot.


I'd changed the word LEADER to FRIEND.... and I hope some of you will live a long life in retirement, and that you continue to come here often and pay it forward for your friends and family.


“The true value of a friend is not measured by what he has gained during his career but rather by what he has given. It is not what you accomplish today, but the legacy you will leave behind.”

[Ns RS]

A wealthy man once said own your tomorrow, this thread shows you how.
thx for showing the way friend

[RKROEGER]

Yes, thank you

[GregWeld]

Many times I've raised the issue of "rising FED rates"....


Here's PERHAPS a sign of caution.... and the "cause and affect" of such seemingly simple "things".


Southern California home sales crash, a warning sign to the nation


Sales down almost 12%...... that's a large number if you're a businessman.

[captainofiron]

to Greg and the other gurus:

What do you all think about low cost Index funds, like VTI and VTSMX?

[Vegas69]

Many times I've raised the issue of "rising FED rates"....


Here's PERHAPS a sign of caution.... and the "cause and affect" of such seemingly simple "things".


Southern California home sales crash, a warning sign to the nation


Sales down almost 12%...... that's a large number if you're a businessman.

I was on a Mastermind call last week with top agents with two being in CA. They said the market has cooled off and stayed pretty flat for 5-6 months. The news is looking to trigger emotions. Twelve percent is hardly a crash. This country has been in a robust real estate market for some time now and it has to cool at some point. I do think it's something to pay attention to though! I've now heard the same thing from multiple people. What kills markets? Pessimism, and it spreads like wild fire.

[Vegas69]

to Greg and the other gurus:

What do you all think about low cost Index funds, like VTI and VTSMX?

Instead of opening a worthless bank account for my son, I put some of his birthday money into VOO in early 2017. It's up 20.2%.

[captainofiron]

Instead of opening a worthless bank account for my son, I put some of his birthday money into VOO in early 2017. It's up 20.2%.

So I'll put you in the "YESSS!" column haha

[GregWeld]

It all "depends" ---- and I know that's a big non answer.

Depends on goals - age - what other investments you have.... and it really gets down to -- What you're comfortable with. If you're an investor that buys and forgets.... then index funds work to cover that.

But make sure you actually know what you're buying ---- and remember -- a rising tide floats all boats -- so your index fund will look like a hero in an up market -- but don't expect it to magically save your ass when the market drops -- so will your fund.

I prefer (personally) knowing what I own -- and this is even more important when the market sucks....

[JKnight]

I agree with the above, it depends on your goals. I’ve been buying ETFs online, commission free, which is an important distinction if you’re buying small amounts at a time. Like Todd said, instead of putting a couple hundred per week/month/whatever into a savings account, I can buy ETFs a couple shares at a time in my brokerage and there’s no commission to eat into the principal.

[toy71camaro]

Cool deal. We're the same age Albert. So, yes, what Greg said. I'd get a little more aggressive with part of the portfolio. You can do this by picking the names yourself or put it in a managed account that's more aggressive. Who do you have your Roth with? If one of the big four brokerage houses, they offer more aggressive managed accounts.

The way I diversify is that I only manage a portion of my retirement accounts. I have multiple accounts due to starting my own and having company sponsored accounts. Some I've rolled over but others I just left alone. I let smarter people than me manage those accounts. I choose my stocks in a portion of my Roth and my brokerage account only. My 401ks are professionally managed. I try not to copy the same stocks they use though I know I have some overlap. Don't sweat it too much. You have a good list going. I'm just offering suggestions.

As for savings, I believe the suggestion is to have 6-12 months of income in a readily accessible account. I have mine in an online savings account. It pays better than anything local but it's just a place to park the money should I need it.


sorry, hadnt checked on the thread in a bit, so my reply isnt very timely. At this point, all of my retirement is self managed. 2\3 of it or so is cash that i just rolled out of my previous employers sponsored 401k into my own IRA. its held by sharebuilder/capital one investing, but soon to be all transferred to etrade. which im not too happy about as they appear to be cutting the DRIP option. :( i havent decided yet or done the research for what to invest the ira in.

I'm curious as to what yall think is a decent % of cash to set aside in the Ira/roth for the future purchases if the market goes down, or to invest it all. i do already have a good 9-12 month liquid emergency fun separate from this as well.


what would you all consider "higher risk"?

sorry for poor grammar. typing from a tablet while at my daughters' gymnastics practice. lol

[GregWeld]

Albert -- holding "CASH" in a retirement account is not a good thing to do..... for a number of reasons -- but it's not "accessible" cash when it's in a retirement account. There would be early withdrawal penalties etc -- and if you ever really need "cash" -- a brokerage will loan you money against your account -- There's many rules and tax items to deal with but you get the drift.

The reason you don't want "cash" in a retirement account is that the account should be considered your more "LONG TERM" account -- it's there to grow before retirement -- and it's there to spin off income etc for long after you retire.

Most of the stock markets gains are on VERY few days.... if you're not invested on those days... you miss the years gains! SO trying to "time the market" with holding cash -- and waiting.... well --- do that with your non retirement accounts if it makes you feel good.

If you don't know where to put the cash - just stick it in the SPY or QQQ or something similar.

[captainofiron]

It all "depends" ---- and I know that's a big non answer.

Depends on goals - age - what other investments you have.... and it really gets down to -- What you're comfortable with. If you're an investor that buys and forgets.... then index funds work to cover that.

But make sure you actually know what you're buying ---- and remember -- a rising tide floats all boats -- so your index fund will look like a hero in an up market -- but don't expect it to magically save your ass when the market drops -- so will your fund.

I prefer (personally) knowing what I own -- and this is even more important when the market sucks....

Thanks!

so I'm 35, the majority of my IRA is in specific names that I did a ton of research on and I am comfortable with. For the most part I am a buy and hold/forget investor

I recently rolled over a big chunk and it had been sitting for a month or 2 and I didnt want it to just sit, but I dont have enough time to do extensive research, so I figured the index fund would fit my needs at this time

from what I read it seems like alot of people like these index funds, but it kind of goes against everything I've read here

Yea I am not expecting it to be this magic fund that will never go down, just dont want dead money in an interest only position

[toy71camaro]

Thanks!

so I'm 35, the majority of my IRA is in specific names that I did a ton of research on and I am comfortable with. For the most part I am a buy and hold/forget investor

I recently rolled over a big chunk and it had been sitting for a month or 2 and I didnt want it to just sit, but I dont have enough time to do extensive research, so I figured the index fund would fit my needs at this time

from what I read it seems like alot of people like these index funds, but it kind of goes against everything I've read here

Yea I am not expecting it to be this magic fund that will never go down, just dont want dead money in an interest only position

Sounds like we're in darn near the same boat. Almost same age, and similar situation. All my investments are researched single stocks, except for the large chunk i just rolled into my IRA, and i havent had the time to research anything yet.

[Vegas69]

I personally like the index fund route after Roth IRA or IRA to Roth Conversion. You beat 96% of the mutual funds out there and it's very low maintenance. Even Buffett states that's what the majority should do. I'd like to pretend I'm going to spend the time watching and researching companies, but it's not reality long term. I think you need to be passionate about it like Greg. There are other things I'd rather be doing with my time.

I'm certainly not saying I'm done buying stocks, I'm just not betting the farm on it either.

[captainofiron]

AAAAAND just as I bought into VTI Fidelity emails me about FZROX and FZILX

LOL

[JKnight]

The zero expense thing? Yeah...I’m sure the expenses on your ETF are nearly nothing, but not quiiiite zero.

[captainofiron]

The zero expense thing? Yeah...I’m sure the expenses on your ETF are nearly nothing, but not quiiiite zero.

True

I didn't read it 100% but it seems like there is no commission to but those ETFs

If so that might be a good position until I can do more research

[glassman]

Who do you all read/watch for business/trading news

Morningstar?
Motley Fool?(fee based i believe)
CNBC?
Bloomberg?
Seeking Alpha?
Cramer? (Mad Money)

suggestions? experiences with reliability....

[Ns RS]

Who do you all read/watch for business/trading news

Morningstar?
Motley Fool?(fee based i believe)
CNBC?
Bloomberg?
Seeking Alpha?
Cramer? (Mad Money)

suggestions? experiences with reliability....

My morning routine is to read wsj on my days off at a starbucks -they usually have one or two available - it has been helpful in getting an economic vibe on where things are going and certain companies to pay attention to - has been a great resource for me

[GregWeld]

I watch CNBC from 6AM to 3 or 4..... it's "on" but it's background noise. If you listened to the talking heads -- you'd sell one minute and be buying the next.... ditto the "papers" and subscription "services".

This is why I have pounded the table to ignore all that noise -- it's trader talk!

Buy what you know -- collect a dividend -- watch it grow over time..... if you own 10 stocks 3 may be winners.... and they'll change places like a good horse race.

Calm down and think longer term.

[glassman]

Calm down and think longer term.

I don't do calm very well. But when i do, i jump for joy.

I hear what your saying though...as i've been trying to "average in", i'm just looking for those fundamental changes we've spoken about in the past....

cheers, mike

[joeko23]

I’m not sure if anyone has suggested this maybe they did there are 600 pages. I also don’t know how much money you have to play with. With all that being said try to buy some property and rent it. My rentals bring around 10% return. If you have some free time and a little more money get into flipping properties/condos etc.especially if your handy. I’m sure you are because your in this forum and a lot of diyers are here. That obviously requires more money. Also unless you are in Kansas short term like less than a year. Do Not Rent. Buy a property for you to live in so you are not just throwing out money in rent. Better to pay your mortgage than someone else’s mortgage. Buy something that needs some light work like updating bathrooms or kitchen. Put some lipstick on it and your free time. When it comes time to sell maybe you will make 50k. There are also ways you can get into flipping while not using your own money. Easiest way is you get an equity line of credit on your home or your parents home (once you find an actual property to flip that’s the hardest part) doesn’t matter the interest rate as long as you can borrow enough to buy and renovate then sell. Within 6 months (depending how long Reno takes) you will have that line of credit paid off plus some extra money on your proceeds which you should use for the next flip.

Think of it this way, money opens doors for you to make more money. That’s why rich will always get richer and poor will always get poorer. Never let your money just sit in a savings account or IRS or mutual fund because then the bank uses your money to make themselves richer. Use what you have saved up. I’m sure in Kansas there has to be properties that are 50k. Maybe you polish that terd and make it move in condition and make 10-20k

[rustomatic]

Mike, Jim Cramer was banned from trading (stocks) years ago. He had a hedge fund and did . . . typical hedge fund things, but got caught; he is an entertaining and knowledgeable guy (TV personality!), but he's telling you (literally) yesterday's news. Sites like Motley Fool are paid to pump stocks (by writing crap that makes them sound appealing), which leads to buying in the midst of a (sometimes institutional/insider) dump. CNBC is designed to sell advertising, itself, and services, like all TV.

With easy "information," you get what you pay for, which is nothing. Read Benjamin Graham, maybe some George Soros, and use the education features that come with trading accounts you can get through companies like TD Ameritrade (or others) for free. Try a book like Trading (or Investing) For Dummies--it sounds offensive, but the information tends to be pretty good. Most books you'll find at Barnes and Noble on investing, however, tend to be junk. There's some decent content on YouTube . . .

Who do you all read/watch for business/trading news

Morningstar?
Motley Fool?(fee based i believe)
CNBC?
Bloomberg?
Seeking Alpha?
Cramer? (Mad Money)

suggestions? experiences with reliability....

[glassman]

Mike, Jim Cramer was banned from trading (stocks) years ago. He had a hedge fund and did . . . typical hedge fund things, but got caught; he is an entertaining and knowledgeable guy (TV personality!), but he's telling you (literally) yesterday's news. Sites like Motley Fool are paid to pump stocks (by writing crap that makes them sound appealing), which leads to buying in the midst of a (sometimes institutional/insider) dump. CNBC is designed to sell advertising, itself, and services, like all TV.

With easy "information," you get what you pay for, which is nothing. Read Benjamin Graham, maybe some George Soros, and use the education features that come with trading accounts you can get through companies like TD Ameritrade (or others) for free. Try a book like Trading (or Investing) For Dummies--it sounds offensive, but the information tends to be pretty good. Most books you'll find at Barnes and Noble on investing, however, tend to be junk. There's some decent content on YouTube . . .

No doubt, i hear what your saying. I just want to keep up with fundamental changes of the larger companies we invest in. Like new products, or change in leadership, etc etc....
I, like many of us here, very much subscribe to the Peter Lynch (One Up On Wall Street '87, head of the Fidelity Magellan fund 80's and 90's) school of thought. "If you like it, or theres a line, buy the stock/business"

KISS

thanx for all your feedback, appreciate it, mike

[Try2paz]

I like Motley Fool.. but with some caveats.

They seem to have two lines of web fronts.

Option A.. is using Cramers name all over pump and dump articles. It's click bait.

Option B.. Is a podcast that generally just gives a state of the union on the market for that week (report on earning calls etc). They also have a subscription option that they have a variety of profiles that has stock picks selected. I don't see how that could be viewed as pump and dump as they show you buy date / buy price / and if they sell etc. I've know a few people that just do option B and buy the same day and sell the same day and they have had a nice return for many years.

[GregWeld]

Remember please -- the basics -- you don't need Motely TOOL --- or CNBC -- or the wall street journal. If you think you do -- then you've misread everything here.

[GregWeld]

Great read --- guy retires at 34 with 200K "passive" income... passive being -- it's not EARNED income == so taxes for the most part are going to be very favorable....


https://www.businessinsider.com/how-to-make-passive-income-investments-real-estate-2018-8

[GregWeld]

Today is a CLASSIC example of why it's so wrong to attempt to "time" the market....

If you've been holding WALMART --- you just picked up 10% gain....

This is exactly what happens OVER TIME..... but you have to be a holder (not just this name) to ride the big jumps....

Of course -- if you're not really an "investor" -- then you'll be out when things go great and in when they suck.

Remember -- in many cases - your leaders will change!! I've had a loser in ETP for a very long time - it went from hero to zero when oil tanked..... but now -- is a gainer again. YEAH -- it's tough to hold while it's glowing red... but overall -- I believed in the original thesis... "they have the pipes" -- oil and gas flow thru pipes. Not trying to sell it -- just trying to use this as one example.

[WILWAXU]

Today is a CLASSIC example of why it's so wrong to attempt to "time" the market....

If you've been holding WALMART --- you just picked up 10% gain....

This is exactly what happens OVER TIME..... but you have to be a holder (not just this name) to ride the big jumps....

Of course -- if you're not really an "investor" -- then you'll be out when things go great and in when they suck.

Remember -- in many cases - your leaders will change!! I've had a loser in ETP for a very long time - it went from hero to zero when oil tanked..... but now -- is a gainer again. YEAH -- it's tough to hold while it's glowing red... but overall -- I believed in the original thesis... "they have the pipes" -- oil and gas flow thru pipes. Not trying to sell it -- just trying to use this as one example.

Nice boost for MCD too.

[glassman]

I'm only up 62% in MCD. wish it was more lol.

Long haul.

Still having fun buying and selling melted sand. Cept' for the people..:bang:

[GregWeld]

WATCH HOUSING FOR EARLY SIGNS OF DETERIORATING ECONOMY or for strength -- ditto AUTOS.... these are early "tells" for the consumer. The consumer is 2/3ds of the economy. Everything lives or dies based on "sentiment" -- and what folks feel like going forward. You don't buy a house or new car if you're not "feeling it" -- so check your own pulse first.

[glassman]

I hear ya. Loud and clear.

Whats the other 1/3? government being the majority of that portion of the remaining 33%?

[GregWeld]

I hear ya. Loud and clear.

Whats the other 1/3? government being the majority of that portion of the remaining 33%?



The way this country is headed -- with more and more losers waiting for handouts --- the government (which is really US!) is probably 50% by now.... and that's why you can't buy as much as you really want to! LOL

[captainofiron]

Any tips for paying a mortgage early?

I have been reading about Home Equity Lines of Credit (HELOC) and "Velocity Banking"

I was skeptical when I first read about it, but after running the numbers

So as it stands we have a 30 yr mortgage (payoff in 2046) and are paying "3.875%" interest and if we change nothing will end up paying $135k in interest

After running the numbers with a 4.5% HELOC and using 65k for that Velocity banking scheme, we will pay it off in 2025 and only pay 40k in interest (both on the HELOC and Mortgage)

Thoughts?
Opinions?
Advice?

The only CON I can think of is the variable interest, but my calculation has the interest rate going up in a curve with max .45% increases and .20% decreases

[Flash68]

Any tips for paying a mortgage early?

I have been reading about Home Equity Lines of Credit (HELOC) and "Velocity Banking"

I was skeptical when I first read about it, but after running the numbers

So as it stands we have a 30 yr mortgage (payoff in 2046) and are paying "3.875%" interest and if we change nothing will end up paying $135k in interest

After running the numbers with a 4.5% HELOC and using 65k for that Velocity banking scheme, we will pay it off in 2025 and only pay 40k in interest (both on the HELOC and Mortgage)

Thoughts?
Opinions?
Advice?

The only CON I can think of is the variable interest, but my calculation has the interest rate going up in a curve with max .45% increases and .20% decreases

Have you factored/calculated the interest deduction benefit on your tax return for each year?

What about the opportunity cost of that money being spent to buy down the mortgage? That answer is different for everyone, but you should consider what you would do with that money if you didn't pay it off.

Personally, unless I am sitting on Weld type of cash.... I won't pay off my 3.75% 1st mortgage early. I'll invest that money elsewhere.... or buy cars/car parts. :D

[Vegas69]

Any tips for paying a mortgage early?

I have been reading about Home Equity Lines of Credit (HELOC) and "Velocity Banking"

I was skeptical when I first read about it, but after running the numbers

So as it stands we have a 30 yr mortgage (payoff in 2046) and are paying "3.875%" interest and if we change nothing will end up paying $135k in interest

After running the numbers with a 4.5% HELOC and using 65k for that Velocity banking scheme, we will pay it off in 2025 and only pay 40k in interest (both on the HELOC and Mortgage)

Thoughts?
Opinions?
Advice?

The only CON I can think of is the variable interest, but my calculation has the interest rate going up in a curve with max .45% increases and .20% decreases

Right now is the last time you want to get a variable rate on your primary residence in my opinion. I've seen many get caught with their shorts around their ankles doing just that.

[GregWeld]

No way I'd refi or have a HELOC or any other "extra" loan on my house....

You have a great low interest rate.... if you choose to save on your total interest paid -- just pay additional on the principal only when you choose to. That way you don't HAVE to pay anything extra -- or if you want to you can pay one extra payment each year and cut that 30 year to a 20.....

Altria (MO) pays over 5%.... just to pick one super simple investment...

I'd invest in almost anything over paying that mortgage rate down.

[captainofiron]

Thanks for the advice guys.

I just have a hard time wrapping my head around paying 170% of the loan I took out

luckily we were able to put a giant down payment from the last house we bought/sold (got lucky and bought after the recession bottomed out)

I have calculated the tax deduction, but generally come out ~1-2k above the standard deduction

It would just be awesome to be mortgage free

but like pointed out, we have a low rate and that variable interest scares the hell out of me

[Flash68]

Fixed rate is the way to go in these times. It's the main reason the current RE market is on pretty solid ground (although near or at the peak) all things considered.

Do not forget about the time value of money (TVM) when it comes to long term financing. The primary residence interest deduction is just a little icing on the cake.

[Vegas69]

Thanks for the advice guys.

I just have a hard time wrapping my head around paying 170% of the loan I took out

luckily we were able to put a giant down payment from the last house we bought/sold (got lucky and bought after the recession bottomed out)

I have calculated the tax deduction, but generally come out ~1-2k above the standard deduction

It would just be awesome to be mortgage free

but like pointed out, we have a low rate and that variable interest scares the hell out of me

Don't let these guys talk you out of paying your house off. It comes down to your own risk tolerance and goals. The majority of Americans should shoot for a free and clear by retirement age.

[Flash68]

Don't let these guys talk you out of paying your house off. It comes down to your own risk tolerance and goals. The majority of Americans should shoot for a free and clear by retirement age.

Epic Facepalm alert...

Like Greg alluded to, if you can't put your money into something and exceed a 3 or so % return (his mortgage rate MINUS a little for the net interest deduction) you are either math-deficient or unwilling to put a little effort in.

Hey, it's your money... :)

:action-smiley-027:

[dhutton]

Thanks for the advice guys.

I just have a hard time wrapping my head around paying 170% of the loan I took out



Make extra payments on the principle. It’s just that easy and there is zero risk...

Don

[Vegas69]

Hey, I'm not saying it's a bad play, but it may not be right for him.

I've never met one person with a paid for home that told me it was a mistake and I've met more than a few. Not everybody is looking to conquer the world and all the trouble that can bring. Some like a simple life with little risk.

Plus, you need a much higher return than 3% to make the math work. I don't know what it is, but I'm guessing 10+ percent to make it worth the trouble.

Bottom line, having a paid for home puts you in a very good position to have choices and security.

[Flash68]

Hey, I'm not saying it's a bad play, but it may not be right for him.

I've never met one person with a paid for home that told me it was a mistake and I've met more than a few. Not everybody is looking to conquer the world and all the trouble that can bring. Some like a simple life with little risk.

Plus, you need a much higher return than 3% to make the math work. I don't know what it is, but I'm guessing 10+ percent to make it worth the trouble.

Bottom line, having a paid for home puts you in a very good position to have choices and security.

Your 10+% guess is wrong. Way wrong. LOL

But I don't disagree that it is not for everyone. Not everyone has the risk tolerance to leverage and make their money work for them.

[GregWeld]

I don't think anyone would argue having a home free and clear - I know for damn sure I wouldn't.... but I'm also RETIRED.....

I think my point was that he should NOT do any fancy financing schemes to try to gain a little... and perhaps put himself at risk.... WHEN it's just so simple to throw extra at the principal.

His rate is under 4%.... fixed 30 years. You have any idea how good that could look 10 years from now? OMG.....

There are more ways than you can imagine to be SECURE and comfortable than to simply have no mortgage... and in fact -- I could argue endlessly why I would NOT want to be mortgage free prior to or even after retirement. That is all based on your ability to generate income.

People worry about their mortgage so much - they fail to realize that they NEED LIQUIDITY. A home isn't liquid if you get sick and lose your job... and having it paid for won't help you one bit when you have to take out cash or refi - when you don't have income or other assets.

Instead -- What I'd suggest is to cut your mortgage interest paid by adding extra payments to principal AND investing in other liquid assets that can be instantly and painlessly accessed should you need to.

In other words -- if you owed 100K and you have 200K in other cash based assets.... I'd say you should not be worried about making the mortgage payment. And you can borrow cash on cash for a hell of a lot cheaper than ANY mortgage should you need some.

[WSSix]

I'm doing the one extra payment per year thing to cut my 30 year mortgage down a few years. That alone saves a good chunk of change and it is very easy to do. I recommend it so long as you have your rainy day fund and retirement savings funded as well. As already mentioned, I wouldn't play games with this using different accounts.

[Vegas69]

Your 10+% guess is wrong. Way wrong. LOL

But I don't disagree that it is not for everyone. Not everyone has the risk tolerance to leverage and make their money work for them.

Tell me what it is Obi One Kenobe. :mock: Or do you want me to Google it for you? ha

[GregWeld]

Everyone loves to say they don't mind risk...... right up until they lose their ass.

[SSLance]

lol... :lol:

[Flash68]

Tell me what it is Obi One Kenobe. :mock: Or do you want me to Google it for you? ha

I didn't give a specific number because there isn't one. Your personal tax rates and investment vehicles would dictate what the number would be. Unless you are being taxed at 150+%, it is not 10%.

Try to keep up. :lol:

Still love ya Todd. :cheers:

Everyone loves to say they don't mind risk...... right up until they lose their ass.

As you know, there's risky business and there's calculated risk.

Nothing in life is guaranteed.... except your kids getting diarrhea and puking after an international vacation. :disgusted::badidea::wacko:

[SSLance]

At this stage of my life, I abhor risk...and do everything I can to avoid it at any cost. Hence why some keep telling me to have a much larger mortgage than I am comfortable with.

Pretty sure I'll be filing a 1040EZ this year...and I'm VERY okay with that. :peepwall:

[Vegas69]

I didn't give a specific number because there isn't one. Your personal tax rates and investment vehicles would dictate what the number would be. Unless you are being taxed at 150+%, it is not 10%.

Try to keep up. :lol:

Still love ya Todd. :cheers:



As you know, there's risky business and there's calculated risk.

Nothing in life is guaranteed.... except your kids getting diarrhea and puking after an international vacation. :disgusted::badidea::wacko:

You're full of &&&& too. :D

You'll have to tell me what I'm trying to keep up with? I'm simplifying and delegating every chance I get. More and more equals more bull**** to deal with. I've had plenty of that in the last 20 years. I'm headed for the simple life, my friend. Hope you are well...

[Flash68]

At this stage of my life, I abhor risk...and do everything I can to avoid it at any cost. Hence why some keep telling me to have a much larger mortgage than I am comfortable with.

Pretty sure I'll be filing a 1040EZ this year...and I'm VERY okay with that. :peepwall:

You're retired, right Lance? I don't blame you one bit. I don't want a big mortgage when I retire either.

Not sure who is telling you to have a bigger mortgage then you're comfortable with, but they suck. :computer:


You're full of &&&& too. :D

You'll have to tell me what I'm trying to keep up with? I'm simplifying and delegating every chance I get. More and more equals more bull**** to deal with. I've had plenty of that in the last 20 years. I'm headed for the simple life, my friend. Hope you are well...

Who isn't full of SH%$ around here? :lol:

I just assumed you graduated from Investing 101 already.... my bad. :lol:

All joking aside, what is clearly illustrated in this discussion is the fact that we all have different situations.... different risk tolerances... and our differing ages and earning power drives a lot of these things. And that's why it's an Investing 102 discussion I guess. :)

I am happy whatever you are doing is working for you.

You are still without a cool car so you currently suck. :action-smiley-027:

[SSLance]

You're retired, right Lance? I don't blame you one bit. I don't want a big mortgage when I retire either.

Not sure who is telling you to have a bigger mortgage then you're comfortable with, but they suck. :computer:



Well, I'm kinda retired... ;) I'm not working a 9-5 anymore but I still have to do things to earn a living.

Mainly it's those that would rather have my money working for them while working for me that make suggestions such as this. Thankfully I quit listening to those types a LONG time ago.

[Vegas69]

You're retired, right Lance? I don't blame you one bit. I don't want a big mortgage when I retire either.

Not sure who is telling you to have a bigger mortgage then you're comfortable with, but they suck. :computer:




Who isn't full of SH%$ around here? :lol:

I just assumed you graduated from Investing 101 already.... my bad. :lol:

All joking aside, what is clearly illustrated in this discussion is the fact that we all have different situations.... different risk tolerances... and our differing ages and earning power drives a lot of these things. And that's why it's an Investing 102 discussion I guess. :)

I am happy whatever you are doing is working for you.

You are still without a cool car so you currently suck. :action-smiley-027:

I have three cool cars, they are all paid for. :D

My strategy will stay similar. I like a small to no mortgage on my primary, invest 15% of gross income into retirement (half into vehicles I can access like individual stocks or an index fund to give me flexibility for opportunity), and take advantage of the real estate cycles. Try to buy low and sell high with investment properties when the numbers are great and the market is pessimistic. This is what I know and I'm content with where it got me at 41. Get rich quick, hardly, but I like the view from the tortoise. I don't have the desire to start over if I can help it.

[Flash68]

The hot rods are paid for (of course) but the 2 daily drivers still have a loan them -- why? Because the rate is 2%! (Same theme - I can make more return on that money in a bad year).

Hey, just because Dave Ramsey is scared to death of debt (due to his previous Bankruptcy) doesn't mean you have to be. :mock:

Not all debt is evil or crippling. It's a tool in the toolbox.

Keep on truckin buddy.... :cheers:

[Vegas69]

The hot rods are paid for (of course) but the 2 daily drivers still have a loan them -- why? Because the rate is 2%! (Same theme - I can make more return on that money in a bad year).

Hey, just because Dave Ramsey is scared to death of debt (due to his previous Bankruptcy) doesn't mean you have to be. :mock:

Not all debt is evil or crippling. It's a tool in the toolbox.

Keep on truckin buddy.... :cheers:

How do you think I've bought the 11+ properties I've owned? Using other peoples money. I read Rich Dad/Poor Dad as a young man. You aren't pulling the wool from my eyes. That's a big part of my financial success.

This reminds me of a good buddy in Phoenix. He always told me that he hated money in the bank and he leveraged it all out. He did extremely well and then went broke in 2008 including losing his primary residence. I'm talking from baller status to zero in no time flat plus a BK.

I know you are likely more conservative and have far better income stream than my buddy, but poor economies do come and so do bad streaks stocks and real estate. We've all been flourishing and riding a giant wave for a long time. Sounds kind of familiar.....

[out2kayak]

How do you think I've bought the 11+ properties I've owned? Using other peoples money. I read Rich Dad/Poor Dad as a young man. You aren't pulling the wool from my eyes. That's a big part of my financial success.

This reminds me of a good buddy in Phoenix. He always told me that he hated money in the bank and he leveraged it all out. He did extremely well and then went broke in 2008 including losing his primary residence. I'm talking from baller status to zero in no time flat plus a BK.

I know you are likely more conservative and have far better income stream than my buddy, but poor economies do come and so do bad streaks stocks and real estate. We've all been flourishing and riding a giant wave for a long time. Sounds kind of familiar.....

https://image.flaticon.com/icons/svg/25/25297.svg

:yes::yes:

[Flash68]

How do you think I've bought the 11+ properties I've owned? Using other peoples money. I read Rich Dad/Poor Dad as a young man. You aren't pulling the wool from my eyes. That's a big part of my financial success.

This reminds me of a good buddy in Phoenix. He always told me that he hated money in the bank and he leveraged it all out. He did extremely well and then went broke in 2008 including losing his primary residence. I'm talking from baller status to zero in no time flat plus a BK.

I know you are likely more conservative and have far better income stream than my buddy, but poor economies do come and so do bad streaks stocks and real estate. We've all been flourishing and riding a giant wave for a long time. Sounds kind of familiar.....

Bummer about your buddy. You shoulda had him call me in 2007 .. woulda told him to sell his RE like I did. Greed is a b!tch.

Rich Dad / Poor Dad was a decent read .... in sophomore year of college. 😂

Not sure I’d consider myself a conservative investor, but we’re a dual income family now and my wife’s niche is like death and taxes ... it knows no economic cycle. So that’s nice.

While a 30-40% drop in local RE values (or rents) would suck in theory, it wouldn’t cause me to lose sleep at night. We’re not very leveraged.

We also drive 12 year old and 5 year old vehicles. So no baller status here.

[WSSix]

I think you guys are hitting on a few good points that people often over look. Debt has been talked about here before but I'd wager a lot of people, for whatever reason, put their daily drivers in the "necessary debt" category and I disagree completely. My Tahoe is a 2006 that I bought two years ago with 135k. I'm looking at buying another toy that's less than 15k and at minimum 15 years old. I won't carry debt on them. My fiancee's Fit is a 2010 model that's long been paid for. Car's today are very reliable for the most part. Buying a used or older one for cash frees up so much money to be put into assets that actually appreciate. No car any of us are going to buy and use as a daily will appreciate. Unless you can write it off for work/taxes, it's costing you money. Finding ways to minimize that cost is great. Apply that same perspective to areas of your life where it's relevant and see how much more money you suddenly have available. I just think a lot of people aren't willing to truly be honest with themselves concerning what they really need to spend their money on. If they would, I think they'd be better off financially.

[SSLance]

My daily is a 2002 with 230,000 miles on it, no plan on upgrading it anytime soon. Wife's is a bit newer 2012 with 110,000 miles. Both owe me nothing...

Newish Escalades and Mercedes SUVs rule my neighborhood, along with new jacked up 4x4 trucks. I'm betting the majority of them have larger car payments than my mortgage payment. :relax:

[Vegas69]

My daily is a 2002 with 230,000 miles on it, no plan on upgrading it anytime soon. Wife's is a bit newer 2012 with 110,000 miles. Both owe me nothing...

Newish Escalades and Mercedes SUVs rule my neighborhood, along with new jacked up 4x4 trucks. I'm betting the majority of them have larger car payments than my mortgage payment. :relax:

That's the real American dream! They can keep the shackles on while you live well below your means. :D

[GregWeld]

I always like the "I can afford it" statement when it comes to MAKING PAYMENTS....

NO..... if you're making payments..... then YOU CAN NOT AFFORD IT. Affording it means you bought it - straight up. Period.

Putting 10% or less down on a house..... Yeah - NO. You really shouldn't be in that house (YET).

Being in debt on depreciating assets.... Yeah about that.... Not the way to EVER get ahead. Try buying something that you can pay for -- and if you can "afford" to make payments - make that payment to your savings account instead of to the lender. Next time you go to the "jacked up truck store" -- I'll bet you look at that pile of cash it took you 5 years to save, a little differently. Guaranteed you won't be in such a big hurry to piss it away.

[WSSix]

I always like the "I can afford it" statement when it comes to MAKING PAYMENTS....

NO..... if you're making payments..... then YOU CAN NOT AFFORD IT. Affording it means you bought it - straight up. Period.

Putting 10% or less down on a house..... Yeah - NO. You really shouldn't be in that house (YET).

Being in debt on depreciating assets.... Yeah about that.... Not the way to EVER get ahead. Try buying something that you can pay for -- and if you can "afford" to make payments - make that payment to your savings account instead of to the lender. Next time you go to the "jacked up truck store" -- I'll bet you look at that pile of cash it took you 5 years to save, a little differently. Guaranteed you won't be in such a big hurry to piss it away.

That's basically what happened to me when I was still working for Halliburton in Kansas. I really wanted a 01-06 GMC Duramax 2500 with 4 doors and 4WD in dark blue. I could easily have afforded it paying cash etc. But, I'm sitting there doing my thing in the back of my wireline truck going into hour I don't know for the day because I had lost count and started doing the math. Even though I could easily have bought a ~$20k truck, I decided that I was better off doing something else with the money because of how much time, since time is money after all, I was basically spending to buy the truck. I decided my time was worth more than a really sweet truck.

Hell, I'm doing this again right now. I'm seriously looking at 540i BMWs instead of M5s simply because I don't want to spend the money. Never mind that I can afford the M. My time is worth more and it's just a toy. So I'll go get my jollies in the 540 with all that extra cash in my pocket.

[captainofiron]

I think you guys are hitting on a few good points that people often over look. Debt has been talked about here before but I'd wager a lot of people, for whatever reason, put their daily drivers in the "necessary debt" category and I disagree completely. My Tahoe is a 2006 that I bought two years ago with 135k. I'm looking at buying another toy that's less than 15k and at minimum 15 years old. I won't carry debt on them. My fiancee's Fit is a 2010 model that's long been paid for. Car's today are very reliable for the most part. Buying a used or older one for cash frees up so much money to be put into assets that actually appreciate. No car any of us are going to buy and use as a daily will appreciate. Unless you can write it off for work/taxes, it's costing you money. Finding ways to minimize that cost is great. Apply that same perspective to areas of your life where it's relevant and see how much more money you suddenly have available. I just think a lot of people aren't willing to truly be honest with themselves concerning what they really need to spend their money on. If they would, I think they'd be better off financially.

That's a really great point

All of our cars are paid for, the only time we've not paid cash is because our credit Union had .56% interest

[captainofiron]

My daily is a 2002 with 230,000 miles on it, no plan on upgrading it anytime soon. Wife's is a bit newer 2012 with 110,000 miles. Both owe me nothing...

Newish Escalades and Mercedes SUVs rule my neighborhood, along with new jacked up 4x4 trucks. I'm betting the majority of them have larger car payments than my mortgage payment. :relax:

One of my coworkers, younger guy, has very nice cars and I was always curious how he managed to pay for it all. I finally found out at his going away party, he found a higher paying job, he rolled his car payments into his refinanced mortgage....:G-Dub::G-Dub:

[Vegas69]

Reminds me of a quote I've shared before:

"The cost of anything is the amount of life you're willing to trade for it."

You don't think your trading life for debt, think again.

Maybe it's 2 missed suppers with your family every week or your kids baseball game to eek out another deal.

Maybe it's a Saturday at work instead of doing something you want to do.

Regardless, debt can put an anvil around your neck. Count the costs...

[vdrivinmike]

I always like the "I can afford it" statement when it comes to MAKING PAYMENTS....

NO..... if you're making payments..... then YOU CAN NOT AFFORD IT. Affording it means you bought it - straight up. Period.

Putting 10% or less down on a house..... Yeah - NO. You really shouldn't be in that house (YET).

Being in debt on depreciating assets.... Yeah about that.... Not the way to EVER get ahead. Try buying something that you can pay for -- and if you can "afford" to make payments - make that payment to your savings account instead of to the lender. Next time you go to the "jacked up truck store" -- I'll bet you look at that pile of cash it took you 5 years to save, a little differently. Guaranteed you won't be in such a big hurry to piss it away.

Greg:

Awesome advice. IF ONLY, I learned this 10 years earlier than I did (like 6 years ago)....

[vdrivinmike]

My daily is a 2002 with 230,000 miles on it, no plan on upgrading it anytime soon. Wife's is a bit newer 2012 with 110,000 miles. Both owe me nothing...

Newish Escalades and Mercedes SUVs rule my neighborhood, along with new jacked up 4x4 trucks. I'm betting the majority of them have larger car payments than my mortgage payment. :relax:

I relate 100% here in Orange County. I actually take a good amount of ribbing for my 03 F-150 XLT daily driver.

[GregWeld]

I relate 100% here in Orange County. I actually take a good amount of ribbing for my 03 F-150 XLT daily driver.



I've had so many friends "talk themselves into" buying or leasing something brand new..... because...... their old one "might" break down and cost them money.

Super smart people! Let's spend 50 grand on a depreciating asset to save having to rebuild a $2500 transmission.... And by the way -- if you don't have the $2500 -- then FOR SURE you shouldn't be buying anything!! LOL WTF

UGH -- just shoot me!

[GregWeld]

Well..... here we go!!


The idiots at the FED are just bound and determined to wreck a good thing....


Headline today.


Mortgage rates jump past 5%, signaling more home price cuts ahead

Next up will be a slowing in the car biz - and the resulting layoffs.....

[WSSix]

Everything dropped hard today. Just when I thought I was gaining some serious steam. Oh well, there's always tomorrow.

[toy71camaro]

Looks like another rough day today.

Granted, i've got quite a few years ahead of me, so the downturn may just be a good opportunity to put some more money to work. ;)

[Vegas69]

Well..... here we go!!


The idiots at the FED are just bound and determined to wreck a good thing....


Headline today.


Mortgage rates jump past 5%, signaling more home price cuts ahead

Next up will be a slowing in the car biz - and the resulting layoffs.....

I personally think things need to cool down a bit to avoid a huge mess like last time.

[GregWeld]

I personally think things need to cool down a bit to avoid a huge mess like last time.




With a 7% decrease in mortgage applications - you might just get your wish!

[Vegas69]

Sweet, more time to have some fun. :lol:

[SSLance]

And just like that...BAM...my portfolio is back up to pre-correction highs.

Thanks PG...

[GregWeld]

And just like that...BAM...my portfolio is back up to pre-correction highs.

Thanks PG...



Good Lance. The only losers are the people that think long term is Tuesday at 2.....

Basic investing is about fundametals. Is business good? Are companies profitable? Are they growing or laying off..... in other words - until things CHANGE the swings are just noise.

Pay attention to fundamental change - are we beginning to see sales slowing - house prices dropping - sales slowing - layoff announcements etc — then you want to think about selling some stuff and raising a little or a lot of cash —- but right now - if you’re paying any attention - you’re not hearing any of that kind of talk. Housing tanks first —- this is something to really pay attention to now and for next couple quarters (as rates rise).

[GregWeld]

Yale economist Robert Shiller has joked about how there's nothing special about a year. Twelve months "is the time it takes the Earth to go around the sun," he says. "I don't see any other significance."

If a stock, bond, or fund is down for the 12 months from one particular January to December, how much should you care? What if it's back to positive returns by the next February, or April, or December?

[Flash68]

Speaking of Shiller... the Case-Shiller Home Price Composite Index was a ground breaking development in tracking (and helping predict) RE price trends when it was released.

Carry on, Greg. LOL

[captainofiron]

I work at a start up, so we have plenty of rich investor types come in, most of them are pretty cool and I regularly chat with one of them about investments and frugality (think Mr Money Mustache)

The other day he was talking about how he is building up his savings to buy a bunch of assets when the market crashes in the next year or 2

this got me thinking... A LOT

what all are you guys doing to limit the damage if the market crashes or if we hit another Great recession? Any tips for us lowly newbs? haha

[GregWeld]

I work at a start up, so we have plenty of rich investor types come in, most of them are pretty cool and I regularly chat with one of them about investments and frugality (think Mr Money Mustache)

The other day he was talking about how he is building up his savings to buy a bunch of assets when the market crashes in the next year or 2

this got me thinking... A LOT

what all are you guys doing to limit the damage if the market crashes or if we hit another Great recession? Any tips for us lowly newbs? haha



Great question — and the correct answer is..... “it depends”. Depends on your time horizon — depends on your job security — depends on your debt load...

Dodging the question? Nope....

But “trying to time the market” is almost impossible - even if you’re a professional. The correct way for the average guy to invest is to invest when you have the money... particularly if your horizon is 5 / 10 /20 years. The idiots that BAILED out of stock that they’d bought high going in to 2009.... and SOLD... they lost their you know what. Was there a bunch of handwringing and worry while the market sunk 40%... you bet! But had they held the course - and in fact bought instead of sold - they’d have made a bundle plus.

I do investing AND I also “trade” a bit.... very little on the trading - but if Amazon is going up and down $50 a day - I might play with that a bit... but that’s a whole different question — but to answer your question — right now I’m not buying much of anything because nothing seems to be working. So I’m long cash and sitting back to see what happens.

HOWEVER — my CORE investments don’t change very much because that’s where my income comes from - and they keep paying dividends regardless of their stock price...

If your horizon is “retirement” — and you’re investing in your 401/IRA/ROTH — just keep buying and putting money to work. We’ve discussed this all in the thread a million times.

If you have a 2 or 3 year horizon — that’s pretty short term and if that’s the case — and you’re going to need the money for something — then taking some profits (or selling some losers before they’re bigger losers) never hurts.

[captainofiron]

Great question — and the correct answer is..... “it depends”. Depends on your time horizon — depends on your job security — depends on your debt load...

Dodging the question? Nope....

But “trying to time the market” is almost impossible - even if you’re a professional. The correct way for the average guy to invest is to invest when you have the money... particularly if your horizon is 5 / 10 /20 years. The idiots that BAILED out of stock that they’d bought high going in to 2009.... and SOLD... they lost their you know what. Was there a bunch of handwringing and worry while the market sunk 40%... you bet! But had they held the course - and in fact bought instead of sold - they’d have made a bundle plus.

I do investing AND I also “trade” a bit.... very little on the trading - but if Amazon is going up and down $50 a day - I might play with that a bit... but that’s a whole different question — but to answer your question — right now I’m not buying much of anything because nothing seems to be working. So I’m long cash and sitting back to see what happens.

HOWEVER — my CORE investments don’t change very much because that’s where my income comes from - and they keep paying dividends regardless of their stock price...

If your horizon is “retirement” — and you’re investing in your 401/IRA/ROTH — just keep buying and putting money to work. We’ve discussed this all in the thread a million times.

If you have a 2 or 3 year horizon — that’s pretty short term and if that’s the case — and you’re going to need the money for something — then taking some profits (or selling some losers before they’re bigger losers) never hurts.

Awesome thanks

Ok so you wouldn't do anything like change asset mix or something along those lines?

My horizon right now is hopefully ~10 years, my goal is to retire before I'm 50 and be able to live off of 4% of our portfolio

The wife and I are trying to save at least 25% of our income, lately I've been putting this into either VTI or FZROX

I've been using FZROX kinda like a savings account

Speaking of savings accounts, I've transferred all our savings (emergency fund and car fund) to an online bank with 1.9% vs .25% at our credit union

[SSLance]

We have a savings account at Capital One that is FDIC insured and paying 2% on balances with no fees or restrictions. Just food for thought.

I'm with Greg, powder dry holding course and collecting divies...

[pontiacgtp97]

We have a savings account at Capital One that is FDIC insured and paying 2% on balances with no fees or restrictions. Just food for thought.

I'm with Greg, powder dry holding course and collecting divies...

I have the same type account. When I opened it, Capital One was paying a $500 bonus for opening the account.

[Flash68]

:tiptoe: Makes sense to me.

https://www.cnbc.com/2018/11/19/goldman-sachs-believes-the-us-economy-will-slow-to-a-crawl-next-year.html

[GregWeld]

If you’re INVESTED in the things we’ve discussed here (not names but the premise for good investing) — then everyone will be fine and will be rewarded.... Let the few down days or periods shake you out.... and you’ll never catch up... Choose WISELY — don’t be greedy — stay the course - get the rewards.

[XLexusTech]

If you’re INVESTED in the things we’ve discussed here (not names but the premise for good investing) — then everyone will be fine and will be rewarded.... Let the few down days or periods shake you out.... and you’ll never catch up... Choose WISELY — don’t be greedy — stay the course - get the rewards.

I am with you ... been buying for about 15 years .. only thing I sell are losers just enough each year to get 5he tax benifit.... I know it’s situational your horizon is and lifestyle are huge...

But is their ever a time to take some of you winnings off the table ? Even it you plan to buy the same holding back later at a lower share price?

I am being advised to take some money off the table but I am struggling

[Flash68]

I guess there's that old saying.... no one ever got hurt taking a profit. :)

Happy Thanksgiving all.

[XLexusTech]

I guess there's that old saying.... no one ever got hurt taking a profit. :)

Happy Thanksgiving all.

Yep just not sure how to take some profit without getting hit with taxes? I don’t want to end up in a higher tax bracket or pay short ter rates.:

Pardon my ignorance those both nay be completely wrong assumptions?

[WSSix]

Is it in a tax sheltered account like a Roth IRA? If not, you can only lessen your tax percentage by making sure the profit qualifies as capital gains as far as I know. To qualify for capital gains, the stock you sell needs to have been bought 366 days before. Otherwise, it'll be counted as ordinary income and be taxed as such which could put you into the next tax bracket.

I'm not sure what will happen if this is inside a 401k. Please make sure you don't put yourself into a position where you get penalized for selling stock. I believe the 401k only faces penalties if you take any money put in out ie not profit but the original purchase/contribution. However, what qualifies as taking money out? I don't know. It might be something dumb like when you roll over a 401k from one employer to the next it's imperative the money never be sent to you even if you turn right around and send it to the next employer's 401k.

[dhutton]

You can sell stock within an IRA and 401k without paying tax.

Don

[XLexusTech]

These would be outside a 401k and I think I can select the ‘lots’ I can sell from and be over any cap gains

Here is an example I purchasec Facebook at the IPO

How can I take some of that money off the table without it being income tax?

[GregWeld]

These would be outside a 401k and I think I can select the ‘lots’ I can sell from and be over any cap gains

Here is an example I purchasec Facebook at the IPO

How can I take some of that money off the table without it being income tax?



Losses on your investments are first used to offset capital gains of the same type. So short-term losses are first deducted against short-term gains, and long-term losses are deducted against long-term gains. Net losses of either type can then be deducted against the other kind of gain.

SO —- in other words —- if you have some losses you plan to take anyway — see that they’re long term or short term losses — harvest those - calc your loss and take a matching gain.... bingo — zero tax

[XLexusTech]

Losses on your investments are first used to offset capital gains of the same type. So short-term losses are first deducted against short-term gains, and long-term losses are deducted against long-term gains. Net losses of either type can then be deducted against the other kind of gain.

SO —- in other words —- if you have some losses you plan to take anyway — see that they’re long term or short term losses — harvest those - calc your loss and take a matching gain.... bingo — zero tax

Ahh ha Eureka! I recently sold DBD at a loss which I held for years.. I can take the los amount and take that dollar amount in gains fro FB provided they are both have been own for more than 1 year Sound right ?

[SSLance]

Sounds correct... And sound advice Greg.

[XLexusTech]

Sounds correct... And sound advice Greg.

For those following along... "Tax loss harvesting" is the term to search for to get more info.... here is a link with some good info

https://www.investopedia.com/articles/financial-advisors/121914/pros-and-cons-annual-taxloss-harvesting.asp

[toy71camaro]

Things have been dropping for a while.. anyone putting more cash to work, or waiting it out a bit longer?

[WSSix]

I did. I was getting some good deals. Could have waited til today and gotten better deals but that's ok. It'll rebound. I'm getting slaughtered though that's for sure. I am glad this isn't my income or job.

[GregWeld]

Well...... you girls lived thru some of the worst stock market action in a decade.... and I’ll bet ya all did just fine.

[SSLance]

Sitting back and grinning like a cat that caught and ate the mouse here...

[Vegas69]

Well...... you girls lived thru some of the worst stock market action in a decade.... and I’ll bet ya all did just fine.

Didn't even look..

[XLexusTech]

Didn't even look..

Me either 🥂

[shelteredV]

I refuse to look. Maybe next year I'll look. Oh wait....

[WSSix]

lol, nope! I've been slaughtered. I'm not concerned though. I'll continue to collect dividends, make my regular purchases, and see where the market wants to go. I am thinking I will just let Vanguard manage my Roth IRA entirely from here on out though, or especially for now in this volatile market. I still have my Fidelity account that I manage.

[Kx69]

Try crypto. Go to crypto.com and download their app, use the referral code 2MSAAO91KO and get a free $80 in crypto to play with or cash out. Don’t invest more that you are willing to lose!

[SSLance]

Crossed back over another threshold the last couple of days... My investment accounts are back up to all time high values. :)

It's been pretty fun just sitting back and watching my Dividend Investment Growth strategy do it's thing.

[RKROEGER]

Now I'll have to check mine...

[WSSix]

I haven't fully recovered but I've definitely rebounded tremendously.

[barrrf]

Anyone like NASDAQ: CRON for long term?

Ive got rail, oil, renewable energy, semiconductor, medical devices, and auto in my portfolio currently but am not in any organics per se.

[GregWeld]

Anyone like NASDAQ: CRON for long term?

Ive got rail, oil, renewable energy, semiconductor, medical devices, and auto in my portfolio currently but am not in any organics per se.


I’ve got 9,000 shares of Canopy Growth (CGC) —- for no other reason than it’s Constellation Brands association.....

These are going to be very volatile — and who knows which one, or ones, are going to be take over candidates - or actually make it etc.

I think you “have to” be invested in stuff like this — in a relative way of course - and the younger (more time) you are the better.

[rustomatic]

If you look at the charts, pot stocks are like potheads: not all that trustworthy. They get sold off en masse on a daily basis. Try Ford, maybe after they go bankrupt from recalls . . .

If you don't have an eye on it every day, the pot stock will take your money and spend it on batteries and Cheetos.

Anyone like NASDAQ: CRON for long term?

Ive got rail, oil, renewable energy, semiconductor, medical devices, and auto in my portfolio currently but am not in any organics per se.

[barrrf]

If you look at the charts, pot stocks are like potheads: not all that trustworthy. They get sold off en masse on a daily basis. Try Ford, maybe after they go bankrupt from recalls . . .

If you don't have an eye on it every day, the pot stock will take your money and spend it on batteries and Cheetos.

You know that not all growers are for medicinal smoking right? I think with states considering it legalization that there is some potential but I agree its going to be volatile and who knows which ones will be the winners, like the next cryto craze.

But something that is happening quietly, imo, is the rise of CBD consumption. The rise of CBD consumption in the pharma industry would seem to indicate a demand. And with the talks of beverage companies coming out with CBD infused products, I dont want to miss an opportunity for good growth.

Idk. Could also just be a flash in the pan.

[GregWeld]

You know that not all growers are for medicinal smoking right? I think with states considering it legalization that there is some potential but I agree its going to be volatile and who knows which ones will be the winners, like the next cryto craze.

But something that is happening quietly, imo, is the rise of CBD consumption. The rise of CBD consumption in the pharma industry would seem to indicate a demand. And with the talks of beverage companies coming out with CBD infused products, I dont want to miss an opportunity for good growth.

Idk. Could also just be a flash in the pan.

We never really know about “new” industries like this — all you can do is to be your own “brain” — is this something you see as having potential — can you “afford” to gamble with some portion of your investable assets and see it potentially go to zero - or can you stomach the assault that is surely going to hit you with every up and down?

Investing like this is NOT 101 —- it’s for more advanced investors who understand all the possible pitfalls and possible upsides.... In other words — who the heck knows??? I sure don’t. But I can afford to put some dough up and see where it goes. It’s not for the faint of heart.

[rustomatic]

The pot stock thing has already happened--many of us may have been too busy eating Twinkies to catch it (I was). The good point here is that the "legalized" version of the industry is new, as far as Wall Street goes. That said, the industry is by no means run like regulated industries (being that there is a lot of cartel involvement, not that they don't dip their toes in Wall Street's pool). They're still trying to figure out how to regulate it and so far, they have managed to make the illegal stuff more affordable and attractive all over again. Much like the crypto business, there has been a lot of scamming in the financial sector. Of course there is demand for the thing itself . . .

In getting back to the stock, since the stocks are still relatively new (and played out quickly), they trade like newer stocks, with lots of volatility (which is not a bad thing, so long as you actively manage your holdings). So long as you can ignore the cable-news version of volatility, like it's some kind of bad word, you can benefit from it, but you have to work with it. You cannot be passive.

While a lot of algorithmic trading (60%+ of the market's activity) sticks to large caps like Apple and GM, it also finds a home in the craps, like ACB and NBEV (popular pot stocks). So, if you look at a chart for Ford or GM, you'll see a trend line that goes for a year, but with a pot stock, the line on the graph will go for a week or two. The modern stock does not have a long-term brain.

An hour or two (or twelve) using the resources available free on Yahoo!finance (not the videos) can provide a great deal of helpful enlightenment here.

Term of the day: Average True Range

[SSLance]

So I own a little bit of Garmin... GRMN

Had a real nice surprise when I downloaded quotes this am...

:) :trophy-1302:

[captainofiron]

With the Fed leveling out the rate hikes is it time to pull the money and run?

Serious question

I have been buying index funds vs individual stocks the past 8-12 months, and I had been thinking about stopping my positions (in my IRA) and putting it I the index funds

But if a recession is coming maybe hiding part of it in bonds?

This really has me feeling anxious like I haven't felt about my portfolio for a really long time

[GregWeld]

With the Fed leveling out the rate hikes is it time to pull the money and run?

Serious question

I have been buying index funds vs individual stocks the past 8-12 months, and I had been thinking about stopping my positions (in my IRA) and putting it I the index funds

But if a recession is coming maybe hiding part of it in bonds?

This really has me feeling anxious like I haven't felt about my portfolio for a really long time




If I think the market is headed south —— I begin to stash cash vs continue to buy — and I WAIT for the market to come down and then I begin to BUY —- nibbling wait — nibble again....

Selling out trying to figure the market is going south —- that’s called “MARKET TIMING” — it never works well.

Here’s what happens to your mental state — you were thinking about selling because you were nervous — you don’t because you can’t make up your mind — then “whatever it is” you were waiting for does finally happen in some form - AND THEN YOU SELL....... losing money and licking your wounds.

Investing is like getting married — you should be in thru thick and thin - in sickness and in health....

When the market sells off — like a 2008/09 event — and stays down — it gives you an opportunity to average your costs down by buying MORE shares for less cost.... the longer that opportunity lasts — the more time you have to put money to work at lower costs.... by averaging down like this — the market has to come back “less” for you to break even - or begin to show a gain. It’s like — you always wanted a 56 Corvette but they were out of reach — and all of a sudden the market collapses the price..... by half. You buy one that was 100% better condition than you’d dreamed of and drive it and love it.... and you hold it and polish it for 7 years.... and the market all of sudden snaps back and your lovely 56 doubles in value back to it’s pre collapse value. You’re looking pretty smug now.

The reason I advocate DIVIDEND PAYING STOCKS — they keep paying you whether the market is up or down or sideways.

[captainofiron]

If I think the market is headed south —— I begin to stash cash vs continue to buy — and I WAIT for the market to come down and then I begin to BUY —- nibbling wait — nibble again....

Selling out trying to figure the market is going south —- that’s called “MARKET TIMING” — it never works well.

Here’s what happens to your mental state — you were thinking about selling because you were nervous — you don’t because you can’t make up your mind — then “whatever it is” you were waiting for does finally happen in some form - AND THEN YOU SELL....... losing money and licking your wounds.

Investing is like getting married — you should be in thru thick and thin - in sickness and in health....

When the market sells off — like a 2008/09 event — and stays down — it gives you an opportunity to average your costs down by buying MORE shares for less cost.... the longer that opportunity lasts — the more time you have to put money to work at lower costs.... by averaging down like this — the market has to come back “less” for you to break even - or begin to show a gain. It’s like — you always wanted a 56 Corvette but they were out of reach — and all of a sudden the market collapses the price..... by half. You buy one that was 100% better condition than you’d dreamed of and drive it and love it.... and you hold it and polish it for 7 years.... and the market all of sudden snaps back and your lovely 56 doubles in value back to it’s pre collapse value. You’re looking pretty smug now.

The reason I advocate DIVIDEND PAYING STOCKS — they keep paying you whether the market is up or down or sideways.

Thanks for the "chill pill" reality check haha

I appreciate it

I think I just need to pay less attention to the talking heads

[GregWeld]

Thanks for the "chill pill" reality check haha

I appreciate it

I think I just need to pay less attention to the talking heads



You do have to place a little blind faith in to the “process”. The market goes up and down and sideways...... but that’s why I refer you to the OVERALL charts going out longer term!! Lower on the left - higher on the right.....

Now — the other thing is — people want to focus on their “mistakes” vs the ones they got right — That’s when you need to remain calm - examine the individual company (investment) and either trim it over time - or do you think it can stage a comeback —- think Chipotle (CMP)..... so is the downturn in the name a missed whisper number - or is it fundamental etc - you have to examine what’s going on - and whether or not it’s a buy - hold - or sell. And remember - the day after you sell - it will go up and the day after you buy it will go down.

[Tinker]

The market goes up and down and sideways......And remember - the day after you sell - it will go up and the day after you buy it will go down.

Not always Gregg. A few years ago I had dumped a certain stock that varied from $60-80 a share at $105. The next day it went down and I was the smartest man around. Lol Well...3 years later it hovers around 300 a share, and I dumped six figures worth.

[GregWeld]

Not always Gregg. A few years ago I had dumped a certain stock that varied from $60-80 a share at $105. The next day it went down and I was the smartest man around. Lol Well...3 years later it hovers around 300 a share, and I dumped six figures worth.

I have a long list of those....... Chipotle - Amazon - Microsoft - McDonalds.....

I was able - thru a friend - to get STARBUCKS at the IPO price.... bought 1000 shares — flipped it out a couple days later because it was up 50 cents - thought I’d skinned a fat cat making $500 in a couple days.....

Yeah - I was brilliant wasn’t I??

[GregWeld]

I had to go do some research on Starbucks (SBUX) to see what it’s long term price had done since I had my big flip and gain of $500’


If you account for splits - the 1992 price per share would be .45 (forty five cents) per share —- it’s current price is almost 16,000 % gain since inception (IPO)


So - I had 1000 shares at @ total cost of $14,000 (IIRC) —- X’s 16,000%

Just quickly — I think that would be worth about 2.2 MILLION today

[Tinker]

[QUOTE=GregWeld
Just quickly — I think that would be worth about 2.2 MILLION today[/QUOTE]

Just think, you could have bought ten more piles of crap! Lol
(Too soon yet?)

[GregWeld]

Just think, you could have bought ten more piles of crap! Lol
(Too soon yet?)

I still can.......


Never too soon! I make more fun of the POS (Pile of Sauce) than anyone.

[Vegas69]

No regrets fellas... It's really easy to make decisions looking backwards.

[Tinker]

No regrets fellas... It's really easy to make decisions looking backwards.

None here Todd, and yes a crystal ball would be handy.

[glassman]

Saw a Warren Buffet quote on IG today, "the rear view mirror in business is much cleaner than the windshield"

Yet if we spend too much time looking back, we'll trip on what's ahead....

[Vegas69]

I spent too many years on the only if's.... I can honestly say I have not one regret and I've done some really stupid stuff. After all, mistakes are some of the best experience. I do think you need to be willing to learn and change your ways in the process.

[SSLance]

I know I'm not supposed to do this, but it was so glaring I had to check. My investment accounts are up 5% since Jan 1 2019...

This last week has been crazy green for me....

[GregWeld]

I know I'm not supposed to do this, but it was so glaring I had to check. My investment accounts are up 5% since Jan 1 2019...

This last week has been crazy green for me....



This is why you can’t be a market timer — because if you sell every time you get worried — the market will snap back and run on you and then all you do is end up with cash that needs to be put to work - -and thus you buy at ever higher prices.... TIME IS THE GREAT MAGIC — Not timing.

[GregWeld]

Watching CNBC this morning and all the discussion about “Streaming”.... Apple - Netflix - Disney - Hulu..... everyone wants you to sign up for their streaming service and cut the cable

Why mention this? Because I got to thinking that AT&T bought Direct TV (cable) for growth — and assumed massive debt for the purchase. My millennial children don’t have or want cable - they have streaming stuff.....

Just remembering “fundamental change” in your holdings — and is this one??? The death of a 1000 cuts — or was it a brilliant move? IDK — just saying to pay attention.

[WILWAXU]

Watching CNBC this morning and all the discussion about “Streaming”.... Apple - Netflix - Disney - Hulu..... everyone wants you to sign up for their streaming service and cut the cable

Why mention this? Because I got to thinking that AT&T bought Direct TV (cable) for growth — and assumed massive debt for the purchase. My millennial children don’t have or want cable - they have streaming stuff.....

Just remembering “fundamental change” in your holdings — and is this one??? The death of a 1000 cuts — or was it a brilliant move? IDK — just saying to pay attention.

Yup, as soon as cable internet like speed is available elsewhere, the cable companies are toast.

[SSLance]

I'm a cord cutter...been 2 years now without cable TV. So I'm experienced with that side of this discussion.

I also own AT&T and am a bit upside down in it since the DTV purchase. So also familiar with that side...

What I know now is that streaming ain't all it's cracked up to be. There is nothing free about any kind of good content and what you can stream is getting so filled up with ads that you can't skip that it's frustrating to watch. Hulu, youTubeTV and such are now all raising their subscription fees and the cord cutters are raising heck about it. Not only that but fast internet ISPs are raising their rates largely as well. My 100 mbps Cox connection just jumped from $69\month to $99\month.

I'm still not sure where it's going, but I know having a cable\Sat DVR with the ability to easily record and skip commercials on playback is still the best way to watch ANY TV programming. It's just not worth $200\month to this user. For now the Cable\Sat companies seem to be happy jacking up the rates to the subscribers they have left to keep their profit margins in line, the more subs they loose, the higher they jack rates. At some point one would think they will dial that back to get the Subs back that get tired of the unskippable ads and expensive internet the streamers are stuck with.

I suspect the build out of the 5G network nationwide will dictate the next move on both sides...and this part I'm less knowledgeable about.

[Vegas69]

I can barely watch cable TV. The commercials are ridiculous. I have to be really tired a looking for something mind numbing. I end up on Netflix most of the time.

On the flip side, I noticed Amazon is getting into prescription drugs. A to your door type deal. I'm a bit down on CVS and it makes me look to consider unloading it in the short term.

[GregWeld]

I can barely watch cable TV. The commercials are ridiculous. I have to be really tired a looking for something mind numbing. I end up on Netflix most of the time.

On the flip side, I noticed Amazon is getting into prescription drugs. A to your door type deal. I'm a bit down on CVS and it makes me look to consider unloading it in the short term.



I continue to hold on to a couple hundred shares of Amazon (AMZN).

#1 — I buy EVERYTHING from them

#2 — The Web services biz is still growing

#3 — They seem to have smart people at the top

[spacepirate]

Spectrum (Time Warner) is now offering cell service and uses the Verizon platform and towers. I was paying $80 for Verizon and Spectrum was offering the same plan for $45. (However, you had to have either internet or tv through them and I already used them for internet) I actually jumped ship and now have a plan with Spectrum and have the exact same coverage. You can tell the Cable guys are moving trying everything they can to bring in new clients.

[GregWeld]

Best advice ever —- what I’ve been saying since the first post — pick good well known names and places you shop or do biz with.... spread it thru sectors.... but he says it is broader brush stroke.... the KEY takeaway?? Don’t listen to the BS!!






Warren Buffett has some very simple advice for investors.

“All you have to do is just buy a cross-section of America and then never listen to people like me or read the papers or do anything subsequently,” he said in an exclusive interview with Yahoo Finance’s editor-in-chief, Andy Serwer.

[GEARBOXGARAGE]

Watching CNBC this morning and all the discussion about “Streaming”.... Apple - Netflix - Disney - Hulu..... everyone wants you to sign up for their streaming service and cut the cable

Why mention this? Because I got to thinking that AT&T bought Direct TV (cable) for growth — and assumed massive debt for the purchase. My millennial children don’t have or want cable - they have streaming stuff.....

Just remembering “fundamental change” in your holdings — and is this one??? The death of a 1000 cuts — or was it a brilliant move? IDK — just saying to pay attention.

I've been reading up on this a little too, more specifically who will come out on top in the wireless world... AT&T or Verizon. While AT&T's primary investment has been buying up other Telecom companies, Verizon's main investment has been their network in hopes of being better prepared for the coming 5G signal, which will better support the demand of everyone streaming everything.

Even though I've been a fan/customer of Verizon for many years, they both tell a compelling story in their theories of best growth practices. While AT&T currently has to work through a mountain of debt from all of their acquisitions, if and when they bring that to a zero balance, they could become the top contender if played right. But on the other hand, I think Verizon is poised to run away with the market by shoring up their foundation first. Just my .02 cents.

[glassman]

I continue to hold on to a couple hundred shares of Amazon (AMZN).

#1 — I buy EVERYTHING from them

#2 — The Web services biz is still growing

#3 — They seem to have smart people at the top

Two questions

A- do you think the stock (AMZN) will ever split? (i own 2 shares)
B- does it matter?

[GregWeld]

Two questions

A- do you think the stock (AMZN) will ever split? (i own 2 shares)
B- does it matter?

Good question Mike..... and the answer to A is IDK....

The answer to B is — yes and no.

The P/E ratio doesn’t change - so the stocks actual representative value is static....in the sense that a split doesn’t “Add” value... but making the stock affordable to purchase by a broader range of investors, I think would help it increase in price.

Someone like me that buys 10,000 to 30,000 shares of a name — and I hold 200 of Amazon (AMZN)? But the point of making it more or less valuable doesn’t change....

Let’s say they did a 10 for 1 — so I’d now have 2000 shares... Now does it go up and down $2.00 a day vs $20 ?? Doesn’t really matter... it’s the same money.

[GregWeld]

Let’s go back a few years — since this thread began — and all the original contributors - asking questions - question #1

Isn’t the market too high and should I wait for it to come down.......


To which I repeatedly stated....


The chart is lower on the left and higher on the right.....


So I ask the old folks here —- a rhetorical question.


Do ya think ya shoulda waited???? LOL


My last post to this thread - ever. I’ve made all the points I could ever make. Take it and run with it — or sit on your hands and fret.

[XLexusTech]

Let’s go back a few years — since this thread began — and all the original contributors - asking questions - question #1

Isn’t the market too high and should I wait for it to come down.......


To which I repeatedly stated....


The chart is lower on the left and higher on the right.....


So I ask the old folks here —- a rhetorical question.


Do ya think ya shoulda waited???? LOL


My last post to this thread - ever. I’ve made all the points I could ever make. Take it and run with it — or sit on your hands and fret.


Thanks for the guidance ..” so long and thanks for all the fish”.

Ps I hope that made you smile

[RKROEGER]

Greg, I'd like to say thanks for all your guidance. I pay much more attentin to my retirement since this thread started. My son manages his own Roth account with Schwab from his phone. I got him to start w/$1200.00 when he was 12.$1300. when he was 13. He's now 20 and actually knows more about money management than I ever did when I was 40. This is all thanks to you and all the other contributors to this thread. Thanks sincerely.

[WILWAXU]

Let’s go back a few years — since this thread began — and all the original contributors - asking questions - question #1

Isn’t the market too high and should I wait for it to come down.......


To which I repeatedly stated....


The chart is lower on the left and higher on the right.....


So I ask the old folks here —- a rhetorical question.


Do ya think ya shoulda waited???? LOL


My last post to this thread - ever. I’ve made all the points I could ever make. Take it and run with it — or sit on your hands and fret.

Greg,
As many have said, thank you for your effort in this thread. As I told you in person, I am literally 6 figures ahead of where I was when this thread started. I attribute 99% of that to the knowledge gained here. Thanks for all that you do!

[toy71camaro]

You Da Best, Greg!

You've peaked my interest in the financial world. I preach these concepts now to anyone who'd listen.

Thanks for always helping us out, and putting it in car guy terms. ;)

Now... were's that Investing 103 thread at..... :idea:

[mdprovee]

Thanks Greg for your help and guidance. My fund has just grown and my dependence on credit has diminished since reading this thread. Cant thank you enough, you are the best there is!!!

[LuxurySportCoupe]

Thanks Greg! I wouldn't have started investing or understood the importance of it at all if it wasn't for this thread. Thanks for showing us new ways to think about finances!

[captainofiron]

so I recently liquidated my holdings in STX, I didnt like the volatility of the stock and nand memory

I liked the dividend but after a few years of being positive, I was underwater with them for ~6-7 years

Anyways this june they went up to my cost basis and I jumped

Any suggestions what tech company is looking solid right now?
I was looking at IBM, I like their dividend and its a big name and seems like they are better diversified in terms of revenue streams than Seagate

Another name that I thought of was intel, but not sure

thoughts? suggestions?

I am very leery of the FAANG stocks

[captainofiron]

Let’s go back a few years — since this thread began — and all the original contributors - asking questions - question #1

Isn’t the market too high and should I wait for it to come down.......


To which I repeatedly stated....


The chart is lower on the left and higher on the right.....


So I ask the old folks here —- a rhetorical question.


Do ya think ya shoulda waited???? LOL


My last post to this thread - ever. I’ve made all the points I could ever make. Take it and run with it — or sit on your hands and fret.


:bow::bow::bow::bow::bow:

Thanks Greg

my portfolio is what it is because of your advice, and since starting reading this thread I am more than double where I Was

[SoloTech]

Just found this thread mucken' around the forums. Some good advice buried in here!

[WSSix]

We hope it helps you out.

[captainofiron]

So I figured I Would keep the fun up in this thread.

Not sure if its a Investing 102 level topic, but my employer just rolled out an ESPP (employee stock)

its pretty good, you get a 15% discount on a three month lookback

So I am going to start buying the max and immediately selling, I was looking into it and to get a tax advantaged sell I have to hold it for 2 years...

so I have decided to sell it and add it to my portfolio

In addition to that, I am targeting to retire early in the next 10-15 years

10 might be tight with the 4% rule, but 15 is 100% doable

I am thinking try to partially retire in the next 10 and still work part time

That being said I just bought some MSM and KMI right before the exdiv date :G-Dub:

[SSLance]

Did a bit of year end calculating yesterday. Our retirement portfolio is 42% invested in growth dividend stocks and the rest is in cash and we still managed 11.9% return for 2019.

I'm perfectly happy with that. I imagine those that were more fully invested did much better.

Happy New Year everyone.

[Flash68]

My IRA is mostly invested in stocks.... up 23% in 2019. Decent. :)

Happy New Year.

[WSSix]

Same. My professionally managed portfolios did very well in 19. My brokerage account that I manage, not so much, lol. I'm still too invested in oil in that account to have any big changes currently. I'm still loving the dividends though so I'm just let it continue to sit.

Hope 19 was good for everyone else, too. Here's to a great 20, as well. :trophy-1302: :G-Dub:

[SSLance]

I feel like this is the time Weld would be telling us to hang tight... We all bought quality companies and they'll be the first ones to recover once the nonsense goes away.

Personally, I think the huge players are the ones driving this spiral...building opportunities strictly for themselves. Long ago I would have been anxious but thanks to the learning gathered in this thread...I'm still sleeping well.

[glassman]

I feel like this is the time Weld would be telling us to hang tight... We all bought quality companies and they'll be the first ones to recover once the nonsense goes away.

Personally, I think the huge players are the ones driving this spiral...building opportunities strictly for themselves. Long ago I would have been anxious but thanks to the learning gathered in this thread...I'm still sleeping well.

I hear Greg in my head saying "there has been no fundemental changes in the good dividend paying companies you've chosen, so, wait it out"

If my dad, whose broke at 75 years old, had just "let it ride" during the 08/09 fiasco, he'd have about a mill in the market, collecting his 5-7% (of taxable) inclome plus SS.

Nothing wrong with working til u die, just don't "have' to work....

[rustomatic]

It's a fun week if you're in Dow industrials . . . :disgusted:

If you're in biotechs, you might retire early (this week). :G-Dub:

The best learning comes, usually, only with pain. I learned that from Rocky (who ironically didn't seem to learn much through all of those sequels).

Passive investing, to place Rocky in the spotlight yet again, is about as good as blocking punches with your face right now. Can you stomach a 4000-point dip?

There's a happy medium here somewhere, perhaps in the sense that peripheral vision (i.e., research with an open mind) can do wonders for your outlook, so long as you take the time to develop it. This statement has cost me thousands, by the way . . .

[XLexusTech]

It's a fun week if you're in Dow industrials . . . :disgusted:

If you're in biotechs, you might retire early (this week). :G-Dub:

The best learning comes, usually, only with pain. I learned that from Rocky (who ironically didn't seem to learn much through all of those sequels).

Passive investing, to place Rocky in the spotlight yet again, is about as good as blocking punches with your face right now. Can you stomach a 4000-point dip?

There's a happy medium here somewhere, perhaps in the sense that peripheral vision (i.e., research with an open mind) can do wonders for your outlook, so long as you take the time to develop it. This statement has cost me thousands, by the way . . .


Which Bio techs ? :headspin:

[WSSix]

Yep, I've already moved money into the brokerage account so I can buy as soon as things start turning around. I really don't understand this dip. Sure, I expect a lot of companies to be affected by the virus, but not to this extent. I think people are just panicking to panic. The media isn't helping either. So I'll just sit back and wait patiently.

I do like the bit I heard about one company that makes masks suddenly having their stock go through the roof :lol:

[Vegas69]

Greg also taught us not to catch a falling knife.

All it takes for a market to change is pessimism and fear. One of my good buddies was freaking out this week because Sam’s club was out of tee pee. Apparently there is a supply buying frenzy out there. Many in society are so warped by the media and it’s really too bad. Personally, I’m 20+ years away from withdrawing any retirement funds so it can do whatever. Next time the market makes a big run, it may be time for some change in my strategy. At some point a hair cut effects the lifestyle you’ve planned and invested to provide. Don’t wait until it’s too late to ride out another cycle.

[Flash68]

I feel like this is the time Weld would be telling us to hang tight... We all bought quality companies and they'll be the first ones to recover once the nonsense goes away.

Personally, I think the huge players are the ones driving this spiral...building opportunities strictly for themselves. Long ago I would have been anxious but thanks to the learning gathered in this thread...I'm still sleeping well.

I think Greg would have sold some positions to rebuy on the dip. How many is anyone's guess.

[XLexusTech]

I think Greg would have sold some positions to rebuy on the dip. How many is anyone's guess.

Agreed. I had a crazy year and I wanted to take some money off the table. Doing so was gong to be at a big tax burdon as i was alreay in the 35% bracket... so I didn't. I still buy 2x a week and dollar cost average... so long run this dip should work in my favor .. assuming it bounces back before 2023 (my retirement year goal)

[rustomatic]

Monday's looking like more of the same thing: going south.

While last week's "good times" actually gave a lot of traders a terrible day(s), many had a good week last week trading (not investing) in companies that are claiming to be working on vaccines and whatnot for coronavirus. As Trey mentioned, even companies that sell painter's/SARS masks had their stocks skyrocketing last week (Home Depot even put sales limits on them). We're talking multiples of doubling in value, some going many, many times their value. Generally, these are crappy companies, however, and you do not want your money near them long-term or passively . . .

Example tickers found here: https://finviz.com/.

The point here is that in stocks, there is always a bright side, so long as you are willing to burn your money in a Dumpster fire! :relax:

[JKnight]

And yet...today turned out to be a day with the biggest single day upside since 2009...Stay the course my friends, none of us will time each big move perfectly.

[WSSix]

and today was crap again, lol. Wild swings for sure. The only move I've made so far is on a utility because it's a utility. It should be largely unaffected by all of this. I figure it's panic for sure in this area so I'll take advantage of the situation.

My Hasbro is looking great right now, but it will be affected by what's happening in China. Long term I expect it to be fine so I'll probably move on it soon. I fully expect it to take time to recover. It's just at a great price point for me right now.

[JKnight]

Seriously, crazy times we’re living in for sure! We knew we had to be close to the next recession, but who knew what the catalyst would be this time. The fact that the market dropped this badly on the same day the Fed cut rates 50 bps is really telling about the level of pandemic concerns. We may see a good bit more downside, but things are definitely on sale compared to a few months ago! I’ll try to keep gathering cash and be ready to deploy when things start to stabilize.

[rustomatic]

Good points here, especially regarding the rate cut. The first thing that came to mind when word on that came out was the following: confidence in corporate U.S.A. When the last big dip in Dec. of 2018 happened, there was a lot more talk of the impossibility of the big companies being able to handle the present pile of commercial paper (read: massive debt). In other words, the Fed is making moves that should creep us out, but they'll be the last ones to explain . . .

On the positive side, biotechs and other panic-related stocks are still puttin' out. Volatility can be fun, but very expensive.

Seriously, crazy times we’re living in for sure! We knew we had to be close to the next recession, but who knew what the catalyst would be this time. The fact that the market dropped this badly on the same day the Fed cut rates 50 bps is really telling about the level of pandemic concerns. We may see a good bit more downside, but things are definitely on sale compared to a few months ago! I’ll try to keep gathering cash and be ready to deploy when things start to stabilize.

[Vegas69]

It seems to me that the government is trying to escape the natural laws of this life. That being the ebb and flow of everything. Does the economy really need stimulated again? All I can think is that when the old you know what hits the fan, it will be worse than if they would just leave well enough alone. Unemployment is the lowest it's been in 50 years! Real estate values have recovered, people are making money, the stock market is at record levels. Maybe they should've saved that mulligan for another day.

[XLexusTech]

its not as bad as you think... Granted... it dipped but the bottom has not fallen out .... stay the course my friends.. Long game and don't try to time the market... look for great deals on dip and dont panic..

[WSSix]

That's basically why I went ahead and completed my moves today. I was looking at the present values and they were all below if not well below my cost basis and their recent values. I figured, I'm buying on sale. It may not be the best sale price but it's still on sale. I expect more volatility concerning the Coronavirus and, more importantly, peoples reactions to the virus. Nothing I just did was on a massive scale, but I don't think I missed an opportunity. In the end this will pass and it'll all work out.

[JKnight]

Todd, truer words have rarely been spoken. I think you’re right, the economy didn’t need that move and with every cut they reduce the effectiveness of the tools in their arsenal.

I agree with you guys. I also gotta say the ideals Greg preached in this thread have given me a little more confidence these days by reinforcing what I was kinda/sorta/pretty sure I already knew.

[Roscoe03]

A lot of stocks on sale at the moment with the whole OPEC issue and it's a sea of red in my portfolio but I gotta think long term!

[XLexusTech]

A lot of stocks on sale at the moment with the whole OPEC issue and it's a sea of red in my portfolio but I gotta think long term!

Looking for deals .. :y0!:

[WSSix]

For sure. This is too cheap to ignore. I've already moved more out of savings. Again, nothing major as I still want to be balanced and secure in all my accounts.

[toy71camaro]

Shopping for deals here too! :D :D

[glassman]

Nice to see you chime in Albert, hope all is well....

This market is getting more and more sensitive, very roller coastery

I haven't bought much on my own, just maxing out my 401k safe harbor plan (26k for me 26k for wifey) and have a small independent manager/broker doing it. No sure I'll be able to retire in 7 years (61), but the house is almost paid for (1.3 here in the Bay Area) and business is paid for, so, overall inhttps://lateral-g.net/forums/images/smilies/thankyou.gif pretty good shape.

But, the old adage is invest in what you know, and I sell a ton on melted sand. On the other hand, I need divi's that pay when I'm a sleeping...

[toy71camaro]

Mike,

All is great here! trying to enjoy this nice weather (except for today). Baseball season has started and kept me busy (coaching 14u boys) and spare time enjoying a new toy I got last year (09 HD Dyna). First bike. Been fun!!

Anyhow, I had a little capital set aside (about 20%) since I rolled my old 401k into a roth a year and a half ago. I've put about 10% to work in the past couple weeks sell of, into solid dividend champs. still waiting to figure out where the bottom might be for the other $ to get put in. Aside from that, my parents asked me to take over their 401k as they're just hitting retirement. Luckily they sold everything to move it to an IRA mid 2019. I've slowly been creeping in on this big downturn, its been great timing on that front. lol. But again, still waiting to see how bad this gets. They've still got about 60% not invested yet. Again, long term big name brands with long histories of dividends that start low on the left and high on the right. Just like good ole Greg taught us.

Been an interesting couple weeks. Hard not to buy buy buy when it keeps going all red like this! lol

[rustomatic]

Nothing like a Trump tweet to change one's financial picture . . . Ouch!

[Vegas69]

I don't know fellas, things may just be going on sale. I won't quit my normal retirement contributions, but I'm not parting with my cash just yet.

[toy71camaro]

I don't know fellas, things may just be going on sale. I won't quit my normal retirement contributions, but I'm not parting with my cash just yet.

Yeah... I think I'm going to hold out longer before putting my cash to work. With the announcements like the NBA and NCAA events, I think there will be more red days to follow, with more panic to ensue. Of course I could be totally wrong. I'm definitely not an expert nor did I sleep at a holiday inn last night. lol

[Vegas69]

Your guess is as good as anybody’s!

[SSLance]

As long as this is on the news 24/7, we aren't at the the bottom. Powder staying dry here...

In 2008 we were heavily into High Yield Bond funds and got hammered relentlessly. I can still remember the feeling of just getting kicked in the stomach continually for doing nothing wrong. It soured me horribly on the market as a whole and it took a lot of prodding by GW and you guys to get me back in.

This time around, I'm much more confident in our choices and see the forest through the trees so to speak.

I'm more concerned about the safety of ourselves (and others mainly). Have 3 sets of friends and relatives with plane tickets bought to go somewhere that are heavily considering their options. One is a couple in their late 70s leaving on a 6 week (bucketlist) trip to Australia next week. Those are the HARD decisions that will have to be made.

[XLexusTech]

Yeah... I think I'm going to hold out longer before putting my cash to work. With the announcements like the NBA and NCAA events, I think there will be more red days to follow, with more panic to ensue. Of course I could be totally wrong. I'm definitely not an expert nor did I sleep at a holiday inn last night. lol

trickeling in buys on good equities that are way down buyt I am still up 100% or 200% on ..

and adding cash so I be ready to fire when ready

[BonzoHansen]

As long as this is on the news 24/7, we aren't at the the bottom. Powder staying dry here...



.

I agree. Sadly i think we have more drop ahead.

More time to research and buy. A lot of quality on sale.

[rustomatic]

There is always a sale, but the one ya'll might be looking for is not on yet. It's time to put on your 2008 glasses (we're all that old, right?) and cinch up your out-of-date harnesses . . .

Yeah, I'm a bummer, but all need to begin seeing the collateral damage that will come from the actual economy and what it is about to become. Save some money, and leave some toilet paper on the shelf for your neighbors.

Get outside and breathe in an open space. Invest in good beer and exercise. I did this by riding my bike to a local brewery in the all-too-rare sun yesterday. It was perfection . . . money and energy well spent. :headspin:

[glassman]

^^^^true dat

[68454RS]

Maybe a dumb question but, i'm completely ignorant to this stuff..
Would y'all recommend putting a hold on my company 401K paycheck contributions for the time being to have more cash available or just keep taking the deduction and making the contributions. I'm doing a 20% contribution at this time.
thx

[Vegas69]

It depends....

Age?
Do you have 6+ months liquid for an emergency right now?

I personally plan to keep buying monthly, but I may adjustment my risk level in my accounts. I don't retire for 22+ years.