Why Saving is for Suckers

Post by donw » Wed, Oct 21, 2009, 4:43 PM UTC

josefresco wrote: post #14

frodwith wrote: post #10

Right, because the SUCKERS like me who spend far less than they earn and keep their money in a savings account with the highest interest rate they can find (at essentially NO risk) were hurt so badly last time the economy crashed. Right?

Which is better, to live wealthy with high risk or to live poorly with little risk? Sure you can make out good when the economy crashes (which is rare) but in the meantime (while things are good) those taking high risks are sure enjoying themselves. Remember; it's just money, you can always make more, try to enjoy yourself a little bit while you have it and don't wall yourself off from the world just to keep what lit…

Post by gaius » Wed, Oct 21, 2009, 4:53 PM UTC

kingkongreveng_ wrote: post #13

billybob wrote: post #7

Earlier quoted context omitted.

Right. Putting all your eggs in one basket is for suckers. Keep some of your eggs in the fridge. They won't hatch many chickens, but they're unlikely to get eaten by foxes, either. Nothing to see here. Move along.

That's not what the article says. It says you have to deliberately move your eggs around according to the business cycle. A pure cash investing strategy (money market, CD, T-Bill/Bond) now has a track record as good as the US stock market over 30 year periods. Except the much lower volatility of cash makes it superior. Plowing money into stock indexes is for suckers. To get any decent returns one is forced to analyze…

Post by kirubakaran » Wed, Oct 21, 2009, 5:04 PM UTC

donw wrote: post #21

josefresco wrote: post #14

Earlier quoted context omitted.

Which is better, to live wealthy with high risk or to live poorly with little risk? Sure you can make out good when the economy crashes (which is rare) but in the meantime (while things are good) those taking high risks are sure enjoying themselves. Remember; it's just money, you can always make more, try to enjoy yourself a little bit while you have it and don't wall yourself off from the world just to keep what lit…

Having a savings account lets you do some really amazing things, though. I quit my full-time job as of last Friday (although they retained me as a consultant for part-time remote work), and will spending the next year or two (a) focusing on my new company, and (b) traveling. Having the freedom to make that happen, especially when nearly everybody around me is burdened by debt, is incredibly valuable. I couldn't do th…

Post by MikeCapone » Wed, Oct 21, 2009, 5:12 PM UTC

josefresco wrote: post #14

frodwith wrote: post #10

Right, because the SUCKERS like me who spend far less than they earn and keep their money in a savings account with the highest interest rate they can find (at essentially NO risk) were hurt so badly last time the economy crashed. Right?

Which is better, to live wealthy with high risk or to live poorly with little risk? Sure you can make out good when the economy crashes (which is rare) but in the meantime (while things are good) those taking high risks are sure enjoying themselves. Remember; it's just money, you can always make more, try to enjoy yourself a little bit while you have it and don't wall yourself off from the world just to keep what lit…

Post by chollida1 » Wed, Oct 21, 2009, 5:15 PM UTC

jrockway wrote: post #17

mikebo wrote: post #15

Earlier quoted context omitted.

I agree with your sentiment. I also keep quite a bit of money in cash, but these days I'm keeping less so since it seems likely we'll have high inflation in our future, given how much money is being printed. I've moved most of it to gold or silver.

Gold seems to continue to drop in price, even as we print paper money. It's possible that debt is more valuable than yellow-colored metal coins. (Gold does not have a lot more intrinsic value than anything else. If the economy collapses, will people be willing to buy your chunks of metal? Why?)