Trying to decide if this is the right time to invest, the markets hit a trough, is like trying to bet when the market has peaked and you want to sell.  Both are basically attempting to "time" the market...which is a bet and usually doesnt work in the long run.  Dollar cost averaging on the other hand simply means if you have been investing $100 a month for the last 5 years, keep investing $100 a month regardless of where the market is.  Its a natural hedge, because you buy more shares when prices are low and cheap, and buy less shares when prices are high and expensive.       At the same time, there are always those strong companies that get hit because of the larger economic woes that are forcing down...if you can find those individual stocks, buy them.  But I wouldn't be buying into the "market" anytime soon.  The long-term is not always a safe bet with stocks. If you invest $1 into the Dow at certain points in the mid 60's, it would have taken to the early 80's, about 20 years, before that investment was worth a $1 again.  The last 20 years of market performance is certainly no indication of how the market perform for the next 20.  Of course, beyond I would expect a certain level of "normalcy" in the stock markets...if not then it doesnt matter where you put your money.

 p4jkafla wrote: 

 NoEnzLefttoSplit wrote: 
I can't. Off to my workout! Glad you enjoyed it though!

 kimyo wrote: 
No, I'm merely pointing out that to bet against long term corporate growth, and indeed world economic growth is a very silly, and uninformed bet.

just want to say I am enjoying lurking on this discussion.. keep it going!

 earthbased wrote: 
Nothing to be sorry about. If you're suggesting that planning to live longer is a bad strategy, then I really can't comment further. In 20+ years of being in the advisory business, I've never had a client come in and tell me that they wanted to draw down their money faster because they don't intend to live a long life. It would be considered malpractice to advise them to plan that way. Over a long time frame, outliving your money is by far the greater risk than losing it invested in equities

Yes, you did. It didn't make any sense then, and it still doesn't now.  You're welcome to your opinion, as I am mine.


The operative word in your statement is "hopefully". My mom is 78. She stopped working when she was 70. She just bought a brand new car. She figures that she'll have it for 10 years, and then she'll be ready for another. I call that hopeful!

 p4jkafla wrote: 
are you comparing the 70's to today? 

what is the basis for such a comparison?

 p4jkafla wrote: 
Sorry to inform you, but there is epidemic of obesity and diabetes in the USA.  Plus the increase of the statistical age of death is mostly because of infant mortality decreasing and at the tail end of life keeping more people alive with a serious disease for 1-3 years, where most of the health care cost increase is coming from.  I have already covered how to conservatively stay ahead of inflation .  But nothing is 100%.  Even though I am healthy and set financially for time being, I do not expect to retire and be a couch potato for 30+ years.  I will be making income until I die hopefully.

 earthbased wrote: 
But thats the thing. No one who is retiring within 10 years or even 5 has a time horizon that short. Even if you were retiring NOW, you'll have 30+ years of retirement, and you'll need to have an income stream that keeps pace with inflation during that time. At a 3.5% inflation rate, in 15 years, your purchasing power will be cut in half.

 p4jkafla wrote: 
I am talking about someone who will retire within 10 years, especially within 5 years.  If your horizon is longer, take more risk.  30+ years I would be 90% or more in a stock index fund or two stock index funds.

 OmegaConcern wrote: 
The problem is no one knows the high or the low.  So you are chasing a mirage.  If you are relatively young now and don't want to research stocks, then stick your money into an index fund that models S&P500 (these companies already have lot of international exposure) and invest monthly amount to dollar cost average (you will buy more on the low).

 earthbased wrote: 
Meh...

I've never subscribed to the belief that the stock market investing is a bet.

I would argue that if you're nearing retirement, you'll need to have your capital working for you for 30 plus years. In the 70's, during the Nixon/Carter administrations, the Dow was trading between 600 and 1000. Today, after a year long bear market, the Dow remains above 11,000 (including todays rebound)

Which side of the bet would you have liked to have been on back then?

 p4jkafla wrote: 
Everyone knows "buy low, sell high!", but when things start tanking, the first thing they do is dump dump dump rather than buy buy buy...which is basically "buy high, sell low, lose mo' money".

 OmegaConcern wrote: 
I never know how deep to plant them.

 Curry wrote: 

-11.23%.  Sucks, but what can you do?  I don't think the blip will hold steadily for a while.  I actually expect I'll lose more value in the near future (6-12 months), but will keep buying as much as I can as it dips in the hopes that there will be a nice stockpile when things pick back up.

Then it's Alpaca farm time...

And a to you smarties that know enough to talk about this stuff.

I guess the lesson being "never trust authority."  I never have although I will listen to it to decide for myself after digesting other information the authorities usually don't mention.  So why trust the government now?  You have to trust yourself and constantly learn.

 hippiechick wrote: 
No, the baby boomers are the biggest voting block and they will vote their self-interest.  The big bunch of poor people will be your children who are up to 15 years old right now.

 p4jkafla wrote: 
What if the S&P500 drops 300-400 points and then doesn't recover for over 10 years?  Non-financial corporate bonds are a good hedge against inflation right now.  Or Treasury Inflation-Protected Securities (TIPS).  If you are nearing retirement, you need to protect capital not bet it (stock is a bet in the short term).  Good luck to all you.