Side Hustle
05-17-2018 | 08:00 AM
#71
Banned
Joined: Apr 2017
Posts: 4,208
Likes: 7
The reason you have the most money in a particular set of companies on a market cap weighted fund is because they GREW to that spot. And so did your money along with it. AAPL wasn’t always at the top.... If you choose another method then you’re looking for a small cap index, perhaps where the next Apple and Amazon will grow into their size, but there are likely to be wild fluctuations and greater risk associated. The S&P 500 or total stock index are hands down the best option we have available to us to “set it and forget it”. You can always zoom in on a particular point in time on a chart and say “HA, look at the lack of growth here” then I can zoom in on 2008-present day and say “HA, look at all this growth in the S&P” AND THEN we can zoom all the way out and see that, in general, the market has gone up over its life. So for us younger guys with decades ahead of us, it’s our safest bet. Runner up are target retirement funds, but they bring more managers into it and thus higher fees.
You cite Mr Winkler, so I’ll cite Mr Buffett;
___________
“Let me give you a figure that’ll blow your mind I think. I bought my first stock when I was 11 years old. It was the first quarter of 1942, shortly after Pearl Harbor,” Buffett recalls. “I spent $114.75, [for] shares [of a stock.] $114.75. If I put that $114 into the S&P 500 at that time and reinvested the dividends, think of a figure as to what it…would be worth today,” he asked me?
So, what do think?
$10,000?
$75,000?
I’ll give you some help. That’s way low.
Let’s pick it up with Buffett again: “The answer is about $400,000. So if I as a little kid had taken that 114 bucks I’d saved— shoveling snow (LAUGH) or whatever I’d done, [I’d have] $400,000 today. [In] one person’s lifetime. That’s America. I mean, that isn’t me. You know, it’s the huge tailwind the American economy gives to any equity investor.”
https://finance.yahoo.com/news/warre...230140222.html
____________
You cite Mr Winkler, so I’ll cite Mr Buffett;
___________
“Let me give you a figure that’ll blow your mind I think. I bought my first stock when I was 11 years old. It was the first quarter of 1942, shortly after Pearl Harbor,” Buffett recalls. “I spent $114.75, [for] shares [of a stock.] $114.75. If I put that $114 into the S&P 500 at that time and reinvested the dividends, think of a figure as to what it…would be worth today,” he asked me?
So, what do think?
$10,000?
$75,000?
I’ll give you some help. That’s way low.
Let’s pick it up with Buffett again: “The answer is about $400,000. So if I as a little kid had taken that 114 bucks I’d saved— shoveling snow (LAUGH) or whatever I’d done, [I’d have] $400,000 today. [In] one person’s lifetime. That’s America. I mean, that isn’t me. You know, it’s the huge tailwind the American economy gives to any equity investor.”
https://finance.yahoo.com/news/warre...230140222.html
____________
A portfolio should be diversified among large and small value, large stocks, small stocks, large and small international. Those asset categories should be in certain proportions and then re-balanced when they get out of proportion. That achieves the highest reward with the lowest level risk, something an index fund doesn't do.
05-17-2018 | 08:35 AM
#72
Gets Weekends Off
Joined: Apr 2007
Posts: 5,609
Likes: 623
Too many miss this valuable point when embarking on a side hustle. If you are managing properties, fixing toilets, painting, etc, you might as well print up business cards that say handyman. Just because you CAN do this work, doesn't mean you SHOULD. Embrace your specialty and let the other trades embrace theirs. Besides, if the investment can't support market rates for repairs and maintenance, it isn't really an investment.
05-17-2018 | 09:36 AM
#73
Moderator
Joined: Jul 2006
Posts: 7,481
Likes: 478
Too many miss this valuable point when embarking on a side hustle. If you are managing properties, fixing toilets, painting, etc, you might as well print up business cards that say handyman. Just because you CAN do this work, doesn't mean you SHOULD. Embrace your specialty and let the other trades embrace theirs. Besides, if the investment can't support market rates for repairs and maintenance, it isn't really an investment.
05-17-2018 | 09:43 AM
#74
Line Holder
Joined: Feb 2011
Posts: 784
Likes: 7
Buffett's not wrong, but one can make the same amount of money for less risk by being more diverse.
A portfolio should be diversified among large and small value, large stocks, small stocks, large and small international. Those asset categories should be in certain proportions and then re-balanced when they get out of proportion. That achieves the highest reward with the lowest level risk, something an index fund doesn't do.
A portfolio should be diversified among large and small value, large stocks, small stocks, large and small international. Those asset categories should be in certain proportions and then re-balanced when they get out of proportion. That achieves the highest reward with the lowest level risk, something an index fund doesn't do.
http://genxfinance.com/avoid-fund-overlap-to-achieve-true-diversification-in-your-portfolio/
I’m not saying anyone is wrong here, the important thing is that money is being saved and invested. I can’t stand that the financial industry makes this seem so scary and over complicated and charge us huge fees to make us feel like we are safer, when it usually ends up the opposite. Just got to find what works for you and you’re comfortable with.
05-17-2018 | 01:11 PM
#79
Can't abide NAI
Joined: Jun 2007
Posts: 12,078
Likes: 15
From: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
Word on the street is that the next revision of the FOM will prohibit any side hustle work on any calendar day you have an obligation to Delta. You won't be able to do anything while on short call, long call, short layover, long layover, vacation day, 30-hour rest... and not even after release or before sign-in.
05-17-2018 | 01:22 PM
#80
Can't abide NAI
Joined: Jun 2007
Posts: 12,078
Likes: 15
From: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
That is nearly an exact match of my first rental property purchase. It's amazing how good the numbers really are over decade or more. Splitting investments evenly between the DC plan and real estate for the last decade has created a buy and hold portfolio with more equity than the retirement plan. The portfolio also produces monthly cash flow that the retirement plan does not. I'm a huge fan of buy and hold real estate as part of a retirement plan.
In 2015 my sort term gains were taxed at 51% after AMT, State and investment taxes specific to 1099 income from the company that runs the properties for me.
The real estate business was only ever intended to be a supplement to retirement. It makes sense to roll all of this forward in the IRA and tax it when you retire.
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