I am a conservative investor (always have been) and am looking to retire in the next 10 years. Realistically, I will need an ROI of at least 5% per year over the next 10 years on my non-real estate investments to achieve this dream, even assuming today's current rate of inflation.
I am extremely concerned about how to achieve this, without incurring some major risk. My feeling is that the equity markets are out of control and totally disconnected from the domestic and world economic outlooks. The bond markets are at very scary levels (how much lower can interest rates go? Due for a major correction, IMO). Commodities are at scary lofty levels as well. And the world economy is on tenderhooks as well; we're one major European bank failure away from calamity, IMO. Throw in the debt issues, high worldwide unemployment, instability in the Middle East, and I am on high alert. CD's and Money markets pay crap too, and certainly are not keeping up with the rate of inflation.
Here in NY, real inflation (forget this bullshit CPI statistic) is somewhere around 7-8% for me. This due to rampant increases in food, electric utility, home heating oil, health insurance increases, tuition increases, gasoline, local taxes, etc., etc., etc.
So, without incurring major risk that may be unrecoverable in a 10 year time frame, where would you look to invest for the next year, 5 years, 10 years, with an eye out to achieving an average ROI of 5% over this 10 year period? Given my gloom and doom outlook, am I better off investing in a longer-term CD, to just minimize my real loss, and preserve as much capital as possible?
I would greatly appreciate any serious commentary on the above. I really don't know where to invest my money any more.
I am sinking almost all of my money in GLRE. I think Einhorn is going to be the voice of the market for decades to come. No one will ever replace Buffett but Einhorn is the next best thing.
I am sinking almost all of my money in GLRE. I think Einhorn is going to be the voice of the market for decades to come. No one will ever replace Buffett but Einhorn is the next best thing.
I am a conservative investor (always have been) and am looking to retire in the next 10 years. Realistically, I will need an ROI of at least 5% per year over the next 10 years on my non-real estate investments to achieve this dream, even assuming today's current rate of inflation.
I am extremely concerned about how to achieve this, without incurring some major risk. My feeling is that the equity markets are out of control and totally disconnected from the domestic and world economic outlooks. The bond markets are at very scary levels (how much lower can interest rates go? Due for a major correction, IMO). Commodities are at scary lofty levels as well. And the world economy is on tenderhooks as well; we're one major European bank failure away from calamity, IMO. Throw in the debt issues, high worldwide unemployment, instability in the Middle East, and I am on high alert. CD's and Money markets pay crap too, and certainly are not keeping up with the rate of inflation.
Here in NY, real inflation (forget this bullshit CPI statistic) is somewhere around 7-8% for me. This due to rampant increases in food, electric utility, home heating oil, health insurance increases, tuition increases, gasoline, local taxes, etc., etc., etc.
So, without incurring major risk that may be unrecoverable in a 10 year time frame, where would you look to invest for the next year, 5 years, 10 years, with an eye out to achieving an average ROI of 5% over this 10 year period? Given my gloom and doom outlook, am I better off investing in a longer-term CD, to just minimize my real loss, and preserve as much capital as possible?
I would greatly appreciate any serious commentary on the above. I really don't know where to invest my money any more.
just curious, where is your money now? Are you just sitting in cash? And if so, for how long have you been there?
just curious, where is your money now? Are you just sitting in cash? And if so, for how long have you been there?
I took profits about 6 months before the credit crisis hit (pat on back), but I've been sitting mostly in some 3-4 % CD's and some GIC's since then (yeah, missed large equity and bond run-ups, except for some VZ and AT&T stock I kept). The CD's have mostly matured this year, although some fall due early in 2013. Took ZERO hit during credit crisis, and have had low returns since then. So, yeah, sitting in cash currently.
I took profits about 6 months before the credit crisis hit (pat on back), but I've been sitting mostly in some 3-4 % CD's and some GIC's since then (yeah, missed large equity and bond run-ups, except for some VZ and AT&T stock I kept). The CD's have mostly matured this year, although some fall due early in 2013. Took ZERO hit during credit crisis, and have had low returns since then. So, yeah, sitting in cash currently.
you and me and a lot of others. No good place to go right now. I have plenty of stocks but quit adding at 1306. I buy a little GLD on dips, but I'm content to sit in cash for a while, but will actively buy any dips in the S&P. Not sure where all this doom and gloom is coming from, P/Es are low, no inflation in site, fed is not tight, only thing is, it's been a long run up with no correction. I sold all the bonds I was not using for income, and now have no where to go. 6% is not an unreasonable expectation. If you're 100% flat I would DCA into a broad based index fund, you're going to need stocks to get 6%, but go slow and easy, just a little each month, if the correction comes you can go all in.
