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<p>[QUOTE=&quot;dcarr, post: 2393153, member: 4781&quot;]My personal take on &quot;investing&quot; (given as an opinion only, not as advice):</p><p><br /></p><p>There is no such thing as a &quot;retail investor&quot;. There are only &quot;retail chumps&quot;.</p><p>Sure, some people have made a lot of money in stocks as &quot;retail&quot; buyers and sellers. Many have not. If you buy a stock in the hope that you can sell it for more in the future, that is NOT <i>investing</i>.&nbsp; It is <i>speculating</i>. The average stock buyer is a speculator, no different than the average coin buyer who is looking to make a profit. Buying a coin in the hope that it will go up in market value so you can sell at a profit is speculating, just like buying a stock. There is nothing wrong with speculating, however, so long as you realize that it isn&#039;t the same thing as investing.</p><p><br /></p><p>Warren Buffet, for example, is a true investor and not a speculator. When he buys, he BUYS THE COMPANY, reorganizes it, and runs it his way. That is the ultimate &quot;activist investor&quot;. If you are not an <i>activist</i> in a company you own shares in, then you are a speculator, not an investor.</p><p><br /></p><p>However, stocks that pay dividends are a little different. If you buy dividend-paying stocks for the purpose of an income stream, then that is similar to buying a bond, an annuity, or a certificate of deposit (for examples). That is fine, so long as the counterparty properly fulfills their obligations (which isn&#039;t always the case). I would consider this type of thing to be a form of &quot;saving&quot;, not really investing or speculating.</p><p><br /></p><p>If a person has some extra discretionary income to &quot;invest&quot;, that money should go towards these things (in priority order from highest priority to lowest):</p><p><br /></p><p>1) Pay off debt. Start with the highest interest rate loan first.</p><p>So-called &quot;financial advisors&quot; would never advise you to liquidate your 401K (or similar). But if I had a 401K earning 2% on average and a mortgage charging 5%, I personally would cut out the middle man and liquidate the 401K, pay the penalties, and use the proceeds to pay down the mortgage. If the 401K entity were to go belly-up (unlikely but not impossible), you would still be holding the bag for the mortgage. Of course, this all depends on how many years away your penalty-free IRA/401K withdrawal is, how much money is involved, and what company matching contributions (if any) are in effect. The feeling of knowing that you have less debt and no counterparty to rely on for the 401K money, is priceless. There is a reason why the laws are structured the way they are. Everything is geared towards putting your own money under the control of someone else (the &quot;bank&quot;). You wouldn&#039;t buy bullion and then pay to have someone else store it in their vault. Why do that with the rest of your money ? Cut out the middle man (the bank and other &quot;financial institutions&quot;) wherever and whenever possible.</p><p><br /></p><p>2) Invest in yourself. Skills and capabilities (education), equipment, facilities, property, etc. There is no better company to invest in than yourself.</p><p><br /></p><p>3) Assets. Purchase things that you enjoy, but also have potential resale value. Unlike a stock certificate, owning a classic car or a nice coin is something you can enjoy while you own it.</p><p><br /></p><p>4) Invest in companies run by someone else (retail stocks), or loan money at interest to someone else (bonds).[/QUOTE]</p><p><br /></p>

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