Ah, Grasshopper. You can not attack me. You also do not understand me AT ALL. Let me help you out a little bit.
1) I NEVER brag about how I am doing in a given year against the market or just how I am doing in a given year in general. Why would I just admit I am losing to the Dow now YTD if I wanted to brag? That's surely not a brag. I am a facts-based person, and I just spew facts. When I am losing big time to the Dow or just having a bad year in general, I will tell you that also. I do not brag. I just state facts. I realize that is hard to understand for most people who DO like to brag, but I do not have that need and I NEVER do it. If you ever think I am bragging, you are just mistaken.
2) I have never said that it wouldn't be a good idea to just buy broad market funds. I think that is a very solid choice. In fact, I have advised my kids to do just that if they want a complete hands off approach.
3) I started investing in 1989. The internet was not as we know it today, so advice was hard to come by. I worked for two companies in my early years that matched with their own company stock, so I did that...free money, and while not what I wanted, it was better than nothing, and they both actually turned out well. I also just bought some randomly-picked mutual funds initially, because that was kind of the advice of the day -- throw a dart. I did that.
4) My wife and I invested half of our income the first 7 years of our marriage (I was 23), and I have kept it at a very high level since. I wanted some diversification (which I had learned by then that that was a good idea), so I constantly added new funds.
5) When the Dow hit 22,000, in 2017, I reached my lifelong milestone total I knew set me up for life. I could have retired then, but I was only 51 years old and not quite ready to do that...so I worked for 5 more years and retired at age 56. I owned my own company, so I slowly got rid of work by not looking for new clients. When I was done with a project for some of my clients, either they would not have anything for me, or I would tell them I was going to retire soon and they should look elsewhere. The last two years of working, I was working just 10-15 hour per week (though still making a typical full time salary). My wife is a college professor and wants to work for 3-4 more years. She took 15 years off from working to be home with kids, so she hasn't quite hit the point where she wants to retire just yet. So, we have continued to heavily invest even after the Dow hit 22,000 in 2017.
6) At this point (2017), my fund picks (and the company stock I had early on) had beaten the Dow and the S&P 500 by a little bit on average since 1989, so I decided to just keep things where they were. I am SOOOO diversified now that it is almost as if I just bought broad market funds.
7) I have no need or interest in switching things up now. I have way more money than I will ever need, and I have NEVER let greed affect my investment choices. Greed is where many investors go wrong...buying and selling, trying to pick a great random single stock, staying out of the market until they think it is JUST the right time, etc. Greed is a sin, and while I'm not religious, that is still good advice there...greed is not good and has stifled many financially, including some who post here.
8) So, your 23-year-old self could have given my 23-year-old self some valuable advice, but brother, I am 58 years old and have been investing since 1989, and nothing you say is news to me. The amount of money my funds have brought me in 2024 is FILTHY. It's more in this one year than most people retire with. I don't need any advice from you. I really don't. Just stating the facts.
I know a number of rich people and none of them, NONE of them, will continually talk about how rich they are. For some reason Flagpole is the only "rich" person I know who is so insecure that he feels the need to continually talk about how "rich" he is. For someone so "rich" he really doesn't seem to understand some basic fundamentals of investing. This beating the Dow 34 out of 36 years is hilarious. If he knew anything about probabilities, he would know how far-fetched this is. But they don't teach you about statistics or investing in journalism school.
I am unlike anyone you know. I don't brag. I just state facts. I, of course, don't talk about personal wealth in person with people I know (well, except for one buddy of mine because we talk finances and net worth all the time...he and I were in an "investing club" together decades ago.). Here on an anonymous message board in a thread about the stock market though? Yeah, I will, because you mooks keep making the same mistake that most people do, and you will never have what I have even though I didn't spend time pouring over charts and tables and taking gambles on individual stocks or putting all of my money in one index, etc.
And again, you got the years wrong, but you also have ZERO idea how to calculate the probability...absolutely zero.
8) So, your 23-year-old self could have given my 23-year-old self some valuable advice, but brother, I am 58 years old and have been investing since 1989, and nothing you say is news to me. The amount of money my funds have brought me in 2024 is FILTHY. It's more in this one year than most people retire with. I don't need any advice from you. I really don't. Just stating the facts.
I am also confident I will have far more money than you do at present when I am your age.
Oh yeah? Care to tell me what you think that will be? Have to adjust for inflation too, of course. What do you think my net worth is today? What do you think yours will be when you are 58 in today's dollars?
I have set you up either to lie OR to fall far short of what I have, but you go ahead and let me know, Grasshopper.
Well, that's to your detriment, and of course I KNOW you read it anyway, because you picked the things that clearly explained to you my investing history and how I got there and even that I agree with you about choosing a broad market fund if I were to start today. You just want to wave your little d!ck around.
Dude, I don't invest to compete with others. I have always invested to make for myself what I want in retirement...initially the goal was to retire at age 67, but then as my investment pile grew, that age dropped to 65 then 62 then 59.5 and then finally 56, and like I said, I could have retired at age 51 with what I wanted and needed, but I wasn't ready to retire just yet.
There is nothing you have said about investing that I don't already know.
I am also confident I will have far more money than you do at present when I am your age.
Oh yeah? Care to tell me what you think that will be? Have to adjust for inflation too, of course. What do you think my net worth is today? What do you think yours will be when you are 58 in today's dollars?
I have set you up either to lie OR to fall far short of what I have, but you go ahead and let me know, Grasshopper.
Also, what percentage of your income do you invest each year? Are you married? Did you invest HALF of your income, including wife's income, from age 23 for 7 years? If not, you've got a big bunch of ground to make up.
So, what, in today's dollars do you think you will have when you turn 58? Know that lying is a sin.
I don't really care to get into a spat with you, but it is VERY CLEAR from reading your posts you do not understand investing well, even if you have ended up with a good amount of money to retire with.
BS. There isn't anything you understand about investing that I do not.
Right. There is not a single thing in my brain regarding investing that is not in your brain. A very reasonable thing to say.
Also, nice job hopping on your 3 different devices and upvoting all your posts. FP, though you probably can't really appreciate what I'm about to say, such behavior is FAR outside the norm and indicative of personality issues that are very likely clinically significant.
Good job investing consistently for 35 years though. You've without question done better than most.
I am also confident I will have far more money than you do at present when I am your age.
Oh yeah? Care to tell me what you think that will be? Have to adjust for inflation too, of course. What do you think my net worth is today? What do you think yours will be when you are 58 in today's dollars?
I have set you up either to lie OR to fall far short of what I have, but you go ahead and let me know, Grasshopper.
In today's dollars I will be making between $500,000 and $1 million per year passively from my investments alone by the time I am 58. I give a large range because it's a ways off for me, but consider that a 95% confidence interval.
The company matches from the two companies that employed you in the early years of your career - can you tell us what they were or failing that, at least what sector/industry? The reason i ask is you want us to use your strategy as an example, but frankly, few have the advantage of your stock options/matching from a company.
So to put that into perspective, understanding that component of your portfolio would be informative.
TIA.
Well, since most people won't have the "advantage" of getting company stock as the match (I say that's a disadvantage...it just happened to work out in my favor), I'm not sure how me telling you more would help. I WILL tell you this...one was a conglomerate, and one was a software company.
And, regarding MY strategy...I wouldn't call it a strategy as much as it is just what people SHOULD do. Get out of debt as soon as possible and then stay that way. Put 15% or more (I've averaged way more) into diversified mutual funds that contain STOCKS. If you want them to be index funds, that's fine. Don't buy individual stocks unless you already have $1 million or more in mutual funds and you have no debt including a paid-for house. So, what buying individual stocks really amounts to is entertainment. I have no need for that entertainment, so I do not own individual stocks even though I met the criteria to do so long ago. You should not do it if you NEED the proceeds from those individual stocks to fund your retirement. They should be ONLY purchased with money you can afford to lose. Some of that advice is borrowed from Dave Ramsey, even though I disagree with him on a lot of things and he's a POS person, and some from Jim Cramer, who I also don't agree with 100%.
In addition though...you do whatever you want to do regarding your investing. I don't care what you do, so I don't WANT you to do what I have done. It just would have behooved you if you had...my individual stock matching aside.
I have said this many times, but I will do so again...I am NOT an investing wizard. I just DO invest...heavily and without stopping since 1989. The REASON my wife and I invested so much early on is that we lived in the SF Bay Area when we got married, and we did not think we could EVER buy a house there, so instead of saving up for a house, we decided to invest for our retirement, fully intending to move away from the Bay Area when our graduate schooling was over. So, even that heavy investing early on was not due to some great foresight of mine. I DO give myself credit for DOING the investing and not just spending it all, but I had no idea my investments would bring me to the place I am now...certainly not then did I think that. I was just investing money to have when I retired and no longer had an income.
I have been fortunate both with investing choices and the stock matching thing and with the circumstance initially that led me to investing so much early on, BUT even with that good fortune, I DID decide to invest and invest a LOT, so I DO take credit for that.
That is exactly as I suspected regarding the stock matching you received, and I had a hunch it was a Software company, too.
This area I live in is loaded with people who received Stock Based Compensation (SBC) and stock options from companies like Microsoft much like you did and became millionaires simply from that. Of course, maybe it was IBM or Intel or another co., but they were all very lucrative at the time. And some conglomerates like GE did astoundingly well also.
Those who were lucky enough to have been there consider themselves to have been fortunate to be at the right place at the right time, becuase few foresaw the windfall that would enrich them. And fwiw, it was generally understood that those who had landed that SBC and/or stock options were set for life and that was about all they would ever need regardless of their subsequent investing.
That story pervades the industry in this area and the hopes of replicating it in start-ups or particularly successful companies is quite common.
I know a number of rich people and none of them, NONE of them, will continually talk about how rich they are. For some reason Flagpole is the only "rich" person I know who is so insecure that he feels the need to continually talk about how "rich" he is. For someone so "rich" he really doesn't seem to understand some basic fundamentals of investing. This beating the Dow 34 out of 36 years is hilarious. If he knew anything about probabilities, he would know how far-fetched this is. But they don't teach you about statistics or investing in journalism school.
I am unlike anyone you know. I don't brag. I just state facts. I, of course, don't talk about personal wealth in person with people I know (well, except for one buddy of mine because we talk finances and net worth all the time...he and I were in an "investing club" together decades ago.). Here on an anonymous message board in a thread about the stock market though? Yeah, I will, because you mooks keep making the same mistake that most people do, and you will never have what I have even though I didn't spend time pouring over charts and tables and taking gambles on individual stocks or putting all of my money in one index, etc.
And again, you got the years wrong, but you also have ZERO idea how to calculate the probability...absolutely zero.
When you are calculating the return of the Dow Jones each year you are only using only the price index. You are failing to include the large effect of reinvested dividends. How would you be able to calculate to total return of the Dow? For each year and for each stock, are you looking at each quarter the number of common shares owned by investors and the number of preferred shares owned by investors? Not always are dividends paid on common shares. Sometimes investors get additional shares. And you are looking at the dividend yield for each stock of the Dow?
Ok good well flagpole’s performance numbers sound like it’s his whole portfolio. If that’s true he’s had very high returns. Albeit with a lot of risk. at his age he shouldn’t have an all-stock portfolio but it sound like he does.
good for him that it’s worked.
I answered this in another post, but I'll do it again for those who don't like to read (which is most of the people here).
1) My INVESTMENTS today are ALL in stock-containing mutual funds. I have no bonds. I have nothing else that would be considered an investment, so 100% stocks.
2) I have ZERO debt including a paid for house. Technically, we could sell the house, buy one for maybe $150k cheaper somewhere and live on that and SS if we had to.
3) I have now about 4 YEARS of expenses saved liquid. 3 YEARS was the goal by the time I retired, and I had that then, but as my wife still works, and we don't need all of her salary to live on even though we still invest a lot of what she makes, the liquid reserves have grown. I decided long ago to forgo bonds and instead make sure to have easy to get money outside of stocks when in retirement.
4) While I submit my strategy there is very good (because stocks over time will kill bonds over time), my investments have grown to a size where the cash reserves are no longer needed. I could easily still take what I need and want out of my mutual funds even if the market did another huge plunge like it did in 2008.
So, I have cash instead of bonds. Even the cash is earning some in two different savings accounts, but it's not there to earn money. It's there to use IF I need to in case of a big stock market crash...but again, I am no longer in the position to need that cash for that purpose.
ok cash is 75% the same as bonds so no big deal
I suppose a major difference to this discussion is that if you had bonds, their performance would be part of the performance numbers you report.
But since you have cash, you are onkly reporting performance of your stock portfolio, not your entire portfolio.
So that's keeping your performance higher than it is, if it included cash in it.
in other words:
My 'stock only' performance for the last 12 months is +/- 31% but if I include my bonds, it's much lower. Should I report my 'stock only' performance like you do?
You aren't including your cash in your performance numbers which makes your performance look better than it would be if you included your cash return.
This post was edited 13 minutes after it was posted.
Seriously...that is atrocious. People pay for this advice.
Seth Golden @SethCL JPM's Dubravko & Kolanovic "Equities are now richly valued...We expect lackluster global earnings growth w/downside for equities from current levels. For $SPX we estimate earnings growth of 2-3% next year w/EPS of $225 and Price Target of 4,200...downside bias
Maybe this is an opportunity to say something that I've felt prone to say many times in our discussions, and that is simply how thankful I am that I was given all the opportunities, advantages, and breaks that were afforded me, my family, and our community. It is apparent to me that not everyone can say the same, and I am not going to take these for granted. I think it is important to keep this in mind when we proclaim achievements in discussions like these involving wealth and the accumulation of it.
Oh yeah? Care to tell me what you think that will be? Have to adjust for inflation too, of course. What do you think my net worth is today? What do you think yours will be when you are 58 in today's dollars?
I have set you up either to lie OR to fall far short of what I have, but you go ahead and let me know, Grasshopper.
In today's dollars I will be making between $500,000 and $1 million per year passively from my investments alone by the time I am 58. I give a large range because it's a ways off for me, but consider that a 95% confidence interval.
So, you don't want to answer my questions. Got it. And, if for some reason you THINK you answered ANY of my questions, then that just shows how comprehension is not strong with you.
Without giving details though, with what you said there, you fall behind me at age 58 based on what I've made this year. So, you fail. This isn't even anything I care about, but YOU brought up how great your investment strategy is, how you have a strategy to beat the market every year (hear that, Sally?), and how you will have much more than me when you are my age.
Let's also lay out the difference between you and me. When others here talk about how much they've made in this calendar year or any year, I congratulate them, even if how they did it isn't the way I would do it. You, on the other hand, decided that what I've made this year deserves ridicule and how much better you are at investing. You have shown your cards now, and you will NOT have what I have at age 58, so you lose.
Gonna have to be done with you as you are just a young Grasshopper who can't even lie enough to be doing better than me at age 58, and you're a bit of an a-hole, and you KNOW is true. You don't have to be an a-hole. Change. You enjoy your life, and I hope you grow up a bit.
I am unlike anyone you know. I don't brag. I just state facts. I, of course, don't talk about personal wealth in person with people I know (well, except for one buddy of mine because we talk finances and net worth all the time...he and I were in an "investing club" together decades ago.). Here on an anonymous message board in a thread about the stock market though? Yeah, I will, because you mooks keep making the same mistake that most people do, and you will never have what I have even though I didn't spend time pouring over charts and tables and taking gambles on individual stocks or putting all of my money in one index, etc.
And again, you got the years wrong, but you also have ZERO idea how to calculate the probability...absolutely zero.
When you are calculating the return of the Dow Jones each year you are only using only the price index. You are failing to include the large effect of reinvested dividends. How would you be able to calculate to total return of the Dow? For each year and for each stock, are you looking at each quarter the number of common shares owned by investors and the number of preferred shares owned by investors? Not always are dividends paid on common shares. Sometimes investors get additional shares. And you are looking at the dividend yield for each stock of the Dow?
I am not FAILING to do anything. I can decide how to compare my returns against the Dow in any way I like. I could have picked comparing my annual results to sales of Tomato Bisque soup if I wanted to. SOOOO weird that you have such an issue with this. Really, it's weird.
I answered this in another post, but I'll do it again for those who don't like to read (which is most of the people here).
1) My INVESTMENTS today are ALL in stock-containing mutual funds. I have no bonds. I have nothing else that would be considered an investment, so 100% stocks.
2) I have ZERO debt including a paid for house. Technically, we could sell the house, buy one for maybe $150k cheaper somewhere and live on that and SS if we had to.
3) I have now about 4 YEARS of expenses saved liquid. 3 YEARS was the goal by the time I retired, and I had that then, but as my wife still works, and we don't need all of her salary to live on even though we still invest a lot of what she makes, the liquid reserves have grown. I decided long ago to forgo bonds and instead make sure to have easy to get money outside of stocks when in retirement.
4) While I submit my strategy there is very good (because stocks over time will kill bonds over time), my investments have grown to a size where the cash reserves are no longer needed. I could easily still take what I need and want out of my mutual funds even if the market did another huge plunge like it did in 2008.
So, I have cash instead of bonds. Even the cash is earning some in two different savings accounts, but it's not there to earn money. It's there to use IF I need to in case of a big stock market crash...but again, I am no longer in the position to need that cash for that purpose.
ok cash is 75% the same as bonds so no big deal
I suppose a major difference to this discussion is that if you had bonds, their performance would be part of the performance numbers you report.
But since you have cash, you are onkly reporting performance of your stock portfolio, not your entire portfolio.
So that's keeping your performance higher than it is, if it included cash in it.
in other words:
My 'stock only' performance for the last 12 months is +/- 31% but if I include my bonds, it's much lower. Should I report my 'stock only' performance like you do?
You aren't including your cash in your performance numbers which makes your performance look better than it would be if you included your cash return.
^^ This summarizes how to calculate portfolio performance, imo.
I believe one needs to include Bond component in the calculation, and I say that because it is part of your investment portfolio, and as such, in a bad year for the market, the bonds may actually temper the negative impacts, and thereby contribute possibly to the strength of a portfolio.
Cash component should only be included if it is held in the investment account, not in a savings account for example. If one has a few months of living expenses residing in their savings account, that would not be included, but if someone was holding a cash position in the brokerage account for any reason, by all means that should be included. And again, the cash in a brokerage or retirement account may actually be a good thing in a down year for the marets, and that should be recognized and captured in the calculations.
That's how I see it, and when comparing one's portfolio to an index, it is essential to do so consistent with how the index is being calculated (with or excluding dividends, for example). This should be assumed, frankly.
I answered this in another post, but I'll do it again for those who don't like to read (which is most of the people here).
1) My INVESTMENTS today are ALL in stock-containing mutual funds. I have no bonds. I have nothing else that would be considered an investment, so 100% stocks.
2) I have ZERO debt including a paid for house. Technically, we could sell the house, buy one for maybe $150k cheaper somewhere and live on that and SS if we had to.
3) I have now about 4 YEARS of expenses saved liquid. 3 YEARS was the goal by the time I retired, and I had that then, but as my wife still works, and we don't need all of her salary to live on even though we still invest a lot of what she makes, the liquid reserves have grown. I decided long ago to forgo bonds and instead make sure to have easy to get money outside of stocks when in retirement.
4) While I submit my strategy there is very good (because stocks over time will kill bonds over time), my investments have grown to a size where the cash reserves are no longer needed. I could easily still take what I need and want out of my mutual funds even if the market did another huge plunge like it did in 2008.
So, I have cash instead of bonds. Even the cash is earning some in two different savings accounts, but it's not there to earn money. It's there to use IF I need to in case of a big stock market crash...but again, I am no longer in the position to need that cash for that purpose.
ok cash is 75% the same as bonds so no big deal
I suppose a major difference to this discussion is that if you had bonds, their performance would be part of the performance numbers you report.
But since you have cash, you are onkly reporting performance of your stock portfolio, not your entire portfolio.
So that's keeping your performance higher than it is, if it included cash in it.
in other words:
My 'stock only' performance for the last 12 months is +/- 31% but if I include my bonds, it's much lower. Should I report my 'stock only' performance like you do?
You aren't including your cash in your performance numbers which makes your performance look better than it would be if you included your cash return.
Yes, I only report my INVESTMENTS. Cash is not an investment, so I don't consider it part of my "portfolio." I don't count the value of my house or my three cars or my musical equipment or my coin collection or my wife's stamp collection or anything else I/we own as part of my "portfolio." I don't even think in terms of a "portfolio." I have investments, and I have things that aren't investments. I track the progress of my investments only. Even with 4 YEARS of expenses in cash, that PALES in comparison to what I have in stocks, so it is next to immaterial.
You can report your returns in any way that you like. I couldn't care less. Doesn't affect my life one bit. Bonds though ARE an investment vehicle, and cash, even if in a HYSA is not. So, I would say you are being disingenious if you don't include bonds in your annual returns, but again, I don't care what you do.
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