patrick.net

I'm thinking the same thing.

I'm looking at my 403b and 457 funds and the real laggards are my Vanguard Global Cycles (née Precious Metals) and Inflation Protected (why the fuck did I put into this for so long?)

I never liked mutual funds at all, because they have to make money at my expense. I just pick enough stocks in different industries that my total performance approximates the S&P 500. Even did slightly better than that because of a few lucky picks.

VFIAX=Vanguard 500 Index Fund (Admiral shares) expense ratio is extremely low; 0.04%

This is $4 for a $10,000 investment, $40 for $100,000 investment.

True, Vanguard is the best of them. But I'm too cheap to pay even them, lol.

I don't see the need. Picking stocks on my own and holding long-term has worked out well for me.

I think the key is to hold long-term, first for the lower tax rate, and second because it's impossible to predict stock movements without Pelosi levels of insider info, and using such info is criminal for people like us. Pelosi gets to do it though because... why?

I never got into Mutual Funds…Check out CEFs

Another thing happened today to illustrate why making changes in the funds can be counter-productive; the NASDAQ just went up a shit load and I recently got out of those things and into large capitalization and dividend stocks.
Moral: don't just do something, stand there.

Isn't there a fund that tracks with Pelosi's picks? Also, there is an Anti-Cramer fund, which has been hilariously profitable.

Basic rule of thumb is that when you throw your lot in with gamblers, you will hear a lot of success stories but no failure stories because gamblers are both superstitious and self-duplicitous. Nobody wants to look like a loser. Brokers live on 'hot tips' to harvest suckers. There was one broker who also engaged in car insurance scams in Pleasanton and got caught..

I have a friend who did the day trading gambling and had investment networks with his Church. I told him never to invest on margin. He invested on margin and told me he lost 250,000 on a single roll in the days when that is probably 700,000 or 800,000 now.

He eventually left California because all he had left was his home equity, so he married an old flame from Mississippi and sold his house to live with her in her inherited home by the Pearl River.

I leave my index mutual fund piles alone and don't presume I'm entitled to anything but letting the boat rise and fall with the unmanageable tides. It has averaged about 8.5 percent a year compounded over the last ten years without me touching it.

It will be interesting to see if the pile evaporates with currency collapse of the fiat dollar. I also don't participate in the tulip bulb manias over metals and crypto. Crypto is digital fiat, it's all imaginary if you can't buy groceries with it.

Ceffer says

It will be interesting to see if the pile evaporates with currency collapse of the fiat dollar.

Vanguard LifeStrategy Conservative Growth Fund has earned about 6.7% annually since September 1994. This is a 60/40 fund.

The compound annual growth rate (CAGR) of U.S. inflation from September 1994 to September 2025 is approximately 2.56%. This reflects the average annual increase in consumer prices over a 31-year period, based on the Consumer Price Index (CPI).

I figure a more conservative 70/30 fund would earn 5.5% a year and a real annual return of 3%.

Again this is based on the status quo of 2 to 3% annual inflation.

Notice when annual inflation rose to around 8.75% in 2022 that the Vanguard Total Stock Market Index Fund consequently dropped around 26% over 16 months.
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I used to try to read the gurus writing investment books. Strange thing is, for those who kept up, a lot of them from the late 80's and 90's wound up bankrupt on their own advices. Of course, nobody remembers that stuff. They look at the stochastic 'winners' and work backwards, which has been shown to be a reliable losing strategy. Also, nobody knows the extent to which the 'winners' were always propped up by fraud or insider dealing or assertion fallacy.

I had another epiphany about converting an IRA to a Roth IRA; not converting may work out the same as converting, but you are assuming tax rates stay low in the future. If I convert today, that money is taxed at a known rate, while the tax rate on my IRA in the future is unknown. I wonder how long tax rates will stay like today with the gigantic deficits.

Vanguard says my investments have risen an average of 14% per year over the last ten years; this seems too large to me.

My friend told me today his son has about $100,000 worth of silver; I'm a little annoyed he brainwashed his son into buying "precious metals" which are speculation and not a true investment. He has always liked shit like gold and silver, and I sometimes called him "Goldfinger" to tease him. He's very "underwater" with a bunch of silver he bought at a high price over 10 years ago.

People are very particular about their beliefs and behavior concerning money; it's like talking about religion or politics.

Roth IRAs work on the presumption that future tax rates will be higher than when you put the money in. Lower tax rates in the future make them possibly a worse investment than standard IRA.

You are gambling on both the notion that future taxes will be higher, and the actuarial likelihood that you will be alive and uncrumbled enough to enjoy it.

Ahh yes, the rentier class. You've worked hard your whole life, so what is wrong with that?

Bonds have been a loser vs. 100% equities my entire adult life. They are supposed to protect you in the event of run away inflation but even TIPS provide no real return (a return above the risk free and/or inflation rate) over the course of a retirement period.

That's why I am 95% equities with a multi-year emergency fund in Money Markets. I don't know of a better way of keeping even with inflation than U.S. equities - because intuitively companies have pricing power.

Gold's doing great right now but I believe it will revert to the mean - losing to almost all other options over the course of my retirement period. I feel the same about Bitcoin. The other problem with both is that your transaction costs eat up 10% of your speculation. (Here I can put a quick plug for BullionVault.com - I used them in the last Gold run up and had no problems and they offered the lowest premium to spot that I've ever found - and it's physical metal stored in a vault of your choice)

And yes I am part of the rentier class without ever having made a top 10% income. It's because I married well and we have saved in excess of 25% of our income for 30 years invested in index ETF's with low ER's. That's one formula for financial security. Fuck your new cars every 3 years, your annual $10,000 vacation, the $10,000 you spend on Christmas presents, the fancy eat out dinners 5 times a month, the home you have to stretch to afford.

I don't like the folks over at Bogleheads (in fact I'm doing a pretty good job at getting kicked off the forum there) but they really do provide great resources backed by an extreme amount of data. For the 99.9% of us who will never identify the next 1998 Amazon it is a great source of advice.

I'm retired and 94% stocks.

I'm confident that tax rates will rise in the future, but still don't know how I'm going to spend the money.

A strange thing can happen which happened to me; I planned my retirement and then stocks rose another 100%.

clambo says

I'm retired and 94% stocks.

I'm confident that tax rates will rise in the future, but still don't know how I'm going to spend the money.

A strange thing can happen which happened to me; I planned my retirement and then stocks rose another 100%.

That strange thing is called inflation.

Eventually, at the great reset, virtually all assets in banks, savings accounts, retirement accounts or stocks will be wiped out or paid out in a new currency for “pennies on the dollar”. It might be 50 or 100 hundred years, or it might be in our lifetime, but the dollar will fail and with it most of private citizens “wealth” and savings.

clambo says

still don't know how I'm going to spend the money.

Well if you need the help, let me know! Seriously. Why not have some fun with PeopleUnited? I know where I would like to retire.

stfu says

we have saved in excess of 25% of our income for 30 years invested in index ETF's with low ER's. That's one formula for financial security. Fuck your new cars every 3 years, your annual $10,000 vacation, the $10,000 you spend on Christmas presents, the fancy eat out dinners 5 times a month, the home you have to stretch to afford.

That's pretty much us as well, only I just bought low p/e stocks which pay a dividend (with some exceptions).

I'm blessed with a cheapskate wife too. That helps a lot.

PeopleUnited says

Eventually, at the great reset, virtually all assets in banks, savings accounts, retirement accounts or stocks will be wiped out or paid out in a new currency for “pennies on the dollar”. It might be 50 or 100 hundred years, or it might be in our lifetime, but the dollar will fail and with it most of private citizens “wealth” and savings.

I see less drastic measures like a means test for Social Security such as those with income greater than 4 times the poverty limit receive at most 75% of their original Social Security. Those that make 6 times the limit or more will receive no more than 50%.

Also they'll partially reform entitlements and welfare programs including Veteran Affairs disability, if they agree on small tax increases such as those within the top 25% to 5% bracket pay 10% more in income tax and those in top 5% end up paying 20% more in income tax for increases that sunset within 5 years.

I look at how dire the circumstances were which led to the Democrats compromising in Congress to reopen government. That tells me there very likely will be some compromise to notably reduce the federal debt load.

PeopleUnited says

Eventually, at the great reset,

In addition to Social Security means test, income tax increase, etc. , likely they will continue with inflating out of a debt crisis so expect a long-term annual inflation rate between 2.5 to 3%.

This is why the economy demands steady increases in productivity in order to compensate for or offset this.
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clambo says

I'm confident that tax rates will rise in the future, but still don't know how I'm going to spend the money.

You better stop talking like that, or Patnet members will be showing up on your doorstep with wigs and falsies.

Ceffer says

Patnet members will be showing up on your doorstep with wigs and falsies.

That was you?

AD says

I see less drastic measures like a means test for Social Security such as those with income greater than 4 times the poverty limit receive at most 75% of their original Social Security. Those that make 6 times the limit or more will receive no more than 50%.

Just include SS payments as taxable with the income tax.

Patrick says

bought low p/e stocks which pay a dividend

The problem with dividend stocks is that you are forced to take income evey year. That means you get no ObamaCare subsidies, energy subsidies, etc. My ObamaCare Bronze (lowest level) goes up to $902 for year 2026. Would love the taxpayers to pay for half of it.

SunnyvaleCA says

My ObamaCare Bronze (lowest level) goes up to $902 for year 2026.

$902 per year? Or did you mean goes up $902, as in increased by $902?

HeadSet says

SunnyvaleCA says

My ObamaCare Bronze (lowest level) goes up to $902 for year 2026.

$902 per year? Or did you mean goes up $902, as in increased by $902?

I'm betting that his monthly cost goes to $902.

SunnyvaleCA says

The problem with dividend stocks is that you are forced to take income evey year.

Most of my dividends are in tax-deferred accounts like a 401k rollover and Roth. And I sign up for immediate dividend reinvestment (DRIP) as a rule so I don't accumulate idle cash.

I guess it sounds like of crazy to get money from a company and immediately reinvest it instead of just letting the company keep it, but I think paying out dividends is a proof that the company is working for the shareholders. It lets me choose what to do with the company earnings rather than just the company itself.

Dividends reinvested in more shares compound pretty well in a retirement account.

Factoids about stuff I see mentioned above herewith:

Bitcoin, crypto, gold, silver, platinum, palladium, are not investments; they are something you speculate with.
They pay no interest, dividends, and can't grow like a stock can; my shares of AAPL have split many times so now I have thousands of shares, while my friend has the same number of silver coins in his home safe as he did 15 years ago.

Bonds over long time periods don't appreciate capital; your return is just the interest they pay you.
Sometimes bonds can appreciate, and years later they can depreciate; the long term result is neither.

Vanguard suggesting you own a lot of bonds is just what is safer than being subjected to the swings in the stock market; if you dislike the swings down, buy some bond funds or a balanced fund, e.g. Wellington.

Personally I'm not scared of "draw downs" or "melt downs" or other shit that they call it.

clambo says

Bitcoin, crypto, gold, silver, platinum, palladium, are not investments; they are something you speculate with.

They are alternative investments (or alt investments), and even JP Morgan has said to invest in them as a hedge. I say put up to 20% in them if that cautious of an investor or saver.

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