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I always found it interesting how many run high equity allocations and don't even flinch at these big drops.
In fact, many look at them as a buying opportunity.
I started out as a person who refused to sell at a loss. At least, until the price went down to going out of business sale prices. Probably 80% recovered and very little of the rest lost it all. I got smarter during the 2007-2008 downturn. I sold the ones I thought were going nowhere and added to the ones I thought would recover. While I wasn't always right, the outcome is that I'm well ahead of my high points just before the downturns.
I agree with you that those who are now hurting, likely got out near the low point and stayed out during the upswing.
just by being in a mutual fund, pension fund etc you already are one of the big boys.
the big boys are the institutions that we all make up.
we have met the enemy and he is us.
I never invested seriously in anything but funds and hitting 1 million was a no brainer.
A couple of life changers,
I used to live not to far away from you. Back in the 70's I was lucky enough to get in to Queens College when it was not just a great school, but for the most part - free. Several of my schoolmates took out maximum student loans every year? I asked why they would do that considering it cost nothing to go to QC? They said were taking the money and investing it in Magellan? No idea what it was. I never had the nerve to do it myself, but I learned what investing was and that was how people made money. Granted it was a leveraged investment but with a deferred payback at 7% on an investment that returned close to a 30% annual average for over a decade?
I was called to jury duty one summer, Queens County Courthouse. While parked in the huge pool room hoping to not get called, they had a guy come in from Social Security, I was all of 21, could care less about SS, till he said I wouldn't be able to collect until I'm almost 67 years old? Seriously?
I made it a point after to that to look beyond salary. I got an entry level job with a large company (part of the DJIA) and took advantage of their 401K. A few years later I saw a job posting for a company (also on the DJIA) that offered a good salary, but more importantly - a pension plan and a matched 401K. I applied and I've been there ever since. Pension plan is gone now, but the 401K match was increased.
Like you said YOYO investing. Absolutely blows my mind how many of my co-workers much younger than me avoid the equity options on our plan. The performance and return information is there, the fees and costs are there. Nope . . .
There is a theory/philosophy that pension income should be treated like bonds as you calculate your asset allocations. Under that thinking many of us should be very comfortable with high equity asset allocations. It us food for thought and discussion elsewhere. But for many retiree's it is food.
Very true , same as annuities should be counted. In fact a study was done using annuities and stocks with no bonds and it had very had favorable results.
if anyone wants to read it I will find it and post it.
I used to live not to far away from you. Back in the 70's I was lucky enough to get in to Queens College when it was not just a great school, but for the most part - free. Several of my schoolmates took out maximum student loans every year? I asked why they would do that considering it cost nothing to go to QC? They said were taking the money and investing it in Magellan? No idea what it was. I never had the nerve to do it myself, but I learned what investing was and that was how people made money. Granted it was a leveraged investment but with a deferred payback at 7% on an investment that returned close to a 30% annual average for over a decade?
I was called to jury duty one summer, Queens County Courthouse. While parked in the huge pool room hoping to not get called, they had a guy come in from Social Security, I was all of 21, could care less about SS, till he said I wouldn't be able to collect until I'm almost 67 years old? Seriously?
I made it a point after to that to look beyond salary. I got an entry level job with a large company (part of the DJIA) and took advantage of their 401K. A few years later I saw a job posting for a company (also on the DJIA) that offered a good salary, but more importantly - a pension plan and a matched 401K. I applied and I've been there ever since. Pension plan is gone now, but the 401K match was increased.
Like you said YOYO investing. Absolutely blows my mind how many of my co-workers much younger than me avoid the equity options on our plan. The performance and return information is there, the fees and costs are there. Nope . . .
I have jury duty in a few weeks at the queens county courthouse
But again ,many are quite successful and alot of being successful is having the nerve to do what others fear.
All ya have to do is I think is 'hope for the worst and you'll never be disappointed!'...;-)....Builds my nerve all the time in YOYO (heheh) investing. Love it.
And btw if I can go off-topic a bit, it was a dismal day when the City University system dissolved 'free' tuition. Frankly, THAT took me outta poverty when I went to CCNY. It altered and prepared me for life at the same time. Looking back on that scenario my 'ROI' was incredible, absolutely stunning. It's a shame really that it had to go. Always kind of makes me think so one does'nt have money to fund a college eduicatoion. Why does it neceassarily have to bar pr put impediments to you if you want to learn and 'get an education?' But that's for another place!
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