If I were you, I would go talk to a Schwab rep. Some people are candidates for annuities, others are not. There are good ones and bad ones.
If you do not know all the ins and outs of this product, don't sign. I did and I'm not too happy about it.
Investing Strategies. What is your move?
- Thread starter PimTac
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If you do not know all the ins and outs of this product, don't sign. I did and I'm not too happy about it.
Owen Lucas
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I'll have to ask him for more details. What are you not happy about? Can't cash out early?
I am not a good candidate for an annuity. Fidelity sold me one. It's on me because I bought it. But I trusted my rep.
Annuities can be good for people who need fixed payments. That's not me.
Owen Lucas
$100 Site Donor 2023
- Joined
- Sep 5, 2021
- Messages
- 2,658
We are fine with locking up the money for 5 years, it's not a huge chunk, but better than nothing.
Read the prospectus very carefully. If you need extra money besides the regular payout there will likely be a penalty fee.
I know NOTHING about annuities. However if its not a big chunk, and your not hunting for yield, you can buy a 5 year treasury note. End of February they were 4.1%. Unfortunately they have fallen a fair bit recently - last auction was only 3.67%, but it has come up again since then. They don't auction 5 years that often.
2 year is over 4% still.
Good part about Treasuries - if you buy them in your brokerage account you can sell them with the click of a mouse - although I think there might be a minimum hold time - 45 days rings a bell - I would need to look again.
For most people there is no state income tax on treasuries, so you might want to look into that also. It still won't make up the difference, but its something.
You‘re 100% correct and I’m 100% wrong.
I’m also having a great year and planning for the slowdown in the near future.
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I know a traveling NICU respiratory therapist making $12,000 per month plus stipends.
They even have travelers for Central Sterile Processing department cause many hospitals can’t find people wanting to work. No hospital can do surgeries without their specialized trays being processed and ready to go.
The healthcare sector is really stressed right now. I have a close friend who works in a local system. A hospital near me with 350 beds had a patient census of over 500 when we spoke about a month ago. Throw in short staffing and the burnout is incredible. He said a lot of people are leaving.
I certainly don't think its a shambles, but this is an investment thread and were looking at forward indicators. The last big downturn actually started in 2006, yet people were partying like it was 1999 all the way until late 2008. So your anecdotes are noted, but there not particularly unexpected. The average guy on the street is always the last to know. There burning off their savings, and their "big raise" that's still below inflation.
Inflation is up - and core is sticky, employment is up, people are being let go in mass, housing on average has hit its inflection and has started to consistently decline in many markets - but not all, energy is up, there is a war in Europe, some countries are trying to move away from the dollar, were in a quasi trade war with China, several developing nations have defaulted on their debt, corporate earnings are under pressure. These are all economic indicators that tell me were at an inflection point.
Don't get me wrong - some people and some places will do well with this. I have seen this movie twice before and I hope to be one of them. But we have had 40 years of declining interest rates and declining inflation. That has now changed. Interest rates drive EVERYTHING - from consumer spending to employment to government spending to investment. Its an inflection point. I can't tell you where it goes, but I do think it will cause changes. Most people are paying zero attention.
Invest wisely.
Now...I'm not saying with all that is going on in the world this can't take a turn for the worse but the psychology of this is funny to me because I speak to people all the time who believe we are CURRENTLY in a really bad recession. They'll even go on and on about how bad it is RIGHT NOW and not just about inflation. They believe GDP IS down, unemployment IS high, businesses have closed left and right, the market is the worst it's been in decades and everyone lost all their money, and the general state of the economy is horrible.
When I say tell them the current objective facts they just say....ohhhh, well it's going to get bad. Ok, how bad? Which sectors? For how long?
I learned a long time ago I'm not a wizard and I can not predict the future. Do I think there will be some pain ahead? I do, but I have no objective idea how much and where and for how long and so I just keep to my investment plan.
Also, I heard the same stuff in 2008, and as I've stated before 2008 and 2009 weren't any different for me than 2005 or 2015. Some numbers on a computer screen went down BRIEFLY and then went way up for +10 years. The average recession in modern times is 10 months. Besides not being a wizard, I also learned long ago don't sweat the small stuff, especially the stuff that is out of your control. I can't control the economy and my investment plan already accounts for the possibility of recessions and so I stay the course just as I did in 2008 and life goes on.
IMO, if you have to regularly make large adjustments to your portfolio based on business cycles, you have the wrong portfolio.
My changes are mainly sells of poorer performing products as a tax hedge. Otherwise, I stay pretty pat.
Get off the roller coaster and let time work in your favor.
My changes are mainly sells of poorer performing products as a tax hedge. Otherwise, I stay pretty pat.
Get off the roller coaster and let time work in your favor.
OK, not saying your wrong - but this is a thread about investing strategies. If you have a 60/40 investing plan and stick to it - great for you.
But that isn't what most people here are interested in, and the point of the thread - so your to some degree off topic.
If you had figured out the big short in 2006, you wouldn't still be in your investing plan, you would have been retired. In fact, had you gotten out of the S&P in early 2008, which was in hindsight easy to see, you could have skipped the 48% down. I actually did. What I missed was the fast ride up.
I am trying to improve. If you had piled back into the market in 2020 like Pablo did, you would be retired. I actually tried, and did to an extent, but again I was too late, and again I am trying to learn from my mistakes.
If your not interested in specific investments then I can see why none of this computes to you.,
Exactly. Ain't got time for that. My portfolio is up 8.52% YTD and I invest in basically a few index funds. It can't get easier than that.
I'm not interested in specific investments but that doesn't mean I'm off-topic. So, since 2008 you have essentially tried to play this game of predicting the market and you lost during both opportunities. But, but, but...you know someone who "timed the market" just right, and if he/she can do it, so can you! That's called gambling. I just finished A Random Walk Down Wall Street and I've read The Psychology of Money, The Warren Buffett Way, The Intelligent Investor, How to Retire on Dividends, Principles by Ray Dalio, The Only Investment Guide You'll Ever Need, Rich Dad Poor Dad, The White Coat Investor Financial Boot Camp, and they all say, based on TONS of data, the same thing, what you're doing gambling and a fool's errand. More importantly, it is an unnecessary risk if you set up your investment plan the right way - I don't need to guess the market and make one big score - I just need to squirely away my $60K every year and let the market do what the market does.OK, not saying your wrong - but this is a thread about investing strategies. If you have a 60/40 investing plan and stick to it - great for you.
But that isn't what most people here are interested in, and the point of the thread - so your to some degree off topic.
If you had figured out the big short in 2006, you wouldn't still be in your investing plan, you would have been retired. In fact, had you gotten out of the S&P in early 2008, which was in hindsight easy to see, you could have skipped the 48% down. I actually did. What I missed was the fast ride up.
If you had piled back into the market in 2020 like Pablo did, you would be retired. I actually tried, and did to an extent, but again I was too late, and again I am trying to learn from my mistakes.
If your not interested in specific investments then I can see why none of this computes to you.,
That's important for anyone reading this thread to hear it.
No, I actually have had about 70% of my investments in company sponsored index funds and broad market ETF's in a couple different tax deferred retirement accounts. The other 30% I trade - and turn over at most half a year, and actually that portion has outperformed the latter for the past 20 years, just not by enough to retire - and that really isn't its purpose - my goal is to try to understand markets.
If this doesn't interest you - I get it. It doesn't interest most people - but again, why participate in this thread - to tell everyone how wrong they are and how smart you are?
By the way your wrong - Warren Buffet's own strategy is to buy companies at a discount, as he was taught by Benjamin Graham, and Ray Dalio made his money by trading volatility. They tell everyone else to buy and hold, which is fine, because that's probably what most people should do. Still not the concern of this thread.
No one here is telling anyone to bet everything on red 17. There sharing ideas for people to contemplate on their own.
If you think YOU can compete with Buffett, Graham, and Dalio you are delusional. Every single one of them has written a book that says you can't compete with me so stop trying - literally that is the take-home message from ALL THREE of them...lol.
Reminds me of a conversation I just had with SIL who works in private equity out of Boston. You have to minimally have $5M liquid (not in real estate) to even be a client. Then you "invest" and they buy up companies and keep the profitable ones and break up and sell the not-so-profitable ones. She has an MBA from Northeastern and her full-time job is to manage the department that writes checks to investors. They average a 20% return and she has days where she writes checks that total half a billion dollars. Awesome, right?! Well no, who the hell has $5M liquid and so this "opportunity" isn't available to 99% of people. Likewise, the opportunities available to Buffett and Dalio aren't available to most people and that's why they both wrote books that specifically advocate not doing what they do.
You are gambling, cool I get it, you like gambling, and I'm not trying to change your mind but you're not the only person reading this thread. My point is let's just call it what it is. Hopefully, anyone who thinks you're onto something will first go and read A Random Walk Down Wall Street, The Psychology of Money, The Warren Buffett Way, The Intelligent Investor, Principles, and The Only Investment Guide You'll Ever Need before they think they can beat the market. This isn't my idea - these are the conclusions of the men listed above.
Lastly, where is there a rule that only people who wish to gamble can participate? The title is, "Investing Strategies. What is your move?" I'm talking about investing and my move is to not guess the market. How's that not applicable?
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