I get a shocking amount of PM's asking about investing. Most of which I can't really answer - because they're asking "what should I buy". As you all know - I don't recommend what to buy - and this thread is not about what to buy or what to sell.... it's about YOU GUYS learning some basics so that you're comfortable making these decisions on your own.
But the tickle for this post was the usual --- "with the market down.. shouldn't I wait to add more to my 401K?"
I think most are shocked when I respond -- HELL NO! ADD MORE!
Is this a "contrarian" view? No. It's a long term view with history on my side... and the knowledge that the market will go higher and if you buy "now" (whenever that is) 10 years from now it will be higher.
So the last month or so has been real poopie.... and this always gets people wanting to coast or back off the market. The exact wrong thing to do! Think of a period like this as suddenly seeing that '69 Camaro you always wanted that the guy was asking 100K for -- is now 70K.... do you wait for the guy to drop to 65? Chances are - someone smarter than you snaps it up and you miss out. The stock market is that way. The prices drop -- drop some more -- and you wait for ever better prices..... only to miss the day or two where the market snaps back and runs 5% -- then everyone feels good and piles in. Don't be "that guy". Save your dough -- and plow ahead... let your IRA/401 keep investing. And if you're saving on your own - set a date or amount - and every first of the month -- or every $500 -- INVEST IT. High or low. You'll buy more shares when it's low - and fewer when it's high... so your AVERAGE cost will smooth out over time.
Wealthy people get even more wealthy because they step in front of that moving train -- they'll buy buildings or businesses - or make investments - at bargain prices. When things turn around - they make even more money. Be like the wealthy and you'll be glad you did.
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