No. of Recommendations: 11
I just found this board today (5/12/24)so I've only scanned some posts. The comments below may thus be old news to this group.
Re compounding for long periods and minimizing taxes, I'm surprised to not see discussion about Berkshire Hathaway stock. It is a company that retains and reinvests all earnings and pays no dividend. So the money one invests compounds at a rate now approximating the S&P 500 over long periods with no tax consequences until it is sold. Then you pay capital gains taxes, lower than ordinary taxes, and are able to choose how much and when. An added bonus is the step-up on death for spouse and heirs. That can permit compounding without tax consequences.
Due to size, we can't expect growth rates anywhere comparable to the past. But it's not unreasonable to expect high single digit returns. And, with dry powder, there are occasionally chances to invest at attractive prices. Maybe not a thrilling return outlook to those with animal spirits. OTOH it's a widely diversified company and about as low risk for permanent loss of capital as exists in the equity markets.
The concern about Warren Buffett's passing is far overblown. If the market overreacts there could be some really attractive entry points.
Just curious what others might think on this subject.
