What are the Core Principles of Not Investing?
What are the Core Principles of Not Investing?
Florida1, we have followed those good rules of investing through the years. Thanks for laying them out again. My question now with the growing probability of pandemic is...
What's the alternative to investing? After you have your food preps and cash and a bit of gold/silver coins...
What about sitting out the pandemic financially... cashing out of stocks? Where do you put your money? Every choice has financial implications... If you have more than $100,000, what about putting your $$ from cashing out in a number of bank accounts so as not to exceed the FDIC insured limit on any one? (Joe Kennedy pulled out of the Stock Market prior to the 1929 crash and the Kennedy family fortune survived.) Of course, cashing out generates a potential tax burden, if your stocks have increased in value.
This is a different kind of question than asked by those who know how to invest in the stock market in ways other than buying good stocks when they're low (or buying on a fixed schedule over time, catching the lows and highs) and holding them and selling when they're worth more. For the inexperienced, we have lots of questions...
(DISCLAIMER: I know you can't and won't "give advice". But what are some of the parameters of the playing field, er, investing field? (GR, FL1, Brinkerbear, can you pretend you're in "Econ and the Pandemic 100" or "Investing in the Face of Pandemic for Dummies" or "Hedging your Investments 101" or "Alternatives for Retirement Investing for those with Oldtimers Disorder" and tell us what must be considered?) I had to really work at understanding what questions to even ask our TSA rep to get at what options might be available and the pros and cons. Problem with most of these people is they are not dis-interested advisors. They may not want to offer you some options if it impacts their bottom line.)
Retirement funds?
Seems like there are relatively few options there, but you can sometimes choose to move your retirement funds into a more conservative "value" fund option from "growth". Most financial advisors who are not tuned in to the bird flu are suggesting that "growth" is now the way to go, that the market looks good for "growth"... They pull out their charts to convince you, showing patterns that have existed in the past... So you have to do a little explaining first... This is not about patterns that we have any experience with, in my opinion. I'd rather be financially conservative... if I can figure out what financially conservative is. (I lack experience with any investment other than my bit of knowledge of investing in stocks. People tell me I know more than I think, but from my perspective I don't...)
So what is most conservative for, say, a Tax Sheltered Annuity? we asked the Valic rep... with very little work (phone call or web) we can move those investments into another category that may be far less risky than stocks, ie, to the Short-Term Fixed Account (3% interest rate), but it must stay there for a 90 day minimum. Longer is an option too. The rep we talked with said he's had some people move their investment there, at the drop of a hat; and they've left it there for some time until they feel safe investing in stocks again. No financial penalty or charge for making such a move. It's all done within the TSA.
We also have retirement funds managed by a state retirement system. Apparently there is very little control over how those funds are managed or invested. I still need to do more research on that one.
If money is taken out of retirement funds "before their time" (based on your age, I think), you pay taxes and penalty. One question is... if a person is old enough to escape a penalty on cashing out of some of those accounts, should they bite the bullet on taxes? Is there any other consideration besides taxes and penalty?
I heard that one person (not American) "borrowed against their retirement fund". Anyone know if that is possible in the US and what would be the pros and cons? Does it have to be paid back?
These are just some of the many questions I have.
