Best Long-Term Investments

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srv524
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Best Long-Term Investments

Postby srv524 » Sat Feb 09, 2013 11:46 pm

Couldn't find a post about this so I'll post the question here.

What is the single best long-term investment for say a 50-75 year period? Buy on a recurring basis (purchased every year), hold for 50-75 yr period, any money you make that are paid out on (say dividends) are re-invested.

I've read articles that say Gold is the best yet there are charts which show the S&P is best. Yet I think dividend stocks would be best as long as you buy a good amount each yr and automatically re-invest the dividends.

bpgui
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Re: Best Long-Term Investments

Postby bpgui » Sun Feb 10, 2013 6:41 am

No one can tell you what the "single best" investment will be over the next 50-75 years, but I can assure you it isn't gold. I would bet on low cost indexed stock funds (like the S&P or total market).

srv524
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Re: Best Long-Term Investments

Postby srv524 » Mon Feb 11, 2013 10:04 am

I figured that or a stock/bond balance with some commodities mixed in. I'm looking for a multi-generational investment, not just a 5-10 yr fix.

bpgui
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Re: Best Long-Term Investments

Postby bpgui » Mon Feb 11, 2013 10:55 am

srv524 wrote:... or a stock/bond balance with some commodities mixed in.

That would be a "single" investment though :lol:

VinTek
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Re: Best Long-Term Investments

Postby VinTek » Mon Feb 11, 2013 11:16 am

srv524 wrote:I've read articles that say Gold is the best yet there are charts which show the S&P is best. Yet I think dividend stocks would be best as long as you buy a good amount each yr and automatically re-invest the dividends.

Let's start at the beginning. Why do you believe this?

srv524
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Re: Best Long-Term Investments

Postby srv524 » Mon Feb 11, 2013 11:46 am

Why do I believe dividend stocks to be the best? Compound interest. Stable companies such as P&G, GE (which I currently own) and perhaps Verizon often have great dividend %'s. Even if the stock stays at the same price (and these bigger stable stocks tend to grow annually) the healthy dividend lets you buy more of their stocks, which increases the dividend $ you get, which lets you buy more stocks, etc.

brad
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Re: Best Long-Term Investments

Postby brad » Mon Feb 11, 2013 12:07 pm

A couple of years ago, financial journalist Dan Bortolotti did an excellent five-part series on dividend myths. Even though it's aimed at Canadians, there are a lot of general lessons to be learned from this series, and it's worth reading for anyone--anywhere--who is interested in figuring out whether they should invest in dividend stocks:

http://canadiancouchpotato.com/2011/01/ ... hs-part-1/

VinTek
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Re: Best Long-Term Investments

Postby VinTek » Mon Feb 11, 2013 12:10 pm

srv524 wrote:Why do I believe dividend stocks to be the best? Compound interest. Stable companies such as P&G, GE (which I currently own) and perhaps Verizon often have great dividend %'s. Even if the stock stays at the same price (and these bigger stable stocks tend to grow annually) the healthy dividend lets you buy more of their stocks, which increases the dividend $ you get, which lets you buy more stocks, etc.

So what kind of account do you intend to put your investments into? Tax-deferred accounts? Taxable accounts? If dividends are no longer "qualified" but become taxed as ordinary income, what will that do to your forecast? What if income tax rates go up?

I'm not trying to give you a hard time; I'm trying to make you see all the variables so you can think it through and reach your own conclusions.

GoldbergFinancial
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Re: Best Long-Term Investments

Postby GoldbergFinancial » Tue Feb 12, 2013 12:04 pm

Jim Cramer has been saying for years that no asset class has ever outperformed stocks over a 20 year period. The problem is the average person with a full time job and no time to manage their own investments ends up riding the market up and down with upmoves and crashes. Then if you can work with the typical advisor they just throw everything into a few mutual funds and ride the market up and down as well. But if you can invest in a good investment program with ETFs and INVERSE ETFs you can now make money in up and down markets. I am excited because I feel like I have developed a nice approach to do this but if you want the bare bones it works like this.

Pay attention to the S&P 500, buy SPY (the S&P 500 etf) until we get to 1550. Then buy the Inverse SPY (SH) until we crash back to around 800. In the meantime, go about your life.

If you want to make more money than that you can always contact me.

You can read my market prediction made in November about the S&P 500 bottoming at 1340 and the S&P 500 heading back into the 1500's. I was dead on.

Michael Goldberg
Goldberg Financial, LLC
http://financeinlife.blogspot.com/2012/ ... -time.html

VinTek
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Re: Best Long-Term Investments

Postby VinTek » Tue Feb 12, 2013 12:12 pm

GoldbergFinancial wrote:You can read my market prediction made in November about the S&P 500 bottoming at 1340 and the S&P 500 heading back into the 1500's. I was dead on.

A 3-month track record. Sign me up.

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Re: Best Long-Term Investments

Postby GoldbergFinancial » Wed Feb 13, 2013 11:39 am

Yes Vintek, I understand that and am working on building that track record, In the meantime should I just sit on my hands and get back to you all in 2016 with the standard 3 year track record the average person likes to see? The next market crash is going to provide one of the greatest opportunities to make money we have ever seen.

I have been investing for much longer than 3 months but started posting on my blog and all just last year and participating on this forum as well.

But answering the original question I would say if you have a working investment strategy in the stock market it is hard to find investments, especially in this low interest rate environment, to compete with that.

I also work with annuities and there is a 7% annual guaranteed annuity for 10 years which isn't bad, but those returns can be beat in stocks and the market is more liquid.

www.GoldbergFinancialLLC.com

VinTek
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Re: Best Long-Term Investments

Postby VinTek » Wed Feb 13, 2013 6:17 pm

GoldbergFinancial wrote:Yes Vintek, I understand that and am working on building that track record, In the meantime should I just sit on my hands and get back to you all in 2016 with the standard 3 year track record the average person likes to see? The next market crash is going to provide one of the greatest opportunities to make money we have ever seen.

I have been investing for much longer than 3 months but started posting on my blog and all just last year and participating on this forum as well.

But answering the original question I would say if you have a working investment strategy in the stock market it is hard to find investments, especially in this low interest rate environment, to compete with that.

I also work with annuities and there is a 7% annual guaranteed annuity for 10 years which isn't bad, but those returns can be beat in stocks and the market is more liquid.

http://www.GoldbergFinancialLLC.com

<shrug> All I'm saying is that a 3-month track record doesn't inspire confidence. Bill Miller had a great record for 15 years, but has lagged the benchmark 5 of the 6 past years. So even if you had a really good 3-year track record, it would not be indicative your next 3 years would be as good.

And hasn't every market crash presented great opportunities to make money?

And hasn't the stock market beaten every other asset in any period of 30 years or more?

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InvestingIQ
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Re: Best Long-Term Investments

Postby InvestingIQ » Wed Feb 13, 2013 6:47 pm

The answer would really depend on several other factors which are specific to your situation. That being said, any advice would still be conjecture.

Most financial advisors agree that the S&P outperforms any other option over the long term, but it is also not wise to make decisions based on past performance. My best advice is to either read up on all the different options and do your own research, or talk to several financial advisors and go with the one that seems the most knowledgeable and trustworthy. Sorry for not giving more specific advice, but anyone that gives you a specific answer to this without knowing you and your personal situation is not giving good advice.
Kris

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