raeoflyte
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Joined: Feb 3, 2011 15:43:53 GMT -5
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Post by raeoflyte on Nov 26, 2021 11:02:42 GMT -5
If I remember correctly in 2009, wall street, which is who I consider the house, came out pretty well. There were a lot of people that needed to dip into their investments that year, like my parents, that lost a lot. I'm not saying don't invest, just don't pretend it's risk free and everyone makes money. It's just not true. I don't intend anything I say to be a comment on real estate either way. And it's riskier using borrowed money. Did they really LOSE money though because they had to sell when it was down? I mean look at the bottom of the dip in 2009 compared to just 12 years earlier and by 2012 it had almost fully recovered, and now it's up nearly 600% since then. Average of about 16%/year. I think the lesson is to have a few years worth of "safe" investments to ride out the dips. What's a good goal? 10 years expenses in bonds?
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buystoys
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Joined: Mar 30, 2012 4:58:12 GMT -5
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Post by buystoys on Nov 26, 2021 12:03:42 GMT -5
Did they really LOSE money though because they had to sell when it was down? I mean look at the bottom of the dip in 2009 compared to just 12 years earlier and by 2012 it had almost fully recovered, and now it's up nearly 600% since then. Average of about 16%/year. I think the lesson is to have a few years worth of "safe" investments to ride out the dips. What's a good goal? 10 years expenses in bonds? I keep a percentage of our total retirement money in bonds: about 30%. I also keep about 5% in cash. The other 65% is in equities. We take out less than 3% out every year, so you could say we've won our race. I might go to more equities in the future, but the only winner of more money would be a charity.
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Deleted
Joined: Apr 25, 2024 10:56:55 GMT -5
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Post by Deleted on Nov 26, 2021 13:18:55 GMT -5
What's a good goal? 10 years expenses in bonds? That seems awfully conservative to me but it really varies. First of all, if interest rates go up the market value of your bonds will go down- but not a problem if you plan to hold them to maturity. It depends on what you MUST withdraw to meet spending in a typical year. I have only about 7 months' worth of expenses in money market funds but do have another 3 years' worth in bonds. OTOH, 40% of my spending is either travel or charity and those could be cut back in a downturn. I could also withdraw from the cash in my IRAs since I'm 68 but the tax consequences would be pretty bad. When I read about retirees who "lost all their savings" in a market crash I suspect it was because they still had to withdraw $XX,000/year to meet expenses and it became an unsustainable $ of their assets.
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tallguy
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Post by tallguy on Nov 26, 2021 13:37:08 GMT -5
That would sound great to me... as long as I could cross the 1 off the front.
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minnesotapaintlady
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Post by minnesotapaintlady on Nov 26, 2021 14:01:26 GMT -5
What's a good goal? 10 years expenses in bonds? I'm personally sticking with 2-3. That would have been enough to ride out most dips in the past...with the exception of the Great Depression.
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