Keep CD's "out of your retirement portfolio".
Quotes are used because I don't mean 100% out.

Look back, since 1960, what was the average recovery time from a dip in the S&P 500?
~ two years.
So put a couple years of annual expenditures in CD's, Money Markets, ST Bonds, etc., and INVEST THE REST.

History does not promise Tomorrow, but 60 years, or 40 years, or 20 years give me a lot of comfort. :MOJE_whot::MOJE_whot:

I don't know about anyone else, but i love paying long term capital gains. . because I am paying a reduced rate from income, and capital gains means that I am getting wealthier, unlike having capital losses which makes me much poorer, and less able to afford nice things.

some people just like to whine about success

To some extent it is an emotional thing. When we did our taxes and were accumulating 1099's had no idea our capital gain distributions would be as high as they were.

Electric lithium golf cart is my main vehicle rather than filling up $80 of gas a week in a premium gas car.
Don't but grocery items that are now twice the price.
Buy chicken and pork in bulk at Costco
Travel less
Not watching regular TV anymore and all the lousy commercials

sure, but its negative for success, which if you examine it on an emotional level, is counter productive, and keeps you down and is a subconscious block to successful investing.

Simply stated: the difference in mentality of wealth maximization vs tax/expense minimization. wholly opposite mentalities, and you get what you subconsciously want.

to be successful in investing, you have to celebrate success, not demean it. . . its all in the psychology to keep going forward. .

My guiding statement came from T Boone Pickins, who had a $20M gain, and thought about selling, but waited to sell when the investment became eligible for long term capital gains. When that time came, the profit was gone. Taxes should seldom enter the gain selling decision. Taxes are a by product of success. . .

likewise, if you want to not pay taxes on gains, which is a tax minimization strategy, you need to pay more attention to statements, and then sell losers to offset gains prior to year end. . .

I have more examples, but I am still on my fixed income, my salary

Cash is king. My son needed to establish credit. He got a credit card, then paid in full every month without paying any interest. Any debt is bad. Just my opinion.

Having access to credit good, not many can afford to buy a car or home with cash.

The problem is when they do not use credit responsibly.

99.9 % of me uses a cash back credit card, pay off every month and collect the credits.

A lot of $$$$$ is left on the table not paying with a credit card, it leaves a paper trail to check past expenses and did I mention?
"The build up of credits on Charge Cards is not taxable"

Also, how did the younger generation graduate from school, and never learn how to balance a check book??

Or can't tell time from a numbered clock, only from a digital clock?
Don't laugh, this is real.

Blame the schools which also for some reason do not teach personal finance.

My mother could not balance a checkbook. She completely did not understand how she did not have money in the account when she wrote a check, because she called the bank and asked what her balance was. The idea was that she had written another check that had not yet cleared, and the reason her account was overdrawn was the two checks finally cleared.

No amount of discussion could explain it to her. I don't think it is just the "youngsters".

But, I will readily agree our educational system has gone down the drain. It used to be that countries would send representatives here to see how ours worked. Now they laugh at us.

I disagree with the crowd that wants to throw out our education system. I just want to fire all/any ad administrators that are in it for the money. I don't have a solution, I hope someone comes up with one. Education is important. I have heard very few suggestions on how to fix it.

Some of them don't know what a Princess Phone is either - big deal. Why should kids learn how to use dead or almost dead processes?
I have a check book. I don't think I've written a check in 6 months - it's all done through bill pay systems that keep track of in/out/pending/cleared. etc. as part of their service. I'm very aware of what I spend and mentally check things off when items clear, but haven't formally balanced anything in years.

The plummeting stock market should be more concerning to most people

Things change but how do allow our kids to graduate school and not know about how to handle their finances?

oiginally Posted by retiredguy123 View Post
In my opinion, interest rates, including CDs, will remain very low for a long period of time. The goal is to stimulate the economy and encourage borrowing, .................................................. .....
Bingo.

With inflation ramping up the only tool the Fed has to throttle back inflation is to increase interest rates (monetary policy) at the same time the government in inclined for political reasons to spend more money (fiscal policy) that added money fuels inflation. the Fed isn't screwing with anybody it's trying to put the economy back on an even keel, a balanced portfolio ,adjusted for the individual, a lifestyle based on realistic view of your assets will go a long way to avoid personnel financial disaster

hyperinflation is usually preceded with a highly devalued currency, or very weak currency in a highly connected world. given the USD strength, not quite sure that hyper inflation is in the cards, given that the US has the most resilient economy in the world due to large diversified and creative environment.

granted that the stock market valuations will return to earth, which is NOT the economy, and the sh1tcos with stupid valuations versus highly negative cash flows and insolvencies should and will crash, (CVNA is one that is the poster child today) the market will correct and then inflation will drop back to 2-4%.

But CDs are repackaged T bonds with the banks taking a cut. . never invest in CDs at a bank any more. Learn to use treasury direct to buy treasury bonds, and keep them at your brokerage account, where you can sell them if desired/needed. Learn about TIPs bonds versus standard treasury bonds. . . learn about high quality dividends ETFs for diversified stock market income, SPYD, XLU for utility income, which is partially guaranteed by government statute, and REITS / Oil&Gas royalty trusts. . . no need to buy individual stocks for dividends because the individual equity risk is much higher than a diversified portfolio for simple management.

40% stocks /60% bonds has been the most ideal portfolio for the last 40 years, now its a different style investment regime, more focused on low bond interest rates and more towards very conservative equities and other equity like yielders

good luck walking in the investment jungle

Our grandsons and granddaughters all use their phones to handle their finances.
They think wife and I are dinosaurs because we use credit cards and cash.
They are more than capable of living in the modern world, and unlike many of us old codgers, love change and new innovations.

Right on
 

Biggest statement we can make is to vote. Inflation, cost of living, etc., was the reason the VCDD told me my amenity fee jumped $11 in March. When I moved here in 2009 I was told we would cap out at $155 for the amenity fee. So even if/when the inflation situation improves, I'm still paying at the higher rate. I'M VOTING!
As far as a "plan" to deal with inflation: I'm staying close to home, no vacations other than driving to see my kids (thank God I have a Prius), using my golf cart and e-bike more. I feel really badly for people who have to drive to work every day, especially families.

I also feel the same.

Imagen with all the pickup trucks that younger people bought to drive to work?
Or the price of gas for a fleet of semi's.

With the price of eggs, imagen what bakery products will cost?

Personally, I would suggest the use of MYGA’s (multi year guaranteed annuities) vs purchasing a CD. These are CD-like investments with fixed terms, sold by insurance companies that pay FAR more than a bank CD. Currently, a 5-year MYGA pays 3.5% (not all annuities are bad). While not insured by the FDIC, they are insured by the State of Florida up to $250,000 in case of default. The interest is not taxed yearly but instead is taxed at the end of the term chosen. You can roll over to another MYGA and delay the taxes further into the future. Many offer a 10% annual withdrawal of principal each year starting the second year of the contract without penalty. I currently own several MYGA’s as a small portion of my retirement and non-retirement assets and have been very pleased compared to the paltry CD offers. Do a Google search and you can get current rates. No, I am in no way affiliated with the insurance industry. I just refuse to accept the low rates offered by banks.

The current interest rate on my Vanguard money market account is 0.24 percent.