by Dr Invest
I will repeat that we are in a DECLINING market. The market went onto life support in 2012. The glee of a robust economy has never really taken place. Yes, we have seen stock prices dramatically climb because speculation in a party thrown by the FED. How can you loose when the FED is paying for the tab. Why not order another round for everyone?
Like the story of the KING'S CLOTHES, wall street has taken up the mantra that everything is alright...all the time knowing that investors in stocks are vulnerable. Even in the face of a declining stock market, they continue to tell investors that this is only a temporary downturn and encourage investors to take the ride to the bottom.
Here is the problem. ALL the fundamentals are pointing downward. Sales are slowing, job growth is slowing, transportation is slowing, and this is happening not only in the U.S. market, but world-wide. Redefining how we measure job growth and GDP cannot hide the FACT that there is a real economic problem.
Meanwhile, the president declares his economic policies a success. The Democrats openly tout their policies to spend more and tax more and move us further into socialism. The Republicans don't seem to have a real plan, but at least they are seeking ways to reduce debt and not raise taxes further.
GET OUT!
Only your judgment can tell you what to do next. Hopefully you have a financial adviser who can guide you into successful investment. I suggest that you trust NO ONE. Go back to the year 2000 and look at the total of you investment portfolio in that year. (ie:$100,000) Look at how much you have added to that portfolio over the past 15 years and deduct it. (ie: value in Jan of 2016 ($145,000 minus what you added over the past 15 years $47,000 = $98,000) This means you actually lost money over the past 15 years. Because your current balance is $145,000 you believe that you are making money, no you are loosing money because your continued investment make the total appear larger than it really is.
If this is true of your account, you need to run away from your adviser as quickly as you can. I have talked about diminishing returns. This is when you have $100,000 and lose 30% in a downturn, leaving you with only $70,000. Even though their is a return of growth, your $70,000 may only grow 20% before the next downturn, leaving you with only $90,000 in your nest egg. If this kind of volatility repeats itself often enough, you investment will diminish instead of growing.
The suggestion is that you simply review your portfolio. There is nothing wrong with re-balancing your portfolio, but pay a financial counselor by the HOUR instead of giving him 2% of your portfolio whether it is growing or declining. And avoid front-end and rear-end fees or LOADS. Loaded funds is the way financial advisers get 5% of your total funds invested. Pay them by the hour to give your advice to invest your funds into VANGUARD and don't listen to their baloney. By the time you add the LOADS and fees of their LOADED FUNDS, you will see that they are taking 5% for their self and annually getting another 2% for just handling your investment accounts. In ten years they have take 20% of your total portfolio and in 20 years, 40%. (more or less)
(note: the above information is solely for entertainment purposes and must not be used in ANY WAY as financial advice.)
