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Y'all are crazy if you don't think the stock market is going to take a plunge when NYC is on quarantine from COVID.
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Mar 10, 2020 16:00
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Long-term posters in here aren’t market cheerleaders. It’s just a fact that over 30-year timeframes, equity outperforms other asset classes. This is the long-term investing thread: the correct time to invest money that won’t be used for 30 years is ASAP regardless of current market conditions.
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Mar 10, 2020 16:04
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SlyFrog posted:Yes, but it also brought us back to a price the S&P saw in September 2018, basically. And pretty close to January 2018. If you want money you invested two years ago then that means you've either: 1. run into something really bad and exhausted your emergency savings (rip) 2. invested in the wrong thing if a drop in stock prices affected you Money in the stock market should be either "I don't need it for 20-30 years" or "I want to withdraw when it's up but I'm willing to wait 5-20 years for that happen". So yeah it sucks but it mostly sucks because you (rhetorical) hosed up. SlyFrog posted:It's when you withdraw. It's an additional advantage of retirement accounts, as the idea is that your marginal rate will often be lower when you withdraw than it was when you were making the money. For completeness - there is a penalty on 01k withdrawal (some exceptions apply) when withdrawing before retirement age (60something I don't remember off hand). totalnewbie fucked around with this message at 16:15 on Mar 10, 2020 |
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Mar 10, 2020 16:12
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The penalty can be waived if it's for certain uses. I think the most common one is health expenditures or something? House payments?
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Mar 10, 2020 16:35
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DNK posted:Long-term posters in here aren’t market cheerleaders. It’s just a fact that over 30-year timeframes, equity outperforms other asset classes. My point was that you are being a market cheerleader if you pick a date from a year ago and say, "We're just back to there," as much as you're being overly pessimistic if you pick a date from two years ago and say, "Only 3% gained over two years." My point is don't cherry pick like that. Knock it off.
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Mar 10, 2020 16:36
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Woofer posted:Let me preface this by saying i am not going to be withdrawing from my 401k. Someone in another thread said they would be withdrawing it due to the market crash so that they can pay off credit cards and it got me curious about the taxes involved in withdrawing, so I have a pretty simple question. It basically is counted as income in the year you withdraw, you pay the same taxes you would on any other income. But if you are taking money out early then you pay an extra penalty on top of that also.
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Mar 10, 2020 16:37
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SlyFrog posted:My point was that you are being a market cheerleader if you pick a date from a year ago and say, "We're just back to there," as much as you're being overly pessimistic if you pick a date from two years ago and say, "Only 3% gained over two years." It doesn't matter. This is long term retirement investment discussion. The advice is to keep buying and holding, especially if you are under 50. There are a lot of people coming into the thread and freaking out or making stupid assertions (especially for the goal of the thread). Keep buying, keep holding, keep living, spend to your budget, save more cash if you are worried about your job, etc. The advice will continue to be the same, buy and hold, buy and hold. Time in the market is the key.
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Mar 10, 2020 16:58
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Just so I understand, the “time in the market” adage is due to the interest accrued by positive annual returns being reinvested into your funds, correct? So as long as you are invested during those days with high return, you’ll gain <something goes here> from it and you can reinvest it? Still a little unclear on the mechanics.
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Mar 10, 2020 17:01
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spwrozek posted:It doesn't matter. This is long term retirement investment discussion. The advice is to keep buying and holding, especially if you are under 50. There are a lot of people coming into the thread and freaking out or making stupid assertions (especially for the goal of the thread). Keep buying, keep holding, keep living, spend to your budget, save more cash if you are worried about your job, etc. The advice will continue to be the same, buy and hold, buy and hold. Time in the market is the key. There you have it folks, close thread, replace OP, don’t need 751+ pages of this. Investing is just buy and hold! Don’t think, just buy!
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Mar 10, 2020 17:01
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spwrozek posted:It doesn't matter. This is long term retirement investment discussion. The advice is to keep buying and holding, especially if you are under 50. There are a lot of people coming into the thread and freaking out or making stupid assertions (especially for the goal of the thread). Keep buying, keep holding, keep living, spend to your budget, save more cash if you are worried about your job, etc. The advice will continue to be the same, buy and hold, buy and hold. Time in the market is the key. This is the right way of things, but also important to note: Do Not Look At Your Retirement Accounts Because Of The News. There is zero reason to look at your retirement in a true buy-and-hold strategy, even if one of the companies you're invested in is teetering on bankruptcy. It's not your money, it's retired-version-of-you's money. If you withdraw early, it is an emergency and it's the most expensive cash you can find outside of, like, cash advances or something (probably). jokes fucked around with this message at 17:05 on Mar 10, 2020 |
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Mar 10, 2020 17:02
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spwrozek posted:It doesn't matter. This is long term retirement investment discussion. The advice is to keep buying and holding, especially if you are under 50. There are a lot of people coming into the thread and freaking out or making stupid assertions (especially for the goal of the thread). Keep buying, keep holding, keep living, spend to your budget, save more cash if you are worried about your job, etc. The advice will continue to be the same, buy and hold, buy and hold. Time in the market is the key. So why are we pointing back to where the market was a year ago? Also, is there a thread for people who are holding long term and actually using or withdrawing money? Is that not allowed for discussion? SlyFrog fucked around with this message at 17:08 on Mar 10, 2020 |
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Mar 10, 2020 17:06
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totalnewbie posted:For completeness - there is a penalty on 01k withdrawal (some exceptions apply) when withdrawing before retirement age (60something I don't remember off hand). jokes posted:The penalty can be waived if it's for certain uses. I think the most common one is health expenditures or something? House payments? This is important, and shouldn't be just skimmed over in a discussion of early withdrawals from retirement accounts. It's a 10% penalty on the early withdrawal in addition to being added to taxable income in the year it is withdrawn. There are some exceptions, but they're pretty limited. https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-tax-on-early-distributions
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Mar 10, 2020 17:08
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SlyFrog posted:So why are we pointing back to where the market was a year ago? Because the time scale of investments is 30 years + not 1 year.
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Mar 10, 2020 17:09
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This is what we have to do to ensure that we can retire safely and securely. Don’t like it? Vote for candidates who want to bolster social security, take on financial corruption and wealth inequality, and expand Medicare.
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Mar 10, 2020 17:13
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SlyFrog posted:So why are we pointing back to where the market was a year ago? Because it's context for people who think the sky is falling. It's not cherry picking an arbitrary date - it's providing context for what just happened. Cherry picking data would be "Oh there was a similar x % drop in 1973 and it turned out fine!" or whatever. This is not that. I'll say it again: it only sucks if your investment strategy is not appropriate for your investment timeline. For people in their 20s-40s who are in the market for retirement, it doesn't matter at all; remember: the stock market is not the economy. Pollyanna posted:Just so I understand, the “time in the market” adage is due to the interest accrued by positive annual returns being reinvested into your funds, correct? So as long as you are invested during those days with high return, you’ll gain <something goes here> from it and you can reinvest it? Yes - (some) stocks pay out dividends, which is basically a share of their profits to which you, as a shareholder, are entitled to (get it? shares?), and you use that to reinvest, which means you get a bigger share next time, etc. It's basically the idea of "compound interest" and that every year tacked on to the compounding gets you exponentially (polynomially?) bigger numbers at the end. totalnewbie fucked around with this message at 17:18 on Mar 10, 2020 |
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Mar 10, 2020 17:16
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totalnewbie posted:Because it's context for people who think the sky is falling. It's not cherry picking an arbitrary date - it's providing context for what just happened. So why did I get screamed at for picking a date one year before the date he picked? His date is not an arbitrary date, but mine is? Why is that?
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Mar 10, 2020 17:21
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You're catching flak for being aggressively "this is terrible because I need that money NOW  " not because you picked some earlier dates.
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Mar 10, 2020 17:24
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totalnewbie posted:You're catching flak for being aggressively "this is terrible because I need that money NOW Where exactly did I say that (other than in your head)?
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Mar 10, 2020 17:31
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Anyone starting to get excited about opportunities to tax loss harvest due to the recent drops? (Oh god, I hope this doesn’t seem like market timing  )
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Mar 10, 2020 17:35
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Tax loss harvesting is cool and good, I just did it today
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Mar 10, 2020 17:40
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Deviantfish posted:Anyone starting to get excited about opportunities to tax loss harvest due to the recent drops? (Oh god, I hope this doesn’t seem like market timing I‘m considering converting my trad IRA to Roth. It has a few years of contributions, so I thought this would be a good time to switch it over.
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Mar 10, 2020 17:45
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ranbo das posted:Tax loss harvesting is cool and good, I just did it today Me too!
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Mar 10, 2020 18:03
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SlyFrog posted:Also, is there a thread for people who are holding long term and actually using or withdrawing money? Not really. SA's user base is mostly people in their 20s to 40s. You can start a thread for retirees though. It might be interesting for people who have retired early. The strategies for the distribution phase of retirement are going to be a bit different than the accumulation phase, and conflating the two in the same thread would probably cause some confusion.
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Mar 10, 2020 18:05
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SlyFrog posted:Where exactly did I say that (other than in your head)? SlyFrog posted:I could just as easily say that if I had invested two years ago, I would have made roughly 3% in two years. For all the risks of taking on the market, as opposed to a safe investment, paying off debt, etc. It only sucks if you invested that money two years ago and wanted it now. If you invested it two years ago and want it in 20 years then, again, it doesn't loving matter.
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Mar 10, 2020 18:12
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SlyFrog posted:Where exactly did I say that (other than in your head)? OK, now you're arguing for the sake of arguing. You came in here starting poo poo and nit-picking other people's arguments against market timing in order to try to prove something. Why? What are you trying prove? Because while maybe you're right, in the context of this thread's main purpose, you arguments don't matter.
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Mar 10, 2020 18:13
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pmchem posted:There you have it folks, close thread, replace OP, don’t need 751+ pages of this. Investing is just buy and hold! Don’t think, just buy! If I am retiring in 30 years it is pretty much that simple. Heck buy and hold a target retirement fund and you don't even have to rebalance every year or two. Obviously I am not saying you shouldn't think. The point people are making is buy and hold. How many people didn't listen in 08/09 and then were afraid to get back in? A ton of people. They really lost out (looking at my parents here... Who will retire in 2025).
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Mar 10, 2020 18:13
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Petition to rename thread to emphasize the "long term" part. I think the "investing" part is confusing all the wannabe day-traders. Long-Term Investing & Retirement: Don’t think, just buy!
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Mar 10, 2020 18:15
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There's a stock picking thread already. People can go there
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Mar 10, 2020 18:18
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DaveSauce posted:Petition to rename thread to emphasize the "long term" part. I think the "investing" part is confusing all the wannabe day-traders. Maybe Long-Term Investing & Retirement: Don't talk to it until it's 30 years old.
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Mar 10, 2020 18:18
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Hello thread. Not well versed in this stuff at all, but I'm currently in the process of getting the 401K from my old job rolled over into an IRA. It's been two weeks since I initiated the request, and the 401k has lost a few thousand dollars, I assume due to the COVID market panic. I guess there's not much to do but wait for the transfer to complete processing at this point, but will the money be any more or less "safe" in the IRA vs. the 401k? Would I have lost a significantly different amount of money if I had started the transfer earlier? It's a bit nerve racking watching it plunge like this, but tbf I never bothered paying attention til I had to do this transfer. I've had the 401k for 15 years so I assume such fluctuation isn't unprecedented.
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Mar 10, 2020 18:22
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Xguard86 posted:There's a stock picking thread already. People can go there right, but they don't. I think people come to BFC and see "investing" and think their question belongs here, when in reality they're looking for the stock picking thread. Most lay people seem to consider them one in the same, and that retirement planning involves buying and selling stocks on a regular basis. I dunno maybe in that respect it's a good thing that they come here first and get yelled at, which will lead to more Pollyanna-esque success stories.
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Mar 10, 2020 18:27
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pmchem posted:There you have it folks, close thread, replace OP, don’t need 751+ pages of this. Investing is just buy and hold! Don’t think, just buy! honestly if you don't need the money soon then yes your brain isn't wrinkled enough to give you an advantage
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Mar 10, 2020 18:34
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spwrozek posted:save more cash if you are worried about your job This may be more critical than people realize. We're in a stretch of historically low unemployment, there are no guarantees that continues to be the case. If your office had to get rid of 15% of the people there, would you be on the list?
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Mar 10, 2020 18:35
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Inept posted:Not really. SA's user base is mostly people in their 20s to 40s. You can start a thread for retirees though. It might be interesting for people who have retired early. The strategies for the distribution phase of retirement are going to be a bit different than the accumulation phase, and conflating the two in the same thread would probably cause some confusion. It's a fair point, but I would also argue that any discussion of long term investing for retirement that does not include actual retirement or approach to retirement is kind of silly. Because if it doesn't, the thread might as well just be one post - 100% U.S. equities, because your time horizon is forever before you ever need the money. The purpose of even long term investing is, eventually, to use the money. If the purpose of this thread is simply "Everyone is 20 years old, what do you put your money in," then just throw up 100% equities in a broad market fund in the first post and be done with it. DaveSauce posted:You came in here starting poo poo and nit-picking other people's arguments against market timing in order to try to prove something. Why? What are you trying prove? Because while maybe you're right, in the context of this thread's main purpose, you arguments don't matter. I'm really not. And my argument is actually the argument that advances the thread's main purpose. That is, picking some arbitrary date from a year or two ago, whether it is a soothing or frightening result, is just pointless cherry picking. If you believe in the long term return from the market of 3-4% per year, inflation adjusted, then picking a date one year ago and saying that the market really hasn't fallen that much is silly. As is picking a date two years ago and saying it has only gained 3% over two years. It's all cherry picking. totalnewbie posted:It only sucks if you invested that money two years ago and wanted it now. If you invested it two years ago and want it in 20 years then, again, it doesn't loving matter. Or, you know, if you invested that money two years ago in lieu of paying off debt. In which case you would have a lot more free cash in the upcoming year or two to invest long term. And if you think it "only sucks if you need that money now" (which again, is apparently what is in your head that is replacing what I said), then feel free to give your money to people for 1.5% per year. Because you don't need it now, right? The fact that investment is for the long term does not negate that fact that short term swings do suck, and that capital could have been better deployed, if you had a crystal ball. Which you don't. It also just sucks because no one likes low returns, even for a short period of time. It is a price of being in the market, but it still sucks. Of course, for the long term, the real issue is whether future long term returns will continue to mirror those of the last 100 years or so. I presume we won't have a Nikkei issue, but I'm not as confident as others. The major issue with that, for me, is that I have no idea what else to do even if it does end up that way, so I just continue with my predominantly U.S. equities asset allocation. SlyFrog fucked around with this message at 18:41 on Mar 10, 2020 |
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Mar 10, 2020 18:39
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DaveSauce posted:Petition to rename thread to emphasize the "long term" part. I think the "investing" part is confusing all the wannabe day-traders. I am seconding this petition. Although all the wait vs time the market debates do provide content at least (even if it’s the same statements over and over).
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Mar 10, 2020 18:40
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I don't read the stock picking thread but I think they send people here when posters wander in from the wild.
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Mar 10, 2020 18:43
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All of these are valid points, but the question remains: what are you trying to accomplish by pointing all of this out? It shouldn't change your investment planning, and like you said, nobody here has a crystal ball. Yeah, I could have probably deployed money better, if I could see the future. If I could see the future, I also would have had more cash on hand three years ago when my wife got laid off with no warning, so we wouldn't have had to endure a ton of stress and financial insecurity. But it doesn't matter, because we can't. You can bemoan the current state of the market and how it could have gone differently if only you knew what was coming, but the core fact remains that retirement planning, by definition, isn't a moment-to-moment optimization of your funds based on the state of the market, it's creating a plan and a framework that you stick to regardless of market conditions, specifically to weather market conditions. If you're this upset about the current state of the market, the only thing it means in the context of investing for retirement is that you may need to rethink your risk tolerance for the future. Other than that, all you're doing is nitpicking arguments for the sake of generating more argument, which is actively unhelpful for people seeking actionable information in this thread.
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Mar 10, 2020 18:53
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Best advice I've ever read is "Don't just do something, stand there!!"
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Mar 10, 2020 19:01
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MockingQuantum posted:All of these are valid points, but the question remains: what are you trying to accomplish by pointing all of this out? It shouldn't change your investment planning, and like you said, nobody here has a crystal ball. Yeah, I could have probably deployed money better, if I could see the future. If I could see the future, I also would have had more cash on hand three years ago when my wife got laid off with no warning, so we wouldn't have had to endure a ton of stress and financial insecurity. But it doesn't matter, because we can't. You can bemoan the current state of the market and how it could have gone differently if only you knew what was coming, but the core fact remains that retirement planning, by definition, isn't a moment-to-moment optimization of your funds based on the state of the market, it's creating a plan and a framework that you stick to regardless of market conditions, specifically to weather market conditions. If you're this upset about the current state of the market, the only thing it means in the context of investing for retirement is that you may need to rethink your risk tolerance for the future. It's not nitpicking. Saying, "Look back one year, see, the market is just kind of in the same place," is not really in furtherance of the whole only long term matters thing that people are now frothing about. Because what happens when it drops another 10%, and it isn't in the same place it was a year ago? Or what happens when someone does what I did, and says, "Well, what if I don't look back to this arbitrary date one year ago, but instead look back two years?" The point isn't to say, "Look, a year ago it was about the same." That just furthers the thing we're trying to avoid, which is having people look to short term periods for reassurance. It's not nitpicking to point out that in a thread on long term investing, picking an isolated date from a year ago isn't really productive or toward the goal of the thread. Beyond that, the nitpicking charge is rather silly, given it is one of those things that each side could obviously say. I could just as easily say, "I just made a simple and correct point - it's not good to look a some arbitrary date a year ago when you are talking about investing for the long haul (by giving a counter-example of picking a different point two years earlier), and now you are all needlessly nitpicking and dogpiling against that just to try to score some internet points." The point I made is valid. It's not like it alters the overall point of this thread. It actually is in furtherance of it. It really wasn't a big deal when I posted it, just something I noticed. The easiest way to stop "nitpicking" is to just accept the point (or ignore it) and move on.
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Mar 10, 2020 19:01
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SlyFrog posted:Or, you know, if you invested that money two years ago in lieu of paying off debt. In which case you would have a lot more free cash in the upcoming year or two to invest long term. If someone decided to put money in stocks instead of paying down debt then they either made the decision that they get better long-term returns on their investment than the cost of their debt OR they made the wrong decision. Quite the opposite - if you DO need your money NOW(ish) then you DO give your money to people for 1.5% a year (hello high-yield checking).
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Mar 10, 2020 19:02
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