| | | Hi Kim,
I do believe that asset diversification is the best plan.
That being said, there are times that different assets are more affordable and thus require a long term view.
That is one huge mouth full as it has taken me time to learn that the hard way.
Stocks are my largest piece of that asset diversification. It MUST be said that that piece of the pie breathe's in and breathe's out to borrow cheif's brilliant analogy. They go up and they go down, but over the long run,they keep pace with inflation of currency debasement. That is why it is so important to look at a company's balance sheet and those depreciated assets that last for decades are a great set up for dividend paying stocks. So with a longer time horizon there are sectors that go through tough times. Semi's in 2000 to 2003. Msft,Amat,Lrcx,Csco - all multi baggers today after a big decline. Banks in 2008 JPM down big lately - yet still a multibagger after a 20% decline of late and paying a big fat dividend. Energy stocks the last 2 years and especially now, CVX, XOM, KMI. All of us will be using gas,diesel in auto's, plastics in everything, natural gas for heating, cooking and electricity generation, not to mention export to Canada and Mexico. Watch for the sectors that are out of favor and pounce on them during the inevitable general market selloff - LIKE NOW! Stocks are 50% of my assets.
Cash and reserve money that allow some leverage in stocks, but not much. It just adds to the dividend yield if you sell a put our two way out in time or a covered call if a stock is getting a bit high vs monthly charts. 20-25% - that breathes also. I don't do bonds. At these low rates its a potential value trap PERIOD ! What I do have is a social security plan that I view as both for myself and for my wife as an annuity plan. We're putting it off til we hit 70. Both of us are within 2 years of that momentous date. Highly recommend spending 40 dollars and go to Maximize my social security.com - see how you can build an annuity for the rest of your life.
Realestate 25 percent: I have two homes one I bought as I worked and won I bought after my parents passed. I also have agricultural land. Most of it wooded with utility pole size trees on it. A heirloom from my parents and their vision and discipline of a very long term asset held with love and pride. Some that grows crops on that Dairy farmers utilize.
When my cash or stocks get too big, I buy more land to balance it out. It takes selling of stock and cash so that balances out the two that breathe the most.
Land holdings I want to build more of. They aren't making any more of it and it will hold its value most of the times. That being said there is a time to buy land or homes. Recessions are when values get the best. I never buy land with the idea of selling it. It is always a long term buy and hold for me.
I plan on building my collection of old cars as a great place to park money. But over long time periods,that's a touchy plan. There are some many wonderfully restored Model A and T's that you can but from estates for less than what the cost of the paint job was - its not even funny. I suspect that as my generation gets old and we start dieing off like the great generation has, this too will happen with the Muscle Car generation - Maybe not BUT MAYBE!! So buy the cars that give you joy owning driving and of course fixing - they all deteriorate sitting still! Cars are in my life my ART Collection - that's just me.
I've not gotten to this point, but there is hope I can get to frivolous waste of money. In my life that will be the buying of a boat and parking it in a marina in Venice Louisiana. One of the greatest fisheries in the world and arguably the best in the lower 48 states. Fishing and more importantly adventuring on water is a thrilling thing to do. Add to that pulling out big game fish from the water and you have memories of a lifetime. I've caught sailfish,bill fish,tuna,and halibut all bigger than myself - it is an adrenaline rush. I 've had the pleasure of knowing wealthy people who could afford such expenses and there was no reason for both of us to have one so I rode along and did the mechanicing and cleaning up!
I look at the good things in life. I don't spend much time worrying about the end game. I just hope to grow old and chase the things in life that I find worthy of my time.
There are so many wonderful things to chase - its all I can worry about.
I'm horribly optimistic. When I get in trouble or overly stressed I just have to laugh at myself for having gotten into the mess.
Then I suck it up - declare it to be a longer term resolution achievement and I never bet against the US.
We are the most decent country in the world.
We achieve great things and we are generous - we must be - we have the greatest country and the greatest people and the greatest wealth.
We don't knowingly cheat or lie and are an example of what other people should strive to be. That's not an absolute claim , but it is a general claim.
There are those lessor folks who make claims on our accumulations and achievements.
They'll always be those losers - they are noise in a world of greater people, doing greater things.
ALL MY HUMBLE OPINION!
Bob |
|
