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Post by DigDug on Aug 30, 2015 21:08:44 GMT -6
Over the past 20 years I've listened to a couple of advisers. At three different periods over those 20 years I've invested 10k. Each time I've lost over 2/3 of the invested amount.
In the late 90's I was told to put it in a Tech Fund (lost 8k of the 10 I put in). After that I was told to put it in a International fund (lost 5k). After I was told to put it in an Target fund (in 9 years I'm still down 2k).
Now I'm told to put my money in a "safe" Income Fund (but I'm getting hammered with 5% fees!!!)
Why the Hell is this so hard?!? I've done Great with houses. All I want/need is a safe way to put some money away each week/month (nothing big) and get 3-5% after fees. Is that really so hard?.
i guess what I'm asking is where can I get solid advice for what seems like a Simple problem.?
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Post by Old26 on Aug 30, 2015 21:32:10 GMT -6
The simple fact is that the market is a rigged joke.
Bankers and Wall St make sure you only get what they want you to get. Honestly, real estate is probably the best way to go. Even commodities like gold and silver are likewise manipulated. My old man had literally a couple hundred pounds of silver in the 80's that went to shit after the Hunt bros destroyed that.
It's a fine line between saving and living a good life - enjoying the moment. I tend to not want to have too much in the 401k as I saw many friends ~2009 lose 40% of their 401k. That was a shitload of money.
Don't have much advice for you other than look for good companies and invest in them. Apple got us a lot here. Started at $27 a share and we bought and sold for about 15 years, taking the larger sums to work on and improve the house as get autos, etc.
I'm done with it sans my current 401k. Still trying to decide what to do myself.
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Post by david2403 on Aug 30, 2015 22:14:46 GMT -6
Over the past 20 years I've listened to a couple of advisers. At three different periods over those 20 years I've invested 10k. Each time I've lost over 2/3 of the invested amount. In the late 90's I was told to put it in a Tech Fund (lost 8k of the 10 I put in). After that I was told to put it in a International fund (lost 5k). After I was told to put it in an Target fund (in 9 years I'm still down 2k). Now I'm told to put my money in a "safe" Income Fund (but I'm getting hammered with 5% fees!!!) Why the Hell is this so hard?!? I've done Great with houses. All I want/need is a safe way to put some money away each week/month (nothing big) and get 3-5% after fees. Is that really so hard?. i guess what I'm asking is where can I get solid advice for what seems like a Simple problem.? Unfortunately, in this market earning 3 - 5% without an uncomfortable amount of risk is almost impossible. The 30 year bond is hovering around 3%. If I knew the answer I would do it myself. A lot depends on your age, the amount of risk you are comfortable with and the amount of money you have to gamble. If you have been successful with real estate that might be the direction you want to take. |
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Post by wisdom on Aug 31, 2015 1:56:43 GMT -6
Over the past 20 years I've listened to a couple of advisers. At three different periods over those 20 years I've invested 10k. Each time I've lost over 2/3 of the invested amount. In the late 90's I was told to put it in a Tech Fund (lost 8k of the 10 I put in). After that I was told to put it in a International fund (lost 5k). After I was told to put it in an Target fund (in 9 years I'm still down 2k). Now I'm told to put my money in a "safe" Income Fund (but I'm getting hammered with 5% fees!!!) Why the Hell is this so hard?!? I've done Great with houses. All I want/need is a safe way to put some money away each week/month (nothing big) and get 3-5% after fees. Is that really so hard?. i guess what I'm asking is where can I get solid advice for what seems like a Simple problem.? You seem to do alright with real estate, it seems. In this market, you can get yields of 8% or more pretty easily. For example, you can plop down $120k or so on a townhome in certain markets that you could turn around and rent out for $1.2k / month or so. After deducting HOA fees, management fees, taxes, insurance, and setting aside a reserve for maintenance items, you could come away with at least an 8% return. Add the capital gains you may get from the property itself and you have a pretty solid investment. Some markets have a better price:rental ratio and some do not.. 8% I'd say isn't too hard to find, though. ..are you looking for 3-5% each month? That would put you on par with private equities. If you know how to trade some more complicated derivatives, you can make some good money buying stock and selling options against them in this market, given the high volatility.. if you don't understand what I'm talking about, it's best not to even google it as you could lose a ton if you don't know what you're doing. Old26 is right about the market, though.. you're trading against guys with so many unfair advantages, many with strategies to do nothing but bilk guys like us. |
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Post by DigDug on Aug 31, 2015 4:56:45 GMT -6
wisdom thats what I've been doing (flip a couple houses and then buy and hold one as a rental). Doing this has made me Equity Rich but Cssh Poor. I'm just looking to save a small amount each week (dollar cost average). But can't find a simple low fee way to do it. I'm now looking at some of the Vanguard Funds.
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Post by brentkuz on Aug 31, 2015 5:00:23 GMT -6
Keep investing in houses if that is what works for you.
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Post by seth on Aug 31, 2015 5:54:55 GMT -6
wisdom thats what I've been doing (flip a couple houses and then buy and hold one as a rental). Doing this has made me Equity Rich but Cssh Poor. I'm just looking to save a small amount each week (dollar cost average). But can't find a simple low fee way to do it. I'm now looking at some of the Vanguard Funds. Vanguard is exactly the way to do it. Just come up with an allocation model that works for you. If you can't figure out a model, go with a target fund because the model is built in (i.e. the target fund is a diversified fund of funds) |
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Post by seth on Aug 31, 2015 5:56:00 GMT -6
DigDug It sounds like you were advised to go into sector funds at the top of the market. You were not diversified and bought at the peak - i.e. Tech in the 90's and International before the global recession. I'm not sure why any advisor would recommend sector specific positions for someone who didn't have a diversified set of core holdings. Sounds like bad advice that sounded sexy at the time. Sorry. That sucks. Who is charging you 5% fees? Are you buying front loaded funds that charge a 5% fee plus an annual expense ratio? That's terrible. Switch to a company that doesn't charge any fees. The best in the industry is Vanguard. No fees and super low expense ratios (often 0.10%). Many brokerages (TDA etc) don't charge a transaction fee to trade vanguard ETFs. And of course you can create an account directly at Vanguard. 3 - 5% / year after fees is perfectly reasonable. Over the decades the S&P returns about 9.6 % / average (from 1928 - 2014)*. That's before fees and taxes. You could buy a simple Vangard index and hold it forever and meet your goals. But you might look at the ups and downs per year. It's possible you cannot stand the volitility during down years. Remember Japan had two decades of flat to no growth (the lost decades). Yes, there are aspects of the markets that are rigged and manipulated (silver - the Hunt brothers in the 80's is the perfect example, oil, most commodities, interest rates, currency valuations, etc). But there's still plenty of room for a retail investor to do fine. That said, if real estate works for you, stick with it. wisdom's example of 120k purchase price and $1200/mo rent illustrates the 1% rule. If the monthly rent generates 1% of the total purchase price, it's probably a good investment for cash flow. That kind of property is difficult to find in large cities, but easy to find once you get out of major metro areas. * www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp
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