30 years old / Missed the bull run

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thejuice03
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30 years old / Missed the bull run

Post by thejuice03 » Thu Jun 04, 2015 1:15 am

Hello everyone, I have recently discovered this forum and I apologize if i'm lacking proper formatting for the site, I'll catch up quickly this is my first post.

After graduating university in 2008 and thankfully finding a job, I immediately fell into the trap of not doing anything meaningful with investing because I was afraid of losing everything to the next market crash. I started listening to Peter Schiff's radio show and have been convinced that the world is going to end. I have read enough books to talk myself out of that line of thinking.

I am currently in the market indexing my 401K, and my wife and I have started indexing our Roth IRA's every month. We are currently budgeting on a 33/33/33 budget of housing expenses/spending/saving. I think it's a good plan for the future. However, now that my mind is right I can't help but fear that I have screwed myself out of not gaining benefits of the last bull run. I have a couple questions:

1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?

thanks everyone!

Call_Me_Op
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Re: 30 years old / Missed the bull run

Post by Call_Me_Op » Thu Jun 04, 2015 8:16 am

thejuice03 wrote: 1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
You can't make-up for it. All you can do is start doing the right things going forward. Write an investment plan, implement it, and stick with it.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein

asif408
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Re: 30 years old / Missed the bull run

Post by asif408 » Thu Jun 04, 2015 8:17 am

thejuice03 wrote:I have a couple questions:

1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?
1) You can't make it up. I'm 35 and just got my act together in the last 1-2 years with my investments, so don't feel like the lone ranger. The best thing you can do is keep saving and keep investing. If you are saving 33% of your income you're way ahead of most people. There will be more bulls and bears in the future. Who knows? The current bull may keep running for a while.

2) I think this is very person specific. You need enough to live on if you lost your job or had a large emergency (medical emergency is the biggest that comes to mind). I've seen recommendations of anywhere from 3 months to 1 year of living expenses. If you have low job stability and no family/friends that could help you financially in a pinch then I would lean towards 1 year of expenses. If your job is stable and you have family/friends that could help in a financial pinch, and you also have other accounts that you could possibly lean on (HSA, Roth IRA) then you might lean towards 3 months.

I have a stable job, I've built up a decent savings in my HSA, my parents would be willing to help me out if needed, and since I have Roth IRA's (and would consider raiding my Roth IRA, but only as a last resort) I keep a smaller emergency fund.

One final note: I would say as investments go to keep some money in high quality bonds, even if it's just 10 or 20% (i.e., don't have 100% in stocks). During market drops that will provide money to buy more stock shares at lower prices. Even will all the bond doom and gloom predictions with rising interest rates, historically nothing has provided a better cushion in market declines that high quality bonds.

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Maynard F. Speer
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Re: 30 years old / Missed the bull run

Post by Maynard F. Speer » Thu Jun 04, 2015 8:34 am

If you look beyond the US, there are markets at far lower valuations than the US was in 2009, at the beginning of its bull market ... The US isn't the centre of the world anymore - large economies like Russia and Brazil haven't had their bull markets yet, while Japan's has only just kicked off .. Italy and S.Korea still look cheap ..

I'd say your two options are to save more, and/or to consider a value approach .. Meb Faber's book, Global Value, makes a very good case for looking beyond the US - I'd recommend it, but you'd need good discipline and a long-ish horizon ..

Typing "global Cape ratios" into Google should link you to some good data on valuations .. StarCapital's page is a goldmine
"Economics is a method rather than a doctrine, an apparatus of the mind, a technique of thinking, which helps its possessor to draw correct conclusions." - John Maynard Keynes

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arjking
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Re: 30 years old / Missed the bull run

Post by arjking » Thu Jun 04, 2015 8:43 am

I'm 35 but I joined the work force a few years late due to a case of arrested development. I lived at home longer than I should have and saved money and invested, went to graduate school. As a result my account looks good and my earning potential is good but other things suffered. I got married and divorced along the way. So I made different choices and am at a different place than you as as result but I can't say I made any "mistakes" because you never know how things would have turned out. Don't be so hard on yourself. The past is irrelevant. Plenty of time to make up for lost time if you work hard.

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goingup
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Re: 30 years old / Missed the bull run

Post by goingup » Thu Jun 04, 2015 8:52 am

Go easy on yourself! You're doing exactly the right things to catch up fast. Saving at a 33% pace will quickly put you ahead of the pack. I read this and agree:
Save 10% and you'll do fine. Save 20% and you'll thrive. Save 30% and you'll be wealthy. :sharebeer

dh
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Re: 30 years old / Missed the bull run

Post by dh » Thu Jun 04, 2015 8:59 am

arjking wrote:I'm 35 but I joined the work force a few years late due to a case of arrested development. I lived at home longer than I should have and saved money and invested, went to graduate school. As a result my account looks good and my earning potential is good but other things suffered. I got married and divorced along the way. So I made different choices and am at a different place than you as as result but I can't say I made any "mistakes" because you never know how things would have turned out. Don't be so hard on yourself. The past is irrelevant. Plenty of time to make up for lost time if you work hard.
Welcome to the forum! The Bogleheads are a great group of people who have helped me a great deal.

I agree with arjking. Rather than focusing on the past, be optimistic about your future. You have several investing decades ahead! You are doing the right things by making regular contributions through your tax deferred retirement plan at work, and annually in your Roth. Stick to your plan (write an IPS, if you do not have one); keep your emotions in check, stay rational, keep plugging away at your plan through the bull markets and bear markets you are certain to encounter. You have several decades ahead - look forward, not back!

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Re: 30 years old / Missed the bull run

Post by MrNewEngland » Thu Jun 04, 2015 9:06 am

Here's my advice: don't worry about it.

I did invest a decent amount of my paycheck after college into my 401K and IRA, and it has turned out to be one of the smartest things I have done. However a couple years ago I got into a situation where I had to reduce the amount I was putting towards retirement down to almost zero.

Now I have taken care of that and actually let a friend move in with me (as a roommate paying rent) and I am able to contribute more than I ever have before. With that said I realize that this new money has missed a solid bull run.

Do I think the bull run is close to being over? Maybe.
Do I think that there is a market correction coming? Maybe. (In fact I would say definitely at some point)

Despite those very real possibilities I am dumping as much money into my retirement accounts as possible and keeping them aggressive. I can afford it now and I realize that if I want the big gains we've seen the past several years I will have to endure the years where I take losses. I accept that and I have now accepted the fact that I am unable to time the market.

If you can afford it you should put money in. If losing money in down years is something you can't handle then don't put money into equities.

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BL
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Re: 30 years old / Missed the bull run

Post by BL » Thu Jun 04, 2015 9:10 am

You seem to be on the right path with your money. Here is a little booklet to help with other ideas:
http://www.etf.com/docs/IfYouCan.pdf

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timboktoo
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Re: 30 years old / Missed the bull run

Post by timboktoo » Thu Jun 04, 2015 9:25 am

Come up with an asset allocation that you're comfortable with, that will allow you to hit your goals and that you can stay the course with. As far as an emergency fund goes, I just use an online savings account and keep enough in there to cover 6 months expenses.

A lot of us use this to construct our portfolios, myself included:
http://www.bogleheads.org/wiki/Three-fund_portfolio

- Tim

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Re: 30 years old / Missed the bull run

Post by IPer » Thu Jun 04, 2015 9:29 am

You don't have any idea if you missed anything...wait 30 or 40 years.
Most folk don't capture the sheer energy power and glory of their 20's and have it
transformed into assets to fuel their life, so at 30, if you are just starting, you are
way ahead of most. That 10% / 20% / 30% thing is a good thing to concentrate on. 33% / year for
30 years will probably get you to a good position, assuming the world doesn't end or we go into
a dark age or Bill Gross finally nails a prediction...
Read the Wiki Wiki !

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Re: 30 years old / Missed the bull run

Post by pkcrafter » Thu Jun 04, 2015 10:36 am

Reply in blue...
thejuice03 wrote:Hello everyone, I have recently discovered this forum and I apologize if i'm lacking proper formatting for the site, I'll catch up quickly this is my first post.

Check here for suggested posting:

http://www.bogleheads.org/forum/viewtop ... f=1&t=6212

After graduating university in 2008 and thankfully finding a job, I immediately fell into the trap of not doing anything meaningful with investing because I was afraid of losing everything to the next market crash.

This is a behavioral problem of Risk Aversion. One of the first things you need to do as an efficient investor is to learn about the No. 1 reason investors lose money--behavior. Here is a link to Behavioral Pitfalls in our Wiki. At the bottom of the page you will find references to some good books on the subject.

http://www.bogleheads.org/wiki/Behavioral_pitfalls

What happens in the short term is not important. Prices rise and fall, but you don't lose your number of shares. Your goal now is to accumulate more shares. and take advantage of compounding.


I started listening to Peter Schiff's radio show and have been convinced that the world is going to end. I have read enough books to talk myself out of that line of thinking.

This is why we don't recommend listening to news, opinions and squawk.

I am currently in the market indexing my 401K, and my wife and I have started indexing our Roth IRA's every month. We are currently budgeting on a 33/33/33 budget of housing expenses/spending/saving. I think it's a good plan for the future. However, now that my mind is right I can't help but fear that I have screwed myself out of not gaining benefits of the last bull run. I have a couple questions:

Another behavioral error - regret. Look ahead and learn to do it right.

Getting Started:


http://www.bogleheads.org/wiki/Boglehea ... art-up_kit

One more reference:

William Bernstein's If You Can


http://www.google.com/url?sa=t&rct=j&q= ... 9771,d.cGU

It would help if you posted your entire portfolio, all accounts equal to 100% and overall asset allocation. See link above.

1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.

You can't, and don't try by increasing risk. You are still young enough to be successful, especially at your current savings rate.

2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?

Insuring you never touch your retirement pool requires a good understanding of behavior and an emergency fund to cover unexpected expenses. Depending on job security for both of you, emergency funds usually range from 3-4 months of expenses to 9-10 months.

Paul


thanks everyone!
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.

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Re: 30 years old / Missed the bull run

Post by itstoomuch » Thu Jun 04, 2015 11:46 am

thejuice03 wrote:After graduating university in 2008 and thankfully finding a job, I immediately fell into the trap of not doing anything meaningful with investing because I was afraid of losing everything to the next market crash.
If you were/are just starting out in 2008-09, having a secure base [cash, emergency fund, funds for short term needs] is, IMO, very acceptable and appropriate. The Great Recession was/is a very traumatic and scary time for the people whom we know.
GL
:beer
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Re: 30 years old / Missed the bull run

Post by Grt2bOutdoors » Thu Jun 04, 2015 12:53 pm

thejuice03 wrote:Hello everyone, I have recently discovered this forum and I apologize if i'm lacking proper formatting for the site, I'll catch up quickly this is my first post.

After graduating university in 2008 and thankfully finding a job, I immediately fell into the trap of not doing anything meaningful with investing because I was afraid of losing everything to the next market crash. I started listening to Peter Schiff's radio show and have been convinced that the world is going to end. I have read enough books to talk myself out of that line of thinking.

I am currently in the market indexing my 401K, and my wife and I have started indexing our Roth IRA's every month. We are currently budgeting on a 33/33/33 budget of housing expenses/spending/saving. I think it's a good plan for the future. However, now that my mind is right I can't help but fear that I have screwed myself out of not gaining benefits of the last bull run. I have a couple questions:

1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
One can not go back, one however can move forward. Select an asset allocation plan that will permit you to sleep at night yet capture the market returns. Given your ages, a range of 70/30 to 80/20 is recommended for retirement savings, re-balance either annually or quarterly. Change your allocation only when you 1)have reached your financial goals or 2)tolerance for risk has declined. Do not change your allocation except to rebalance to meet your stated asset allocation plan if the market experiences a hiccup or decline. You want to buy low, sell high, not buy high, sell low.
2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?
Place enough aside that will permit you to withstand a protracted job search should you lose yours. I don't believe 3-6 months is sufficient except for those folks whose occupations are in extremely high demand, the older one gets usually the more difficult it is to find a suitable replacement job and that trend seems to have amplified itself during this last economic decline. I think a goal of 1-2 years expenses held in fixed income should be sufficient.
thanks everyone!
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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Re: 30 years old / Missed the bull run

Post by 2Birds1Stone » Thu Jun 04, 2015 12:59 pm

goingup wrote:Go easy on yourself! You're doing exactly the right things to catch up fast. Saving at a 33% pace will quickly put you ahead of the pack. I read this and agree:
Save 10% and you'll do fine. Save 20% and you'll thrive. Save 30% and you'll be wealthy. :sharebeer

What about saving 60-65% =D

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ray.james
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Re: 30 years old / Missed the bull run

Post by ray.james » Thu Jun 04, 2015 1:09 pm

thejuice03 wrote: I started listening to Peter Schiff's radio show and have been convinced that the world is going to end. I have read enough books to talk myself out of that line of thinking.
I was on that exact boat for about 2 years at the end of college. Lucky for me it was only only 2 years and I had so much debt, I could only pull a few K's silver holdings back then. Silver lost most of its inflated value over the years .

Whats done cannot be undone.
Focus on future. Since you are still 30, there are lot of years compounding to work.
When in doubt, http://www.bogleheads.org/forum/viewtopic.php?f=1&t=79939

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vitaflo
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Re: 30 years old / Missed the bull run

Post by vitaflo » Thu Jun 04, 2015 1:12 pm

thejuice03 wrote: 1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?
If it's any consolation, I started my investing trip at the end of the dot-com bubble in 2000. Yeah it sucked when the market tanked, but I just stuck with it. In my mind I kept telling myself "I'm buying these stocks on the cheap!". It took 10 years (and another stock crash) before my investments were finally above water, but because I kept investing during that whole time as if nothing happened, I've been rewarded quite a bit in the last several years.

Fact is, if you have a 30 year time horizon (like you do), what's happened the last few years doesn't matter. You also probably wouldn't have had enough in the market for it to make a meaningful difference anyway. There will be other bull markets. Stay the course and it will pay off.

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Taylor Larimore
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Boglehead help

Post by Taylor Larimore » Thu Jun 04, 2015 1:25 pm

thejuice03:

Welcome to the Bogleheads Forum!

If you would like specific suggestions, use this link:

ASKING PORTFOLIO QUESTIONS

Best wishes.
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle

ddurrett896
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Re: 30 years old / Missed the bull run

Post by ddurrett896 » Thu Jun 04, 2015 2:14 pm

thejuice03 wrote: 1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
I'm 29 and feel somewhat the same. I'm currently 100% stock and plan to stay that way until my 50's to maximize my growth. Hopefully by then we will have gone thru 2 or 3 bear markets.
thejuice03 wrote: 2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?
There are a lot of factors here such as job security, expenses, etc. I keep 6 months cash.

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Re: 30 years old / Missed the bull run

Post by heyyou » Thu Jun 04, 2015 2:34 pm

Keep saving for a couple of more decades then check your progress. Somehow it works out well if you save long enough, and you will have more than those who don't save. Due to your saving more, just knowing how to live on less is a survival skill during worse times.

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Re: 30 years old / Missed the bull run

Post by mlebuf » Thu Jun 04, 2015 2:42 pm

Forget the past. You are only 30 and there will be many more bull and bear markets in your lifetime. Your 1/3, 1/3, 1/3 plan is excellent. Just stay the course and stick with your plan through good times and bad. I didn't get serious about trying to build wealth until I was 35 and didn't find Vanguard until age 55.
Best wishes, | Michael | | Invest your time actively and your money passively.

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HomerJ
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Re: 30 years old / Missed the bull run

Post by HomerJ » Thu Jun 04, 2015 2:49 pm

There will always be another one...

I was 30 in 1999... and had just started saving a decent amount, just in time for the crash in 2000...

So I felt like I missed out on the 1990s bull...

But, lo and behold, and I got to enjoy this last one... and it worked out well, because I saved a ton of money between 2000-2009, and all of that got to grow during this last bull.

dh
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Re: 30 years old / Missed the bull run

Post by dh » Thu Jun 04, 2015 4:42 pm

HomerJ wrote:There will always be another one...

I was 30 in 1999... and had just started saving a decent amount, just in time for the crash in 2000...

So I felt like I missed out on the 1990s bull...

But, lo and behold, and I got to enjoy this last one... and it worked out well, because I saved a ton of money between 2000-2009, and all of that got to grow during this last bull.
Great example, HomerJ! Being young and accumulating more units at declining prices with each 401 contribution, is the best way to fully appreciate the next bull. The original poster is 30 years old and has decades of investing. He will experience multiple bear and bull markets. Maintaining a long-term perspective and focus on accumulating shares (not today's portfolio value) is key.

dc81584
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Re: 30 years old / Missed the bull run

Post by dc81584 » Thu Jun 04, 2015 4:58 pm

33/33/33 plan is excellent.

Ostentatious
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Re: 30 years old / Missed the bull run

Post by Ostentatious » Thu Jun 04, 2015 5:11 pm

Agreed with nearly all the posts above. Be easy on yourself. At every point in your (investment) life, you're better than some and some others are better than you. The most important thing is that you're now on the right path. Hopefully, in the next decade, you'll be happy with your portfolio. Depending on pay raises and other opportunities, you may be able to save even more in the future. Even for those who took advantage of their investment opportunities in their twenties, there is no guarantee that all will be well with them throughout their working life. Draw your investment plan and follow it. You'll be glad you did. Good luck.

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Re: 30 years old / Missed the bull run

Post by goingup » Thu Jun 04, 2015 6:38 pm

2Birds1Stone wrote:
goingup wrote:Go easy on yourself! You're doing exactly the right things to catch up fast. Saving at a 33% pace will quickly put you ahead of the pack. I read this and agree:
Save 10% and you'll do fine. Save 20% and you'll thrive. Save 30% and you'll be wealthy. :sharebeer

What about saving 60-65% =D
That should work out well for you!

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Re: 30 years old / Missed the bull run

Post by surfhb » Thu Jun 04, 2015 11:14 pm

30%? Save 50-70% of you and your wife's income and be a superstar in no time! Totally doable if you cut out all the BS and crap you dont need.

Examples: Cable, $80 a month phone bills, $25K cars, keep your food budget under $400 a month, stop eating out so much, ect

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Re: 30 years old / Missed the bull run

Post by tj » Thu Jun 04, 2015 11:36 pm

surfhb wrote:30%? Save 50-70% of you and your wife's income and be a superstar in no time! Totally doable if you cut out all the BS and crap you dont need.

Examples: Cable, $80 a month phone bills, $25K cars, keep your food budget under $400 a month, stop eating out so much, ect

This is not required for a comfortable retirement. No need to deprive oneself. I mean OP has not stated how much he makes, so I would not be quick ot suggest there's anything wrong with his savings rate.

surfhb
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Re: 30 years old / Missed the bull run

Post by surfhb » Fri Jun 05, 2015 1:03 am

tj wrote:
surfhb wrote:30%? Save 50-70% of you and your wife's income and be a superstar in no time! Totally doable if you cut out all the BS and crap you dont need.

Examples: Cable, $80 a month phone bills, $25K cars, keep your food budget under $400 a month, stop eating out so much, ect
en und
This is not required for a comfortable retirement. No need to deprive oneself. I mean OP has not stated how much he makes, so I would not be quick ot suggest there's anything wrong with his savings rate.
Im sure his savings rate is great but why not shave about 10 years off your working life?

Depravity? Those things listed were just examples of often unneeded luxuries when you think about it.

I mean, if the OP and his wife make 160K, you save 100K a year and live on 60K. :sharebeer

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Re: 30 years old / Missed the bull run

Post by Ari » Fri Jun 05, 2015 2:34 am

I suspect it's pretty normal to only start worrying about investments and retirements when you're in your thirties. When in your twenties you've got so many dreams and plans and you're not thinking about these things. When you hit 30 you realize you won't be young forever. :) I'm 31 and just recently started, too, kicking myself for not investing during the '08 crash, since I had a stable job throughout this time. But that's in the past and we both have a bright investing future ahead of us. Just focus on getting that money into those accounts, and work on mastering your emotions to be able to stay the course. These crashes are pretty small in the grand scheme of things, and what matters is time in the market, after all.
All in, all the time.

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Re: 30 years old / Missed the bull run

Post by 2comma » Fri Jun 05, 2015 3:17 am

Juice, you are still in your 30's and you've figured it out (and found the bogleheads). You wouldn't believe how many of us have made much worse mistakes than waiting till 30 to invest but were doing great in our 50's. Once you understand the basics and if you continually invest for 25 or more years you'll be in 2 comma land. If you stay above 20% to contributions you'll probably be in multi 2 comma land. Not to worry, just to avoid the big mistakes and it will almost certainly work out for you.
If I am stupid I will pay.

Rich in Michigan
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Re: 30 years old / Missed the bull run

Post by Rich in Michigan » Fri Jun 05, 2015 5:34 am

I started around age 26

I didn't find the Bogleheads until age 60

At age 60 I was still in my lifetime AA of 90% equities

I can't even tell you off the top of my head how many downturns I lived through as well as several prolonged economic malaises.

In other words, I was far from doing everything right.

The one thing I did right (besides getting lucky on a few blockbuster stocks in my early years) was I made sure I threw money in that bag every year. During the years when our kids were young, it was often only $1K but I made sure to keep the habit going.

Lo and behold, compounding worked its magic over the decades. I paid off a house, got two kids through college, and was able to retire young-ish and live quite comfortably in retirement.

You are worried about a downturn but just keep tossing money into your own bag, find an AA you can live with, and realize you have many big bull markets plus a number of painful bear markets ahead of you. That is just the way a lifetime of investing is. Find a nice graph on the power of compounding, look at the part where the curve goes up geometrically, and say to yourself "that will be my nest egg some day".

And that will be your nest egg some day.

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Re: 30 years old / Missed the bull run

Post by Dulocracy » Fri Jun 05, 2015 8:30 am

You caught it at 30. Congratulations! I caught it at about 33. I am now 37, and I am happy to report all will be ok. I have a similar savings percentage as what you have. Keep at it. The one thing that I would advise is to do extra bits at random as money is available. Over the last few years, I have consistently set aside money in accordance with my investment plan. If I had money left over in the entertainment budget, I would throw it at something. Extra on the mortgage. Extra in a taxable account (we max our tax advantaged accounts now). Extra money in the HSA. Those little bits of extra also add up, even when it is just $10 extra. Keep to your investing plan. Put aside extra. Let go of the regret. It took me several years to let go of the regret (and it still rears its ugly head), but everything will be ok. The more ok everything becomes, the more I let go of regret. Just remember to stick to that plan.
I'm not a financial professional. Post is info only & not legal advice. No attorney-client relationship exists with reader. Scrutinize my ideas as if you spoke with a guy at a bar. I may be wrong.

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Re: 30 years old / Missed the bull run

Post by BogleBoogie » Fri Jun 05, 2015 8:41 am

goingup wrote:Go easy on yourself! You're doing exactly the right things to catch up fast. Saving at a 33% pace will quickly put you ahead of the pack. I read this and agree:
Save 10% and you'll do fine. Save 20% and you'll thrive. Save 30% and you'll be wealthy. :sharebeer
+1 and AGREED! Don't look over past potential returns and "what if's". When you are fully indexed, you'll never be happy (i.e. on year international will do well and you'll wish you had more). The fact that you have come to the right site for info, are saving 33% of your money, and are only 30 means you are destined for success. You have plenty of time to build a great nest egg. Don't give this last bull another thought. It is TIME IN THE MARKET and you have time my friend! :sharebeer :sharebeer :sharebeer

tj
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Re: 30 years old / Missed the bull run

Post by tj » Fri Jun 05, 2015 9:47 am

surfhb wrote:
tj wrote:
surfhb wrote:30%? Save 50-70% of you and your wife's income and be a superstar in no time! Totally doable if you cut out all the BS and crap you dont need.

Examples: Cable, $80 a month phone bills, $25K cars, keep your food budget under $400 a month, stop eating out so much, ect
en und
This is not required for a comfortable retirement. No need to deprive oneself. I mean OP has not stated how much he makes, so I would not be quick ot suggest there's anything wrong with his savings rate.
Im sure his savings rate is great but why not shave about 10 years off your working life?

Depravity? Those things listed were just examples of often unneeded luxuries when you think about it.

I mean, if the OP and his wife make 160K, you save 100K a year and live on 60K. :sharebeer
Who decides what is an unnecessary luxury? I'd personally rather "work the 10 more years" than try to live on $400/month of food for two people. I budget myself $15/day and I'm one person and I don't have a super luxurious food intake.

heyyou
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Re: 30 years old / Missed the bull run

Post by heyyou » Fri Jun 05, 2015 10:34 am

@ the OP

Charlie Munger (Warren Buffett's business partner) has said "Someone will always be getting rich faster than you, this is not a tragedy." It is wise to cultivate long term thinking such as that.

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Re: 30 years old / Missed the bull run

Post by surfhb » Fri Jun 05, 2015 10:35 am

tj wrote:
surfhb wrote:
tj wrote:
surfhb wrote:30%? Save 50-70% of you and your wife's income and be a superstar in no time! Totally doable if you cut out all the BS and crap you dont need.

Examples: Cable, $80 a month phone bills, $25K cars, keep your food budget under $400 a month, stop eating out so much, ect
en und
This is not required for a comfortable retirement. No need to deprive oneself. I mean OP has not stated how much he makes, so I would not be quick ot suggest there's anything wrong with his savings rate.
Im sure his savings rate is great but why not shave about 10 years off your working life?

Depravity? Those things listed were just examples of often unneeded luxuries when you think about it.

I mean, if the OP and his wife make 160K, you save 100K a year and live on 60K. :sharebeer
Who decides what is an unnecessary luxury? I'd personally rather "work the 10 more years" than try to live on $400/month of food for two people. I budget myself $15/day and I'm one person and I don't have a super luxurious food intake.
$15 a day is $450 but youd be surprised how well you can eat for half that. There are entire blogs dedicated to this stuff. Also, its cheaper with 2 people involved in the food budget. Most people spend 2 or 3 times more on food and drinks without thinking about. Everyone is different, I was hoping to give the OP some perspective and options. These are just quick examples.....food and transportation are my largest 2 budget items by far.

If you love your work and dont mind delaying financial independence for several more years, then great.

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ryuns
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Re: 30 years old / Missed the bull run

Post by ryuns » Fri Jun 05, 2015 11:51 am

Opportunity cost is a very real thing, and it speaks to the advice we often hear for people to start saving as early as possible. But honestly, I started saving what I could from my first jobs and was buying stocks during a cheap market. And I netted, say, 50% that someone like you didn't net. But 50% of a small number is still a small number. Sure, you missed out on some years of savings and some years of good returns, but I wouldn't fret about those years of good returns. It was unlikely to be a game-changer. Save what you can going forward with a reasonable investment plan. Keep your expenses in check. (You can debate all day about whether it's "worth it" to live on a $400/mo food budget and bank the rest, but the important thing is being conscious of what you spend. Don't mindlessly buy things you don't need, don't overspend when the upgrade doesn't bring you joy, and always look for a way to get equal utility with less spending.) You'll do fine.
An inconvenience is only an adventure wrongly considered; an adventure is an inconvenience rightly considered. -- GK Chesterton

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Re: 30 years old / Missed the bull run

Post by sagitarius_d » Fri Jun 05, 2015 3:47 pm

thejuice03 wrote:Hello everyone, I have recently discovered this forum and I apologize if i'm lacking proper formatting for the site, I'll catch up quickly this is my first post.

After graduating university in 2008 and thankfully finding a job, I immediately fell into the trap of not doing anything meaningful with investing because I was afraid of losing everything to the next market crash. I started listening to Peter Schiff's radio show and have been convinced that the world is going to end. I have read enough books to talk myself out of that line of thinking.

I am currently in the market indexing my 401K, and my wife and I have started indexing our Roth IRA's every month. We are currently budgeting on a 33/33/33 budget of housing expenses/spending/saving. I think it's a good plan for the future. However, now that my mind is right I can't help but fear that I have screwed myself out of not gaining benefits of the last bull run. I have a couple questions:

1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?

thanks everyone!
I think you have a good several decades of saving, investing and compounding that money of yours. Do not beat yourself up, just create a strategy, stick to it through thick and thin, and you will do great. The bull market move of the next 30 - 40 years will likely be larger than the bull market move from 2009 - 2015.

Good luck in your investing!

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Re: 30 years old / Missed the bull run

Post by arthurdawg » Fri Jun 05, 2015 6:58 pm

You've got lots of good advice above, I'll just reemphasize that you've got plenty of time to save and build a portfolio for the future. Learn and read over the next year, get your plans ready and go for it. You'll do fine!
TSM / SCV / FTSE Big World / FTSE Small World / REIT / TBM / Int Term Tax Exempt

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Re: 30 years old / Missed the bull run

Post by JW-Retired » Sat Jun 06, 2015 9:48 am

thejuice03 wrote: After graduating university in 2008 and thankfully finding a job, I immediately fell into the trap of not doing anything meaningful with investing because I was afraid of losing everything to the next market crash. I started listening to Peter Schiff's radio show and have been convinced that the world is going to end. I have read enough books to talk myself out of that line of thinking.
............................
1) how can I make up for what I have done to my 20's? I hope that my future earning power can make up for the mistakes of my 20's.
2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?
Almost everyone makes early investing mistakes. As all the responses say, age 30 gives you plenty of time to make up for it.

One thing I wanted to point out is you should actually welcome a long bear market in your 30's if it should happen. Assuming you stay the course, it would mean you get a whole lot of contribution money invested at low bear market prices.

The 08/09 event was so short it didn't amount to much in that sense.
JW
ps: an emergency fund of 6-12 months of expenses is usually recommended.
Retired at Last

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Re: 30 years old / Missed the bull run

Post by Tozan13 » Sat Jun 06, 2015 9:36 pm

How's that expression about the tree go?

"The best time to plant one was twenty years ago; the second best time is today."

Welcome to the forum, friend, and Happy Saturday :)
"An investment said to have an 80% chance of success sounds far more attractive than one with a 20% chance of failure. The mind can't easily recognize that they are the same." -Daniel Kahneman

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Re: 30 years old / Missed the bull run

Post by FrugalInvestor » Sat Jun 06, 2015 9:52 pm

You're way ahead of the game by knowing what to do and more importantly, what not to do, at this point in your life. Make a plan and stay the course from here on out and you'll do just fine.
IGNORE the noise! | Our life is frittered away by detail... simplify, simplify. - Henry David Thoreau

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Re: 30 years old / Missed the bull run

Post by hadron » Sun Jun 07, 2015 12:43 am

Make a plan and stick with it.
It is a marathon not a sprint. Unless you are planning on retiring some time soon, there is no need to worry about missing this bull run.
I'm 35 and I don't really like these bull runs during my accumulation phase. Equities are so darn expensive!

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Re: 30 years old / Missed the bull run

Post by sunny_socal » Sun Jun 07, 2015 9:32 am

I've also been extremely bitter about 2008. I didn't know the difference between a bear/bull and just thought "stocks are bad, wish I could just keep my money in a mattress." So I pulled all my 401k into commodities, gold another other 'safe' selections at the start of the crash :oops:

I've since educated myself and now I'm looking forward to the next crash :beer I have enough years ahead of me and know that the feast-famine cycle is necessary.

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Re: 30 years old / Missed the bull run

Post by David Jay » Mon Jun 08, 2015 1:58 am

sunny_socal wrote:... and know that the feast-famine cycle is necessary.
I like that so much, I'm going to steal it! If there were no down markets, there would be no risk premium for equities.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

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Re: 30 years old / Missed the bull run

Post by thejuice03 » Tue Jun 23, 2015 1:12 am

sorry everyone, I'm just getting back to this post. I'm blown away by all of your wisdom. This forum is remarkable. Thank you for all of your posts and I look forward to talking to all of you for the next 50 years.

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Re: 30 years old / Missed the bull run

Post by NateH » Tue Jun 23, 2015 12:37 pm

thejuice03 wrote:
2) what sort of emergency fund does everyone recommend to cover market conditions to ensure I never touch my money?

thanks everyone!
Not knowing what your definitions of Spending and Expenses are, i would guess 6-months worth of something between .333 and .667.
In an emergency, you can always cut spending, but not always cut expenses.
4X top-twenty S&P 500 prognosticator. I'd start a newsletter, but it would only have one issue per year.

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Re: 30 years old / Missed the bull run

Post by LadyGeek » Tue Jun 23, 2015 4:20 pm

This thread is now in the Investing - Help with Personal Investments forum (portfolio help).

thejuice03, welcome!
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

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Re: 30 years old / Missed the bull run

Post by jbird11 » Tue Jun 23, 2015 5:00 pm

BL wrote:You seem to be on the right path with your money. Here is a little booklet to help with other ideas:
http://www.etf.com/docs/IfYouCan.pdf
This is one of the best reads I've come across. Thanks.

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