Any 50yo+ with retirement savings less than $2million?

[Anonymous]

Anonymous wrote:People with MORE than $2 million - stop posting. This thread is not for you.

does that include if the $2mil+ is combined with spouse?

I have $1.4mil at 53; DH has $1.3mil at 59.

[Anonymous]

Is it limited to "retirement accounts" or any assets that can generate retirement income, e.g., investment properties?
The title isn't clear at all so it's garbage in and garbage out for the whole thread.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

unicorn honest post on this forum, thanks

I'm the pp you responded to. My current advice to anyone who'd listen - kids, nephew/nieces, etc. - is to invest 90% of their investible money into S&P, nasdaq and small cap indexes - 25% each, 15% in international and keep the remaining 10% for speculative investments. Of course, I don't follow that rule myself. Cognitive dissonance, I suppose.

This is exactly what I advise. I don't follow it either. I think it's just the historical effect of prior investments and not wanting to take the definitive action to rebalance so much at any given moment (both for psychological and tax reasons). But I have drifted towards this more over time.

Agree. One regret I have is deciding to balance out my assets by investing more in bonds. I wish I had stuck to my stocks. Now, my plan is to keep the bonds but invest going forward in mostly stocks and get the stock heavy asset allocation I had before.

[Anonymous]

OP, know that majority of Americans (80%) have less than 250k retirement savings. This data is from several sources. DCUM shouldn’t be your main point of reference.

What you need to do is start reading about retirement lifestyle and financial resources. It really all boils down to what kind of lifestyle you envision of your retirement. The first decade or 15 years of your retirement (assuming you’re retiring in early 60’s) is the most likely you’ll spend.

After that, your spending habit will decrease because you will be in your “slow go” years. There’s no one size fits all.

Consult a financial advisor and discuss your retirement goals. Do you plan to do a ton of traveling? Do you intend to join a golf club? Do you want to downsize and move to a lower or higher cost of living area? These are the factors you need to base your retirement income, not how much the DCUM members have invested .

[Anonymous]

Most civil service people who are GS-7/9 or below will not have that much. And anyone who started after around 1986 is on FERS, not CSRS. FERS has a very small pension component, mostly it relies on TSP (which is like a 401k). CSRS was the gold plated civil service pension.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m 48 and have $1.1 million. I doubt it’s going to double in the next 18 months.

Not worried about it though. I’ll also have a pension of $75k a year.

That’s a really good pension! Military?

DP
I'm 52 and just retired from teaching. I have two pensions that provide ~$72k a year and I opted for the spousal survival benefit with one of them.

Are you eligible for Social Security payments on those years worked?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

unicorn honest post on this forum, thanks

I'm the pp you responded to. My current advice to anyone who'd listen - kids, nephew/nieces, etc. - is to invest 90% of their investible money into S&P, nasdaq and small cap indexes - 25% each, 15% in international and keep the remaining 10% for speculative investments. Of course, I don't follow that rule myself. Cognitive dissonance, I suppose.

This is still a speculative portfolio tbh. You’re betting on small cap and that tech will continue to outperform. The true passive portfolio is the Buffett portfolio – 90% S&P index and 10% short-term Treasuries (aka cash).

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

unicorn honest post on this forum, thanks

I'm the pp you responded to. My current advice to anyone who'd listen - kids, nephew/nieces, etc. - is to invest 90% of their investible money into S&P, nasdaq and small cap indexes - 25% each, 15% in international and keep the remaining 10% for speculative investments. Of course, I don't follow that rule myself. Cognitive dissonance, I suppose.

This is still a speculative portfolio tbh. You’re betting on small cap and that tech will continue to outperform. The true passive portfolio is the Buffett portfolio – 90% S&P index and 10% short-term Treasuries (aka cash).

Except that's not what Buffett actually does, just what he says he will leave in place for his wife who is not interested in finance. Also, the S&P500 is a bet on the US (even though those companies have international ties of course) not true diversification. An economist would say the ideal passive portfolio is diversification as much as possible at equivalent weights of every asset class in the world--but that's not really possible.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m 48 and have $1.1 million. I doubt it’s going to double in the next 18 months.

Not worried about it though. I’ll also have a pension of $75k a year.

That’s a really good pension! Military?

DP
I'm 52 and just retired from teaching. I have two pensions that provide ~$72k a year and I opted for the spousal survival benefit with one of them.

Are you eligible for Social Security payments on those years worked?

DP but I believe most social security is negated with Teacher Pensions

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

You’re making a straw man argument. No one is saying to invest all your money in relatively green, growing companies, like Apple and Starbucks in 2000 were.

Apple in 2013 was established, 5 years after the iPhone debuted in 2008. Ditto Amazon. Ditto Costco. Apple has gone up almost 10x what is was 10 years ago; Amazon has increased by 7x; Costco has increased by 5x. The S&P 500 hasn’t even tripled over the same time. Investing in FAANG or the Magnificent Seven over the S&P is common sense now. These large corporations aren’t going anywhere.

From Charlie Munger:

https://www.yapss.com/amp/collection-charlie-munger-262-charlie-munger-s-view-on-investing-in-just-three-stocks

“If you take the Mungers, I care about the Mungers. The Mungers have three stocks. We have a block of Berkshire, we have a block of Costco, we have a block of Li Lu’s Fund, and the rest is dribs and drabs.

And is three stocks enough? What are the chances that Costco’s going to fail? What are the chances that Berkshire Hathaway’s going to fail? What are the chances that Li Lu’s portfolio in China is going to fail? The chances that any one of those things happening is almost zero, the chances that all three of them are going to fail.

If you’re a know-nothing investor of course you’re going to own the average, but if you’re not a know-nothing investor, if you’re actually capable of figuring out something that will work better, you’re just hurting yourselves looking for 50 when three will suffice. Hell, one will suffice if you do it right. One. If you have one cinch, what else do you need in life. And so the whole idea that the ‘know-something’ investor needs a lot of diversification.”

[Anonymous]

not there yet but i will be in a few years.

40s. I have $300K in TSP + tracking for a FERS pension as i am a fed with 9 years service. I spent my 20s working on campaigns which didnt offer retirement and set me back.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

unicorn honest post on this forum, thanks

I'm the pp you responded to. My current advice to anyone who'd listen - kids, nephew/nieces, etc. - is to invest 90% of their investible money into S&P, nasdaq and small cap indexes - 25% each, 15% in international and keep the remaining 10% for speculative investments. Of course, I don't follow that rule myself. Cognitive dissonance, I suppose.

This is still a speculative portfolio tbh. You’re betting on small cap and that tech will continue to outperform. The true passive portfolio is the Buffett portfolio – 90% S&P index and 10% short-term Treasuries (aka cash).

If I had Buffet kinda money, even stuffing it in a mattress(es) would be a great investment strategy. His wife and at least a couple of generations won't run out of cash with that approach. In reality, he's set up trusts and non-profits that will be sure to employ pretty much anyone near and dear to him for the rest of their lives so they can live in extreme comfort.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

You’re making a straw man argument. No one is saying to invest all your money in relatively green, growing companies, like Apple and Starbucks in 2000 were.

Apple in 2013 was established, 5 years after the iPhone debuted in 2008. Ditto Amazon. Ditto Costco. Apple has gone up almost 10x what is was 10 years ago; Amazon has increased by 7x; Costco has increased by 5x. The S&P 500 hasn’t even tripled over the same time. Investing in FAANG or the Magnificent Seven over the S&P is common sense now. These large corporations aren’t going anywhere.

From Charlie Munger:

https://www.yapss.com/amp/collection-charlie-munger-262-charlie-munger-s-view-on-investing-in-just-three-stocks

“If you take the Mungers, I care about the Mungers. The Mungers have three stocks. We have a block of Berkshire, we have a block of Costco, we have a block of Li Lu’s Fund, and the rest is dribs and drabs.

And is three stocks enough? What are the chances that Costco’s going to fail? What are the chances that Berkshire Hathaway’s going to fail? What are the chances that Li Lu’s portfolio in China is going to fail? The chances that any one of those things happening is almost zero, the chances that all three of them are going to fail.

If you’re a know-nothing investor of course you’re going to own the average, but if you’re not a know-nothing investor, if you’re actually capable of figuring out something that will work better, you’re just hurting yourselves looking for 50 when three will suffice. Hell, one will suffice if you do it right. One. If you have one cinch, what else do you need in life. And so the whole idea that the ‘know-something’ investor needs a lot of diversification.”

You are making my point. Munger's choices sound great in hindsight. How many Mungers have we not heard about because their 3 picks crashed and burned and they lost their shirt? Most people that pick stocks are not know-nothing investors. A lot of them are reasonably educated and know what they are doing. They just didn't pick the right stocks.

Let's try an exercise.. What stocks today are the equivalent of Amazon, Apple and Costco 10 years ago?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

You’re making a straw man argument. No one is saying to invest all your money in relatively green, growing companies, like Apple and Starbucks in 2000 were.

Apple in 2013 was established, 5 years after the iPhone debuted in 2008. Ditto Amazon. Ditto Costco. Apple has gone up almost 10x what is was 10 years ago; Amazon has increased by 7x; Costco has increased by 5x. The S&P 500 hasn’t even tripled over the same time. Investing in FAANG or the Magnificent Seven over the S&P is common sense now. These large corporations aren’t going anywhere.

From Charlie Munger:

https://www.yapss.com/amp/collection-charlie-munger-262-charlie-munger-s-view-on-investing-in-just-three-stocks

“If you take the Mungers, I care about the Mungers. The Mungers have three stocks. We have a block of Berkshire, we have a block of Costco, we have a block of Li Lu’s Fund, and the rest is dribs and drabs.

And is three stocks enough? What are the chances that Costco’s going to fail? What are the chances that Berkshire Hathaway’s going to fail? What are the chances that Li Lu’s portfolio in China is going to fail? The chances that any one of those things happening is almost zero, the chances that all three of them are going to fail.

If you’re a know-nothing investor of course you’re going to own the average, but if you’re not a know-nothing investor, if you’re actually capable of figuring out something that will work better, you’re just hurting yourselves looking for 50 when three will suffice. Hell, one will suffice if you do it right. One. If you have one cinch, what else do you need in life. And so the whole idea that the ‘know-something’ investor needs a lot of diversification.”

You are making my point. Munger's choices sound great in hindsight. How many Mungers have we not heard about because their 3 picks crashed and burned and they lost their shirt? Most people that pick stocks are not know-nothing investors. A lot of them are reasonably educated and know what they are doing. They just didn't pick the right stocks.

Let's try an exercise.. What stocks today are the equivalent of Amazon, Apple and Costco 10 years ago?

Amazon was $2.50 a share 20 years ago. Apple was 37 Cents. Costco was around $36. At a certain point you have to realize that these companies are not going anywhere and are going to continue to grow. Apple is going to be the tip of the spear in tech in 10 years like it always has. If anyone gets in their way they’ll just use a few billion and buy them before they become a threat. Amazon and Costco have moats and aren’t going anywhere.

The kind of financial advice you’re giving is outmoded and was relevant in a time where companies like Apple didn’t exist. Sears Roebuck didn’t have factories and customers in India and China. 20th Century financial advice doesn’t bear as much weight in this new world of behemoth multinational corporations like Apple.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My wife works at a financial profit and I work at the SEC with a 470K in combined income. Our 3M home in Langley is already paid off. We have about 10M in savings because I purchased Apple stock in 2001. We’re very lucky. I am 56 and DW is 38. I am going to retire soon.

Love this story! A close friend’s colleague bought Apple stock in the late 90s because her kid liked the Apple symbol! Instead of buying a new iPhone in 2015ish I invested that amount in stock and it’s up over 500%. Other than that I have a pension coming plus $350k in a 401k and $50k in multiple brokerage accounts. I 50 now, no kids, and want enough to be comfortable at retirement but know too many people who, sadly, passed at or before retirement to deprive myself today.

This is an interesting lesson for newbies and older folks like my self. 63. I was cautious in my early 30s as I was constructing my investment portfolio, picked some dividend payers and a few growth stocks but mostly diversified mutual funds. So I really never hit a home run on my stock investments. And while my stock mutual funds have kept up with the market, no clear out performance. But most of us don't have the time or inclination like Charlie Munger to do the research to pick quality firms. But individual stocks clearly have the ability to out perform, or in some cases, one stock can make you financially independent. Like Apple, NVDA, AVGO, XOM if bought years ago, etc.... Amazing stories of wealth building with stocks.

The example you quote from PP (Apple) is an example of luck and survivor bias. I still remember the day, September of 2000, I walked into the Starbucks near the World Bank, saw someone on TV yakking about bad news for stocks, went back to the office and bought 150 shares of Apple and 100 shares of Starbucks. With stock splits and DRIP, those purchases have grown to about 9000 Apple and 1000 Starbucks shares, about 20% of my portfolio. Things could have very easily gone South. I just got lucky. Also, what I didn't (and most people don't) keep track of are the many losers I've had over time and the opportunity cost of holding cash hoping to time the market. All things considered, I would likely have been at the same level of net worth if I had diligently invested all my savings in index funds over time instead of picking stocks.

You’re making a straw man argument. No one is saying to invest all your money in relatively green, growing companies, like Apple and Starbucks in 2000 were.

Apple in 2013 was established, 5 years after the iPhone debuted in 2008. Ditto Amazon. Ditto Costco. Apple has gone up almost 10x what is was 10 years ago; Amazon has increased by 7x; Costco has increased by 5x. The S&P 500 hasn’t even tripled over the same time. Investing in FAANG or the Magnificent Seven over the S&P is common sense now. These large corporations aren’t going anywhere.

From Charlie Munger:

https://www.yapss.com/amp/collection-charlie-munger-262-charlie-munger-s-view-on-investing-in-just-three-stocks

“If you take the Mungers, I care about the Mungers. The Mungers have three stocks. We have a block of Berkshire, we have a block of Costco, we have a block of Li Lu’s Fund, and the rest is dribs and drabs.

And is three stocks enough? What are the chances that Costco’s going to fail? What are the chances that Berkshire Hathaway’s going to fail? What are the chances that Li Lu’s portfolio in China is going to fail? The chances that any one of those things happening is almost zero, the chances that all three of them are going to fail.

If you’re a know-nothing investor of course you’re going to own the average, but if you’re not a know-nothing investor, if you’re actually capable of figuring out something that will work better, you’re just hurting yourselves looking for 50 when three will suffice. Hell, one will suffice if you do it right. One. If you have one cinch, what else do you need in life. And so the whole idea that the ‘know-something’ investor needs a lot of diversification.”

You are making my point. Munger's choices sound great in hindsight. How many Mungers have we not heard about because their 3 picks crashed and burned and they lost their shirt? Most people that pick stocks are not know-nothing investors. A lot of them are reasonably educated and know what they are doing. They just didn't pick the right stocks.

Let's try an exercise.. What stocks today are the equivalent of Amazon, Apple and Costco 10 years ago?

Amazon was $2.50 a share 20 years ago. Apple was 37 Cents. Costco was around $36. At a certain point you have to realize that these companies are not going anywhere and are going to continue to grow. Apple is going to be the tip of the spear in tech in 10 years like it always has. If anyone gets in their way they’ll just use a few billion and buy them before they become a threat. Amazon and Costco have moats and aren’t going anywhere.

The kind of financial advice you’re giving is outmoded and was relevant in a time where companies like Apple didn’t exist. Sears Roebuck didn’t have factories and customers in India and China. 20th Century financial advice doesn’t bear as much weight in this new world of behemoth multinational corporations like Apple.

So it’s different this time? Lol. Good luck with that long term. I’m not saying any of these companies will crash and burn but to have a non diversified porttfolio like this is taking a huge risk. It might pay off, but it’s s huge risk.