TheRumpledOne
6,411 posts
msg #68695
- Ignore TheRumpledOne |
10/23/2008 12:21:35 AM
10 Steps to Retire a Millionaire
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maxreturn
745 posts
msg #68708
- Ignore maxreturn |
10/23/2008 10:17:45 AM
Very nice TRO. I printed out a couple of copies for my kids. Thanks for sharing.
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slotmarket
59 posts
msg #68724
- Ignore slotmarket |
10/23/2008 8:18:49 PM
Can not agree with step 7, check your portfolio once a year. Take a peek now and find 40% gone will not make you a millionaire.
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rharmelink
81 posts
msg #68770
- Ignore rharmelink |
10/24/2008 10:32:36 PM
> Can not agree with step 7, check your portfolio once a year. Take a peek now and find
> 40% gone will not make you a millionaire.
That's the point -- it still will, as long as you followed step 2 (START saving) as early and as often as possible . I've stayed invested through several such declines. That 40% decline followed a run-up of almost 100% in a short time. Such a swing down is to be expected (sooner or later) after such a quick swing up. The pendulum swings back and forth. The problem is knowing WHEN the swing will occur, unless you just ignore them altogether.
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slotmarket
59 posts
msg #68775
- Ignore slotmarket |
10/25/2008 3:53:52 AM
rharmelink
Let's say you started investing in the slotmarket five years ago. Today all the gains made since have been wiped out. You think I'll be able to convince you that buy and hope is the way? I don't think so. But if you do think so, then I got a bridge to sell you too.
This is heading toward the arguement between buy and hope versus market timing. TRO please let me know if you don't want us to hijack your thread and to start a fresh one.
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luc1grunt
622 posts
msg #68784
- Ignore luc1grunt |
10/25/2008 5:52:26 PM
pay yourself first...that is where it all starts.
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rharmelink
81 posts
msg #68788
- Ignore rharmelink |
10/25/2008 8:52:28 PM
slotmarket -- "Retirement" can be a 45-year plan, of which 5 years is very little. Note that step 10 is "Patience".
I'm not a millionaire, but I did retire a few years ago at the age of 49. Plus, I only worked part-time from 1993-2006. When I retired, I was only working 20 hours per week. Most of my co-workers, who were working full time (or more), always complained about living paycheck to paycheck.
But I did step 1 ("Set the Goal") when and step 2 ("Start Saving") when I was 21. In 1993, when I was given the choice of working part-time, I had to make the choice between retiring earlier or enjoying life more while I was young. Of course, my idea of enjoying life is much different than most people. I enjoy a lot of low-cost activities (step 6) -- reading, movies, computers, TV, etc. I haven't even owned a car since 1984.
But I've also kept track of my expenses since I took a bookkeeping class in high school. So I've always been aware of my cash flow and budgets. I even have computer expense records going back to 1983. OCD?
To me step 6 is a big one -- learning to live below your means. Both debt and savings can compound at an exponential rate. Compounding is a strong effect -- I'd rather have it working for me than against me. Even at 20 hours per week, the equivalent of 70% of my net income was going into savings.
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TheRumpledOne
6,411 posts
msg #68789
- Ignore TheRumpledOne |
10/25/2008 10:25:40 PM
HiJack "my" thread? LOL!
Feel free to post.
I just thought someone might find the article useful.
Healthy, spirited debate is always welcome.
Let's just not stoop to the level of you know who.
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slotmarket
59 posts
msg #68798
- Ignore slotmarket
modified |
10/26/2008 12:26:07 AM
I don't have any problems with the other nine steps, they're all fine and good.
Well, let me clarify now that I have TRO's blessing. I think most of us have been brainwashed into thinking that the best and only way to grow your long term investment in the slotmarket in to buy and hope, that you'll never be able to time the market so just forget about it. The most popular argument is that if you try to time the market you'll miss out on the large gains at the start of bull markets. My two cents on that is, why don't they ever talk about the other side of that argument? What if you had missed out on the humongous losses of all the bear markets? From the studies that I've seen, avoiding the bear is more advantageous for your portfolio than missing the bull.
Let's look at the last two vicious bears, 2000 and the current nightmare on wall street. Using something as simple and unsophisticated as the 50 dma 200 dma crossover as your timing signal you be a happy camper right now. Go to some free charting site like yahoo finance and bring up the SP500 chart of the last ten years with those two moving averages and you'll see that you would not have miss out on much of the last bull market from the spring of 2003 and that you would've gotten out by the first day of this year. And it would've gotten you out of the 2000 bear also. You do that math and see how much ahead of buy and hope you'll be timing the market the last ten years.
Of course there is a catch, isn't there always. That is in the implementation.
For the record all my IRA's have been in cash well before the start of this year.
I'm heading up to Tahoe in a few hours and won't be able to respond until Tuesday evening but I'm sure this will get things rolling.
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TheRumpledOne
6,411 posts
msg #68808
- Ignore TheRumpledOne |
10/26/2008 2:26:54 PM
Thanks for sharing.
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