Old School
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Posts posted by Old School
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First, I am not a PhD in finance.
Second, I do not think, nor do I think I have suggested, that a high level of national debt is healthy or desirable.
I am having trouble with the idea that a good, prudent way for individuals to manage their money is to hold a portfolio that contains bonds, which represents the borrowing of the government. If it is not good, or healthy for the government to borrow so much (which is part of what I have thought you have been saying), why is it prudent for an investor to lend money to the government (which is what I am doing when I buy a government bond as in the portfolio you suggest)?
I didn’t suggest it. Ray Dalio spelled it out in his all weather portfolio back in 2014. You can google it.
He’s had great success and is worth about $14Billion and manages about $150Billion. He suggests a balanced asset allocation which you can find if you google it.
I’m not selling anything other than suggesting some might want to look at it. It’s worked pretty well for his clients with minimum assets of $100Million. He must know a few things about money management was all I have been saying about the man.
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Where did she ever say these were good? I missed it.
All she is saying (more or less) is that if everyone tries to earn a living off investing, it won't work. There are two parts to investors. There are those who have money to lend and those who want to borrow it.
Buying stock is buying part of a business because the owner either needs some cash or wants to sell parts (or all) of what he has to get that money. They have your money to work with and you get a part of the proceeds as well as owning a share (or however many shares). If the company tanks, you lose. You can lose ALL you invest. It's risky, some less so than others.
The Phd is totally 100% wrong if she is saying if everyone invests long the markets in say the SPY or VTSAX that it won’t work. Do what?
VTSAX and SPY have never gone broke. If SPY goes broke we are all broke, back to the Stone Age.
If everyone bought stocks and had zero debt the only people who would lose money are lenders who screw people who don’t have enough to pay cash. I think there are plenty of people who will always create debt by borrowing and financing to make the banks richer.
So I’m dying to here from a PhD exactly how to many people buying stocks or proper balanced asset allocations is a bad thing.
Buying VTSAX type instruments over long periods of time beats the majority of all actively managed funds btw. Most fund managers can’t beat the SPX over time. Low cost index funds like the VTSAX are pretty safe investments long term because our markets history since it’s birth has averaged 7 to 10%. 7% if you account for inflation but not included here is the power of dividends.
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How does saving, investing wisely with the power of compounding over time, living without debt, and wanting our nation’s kids to become more educated as well as adults twisted around in a thousand different directions here in this forum?
It’s an equation.
To much debt on all levels+ not enough savings and investing properly+not enough education and planning and working the plan to fix a nation with too much debt=a catastrophic disaster if it’s not fixed with education then what?
It’s pretty simple. Educate.
That or we live through another Greater Great Depression.
If we as a nation don’t fix what’s broke by more education then how do the PhDs here propose we try to fix it?
Please don’t tell me just print more money from thin air to keep the markets propped up globally like all Central Banks have done. Not when our FED is starting its unwinding.
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I am trying to convey that our countries ever increasing debt burden that now exceeds our GDP is not healthy. You are the PhD, tell me how a nation which has no control at all over its own sky rocketing spending and debt level is a healthy thing. Tell me from your professional education howI am having a problem seeing how this works at the country level. The only way someone has debt is if someone else lends them the money (and earns a return). The only way someone invests and earns a return is by letting someone else use the money--the person I am letting use my money is borrowing.
So, if you argue that, as a society, we should borrow less, you are also arguing that, as a society, we should have fewer investment opportunities for those who do save.
Money does not compound because it just sits and grows. It compounds because someone (who is borrowing) is paying interest.
personal debt levels once again are at all time highs and most people are drowning in debt, how is this healthy for our country? How is this form of money management a good thing? Please, just stay focused on the topic I brought here, money management.
I’ve been saying all along our increasing debt burden in all sectors of our economy are growing way beyond our means. Most cities and states unfunded liabilities are in big trouble.
Huge debt levels that exceed our GDP are not healthy. A FED that has created Trillions of dollars of debt to backstop our markets is not healthy but a temporary illusion with possible dire consequences.
Personal debt and lack of savings for retirement in our nation is a very serious issue.
How are these specific factual topics good for our nation?
Can we educate our way out of an economic meltdown?
You are the PhD in finance, you tell me how extreme levels of debt are good.
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You should check out Mike Rowe to understand why we are in this mess with the trades
Thank you for suggesting Mike Rowe. He’s trying with his heart to fill a great void in our country.
I love his work and his passion.
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Honesty?Why would someone who didn’t know that this was a homeschool board start out his first post by saying that he was a homeschooling dad ? No one is out to crucify you but you pair an apology with a post bragging about how humble you are. Then you pair another apology post with what looks quite frankly like a lie about what kind of board you thought this was. You might not like the honesty of the long time posters here but we have a long track record of giving honest advice on all sorts of educational and life situations. And we have a long history of asking actual questions asking for advice for our own situations. We have lasted here through all sorts of posters from all sorts of backgrounds. We are protective of this board and don’t like it if something or someone seems “offâ€. For the most part we are a friendly bunch but we do call a spade a spade. Advice isn’t worth much if it isn’t coming from a place of honesty.
Edited to add some missing words that were necessary for clarity.
I knew this was a forum for homeschoolers but I also thought there were many college professors, public school teachers and business owners as well. That was all I meant. I thought there was a larger spectrum of public and college level teachers. My mistake. I assumed this from a friend who told me about this forum.
Why would you call me out for suggesting our entire country needs to educate our youth more in money management by looking at the facts, and how much debt in all sectors of society there is?
How else should we reverse this terrible trend if not through much more education?
As an educator, why would you lambast and insult me for suggesting that more education is needed regarding a dire situation in our country.
You are not protective lady, you are rude and insulting.
I make a few factual points aimed not at this boar, but at the terrible state of debt our country is in, and most of you that replied as if I was attacking you personally even though my statements clearly stated I was talking about our nation’s education system, not you the reader.
What it looks like to me is not protecting your forum, but attacking new comers out of discrimination, prejudice, hatefulness, name calling and just pure rudeness. Learn some manners ladies please.
I’ve never in all my life stirred up a hive like this by suggesting that more kids, not your kids, but more kids need to learn the power of compounding and many more money skills.
Who would have thought suggesting a man worth $14 billion and using some of his systems for asset allocation not aimed here but in general as an education tool would be thrown back in my face like I was selling an out of date vacuum cleaner as a door to door salesman.
I’m starting to think most of you like to fight instead of teach, but maybe it’s both, maybe you like to fight just to fight a guy who suggested that our nation has a huge debt problem and maybe more education might help.
But then again, maybe not. Maybe we just keep racking up massive debt in our country and bashing a guy like me who asks what are we teaching our kids about money management and how are they going to fix what our generation has handed them.
Blaming others and bashing people like me for asking questions about it is not going to make our country better.
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I believe that my state does require a personal finance course. It's one semester long. I know that many people use Dave Ramsey materials, but there are others, too. My kids are younger, but I hear enough people at our co-op talk about it that I think it's one of those things, like public speaking or typing or a fine arts credit, that students are supposed to do sometime during the 4 years of high school.
An example of a nice reply. It’s all I was wanting, a little feedback.
It was the first reply before older posters came back with attacking me.
At that point of the riot it became instantly unpopular to be nice and extremely important to be part of the fight against a guy asking a simple question or sharing examples of success stories.
I never said anyone should do this or that, I just gave examples of how some of this countries most successful managers do it but the story line was here was instantly twisted to me preaching.
I think it was all crowd control, the oldest posters here took a stand and said how dare this man prick come here and ask such questions.
People usually don’t against those well established in any crowd, this place is no different but for the few polite mothers, thank you for your kindness.
I think some of you got off on the man bashing thing.
Excellent show of support for the old posters here who set the tempo, bravo.
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:iagree:
Ummm ... here is what you should have learned ... don't come onto a homeschooling board full of educated, accomplished, hardworking parents and mansplain financial education. You seem to not be listening to what the other people are trying to say, but tell us all how we are doing it wrong. Good for you that you are the paragon of financial virtue. Just don't assume that we are all a bunch of illiterate rubes who couldn't possibly have any knowledge on this subject.
What I learned about you is that you are an argumentative know it all who can't possible imagine that any of us homeschooling moms could possibly have any knowledge or understanding on this manner and that you believe that we need to you to bless us with your superiority. (That is sarcasm in case you didn't pick that up.)
I, too, am waiting for the sales pitch. (BTW, if you are trying to sell something ... against board rules BTW ... insulting your potential customer base is not the way to win customers.)
To the rest of you ... sorry for feeding the troll. I'm in a feisty mood after reaching my tolerance threshold of people with no social skills.
Thank you so much for your positive feedback.
I understand fully.
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Just for your information , some of us homeschooling parents (not just moms) are, in fact, college professors, public educators, or run businesses. One does not preclude the other.
And we did answer that it should be taught, that it is taught in schools, and that we teach it in our homeschools.
You are correct, my question was answered.
I’ve learned a lot from you all, especially about how to communicate better on my part.
I apologize for the preaching, that’s 100% my fault.
Humbled from mistakes here, I’ve learned a lot from all of you.
Thank you again.
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Just for your information , some of us homeschooling parents (not just moms) are, in fact, college professors, public educators, or run businesses. One does not preclude the other.
And we did answer that it should be taught, that it is taught in schools, and that we teach it in our homeschools.
You are correct, my question was answered.
I’ve learned a lot from you all, especially about how to communicate better on my part.
I apologize for the preaching, that’s 100% my fault.
Humbled from mistakes here, I’ve learned a lot from all of you.
Thank you again.
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I had started an explanation of why I was waiting for the sales pitch several times but his posts were just so bizarre, often contradicting or plainly incorrect that formulating my response took so much time that I kept having to stop to do other things. For all it's worth, a superintendent is responsible for the maintenance of the buildings on a base. These people tend to be contractors and do not make $250,000 (don't get me wrong, they do get paid very well but they make more like $150,000). The people who make that kind of money are people who work outside the wire and they make that amount for obvious reasons. The bases themselves do not often get shelled, it is the transports that come under fire or projects in the community itself.
It is also not true that this money is tax free, when my hubby was in Iraq, the first $80,000 were tax free, the rest was taxed at regular rates.
I have never liked a post before but Creekland said it better than I could have :001_smile:
Just one more example of insulting.
What a rude bunch of people.
Pitiful and petty
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I would expect so. It is a Well Trained Mind board, after all, not a Get Rich, Rich, Rich!!! board.
I honestly would have a tough time living knowing I had oodles in the bank (or other investments) while offering just sympathy for the kids at school who don't have enough to eat - even with their parent(s) working. I also just plain like some of the "non-poverty relief" destinations for our giving (public TV, Christian radio, museums, education causes, youth causes). From my religious faith, I highly doubt God would be pleased with me either if we changed our budget to focus solely on us and socking away more than we need.
One can't give away all they have (at least, I don't suggest it), but there's an amount one needs (or projects to need) and then there's extra (for some of us, certainly not all).
Then too, I just don't want to go through most of my years and have done absolutely nothing, but have oodles in the bank. I've seen too many people plan to go places and do things in retirement only to find they don't make it there or can't do it then due to health issues. Kids grow up too. One only has limited years to take them places and do things with them. We've no regrets spending money doing things and going places with ours. It has given us great memories and helped develop their well trained minds.
Once one has enough, socking away more gets - what? Bragging rights? A private jet? A mansion? None of those are on my Bucket List. I'm content with a place to live (not everyone has this), food (ditto), transportation (ditto), health care covered (ditto), travels (ditto), and seeing what I can do to assist others or support things I like rather than socking away more than I need in the bank. As mentioned before, if we've guessed incorrectly with how much we'll need, at least two of my lads has said they'll be there for us. I'm content with that as a backup plan.
We all make our choices.
Where in all my posts did I say anything about get rich quick? I didn’t.
I know for a fact by reading back through the responses here my original question was turned from one simple question into a non stop barrage of rudeness, insults, and ideas I never mentioned like pumping a get rich quick scheme.
I also realize I should never have posed this type of questions to home school moms. It was a total mistake on my part. I thought I was posting to a board of public educators, college professors and possibly businesses leaders. It was a huge mistake to come here and waste all of your time with asking anything concerning money management skills.
I was and have been totally out of line here by asking such a question concerning education.
I truly am sorry for all the trouble I’ve been.
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End of thread.
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I don't think these numbers are correct. There was a back-testing period of 1984-2013 which had a return of 9.7% (and that ignores the fact that back-testing returns are often higher than real returns due overfitting or survival bias). The longer period, going back to 1925 was not the same portfolio--and the returns were only 7.2%.
From what I have seen, the benefits do not come from dollar cost averaging, but from consistent savings. Also, very few investors have "forever" as an investment horizon. Even those who have a very long investment horizon cannot count on dollar cost averaging into specific stocks and holding those stock forever. These returns are from a broad portfolio (probably the S&P500, which has had a large amount of turnover of specific stocks).
Also, most individuals cannot mimic much of Buffet's investment strategy--he tends to buy companies not stocks.
Am I understanding you properly?
You are calling Ray Dalios historical unmatched performance over 30 straight years a methodology that others should not trust nor try to follow with asset allocation discipline?
http://fortune.com/2017/09/13/ray-dalio-bridgewater-associates-book/
I was trying to point out Rays methodology and performance, not mine.
So, if you were going to teach advanced money management skills are you saying you would not use Ray Dalios unmatched long term performance as a great example of proper asset allocation, one that he shared with the world in 2014?
If not using a winning system or example of the all weather asset allocation plan like Rays do you have a more stable profitable growth plan you can share with Ray, myself and the likes of Tony Robbins?
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In my opinion Ray Dalio has the closest thing to a long term stable approach to asset allocation.Where am I going to earn an 8% return on my investments? By lending to someone who is borrowing?
Ray is worth over $14Billion and runs a closed hedge fund worth over $150Billion.
Please read the links below.
His biggest draw down in 2008 using his conservative approach was approx -3.93%.
It averages 9.72% per year since 1925 back tested.
http://awealthofcommonsense.com/2014/11/back-testing-tony-robbins-weather-portfolio/
Duplicating The All-Weather Fund Using Low-Cost ETFs
Other successful investors like Buffet dollar cost average into the stock market. The average stock market return since the 1920’s has been around 10%.
The question was where can 8% returns be had?
History proves if you dollar cost average and hold forever the trend is most likely your friend. It’s still the best game in town for growing your money.
For less volatility an all weather Ray Dalio asset allocation is best.
It’s worked for his very rich clients.
Hope this helps.
So the thread began with educating our youth concerning money management.
I never meant to preach to anyone. I truly apologize to all if I offended or put anyone off.
I know there are extremely intelligent people here. I hope we all can help those out there in the world who just don’t know. Helping others I think is always a great thing.
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I think this is the main reason your thread went awry. You seem to be vastly under estimating the majority of posters here. I dare say most people here do understand compounding of interest and teach it to their kids, so it came across as somewhat insulting to have a new poster come along trying to lecture us all about the importance of it. That mansplaining thing. It’s not the idea of teaching compounding of interest that anyone was objecting to, as far as I can see.
I never attacked the people here, nor said they weren’t teaching their kids. However I do find here people who make us things concerning my posts. I never attacked or berated anyone here. It’s been the opposite. I wasn’t preaching, I suggested our society needs more education concerning money management and I pointed out the dire fact of a country full of all kinds of people who find themselves in huge debt while they sip their $6 Starbucks and Tweeting away on their $1,000 iPhone while Christmas shopping charging more on their credit cards making Visa and Macy’s richer while striving to pay off their college loans and 84 month car loans on top of their 30 year house note making yet another bank richer.
We have vast tools in our country we can use to get ahead, like supportive families who are now helping each other by living at home longer to cut down on the outrageous cost of living.
We have many investing vehicles we can use to get ahead with our earnings. We live in a great country but the vast majority are totally uneducated in money management and the power of investing properly.
What harm I thought would there be in suggesting we strive to teach our young children much more about this topic so their generation might be able to govern their own lives better or govern a city, state or our federal government in the future so they don’t repeat the mistakes of this generation when it comes to total failure of society in general to manage their finances better for retirement and or older age.
What harm would it be to discuss this very important topic.
Higher learning in finances, investing and a well rounded understanding of how money can grow in time if invested properly is key not only in making money with money but how to keep it once we have great wealth. How many great success stories are there where an undereducated person in money lost everything. That college degree and higher education can not stop a failed money management plan where one has no plan, nor education.
All of the degrees and education in the world won’t save ones standard of living and wealth if one doesn’t lean how the game of money is played in the jungle of life.
I say train and educate our kids for the jungle where everyone and all businesses are out to take ones money.
I bet most people here have no clue as to the hundreds of thousands of dollars most mutual funds in the $7 Trillion mutual fund market soaks its participants in high hidden fees. Some are as high as 3.93% a year, which over twenty to thirty years can rob vast fortunes from the uneducated populous. It’s highway robbery that 99% of our clueless public that participates in company 401K plans are never educated in. They have no clue the DOL can be called in to audit a companies 401K mutual fund plan and if you own a business and are unaware of how your employees are being fleeced in high fees, guess what, you are liable and be fined by the federal government now.
Education. So why are 100% of people who participate in the great American scam of mutual funds clueless about the fees that are robbing them blind? Because the administrators like Fidelity don’t want the public educated. They make money regardless of the markets performance because they rob the masses in high fees because the masses are not educated in money management tactics.
So you all tell me how the game of money management is played in the jungle of life.
They don’t teach this level of reality in high school nor in home school because entire industries count on the ignorance of the masses in the jungle to rob.
Only now are most people waking up and moving their IRAs into low cost index funds and converting to ROTH accounts because taxes in the future will be higher not lower.
I could go on and on about educating the masses in proper money management skills.
I will say it again, our country lacks education greatly in this realm.
The evidence is clear. The vast majority have zero savings, tons of debt and not enough money to invest.
Why?
There is no excuse for a country so rich with higher education. None.
We can do much better as a nation. I don’t accept we can’t change the uneducated in this matter.
I’m not preaching to the intellect here but rather for a nation struggling with the lack of money management skills from a personal level to a federal government that is over run with stupid insane out of control spending.
We can do much better.
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Great. A blue collar self made guy like me who hated Algebra because it wasted my time, I use an app created by someone really good at Algebra 2 while I was busy getting the power run to his lights and computers and making millions in the stock market because I’m self taught there too.Just an aside....Compound interest is an Algebra 2 topic in the logarithms and exponential functions unit.
The Monkey Chimp App was probably created by a person really great at Algebra for dummies like me.
God Bless them.
It takes a village full of us helping each other to build a better village. Some like dirt, some like Algebra 2. I still like dirt and the smell of building massive projects as the sun rises on a new day. I would die in a cubicle. No sun, no wind, no snow, no fun.
Peace
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Kinsa,
I’ve been in the construction industry all my life beginning as a young boy. My grandparents and parents had their own businesses and I worked alongside them starting at age 4.
Long before we were too scared as a society of lawyers and litigation, I worked earning money in the summers in chemical plants, and I was snuck into to many other projects throughout our state. I worked and had my own checking account and savings at ten years old.
I’m semi retired now.
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You're 54 years old and you've spent "more than 40 years" in the building trade?
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MerryatHope,
The government has no power large enough I am afraid other than its utter and total collapse upon its self to live within its means.
There is no physical nor political constraints large enough to stop the beast from unbridled spending. With its back against the wall on March 9, 2009 the FED had two options. Our markets could totally cease up causing a total global financial dead stop and a modern Stone Age or it had to create a back stop from thin air whereby printing money with nothing but faith to ignite the present almost nine year bull market.
The FED prostponed a total catastrophe in March 2009, jump started the global economic engine and created $13 plus Trillion in debt and over $109Trillion in unfunded liabilities.
So I totally agree with you, our government must live within its means but I’m afraid the only game in town is growth no matter the level of debt created to get us there, until it simply doesn’t.
The great FED unwind hasn’t even really begun yet. But that’s a whole story not meant for this forum.
I guess we shall see.
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Thank you, btw, for the fond memory you brought me: My family was eating out at our favorite pizza joint when my grandpa pulled out a pen and used a napkin to explain compounding interest to me. Good stuff! :)
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There is no sales pitch. I’m just an American dad.
I thought I might bring up money management here as an area that our youth and others could use more education in.
I brought the importance of saving and investing as young as possible because time is an important factor.
I’m not selling anything other than established proven financial investing doctrine as it relates to dollar cost averaging, using the power of compounding to grow our wealth and getting started as soon as we can in life.
I was also trying to point out that if a child doesn’t want to go to college there are of course as many of us know other alternatives but regardless my main point to this thread was just to say I don’t think the vast majority gets the whole idea of the power of compounding interest as it relates to investing as early as possible in life. If the vast majority practiced wise investing
the vast majority would not be in debt.
A poster here said it’s unrealistic to think the majority will ever change. I agree.
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I am waiting for the sales pitch.
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Creekland,
Thank you for sharing. On average a college education in most sectors pay more, however there are trades that are very lucrative, in demand, and require less time and money than college. Higher education is important to some, but not all, or even most. There is a huge cost to many years of college, including soaring debt and lost years of earning and saving. I was just trying to point out that how one manages money over time is very important, regardless of college.
With technological advances coming that will extend our lives, this is even more important. In the next twenty to thirty years, the average life expectancy may move up much higher than we expect, and with longer lives we will need to prepare ourselves to the related financial consequences,
I don’t think most will be able to fully retire at 65 if average life expectancy moves up to say, 90, or 100 or more, with the coming medical advancements, making investing properly from a young age even more important.
Thank you again for sharing and replying.
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Big Question about education?
in High School and Self-Education Board
Posted
The Wall Street Journal reported defaulted student loans last quarter totaled $84 billion.
Defaulting, especially on the scale of $84 billion, can also have repercussions for the entire economy. The Federal Reserve Bank of New York has researched how student debt has depressed home purchasing by young adults, and found that as much as 35% of the decline in home ownership of people in their late 20s can be attributed to student loans. Defaults make it harder to take out credit or even own a credit card, stifling additional economic activity.
Even with a strong national economy and a low unemployment rate, loan defaults can weigh down the entire country. Permanently defaulted loans are ultimately the burden of taxpayers, and the federal budget will pay out if the loan program continues to lack revenue.
A Big Question continues to grow in scope.