A weekly thread to discuss financial matters - from personal all the way up to global.
Ground Rules
- Remember that we're all just Internet randos. Don't bet your life savings on a hot tip from this thread.
- Keep culture war in the culture war thread. Yes, global events may impact our personal finances, but that does not mean we have to incessantly harp on culture war aspects here. If you are going to discuss it, please stick to the practical impacts of it on an individual level.
- Be kind. Remember that everyone here comes from different circumstances. We all have different resources available and different risk tolerances.
- Don't let the perfect be the enemy of the good. Better is better. Celebrate people when they take a step up and work to move their finances in the right direction. Don't flame out because they haven't followed what you consider the optimal path. Everybody has to start somewhere.
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Notes -
Perhaps this person would consider something along these lines: Suppose there is $100,000 to invest. You put roughly 2/3 of that into a 10-year US treasury, or whatever the amount is that means you will get $100,000 back at the end. You put the remainder into a broad stock market index fund.
The psychological selling point of this strategy is that no matter what happens in the stock market, you are more or less guaranteed not to lose any principal. Obviously this is a questionable strategy if the goal is to maximize your returns. But for those who are extremely risk averse, it might be appealing and the expected result is arguably quite a bit better than if you'd put everything into a high yield savings account.
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