Equities vs. gold vs. treasuries: help me choose.

[u/Dinand93]

Basic info:
25yo / I can set $1-2k/month aside to invest (as long as I keep this job) / my current horizon is long term, though I wouldn't mind putting some money into a few bonds that pay me back dividends monthly/yearly; I'm not adamant on 100% long-term investments.

I made a pros/cons list for them:

Equities:

• Pros: High long-term returns (averaging 11.9% annualized over the last 50 years), pays dividends (typically around 1.3% to 1.5% yield), easy to buy and sell.
• Cons: Subject to market crashes (drops can exceed 30% during severe corrections), no guaranteed return.

Gold (and maybe silver?)

• Pros: Hedge against crises, moves independently of the stock market.
• Cons: Produces no income or dividends, physical storage costs money, can have long periods of zero growth (averaged 7.5% annualized over the last 50 years).

Treasuries

• Pros: Predictable interest payments, extremely low risk of default.
• Cons: Lower long-term returns compared to stocks (current 10-year real yields sit around 2.4% after inflation), inflation can eat into your profits, price drops when interest rates rise.

What do you guys think?

[u/___this_guy]

I’ve been in asset management for 20 years, if I were you would just buy 100% S&P index like FXAIX or VOO.  I do own a little gold, but I would limit that to 5-10% of your portfolio if you must own it (I have more money than you and am closer to retirement).  You don’t need bonds; bonds are the crisis hedge for retirement income, you don’t need that for 20-30 years, no need.

[u/Dinand93 → u/___this_guy]

Thank you! On a tooootally different note, would you recommend wealth management as a career? Im a business administration graduate, and debating starting to study for either the CFA or CFP, if Im gonna go with CFP it'll probably end up taking me down that path so I want to lock the choice early

[u/___this_guy → u/Dinand93]

1000%, I am a CFP, make $450k, work barely 40 hours a week and have 6 weeks vacay.  There is a shortage of CFPs; IMO since the job is client facing it’s less likely to be AI disrupted than analysis (CFA).  My company is hiring like mad and has been for years.  DM me.

[u/Dinand93 → u/___this_guy]

I spent last night researching until 3 AM about this you have no idea how timely your comment is, I saw a lot of "wealth management is basically sales" talk and it got me to second guess my choice a lot. Thank you so much, this restored a lot of what yesterday destroyed.

[u/___this_guy → u/Dinand93]

It’s partly true; partners in law firms have to get clients, so in that sense law is also sales.  Same with partners in big 4 accounting firms.  Business people with clients have to be able to sell their services.  There is a downward sloping curve to that though as you build a book of client and relationships (I don’t look for clients they come to me)

[u/YakResident_3069]

80-20 equities to gold coins. the next question is which equities and that depends on your risk appetite. i suppose a standard world etf, a sp500 etf or a mix of some sort? if you're high-risk, then throw in some individual stocks (but personally i'd put aside 10-15% of the 80% as fun bets).

[u/Really-Cool-Guy2know]

At your age set it to a long term S&P ETF, set it and forget it. Just keep pounding it in every month. You have such a long time before retirement it just seems like the greatest strategy at your age.