Hello fellow mgtow. Today I want to talk to you about the biggest scams running on our worker population outside of social security.
In investing, it's amazingly better to be in early than later. $1k in facebook seed round would now be over $1m. Except you could only invest in facebook if you were already rich, which is other related scams called "accredited investor status" or "mainstream investor protection". I.E. define a boundary between rich and everyone else then disenfranchise the masses while claiming to protect them. I can go further into this in another post.
401k plans never buy into early things. They are essentially ways for the elite "accredited investors" to offload their bags to the sheep public. In addition the assets are continually inflated with another scam called "quantitative easing". I.E. giving rich people insane amounts of tax money through inflation. Yet another post.
When these companies get large enough, the accredited investor bag holders push these assets onto the general public as a way of raiding retirement accounts.
Now market cap is a strange thing. Many of you will claim that you made lots of money already with your 401k. With market cap, at any point it's about 1% or less of the actual amount of items in inventory. That means that once that market collapses, everyone is sitting around holding bags trying desperately to get out. That means your bags are always at risk of being exit scammed by the whales. See Zuck selling billions of stock causing a 20% dip. Note that the early investor Peter Thiel sold all of his facebook, even though he famously bought $500k at seed. Yet several retirement accounts and index funds include facebook.
401k is a ponzi scheme. What is a ponzi scheme? It's a type of financial strategy that has obvious market flaws which add significantly to the risk. Mostly that failure mode occurs when the market cap is lowered by 50% or more. If the market starts to crash then everyone would flee out of retirement accounts in the order of availability and liquidity. So the rich, who aren't working during the day and have access to better stock market tools, would be able to leave first even if they stupidly stuck around too long. Note that there may be enough underlying value to provide a floor value but there's nothing to suggest that retirement accounts should grow year on year.
So when I realized these things, naturally I cashed out my 401k account. First I had to call a retirement number because withdraw was disabled on the UI of the retirement provider I was using. Then I was sent 2 pdfs to fill out to have a check mailed to me. After not receiving response, I had to call again, where the rep told me they did not receive the documents. So I sent them again. Called again. Same response. This took several tries. Now it's 4 months later and I still don't have 1/3 of my money. Imagine if the market was collapsing or a bank run was happening during this! Which is exactly what would happen during a crash.
So what can you do? Smart and active investing. Dump your 401k. Live cheap. Invest in crypto. Buy property. Go MGTOW. There's a chance of catastrophic failure and societal reorganization. That chance gets larger every day. Don't be in a 401k account when that happens.
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Wait, whaaat?? So chasing block chain numbers on computer screens that literally mean ownership of nothing, hoping more people will buy in and boost the "value" higher is not a ponzi, but buying shares of companies that make your toilet paper and food and gasoline is?
That said, it's been about ten years since a major stock market crash. That's a long time. Just saying.. As an early retired MGTOW who lives on mutual funds, I survived the last market cluster fuck OK. Your advice to live cheap is on point. That's how I survived. Also diversification. Usually all market sectors don't crash at the same time.
I'm thinking real estate in developed countries may be priced too high if salaries stay flat. Who's going to buy all those half million dollar houses if most people are driving for Uber and stuffing boxes at Amazon? Does anybody expect prices like that in some little farm town in Mexico or India? No, because local salaries won't support it.
I don't expect an immediate real estate crash like 2008, but maybe a gradual decline?
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No problemo. You mentioned Vanguard so I will point out a "hybrid" fund that lets you start out with a $1000 depost, the Vanguard STAR fund. Note that I don't have a crystal ball. Probably a safe bet but everything might always crash tomorrow. People who say they know what's going to happen are liars or delusional.
The reason a hybrid fund is good to start is since you already have stocks and bonds in your fund, you won't feel you have to "market time" and sell every time there's a market dip. I've been doing this since the early 90s and there's always a market dip sooner or later. Like every other novice, back then I moved assets from one fund to another during a very temporary downturn and only lost money. Don't be dumb young me.
If you don't have $1000 saved up yet, open a savings account at your bank and transfer over a fixed amount from your checking every payday, whatever you can do even if it's $20. See if your bank will do it automatically for you. Then invest it in a fund when it hits $1000. After you have a fund set up, they will mail you deposit slips, or you can probably transfer funds from your bank online. Deposits don't have to be $1000 after you have the fund set up.
Invest a fixed amount without fail every month no matter what the market does. You will want to sell low and buy when the market is expensive and everybody is bragging about how much their funds have gone up, but that's the opposite of what you should do. Resist the urge. I remember right after the market crash in 2000 I was investing big checks every month and it felt like I was throwing money down a well chasing the bottom, but actually those were some of the best share buys I ever did.
If you get a raise or promotion at work, invest half of the after tax increase in your paycheck. That way you never get to experience higher pay and feel the loss when you invest it instead of spending it. Our lifestyles are a gas that expands to fill its container. You may never have drunk expensive wine or worn designer clothes, but if you were some rich lady's fancy lad for a year, you might start to believe those things are basic survival-level expenses.
If you can't find any room in your monthly budget for investing, see if you can cut back any fixed monthly expenses like cell plans, cable TV packages, very high internet speeds, streaming services, etc. Maybe consider moving to a smaller and cheaper apartment. Most people throw away money every month on things that don't even make them happy.
I saved and invested way beyond levels I'm describing here. I kept increasing it over the years (but I went on some trips and had some fun too). From the time I started maxing out my 401K contribution to when I was investing over half my gross pay and retired in my forties, it was about a decade and a half.
tl;dr If you don't know what else to do, get a hybrid fund that lets you start with a $1000 deposit. Trim your expenses and invest a fixed amount every payday. Don't try to time the market, you will probably lose.
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You're welcome.
Dude, read this right now. Just do it.
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