What Age Did You Put $ in a Retirement Acct?

[Vanadium 50]

Median annual household income is $45,000.

 

[russ_watters]

Median annual household income is $45,000.

$59,000... but individual looks about right at $30,000. Average household is 2 working age people and most of a kid.

 

[kyphysics]

$59,000... but individual looks about right at $30,000. Average household is 2 working age people and most of a kid.

Sounds like a good reason to get married!

Seriously, though, is it just me or do couples seem to get better tax breaks and "economic benefits" if you have two working people?

 

[Vanadium 50]

It's just you. Typically married couples with similar income pay a tax penalty, especially if they have children.

 

[russ_watters]

Sounds like a good reason to get married!

Probably the best situation is owning your home and having a [non-spouse] roommate who pays you rent.

 

[Vanadium 50]

Most people really don't know this, or else they've been convinced that their fund has some "special sauce" that makes it better than the average actively-managed fund.

To complicate things, there usually is a special sauce. Just not one that is always worth buying.

There are plenty of funds that beat the S&P 500. Even over a long period. The problem is that typically they have a very high expense ratio. Is buying advice on how to get 11% return instead of 10% return worth 1% of those assets? Not really.

There are still some funds that "win" - Fidelity Blue Chip Growth, for example, largely because it has a relatively low expense ratio for managed funds. Is this a better deal? Well, maybe. It has higher returns, but it also has higher risk. If you are willing to accept this additional risk, this can be accomplished by putting some of your money into funds that track asset classes with higher return but more risk: small cap funds and sector funds. This can often be accomplished without blowing up the expense ratio.

 

[jtbell]

If you are willing to accept this additional risk, this can be accomplished by putting some of your money into funds that track asset classes with higher return but more risk: small cap funds and sector funds.

Or, if you're not 100% invested in stocks, bur instead, have some fraction in fixed-income investments (bond funds or CDs or whatever), shift some of your fixed-income to stocks, e.g. go from 60% stocks to 70% stocks.

 

[CWatters]

It's also worth investing through a platform that refunds or discounts some of the costs.

Personally bit wary of fixed income investments at the moment because interest rates are low (so not great returns) and if interest rates rise there is a risk to capital.

I'm in the UK and my main regret this year was not investing in the USA. I've still managed to do better than the Dow but not the Nasdaq.

 

[Vanadium 50]

shift some of your fixed-income to stocks, e.g. go from 60% stocks to 70% stocks.

That's right. There are many ways of adjusting risk.

I would argue that the right way to invest is to set up a level of risk you are comfortable with, the purchase assets designed to maximize the (after taxes and fees) return within this level of risk. This has driven me to a small set of index funds, and a handful of single stocks. My overall IRR is 9.6% over the last 12 years, compared to 8.6% for the S&P 500, so I don't feel I am leaving money on the table with this strategy.

My strategy is not (unlike some people's) to "strike it rich".

 

[Michael Price]

I'm in the UK and my main regret this year was not investing in the USA. I've still managed to do better than the Dow but not the Nasdaq.

I'm also in the UK and have invested heavily in US tech stocks. The technology for reasons already discussed, and the US because Europe mostly does not 'get' capitalism and the Asia is very corrupt. Regards timing entry into the US stocks, now might not be so bad. Trump seems to be do doing his best to make US stocks affordable again.

 

[fresh_42]

I don't think it makes much sense to reopen a discussion from 2 years ago.

The subject might be interesting, but there hasn't much changed within the last two years, considering interest policies. If someone wants to discuss this further, please create a new thread - and leave politics off the table as far as possible, although I admit that this is basically impossible as politics defines the framework for economic decisions.

This thread is closed.