All Encompassing Investment and Financial Planning Thread for the Surly 99.5%

[Guest]

20 minutes ago, UTPhil2006 said:

If y’all need me to run comps for you guys I can… in Austin and Houston (don’t have access to SABOR or NTREIS).. I don’t mind. Just shoot me a PM or email 

Thanks, but it's no big deal. I just do a monthly net worth spreadsheet so having a spot to easily access the number is nice. Used Redfin for the past couple of years and it seemed fine, but now these huge swings. But in general between Zillow and Redfin, I come to a number that makes sense to me based on what I see in the neighborhood.

[Parliament 14232]

2 hours ago, UTPhil2006 said:

If y’all need me to run comps for you guys I can… in Austin and Houston (don’t have access to SABOR or NTREIS).. I don’t mind. Just shoot me a PM or email 

15 yo doublewide in Dumas on a 5 acre lot outside town.  I have my own well.  Small detached garage with an old Chevy.

What's it worth?

[Knoxtnhorn 5971]

Quick ?  Does anyone know if being of age (18) is a requirement for online stock accounts like Webull (what I use)?  I have a 16 year-old and a 10 year-old.  I'd like to get them started.  

[Hefeweizen 5310]

I don’t think so.  My 16 yo son has both a regular fidelity account and a Utma account with stock in them.

[BearSchlong 8083]

My parents and grandparents started trusts, so at least I had to be of age before I started spending frivolously.

[bluto 4912]

Opened a 6% checking acct with origin bank, up to 40k (acct activity strings attached). 

[Knoxtnhorn 5971]

Sorry about the laziness of my earlier post.  I was at school, and the thought struck me.  

I did look it up just now.  At least with Webull, one must be 18.

[Knoxtnhorn 5971]

5 hours ago, Hefeweizen said:

I don’t think so.  My 16 yo son has both a regular fidelity account and a Utma account with stock in them.

Cool.  Looking at Utma right now.

[JGrayDBU 338]

58 year old teacher in Alaska, away from the wife for year 2, except for Christmas and summers.  Year 3 is almost certainly my last year away from the wife and I will come back to teach special ed in Texas.  I am thinking no problem getting a teaching job in Texas, but we will see. 

Total of 6 years in Alaska(1st 3 were with the wife) will need to be purchased from Texas TRS.....no problem, because by then I will most likely not be maintained in the Alaska system.  The "maintained rule"  says I cannot purchase more than 5 years of service while maintained in a retirement system in another state.  Alaska does have a bill in the legislature to give all public servants a pension, but this is all very iffy.  This governor reminds me of Bill Clements, with his anti-spending stances on just about everything.   I will take the retirement acct. from Alaska and roll into an IRA. After the first semester teaching in Texas, I am able to apply to buy the years and the service purchase should be complete by March 1. 

Have been very fortunate in my ability to save for retirement the last 2 years.  Am trying to figure out how much emergency fund to bring with me to Texas.  No housing ready in Texas at the moment.  Wife has been staying with relatives, working, and paying off her debt.  wife will most likely have an apt. mostly furnished, sometime in the next 4-6 months. 

Since I worked for the state of Texas for 6 years, I can choose which retirement system to retire from.  I am that guy who calls ERS and TRS about once every 6-9 months and takes about 20 minutes to run down everything I have been told and at this moment I am still looking at being able to choose which system and the obvious choice is to retire from ERS, with the promise of a free health insurance premium for life for me and 1/2 off for the wife.  We are both very lucky the legislature has not taken that benefit away.  

I still like the traditional, deductible IRA.  I plan to contribute $7000 for 22 and $7500 for 23.  Doing that reduces my possible emergency fund down to maybe $40k instead of $54k or so.  When I land in Texas I will be 59.5 years.  

My income tax bracket now is much higher than I plan for it to be in retirement.  

One variable is the summer job market.  I am looking for a summer job this summer for the first time in a while.  In Texas I always worked at least one part-time job and sometimes 2. I don't care what I do, but it would be really cool to teach summer school as well as work another job to stay busy and continue to save money.   Any guesses on Texas summer job market? From now to June 2025 is the final push to save as much $ as I can, and the plan is to retire from education June 2025 at age 60.5. Wow!   As recently as July 2021 I had age 67 in mind to retire from education.  

Will continue to work in retirement, and defer all new income up to the max per year.  Retire from everything at age ? 

Questions:

1. What holes do you guys see? 

2. How bad are the utility bills?  I was the guy who had the lowest possible utility bill.

3. Any guesses on job markets-specifically summer jobs this summer? 

4. I keep up with inflation wrt grocery prices, so that doesn't scare me.  Other areas of severe inflation? 

 

 

 

 

 

 

 

 

 

 

 

 

[Nice Guy Eddie 13508]

@JGrayDBU you didn’t share numbers which is perfectly cool but the real test is whether you will earn enough retirement income to pay your expected expenses, including standard inflation.  And it doesn’t matter if the expected expenses is living in a trailer in rural Texas  or penthouse in NYC. Will you be able to afford your plan.

For your question on utility bills, they’re as bad as I’ve seen in Texas since deregulation started but the bill amount itself depends on your individual use.

[JGrayDBU 338]

3 hours ago, Nice Guy Eddie said:

@JGrayDBU you didn’t share numbers which is perfectly cool but the real test is whether you will earn enough retirement income to pay your expected expenses, including standard inflation.  And it doesn’t matter if the expected expenses is living in a trailer in rural Texas  or penthouse in NYC. Will you be able to afford your plan.

For your question on utility bills, they’re as bad as I’ve seen in Texas since deregulation started but the bill amount itself depends on your individual use.

Depending upon inflation, the numbers are solid, as in pensions from both my wife and myself equaling $47,000 per year - Non COLA and every time I calculate every expense known to this man I get a number just south of $40,000 if buying a small home with cash-----if renting a small apartment the expenses number is more like $45,000.  Then the second wave of benefits comes in a few years later- with social security---hers $12000 per year and mine about $6000 per year.  Mine is low because of the GPO.  Those numbers do not count my job during retirement, which should yield at least 20k per year in deferred income. 

Deferred accounts project to total $320k  at age 60 for me before buying a house with cash and buying years of service.  After those two big ticket items, deferred accounts should be in the 100-150k range.  I have heard of Monte Carlo simulations and wonder if that is realistic thing to look into?  I imagine planners charge a lot of dough to do Monte Carlo simulations? 

 

 

 

[Archer 474]

8 hours ago, JGrayDBU said:

Depending upon inflation, the numbers are solid, as in pensions from both my wife and myself equaling $47,000 per year - Non COLA and every time I calculate every expense known to this man I get a number just south of $40,000 if buying a small home with cash-----if renting a small apartment the expenses number is more like $45,000.  Then the second wave of benefits comes in a few years later- with social security---hers $12000 per year and mine about $6000 per year.  Mine is low because of the GPO.  Those numbers do not count my job during retirement, which should yield at least 20k per year in deferred income. 

Deferred accounts project to total $320k  at age 60 for me before buying a house with cash and buying years of service.  After those two big ticket items, deferred accounts should be in the 100-150k range.  I have heard of Monte Carlo simulations and wonder if that is realistic thing to look into?  I imagine planners charge a lot of dough to do Monte Carlo simulations? 

 

 

 

There are free calculators and simulators all over the internet, do some research to see which are more valid and respected. 
 

Here is one that gets referenced a lot:

https://firecalc.com

[Nice Guy Eddie 13508]

13 hours ago, Archer said:

There are free calculators and simulators all over the internet, do some research to see which are more valid and respected. 
 

Here is one that gets referenced a lot:

https://firecalc.com

whats the suggestion on how to use that calc?  I went with estimating my annual expenses, backing off non-retirement accounts income, and then estimating my funds balance at retirement.

I was getting between 0-9% failure scenarios depending on different numbers. What feels tough to estimate is what I need. I really don't spend much but who knows living costs will be when I'm 75 or 80.   53 now.   And if I need assisted living, forget about it.

[Trey3216 15343]

23 hours ago, JGrayDBU said:

Depending upon inflation, the numbers are solid, as in pensions from both my wife and myself equaling $47,000 per year - Non COLA and every time I calculate every expense known to this man I get a number just south of $40,000 if buying a small home with cash-----if renting a small apartment the expenses number is more like $45,000.  Then the second wave of benefits comes in a few years later- with social security---hers $12000 per year and mine about $6000 per year.  Mine is low because of the GPO.  Those numbers do not count my job during retirement, which should yield at least 20k per year in deferred income. 

Deferred accounts project to total $320k  at age 60 for me before buying a house with cash and buying years of service.  After those two big ticket items, deferred accounts should be in the 100-150k range.  I have heard of Monte Carlo simulations and wonder if that is realistic thing to look into?  I imagine planners charge a lot of dough to do Monte Carlo simulations? 

 

 

 

Some of the big questions: 

1)Is it worthwhile to buy extra years service in the TRS system?  Most calculations I've done show it's not the best use of money.  

2)Does it make sense to buy a home with cash when you can utilize those funds elsewhere to create solvency on the property rather than 0 debt?  

3)Monte Carlo simulations are fine, but you have to consider sequence of return simulations in the mix. 

4)A few others as well that I'll add as I have time.  

[JGrayDBU 338]

"1)Is it worthwhile to buy extra years service in the TRS system?  Most calculations I've done show it's not the best use of money." 

 Here are the assumptions:  Buy five years at a cost of $64k (calc. from last year).   The pension without buying years or working in Texas is $30k.  That is a pension based on 23 years.   Because of adding one year of working at a much higher salary than existed in 2018 that increases the high five avg. salary, the new pension amount is a minimum of $40k.   If I get a high paying teaching job, the pension goes up from there.   How long does it take to recoup 64k?  With those numbers it takes only 6.4 years, not including potential gains. (10k of gains x 6.4 = 64k) However, I don't plan to be super aggressive with my retirement funds in my 60s, so I am not including the gains in my calculation.   Am I going to live longer than 6.4 years after I start drawing the pension?  This plan has me starting the pension at age 61.  My family tree indicates I should live to at least mid 70s, so that is a no-brainer.  

   If you say you're talking apples to oranges, because of the difference in the high five salary I suppose we could take out the increased salary to simulate making the purchase of credit neutral wrt the high-five salary.  

If you were to do that, then the 28 years of pension is worth $36,717.66 per year. That is not considering the 29th year, which is the year I work when I come back to Texas.  However, a person is not allowed to purchase service credit unless the person is currently working for the state, so it is hard to justify making that calculation, imo.

 

 

 

 

 

 

 

 

 

 

 

[52-80 19144]

14 hours ago, Trey3216 said:

 

3)Monte Carlo simulations are fine, but you have to consider sequence of return simulations in the mix. 

Is there a Dripping Springs simulation for those of us who plan to retire to Central Texas instead of the French Riviera

[Trey3216 15343]

2 hours ago, 52-80 said:

Is there a Dripping Springs simulation for those of us who plan to retire to Central Texas instead of the French Riviera

You don’t want to see the Gun Barrel City simulations 

[StassneyHorn 6573]

How many of you guys max out on company stock plan? Company Im at let’s us do up to 15% of check and you get 15% discount on the cheaper price of the beginning or end 6 month period.

Between the price today and beginning 6 month ago with the discount made out nearly 40%

[CooterBrown 18002]

How many of you guys max out on company stock plan? Company Im at let’s us do up to 15% of check and you get 15% discount on the cheaper price of the beginning or end 6 month period.
Between the price today and beginning 6 month ago with the discount made out nearly 40%

I do. We can only do 10% of our base salary. Ours is every 6 months and you get the lower price of first or last day of the period plus a 15% discount. It’s easy money. It’s crazy not to do it. Even if you just consider it a savings account and cashed it in the same day, after taxes you’re still clearing over 7% profit no matter the stock price. No savings account would return that rate. I’ve had returns of 80% some years. I think there’s only been 2 periods where it was just the 15% discount.

[Parliament 14232]

9 hours ago, StassneyHorn said:

How many of you guys max out on company stock plan? Company Im at let’s us do up to 15% of check and you get 15% discount on the cheaper price of the beginning or end 6 month period.

Between the price today and beginning 6 month ago with the discount made out nearly 40%

I do.  We get a 15% discount.  Feels like stealing. 

[Nice Guy Eddie 13508]

I miss the days when I worked for a company that offered stock purchase programs like that. I took advantage but didn’t maximize it. Stupid.

If someone can’t easily afford to maximize it, I would recommend doing anything to suck it up for the first cycle and then you’re set for future buy/sell cycles.

one more thing, if tempted to hold onto it, don’t. Sure the stock price might skyrocket but you already depend too much on your employer with your salary. Invest the sales elsewhere.

[BehoId, The Underminer! 11669]

 

[Parliament 14232]

22 hours ago, Nice Guy Eddie said:

one more thing, if tempted to hold onto it, don’t. Sure the stock price might skyrocket but you already depend too much on your employer with your salary. Invest the sales elsewhere.

For me it's a side bet.  If the stock never does well, I'll still be fine.  If it goes bomkers?

 

[Hornbeliever 712]

On 2/4/2023 at 9:16 AM, Nice Guy Eddie said:

I miss the days when I worked for a company that offered stock purchase programs like that. I took advantage but didn’t maximize it. Stupid.

If someone can’t easily afford to maximize it, I would recommend doing anything to suck it up for the first cycle and then you’re set for future buy/sell cycles.

one more thing, if tempted to hold onto it, don’t. Sure the stock price might skyrocket but you already depend too much on your employer with your salary. Invest the sales elsewhere.

Yeah, I was an Enron trader and had those discounted options for all my bonuses.  Always chose cash money and never took the option (not out of wisdom but immaturity) and came out clean as a whistle from that debacle.

That scenario repeating is very rare but it warped my mind and have never taken said phantom stock option program when offered.  Though I did regret it once about a decade ago.

So what am I saying?  It's all luck so do what you want with knowledge you are putting all eggs in one basket.

[Dbeasy 15040]

For Monte Carlo simulations there’s a site called portfolio visualizer that’s pretty good. Allows you to run sequence of returns risks too. It’s a little intimidating of a site, but good. 

[BearSchlong 8083]

Yeah, I was an Enron trader and had those discounted options for all my bonuses.  Always chose cash money and never took the option (not out of wisdom but immaturity) and came out clean as a whistle from that debacle.
That scenario repeating is very rare but it warped my mind and have never taken said phantom stock option program when offered.  Though I did regret it once about a decade ago.
So what am I saying?  It's all luck so do what you want with knowledge you are putting all eggs in one basket.

I converted my WorldCom options within 1/4 point of the stock’s historical all-time high, resigned, and then started at Williams all in a whirlwind 1 hour on the first business day, 2000. And later on, declined an offer to join Enron’s bandwidth scheme. I can only imagine. Did they let you keep your laptop?

[Hornbeliever 712]

4 hours ago, BearSchlong said:

I converted my WorldCom options within 1/4 point of the stock’s historical all-time high, resigned, and then started at Williams all in a whirlwind 1 hour on the first business day, 2000. And later on, declined an offer to join Enron’s bandwidth scheme. I can only imagine. Did they let you keep your laptop?

See....luck.

I left Aug 2001 so my laptop and (first ever) cell phone were handed over to HR and not the FBI.

Enron Bandwidth and the Blockbuster/Enron deal were actually both ahead of their time in theory but goes to show you that great ideas need a semblance of ramp up time and can't be priced into the stock value right away.  They were trying to monetize ideas that would take a decade to turn a huge profit.

Little known nugget....I was banging a smokeshow of a stripper for a year there (again...luck, she was my neighbor) and her best client was the Bandwidth CEO.   And she would always hand me the business cards of all these enron dorks that paid a lot to see those taddies.  Please don't tell me what else she did with them.

[Parliament 14232]

3 hours ago, Hornbeliever said:

I was banging a smokeshow of a stripper for a year there...

Riiight

[Nice Guy Eddie 13508]

5 hours ago, Hornbeliever said:

See....luck.

I left Aug 2001 so my laptop and (first ever) cell phone were handed over to HR and not the FBI.

Enron Bandwidth and the Blockbuster/Enron deal were actually both ahead of their time in theory but goes to show you that great ideas need a semblance of ramp up time and can't be priced into the stock value right away.  They were trying to monetize ideas that would take a decade to turn a huge profit.

Little known nugget....I was banging a smokeshow of a stripper for a year there (again...luck, she was my neighbor) and her best client was the Bandwidth CEO.   And she would always hand me the business cards of all these enron dorks that paid a lot to see those taddies.  Please don't tell me what else she did with them.

Lou Pai, Enron exec, had the best timing that he left Enron at the right time and sold his shares before everything collapsed. I'm bringing him up as he married his favorite stripper from Treasures.  https://en.wikipedia.org/wiki/Lou_Pai

[Hornbeliever 712]

1 hour ago, Nice Guy Eddie said:

Lou Pai, Enron exec, had the best timing that he left Enron at the right time and sold his shares before everything collapsed. I'm bringing him up as he married his favorite stripper from Treasures.  https://en.wikipedia.org/wiki/Lou_Pai

Ha, that was his name!  I had forgotten.  Well, his wife was not his favorite stripper from summer 2000 to summer 2001, I can tell you that.  Homey gave lots of cash to my neighbor. 

She would have thousands of dollars on her countertop and would never lock her door.  I was in awe of her innocence (at least she had one type of sweet innocence)

[Parliament 14232]

If that doesn't make him a Surly God, I don't know what will.

 

[Dbeasy 15040]

I noticed a lot of people, myself included, are parking a lot of money into money market accounts and/or treasury bills. A 4%+ interest rate is pretty compelling. Just keep in mind that the rates will turn on a dime as soon as the indications of waning inflation are strong enough, and there will be a scramble to get out of these investments into something more profitable. 

There is something to be said for building out your bond ladders to lock-in decent rates. You could wait to do it and try to get higher rates, but the opposite could also occur.

[Murfdogg21 4412]

2 hours ago, Dbeasy said:

I noticed a lot of people, myself included, are parking a lot of money into money market accounts and/or treasury bills. A 4%+ interest rate is pretty compelling. Just keep in mind that the rates will turn on a dime as soon as the indications of waning inflation are strong enough, and there will be a scramble to get out of these investments into something more profitable. 

There is something to be said for building out your bond ladders to lock-in decent rates. You could wait to do it and try to get higher rates, but the opposite could also occur.

About a week ago I moved half our non-401k/IRA money into money markets and similar vehicles getting around 4.25%. Doesn’t seem like our boy Powell is dropping rates any time soon, and if he does then we will all be throwing money in and TINA’ing it up like it was 2020. Seemed like a good hedge with the other half in a tactical moderate to aggressive portfolio, but I’ve been terrible with my investment timings so may the odds be in yalls favor.

[Nice Guy Eddie 13508]

On 2/19/2023 at 8:40 PM, Murfdogg21 said:

About a week ago I moved half our non-401k/IRA money into money markets and similar vehicles getting around 4.25%. Doesn’t seem like our boy Powell is dropping rates any time soon, and if he does then we will all be throwing money in and TINA’ing it up like it was 2020. Seemed like a good hedge with the other half in a tactical moderate to aggressive portfolio, but I’ve been terrible with my investment timings so may the odds be in yalls favor.

While I'm still keeping a fair amount in a 3.75% savings account, I've started to build a self-administered dividend account to earn ~5% in income and continue exposure to the market. However I'm not so worried about gains/losses as I view this as buying income. I continue to invest new money and roll the income into buying more shares.

From my view the main risk is if one of my dividend stocks lowers its dividend which in turn destroy its stock price. I balance the dividends with some low and not-as-low risk stocks. I don't chase the >10% yield dividends.

I also find this strategy encourages me to save more and more like a game. If I put $1000 into it, my annual income grows by $50. And I can still sell the stocks if needed.

If someone sees flaws or limitations with this strategy, I would love it hear it.

[Dbeasy 15040]

I spent a ton of time looking at the concept of building income as part of a portfolio strategy. I don’t have any pensions so I wanted some level of consistent income. 

I’ve concluded there is a place for covering some of your expenses from income investments, but I have to be careful. Some of those income investments, particularly in public market investing, have weak total returns over time. And, it involved either stock picking or fixed income picking or etf picking.

I’m a believer in passive investing, so I decided to build a small amount of the portfolio around higher dividend investments, and increased my fixed income percentages for awhile to reduce sequence of returns risk. I’m doing part time work so not fully retired but this allows me to ensure the portfolio covers a good 35 years. 

[Redneck Mutha 7954]

3 hours ago, Nice Guy Eddie said:

While I'm still keeping a fair amount in a 3.75% savings account, I've started to build a self-administered dividend account to earn ~5% in income and continue exposure to the market. However I'm not so worried about gains/losses as I view this as buying income. I continue to invest new money and roll the income into buying more shares.

From my view the main risk is if one of my dividend stocks lowers its dividend which in turn destroy its stock price. I balance the dividends with some low and not-as-low risk stocks. I don't chase the >10% yield dividends.

I also find this strategy encourages me to save more and more like a game. If I put $1000 into it, my annual income grows by $50. And I can still sell the stocks if needed.

If someone sees flaws or limitations with this strategy, I would love it hear it.

I've done something similar recently.  Rolled much of what I'd accumulated in ESPP over the past few years (should have diversified earlier, tbh) into several solid dividend stocks across various segments.  

[B00M 6413]

On 2/19/2023 at 8:40 PM, Murfdogg21 said:

About a week ago I moved half our non-401k/IRA money into money markets and similar vehicles getting around 4.25%. Doesn’t seem like our boy Powell is dropping rates any time soon, and if he does then we will all be throwing money in and TINA’ing it up like it was 2020. Seemed like a good hedge with the other half in a tactical moderate to aggressive portfolio, but I’ve been terrible with my investment timings so may the odds be in yalls favor.

What percentage of your total money did half of your non 401k/IRA money represent? Where was it before? Equities? What motivated the move? If it was a good move for that money, why wasn’t it a good move for some 401k money? Promise this isn’t some gotcha bullshit, just trying to get your thought process as I’ve gone through similar exercises recently but i extended it into the IRAs. Overall I’m sitting at like 40% equities (75% US, 25% int’l) and 60% bonds/funds/bills/CDs/mmarkets/cash/PM/BTC … I’ll convert more cash into bonds/bills as rates go up and I’ll hold them to maturity, but I’m also keeping plenty of dry powder to dollar cost into a falling equities market once the prices get reasonable. The odds of avoiding a major recession in ‘23 seem very low to me. If I’m wrong, I think the potential upside in the markets is modest, so the 4-5% “risk free” return makes it easier to be patient. I do wonder if the proliferation of passive investing will buoy the bottom of a stock market correction but either way I’m not fighting the fed as it raises rates. 

[Trey3216 15343]

14 minutes ago, B00M said:

What percentage of your total money did half of your non 401k/IRA money represent? Where was it before? Equities? What motivated the move? If it was a good move for that money, why wasn’t it a good move for some 401k money? Promise this isn’t some gotcha bullshit, just trying to get your thought process as I’ve gone through similar exercises recently but i extended it into the IRAs. Overall I’m sitting at like 40% equities (75% US, 25% int’l) and 60% bonds/funds/bills/CDs/mmarkets/cash/PM/BTC … I’ll convert more cash into bonds/bills as rates go up and I’ll hold them to maturity, but I’m also keeping plenty of dry powder to dollar cost into a falling equities market once the prices get reasonable. The odds of avoiding a major recession in ‘23 seem very low to me. If I’m wrong, I think the potential upside in the markets is modest, so the 4-5% “risk free” return makes it easier to be patient. I do wonder if the proliferation of passive investing will buoy the bottom of a stock market correction but either way I’m not fighting the fed as it raises rates. 

Why don't you reinvest interest income from bonds/bills into equities on the way down?  Even if it takes some time, the upside of future equity gains with incrementally larger holdings is still going to beat reinvestment into bonds?   Not a gotcha comment either, just seeing what you're thinking.  

[B00M 6413]

11 minutes ago, Trey3216 said:

Why don't you reinvest interest income from bonds/bills into equities on the way down?  Even if it takes some time, the upside of future equity gains with incrementally larger holdings is still going to beat reinvestment into bonds?   Not a gotcha comment either, just seeing what you're thinking.  

I hadn’t thought of it in that way but that’s exactly what will be happening … I don’t see sustaining these elevated rates for very long. Maybe another year? So I’ll try to stay nimble and take advantage of the inverted yield curve with a mix of short duration shit.

If I were confident in the fed’s long term ability to tackle inflation, I’d buy 20 and 30 year treasury bonds. Maybe I will anyway as an optimistic hedge I can point and laugh at with my kids in 20 years.

From what I can gather it takes 9-18 months for the economy to reveal the effects of fed rate hikes. That’s when the corporate and consumer bankruptcies will accelerate right? And 9 months ago, May ‘22 we were at 0.77% … we finally hit 3% in October. The stock market is still assuming there will be an early pivot and a soft landing or “no landing” or some other pain free fantasy that my inner bear just can’t agree with. It helps that I think I can afford to be conservative. 
 

[Murfdogg21 4412]

16 hours ago, B00M said:

What percentage of your total money did half of your non 401k/IRA money represent? Where was it before? Equities? What motivated the move? If it was a good move for that money, why wasn’t it a good move for some 401k money? Promise this isn’t some gotcha bullshit, just trying to get your thought process as I’ve gone through similar exercises recently but i extended it into the IRAs. Overall I’m sitting at like 40% equities (75% US, 25% int’l) and 60% bonds/funds/bills/CDs/mmarkets/cash/PM/BTC … I’ll convert more cash into bonds/bills as rates go up and I’ll hold them to maturity, but I’m also keeping plenty of dry powder to dollar cost into a falling equities market once the prices get reasonable. The odds of avoiding a major recession in ‘23 seem very low to me. If I’m wrong, I think the potential upside in the markets is modest, so the 4-5% “risk free” return makes it easier to be patient. I do wonder if the proliferation of passive investing will buoy the bottom of a stock market correction but either way I’m not fighting the fed as it raises rates. 

Feel free to gotcha because I’m ignorant.  Roughly 70% of investments were non-retirement. We made some cash off selling a home in 2021 and wanted beat inflation and hopefully make some money with the BRRRRR and TINA YOLO of 2020 & 2021. It wasn’t a strictly long term for us either, because we wanted flexibility to jump back in on good value real estate. EPICFAIL on the market timing (Q4 2021 entry). The portfolio was fairly aggressive, mostly stocks with eye on retirement 25+ years out. My investment manager calls me a pussy every time I try to go conservative when the market bounces up on a bear rally. This last round, treasury yields and money market rates are so high it was hard to argue against, but we still only moved half (about ~37% of total invested assets) to catch the 4.25+% as a hedge for further market decline in 2023. I could easily be talked into moving it all though to ride through the recession and fallout risks and jump back in in 2024.

[Nice Guy Eddie 13508]

There is a comment above about a potential US recession and the presumption that stocks will go down or barely rise. I tend to think that we've already run into the stock fallback and any realized recession would be met with lowering of interest rate that would supercharge the stock market. 

Zero expertise and don't take my word but I think 2023 will be a fantastic year to have money in the market. People need to take their risk tolerance into account but I don't think anyone should be looking to pull money out of the market now. In hindsight that sell opportunity was a year ago so be careful about missing out on the return to all time highs.

EDIT: I'm up ~5.2% on my retirement accounts this year even after the last week was so bad. I don't see any reason that it couldn't be north of 20% by the end of the year.

Background: when I've sold some at the bottom, I've found it hard to get that money back into a rising market. I attempt to time the market even more and completely fail at it.

Edited February 22, 2023 by Nice Guy Eddie

[Trey3216 15343]

33 minutes ago, Nice Guy Eddie said:

There is a comment above about a potential US recession and the presumption that stocks will go down or barely rise. I tend to think that we've already run into the stock fallback and any realized recession would be met with lowering of interest rate that would supercharge the stock market. 

Zero expertise and don't take my word but I think 2023 will be a fantastic year to have money in the market. People need to take their risk tolerance into account but I don't think anyone should be looking to pull money out of the market now. In hindsight that sell opportunity was a year ago so be careful about missing out on the return to all time highs.

EDIT: I'm up ~5.2% on my retirement accounts this year even after the last week was so bad. I don't see any reason that it couldn't be north of 20% by the end of the year.

Background: when I've sold some at the bottom, I've found it hard to get that money back into a rising market. I attempt to time the market even more and completely fail at it.

I think, at best, the market will do about 5% this year.  Too much uncertainty.  The stock market isn't going to get supercharged until the bond market gets itself figured out, and that is a total shitshow right now.  When you see a 6+month period that High Yield Corporate debt is up 8-15%, then you can expect stocks to figure out that they're headed up.  Until then...   

[B00M 6413]

7 minutes ago, Nice Guy Eddie said:

There is a comment above about a potential US recession and the presumption that stocks will go down or barely rise. I tend to think that we've already run into the stock fallback and any realized recession would be met with lowering of interest rate that would supercharge the stock market. 

Zero expertise and don't take my word but I think 2023 will be a fantastic year to have money in the market. People need to take their risk tolerance into account but I don't think anyone should be looking to pull money out of the market now. In hindsight that sell opportunity was a year ago so be careful about missing out on the return to all time highs.

Background: when I've sold some at the bottom, I've found it hard to get that money back into a rising market. I attempt to time the market even more and completely fail at it.

 

yeah a return to ATH would be tough to cope with (hence my 40% exposure) but I think that’s the least likely scenario in ‘23 … if history is any indication we may not sniff ATH for another 5-8 years. 

Historically, the fed waits until it‘s too late, so lowering the interest rates doesn’t stop the free fall. 

If there’s an example of the fed pivoting to prevent a recession, its just prior to covid, but covid muddies the water there. 
 

random internet chart comparing fed funds rate and S&P500:

 

[StassneyHorn 6573]

What are you guys doing with annual bonus?

Annual cash bonus is coming in two weeks. Didn’t have any major spending plans at the moment. Is deposit into Vanguard money market smart ir am I missing something obvious? Didn’t want to necessarily start a CD ladder cause I wanted freedom to invest at drop of a hat with no penalty. Considered putting the whole thing into 401k but chose against in case of any old townhome repairs.

[Seger78 258]

23 minutes ago, StassneyHorn said:

What are you guys doing with annual bonus?

Annual cash bonus is coming in two weeks. Didn’t have any major spending plans at the moment. Is deposit into Vanguard money market smart ir am I missing something obvious? Didn’t want to necessarily start a CD ladder cause I wanted freedom to invest at drop of a hat with no penalty. Considered putting the whole thing into 401k but chose against in case of any old townhome repairs.

 

[Archer 474]

4 hours ago, StassneyHorn said:

What are you guys doing with annual bonus?

Annual cash bonus is coming in two weeks. Didn’t have any major spending plans at the moment. Is deposit into Vanguard money market smart ir am I missing something obvious? Didn’t want to necessarily start a CD ladder cause I wanted freedom to invest at drop of a hat with no penalty. Considered putting the whole thing into 401k but chose against in case of any old townhome repairs.

Part in the market, part on the mortgage, and part put back for commercial real estate. 
 

I view the mortgage as my safe investment and everything else is in equities. 

[Parliament 14232]

14 hours ago, StassneyHorn said:

What are you guys doing with annual bonus?

Annual cash bonus is coming in two weeks. Didn’t have any major spending plans at the moment. Is deposit into Vanguard money market smart ir am I missing something obvious? Didn’t want to necessarily start a CD ladder cause I wanted freedom to invest at drop of a hat with no penalty. Considered putting the whole thing into 401k but chose against in case of any old townhome repairs.

[gmr548 16576]

What are you guys doing with annual bonus?
Annual cash bonus is coming in two weeks. Didn’t have any major spending plans at the moment. Is deposit into Vanguard money market smart ir am I missing something obvious? Didn’t want to necessarily start a CD ladder cause I wanted freedom to invest at drop of a hat with no penalty. Considered putting the whole thing into 401k but chose against in case of any old townhome repairs.

Nothing glamorous. Mostly padding cash savings (replenishing emergency fund after recent medical expenses, saving for home purchase, etc.). Will probably invest a portion of it.

[UT_OB1 2213]

Just hoping it lasts to squeak by until next years bonus, just like last years. Isn’t that how it works?

[Nice Guy Eddie 13508]

My plan for the annual bonus to build a pool but I worry about my cheap boss not coming through on the promised bonus. But first I have to worry about my rural cousin and his family coming for a stay. At least they’re staying in the RV out front instead of taking up a bedroom.