[AndrewKemendo]

>And what I see is that historically, it's generally been a good idea to put money in the stock market.

I've been following the stock market since 1995 and have come to precisely the opposite conclusion

Why?

You have zero ability to predict the state of the market at the point that you need liquidity. So it doesn't matter if your portfolio increases for 20 years, if you need your liquidity during a crash, welp you're fucked.

[chii]

> if you need your liquidity during a crash, welp you're fucked.

But this simply means you didn't predict that you'd need the liquidity, which is easier than predicting the crash.

You have to know that as you get older, you will likely need that liquidity more. Thus, you should be swapping illiquid assets over time, as you get older, bit by bit.

Not doing it is equivalent to taking a bigger risk than you could afford to be taking.

[AndrewKemendo]

>But this simply means you didn't predict that you'd need the liquidity, which is easier than predicting the crash

Oh how silly of me to forget that investors have target liquidation periods and that even the most 101 level of investor knows that

Yet somehow something so basic as - predicting exactly when you are going to need your savings - eludes millions of people

Get real

[chii]

> predicting exactly when you are going to need your savings - eludes millions of people

it doesn't elude millions. it "eludes" those who didn't plan their financial journey, or take more risks than they should be (for example, not liquidating a chunk when planning on having a baby).

Just because people can't do it well, doesn't mean it isn't what they should be doing. Financial planning is not "put all money into the stock market and hope for the best", as the grandparent post implies.

[WJW]

Sure, but crashes don't make up even 10% of the total amount of time. If you needed liquidity at any other time, having been invested would have been the right thing to do. In addition, there are many options available to make more liquidity available at all times, from literal (put) options to just simple diversification and holding a part of your wealth in cash as an emergency fund.

It's good to focus on the bad outcomes as well as the good outcomes, and most people do indeed make the mistake of only considering the good outcomes. But looking at only the comparatively rare bad outcomes and then concluding that investing in the stock market is a bad idea is just availability bias.

[dublinben]

What’s the alternative then? How have you invested for the last twenty years taking this into account?

[AndrewKemendo]

I'm the lead investor in all the things I want to do including all the companies or non-profits I've founded

[momirlan]

one shouldn't put emergency money in the stock market, but only cash that is not needed as "liquid".

[mcv]

And as you move closer to the moment you may need your money (like retirement), you should move your investment from stock to safer investments. Ideally during a hype when everything is inflated of course, but anything other than a crash is a good time to sell.