“The best stock to buy is the one you already own.” Peter Lynch said that, and for many dividend investors today, the stock they already own is not really a stock at all. It is an ETF called SCHD.
Hi Dave, this work, much appreciated, leads me to the question; if I can get 3.8% on a CD why would I risk market declines for an ETF that earns less and could have a major price drop during a sell off or correction?
Great question Mark! Depending on where you are in your retirement journey, I would personally have a mix of safe investments, like your CD recommendation, and some “growth” investments. A lot of it will depend on your risk profile and how well you can sleep at night with riskier investments. It might make more sense to have 75% safe, 25% growth, for example, or to move the needle closer to 50/50 if you are more comfortable with risk. Unfortunately, there is no one-size-fits-all solution in these types of situations.
Hi Dave, this work, much appreciated, leads me to the question; if I can get 3.8% on a CD why would I risk market declines for an ETF that earns less and could have a major price drop during a sell off or correction?
Great question Mark! Depending on where you are in your retirement journey, I would personally have a mix of safe investments, like your CD recommendation, and some “growth” investments. A lot of it will depend on your risk profile and how well you can sleep at night with riskier investments. It might make more sense to have 75% safe, 25% growth, for example, or to move the needle closer to 50/50 if you are more comfortable with risk. Unfortunately, there is no one-size-fits-all solution in these types of situations.