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[natedagg]

Hey all...figured i'd ask for some advice since i just recently received a decent chunk of change ($6,200) from my grandmother's estate sale. I currently have no debt but also have little money saved in any formal sort of way. I always keep my bank account above a certain number (basically acts as my rainy day fund equalizer) but have no formal savings account set up. With that said, i was thinking of putting a large portion of it into Vanguard index funds. Aside from planning to purchase a new phone, i don't have any real big needs at the moment. Was curious to hear other's ideas / thoughts on what to do with that amount of money?

Reading everything after this post reminded me why I stay out of here...

Get your cash up to 3-6 months living expenses, depending on the stability of your income and your job.

I would stack your $ relentlessly until you can buy a cheap house, but that's personal preference. I can't see how you can go wrong w a cheap house that can ultimately turn into a rental property. Rates are soooooo low, this is the only way you can leverage your $ properly at the moment. This also gives you some control over the outcome, and flexibility to live there, rent it, or sell it.

The US markets are extremely expensive right now, CAPE ratio is what 29? If you insist on going this route, then do the Roth.

 

[Lee]

Hey guys, I just recently started saving for retirement. I'm 27. I have a roth 401k that is going 100% into the JMVSX fund. I selected it because it seemed to be the highest rated mutual fund I was allowed to select. Is this a good mutual fund? I'm new to stocks, but it was 5 stars on Morningstar. I will try to remember to post my other mutual fund/target date fund options later today.

I always look at a 10 year history if available, a 5 year history (will not go into a fund without 1), a 12 month history and ytd history.

I then compare the track record, and every quarter i look again.

Who is your 401k through?

 

[The Process God]

I always look at a 10 year history if available, a 5 year history (will not go into a fund without 1), a 12 month history and ytd history.

I then compare the track record, and every quarter i look again.

Who is your 401k through?

Vitamin Shoppe. 100% match for first 3%, then 50% for the next 2, so, when I max out the match, they put in 80 cents for every dollar I put in.

When I get home from work, I will post my other mutual fund options.

 

[The Process God]

So, after doing some more research, I switched from JMVSX to TRSAX for my retirement mutual fund. Better returns across any time span up to the life of each mutual fund, and the cost ratio is .93 vs .99. Better returns on top of less money spent on the fund manager. What's not to like. I know it's a large cap fund, but its performance is excellent. 43% is in tech, which I also like. Additionally, being a large cap fund, it's stability will be good as well because it is comprised of well-established companies.

My wife and I also received some money for our wedding that has been sitting in XOM for a while and not moving much because she wanted us to keep it for a down payment on a house, and, despite her wishes of keeping it in stock and not going towards debt, I secretly put it towards credit card debt anyway because a guaranteed 17% reduction in yearly interest is going to beat out most investments. Not to mention the better credit score in the meantime. Plus i recently signed up for a credit card that charges no fees or higher APRs for cash advancements, and the APR is only 6.9% as it is, so, if I have to present the money immediately, I have that option. But I plan on just making the money back before we are ready to buy a house since we won't buy a house until we are out of credit card debt anyway. I wont ever tell her i did this, but she will thank me indirectly through the results we see financially.

 

[Ob1]

So, after doing some more research, I switched from JMVSX to TRSAX for my retirement mutual fund. Better returns across any time span up to the life of each mutual fund, and the cost ratio is .93 vs .99. Better returns on top of less money spent on the fund manager. What's not to like. I know it's a large cap fund, but its performance is excellent. 43% is in tech, which I also like. Additionally, being a large cap fund, it's stability will be good as well because it is comprised of well-established companies.

My wife and I also received some money for our wedding that has been sitting in XOM for a while and not moving much because she wanted us to keep it for a down payment on a house, and, despite her wishes of keeping it in stock and not going towards debt, I secretly put it towards credit card debt anyway because a guaranteed 17% reduction in yearly interest is going to beat out most investments. Not to mention the better credit score in the meantime. Plus i recently signed up for a credit card that charges no fees or higher APRs for cash advancements, and the APR is only 6.9% as it is, so, if I have to present the money immediately, I have that option. But I plan on just making the money back before we are ready to buy a house since we won't buy a house until we are out of credit card debt anyway. I wont ever tell her i did this, but she will thank me indirectly through the results we see financially.

Do you have an S&P 500 fund or a total stock market index fund as an option? .93% fees are way too high. Most Passive Index funds are .20 or less and over the life of your retirement that could save you tens of thousands of dollars.

 

[The Process God]

Do you have an S&P 500 fund or a total stock market index fund as an option? .93% fees are way too high. Most Passive Index funds are .20 or less and over the life of your retirement that could save you tens of thousands of dollars.

S&P 500 has a 15-year return of 6.06% per year on average. TRSAX, the fund i currently have, has a return of 9.48% over a the last 15 years. Even with a .93% fee, wouldn't that still make me more money in the end? 9.48 - .93 = 8.55% > 6.06% (even with no fees).

For mutual funds, my options are CISIX, DSPIX, HLIEX, TRSAX, JMVSX, MASKX, FCIGX, and PPVIX. Then there are two options for international stocks (2-3% returns), and a bunch of target date funds. I compared prior returns minus the fees, and TRSAX came out on top. The DSPIX option is basically my S&P 500 option, and its fees are only .21%, but the lesser returns don't seem worth it to me unless my math is somehow off.

 

[The Process God]

S&P 500 has a 15-year return of 6.06% per year on average. TRSAX, the fund i currently have, has a return of 9.48% over a the last 15 years. Even with a .93% fee, wouldn't that still make me more money in the end? 9.48 - .93 = 8.55% > 6.06% (even with no fees).

For mutual funds, my options are CISIX, DSPIX, HLIEX, TRSAX, JMVSX, MASKX, FCIGX, and PPVIX. Then there are two options for international stocks (2-3% returns), and a bunch of target date funds. I compared prior returns minus the fees, and TRSAX came out on top. The DSPIX option is basically my S&P 500 option, and its fees are only .21%, but the lesser returns don't seem worth it to me unless my math is somehow off.

Actually, I just looked it up, apparently any mutual funds' reported earnings are net of expenses, so it is a true 9.48% return over the past 15 years in my instance. So why couldnt I just flatly compare two mutual funds' performance against one another since that is the case?

 

[Lee]

S&P 500 has a 15-year return of 6.06% per year on average. TRSAX, the fund i currently have, has a return of 9.48% over a the last 15 years. Even with a .93% fee, wouldn't that still make me more money in the end? 9.48 - .93 = 8.55% > 6.06% (even with no fees).

For mutual funds, my options are CISIX, DSPIX, HLIEX, TRSAX, JMVSX, MASKX, FCIGX, and PPVIX. Then there are two options for international stocks (2-3% returns), and a bunch of target date funds. I compared prior returns minus the fees, and TRSAX came out on top. The DSPIX option is basically my S&P 500 option, and its fees are only .21%, but the lesser returns don't seem worth it to me unless my math is somehow off.

The last 15 is not a great predictor for allot in my opinion. We had about a 8 year run in there with the market crash that was as historically significant as the Great Depression.

I would continue to monitor just in case. I think within the next 12 months things are going to change dramatically again in the finance sector.

My point is i would start looking at a more conservative approach and keep it on the back burner so I can switch quickly once the market begins to tank. (I am thinking more Bond heavy mutual funds)

 

[The Process God]

The last 15 is not a great predictor for allot in my opinion. We had about a 8 year run in there with the market crash that was as historically significant as the Great Depression.

I would continue to monitor just in case. I think within the next 12 months things are going to change dramatically again in the finance sector.

My point is i would start looking at a more conservative approach and keep it on the back burner so I can switch quickly once the market begins to tank. (I am thinking more Bond heavy mutual funds)

Would a 5 year be better? Besides, the stock market only took two years to get back to where it was before the crash.

And I'm definitely open to switching if the market is going to go down, but why do you think it will? Is it just because it has seen too much success recently for the pendulum to not swing the other direction.

 

[Lee]

Would a 5 year be better? Besides, the stock market only took two years to get back to where it was before the crash.

And I'm definitely open to switching if the market is going to go down, but why do you think it will? Is it just because it has seen too much success recently for the pendulum to not swing the other direction.

1, i think too much to quick, thus a huge dip.

2. if trump gets booted, we will see a crash. I am just scared that trump does something that gets him impeached causing him to resign.

 

[Triplethreat]

I respectfully disagree.

These companies are becoming more and more valuable as they begin raking in more and more revenue and posting good earnings.

The market will be fine, and if it does happen to crash, POUR whatever you have in cash in because if there's anything we know it will always bounce back stronger. It's get rich quick at that time.

I'm about to invest a good chunk into BABA, because there is just so much untapped potential in that giant.

I am however 24, so risk now doesn't mean too much to me.

 

[Lee]

I respectfully disagree.

These companies are becoming more and more valuable as they begin raking in more and more revenue and posting good earnings.

The market will be fine, and if it does happen to crash, POUR whatever you have in cash in because if there's anything we know it will always bounce back stronger. It's get rich quick at that time.

I'm about to invest a good chunk into BABA, because there is just so much untapped potential in that giant.

I am however 24, so risk now doesn't mean too much to me.

Market will crash, not if, but when.

Market will recover, not if but when.

I am thinking it happens in the next year or so, just becareful. Idea is long term, but best idea is get out on the way down well before bottom, get back in after bottom on the way back up.

Do that and you will easy double your money in 2-3 years. Its a trick though, and everyone is trying to do it.

 

[Pick6]

Market will crash, not if, but when.

Market will recover, not if but when.

I am thinking it happens in the next year or so, just becareful. Idea is long term, but best idea is get out on the way down well before bottom, get back in after bottom on the way back up.

Do that and you will easy double your money in 2-3 years. Its a trick though, and everyone is trying to do it.

I too agree a crash is coming sooner rather than later, especially with Trump's....recklessness. You know your stuff Lee. I like to think I do some too. I think attempting to time the market is a very risky move. Keep pumping it in there. Dollar cost averaging.

 

[Lee]

I too agree a crash is coming sooner rather than later, especially with Trump's....recklessness. You know your stuff Lee. I like to think I do some too. I think attempting to time the market is a very risky move. Keep pumping it in there. Dollar cost averaging.

Timing isnt huge risk, that is why i am saying be prepared. No way you pull at the top and get back in at the bottom, but you can come decently close if you are in tune with the signs.

 

[TopGun]

Timing isnt huge risk, that is why i am saying be prepared. No way you pull at the top and get back in at the bottom, but you can come decently close if you are in tune with the signs.

I think so many people are thinking like this that it will be a self-fulfilling prophecy type of deal. Even if there is no obvious cause for a crash, speculators and emotional investors will eventually manufacture one.