Homepage / Investment / Cramer Remix: Why the stock market is the most effective way to make money long term
Deneme Bonusu Veren Siteler Deneme Bonusu 2024 Explore the Magic of WildCardCity Güvenilir Bahis Siteleri En İyi Kumar Siteleri Balıkesir Triatlonuna Avrupadan Ödül Tricks of the Aviator gambling establishment game by Spribe Çevrim Içi Kumar Siteleri “bonus” Yalanıyla Kandırıyor En Güvenilir Canlı On Line Casino Siteleri Xbetting-tips Com Uncovering the Abundant Tapestry of Ozwin Gambling establishment Evaluating Board Portal Providers Uncovering the Wealthy Tapestry of Ozwin On line casino Electronic Data Area Providers Evaluation Cobra Internet casino: Raising the Australian On the internet Video gaming Practical experience 4 Things to Search for in Safeguarded Cloud Safe-keeping Fastpay On line casino Australia – Simple and No-Taxation Wagering Web page officielle franзaise de Joka Gambling establishment The Software Development Universe Game Woo Internet casino – Enjoy Slot machine games around australia Ostdeutsche Biersorten What Are Virtual Data Rooms? Vitamin D Receptor Polymorphisms Revue du Casino BlackLabel Faktory, kterй ovlivnujн hodnocenн ceskэch online kasin How to Make the Most of Your Web Development Organization and Advertising Efforts L’essor des casinos en ligne en France Boost Meeting Efficiency With Boardroom Technology Developments WildJoker Casino WildCardCity On line casino – Guaranteed Australian Gambling Portal WildCardCity Casino – The Ideal On the internet Gambling establishment within australia Modern Technologies Produce Sharing Documents Online Faster and More Protect Free Virtual Info Room pertaining to Speedy Due Diligence A Review of Data Area Software For people who do buiness Five Board Bedroom Features Which will help You Acquire a More Productive Boardroom Electronic Systems To your Business Understanding Legal Terms and Laws in Today’s World The Laws and Contracts of Hollywood: A Sunset Blvd. Tale Legal Discussion Between Johnny Cash and Antonin Scalia Legal Insights: What Teens Should Know Legal Issues and Exceptions: What You Need to Know Legal Insights and Expert Analysis Celebrity Dialogue: Legal Matters in the 21st Century Famous Personalities Discuss Legal Issues The Boys in the Boat: Legal Advisors and The Quest for Legal Knowledge Understanding Legal Matters: Q&A on Criminal Law, Joint Ventures, and More Enticing Title The Departed: Understanding Basic Work Requirements and Legal Rights Youth Slang Blog Article Legal Insights: A Journey into the World of Law The Ins and Outs of Legal Matters: Everything You Need to Know Legal Insights and Trends: A Rap Guide Mysterious Legal Matters Unveiled Insights and Information: Understanding Various Laws and Regulations Famous People of the 21st Century The Circle of Legal Life The Intersection of Fashion Law, Legal Translation, and THC Oil: A Modern Legal Guide Legal Q&A: Understanding Joinder Federal Rules and More Understanding Legal Terms and Conditions: A Comprehensive Guide Understanding Legal Documentation in a Fun Way! Understanding Legal Aspects: From Islamic Law of Inheritance to Farm Law Protests Understanding Legal Rights: A Guide to Legal Regulations and Requirements Understanding Legal Guidelines and Agreements Famous 21st Century People in Conversation Mysterious Legal Matters Unveiled Legal Matters and Real Estate: A Conversation Between Cameron Boyce and Donald Trump Understanding Legal Expertise and Why It Matters Legal FAQs and Expert Services Understanding Legal Ramifications: Common Law Ontario Health Benefits and More The Ins and Outs of Legal Requirements: From FBI Academy Physical Requirements to Silver Lake Fishing Rules The Legal Underworld: Understanding the Significance of Laws and Rights Legal Conversations: A Dialogue Between Jon Jones and Chadwick Boseman Legal Beats: Bobcats, Real Estate, Babysitting, and More Legal Matters and Netflix VPN Diabolique: Legal Affairs and Deception Ben Shapiro and Eddie Van Halen Discuss Legal Matters Legal Aid and Other Legal Issues Q&A Famous 21st Century Personalities in Dialogue Youthful Blog Post Expert Legal Insights: Top 8 Law Firms in Australia, Quasi Contracts, and More! Youth Slang in Legal Matters Steps to make Your Mother board Room Even more Productive and Meaningful Choosing Data Rooms for Homework The Enigmatic World of Legal Affairs and Contracting The Mystery of Legal Matters Understanding Legal Mandates and Guidelines in the Business World Celebrity Dialogue: Legal Matters and Personal Names Legal Questions: Answered! Mysterious Legal Insights and Tips The Mysterious World of Legal Agreements Legal Lingo: Reviews, Agreements, and More Exploring Legal Education and Responsibilities: A Comprehensive Guide Unconventional Wisdom: A Dialog Between 21st Century Icons Mysterious Legal Matters Unraveled The Legal Maze: Navigating the Legal Landscape Dialogue between Jared Kushner and Vasyl Lomachenko Legal Matters: A Conversation Between Prince and Lionel Messi Get Clued In: The Legal Lowdown for Gen Z Famous People of the 21st Century Talk About Legal Matters The Enigmatic World of Legal Agreements and Terms Are You Breaking the Law? Unusual Legal Questions Answered Understanding Legal Services, Parental Responsibility Laws, and More Understanding Legal Agreements and Requirements

Investment

Cramer Remix: Why the stock market is the most effective way to make money long term

Unless you are born with a silver spoon in your mouth, accruing wealth does not come easily, which is why Jim Cramer is so passionate about helping investors find a viable financial strategy.

“Thanks to the magic of compounding, the earlier in your life you start investing in the market, the bigger your long-term gains can be,” the “Mad Money” host said.

For instance, if $100 is invested in the S&P 500 and it gains 10 percent in a year, that will generate $110, after another year it’s $121 and after a third year it’s $133.

The gains will continue to grow, because each year, money is made from the previous year’s profits. With that 10 percent average annual return, an investor can double his money in about seven years, Cramer said.

“The magic of compounding works best the younger you are because that means you have more time for your money to grow,” Cramer said.

For instance, if a 22-year-old is just entering the workforce, she has more than 40 years before she retires. She can invest $10,000 in an S&P index fund right now with the anticipation that the next 40 years will not be too different from the last 40 years.

When it comes to investing, Cramer always says investors must have two discrete places for their cash.

The first is a retirement portfolio, which is more conservative and should be invested through a tax favored vehicle like a 401(k) or an Individual Retirement Account.

The second is a discretionary or “mad money” portfolio. This is the place to take more risks with money once a retirement fund has been invested.

The first $10,000 invested in the market should go to a low-cost index fund or exchange-traded fund that mirrors the S&P 500. This gives investors a way to get exposure to the stock market gains without putting in the time or effort needed to pick individual stocks.

One of Cramer’s top rules for young investors is that they should take more risks. That does not mean they should go crazy and speculate with all of their savings. But it does mean using some discretionary money to bet on high-risk long shots, or smaller, lesser-known companies with massive upside potential.

Cramer loves the public school system, but the truth is that it cannot be relied upon to teach children about money.

“If you want your children to become fluent in the language of finance, you are going to have to do it yourself,” Cramer said.

That means not waiting until after kids go to college to teach them about financial literacy. Once kids go to college, they will be bombarded by credit card offers that could seem irresistible. Credit-card debt on top of student loans could send someone into debt for decades.

Cramer has always had the notion that excessive prudence can be one of the most reckless strategies of all. If too much money is invested in safe, risk-free U.S. Treasury bonds, that basically insures a very low return on an investment. So, for those who want to grow their capital, stocks are the only game in town.

Stocks are a tool to make money, Cramer said, and bonds are for capital preservation — for protecting money and providing a small, steady return that can offset the impact of inflation.

“Depending on how old you are, there is a huge difference in how you should approach the very idea of putting your money in bonds,” Cramer said.

How much of a retirement portfolio should be kept in bonds versus stocks? Cramer broke it down by age:

  • 20s: None
  • 30s: 10 percent of your retirement fund; 20 percent if you are conservative
  • 40s: 20 to 30 percent bonds
  • 50s: 30 to 40 percent
  • 60s: 40 to 50 percent
  • Post-retirement: Increase bond exposure to 60 to 70 percent

Additionally, Cramer does not subscribe to the “buy and hold” mantra that most financiers do. He’s all about “buy and homework.”

That means that no matter how confident one is in a company, she must keep checking up on it regularly to make sure nothing has gone wrong in the story.

While taking investments into consideration for the long term, one thing became very apparent to Cramer: if you know what you are doing, a bear market is an opportunity.

A bear market refers to when the major averages are down by more than 10 percent from their highs and seem like they could go lower.

“What I am saying is that when you are faced with a bear market … it probably makes more sense to start buying most stocks, rather than selling them, as long as you are willing to take some short-term pain,” Cramer said.

The key is to be patient enough to take advantage slowly — so you avoid buying too close to the top — and to be careful about the stocks chosen in a bear market.

Do your homework and pick the stocks of companies that are doing well and could be doing better in a stronger environment, and your portfolio could benefit in the long run, Cramer said.

Questions for Cramer?
Call Cramer: 1-800-743-CNBC

Want to take a deep dive into Cramer’s world? Hit him up!
Mad Money TwitterJim Cramer TwitterFacebookInstagramVine

Questions, comments, suggestions for the “Mad Money” website? madcap@cnbc.com

Source: Investment Cnbc
Cramer Remix: Why the stock market is the most effective way to make money long term

Comments are closed.