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Also all of you who think a retirement stock portfolio is a panacea are living in a dream world. This year so far the stock market has done nothing. Your assets have stayed the same. However when you factor in inflation you've lost 20% of the purchasing power. You'd have been better off spending all your money on clothes and groceries and stuff you'll need to buy and will have to pay twice as much for if we have four more years of Obama or four years of Romney with no changes at the Federal Reserve. At least if you stock piled stuff like that you wouldn't have to buy them in the future paying a hnigher price with dollars worth a lot less. GET IT? No financial advisor is going to tell you this. They hardly understand Austrian Economics.
Excellent post!
I have been doing this! I shop at yard sales and thrift stores and buy clothes, shoes and other items for $1 or so each. I like high quality hiking type clothes that tend to last a long time.
I scan the grocery sales every week and when food items I use are at rock bottom price (I keep track of prices on things I use) I stock up. A while back dry beans (garbanzo, kidney, pinto) were on sale for $1/lb (reg 2.49/lb), a good price around here, so I bought a lot, 20 lbs! I am keeping an eye out for them to go on sale again so I can buy more.
I am concerned about food prices rising due to the economy and the drought in the midwest and I plan to do even more diligent stockpiling. We want to eat food bought at the lowest possible price.
(Check out the Tightwad Gazette for pricebooks and the pantry principle.)
Also all of you who think a retirement stock portfolio is a panacea are living in a dream world. This year so far the stock market has done nothing. Your assets have stayed the same. However when you factor in inflation you've lost 20% of the purchasing power. You'd have been better off spending all your money on clothes and groceries and stuff you'll need to buy and will have to pay twice as much for if we have four more years of Obama or four years of Romney with no changes at the Federal Reserve. At least if you stock piled stuff like that you wouldn't have to buy them in the future paying a hnigher price with dollars worth a lot less. GET IT? No financial advisor is going to tell you this. They hardly understand Austrian Economics.
1 year investing in stocks vs 49 years (age 16 to 65) investing in stocks. Yeah, these are exactly the same thing. <sarcasm>
Do some homework, and try to find a 49 consecutive year period of time where "the stock market has done nothing."
(spoiler alert: you won't find one)
I think people are misreading the article -- the problem is not just that Americans aren't saving enough, but also that with no knowledge of the stock market will not make the right investments.
This is very true. However, the information is readily available and generally free or low cost. (Public libraries, Half-Price Books, Google searches (from the free public library computers))
Why do you expect most people with a semi decent high school education to resist the best advertizing to spend everything you make and all you can charge ever created. Commercial advertizing never says save all you can. It tells you to spend, spend and spend more. If you think the boomer generation failed to save enough just think what is going to happen to the current generation that will not have company pensions or, if you believe some people, any Social Security and are likely to have their investments eliminated by one financial collapse or another before they can retire.
Imagine what protests would start if some High School math teacher started teaching kids to save instead of spend. He would be lynched in front of the nearest Wall-Mart.
Also all of you who think a retirement stock portfolio is a panacea are living in a dream world.
I don't know anyone who thinks that. What many think is that owning equities in a retirement portfolio increases your chances of meeting savings goals because of the greater growth potential over time. That isn't the same as a panacea.
Quote:
Originally Posted by emilybh
This year so far the stock market has done nothing. Your assets have stayed the same. However when you factor in inflation you've lost 20% of the purchasing power.
You are claiming that the inflation rate is 40% if you've lose 20% of purchasing power since January. Despite what your little fearmongering youtube videos tell you, that is absurd.
Also DJIA started year at 12,217 and is now at about 12,700. I know I shouldn't expect much from someone who believes we are experiencing 40% inflation but 12,217 -> 12,700 certainly isn't "nothing" that is a solid return for the first seven months of the year.
Quote:
Originally Posted by emilybh
You'd have been better off spending all your money on clothes and groceries and stuff
Since all the premise you've used (stock market doing nothing, delusional view on inflation rates) have been faulty your poor conclusions on best path to financial security should be expected. Enjoy your elder years of poverty among huge piles of clothes and food.
I think people are misreading the article -- the problem is not just that Americans aren't saving enough, but also that with no knowledge of the stock market will not make the right investments.
That philosophy was true back in the days before the bailouts and before the Clinton years when NAFTA was signed and we started hearing the GIANT SUCKING SOUND of jobs leaving this country and factories shutting down. Another little "present" Clinton gave us was giving the UN Control over our future lives and liberty and property in something called "Agenda 21" and urban planning "sustainable development".
It wasn't quite so obvious that things were going to get really bad really quickly. 9/11 hadn't happened yet.
As far as I'm concerned the best days for investing in the stock market were in the mid 80's. You could check the newspaper every week and see that your various no load common stock funds that you chose yourself were humming right along as you predicted they would. Not everyone had a PC yet and certainly not everyone had access to the internet.
People still had privacy and property rights. You could be late for an international flight, get their 15 minutes before take-off and get on the plane WITHOUT ANY HASSLES! There was no security other than metal detectors. Food and utilities and Gas were a tiny FRACTION of what they are today. You could get a college education from a nationally recognized or internationally recognized university for $16k FOR ALL FOUR YEARS!
Back then the advice was to be conservative and only plan on a growth rate of 6 or 7 or 10-12% max and invest accordingly figuring out also what you'd need to withdraw and when.
THOSE were the GOOD OLD DAYS WHEN YOU HAD SOME CONFIDENCE THAT THE FUTURE MIGHT JUST BE A REPEATor extentson OF THE PAST. But NO MORE. Those days are LONG GONE. Now the advice should be to make sure you are as self-sufficient as possible because with such a weak currency as ours and so many irresponsible banksters and spineless congressmen allowing them to do what they want with it. Even millions of dollars if all of a sudden the dollar doesn't buy anything, will be WORTHLESS. Now the advice should be to buy TANGIBLE ASSETS. Actually it has been that for a while as the smart money has been buying gold and has been out of the stock market for ages.
The other thing people have to keep in mind about the stock market is: are your assets backed by the dollar or another currency? Hopefully for you the answer is another currency as all are expected to do better than the dollar in the long run. See, these are the things even todays best trained CFPs won't tell you.
As far as I'm concerned the best days for investing in the stock market were in the mid 80's. You could check the newspaper every week and see that your various no load common stock funds that you chose yourself were humming right along as you predicted they would.
Really? The dow lost over 4% in the year 1984, and stock market lost over 20% in one day in 1987. There was never any "humming right along as you predicted" the stock market has always gone up and gone down, it is for long term investing you accept the bumps in hopes of achieving gains over time.
Quote:
Originally Posted by emilybh
Now the advice should be to make sure you are as self-sufficient as possible because with such a weak currency as ours
No, that is not what the advice should be. One person's slow descent into irrational paranoia does not good investing advice make. Should one be prepared? Sure! Have an emergency fund, pay off your debt, try to develop skills that can bring income in a changing world, all good stuff. But when you start claiming the dollar is going to collapse or people should be all in gold instead of the stock market you are giving irresponsible advice that is best left to the loonies who slurp up Alex Jones videos on youtube.
Quote:
Originally Posted by emilybh
The other thing people have to keep in mind about the stock market is: are your assets backed by the dollar or another currency? Hopefully for you the answer is another currency as all are expected to do better than the dollar in the long run.
The stock market is an investment in businesses, what currency you wish to denominate the value of these companies in isn't relevant. They aren't "backed" by any currency.
Quote:
Originally Posted by emilybh
See, these are the things even todays best trained CFPs won't tell you.
Well gosh thanks for your insider tips! We at CityData are so lucky the person who advocates investing in clothes and food since we are currently experiencing 40% inflation rate is kind enough to share the wisdom.
If you have a survivor beneficiary for an annuity, you will get considerably less income from your investment. They cover all the angles.
Are you talking about ANY annuity, or some sort of social security annuity?
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