11/19 Remember the 100-age investment rule we learned in grade school?
For example, if you're 65, you should put at least 100-65=35% of
your savings in stocks. Let's say I'm retiring at 65 today, then
effectively I'd have 1/2 of that much than say, 2004-2005, or
35%/2. I've lost nearly 17.5% of my savings because I retired at
the wrong time. Buy and hold works well when the market is stable
(post 1940 and pre 2008). In the end, do you think the 100-age
rule is still applicable in the turbulent market of the 21st century?
\_ The average return you get is directly related to the amount of
risk you take on. Come back when you've groked that concept. -tom
\_ Hell. My 401(k) balance went from $200k a year ago to $120k today.
YetI still think stocks is the way to go.
Yet I still think stocks is the way to go if you don't need the
money in a short time. I've never heard of that investment rule
since I didn't attend grade school in this country, but I guess its
idea is that you don't need all your money today even if you retire
today.
\_ We are in basically the same boat here.
\_ I think you should be about 75% in equities (25% in bonds)
throughout. I don't plan to change that mix just because I'm
60, although I might cash out to buy some property once I can
do so without any penalties.
\_ No. Even at a relatively young age (under 35), you should be
invested >= 50% into safety (CDs and Treasuries). I think this is
particularly true for those earning the median or less where they
live. For those earning more, you can afford to risk more.
particularly true for those earning the median or less for where
they live. For those earning more, you can afford to risk more.
\_ You are on crack if you put >50% of your retirement into CDs at
age 35. You might not even beat inflation. |
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