simplefinance.bsky.social
Airline pilot, single dad, finance and food nerd, writing for simple Personal Finance and Financial Independence. It’s actually very simple. More FILE than FIRE. Not retiring early.
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Agreed. Never put all your eggs in one basket, whether it’s VTSAX or whatever.
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I agree that there are good advisors out there (I’ve used one too). However, IMHO, the majority of sound investment is simply continual, steady investment in passive index funds. Of course, for broader questions and opportunities such as taxes and real estate investing, an advisor can be gold
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Agreed, we should always surround ourselves with smart people. However, PAYING someone to provide advice on how to ACTIVELY manage your finances isn’t smart or necessary. It’s completely sufficient and ultimately more successful to invest in low-fee, passive total stock/bond indexes and walk away
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Exactly. Indexing should most definitely be the foundation of your retirement and portfolio, which is precisely why a typical 401k and 529 is in a perfect diversification of passively-managed stocks and bonds on a glide path
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The stats are clear, and have been for decades: stock picking and active management fail to even meet the market approximately 85-90% of the time.
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www.morningstar.com/funds/active...
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I agree. Motley Fool is total garbage
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www.fool.com/investing/20...
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Agreed. But these guys are unicorns. For the 99% of us, as well as approximately 90% of PROFESSIONAL mutual fund managers, stock picking will fail to meet the market, much less beat it.
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Hallelujah
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No offense, I think you’re awesome, but individual stock picking and prognostication is simply gambling. Buying continuously and steadily well-diversified stock and bond index funds is the proven success strategy
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I agree. It’s savings, and shouldn’t be subject to the whims of the stock market.
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Why on earth not?!? You would rather have your emergency fund in a bank account doing nothing, earning nothing, losing buying power due to inflation? I keep my emergency fund in my Vanguard money market and can access it in 24 hours by transferring it to my bank.
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“Definitely don’t invest it”, I would slightly push back on: the emergency fund should be put into a money market account, which is currently earning about 5%, half of the historical average of the stock market. So I would say that it should be “earning” something
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Where?
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Good point, however my point is that if you invest in well-diversified index funds, it doesn’t really matter which one it is. The market goes up, and all boats collectively rise
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Only those who don’t know what they’re doing sell when stocks crash. If everything went on sale at Target tomorrow at a 20% discount, what would people do? Run to, and spend money at Target. What do they do with their stock? Sell. In 2008/2009, everything was on sale.
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It’s just ice crystals in a Cirrus cloud
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Brokerage account
📈Pay tax on any gains (not on contributions)
📈Invest after funding retirement and emergency fund
📈Easily open account at Schwab, Fidelity, etc.
📈Can request a debit card for access to cash
📈No investment limits (contribute as much/little as you like)
#investments #money