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Posted: 2/18/2017 5:40:56 AM EDT
What does GD's financial experts say about this?

Clearly a bull market.  Already, the YTD returns on many of my funds are as high as 8%.  Some funds in the fidelity brokerage account I have are now exceeding historical prices for the past year or two and the YTD return on those funds is already over 11%.

My fear is that by contributing in this market, I'll be setting myself up for a crash later.

Anything I should be doing?  Reducing contributions and putting that money into cash reservers?  Changing future investment choices from what are largely stock funds to bond funds that aren't really rallying as much right now, or even just putting them into a retirement fund (T. Rowe Price Retirement 2005 Fund is my option here).
Link Posted: 2/18/2017 6:02:48 AM EDT
[#1]
It might depend on how close to retirement you are for how aggressive you want to be. If you can make 11% you should try to do that for as long as possible I'd think. 
Link Posted: 2/18/2017 6:06:35 AM EDT
[#2]
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Quoted:
It might depend on how close to retirement you are for how aggressive you want to be. If you can make 11% you should try to do that for as long as possible I'd think. 
View Quote


I turn 50 this year...I need to try to get at least another decade from this job.  Currently Im putting in 12% into some aggressive funds (trying to make up for lost time) and was going to increase that to 15% when this years salary increase comes through.  

Maybe it's time to pull back and put money into more conservative areas until the market settles down ?
Link Posted: 2/18/2017 6:08:04 AM EDT
[#3]
So the market is doing well and you want to throttle your gains?

This makes no sense. Enjoy the ride.
Link Posted: 2/18/2017 6:10:05 AM EDT
[#4]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
So the market is doing well and you want to throttle your gains?

This makes no sense. Enjoy the ride.
View Quote


I never said I was a genius at this..

I am just worried that by continuing to put money into funds that are now performing better than they have in years, that I am setting myself up for future losses if this trend reverses.
Link Posted: 2/18/2017 6:20:18 AM EDT
[#5]
You're trying to time the market.

Anyone who says they can time the market is lying to you.

You may protect yourself form losses, but you may also miss out on more gains.

Your call, no one else's.

Asset allocation is another question. I personally wouldn't have all my eggs in the equities basket, and don't.
Link Posted: 2/18/2017 6:29:49 AM EDT
[#6]
If President Trump gets half of what he wants (and Ryan says they will do), the market is just beginning to rally.

Are you still investing (for 5ish years or longer) or are you living off of your investments?

If you don't put enough in equities now (especially with real interest rates <0) you aren't going to have enough to put into fixed income when it is time to live off of them.

No guts, no glory...nor $.
Link Posted: 2/18/2017 6:32:59 AM EDT
[#7]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
If President Trump gets half of what he wants (and Ryan says they will do), the market is just beginning to rally.

Are you still investing (for 5ish years or longer) or are you living off of your investments?

If you don't put enough in equities now (especially with real interest rates <0) you aren't going to have enough to put into fixed income when it is time to live off of them.

No guts, no glory...nor $.
View Quote


Still investing...as stated previously Im in for another decade at least.

Just to be clear, by equities you essentially mean stock funds right?
Link Posted: 2/18/2017 6:38:27 AM EDT
[#8]
My 401k is doing so well it's scary honestly. I'm waiting for the crash where I lose half of it.
Link Posted: 2/18/2017 6:42:06 AM EDT
[#9]
Discussion ForumsJump to Quoted PostQuote History
Quoted:


I never said I was a genius at this..

I am just worried that by continuing to put money into funds that are now performing better than they have in years, that I am setting myself up for future losses if this trend reverses.
View Quote View All Quotes
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Discussion ForumsJump to Quoted PostQuote History
Quoted:
Quoted:
So the market is doing well and you want to throttle your gains?

This makes no sense. Enjoy the ride.


I never said I was a genius at this..

I am just worried that by continuing to put money into funds that are now performing better than they have in years, that I am setting myself up for future losses if this trend reverses.


Two things to consider:

1.  There are those who have been sitting on the sidelines waiting for the proverbial 10% pullback before they jump in...and they've been doing so for years.  Think of the gains they've missed.

2.  Sooner or later the market is going to go down...consider it a buying opportunity.
Link Posted: 2/18/2017 6:52:01 AM EDT
[#10]
Discussion ForumsJump to Quoted PostQuote History
Quoted:


I never said I was a genius at this..

I am just worried that by continuing to put money into funds that are now performing better than they have in years, that I am setting myself up for future losses if this trend reverses.
View Quote

You are being smart thinking about it. 

Because nothing lasts forever at some point it will go down, then back up. For someone young it might be enough time to recover, for someone depending on that money for retirement, maybe not. 

That's the whole risk vs reward thing 

I think the smartest thing to do would be to have a goal for retirement. Then what would it take to reach that goal? If you can reach it with less risk that's a good thing. If you can reach it and still have a little "play" money for something with more potential reward but if it goes down you're not depending on it, even better. 
Link Posted: 2/18/2017 7:05:01 AM EDT
[#11]
Discussion ForumsJump to Quoted PostQuote History
Quoted:


Still investing...as stated previously Im in for another decade at least.

Just to be clear, by equities you essentially mean stock funds right?
View Quote View All Quotes
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Discussion ForumsJump to Quoted PostQuote History
Quoted:
Quoted:
If President Trump gets half of what he wants (and Ryan says they will do), the market is just beginning to rally.

Are you still investing (for 5ish years or longer) or are you living off of your investments?

If you don't put enough in equities now (especially with real interest rates <0) you aren't going to have enough to put into fixed income when it is time to live off of them.

No guts, no glory...nor $.


Still investing...as stated previously Im in for another decade at least.

Just to be clear, by equities you essentially mean stock funds right?


My bad:  I missed one of your subsequent posts while I was typing.

Yes, equities = stock; equity funds = stock funds.

Bohr_Adam brings up a good point:  asset allocation.  Establishing a % of stocks (domestic, foreign (developed), emerging markets, etc.) & bonds in your portfolio and then more or less "blindly" (maybe religiously and/or periodically are better terms) maintaining that %.

Asset allocation is also, BTW, essentially what your target retirement date fund is doing:  something like more or less your age is the % they put in bonds, the rest in equities.  As you get older, they shift more of your $ to bonds which, at least in theory, should be "safer".
Link Posted: 2/18/2017 8:42:52 AM EDT
[#12]
Link Posted: 2/18/2017 8:43:24 AM EDT
[#13]
If this was a regular taxable account where you were just investing extra money, maybe it would make sense to sell to lock in some gains if you thought the market was high (buy low, sell high) and you wanted to actually use the money in the near future.  As others have said, timing this is really not possible -- after all Trump being elected was supposed to result in a market crash according to the experts, and the exact opposite happened (and who knows what will happen in the future).

But a 401K should be allocated based on how close you are to retirement (i.e. still based on when you will need the money), not based on current market sentiment.  If you still have time to weather a downturn and rebound, you should stay invested in the stock market.

Frankly, even when retired you should have some money in the market because you still have a decades long investing horizon for some portion of your investments.  Like if you have $200,000 and retire at 65 and plan to live on that, you have to plan that you'll live at least 20 years.
Link Posted: 2/18/2017 9:00:15 AM EDT
[#14]
60 here, putting 26% in,plus a 4% match. Maxing it out yearly. $24500. My plan is to go to 67 and call it good, hoping for the best.
Link Posted: 2/18/2017 9:08:24 AM EDT
[#15]
You can't time the market.  A better option would be to figure out an assett allocation that works for you then keep investing and ignore the noise.
Link Posted: 2/18/2017 9:09:26 AM EDT
[#16]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
My 401k is doing so well it's scary honestly. I'm waiting for the crash where I lose half of it.
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Hey, it just means we live more frugally if it happens just before retirement.

My 401k looks pretty amazing as well.
Link Posted: 2/18/2017 9:10:04 AM EDT
[#17]
I continue to contribute the maximum. It's called dollar cost averaging.

I wouldn't reduce your contribution if I were you.
Link Posted: 2/18/2017 9:11:17 AM EDT
[#18]
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Quoted:
You can't time the market.  A better option would be to figure out an assett allocation that works for you then keep investing and ignore the noise.
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Amen.
Link Posted: 2/18/2017 9:19:20 AM EDT
[#19]
I have half my 401k money in the Fidelity general income fund and the other half in the 2035 target retirement fund. I realize this is a shitty plan, and why I'm only up 2%. At this point I seriously want to say fuck it and pull half my money out and start flipping houses or something. What the hell can I do to make better gains but still stay relatively safe?

38 years old, only been seriously contributing for 5 years, and next week I'll finally hit the $100k mark and also hit my $18k threshhold for 2017. Plan to add another $11k via 2016 and 2017 TIRA limits.

Where the fuck should I be spreading this money at on Fidelity?
Link Posted: 2/18/2017 9:19:20 AM EDT
[#20]
The problem I have with the stock market right now is it is all built up on HOPE and DREAMS. Companies aren't making enough to pay real dividends and people just buy on the speculation of capital appreciation. Yes, the corporate leaders have incentives for their stock to increase so they can use their options, but afterwards things right themselves, companies collapse, merge, etc.

I don't expect to retire for 30 years and still put $12k into my 401k just like alot of people my age, but am really starting to wonder how sustainable this path is. That money is only about $4k per year equivalent if I didn't meet my companies match... no way could I park it anywhere else and get 100% returns without unrealistic risk.

The game feels rigged and I'm being forced to play by others rules. One day I'm expecting to be told these funds won't be accessible until age 70 without massive tax penalties, just to fuck over my generation and keep retired pensioners afloat.
Link Posted: 2/18/2017 9:22:25 AM EDT
[#21]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
I have half my 401k money in the Fidelity general income fund and the other half in the 2035 target retirement fund. I realize this is a shitty plan, and why I'm only up 2%. At this point I seriously want to say fuck it and pull half my money out and start flipping houses or something. What the hell can I do to make better gains but still stay relatively safe?

38 years old, only been seriously contributing for 5 years, and next week I'll finally hit the $100k mark and also hit my $18k threshhold for 2017. Plan to add another $11k via 2016 and 2017 TIRA limits.

Where the fuck should I be spreading this money at on Fidelity?
View Quote


Read Bogleheads and set up a simple 3 fund portfolio consisting of only index funds (total market, total international market, total bond market). Adjust allocation based on age and time to retirement.
Link Posted: 2/18/2017 9:29:22 AM EDT
[#22]
I would aim to keep investing the max 18k per year.

As others have mentioned, if your worried about the risk you might look at bond funds or dividend paying stock funds.
Link Posted: 2/18/2017 9:42:23 AM EDT
[#23]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
I turn 50 this year...I need to try to get at least another decade from this job.  Currently Im putting in 12% into some aggressive funds (trying to make up for lost time) and was going to increase that to 15% when this years salary increase comes through.  

Maybe it's time to pull back and put money into more conservative areas until the market settles down ?
View Quote View All Quotes
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Discussion ForumsJump to Quoted PostQuote History
Quoted:
I turn 50 this year...I need to try to get at least another decade from this job.  Currently Im putting in 12% into some aggressive funds (trying to make up for lost time) and was going to increase that to 15% when this years salary increase comes through.  

Maybe it's time to pull back and put money into more conservative areas until the market settles down ?
12% of your pay or 12% of the contribution?  I would look at overall asset allocation.

Quoted:
The problem I have with the stock market right now is it is all built up on HOPE and DREAMS. Companies aren't making enough to pay real dividends and people just buy on the speculation of capital appreciation. Yes, the corporate leaders have incentives for their stock to increase so they can use their options, but afterwards things right themselves, companies collapse, merge, etc.

I don't expect to retire for 30 years and still put $12k into my 401k just like alot of people my age, but am really starting to wonder how sustainable this path is. That money is only about $4k per year equivalent if I didn't meet my companies match... no way could I park it anywhere else and get 100% returns without unrealistic risk.

The game feels rigged and I'm being forced to play by others rules. One day I'm expecting to be told these funds won't be accessible until age 70 without massive tax penalties, just to fuck over my generation and keep retired pensioners afloat.
You sound about my age.  We came of age during 2 bubbles.  To me, it looks like another one in the making.  I am still contributing to mine but am more conservatively allocated.  I will reallocate with the dry powder once the thinning has happened.
Link Posted: 2/18/2017 10:05:16 AM EDT
[#24]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
The problem I have with the stock market right now is it is all built up on HOPE and DREAMS. Companies aren't making enough to pay real dividends and people just buy on the speculation of capital appreciation. Yes, the corporate leaders have incentives for their stock to increase so they can use their options, but afterwards things right themselves, companies collapse, merge, etc.

I don't expect to retire for 30 years and still put $12k into my 401k just like alot of people my age, but am really starting to wonder how sustainable this path is. That money is only about $4k per year equivalent if I didn't meet my companies match... no way could I park it anywhere else and get 100% returns without unrealistic risk.

The game feels rigged and I'm being forced to play by others rules. One day I'm expecting to be told these funds won't be accessible until age 70 without massive tax penalties, just to fuck over my generation and keep retired pensioners afloat.
View Quote


Our system is designed for booms and busts. 

Don't make decisions based on feelings. We have 100+ years of data. The market always goes up with hiccups along the way. 

People that try to time this and change their allocations or reduce their contributions usually do significant damage.
Link Posted: 2/18/2017 10:31:15 AM EDT
[#25]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
You're trying to time the market.

Anyone who says they can time the market is lying to you.

You may protect yourself form losses, but you may also miss out on more gains.

Your call, no one else's.

Asset allocation is another question. I personally wouldn't have all my eggs in the equities basket, and don't.
View Quote
Only the one thrusting knows when to pull out.  Even then, some won't pull out.  Daddy.  
Link Posted: 2/18/2017 10:32:19 AM EDT
[#26]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
So the market is doing well and you want to throttle your gains?

This makes no sense. Enjoy the ride.
View Quote
GD finance threads are awesome. 
Link Posted: 2/18/2017 10:43:04 AM EDT
[#27]
Discussion ForumsJump to Quoted PostQuote History
Quoted:


Our system is designed for booms and busts. 

Don't make decisions based on feelings. We have 100+ years of data. The market always goes up with hiccups along the way. 

People that try to time this and change their allocations or reduce their contributions usually do significant damage.
View Quote View All Quotes
View All Quotes
Discussion ForumsJump to Quoted PostQuote History
Quoted:
Quoted:
The problem I have with the stock market right now is it is all built up on HOPE and DREAMS. Companies aren't making enough to pay real dividends and people just buy on the speculation of capital appreciation. Yes, the corporate leaders have incentives for their stock to increase so they can use their options, but afterwards things right themselves, companies collapse, merge, etc.

I don't expect to retire for 30 years and still put $12k into my 401k just like alot of people my age, but am really starting to wonder how sustainable this path is. That money is only about $4k per year equivalent if I didn't meet my companies match... no way could I park it anywhere else and get 100% returns without unrealistic risk.

The game feels rigged and I'm being forced to play by others rules. One day I'm expecting to be told these funds won't be accessible until age 70 without massive tax penalties, just to fuck over my generation and keep retired pensioners afloat.


Our system is designed for booms and busts. 

Don't make decisions based on feelings. We have 100+ years of data. The market always goes up with hiccups along the way. 

People that try to time this and change their allocations or reduce their contributions usually do significant damage.
I wonder why that is...
Link Posted: 2/18/2017 10:52:44 AM EDT
[#28]
Link Posted: 2/18/2017 10:57:43 AM EDT
[#29]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
12% of your pay or 12% of the contribution?  I would look at overall asset allocation.

You sound about my age.  We came of age during 2 bubbles.  To me, it looks like another one in the making.  I am still contributing to mine but am more conservatively allocated.  I will reallocate with the dry powder once the thinning has happened.
View Quote


I'm mid-thirties and make low six-figures. A few guys I work with making more are maxing out their 401ks and then putting in another  $10k after tax on the basis they'll be able to pull those contributions first tax free when they retire. Seems like a lot of trust that the greedy politicians won't screw everyone over when times get tough in 20-30 years (debt default, war, who knows?).

I'm planning to keep the company match, but putting my extra money into a Share builder account with no strings attached.
Link Posted: 2/18/2017 11:15:33 AM EDT
[#30]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
You're trying to time the market.

Anyone who says they can time the market is lying to you.

You may protect yourself form losses, but you may also miss out on more gains.

Your call, no one else's.

Asset allocation is another question. I personally wouldn't have all my eggs in the equities basket, and don't.
View Quote



This.  Hire a professional to give you advice based on facts and expertise, without emotional ties to the money.

Everyone has emotions about money, which many times leads to bad decisions.  There are studies that even say Certified Financial Planners underperform their clients because of emotions they have about their own money.  


Hire a professional with credentials (CFP, ChFC) and let them help you.
Link Posted: 2/18/2017 11:21:23 AM EDT
[#31]
1) Take all your money out.
2) Fly to Vegas.
3) Put half on Red and half on Black, so you're guaranteed to win either way.
4) Profit!!!
Link Posted: 2/18/2017 11:22:12 AM EDT
[#32]
Op are your fees low? Because that's important
Link Posted: 2/18/2017 11:32:41 AM EDT
[#33]
Financial advice threads in GD are right up there with divorce advice threads.
Link Posted: 2/18/2017 11:43:30 AM EDT
[#34]
What is rehypothecation?
Link Posted: 2/18/2017 11:45:44 AM EDT
[#35]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
I have half my 401k money in the Fidelity general income fund and the other half in the 2035 target retirement fund. I realize this is a shitty plan, and why I'm only up 2%. At this point I seriously want to say fuck it and pull half my money out and start flipping houses or something. What the hell can I do to make better gains but still stay relatively safe?

38 years old, only been seriously contributing for 5 years, and next week I'll finally hit the $100k mark and also hit my $18k threshhold for 2017. Plan to add another $11k via 2016 and 2017 TIRA limits.

Where the fuck should I be spreading this money at on Fidelity?
View Quote


I have.Fidelity.   Their target funds SUCK.   Go look at the 10 year return on that fund..: it is terrible.   I do 30% large cap growth, 20% small, 20% bond index, 10% emerging markets, 20% small cap.   And keep rebalancing.
Link Posted: 2/18/2017 11:48:47 AM EDT
[#36]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
I'm mid-thirties and make low six-figures. A few guys I work with making more are maxing out their 401ks and then putting in another  $10k after tax on the basis they'll be able to pull those contributions first tax free when they retire. Seems like a lot of trust that the greedy politicians won't screw everyone over when times get tough in 20-30 years (debt default, war, who knows?).

I'm planning to keep the company match, but putting my extra money into a Share builder account with no strings attached.
View Quote
Similar age and income.  I am doing the 401k, fund a Roth IRA, have a personal stock account, and have some money in metals.  Diversification seems to be key.  I agree they can change the rules.
Link Posted: 2/18/2017 11:49:53 AM EDT
[#37]
Discussion ForumsJump to Quoted PostQuote History
Quoted:


I have.Fidelity.   Their target funds SUCK.   Go look at the 10 year return on that fund..: it is terrible.   I do 30% large cap growth, 20% small, 20% bond index, 10% emerging markets, 20% small cap.   And keep rebalancing.
View Quote View All Quotes
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Discussion ForumsJump to Quoted PostQuote History
Quoted:
Quoted:
I have half my 401k money in the Fidelity general income fund and the other half in the 2035 target retirement fund. I realize this is a shitty plan, and why I'm only up 2%. At this point I seriously want to say fuck it and pull half my money out and start flipping houses or something. What the hell can I do to make better gains but still stay relatively safe?

38 years old, only been seriously contributing for 5 years, and next week I'll finally hit the $100k mark and also hit my $18k threshhold for 2017. Plan to add another $11k via 2016 and 2017 TIRA limits.

Where the fuck should I be spreading this money at on Fidelity?


I have.Fidelity.   Their target funds SUCK.   Go look at the 10 year return on that fund..: it is terrible.   I do 30% large cap growth, 20% small, 20% bond index, 10% emerging markets, 20% small cap.   And keep rebalancing.
Vanguard Target funds don't, below is the 24 month return rate on my Vanguard Target Roth 

Link Posted: 2/18/2017 11:52:32 AM EDT
[#38]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
Vanguard Target funds don't, below is the 24 month return rate on my Vanguard Target Roth 

http://i.imgur.com/oUUmxqH.png
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Discussion ForumsJump to Quoted PostQuote History
Quoted:
Quoted:
Quoted:
I have half my 401k money in the Fidelity general income fund and the other half in the 2035 target retirement fund. I realize this is a shitty plan, and why I'm only up 2%. At this point I seriously want to say fuck it and pull half my money out and start flipping houses or something. What the hell can I do to make better gains but still stay relatively safe?

38 years old, only been seriously contributing for 5 years, and next week I'll finally hit the $100k mark and also hit my $18k threshhold for 2017. Plan to add another $11k via 2016 and 2017 TIRA limits.

Where the fuck should I be spreading this money at on Fidelity?


I have.Fidelity.   Their target funds SUCK.   Go look at the 10 year return on that fund..: it is terrible.   I do 30% large cap growth, 20% small, 20% bond index, 10% emerging markets, 20% small cap.   And keep rebalancing.
Vanguard Target funds don't, below is the 24 month return rate on my Vanguard Target Roth 

http://i.imgur.com/oUUmxqH.png



What is the ticker of that fund?  Or just the name?
Link Posted: 2/18/2017 11:53:07 AM EDT
[#39]
Discussion ForumsJump to Quoted PostQuote History
Quoted:



This.  Hire a professional to give you advice based on facts and expertise, without emotional ties to the money.

Everyone has emotions about money, which many times leads to bad decisions.  There are studies that even say Certified Financial Planners underperform their clients because of emotions they have about their own money.  


Hire a professional with credentials (CFP, ChFC) and let them help you.
View Quote

I respectfully disagree with hiring a professional. They leech off your gains. 

Low cost index funds without professional help are an easy way to diversify while keeping costs low and being tax efficient. 
Link Posted: 2/18/2017 11:54:53 AM EDT
[#40]
DOw 50,000 guaranteed baby

dont miss the train ride!
Link Posted: 2/18/2017 11:58:30 AM EDT
[#41]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
So the market is doing well and you want to throttle your gains?

This makes no sense. Enjoy the ride.
View Quote


Gains are not realized unless you sell.....
Link Posted: 2/18/2017 12:01:05 PM EDT
[#42]
Discussion ForumsJump to Quoted PostQuote History
Quoted:

I respectfully disagree with hiring a professional. They leech off your gains. 

Low cost index funds without professional help are an easy way to diversify while keeping costs low and being tax efficient. 
View Quote View All Quotes
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Discussion ForumsJump to Quoted PostQuote History
Quoted:
Quoted:



This.  Hire a professional to give you advice based on facts and expertise, without emotional ties to the money.

Everyone has emotions about money, which many times leads to bad decisions.  There are studies that even say Certified Financial Planners underperform their clients because of emotions they have about their own money.  


Hire a professional with credentials (CFP, ChFC) and let them help you.

I respectfully disagree with hiring a professional. They leech off your gains. 

Low cost index funds without professional help are an easy way to diversify while keeping costs low and being tax efficient. 


I respectfully disagree for a few reasons. Number 1 is that a true professional does financial planning....something you do not get with a fund. By that I mean tailored advice to accomplish your goals, and protect against setbacks.  There is SO much more than just investment picks in financial planning.  You would probably be amazed at the areas true planners can address.  

Second, fees and taxes are just parts of the equation,  with fees being the most overrated by far.  A good professional will keep fees low. The people that lead with fees as a reason not to work with a pro are being "penny wise, pound foolish".  As an example, look at how Vanguard stacks up to other fund families.  I REALLY like Vanguard, but they are not always the best.  As far as leeching off of gains....do you feel the same way about paying a CPA for doing your taxes?  A lawyer for drafting a will?  A doctor for diagnosing an illness?  Do you do all of that yourself?

Third, look up research on the emotional part I posted above.  If you have a mindset that you can outperform the market, or do your own allocation,  or want to pinch pennies with fees, you are probably exactly the type of person who needs to take emotions out of the equation.  

Just my humble opinion. Full disclosure, I'm a CFP and have been in financial services in varying capacities for 9 years.
Link Posted: 2/18/2017 12:07:25 PM EDT
[#43]
Discussion ForumsJump to Quoted PostQuote History
Quoted:


I respectfully disagree for a few reasons. Number 1 is that a true professional does financial planning....something you do not get with a fund. By that I mean tailored advice to accomplish your goals, and protect against setbacks.  There is SO much more than just investment picks in financial planning.  You would probably be amazed at the areas true planners can address.  

Second, fees and taxes are just parts of the equation,  with fees being the most overrated by far.  A good professional will keep fees low. The people that lead with fees as a reason not to work with a pro are being "penny wise, pound foolish".  As an example, look at how Vanguard stacks up to other fund families.  I REALLY like Vanguard, but they are not always the best.  As far as leeching off of gains....do you feel the same way about paying a CPA for doing your taxes?  A lawyer for drafting a will?  A doctor for diagnosing an illness?  Do you do all of that yourself?

Third, look up research on the emotional part I posted above.  If you have a mindset that you can outperform the market, or do your own allocation,  or want to pinch pennies with fees, you are probably exactly the type of person who needs to take emotions out of the equation.  

Just my humble opinion. Full disclosure, I'm a CFP and have been in financial services in varying capacities for 9 years.
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Thanks for the clarification and disclosure. I agree in the context you provided. I was disagreeing in the context of people thinking they're going to beat the market with a professional.
Link Posted: 2/18/2017 12:10:42 PM EDT
[#44]
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Quoted:

Where the fuck should I be spreading this money at on Fidelity?
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Contrafund, Puritan, Blue Chip Growth, Balanced Fund, New Millennium, etc.  Fidelity has many great aggressive equity funds.
Link Posted: 2/18/2017 12:21:36 PM EDT
[#45]
I've got a likely stupid question...

Why should I not put all of my 401k money into the small cap stock fund or the s&p fund? The 10 year average return rate of these two funds are almost double the return rate of the diversified funds. I won't be retiring for 20 years.
Link Posted: 2/18/2017 12:28:32 PM EDT
[#46]
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Quoted:
I've got a likely stupid question...

Why should I not put all of my 401k money into the small cap stock fund or the s&p fund? The 10 year average return rate of these two funds are almost double the return rate of the diversified funds. I won't be retiring for 20 years.
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My 401k is 80% small cap index and 20% total US market index. My post tax account is 80% Wellington and 20% total international index. Works for me. 
Link Posted: 2/18/2017 12:31:17 PM EDT
[#47]
Discussion ForumsJump to Quoted PostQuote History
Quoted:
I've got a likely stupid question...

Why should I not put all of my 401k money into the small cap stock fund or the s&p fund? The 10 year average return rate of these two funds are almost double the return rate of the diversified funds. I won't be retiring for 20 years.
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Not a stupid question.  Two thoughts:

1)  You can get more aggressive with a longer a time horizon.

2)  Small cap funds might have been a top performer for the past 10 years but they aren't necessarily the top performer over EVERY 10 year period.  Different fund styles come and go on the leader board all the time.  There is no guarantee that the same small cap fund will outperform the alternatives over the next 10 years.
Link Posted: 2/18/2017 12:39:56 PM EDT
[#48]
Link Posted: 2/18/2017 12:44:35 PM EDT
[#49]
Link Posted: 2/18/2017 12:51:34 PM EDT
[#50]
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Discussion ForumsJump to Quoted PostQuote History
Quoted:
Quoted:
I've got a likely stupid question...

Why should I not put all of my 401k money into the small cap stock fund or the s&p fund? The 10 year average return rate of these two funds are almost double the return rate of the diversified funds. I won't be retiring for 20 years.


http://i.imgur.com/N7C6Loo.png


if you bought into the sp500 regularly, like $10000 at the end of every year, wouldnt you come out way ahead at the end of that time period?

if you only bought once at the beginning, and never invested again, sure you would not make much
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