Marie in Oh Posted July 11, 2008 Share Posted July 11, 2008 in various forms: IRA's, Mutual Funds, and individual stocks, etc. What do you do with the current state? 1. Leave it there, keep investing, there are bargains out there. 2. Leave what is there, stop investing, hope it recovers. 3. Stop investing and pull it out. Put it in a savings account. It is foolish to think it will ever recover. 4. Pull it out, transfer it to a foreign currancy. 5. Other Sorry, I am too dumb to figure out the poll option. Quote Link to comment Share on other sites More sharing options...
jmgconner Posted July 11, 2008 Share Posted July 11, 2008 #1 - and buy - as Dave Ramsey says, stocks are on sale. :D ETA: Obviously, your age and retirement plans will come into play. I'm answering as my 33 year old self with lots of time left to invest and recover. Quote Link to comment Share on other sites More sharing options...
Jennifer in MI Posted July 11, 2008 Share Posted July 11, 2008 :iagree: We're continuing to buy more and more shares. When the market recovers (and it will!), we'll be even better off than we are now. (God willing, of course.) It's tough to get those quarterly statements and see how much money you've lost though - isn't it? Quote Link to comment Share on other sites More sharing options...
laylamcb Posted July 11, 2008 Share Posted July 11, 2008 It depends. If you're 65, well, you probably should've moved into less volatile holdings a while ago. :001_huh: But if you're in your 30s or 40s and have decades of saving for retirement left to do, by all means, keep investing on a regular basis. And when you get your statement saying that you invested $10K this quarter and yet your portfolio has lost $7K, just keep telling yourself what a STEAL you got and that you own more (even if it's currently worth less). ;) Quote Link to comment Share on other sites More sharing options...
C_l_e_0..Q_c Posted July 11, 2008 Share Posted July 11, 2008 It's tough to get those quarterly statements and see how much money you've lost though - isn't it? Very tough, especially since we have no more of that money coming in for investments. What's there is all we'll ever get. So it's not like I can put even more money in to take advantage of the low market... Still, all $ will stay there. To pull them out now would be folly. Quote Link to comment Share on other sites More sharing options...
Adrianne Posted July 11, 2008 Share Posted July 11, 2008 Leave it there, keep investing, there are bargains out there. Since dh and I are not close to retirement, our goal is longterm investing. During times like this we leave everything as is. He even keeps investing in his stock purchase plan at work. Over the long hall every thing will balance out. If you are close to retirement, then this is a different story. Pulling your money out however, is a losing situation. Quote Link to comment Share on other sites More sharing options...
Jennifer in MI Posted July 11, 2008 Share Posted July 11, 2008 Very tough, especially since we have no more of that money coming in for investments. What's there is all we'll ever get. So it's not like I can put even more money in to take advantage of the low market... Still, all $ will stay there. To pull them out now would be folly. But, as the stock market loses value, you are gaining more stocks. So, when it starts to rally, you will notice huge gains! So, in a sense, you are still investing! Quote Link to comment Share on other sites More sharing options...
Marie in Oh Posted July 11, 2008 Author Share Posted July 11, 2008 It seems like it is overwhelmingly to keep investing as is. So, no one thinks we are truly headed for a depression? I mean, the stock market is worthless if the dollar crashes. #1 is the advice that professional investors give you. After all the broker still wants his paycheck, and he gets a portion of what we invest. #3 is what a friend in church keeps advising dh. He thinks we are in for a imminent depression. #4 is what dh is reading about-- switching currencies. That seems really risky to me. All I know is that when the market goes down 3000 pts, that is ALOT of money. Quote Link to comment Share on other sites More sharing options...
C_l_e_0..Q_c Posted July 11, 2008 Share Posted July 11, 2008 But, as the stock market loses value, you are gaining more stocks. Hmmm. No. Not really. If I own 100 shares at 50$ for a total of 5,000$, and they go down to 25$ I simply end up with 100 shares at 25$ for a total of 2,500$. I don't have more stock. I have the same stock. Eventually it will go back up to 50$ and I'll be where I started. Quote Link to comment Share on other sites More sharing options...
C_l_e_0..Q_c Posted July 11, 2008 Share Posted July 11, 2008 #4 is what dh is reading about-- switching currencies. That seems really risky to me. Well, I am investing in multiple currencies, and I'm still seeing the hit. I guess I might have the wrong currencies ;-) It's no more risky than investing in your own currency. It's all about knowledge. If your stock broker is knowledgeable in the target currency, and you trust him/her, that's all you need. Quote Link to comment Share on other sites More sharing options...
sandellie4 Posted July 11, 2008 Share Posted July 11, 2008 I really anguished about this during the crash in the 90s, but we left it in our 401(k), etc. And when the market recovered, WOW, we were really glad we'd left it in there. We hadn't had that much to start with, which probably helped in the decision to leave it in there, but we were doing a lot better afterward. We're leaving it all in there again, even though we have more to lose now. The economy is cyclic and what goes down must go up (and what goes up must come down!). Sandy Quote Link to comment Share on other sites More sharing options...
Kathy in MD Posted July 11, 2008 Share Posted July 11, 2008 My dh is retiring soon and we're leaving our investments alone. The only thing I wish I'd done several years ago was invest more in dividend paying stocks. Quote Link to comment Share on other sites More sharing options...
jmgconner Posted July 11, 2008 Share Posted July 11, 2008 It seems like it is overwhelmingly to keep investing as is. So, no one thinks we are truly headed for a depression? I mean, the stock market is worthless if the dollar crashes. #1 is the advice that professional investors give you. After all the broker still wants his paycheck, and he gets a portion of what we invest. #3 is what a friend in church keeps advising dh. He thinks we are in for a imminent depression. #4 is what dh is reading about-- switching currencies. That seems really risky to me. All I know is that when the market goes down 3000 pts, that is ALOT of money. I don't know if we are headed for a depression or not, but I think it would be absolutely the wrong thing to do to pull money out of the market right now. The single worst day and week in stock market history (showing the biggest losses - 1360 points) was right after 9/11. What the media failed to tell us that even after the horrific event and loss of life, the stock market recovered by Jan. 2002 - just 4 months later. 3000 points is a lot of money, and I suspect it'll fall even further, but I also believe that those of us in the stock market for 10+ years will recover any losses. Oh, and all this to say, that I'm trying to prepare myself for a depression. Paying off debts, learning basic survival skills (gardening, canning, etc.). Even with those things in mind, I don't plan on touching our investments. Quote Link to comment Share on other sites More sharing options...
Guest Virginia Dawn Posted July 11, 2008 Share Posted July 11, 2008 Traditional wisdom says leave it in for the long haul. Quote Link to comment Share on other sites More sharing options...
Colleen Posted July 11, 2008 Share Posted July 11, 2008 Are you free of debt? (Rhetorical question; I don't expect you to share the details here.) If so, and given your relative youth, I'd sit tight. Long-term investment shouldn't be dictated by market volatility. Quote Link to comment Share on other sites More sharing options...
Karenciavo Posted July 11, 2008 Share Posted July 11, 2008 You leave it and keep investing. My older sons' college savings is 25% stock and I'm still going to leave it and hope for a rally in the next 3 years or so when son #1 begins using his. Quote Link to comment Share on other sites More sharing options...
Amy loves Bud Posted July 11, 2008 Share Posted July 11, 2008 We are continuing to invest, mainly because of the tax benefit of investing in Bud's SEP IRA. However, looking ahead, at the next decent market upturn, we will begin moving non-IRA money out of stocks and into real estate. Not real estate funds, but actual real estate. Again, this is not IRA/401k money that would be penalized for early withdrawal. That will stay put, and moved to less risky investment profiles as retirement draws nearer. We are in a situation where we annually watch Bud's business drift overseas, and it's only getting worse. This is why we worked very hard to pay off our mortgage last year. Further investing in real estate will not only serve as an investment but also as an income stream. We hope. :D Quote Link to comment Share on other sites More sharing options...
Sara R Posted July 11, 2008 Share Posted July 11, 2008 I agree with Dave Ramsey on most things, but this is a big area where I disagree with him, and with conventional financial planner wisdom. I think there are a lot of reasons why the long term value of the stock market doesn't look as good as it might. One reason, like you mentioned, is the dollar. Our country is in so much debt and there is no way out where the value of the dollar can be preserved. If you believe this, it's a reason to choose #4 (or a commodities index, or stocks denominated in foreign currencies, or precious metals). If the government bails out Fannie and Freddie, that's bad for the dollar (because it increases our national debt by tons), so be watching. Another reason I don't like stocks long term is that the baby boomers will be retiring in the next 10-20 years. My generation is much smaller than the baby boomers, and with decreased birth rates the population is getting smaller. It would make sense that the stock market contracts to match that. I wouldn't have as much of a problem investing in retirement funds if I had done lower risk things to put me and my household in a better position: paying off the mortgage, making sure there were good stockpiles in the basement to meet future needs, "investing" in tools and energy efficient things to reduce your cost of living. If you think about it, money invested in getting your paid-for house off the grid is an "investment" in retirement in a way, assuming you plan to stay in that house forever and if eventually utility costs rise enough to make it worthwhile. These are relatively risk-free ways to plan for your future, including retirement. The stock market is pretty risky, especially in this environment. The stock market has had a flat-to-negative 10 years (search the Wall Street Journal for "lost decade"), and there are a lot of storms on the horizon that suggest that the next 10-20 years could be worse. Quote Link to comment Share on other sites More sharing options...
LMA Posted July 11, 2008 Share Posted July 11, 2008 We do not categorically move everything into or out of stocks. We evaluate each owned stock/industry individually. We look at the losing industries. For example, bank stocks and pharmaceutical stocks are not doing well and we decide what we want to do with those industries - to sell, buy more, or hold. Anything sold as a loss can be deducted up to $3,000 on your tax return each year and it can be carried over. Many stocks are doing very well. That's why you have to look individually at your own holdings and not pay too much attention to the media. You will get confused and panicky. Many stocks, over the LONG term, will grow more than a savings account rate. Be sure you have enough cash stashed away for your particular situation- CDs, money market accounts, savings accounts, etc. I recommend being a well informed investor. I still read Value Line and things like that to help me understand where a stock is most likely to go. I find that if you do too much of changing your entire portfolio too often, you end up losing a lot more in the end. Quote Link to comment Share on other sites More sharing options...
mcconnellboys Posted July 11, 2008 Share Posted July 11, 2008 Well, I think #1 is okay if you're younger. We are getting older, so we're tending to diversify more, putting more into bonds, cash, and looking at gold, too. Quote Link to comment Share on other sites More sharing options...
Melissa in Australia Posted July 12, 2008 Share Posted July 12, 2008 I have never invested in the stock market. I have invested in land!!. at least I have something visable for my money. Quote Link to comment Share on other sites More sharing options...
mcconnellboys Posted July 13, 2008 Share Posted July 13, 2008 Yeah, and I tend to think that most land in most places is going to continue to hold its value and increase over time, so I'm fighting to hold on to our family's land, too. Quote Link to comment Share on other sites More sharing options...
Sharon in SC Posted July 13, 2008 Share Posted July 13, 2008 OH, yeah.:glare: Quote Link to comment Share on other sites More sharing options...
Sharon in SC Posted July 13, 2008 Share Posted July 13, 2008 And when you get your statement saying that you invested $10K this quarter and yet your portfolio has lost $7K, just keep telling yourself what a STEAL you got and that you own more (even if it's currently worth less). ;) I like the sound of this! :001_smile: Quote Link to comment Share on other sites More sharing options...
love2read Posted July 13, 2008 Share Posted July 13, 2008 Those of you that are going to invest in real estate, what are you planning on buying? Land? Homes? Apartments? We want to do that when the market rallies, but all of the companies in our small city have pulled out and this is a fairly depressed area now. I'm hesitant to invest in real estate where we don't live. Quote Link to comment Share on other sites More sharing options...
Laurie in CA Posted July 14, 2008 Share Posted July 14, 2008 by Richard Maybury. I read this book a few years ago and he has some great suggestions on how to invest. He is libertarian so doesn't trust the government and doesn't care much for the stock market. Anyway, his attitude is to "Keep What You Have Earned" (what a novel idea) and he has a bulletproof investment model called the "Permanent Portfolio" plan taught by financial advisor Harry Browne (the guy who used to run for president). Browne's book is called Fail-Safe Investing--Lifelong Financial Security in 30 Minutes found on his website. I actually purchased the e-book and read it in a couple of hours. My husband and I carefully began the process of switching our investments into the ratios suggested for stock market, long-term U.S. treasury bonds, gold, and money market. Our portfolio has done quite well in spite of the downturns in the stock market. We adjust once a year sometime in January to the original ratios and just let it ride. Don't adjust before January or you will lose those mutual fund dividends at the end of the year! The stock market is way too risky to have all your money there. Again, like others here have said, don't sell all your stock low. Look for opportunities to sell as the price rises (and it will) and buying opportunities when the price is low. Sometimes you won't have much of a choice if your money is in company 401-k's but if you can get a self-directed IRA, you can make all of your own choices. (We have both) Make the switches slowly because buying gold at its highest price makes no sense. We bought the bonds in March when the new ones were issued and didn't worry about the market price because the interest rate is fixed on those. I'm kind of rambling but I feel we at least have plan and have significantly lowered our risk by decreasing our investment in the stock market and have diversified into bonds and gold. There is more to it than what I have presented but hopefully you get the idea. Laurie in CA Quote Link to comment Share on other sites More sharing options...
Amy loves Bud Posted July 14, 2008 Share Posted July 14, 2008 Those of you that are going to invest in real estate, what are you planning on buying? Land? Homes? Apartments? We want to do that when the market rallies, but all of the companies in our small city have pulled out and this is a fairly depressed area now. I'm hesitant to invest in real estate where we don't live. For us it's a mix. We recently bought some land at auction in New Mexico,and will probably be buying more soon. We also have an offer on a house in our neighborhood that is going to foreclosure. It can take some time to hear from the bank on that, so we'll see. We will probably do the necessary repairs and put the house for sale or lease and see what happens. This really isn't a "Flip THis House" kind of area, so I imagine it will end up being leased. Anyway, it's a combination of property types for us, I suppose. Oh, and we are also considering purchasing some land in southern Mexico or Central America, but more in the long term for that. Quote Link to comment Share on other sites More sharing options...
Melissa in Australia Posted July 14, 2008 Share Posted July 14, 2008 Those of you that are going to invest in real estate, what are you planning on buying? Land? Homes? Apartments? We want to do that when the market rallies, but all of the companies in our small city have pulled out and this is a fairly depressed area now. I'm hesitant to invest in real estate where we don't live. we bought the 5 acres across the road from us. it has gone up in value by 200% in the last 5 years:001_smile:. we plan to build 2 houses on it,and rent them out. we will do the building ourselves. Quote Link to comment Share on other sites More sharing options...
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