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Discussion on: The Importance of Financial Independence For Software Developers

ilonacodes profile image
Ilona Codes Author

Thank you for the great write-up about problems with forex and trading with leverage.

I’m not even interested at this point in these. I’m intrigued the most and excited about the common stock, active funds, ETF, REITs, value investments, and so on. Long-term stuff—no trading or speculating.

I feel you and can understand your frustration. This answer will be useful for folks who want to try leveraged trading—they probably shouldn’t (unless they know exactly what they are doing, and also depends on the country).

yuripredborskiy profile image
Yuri Predborskiy

As long as you understand what you're doing, you should be fine.

I think I forgot to mention something: the fact you're calculating your future retirement is awesome. Working towards building your own future is even more awesome. I wish you success!

I'm working on the same thing, but I figured out I want to spread my investments into real estate and stocks. Having experience with leveraged speculation I highly recommend everyone to be extremely careful with that as the risk of losing lots of money very quickly is extremely high. One can work in FOREX successfully, but, according to statistics, that one is one percent of all people who try.
It is said to be easier with stocks, but as long as you use a high leverage, small volatility can lead to catastrophic results. At the same time, stocks should be fine with no leverage and long-term investments (probably). But under stocks I mean stock indexes or index funds since otherwise it is less of an investment and more of a job.

I am thinking of adding other types of investment outside of real estate and stocks at some point, but not right away. Real estate offers a similar leverage stocks do via mortgage, and, if used properly, it can increase your profits. But it will also amplify a bad deal, making it lose more money. The hard part about real estate - if you don't have a ton of cash, it may be hard to start. Although there are ways to start with $0.

If you ever get interested in real estate I recommend checking out bigger pockets podcasts, there's a ton of information. And then there's Samuel Leeds and his youtube videos, also very informative. The difference is Samuel works in UK, while Bigger Pockets members mostly operate in the US.