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Started by FIREDad, November 09, 2018, 12:21:11 PM
Quote from: thlayli on December 14, 2018, 12:29:16 PMWhy are people always hesitant to buy stocks, or invest in index funds, after a week of bad numbers on Wall Street? It always baffles me that people see a 3-5% decline over a short period of time and go, "Nope. I'm out. Going to hold my money until things rebound." I swear, it's the only thing people don't want to buy on sale. Anything else out there you were willing to buy today, and tomorrow it gets a 3-5% discount, you'd be stoked and happy you are getting a deal. I'd say simple advice, stop trying to time the market. It's cliche, but you're never going to be able to time it correctly, and the few times you do get lucky will be offset by all the other missed opportunities where you chase market rises like the rest of the lemmings. Just set a level you're comfortable investing each paycheck, and maybe cut a little deeper if you can, and try to max out your contributions each year. You'll be very happy you did in a decade. I saw my 401K go from a nice $100K to $700K in the last decade doing nothing but staying the course. In another decade, I'm expecting similar returns in the long run. My friends that balked in 2008, sold, or stopped investing for fear they were going to lose money, ended up much lower than me, as I stayed the course. Also, if it helps, try and disassociate the money value from the shares. If you buy 100 shares of a stock or index fund, and it goes down 10%, you still have 100 shares. You can even buy 110 shares for that same price now. Once you start thinking in volume, and not price, the small movements year to year don't matter as much. There will always be a downturn around the corner, maybe it's next year, maybe it's in three or five, but no matter where you are there is a shake up brewing. These are long term investments, though, especially 401K, and money you likely won't touch for 20, 30, maybe even 40 years. Don't worry about a bad year here or there, as the good ones will more than make up the difference... and just keep investing slow and steady.
Quote from: Sam on November 09, 2018, 06:48:38 PMHard to give advice without knowing what your after-tax investment amounts are and your overall net worth picture. I really think it is good to max out your 401(k). In 10 years you'll be glad you did.