Episode description

034R | In today's podcast we discuss our thoughts on Part 2 of the Stock Series conversation with JL Collins, risk tolerance, doomsday scenarios and rebalancing.

In Today’s Podcast we cover: The Friday Roundup and the episode Part 2 of our discussion with JL Collins from The Simple Path to Wealth and JLCollinsNH

What do you do when there’s a large crash in the stock market? Big takeaway from Jim’s episode You can’t sell at the bottom, so you need to steel yourself mentally beforehand

If you’re starting investing, one of the best thing that can happen to you is a market crash You can’t time the market There are doomsday scenarios, but since they are so rare it is silly to plan for the absolute worst case and ignore the other 99.9% likelihood

Follow the math when making the best decision with the information at hand Question from Kevin about when to “take all your chips off the table” That event would have to be extraordinary and destructive for our country and economy

Spend less than you earn and invest in broad based index funds Feedback from Nancy on asset allocation and comfort with volatility and her belief that you shouldn’t take a lot of risk if you don’t need to Jonathan’s example of rebalancing and a hypothetical $1,000,000 portfolio and a 50% market crash

Equities will return significantly higher than bonds over the long term. Bonds do “smooth the ride” but lower long-term returns You want to rebalance in accounts like IRAs, 401ks that won’t trigger a taxable event Brad’s example of his parents investing strategy Over the long term which option is truly riskier?

Investing in stocks and facing volatility or lowering your expected return by investing in cash or bonds The 4% rule is based on getting a return while pulling out money each year, so you can’t just stick it in cash and expect the money to last forever

The power of the ‘perpetual money making machine’ to last forever

ChooseFI was mentioned on Forbes as one of three financial podcasts for people of all ages to listen to

We need panelists to select the finalists for the business building contest with Alan Donegan Lance on our Facebook group pulled the trigger on FI today – congrats!

What did Brad and Jonathan put into place this week as one life optimization? Jonathan’s salad hacks Jonathan is now saying “stimulus and response” out loud when finding something habitual in his life ChooseFI is not just limited to finances. It is a life optimization project Voicemail from Scott (Brad’s brother) Frugal wins of the weeks Itunes reviews of the week