Benefiting from prudence

[Dg504]

Evening,

I don’t want to benefit as such from these turbulent times as there are lots of people in very serious situations.

I wondered what the collective wisdom is on coming out of these odd times, and I suppose still largely uncharted times, ahead of the curve?

Let’s set the scales at £10k, £50k, £100k cash sat waiting - what’s the best thing for it?

I’ve been reserved with my cash and have never kept up with next door or taken on finance for cars, phones, sofas etc.

Will this prudence ever be of benefit or has it all been for nothing?

[moles]

Nothing. At least that’s how it feels. The world is one giant Ponzi scheme that has gone past functioning without massive amounts of debt. Now we’ve gone down the rabbit hole we can no longer get back out.......

[DoubleSix]

Dg504 said:

Evening,

I don’t want to benefit as such from these turbulent times as there are lots of people in very serious situations.

I wondered what the collective wisdom is on coming out of these odd times, and I suppose still largely uncharted times, ahead of the curve?

Let’s set the scales at £10k, £50k, £100k cash sat waiting - what’s the best thing for it?

I’ve been reserved with my cash and have never kept up with next door or taken on finance for cars, phones, sofas etc.

Will this prudence ever be of benefit or has it all been for nothing?

Take no risk, receive no reward - seriously, you must know this?

[Luke.]

Chuck it all into shares, pick fairly sensibly, and in 5 years you'll be up. Job done.

[Dg504]

DoubleSix said:

Take no risk, receive no reward - seriously, you must know this?

I hear you - where would you be putting this cash then?

[Simpo Two]

moles said:

Nothing. At least that’s how it feels. The world is one giant Ponzi scheme that has gone past functioning without massive amounts of debt. Now we’ve gone down the rabbit hole we can no longer get back out.......

Memories are short. There will be other booms.

[DoubleSix]

Dg504 said:

DoubleSix said:

Take no risk, receive no reward - seriously, you must know this?

I hear you - where would you be putting this cash then?

Term?
Risk Tolerance?
Objective?
Age?
Health?
Dependents?
Tax considerations?
Etc.. etc...

I make my living from investment advice. How do you make yours incidentally?

[UpTheIron]

For the "lazy" investor that just wants to set and forget and come back to some growth in 5+ years time, then given where we are now is there a better option that the previous "default answer" of Vanguard LifeStrategy?

Obviously a crystal ball and timing the bottom would help...

[DoubleSix]

UpTheIron said:

For the "lazy" investor that just wants to set and forget and come back to some growth in 5+ years time, then given where we are now is there a better option that the previous "default answer" of Vanguard LifeStrategy?

Obviously a crystal ball and timing the bottom would help...

As good anything if you do just want a quick & easy solution... phase the investment a little and you’ll not be too bothered about the lack of crystal ball.

[Skyedriver]

Simpo Two said:

moles said:

Nothing. At least that’s how it feels. The world is one giant Ponzi scheme that has gone past functioning without massive amounts of debt. Now we’ve gone down the rabbit hole we can no longer get back out.......

Memories are short. There will be other booms.

Will I live long enough, I'm 66.......
Yeh of course I will, I'm immortal.

[Terminator X]

Dg504 said:

Evening,

I don’t want to benefit as such from these turbulent times as there are lots of people in very serious situations.

I wondered what the collective wisdom is on coming out of these odd times, and I suppose still largely uncharted times, ahead of the curve?

Let’s set the scales at £10k, £50k, £100k cash sat waiting - what’s the best thing for it?

I’ve been reserved with my cash and have never kept up with next door or taken on finance for cars, phones, sofas etc.

Will this prudence ever be of benefit or has it all been for nothing?

Won't your cash get "burnt" once the money printing presses start turning?

TX.

[bitchstewie]

This is the first-world problem I have.

Many years worth of living expenses in the bank as direct cash which is a nice feeling right now but also an awareness that it's doing bugger-all for me in the bank.

I'm already dripping into my existing investments but do wonder whether to lump a bit more in when the news ISA year opens.

[psi310398]

bhstewie said:

This is the first-world problem I have.

Many years worth of living expenses in the bank as direct cash which is a nice feeling right now but also an awareness that it's doing bugger-all for me in the bank.

I'm already dripping into my existing investments but do wonder whether to lump a bit more in when the news ISA year opens.

There are, of course, times when cash sitting in the bank with its value only being eroded by very low inflation will outperform most other forms of investment.

But we also live in a time when central banks are simply printing money, or are about to. And cash deposits are only as good as the deposit guarantee schemes protecting them, which might be bugger all use if the Euro and/or Sterling crash and all the banks come down.

If I had spare cash, I think I'd go old skool and buy gold instead. In portable form capable of being stored under the mattress or buried at the bottom of the garden...or bog paper, of course.

[Phooey]

bhstewie said:

..do wonder whether to lump a bit more in when the news ISA year opens.

I've been thinking about this all week. I've max'd this current years (put the final lump in as cash pending buying fund/s), but unsure how to play the 2020/21 ISA yr. Options at present are -

1/ just keep buying in monthly as i was before the recent events

2/ put it in as cash pending (my gut feeling is we haven't seen the bottom yet / ignore the upward activity this week)

3/ combination of the above

I always say you should learn from your mistakes. Mistake no1 was lumping money into funds when the first 5% drop came - some on here (Donkeyapple for example) was saying he wouldn't be buying yet as he thinks more to come... I thought it'd be a blip and markets would go back up. They tanked and I'd used up most my ammo.

Out of interest which funds do you buy or will be buying into?

[bitchstewie]

Phooey said:

Out of interest which funds do you buy or will be buying into?

Personally I'm cautious and tend to go into the likes of Troy's Trojan fund.

I found out a fair bit about my appetite for volatility and I'm much more comfortable having a bigger pot in a less volatile fund.

I tend to subscribe to the view that the first rule of making money is to try not to lose it in the first place though.

[Phooey]

bhstewie said:

I tend to subscribe to the view that the first rule of making money is to try not to lose it in the first place though.

Ha yes - very wise words!

I have quite a bit in passive funds atm so might go for a bit more of an active input for 20/21. For example - (admittedly I need to do some reading up on it firstly) I'm tempted to do one of our ISAs with Fundsmith

[bitchstewie]

Phooey said:

bhstewie said:

I tend to subscribe to the view that the first rule of making money is to try not to lose it in the first place though.

Ha yes - very wise words!

I have quite a bit in passive funds atm so might go for a bit more of an active input for 20/21. For example - (admittedly I need to do some reading up on it firstly) I'm tempted to do one of our ISAs with Fundsmith

I think there's a lot of truth in it.

If you look at the percentage increase required to recover from a loss it can get scary pretty quickly IMO but I guess everyone has different tolerances for that sort of thing.

I've found the active v passive thing interesting during all of this.

I'm entirely in active funds but keep an eye on the popular passive options as it's something I keep giving consideration to.

[Derek Chevalier]

Phooey said:

bhstewie said:

I tend to subscribe to the view that the first rule of making money is to try not to lose it in the first place though.

Ha yes - very wise words!

I have quite a bit in passive funds atm so might go for a bit more of an active input for 20/21. For example - (admittedly I need to do some reading up on it firstly) I'm tempted to do one of our ISAs with Fundsmith

Here's a good start

https://www.amazon.co.uk/Incredible-Shrinking-Alph...

[Phooey]

Derek Chevalier said:

Here's a good start

https://www.amazon.co.uk/Incredible-Shrinking-Alph...

Cheers for the link.

If you don't mind me asking - what is your opinion on the Fundsmith fund?

[fishseller]

DoubleSix said:

Dg504 said:

Evening,

I don’t want to benefit as such from these turbulent times as there are lots of people in very serious situations.

I wondered what the collective wisdom is on coming out of these odd times, and I suppose still largely uncharted times, ahead of the curve?

Let’s set the scales at £10k, £50k, £100k cash sat waiting - what’s the best thing for it?

I’ve been reserved with my cash and have never kept up with next door or taken on finance for cars, phones, sofas etc.

Will this prudence ever be of benefit or has it all been for nothing?

Take no risk, receive no reward - seriously, you must know this?

Sometimes being risk adverse and prudent could result having a large sums in the bank which in times like these you can sit back relax knowing you are not going to starve or be homeless