Budget Be Damned

[RealSailing]

It's great that you have been able to do so well, and you are clearly comfortable with your situation. But for others who are thinking this will work the same way for them, please understand that the annual rate of return of the S&P500 over the last 18 months has been about 14.3% on an annual basis, which is exceptionally good. As indicated, the markets do generally go up, to the extent that over the last 15 years the average return has been about 6.8%. But some years have seen steep declines, just as the last 2.5 years have had great returns. Using your numbers, only factoring an assumed market return of 6.8% instead of 14.3%, the net cash burn would have been $110K, rather than $10K.

This is not to say we shouldn't go cruising, but if someone starts out with the same nest egg and hits a down market (rather than a 14% or even a 6.8% increase), the pot can evaporate much more quickly than this post implies.

[Whisper 2]

What is SS?

[FlyingScot]

Originally Posted by Whisper 2

What is SS?

https://en.wikipedia.org/wiki/Social...(United_States)

[a64pilot]

Originally Posted by Kenomac

I find you post personally offensive on several levels.

I'm giving up on this ridiculousness. Not because of anything Sailorboy has written or attempted to provide information on, but because of all the idiotic responses to anything I write.... yours is a good example. I would never write something like you wrote online about a fellow cf member; you may think it’s funny, but I don’t.

Have a nice day.

You know it wasn’t meant to be offensive, it was a joke, hence the smiley face, you know that.
However you continually try to act as if investments are a bad thing for some reason, however it’s obvious you must have income from somewhere other than your work, which I believe shows your smart, you have obviously taken money you worked for and earned and made some smart investments, cause no of course I don’t think your making drugs or printing money.
But you have to admit, it’s very unlikely that an RN (I assume RN) could accumulate two Oysters, Ferraris and the toys you have on the money made from three months nursing a year.

It’s not meant as as anything but a compliment. You have I assume lived the American Dream and accumulated quite a bit of wealth.

So why do you act as if investing is bad? How have you accumulated your wealth? I know of rental property as you have posted about that, but then you say the man with 9 rental properties was foolish for having rental properties?

[a64pilot]

By the way, I apologize if I offended, I assure you that wasn’t the intent

[a64pilot]

Originally Posted by Trimaran Ken

Believable, yes. Stupid, yes.

If you have solid investments, they will eventually come back. If you have risky investments, bail out before it is too late.

Ken
===

Ah, but as you know, how do you tell when it’s time to bail?

Making money in the market is simple, any idiot can do it, all you do is buy low and sell high right? What could be easier than that?

Now I agree with you, reason I didn’t and won’t buy bitcoins or whatever the latest get rich quick thing is, because all that money made came from somewhere, it came from people losing their behinds that’s where.

[Trimaran Ken]

Originally Posted by a64pilot

Ah, but as you know, how do you tell when it’s time to bail?

You never know for sure, but if I had 1 mil in my retirement fund and it dropped to 900k with no clear indication it would not go lower, I would make sure I didn't loose any more, or at the very least, lower the risk level of my investments so if things continued to go down, I would loose less.

Much better to loose 10% than 60%.

For many years, I tracked the average risk level of my investments compared to the S&P. I kept mine a little below the S&P.

Ken
===

[Kenomac]

Originally Posted by a64pilot

You know it wasn’t meant to be offensive, it was a joke, hence the smiley face, you know that.
However you continually try to act as if investments are a bad thing for some reason, however it’s obvious you must have income from somewhere other than your work, which I believe shows your smart, you have obviously taken money you worked for and earned and made some smart investments, cause no of course I don’t think your making drugs or printing money.
But you have to admit, it’s very unlikely that an RN (I assume RN) could accumulate two Oysters, Ferraris and the toys you have on the money made from three months nursing a year.

It’s not meant as as anything but a compliment. You have I assume lived the American Dream and accumulated quite a bit of wealth.

So why do you act as if investing is bad? How have you accumulated your wealth? I know of rental property as you have posted about that, but then you say the man with 9 rental properties was foolish for having rental properties?

You apologize, then follow it up with another derogatory insult...

Just how much money do you think us butt wipers should be allowed to make? I know of many... yes many Registered Nurses and LPN nurses here in the US who earn a very good living through specialized work, by working many hours, even multiple jobs and then investing the proceeds in conservative sound investments.

I suggest you refer your comments and questions to other CF members in the future... I'm not amused by your dribble.

Good day. (No smiley face)

[pt49]

Having been a forex trader on n off for a long time... making and losing good money... I used my knowledge of reading charts to decide to buy Bitcoin about 4 or 5 months ago @ $3,300. It is now up about 100% in 4 months.
Needless to say I only invested enough to buy a 45' 20 year old yacht in good condition if Bitcoin goes up another 1000%.

[picklesandjesse]

Originally Posted by pt49

Having been a forex trader on n off for a long time... making and losing good money... I used my knowledge of reading charts to decide to buy Bitcoin about 4 or 5 months ago @ $3,300. It is now up about 100% in 4 months.
Needless to say I only invested enough to buy a 45' 20 year old yacht in good condition if Bitcoin goes up another 1000%.

What about those ETN people ???

[valhalla360]

Originally Posted by Kenomac

Back in 2006, we met a guy who claimed that he was “all set and retired with 8 rental properties down in Florida;” another customer I knew had over $1,000,000 in his retirement account that was invested in stocks... he’d just retired.

2008.... all eight of the first guy’s rental properties were being auctioned off by the bank along with his 9th which was his primary residence, and the newly retired guy who now had only $400k remaining in stock was looking for a job in a very down job market at age 62.... hopeless, for someone in engineering at the time. His wife’s horses were up for sale.

Who's the radio guy with the tag line...and now for the rest of the story?

Markets didn't go down 60% and I assume the guy with rental properties was in debt up to his eyeballs when things went south...so what is the rest of the story.

[valhalla360]

Originally Posted by Checkswrecks

The problem with the buy and hold, it'll always recover philosophy is that recovery may take longer than we have to live. For example from the 30s till 50s and late 60s till early 90s. Meanwhile, inflation doesn't cease so getting back to the same number will buy you far less amount of food or other goods.

So yes, if we have WWIII and it lasts close to a decade followed by a rebuilding process, you might have some difficulty recovering...well what's the alternative? I bet most retirement approaches fail in that scenario...

On the positive side getting a job between the mid 30's thru late 60's was pretty easy.

[valhalla360]

Originally Posted by Trimaran Ken

You never know for sure, but if I had 1 mil in my retirement fund and it dropped to 900k with no clear indication it would not go lower, I would make sure I didn't loose any more, or at the very least, lower the risk level of my investments so if things continued to go down, I would loose less.

Much better to loose 10% than 60%.

For many years, I tracked the average risk level of my investments compared to the S&P. I kept mine a little below the S&P.

Ken
===

Unless you can document some fundamental issue where you don't expect a recovery, this is how people lose money in a downturn. They sell low and lock in the losses. People who sat tight in 2008, quickly recovered and enjoyed a long bull market. Those who sold down 20-30% then waited until it had recovered and was up another 50% cost themselves a lot of money and missed out on a big chunk of the bull market.

Of course, if you see a fundamental issue, you should sell regardless of if the market is up or down...trying to time it is a fools game.

There is a fairly simple method to handle market volatility...keep 2-5yrs of expenses outside the market in stable positions. If the market goes down, use this safety money until the market recovers. Most downturns are less than 2yr but if you are worried bump it up by a year or two.

[pt49]

Originally Posted by picklesandjesse

What about those ETN people ???

Not sure what ETN people are... I Googled ETN and came up with this...
Same as borrowing on a credit card and not paying it back I guess.

[Trimaran Ken]

Originally Posted by valhalla360

Markets didn't go down 60%

Markets (in the US) don't go down 60%, but high flying investments do.

FOMO (Fear Of Missing Out) and greed when you see others making giant returns on investment causes stupid people to ignore the risk and jump into things they don't fully understand. Some make large amounts of money, and some loose everything.

Years ago, a friend of mine was into some sort of oil drilling investment. I don't think he really understood all the ins and outs, all he knew was that he was making a lot more than the S&P. Then it all collapsed.

If you don't want to learn enough to be an investment expert, get several conservative mutual funds, and let your money grow slowly.

Ken
===