Quote:
Originally Posted by GregWeld
You are doing quite well! Congrats!!
Remember that your "big long term gains" are going to come with long time lines... Money doubles about every 7 to 10 years. That's IF you stay invested and you reinvest the dividends. It's all about COMPOUNDING.... 2 becomes 4 - 4 becomes 8 - 8 becomes 16 - 16 becomes 32 - 32 becomes 64....
Note how the last "doubling" is also the biggest?!?!?! 64 becomes 128
That's how ordinary earners become wealthy retirees. It's not rocket science. It's common thinking - Saving first versus pissing away every dime... and avoiding debt on high interest rate stuff like 20% credit cards.
I was discussing retirement and spending with a retired buddy yesterday. This guy never made 50K a year in his life -- and he's a millionaire just in stocks - not counting his house. They're thinking about selling the current house (paid 49K - selling for 850K and has been paid off for at least 10 years) and moving to a lower cost - less stressful area. The house they're looking at is twice as nice and half the cost. So their lifestyle will improve and they'll pocket some cash which will create even more retirement income. His biggest worry.... where they're going to take their Airstream next.
His biggest mistake -- investing in 10 year treasury bonds instead of stocks. He made the switch to stocks with my help about 15 years ago. He'd have 3 times the net worth now - if he'd have bought stocks 40 years ago instead of bonds... but regardless of that "mistake" the point is that he's pretty well set.
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Thanks! Thats very inspiring considering I have time on my side
. Compunding is awesome when it works in your own favor! Im not a big spender either so that helps quite a bit.
My next question is when interest rates rise where do I put my new investment money? Do I keep going into stocks or diversify a little more with CD's or something since they should be paying with higher interest rates?