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by jordan0day
4005 days ago
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I don't know much about the market, and know even less about actual investing strategy-ish stuff, but what does the loss look like five years later? I guess what I mean is, for an "index fund", crashes don't seem to be... permanent? Perhaps that's small comfort for someone who's set to retire the month after one of these 30% crashes, but I guess that's what the whole "invest more conservatively as you get older" thing is supposed to help with? |
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The big index and mutual fund companies offer different allocations between stocks and bonds. You might start out with 80% of your account in an index fund (or other diversified basket of stocks) and 20% in a hedged basket of investment-grade, low-risk bonds. This percentage allocation would change over time as you got closer to retirement.
You're not going to get insanely rich off of this, but it is a decent replacement for the fact that savings account interest rates are effectively 0% these days.