The wealth-building thread

[Doodski]

That risk is up you because the stock market could crash at any moment and you'd die penniless, while CDs and a couple other options are up to the banks to take the risk of.

IC. How long to get a ripe and cashable secure and safe investment? I worked as a sales specialist, a electronic tech as well as an assembler in heavy equipment vehicle manufacturing and I know nothing about investments. I have CPP and OAP as well as some other stuff but that was easy stuff to invest in. Little to no risk.

 

[JeffS7444]

Everything that I know about commodities comes from an old movie starring Eddie Murphy and Dan Akroyd.

The continued survival of crypto is a wonder to me, but (shrug) believers gonna believe.

 

[Tom C]

Everything that I know about commodities comes from an old movie starring Eddie Murphy and Dan Akroyd.

The continued survival of crypto is a wonder to me, but (shrug) believers gonna believe.

A personal favorite.

 

[JeffS7444]

IC. How long to get a ripe and cashable secure and safe investment? I worked as a sales specialist, a electronic tech as well as an assembler in heavy equipment vehicle manufacturing and I know nothing about investments. I have CPP and OAP as well as some other stuff but that was easy stuff to invest in. Little to no risk.

Sounds to me like you're right where you need to be. Canadian Treasury Bills don't look too shabby either:
https://www.bankofcanada.ca/rates/interest-rates/t-bill-yields/
You could consider staggering the purchases so that at any given time, you'll have one approaching maturity.

Having experienced the Y2K and 2008 market downturns, I am probably more accustomed to dealing with volatility and not panicking when I see thousands of dollars of value seemingly vanish. In fact, last week's stock market downturn did a number on me, and who knows when it will end. At such times, I stop checking my account balances.

 

[Doodski]

and 2008 market downturns

Canada did an Amazing Kreskin act and I avoided any issue with the 2008 downturn. We where humming along with lotsa business going on. I sailed through it easily thankfully. Hmmz... I don't really have exposure to or worry when such stock market ups and downs occur because all of that worry is taken care of for me by the peeps that know their investment stuff. I simply await my direct deposits and I cash in that way. It's pretty nice and I am told it will get better in a few years too.

 

[007Shorty]

Entertaining and above all informative:

 

[Pareto Pragmatic]

To really build wealth, think in terms of multi-generational wealth building. To build wealth as an individual, invest consistently and look for low fees. If you do that with 10% of every check you earn in your life, off the top, you will build a good nest egg. If you start doing that at 30, not so much.

I did do some trading back in the day, but found it way too much work for the extra return. And my brother, he's doing all sorts of things with options these days, which is tempting given his returns. But after a bit, I decided to go with this.

I go with index funds (low cost), spread across different asset classes. Every check for decades, so dollar cost averaging. I re-allocate by asset classes once a year. I am just starting to shift to a more conservative stance from my "80% equity" position as I approach retirement and beyond.

So, overall US market, international market, REITs, bonds, etc.

That's it. It's not complicated, but it is effective.

 

[blueone]

Looking at the equity markets today, my advice is:

Stow your tray tables. Put your seat back in the upright and locked position. Put away your laptop computer, and make sure your carry-ons are under the seat in front of you, or in an overhead bin. Make sure your seatbelt is low across your hips and tight.

Oh yeah... it's usually not a good idea to sell into a major market correction. As the saying goes: "Don't just stand there! Do nothing!"

 

[Ron Texas]

Looking at the equity markets today, my advice is:

Stow your tray tables. Put your seat back in the upright and locked position. Put away your laptop computer, and make sure your carry-ons are under the seat in front of you, or in an overhead bin. Make sure your seatbelt is low across your hips and tight.

Oh yeah... it's usually not a good idea to sell into a major market correction. As the saying goes: "Don't just stand there! Do nothing!"

Right you are. I will be in the car all day which will keep me away from the computer.

 

[JeffS7444]

It's funny when stocks fall people run away. This morning was an ideal time to add to my SPY position.
I love these days.
Long 511

Not much to be said: The market still appears to be falling, and for how long, who knows.

The crash of 2008 was memorable: I had been hankering for a secondhand Mini and went to check the balance of one of my actively-managed mutual funds (when I was still doing that). My would-be Mini had vanished! Turned out that the star fund manager had completely underestimated the scope of the subprime housing market, and had gone big on stocks like Washington Mutual - whoops. The fund eventually recovered it's previous value, but it took something like 18 months. And by that point, I was no longer in a car-buying mood.

 

[Koeitje]

Anyway, I bought some more NT World. I don't try and pick individual stocks and aren't in it for the shortterm anyway.

 

[JeffS7444]

 

[TurtlePaul]

It is east to say in hindsight to buy the 08 dip. The market peaked in October 07 then bounced off -10% in November 07 and bounced off -20% in January and March 08. The market lost some steam over the summer then bounced off ~-25% in July to be 10% off the lows in August. There were dip buyers in each of those four prolonged dips.

All those dip buyers were all above 1200. The market bottomed in 2009 at 666. It wasn’t like the market got incredibly cheap one day and people were rolling in cash. Dip buyers got slaughtered over and over.

Of course, between 2009 and 2014 or so, every time the market pulled back 5% there was a certain portion of the financial press calling it the next leg in the 08 downturn.

You never know when a dip is a good buy the dip or is the November 07 ‘buy the dip’. I personally like to look at valuation and some of those are crazy right now. I am not buying this dip with my spare funds but my typical retirement contributions continue.

 

[kemmler3D]

I made a decent profit from '08 because there were a lot of stocks falling that had no obvious connection to the economic conditions supposedly causing the crash. In that case it was auto manufacturers and lenders having trouble. Random blue chips not directly connected to those bounced back handily.

In this case as far as I can tell there's no one industry under duress, just Intel taking a crap and everyone else scared about jobs / interest rates. So I'm more inclined to wait for something that looks like the bottom before buying.

 

[JeffS7444]

I haven't got the stomach for day trading. If I didn't go bargain-hunting in the aftermath of 2008's market crash, it's because my money was tied up in a fund which had tanked, but I was reasonably confident that I'd be okay in the long run if I just did nothing. Which worked out pretty well, but once I learned about John Bogle and low-cost index funds, I got out of actively-managed funds. But admit that it's only recently that I've seen the math which reveals why seemingly small management fees can take an enormous chunk out of one's gains!

It must have been around 2000-2002 when I purchased Berkshire Hathaway "B" shares in the $40/share range. Have never sold a single one.

 

[JeffS7444]

There's a number of different videos with the theme of "Why your net worth explodes once you have 100K", and George Kamel does a good job of presenting the math. Compound interest is the sweet, sweet money you earn while sitting on your butt watching capybara videos on YT.

 

[JeffS7444]

Americans Think They Need $2.5M To Be Wealthy:
https://qz.com/wealth-financial-comfort-retirement-charles-schwab-1851628849
How survey participants arrived at that amount, I don't know, so interpret as you will.

 

[levimax]

Long VOO 505.98

Curious as to why you would use VOO instead of SPY for trading ?

 

[JeffS7444]

Curious as to why you would use VOO instead of SPY for trading ?

I'm guessing that @amper42 is looking at the lower expense ratio (0.04% vs 0.10%), but to be honest, I'm really not clued into the why-bother of ETFs.

 

[levimax]

I'm guessing that @amper42 is looking at the lower expense ratio (0.04% vs 0.10%), but to be honest, I'm really not clued into the why-bother of ETFs.

For long term investing VOO has a slightly lower expense ratio but for trading the SPY has an order of magnitude greater volume which equates to better liquidity and tighter bid ask spreads. For short term trading liquidity is more important than expense ratio but for long term investing the expense ratio is more of a concern. Usually when someone mentions "low ticking" the market, i.e. buying at the low price of the day like amper42 did, it is usually a trade. I was just curious if he considers this a trade or a long term investment and if a trade why the VOO.