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Fritz
Trad climber
Choss Creek, ID
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I would advise someone who is not ok with investment risk to avoid the stock market. If you can't afford a loss every now and then, you shouldn't be in the market.
If you are in the market, but not an expert, I would also council you to invest in mutual funds with low annual fees.
In my humble opinion, Vanguard is the biggest, safest, & best of the low fee mutual fund companies.
Their mutual funds that track the S&P 500 are likly the safer stock funds, but I especially like their somewhat higher risk Health Care Fund. With an average annual return of 17.63% over the last 29 years & low annual fees, it has been a smile-maker for me.
https://personal.vanguard.com/us/funds/snapshot?FundId=0052&FundIntExt=INT#tab=0
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Reilly
Mountain climber
The Other Monrovia- CA
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Fritzi speaks verily although risk is a function of yer investment timeline.
If you are under 50 you probably don't want anything to do with bonds, especially now.
Even if you are 60 it is highly probable that you will make it to at least 75
which means buying the Vanguard S&P 500 Index fund is actually a good move
as it is highly likely that the upside outweighs the downside. If you
are closer to 70 than you are to 60 then putting half your money in the S&P 500
and half in a bond fund (or two - one domestic + one international) would be
more prudent. You would be well advised to only put 1/4 to 1/3 in the S&P 500
fund and the remainder of that 'half' in an international fund for diversity.
You can never be too diversified. Think of diversification as extra pieces
on a long pitch. While Fritzi's Healthcare fund has done well by him it should
be noted that it merits a '5' for risk and goes against the Rule of Diversification.
One last observation: index funds outperform the vast majority of 'managed' funds
and they have the big added advantage of having much lower management fees.
Note to zBrown - if I only made 4% on my investments I'd be tempted to slit my throat, if I
wasn't such a coward. Yer primary residence is yer worst investment. It is only made bearable
by the tax benefits and the fact that it mostly beats being homeless.
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Fritz
Trad climber
Choss Creek, ID
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Yea verily! Reilly speaks more truth:
Think of diversification as extra pieces on a long pitch. While Fritzi's Healthcare fund has done well by him it should be noted that it merits a '5' for risk and goes against the Rule of Diversification.
One last observation: index funds outperform the vast majority of 'managed' funds and they have the big added advantage of having much lower management fees.
Heidi & I are invested in 4 Vanguard bond funds (all short term or muni at the moment) & 7 Vanguard stock funds. Unfortunately, every time I've owned an international stock fund, I lost my ass. It's ok though, since most of the Vanguard stock funds I own also have international stocks in them.
The least risky Vanguard Index fund we own, with stocks in it, is the Star Fund which is 60% stocks & 40% bonds. Not a bad return either & of course very low annual fees.
Of course Risk = Reward, unless it's a "sucker-bet."
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zBrown
Ice climber
Brujò de la Playa
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So Reilly, are you homeless or do you rent?
I believe from what I've seen elsewhere there may be a few readers who do not have the option of deciding whether to purchase stocks or bonds.
4% compound translates to 10.9% average annual increase, the one stocks/bonds folks like to quote
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JEleazarian
Trad climber
Fresno CA
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In my opinion this is a no risk investment.
In my opinion, colored by 42 years as a professional economist and 36 as a bankruptcy lawyer, a no risk investment does not exist. Finding a no-risk investment is like trying to predict precisely where lightning will strike on Half Dome this year. It's a pretty good bet that it has and it will, but I have no idea where or when.
That said, disciplined, diversified investing has historically grown in value -- in the aggregate -- reliably over the years.
John
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Reilly
Mountain climber
The Other Monrovia- CA
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zBrown, don't we all rent from the bank or the mortgage company? That said,
I'll be beholden to nobody in two years whereupon a 28' Airstream might be
looking gud. But then we're also talking about putting everything in storage
and just traveling full time. We could rent apartments for a month or two
at a time and still save money. The only trouble is that I haven't been able
to find any apartments in Angmagssalik, Greenland. :-(
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zBrown
Ice climber
Brujò de la Playa
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I suppose someone's house could be hit by lightning or there could have been a fraud and forgery involved,
but that's why folks have escrows and insurance.
There could be an act of God
or a war.
Shitt!! happens even to the best of us.
“The lawyer was bad enough
But this is ten times worse”
Just then a bolt of lightning
Struck the courthouse out of shape
And while ev’rybody knelt to pray
The drifter did escape
$$$
Married folks can exclude $500,000 of gain from taxes, repeatedly to infinity (if you live that long) as long as you comply with the rules.
$$$
Shit!! and peepee does happen. If you weren't born here, don't bring your camper here and poop here.
[Click to View YouTube Video]
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Roger Brown
climber
Oceano, California
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ZBrown,
Investing in our home worked for us. Paid off long ago, and doubled in size. It is worth 3 times what we paid including the 2 story addition. We have no regrets having most of our funds in savings. We sleep good at night.
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pyro
Big Wall climber
Calabasas
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Aug 24, 2015 - 11:36am PT
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..........Your gonna die.....
damn that was a drop!
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Roots
Mountain climber
Tustin, CA
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Aug 24, 2015 - 02:51pm PT
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..us youngsters have time....ok I'm not young anymore but I don't panic.
Silver anyone? Been selling below what they can extract it for, so it seems like a bargain to me.
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Ricky D
Trad climber
Sierra Westside
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Aug 24, 2015 - 03:05pm PT
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You can never go wrong by going long on canned goods and bullets.
I also suggest a few cases of can openers - helps you corner the market after the crash.
The bullets you can use to threaten the Mormons in your neighborhood if they balk at turning over their food hoard.
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paul roehl
Boulder climber
california
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Aug 24, 2015 - 03:10pm PT
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A crash is but a buying opportunity.
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Reilly
Mountain climber
The Other Monrovia- CA
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Aug 24, 2015 - 03:36pm PT
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A crash is but a buying opportunity.
OK, Warren. ;-)
I will be buying in a major way after the dust settles so I can see the
openings in the battle line. Oil stocks will be very attractive shortly.
Quite interesting that the Chinese gubmint did nothing to staunch the
blood flow in Shanghai today. I aver that the commissars reworded a previous
phrase of "Let them eat cake." Me? I'm putting it down to
"Karma's a bitch muthafukkas. Hope you can eat your poached elephant tusk art!"
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John Duffield
Mountain climber
New York
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Aug 24, 2015 - 03:57pm PT
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I can't remember our stock market getting this bent out of shape over China.
Has to be a ruse.
I think the Brokers are stampeding the vacationing herd to make a nice lil Summer bonus.
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zBrown
Ice climber
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Aug 24, 2015 - 04:04pm PT
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Didn't The Dow develop napalm and agent orange, among other good for the Earth products.
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StahlBro
Trad climber
San Diego, CA
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Aug 24, 2015 - 04:07pm PT
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Better to put your faith in the Tao
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