Big Question about education?

[Bootsie]

In my opinion Ray Dalio has the closest thing to a long term stable approach to asset allocation.

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

 

https://www.tonyrobbins.com/wealth-lifestyle/the-end-of-the-bull-market/"]https://www.tonyrobbins.com/wealth-lifestyle/the-end-of-the-bull-market/[/ur

 

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.

 

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.

[Old School]

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?

[Bootsie]

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?

This says 7.2%, not the 9.72% you quoted.  

 

My understanding is that the portfolio described is a hypothetical, backtesting of a strategy, not Dalios's actual methodology or performance.  There is much about this that I would say is a good strategy, but I think it is important to know exactly what it is (and what it isn't)

[Jean in Newcastle]

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.

I was hoping that you would show up on this thread! I know that you actually have schooling and experience in this area.

[creekland]

I suppose it comes as a surprise to many, but some of us on here aren't trying to become multi-millionaires.  My conscience would never let me do it while still seeing the multitudes in need.  I also don't try to get "great bargains" when buying from other individuals even when I know I could due to their circumstances.  We pay more than we need to - often - in order to try to spread the balance of our income and try to equify incomes.

 

We save for retirement and have made quite a bit on our investments (often leveraging debt actually), but multi-millionaire?  Not our goal.  We've used as much money as we've saved on "living" now (mainly traveling and things with our kids).  We've given away a good bit - many times not even tax deductible giving.  It's just when we see needs and can do something.

 

Our kids aren't likely to have to take care of us financially in our old age, but if we've guessed incorrectly at how much we need, at least two of them have said they are more than willing to do so as they really appreciate how much we've done with them over the years rather than putting it all away for "us."

 

No regrets at all.  I'd consider myself a failure if I died with millions in the bank.  Granted, leaving it to others could benefit them at that point, but it also could have benefited them much earlier if I hadn't been so ________ (greedy is the word that comes to mind, but I'm not sure it's the right one).

 

To us, there's a balance.  No regrets at all.  Absolutely none.  YMMV

[Jean in Newcastle]

Yeah. Multi millions isn’t my goal either. God has given enough for our needs, though money can be very tight at times. But we made choices- for me to stay home and to homeschool the kids. For Dh to pastor a small poor congregation that doesn’t even pay him a salary. Instead, he works a “real job “ during the week to make ends make.

 

We understand how to invest. We understand compound interest. I am still a bit gobsmacked that it is supposed to be such an earth shattering concept since I learned how to compound interest when I was 15 along with the rest of my class and we didn’t use an app to do it.

 

Our children know how banking and investing works. They know how to delay gratification and how to save for both needs and the occasional wants. I would rather that they learn how to serve others while of course also being able to meet their needs and that of their family. I don’t put my trust in investing to solve the problems of the world or our society in particular.

 

 

Sent from my iPhone using Tapatalk

[Old School]

End of thread.

Edited December 11, 2017 by Old School

[snowbeltmom]

I suppose it comes as a surprise to many, but some of us on here aren't trying to become multi-millionaires.  My conscience would never let me do it while still seeing the multitudes in need.  I also don't try to get "great bargains" when buying from other individuals even when I know I could due to their circumstances.  We pay more than we need to - often - in order to try to spread the balance of our income and try to equify incomes.

 

We save for retirement and have made quite a bit on our investments (often leveraging debt actually), but multi-millionaire?  Not our goal.  We've used as much money as we've saved on "living" now (mainly traveling and things with our kids).  We've given away a good bit - many times not even tax deductible giving.  It's just when we see needs and can do something.

 

Our kids aren't likely to have to take care of us financially in our old age, but if we've guessed incorrectly at how much we need, at least two of them have said they are more than willing to do so as they really appreciate how much we've done with them over the years rather than putting it all away for "us."

 

No regrets at all.  I'd consider myself a failure if I died with millions in the bank.  Granted, leaving it to others could benefit them at that point, but it also could have benefited them much earlier if I hadn't been so ________ (greedy is the word that comes to mind, but I'm not sure it's the right one).

 

To us, there's a balance.  No regrets at all.  Absolutely none.  YMMV

Very well said.  I bet there are many of us on here who have the same philosophy.

[creekland]

Very well said.  I bet there are many of us on here who have the same philosophy.

 

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.

[regentrude]

End of thread.

 

This is actually not how things work on this board....

Edited December 11, 2017 by regentrude

[snowbeltmom]

This is actually not how things work on this board....

 

Yep.  My thoughts exactly.  First we are lectured and then we are dismissed. 

 

[creekland]

This has been such a bizarre thread. I'm still not sure what the point was. Man'splaining, I guess.

 

It kept some of us mildly entertained, but then again, I'm used to explaining the real world vs the ideal world to students (who often KNOW everything!!!), so I'm used to seeing such things and working with them to try to open minds.  If the gentleman is a teen, his mind might have opened some.  If not, we're probably all too pathetic for him to deal with.  Such is life.

 

This is actually not how things work on this board....

 

I think that has to do with the Well Trained Mind bit too...

[Jean in Newcastle]

 

 

Also, bro? Construction and some other trades are HARD on a body. I don't think it's sensible to lump them in with all the other trades in a flippant "just do this trade b/c it makes moneies" sort of way.

This is so true. I know some very hard working men and women in the construction trades. By the time they are in their mid 40’s they are hurting. If they are lucky they have moved up to supervisory positions because it is hard climbing up and over things and moving big equipment all day. These are fit people who are moving a lot but the parts wear out or they have accidents.

 

My brother broke his back at a construction site in his mid 40’s. He was already foreman so even those jobs aren’t without physical risk. Then what? He had no college degree to help him get a job that was easier on the body. Things have worked out for him but not in a typical way because now generous people are supporting him in ministry. They are frugal people but didn’t have a “storing up riches†philosophy.

 

I’m not against trades. Many very intelligent and hard working people are out there doing them. My son works a job that sort of straddles the blue collar/ white collar world. He provides IT services for a blue collar company because everyone uses computers now.

[Bootsie]

I was hoping that you would show up on this thread! I know that you actually have schooling and experience in this area.

Thanks.  I want to make sure that I don't leave the mistaken impression that I am against beginning saving at a young age, saving systematically, and investing in a diversified portfolio.  I just think that one must be careful not to read more into these basic principles.  (Also, these are basic principles in the investment industry and are not unique to Dalio.)

 

As for compound interest, it is a concept that those who have a good, solid math foundation find easy to understand.  If one has strong math tools, one can use a formula to understand how money grows, as well as how a population of geese grows, how a virus grows, or how costs of company grow exponentially as a production facility reaches full capacity. 

 

One also must be very careful with working with compounding in the financial markets.   If you have a year with negative returns (which is statistically very likely), your compounded return will be LOWER than your average return.  For a simple example, suppose you invest $100 and earn 10% the first year.  You know have $110.  The second year you lose 10%.  You now have $99.  Your average return is 0%, but you have lost 1%.  I find those who preach the wonders of compounding often ignore this important fact in the financial markets.  

 

 I also find it a bit ironic when someone preaches the wonders of investing and the horrors of borrowing, but then gives financial advice regarding building a portfolio centered on lending to those who are borrowing.  If the federal government isn't borrowing, there are no government bonds to be investing in and earning a return on.  

 

I also find that many people misunderstand what the term "backtesting" means in financial markets.  It means that I come up with an idea--what if I bought stocks on Friday and sold on Monday, what if I put 30% of my money in stocks and 70% in bonds, or what if I put 50% of my money in health care stocks and 50% in transportation stocks--and then I look at what would have happened over the past 30 years if I had done that.  There are a number of statistical problems with this methodology.  Unfortunately, it is one of the few ways we have to test ideas in the financial markets.  We do not have the luxury of going into a lab and repeating experiments with control variables.  Backtesting can be useful, but one must be careful not to overinterpret the results.  

[creekland]

Thanks.  I want to make sure that I don't leave the mistaken impression that I am against beginning saving at a young age, saving systematically, and investing in a diversified portfolio.    

 

Ditto

 

One should be saving for future needs including retirement.  There are just other things to consider.

 

AND, not all investments (esp those with an 8% return rate) are SAFE (BTDT and LOST a bit with a couple of ours).

 

Save, diversify, but also use some of what you have (if there is extra, not everyone is fortunate enough to have that) to actually LIVE today too.  Some of that living is supporting people and causes we care about.

 

Life is a balance.  Few of us need to leave behind 25 million when we die, esp if it means we miss out on life before we die.

[Dmmetler]

Not only does my state require a personal finance course for high schoolers to graduate (as does most of the homeschool cover programs), but DD’s community college also offers one that is free and required if you are getting student loans or a state scholarship (and strongly recommended and incentivized for everyone).

[Bootsie]

Not only does my state require a personal finance course for high schoolers to graduate (as does most of the homeschool cover programs), but DD’s community college also offers one that is free and required if you are getting student loans or a state scholarship (and strongly recommended and incentivized for everyone).

I am curious, if you have any experience with these courses, how effective you think they are.  

[Dmmetler]

I am curious, if you have any experience with these courses, how effective you think they are.

The one at the CC at least required the kids to go through and see how taking out heavier loans and paying over a larger period of time added up (and the difference between no interest accruing over college and interest accruing from day 1), and dealt with a lot of budgeting/what if scenarios (one I liked dealt with buying a used car vs leasing a newer one, for example.). My DD found it a “well, Duh!†Situation, but I don’t think she was the target (I think the primary target was kids who take out the max student loan they can without thinking about paying it back, particularly those who also don’t finish a degree).

 

 

 

 

Sent from my iPad using Tapatalk

[Garga]

I suppose it comes as a surprise to many, but some of us on here aren't trying to become multi-millionaires. My conscience would never let me do it while still seeing the multitudes in need. I also don't try to get "great bargains" when buying from other individuals even when I know I could due to their circumstances. We pay more than we need to - often - in order to try to spread the balance of our income and try to equify incomes.

 

We save for retirement and have made quite a bit on our investments (often leveraging debt actually), but multi-millionaire? Not our goal. We've used as much money as we've saved on "living" now (mainly traveling and things with our kids). We've given away a good bit - many times not even tax deductible giving. It's just when we see needs and can do something.

 

Our kids aren't likely to have to take care of us financially in our old age, but if we've guessed incorrectly at how much we need, at least two of them have said they are more than willing to do so as they really appreciate how much we've done with them over the years rather than putting it all away for "us."

 

No regrets at all. I'd consider myself a failure if I died with millions in the bank. Granted, leaving it to others could benefit them at that point, but it also could have benefited them much earlier if I hadn't been so ________ (greedy is the word that comes to mind, but I'm not sure it's the right one).

 

To us, there's a balance. No regrets at all. Absolutely none. YMMV

But who says you have to keep your millions? If you got your hands on millions of dollars, would you buy a mansion with it? Nope. You'd give it away or donate it to causes, etc. There's no rule that says you have to keep all the money you earn/make in investing. I suppose you're saying that you'd have to take the money you'd give away now and invest it and wait for it to pay off in the future, but by then you might be dead? So instead you give it away now instead of investing it to give more away in the future? I can see that logic.

 

But if one invests and gets a bunch of money, it doesn't mean it has to be used selfishly at that point.

[creekland]

But who says you have to keep your millions? If you got your hands on millions of dollars, would you buy a mansion with it? Nope. You'd give it away or donate it to causes, etc. There's no rule that says you have to keep all the money you earn/make in investing. I suppose you're saying that you'd have to take the money you'd give away now and invest it and wait for it to pay off in the future, but by then you might be dead? So instead you give it away now instead of investing it to give more away in the future? I can see that logic.

 

But if one invests and gets a bunch of money, it doesn't mean it has to be used selfishly at that point.

 

I'm saying the same folks who would benefit later if it's given away then would benefit sooner if they had the $$ sooner.  ;)

 

For some, later could come too late whether that means food, education, health needs, or similar.

 

Causes can also use the money now vs more later.  What they get now could decrease the need for later (helping a family, discovering new cures, etc).

 

One needs to save a certain amount to provide for themselves and anyone depending upon them, but for the vast majority, that's not super high tons of $$.

 

Larger amounts can be used to start businesses, etc, but those are still working now - not just sitting and earning for "something" later (other than waiting to buy the business/house/car/education etc).

[rdj2027]

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:  

[Old School]

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.

[Old School]

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

[Jean in Newcastle]

But we answered your question about financial education in school. It is taught. You just (assumed?) that it wasn’t. Otherwise there wasn’t any real question. It was a lecture.

 

 

Sent from my iPhone using Tapatalk

[regentrude]

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.

 

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.

Edited December 11, 2017 by regentrude

[creekland]

 I thought I was posting to a board of public educators, college professors and possibly businesses leaders. 

 

You have all of the above and more on this board.  The knowledge and experience of The Hive (as we are known) is incredibly deep.  ;)

 

Absolutely no one will disagree that one should begin saving young, diversify their savings, and plan for their needs in retirement.  It is taught, but like all other lessons (similar to your love of Alg 2), what is retained and prioritized is up to the individual and is often somewhat dependent upon real world income and issues too.

 

I just had a young lass (high school) who told me she just moved in with a foster mother last Friday.  Do you suppose she can live with mom and dad up until she's 25 so she can start stockpiling 20K per year?  Real life indeed makes a difference to so many.

 

That's all we're saying.

[Old School]

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.

[Old School]

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.

[dirty ethel rackham]

Never mind.  Troll feeding and venting.  I shouldn't post when I'm exhausted and my ire is up.  

.  

Edited December 11, 2017 by dirty ethel rackham

[Old School]

: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.

[Old School]

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.

[creekland]

Never mind.  Troll feeding and venting.  I shouldn't post when I'm exhausted and my ire is up.  .  

 

FWIW, I'm pretty sure I'm with you at this point.  I thought similarly before, but wasn't totally sure.

[dirty ethel rackham]

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.

 

I said I was done, but I just can't let this go.  The point is ... you didn't come here nicely.  You came here, ignorant of what people here do or know, and told us all how  everything should be done.  You weren't asking questions, but validation of your opinions ... after you insulted many of us with your superior attitude.  This wasn't man bashing (there are lots of men on here who are respected members of this community who don't feel the need to belittle others.)  

 

man·splain

manˈsplÄn/

verb

informal

gerund or present participle: mansplaining

1. (of a man) explain (something) to someone, typically a woman, in a manner regarded as condescending or patronizing.

   "I'm listening to a guy mansplain economics to his wife"

[luuknam]

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.

 

 

You've obviously never seen a thread about cupcakes. Or grocery carts. 

 

There are guys on this forum - not many, but there are some, and most of them are well-liked by most people here. 

 

I'm still not sure what you think will happen if we all took your advice and started saving oodles of money, pronto. 

 

And if you'd been female, I'd happily have used the word womansplaining, which is not a word, but I've used it before. Netiquette rule number something-or-other: read some posts first to get a 'feel' for the norms of the group before posting stuff yourself (this btw, works irl as well). 

Edited December 11, 2017 by luuknam

[Jean in Newcastle]

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.

Edited December 11, 2017 by Jean in Newcastle

[Bootsie]

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.

 

Bridgewater is the largest hedge fund ever.  However, a couple of things must be noted.  Ray Dalio went broke and nearly shut Bridgewater down before turning it into the largest hedge fund ever.  He was in a position that provided some cushion for him so that he could recover from that loss and "stay in the game."  Many individual investors who might have followed his advice would not have been so lucky.  

 

Another important note is that what a hedge fund manager does cannot be replicated by the average, small, investor.  The hedge fund is using leverage (borrowing money) to increase certain positions in, the hope of increasing returns.  This could be extremely risky for the average investor to do.  Also, many of the instruments that this large hedge fund managers use are not available for the average small investor to purchase.  

 

A lot can be learned by looking at successful managers, but it is important to know what you are looking for which doing so.  

[Tranquility7]

Firstly, I don’t understand people who say they don’t want money. Don’t you like to give money away?? Don’t you hear of people trying to raise money for tons of good causes all the time like I do?  I think it would be an incredible privelege to be able to pay for adoptions for families. And to give kids scholarships to schools. And to help immigrants get settled. And to help families with dire medical needs. Who can help, if not people with money?

 

Secondly, (and I have said nearly this identical thing on another thread that was started by a new poster and then turned nasty – this seems to be a pattern, for some reason) am I the only one who thinks several of the responses to the OP in this thread are kind of out of whack? Whether or not you agree, it seems to me like he was merely trying to initiate a discussion. Maybe you disliked his tone or disagreed with his points, but this barrage of rudeness is simply bizarre to me.

 

It’s ironic that we are attempting to be classical educators and teach our children the arts of logic and rhetoric, yet the minute a new poster steps into our little “club†with a point of view that we object to, or which offends us, or doesn’t fit with our worldview, we often don’t even listen to what the OP is saying and respond to the actual points made, but rather jump all over him or her, misconstrue his argument (e.g. responding to him as though he is advocating utterly selfish materialism), and then resort to ad hominem attacks (“troll!â€).

 

Am I the only one to see the irony in that? I can’t imagine it makes the homeschooling community look anything but foolish, rude, closed-minded, insular, and emotionally fragile.

 

 

[Bootsie]

If someone is able to place $20,000 each year in a savings account for 7 years (from 18-25) and earn 8% each year, this will be the outcome:

 

 

YEAR Annual Return Interest Earned Additional Deposit Ending Balance 1   0 20,000 20,000 2 0.08 1600.00 20,000 41,600 3 0.08 3328.00 20,000 64,928 4 0.08 5194.24 20,000 90,122 5 0.08 7209.78 20,000 117,332 6 0.08 9386.56 20,000 146,719 7 0.08 11737.49 20,000 178,456 AVERAGE 0.080      

 

However, a major assumption is that the average of 8% is earned each year (which mathematically is different than on average earning 8%).  Consider, for example, a world where the average return is 8% over, but in some years it is negative and some years it is positive:

 

 

 

 

 

You get a much different result. (The actual yield in this second example is only 3.14%)   I am not saying that savings is not good, but the Rule of 72 is an approximation of how long it takes to double a lump-sum of money.  It is not really applicable when the return varies from year to year.   Thus, real understanding of compound interest requires understanding of mathematics.

--Sorry.  I can't get these tables to pull into the post properly.

Edited December 12, 2017 by jdahlquist

[happybeachbum]

As I look at our economy and the sorry state of personal finances from the highly educated to the poor, I ask myself, does it have anything to do with cooking skills?

 

The answer is no. It has to do with a total lack of education and training how to make money with money. It has to do with a brain washed society that teaches college is the correct destination after high school before real life begins. College has created in our youth over $1.3 trillion in personal debt and its only moving higher.

 

Most graduates leave with a diploma and an average debt of $45,000 and sometimes triple or even more.

 

Success is not merely measured by a college education.

 

My architect and engineer friends tell me all the time colleges are turning out kids right out of college who want big money but can’t function in the real world. They must totally relearn what colleges fail to teach. This is from professionals in the real world who meet head on fresh college grads totally focused on wanting more money but offer no real world value or experience.

 

Our country is entering a crisis that is getting worse. Our Air Force lacks 4,000 mechanics, 2000 pilots and many other positions. Our tradesmen in construction are on average nearing 50 years old with very few young people entering the trades.

 

Our country lacks people who can get things done, from flying jets, to driving a nail, to twisting wires to get the lights on.

 

I’ve spent over 40 years in building and I’ve persinally seen the degradation of our trades, our work ethic, as our society pushed for college educations.

 

There is a huge demand for Mercedes mechanics or Toyota mechanics that can earn over $100,000 per year.

 

There is huge value, demand and success awaiting those young men and women who may not want college educations and $50,000 in debt at 22. The trades are starving for highly intelligent motivated young people to take over where we 50 plus year olds are now retiring from.

 

Yes, I’m old school and a multimillionaire who never went to college. With the education of the power of compounding, old school hard work ethics, I’m here to say not all success is measured by a college degree. The world has fabulous opportunities in job careers that don’t cost $100,000 in debt to get.

 

But our public education that feeds the professors in college will refuse to teach what the Swiss have been highly successful with. Vocational trade education that can lead to higher education later in life.

 

I’m just old school.

You should check out Mike Rowe to understand why we are in this mess with the trades

[Old School]

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.

Honesty?

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.

Edited December 12, 2017 by Old School

[Old School]

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.

[Bootsie]

But then again, maybe not. Maybe we just keep racking up massive debt in our country and bash 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.

 

 

I 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.  

[Rosie_0801]

Blaming others and bashing people like me for asking questions about it is not going to make our country better.

 

Nor is posting on this forum.

 

You could try writing to your elected officials about your legitimate grievances. You could sponsor financial literacy programs in schools. You could donate appropriate materials to libraries. You could write materials if you think the currently existing products are inadequate. 

 

 

Around here, we use the acronym JAWM in thread titles, to indicate "Just Agree With Me." If you'd known to use that acronym, we'd have all been happy to agree that the state of financial education in schools could be a whole lot better. Since you didn't, your posts did seem awfully personal. Obviously we don't have control over what schools teach, therefore you must be reprimanding us about what we do in our own homes, and what our values are. When people think they're being told they are inadequate, they tend to get defensive. When people who are busting their butts to raise their children, forcibly pushing the limits of their own circumstances, feel they are being told they are doing a rotten job, that's personal.

 

 

A reminder about board rules

 

 

[Jean in Newcastle]

Honesty?

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 a spade 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 by calling me a spade for suggesting more education is needed concerning 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 board but at the terrible state of debt our country is in and most of you that replied act as if I was attacking you personally even though my statements clearly state I was talking about our nations education system, not you the reader.

 

What it looks like to me is not protecting your forum but rather you attack 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 more kids, not your kids, but more kids need to learn the power of compounding interest and many more money skills.

Who would have thought suggesting a man worth $14Billion 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 what again, 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 bash 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.

1. There are many public educators, college professors and business owners on this board. Many of them have posted on this thread to tell you repeatedly that a) this information is being taught and had been for a long time. Believe it or not, we can’t force our students to use a budget or invest. b). your financial information is flawed. An actual economic and financial professor has explained why.

 

2. We like clear thinking and communication. The expression to “ call a spade a spade†does not mean that I am calling you a shovel. It means that I am telling you the truth even though it offends you. Believe it or not but no one has sworn at you or done anything more insulting than to not accept everything you have said as gospel truth. People have told me if I have gotten things wrong. I have done my research and have thanked them for setting me straight. Many times people disagree with each other on this board. But there is a difference between expressing something as your opinion and trying to pass it off as fact. If you pass things off as “fact†then people will point out errors. No one is saying that you can’t be enthusiastic about your opinion of this investing method or use it or endorse it but you should get the math straight.

Edited December 12, 2017 by Jean in Newcastle

[luuknam]

I 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. 

 

 

I thought that buying stock meant buying part of a company. Which yes, companies become publicly traded in order to get more money, but once they're on the stock market (and plenty already are), we could technically all buy as much stock as we want, which would increase stock prices (unless supply were to increase), which of course would be a bubble if the companies aren't actually worth more (and if we all buy stock instead of spending money, they wouldn't be worth more, as they'd be selling fewer widgets because people are buying stock instead of widgets). So, even if we're all happy to buy into that bubble, the companies would decide to lay off workers because they don't need as many people to make widgets and they like to make as big a profit as possible, so keeping people on payroll who aren't needed is something they don't do, and at some point the unemployed people are going to have to sell their stock in order to survive, and, people being people, the other people will likely panic as stock prices start to drop, and then you've engineered a crash and quite probably a depression. 

 

Right?

Edited December 12, 2017 by luuknam

[Old School]

I 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.

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 how

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.

Edited December 12, 2017 by Old School

[creekland]

Firstly, I don’t understand people who say they don’t want money. Don’t you like to give money away?? Don’t you hear of people trying to raise money for tons of good causes all the time like I do?  I think it would be an incredible privelege to be able to pay for adoptions for families. And to give kids scholarships to schools. And to help immigrants get settled. And to help families with dire medical needs. Who can help, if not people with money?

 

Secondly, (and I have said nearly this identical thing on another thread that was started by a new poster and then turned nasty – this seems to be a pattern, for some reason) am I the only one who thinks several of the responses to the OP in this thread are kind of out of whack? Whether or not you agree, it seems to me like he was merely trying to initiate a discussion. Maybe you disliked his tone or disagreed with his points, but this barrage of rudeness is simply bizarre to me.

 

It’s ironic that we are attempting to be classical educators and teach our children the arts of logic and rhetoric, yet the minute a new poster steps into our little “club†with a point of view that we object to, or which offends us, or doesn’t fit with our worldview, we often don’t even listen to what the OP is saying and respond to the actual points made, but rather jump all over him or her, misconstrue his argument (e.g. responding to him as though he is advocating utterly selfish materialism), and then resort to ad hominem attacks (“troll!â€).

 

Am I the only one to see the irony in that? I can’t imagine it makes the homeschooling community look anything but foolish, rude, closed-minded, insular, and emotionally fragile.

 

Where do you see the bold/underlined part happening?  I went back and looked and don't see it in any post.  I only see folks like myself saying we don't care to amass huge amounts of money mainly because we spend it or give it to worthy causes.  Even in those posts it's still mentioned that enough is kept to make ends meet (including retirement needs).

 

I also see pretty much everyone listening to (reading) what the OP has said, then in our logical, classical way showing where there are massive holes in his reasoning.  We do this with each other too - not just newbies. ;)  It's not a JAWM thread and there is plenty to disagree with beyond the main points of saving (that everyone has agreed with).

 

Personally, I think it makes our homeschooling community look far more intelligent than many folks think we are.  We recognize that there is more to an issue than black and white points.  We have the experience to know things ARE being taught and the logic to be able to figure out why things being taught aren't always ingrained into what happens with those folks.  We know that stats being stated as fact aren't always real facts.  There's quite a bit involved showing the depth of the Hive's knowledge and ability.  Less intelligent folks look at what is written (any source) and simply agree to it.  ;)

[Rosie_0801]

I thought that buying stock meant buying part of a company. Which yes, companies become publicly traded in order to get more money, but once they're on the stock market (and plenty already are), we could technically all buy as much stock as we want, which would increase stock prices (unless supply were to increase), which of course would be a bubble if the companies aren't actually worth more (and if we all buy stock instead of spending money, they wouldn't be worth more, as they'd be selling fewer widgets because people are buying stock instead of widgets). So, even if we're all happy to buy into that bubble, the companies would decide to lay off workers because they don't need as many people to make widgets and they like to make as big a profit as possible, so keeping people on payroll who aren't needed is something they don't do, and at some point the unemployed people are going to have to sell their stock in order to survive, and, people being people, the other people will likely panic as stock prices start to drop, and then you've engineered a crash and quite probably a depression. 

 

Right?

 

From what I read yesterday, serious money is made on the stock market not by buying shares buy by buying options. 

[creekland]

You are the PhD in finance, you tell me how extreme levels of debt are good.

 

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.

[Bootsie]

I thought that buying stock meant buying part of a company. Which yes, companies become publicly traded in order to get more money, but once they're on the stock market (and plenty already are), we could technically all buy as much stock as we want, which would increase stock prices (unless supply were to increase), which of course would be a bubble if the companies aren't actually worth more (and if we all buy stock instead of spending money, they wouldn't be worth more, as they'd be selling fewer widgets because people are buying stock instead of widgets). So, even if we're all happy to buy into that bubble, the companies would decide to lay off workers because they don't need as many people to make widgets and they like to make as big a profit as possible, so keeping people on payroll who aren't needed is something they don't do, and at some point the unemployed people are going to have to sell their stock in order to survive, and, people being people, the other people will likely panic as stock prices start to drop, and then you've engineered a crash and quite probably a depression. 

 

Right?

The OP was suggesting a portfolio that was heavily invested in bonds (in addition to stocks) which are debt securities, which means someone is borrowing.

 

But, yes, if we invest by buying stock, we are becoming part owner of the company rather than lending money to the company.  Our return (in the long run) will be the growth of that company--so if no one is buying the company's products the growth will be zero.  In a nutshell, the average return for the average person in the long-run must equal the rate of growth in the economy.  The average person cannot receive an 8% return in the long run unless the economy is growing at an 8% rate, which I do not foresee happening over the next century.