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Investing total Income for Max Growth

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Money Talk > Investing, Stocks and Bonds

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oldguy
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Such as when i told my ex wife to pull out her stock investment in 2007 and put it into gold. She didn't and lost 60k in 2008.


Not quite. Today's market is way higher than the 2007 high - she would have doubled her money just by leaving her money invested and enjoying today's Dow22,000.

As for gold - it was at about $1000 when Reagan was elected in 1980 - and it's still around $1000 today. Meanwhile the Dow30 went from 1000 to 22,000 in that same 35 year time frame.

The wealthiest people from the past 40 or 50 years "incrementally accumulated", never sold or traded. It takes patience and discipline, most people can't/don't do it - and the percentage of millionaires is fairly low because of it.
Post Wed Aug 09, 2017 8:53 pm
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Mad_Scientist
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True, but if we would of pulled that money out. waited for it to bottom, and then reinvested we could of done much better. We ended up living with the loss because we were already about done with closing on our home and we used that investment for the down payment. it was a disaster in my mind. I def wont be done that mess again.
Post Thu Aug 10, 2017 2:43 pm
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oldguy
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True, but if we would of pulled that money out. waited for it to bottom, and then reinvested we could of done much better. We ended up living with the loss because we were already about done with closing on our home and we used that investment for the down payment. it was a disaster in my mind.


I almost burst out laughing at that - and it certainly explains why only about 4% of Americans are millionaires. We are the wealthiest nation on the planet, US average earner makes >$52k, millions of middle-class workers are earning >6-figures Yet, much of an entire segment of the population (Boomers) are closing in on retirement with only a couple hundred thousand dollars to their name.

Literally, dozens of books and articles have been written about your "pull out, wait for the bottom, get back in" theory. One statement that you often hear "I'm waiting for the market to recover so that I can get back in" - think about that, lol (it is called "buy high").
Post Thu Aug 10, 2017 4:19 pm
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Mad_Scientist
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So if, then when, did you start moving over to "safer" vehicles? (Bonds, gold, etc)
Post Sat Aug 12, 2017 5:02 am
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oldguy
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In general, humans are given about 30 years for "wealth-building" and hopefully another 20 or 30 years of "wealth preservation".

The Law of investing - risk and return are directly proportional. During your wealth-building years, you need to take risk - then you transition to wealth preservation (low risk) at about age 60.

I adjust my risk by changing my top-down "stock-bond" ratio. Eg, for most on my working years I was at 100% stocks/0% bonds. At about age 65 I moved to 90%/10%. And then to 80%/20%, and so on.
But I did that based on my age, not on how the market was doing. And I keep my stock/bond categories 'pure' - eg, if I wanted to add risk, I would not switch from a 4% blue-chip bond to a 9% high yield (junk bond) bond, instead I would change my top-down number from 80/20 to 90/10.

Today the market is at about Dow22,000. In 10 years it will be about Dow50,000. It might see 15,000 next week - or it might see 70,000 on its way to 50,000. It doesn't matter, I focus only on the 50,000 in 2027.

Same with real estate - whenever I wanted to increase my risk level, I would refi a house, take out the equity, and buy 11% stocks with the money.

You mention gold - I don't really put that in a 'safe' category, gold is mostly a play on currency. Eg, in the 1970s when Mexico devalued the peso by 2, it appeared to a Mexican citizen that gold doubled. Same in the US, when the value of the US Dollar falls, it appears to us that the price of gold increases. In both cases, the intrinsic value of the gold didn't change.

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Post Sat Aug 12, 2017 2:30 pm
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Certvalue
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Investing money Very importants  Reply with quote  

Now a days money very important. Look in to around world they are 700 crores of peoples are living in the earth with different cast, religions but all are depends on unique thing that is money. The money having rides to do any thing in the world. So money is more importance in our life. So saves money is the good procedure.

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Post Tue Aug 15, 2017 10:07 am
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Rupertx
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i think inventing total income is totally flop idea to get max growth... don't be greedy.
Post Wed Aug 23, 2017 1:07 pm
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