Author Topic: Ready to invest, but confused and paranoid  (Read 2819 times)

jmalevic

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Ready to invest, but confused and paranoid
« on: April 01, 2015, 03:36:40 AM »
Hi all,
Although Iíve been reading this blog for more than six months, this is my first post here.
Iíve been active in daytrading roughly ten years ago and lost most of my investments through false confidence and lack of knowledge, I actually can now see that it was more like gambling then daytrading.
Now that I saved my losses and know about etfís thanks to this blog, Iím ready to invest the mrmoneymustache way.
My concern is that Iím so paranoid of losing my savings again, Iím extremely cautious now that the market is at the peak of the supercycle.
Did anyone read the posts from Jess Felder the end of the baby boom investing: http://jessefelder.tumblr.com/post/114539830195/how-the-baby-boomers-have-blown-up-the-stock and the upcoming lost decade: http://jessefelder.tumblr.com/post/109242478660/heres-why-investors-are-now-facing-another-lost
Adding to it the overpriced Ė low performance bond market I donít know what I should do.

Am I being too cautious, paranoid doom monger?
I want to FIRE in less than ten years, but am not sure if that is possible with the upcoming lost decade, low market performance that will probably soon come.
Any thoughts?

Frankies Girl

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Re: Ready to invest, but confused and paranoid
« Reply #1 on: April 01, 2015, 03:54:26 AM »
Stop reading the investing news crap if you're unable to see that it's all garbage/click bait. Supercycle? overpriced? "lost decade" OMG.... so much noise. Just stop. You're not investing for the next year, or even the next 5 years... you want to buy and hold for the long haul, and short term drops/volatility should be seen as buying opportunities. The market ALWAYS trends upwards if you're looking big picture. What you're doing is market timing based off of the doom and gloom junk you've been fed. We're due for a correction or even a crash right? But guess what? The market will recover and grow, and as long as you were invested and leave your money in the market (and don't panic and lock in the losses), it will recover and grow too.

The research shows that lump sum investing works out for the best, but if you really can't stomach a drop in the beginning, dollar cost averaging is a perfectly legitimate way to get invested and still feel like you're playing it "safe."

If you are wanting a basic and easy way to invest, go for index investing.

http://jlcollinsnh.com/stock-series/
^read this if you haven't already.

Then read these below:
http://www.bogleheads.org/wiki/Investment_policy_statement
http://www.bogleheads.org/wiki/Asset_allocation
http://www.bogleheads.org/wiki/Lazy_portfolios

But seriously, stay away from the "professional" financial blog/news stuff. I have no idea who this Jesse Felder guy is, and could care less about his "expertise" or opinion. Because that is all he has - an opinion. There are plenty of big financial gurus out there predicting all kinds of things and 99.9% are wrong more than half the time anyway. Unless you can read that junk purely for entertainment and laugh about the silliness, you need to stop reading it all together.

« Last Edit: April 01, 2015, 03:56:19 AM by Frankies Girl »

jmalevic

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Re: Ready to invest, but confused and paranoid
« Reply #2 on: April 01, 2015, 04:54:13 AM »
Thanks Frankies Girl for clearing up the junk :)
I'm definitelly going for indexing, I guess I'm way overthinking things and letting outside crap news and opinions get to me.
Time to stop listening to the junk.


Retired To Win

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Re: Ready to invest, but confused and paranoid
« Reply #3 on: April 01, 2015, 06:46:29 AM »
Thanks Frankies Girl for clearing up the junk :)
I'm definitelly going for indexing, I guess I'm way overthinking things and letting outside crap news and opinions get to me.
Time to stop listening to the junk.

Absolutely.  I stopped watching the business news channels years ago.  Cancelled my subscriptions to the Wall Street Journal and Investors Business Daily.  I actually did better with my investing.  And I stressed a whole lot less.

As Frankie's Girl already pointed out, you are not investing for the next year.

Good luck.

ShoulderThingThatGoesUp

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Re: Ready to invest, but confused and paranoid
« Reply #4 on: April 01, 2015, 07:03:32 AM »
I have Schwab rather than Vanguard, and I don't pay attention to investment news at all anymore. I just put excess cash into SCHB. Way less stress that way.

humblefi

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Re: Ready to invest, but confused and paranoid
« Reply #5 on: April 01, 2015, 07:07:40 AM »
>> I want to FIRE in less than ten years,
A lot of the fear and paranoia can come from Uncertainty of meeting the goal. In your case, the goal seems to be to FIRE in 10 years.
FIRE usually comprises of many sub goals...each person's FI plan can be totally unique to him or her. I would advise you to break your FIRE goal into sub-goals and attach a dollar sign for each item. And only then decide which investment vehicles can be used for each goal. For ex, my plan is like this: http://humblefi.com/category/financial-independence/financial-independence-to-me/. You can use the forum to fine tune your plan.

Once I developed my FI plan and had a dollar (cost) sign attached to each goal, it has become a lot lot easier for me to ignore doomsday articles, ignore all the negative emotions like fear and paranoia, easier to ignore keeping-up-with-the-Joneses, etc. The FIRE plan is a big time focusing aid for the mind. Try it and see if it works for you.

Hope that helps.