View Poll Results: How would you change your investment allocation?
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I'd take on more risk (perhaps because I could)
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10 |
12.35% |
I'd leave my allocation the same
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34 |
41.98% |
I'd take on less risk (perhaps because I don't need risk any more)
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37 |
45.68% |
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06-03-2009, 07:44 PM
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#21
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
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Is SC521 having this thread to see forum members' personalities through their risk tolerance level?
I voted "Keep the same". If it has been working, why change it? Sure, it is riskier. True, you may not need the extra dough, but you also have plenty of margin in case it doesn't work out. The lower-risk AA may be boring to me.
No, I am not full of hormones.
I do not drive fast cars, in fact not even interested in them. No thrill seeker here either. I also do not watch spectator sports as I find them boring. I find the market an interesting subject, and you've got to have a stake in it in order to appreciate it and to pay attention.
__________________
"Old age is the most unexpected of all things that happen to a man" -- Leon Trotsky (1879-1940)
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
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06-05-2009, 10:10 PM
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#22
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2006
Location: Boise
Posts: 7,882
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Actually, I have a very complicated and extremely detailed spreadsheet ( ) that I wrote myself, and the last error I found in it was just a few days ago, but the error was not in my favor. I was using a discount rate to compute an NPV, and while the context of the calculation implied a monthly discount rate, I was using an annual discount rate. Unfortunately, the NPV in question is of a liability, so the larger discount rate was making the amount smaller than it needed to be. Whoops. Fixed now :-).
2Cor521
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
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06-05-2009, 10:11 PM
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#23
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2006
Location: Boise
Posts: 7,882
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Quote:
Nope. But there's a modest possibility that a scenario like it might in about 5 years.
2Cor521
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
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06-05-2009, 10:43 PM
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#24
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2007
Location: New Orleans
Posts: 47,500
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Quote:
Originally Posted by SecondCor521
Nope. But there's a modest possibility that a scenario like it might in about 5 years.
2Cor521
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In the modestly possible scenario that something like this happens in about 5 years, I would recommend putting the money that you didn't know you would have into a money market account for about six months before you do anything with it. People say that it is usually not best to make major decisions right after major things happen in life, and I agree with that too. So, at least at first you would have a more conservative AA due to it all being in MM. Don't buy a new house or other major purchase right away until you have settled down for a few months. During that time, you can work hard on fleshing out the details of your new investment plan, and working on any emotional or interpersonal issues that the money brings with it. Ultimately I suspect you will find that the money doesn't really change your lifestyle, so much as easing it a little and making it more worry-free.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities. - - H. Melville, 1851.
Happily retired since 2009, at age 61. Best years of my life by far!
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06-06-2009, 12:22 AM
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#25
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2006
Posts: 11,401
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I voted to reduce risk. If I were in that position, my prime concern would be preservation of capital.
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06-06-2009, 02:48 PM
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#26
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2006
Location: Boise
Posts: 7,882
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Quote:
Originally Posted by Want2retire
In the modestly possible scenario that something like this happens in about 5 years, I would recommend putting the money that you didn't know you would have into a money market account for about six months before you do anything with it. People say that it is usually not best to make major decisions right after major things happen in life, and I agree with that too. So, at least at first you would have a more conservative AA due to it all being in MM. Don't buy a new house or other major purchase right away until you have settled down for a few months. During that time, you can work hard on fleshing out the details of your new investment plan, and working on any emotional or interpersonal issues that the money brings with it. Ultimately I suspect you will find that the money doesn't really change your lifestyle, so much as easing it a little and making it more worry-free.
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W2R,
Thanks, yes, that is my tentative plan.
2Cor521
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
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06-06-2009, 02:57 PM
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#27
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Administrator
Join Date: Jul 2005
Location: N. Yorkshire
Posts: 34,126
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Quote:
Originally Posted by FIREdreamer
I like the concept of "marginal utility of wealth" as described by Swedroe in one of his book. Basically, once you have accumulated enough to cover your needs, any incremental increase in wealth becomes less and less significant. Therefore the need to take risk decreases. The hard part is figuring out when enough is enough...
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Totally agree. Was it not Gaucho Marks (who had all his wealth in CD's) that was asked the question "Do you think CD's are a good hedge against inflation?"
His reply was "Yes, if you have enough of them!"
__________________
Retired in Jan, 2010 at 55, moved to England in May 2016
Enough private pension and SS income to cover all needs
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06-06-2009, 03:05 PM
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#28
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,021
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Quote:
Originally Posted by Alan
Totally agree. Was it not Gaucho Marks (who had all his wealth in CD's) that was asked the question "Do you think CD's are a good hedge against inflation?"
His reply was "Yes, if you have enough of them!"
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I believe it was Treasuries, not CD's...and I also am pretty sure it was Groucho Marx, not a South American cowboy with a similar last name.
__________________
Numbers is hard
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06-06-2009, 03:07 PM
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#29
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Administrator
Join Date: Jul 2005
Location: N. Yorkshire
Posts: 34,126
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Thanks for correcting me - heavens knows what I'll be like be in 20 years.
__________________
Retired in Jan, 2010 at 55, moved to England in May 2016
Enough private pension and SS income to cover all needs
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06-06-2009, 03:28 PM
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#30
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2003
Location: Hooverville
Posts: 22,983
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Quote:
Originally Posted by SecondCor521
Imagine the following hypothetical scenario:
You have been saving diligently for retirement for many years and are now 49 years old. You've done the calculations and they show you are on track to retire and meet your financial goals at age 50, which is just dandy fine with you because age 50 meshes well with your life plans.
One day, you look at your calculations and realize that they are off by a factor of two to your benefit: instead of being able to retire at 50 with $X million, you'll be able to retire at age 50 with $2X million.
Setting aside the question of whether or not to retire immediately, the question I wonder about is this:
How would you change your investment allocation after having this realization?
2Cor521
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I would decide to keep working, as I clearly lacked the basic cognitive skills to survive without a paycheck.
Ha
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"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
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06-06-2009, 04:07 PM
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#31
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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Groucho Marx? What does a crotchety, grumpy Communist have to do with any of this?
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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06-06-2009, 04:15 PM
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#32
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Administrator
Join Date: Jul 2005
Location: N. Yorkshire
Posts: 34,126
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Quote:
Originally Posted by ziggy29
Groucho Marx? What does a crotchety, grumpy Communist have to do with any of this?
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I believe the communists (ie China) hold about $3 trillion worth of US treasuries today so they are still doing it
__________________
Retired in Jan, 2010 at 55, moved to England in May 2016
Enough private pension and SS income to cover all needs
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06-06-2009, 04:33 PM
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#33
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Dryer sheet aficionado
Join Date: Jan 2009
Posts: 44
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Quote:
Originally Posted by FIREdreamer
I like the concept of "marginal utility of wealth" as described by Swedroe in one of his book. Basically, once you have accumulated enough to cover your needs, any incremental increase in wealth becomes less and less significant. Therefore the need to take risk decreases. The hard part is figuring out when enough is enough...
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For some, money is just a way of keeping score ( though I suspect not too many of them frequent the FIRE Board ). The accumulation of money, love conquest, wardrobes, cars, private jets is more a primal thing and not based on utility and need. To them, the term excess does not exist.
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06-08-2009, 03:19 PM
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#34
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2008
Posts: 35,712
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Here are some wisecracks from good ole Groucho Marx.
I wish you'd keep my hands to yourself.
Women should be obscene and not heard.
A man's only as old as the woman he feels.
Anyone who says he can see through women is missing a lot.
We took pictures of the native girls, but they weren't developed. . . But we're going back next year.
How do you feel about women's rights ? I like either side of them.
Whoever called it necking was a poor judge of anatomy.
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