Sell stocks, buy chips.
Buy stock.... in chips?
Sell stocks, buy chips.
buy low fee index ETFs, preferably from Vanguard.
1 | Vanguard Total Stock Market Index Fund Investor Shares | 41.7% |
2 | Vanguard Total International Stock Index Fund Investor Shares | 26.8% |
3 | Vanguard Total Bond Market II Index Fund Investor Shares** | 22.2% |
4 | Vanguard Total International Bond Index Fund Investor Shares | 9.3% |
1 | Vanguard Total Stock Market Index Fund Investor Shares | 54.3% |
2 | Vanguard Total International Stock Index Fund Investor Shares | 35.6% |
3 | Vanguard Total Bond Market II Index Fund Investor Shares** | 7.1% |
4 | Vanguard Total International Bond Index Fund Investor Shares | 3.0% |
If there is one thing this thread has done, it's forced me to actually calculate the current value of my assets. My exposure is currently 45% USA, 45% Europe and 10% Asia. Of that 70% is property, 27% equities and 3% bonds. I can't touch the non-USA assets without large tax exposures so they have to stay as is. My US assets are 50% property, 44% equities and 6% bonds. These %s will remain broadly constant as I pay off the house and contribute to my 401k/HSA. I'm looking at earliest 12 years before retirement at which time both kids will be done with college and the house will be paid off.
Overall, I think I'm doing the right things and not taking too much risk while still having my money work for me. The more I think about it, the less I see need for change.
Finally someone got the joke!I was adviced to go long on cattle manure certificates, which was bull shit.
I’m no expert, but I wouldn’t get too fancy. 3-6 is plenty. Total US stock market, S&P 500, total global stock market (or Europe only), US bond, US small cap stock, US dividend stock. If you really feel the need for sector exposure, maybe tech, healthcare and/or real estate.Any recommendations on specific Vanguard ETF's and a balanced portfolio allocation? Thanks
Keep in mind that in most cases your first $70,000 in long term gains + qualified dividends is tax free for that year,
Ha! Doesn't look like I'll be seeing any gains on my growing sample set collection anytime soon.Congress decided to create a special tax schedule for long term gains and "Qualified" dividends. This isn't new, it has been around one way or another for decades. The idea was to take into account the effects of double taxation and inflation by lowering the tax rates.
The IRS, as it often does, took a relatively simple idea and turned it into an obtuse form to figure out. Or, if you use tax software, you might not even notice the effect of the special rate.
For married people being taxed on long term capital gains plus qualified dividends:
0% up to $78,750
15% from $78,751 to $488,850
20% there after.
Enjoy! -=- DrStrange
PS long term gains on poker chips are taxed as if they were ordinary income. No kidding, there is a special place in tax hell for gains on "collectables".
My whole 2 cents. But I'm not retired, so take it for what it's worth.A buddy of mine was a hedge fund manager and he saw the writing on the wall in 2007 and sold out his entire personal portfolio before the crash in 2008. He came back into the market to ride the recovery. He's retired now (at age 44) and I met him for a poker game last month in London and we got a good chance to chat while the other players arrived. He told me that he just sold his entire portfolio and is holding on to cash. He said that there may be a max of 10% upside left in the market before there will be a crash.
His view may be a European/British-centric and also protecting his assets since he's retired but markets are global and the trends spread. I'm debating whether I should move my money out of the market. I lost 5% on Monday and while it's recovered some, the signs are of continued trade challenges and a slowing Chinese economy which will in turn impact the US economy. China is the US's biggest trading partner and Europe is already depressed and Brexit will definitely make it worse. The inverted bond yield shows the signs that the market is already pricing in short term depression.
Sell?
I'm also toying with the idea of moving a chunk of my 401k savings into bonds (from 10% of my holdings to 20%).
I understand this strategy, but I have to ask if/when do you plan to get back in to equities? Not sure how old you are but I suppose that is a very important part of the plan. If the market dropped 10% next week would you buy? Do you wait for a new president?My whole 2 cents. But I'm not retired, so take it for what it's worth.
I am currently 40% in bonds and 60% in stocks. Moving toward 50/50 over the next few months.
I don't over think it too much. We are at new all time highs every week, so I move a little bit more out every time we hit a new high. For every new 1% up I move 5% out.
Two factors to consider.I understand this strategy, but I have to ask if/when do you plan to get back in to equities? Not sure how old you are but I suppose that is a very important part of the plan. If the market dropped 10% next week would you buy? Do you wait for a new president?
I'm NOT asking for a friend. I'm asking because I'm sure I am too conservative with our retirement money! This is crazy but I had a weird feeling around 2008 and sold everything. I was feeling great about my decision for a few years! The problem is although I slowly bought back in over time I know I lost tons of potential gains by my scaredy-cat nature and never really bought back in fully. Honestly I think I would have been better off financially (but not mentally) if I had done nothing.
...Honestly I think I would have been better off financially (but not mentally) if I had done nothing.
I did and I am happy. I have never put pencil to paper to see what would have been the result had I done nothing but the market being at all time highs coupled with me still under 100% invested tells me I lost money.If you sold of in 2008 (I wish I had, I would have tons more chips and guitars lol), and slowly got back in, you should be pretty happy with your returns unless you purch individual non-performing stocks. Market as a whole has been fantastic over the last 3 years
I'm an idiot, to take it as that, but I saw my family lose most of there stability during the last one. I'm relying more on real estate for retirement then stocks based on that. But, there are alot smarter people out there then me and I don't have any kids to put the wealth (I use that term lightly) towards when I die of heart failure in 6 years at 44.
Exactly. I saw so many people lose their shirt in 2008 that it cured me from wanting to be involved with the market and mutual funds. Real estate development, rental properties, or direct investment with a company is the way to go. I find it surprising how accepted it is to still put large amounts of personal net worth into the market.
From my perspective, stocks and mutual funds are just gambling - way too volatile and outside of my control. We have been given a narrative that continuing to invest in stocks/mutual funds over the long term is the wise way to invest but I don't buy that at all.
I wish I had lost my shirt just in 2008. lol. I agree. The stock market is pretty much a casino where the house (brokers) takes a cut regardless and always wins. If you're lucky, the market would have been on a good run just before you need to cash out for retirement
The so called financial gurus continue touting the market as the wise mans road to success. What about the people that invested in the market their whole working life only to have their retirement thwarted after losing 40% of their portfolio in 2008? Some people I know were retired or planning to retire and had to go back to work.
I watched an interesting series a while ago that explained the history of the 401k plan. The 401k was not created as a way to help people and encourage employees to save. The 401k came into effect as a way to avoid having to give pensions. Pensions proved very costly so 401k. were created to replace them and allow companies to still offer a perk without giving away the farm IIRC.
The difference between 401k’s and pensions is quite stark.
A 401k has no diversification of risk amongst its participants. There is only one participant, with one retirement time horizon, and thus the owner is exposed to the maximum amount of market risk.
A pension, on the other hand, has significant diversification of risk amongst its participants. A pension has many, many participants, with varying retirement time horizons, some young, some middle-aged, and some old, all contributing to the pool. Thus, any given market event will not have a meaningful impact on any given participant.
2008 might have been catastrophic to a 401k owner, but it was essentially a non-event to pension plan participants.
It is the same concept as a large pool of participants in a health plan. Diversification of risk.
401k’s are what happens when the populace at large stops paying attention, and gets sold a bill of goods. Interesting that one political party keeps demonizing unions and organized labor (for a variety of reasons); but notice that those groups were smart enough to resist the elimination of their pension funds. I’m not saying that 401k’s are a bad idea in toto, just that they were originally intended as a supplement to pensions, but special interests have succeeded in gutting the traditional pension by pointing to 401k’s.
I agree with this but being a lifelong rust belter I have seen dubious investments and worse by these pension plans over and over again. Many of our truck drivers are represented by a union whose business manager sold his own house to the pension plan for a huge profit. There was a story in the Free Press yesterday about the Carpenter’s Union cutting benefits again due to terrible and sometimes illegal investments. I told myself long ago I’d rather be in charge of my own destiny and money. We also had drivers who were Teamsters, and don’t even get me started on what happened in that pension plan. It seems to me whomever has power seems to abuse it.The difference between 401k’s and pensions is quite stark.
A 401k has no diversification of risk amongst its participants. There is only one participant, with one retirement time horizon, and thus the owner is exposed to the maximum amount of market risk.
A pension, on the other hand, has significant diversification of risk amongst its participants. A pension has many, many participants, with varying retirement time horizons, some young, some middle-aged, and some old, all contributing to the pool. Thus, any given market event will not have a meaningful impact on any given participant.
2008 might have been catastrophic to a 401k owner, but it was essentially a non-event to pension plan participants.
It is the same concept as a large pool of participants in a health plan. Diversification of risk.
401k’s are what happens when the populace at large stops paying attention, and gets sold a bill of goods. Interesting that one political party keeps demonizing unions and organized labor (for a variety of reasons); but notice that those groups were smart enough to resist the elimination of their pension funds. I’m not saying that 401k’s are a bad idea in toto, just that they were originally intended as a supplement to pensions, but special interests have succeeded in gutting the traditional pension by pointing to 401k’s.
2008 might have been catastrophic to a 401k owner, but it was essentially a non-event to pension plan participants.
I'm an idiot, to take it as that, but I saw my family lose most of there stability during the last one. I'm relying more on real estate for retirement then stocks based on that. But, there are alot smarter people out there then me and I don't have any kids to put the wealth (I use that term lightly) towards when I die of heart failure in 6 years at 44.
Yeaaahhh. You are smarter then me. I just buy a crappy house. Then sell it when it's worth more. Then I buy a crappy house.Real estate played a key role in causing the Great Recession. (Technically mortgage backed transferable securities) I knew plenty of people upside down or that lost a lot during that time in real estate. I keep going back to the same idea, you need to know your investments very, very well.
Real estate can be a solid investment but it can also be a poor investment. I was actually talking to someone last week about their real estate holdings. They are making less than 1% return in equity. So, I asked them why not just sell and get some T Bonds? Ultimately, reading between the lines, they just like the sound of being a real estate investor.
Anyway, best wishes.
Jon
Not flipping, but I limit risk by never buying anything I can't afford for a long term.Sounds like you are smart to me. Flipping can be great, no long term worries, usually.