Quote:
Originally Posted by mickey100
Someone posted making a certain profit on a stock market investment, but didn't account for taxes. So the point is, one may have to deduct 15 or 20%, or whatever bracket a person is in, to show the true earnings. And BTW, as any seasoned investor is aware, past performance is no guarantee of future earnings. Stock returns have varied greatly by decade. You may get lucky and be in a decade or two of hight earnings, or you may hit negative territory. Some investment gurus have said the says of double digit returns are a thing of the past, and we'll be lucky to get 6% on our investments over time. The thing is, no one has a crystal ball. If we did we would have bought Apple stock when it was $12/share.
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And hence the term "risk tolerance" Yes, my numbers were pre-tax, but I'd rather have 80% of something than 100% of nothing. Now, if someone doesn't anticipate the cash flow to pay the bond and interest yearly, has the $$$ right now, and might be tempted to spend it on something else, I'd pay it off too.