Stock Investing

[mistakey]

@mission27

[LETSGOBROWNIES]

😬 

[Heimdallr]

I really hope that isn't surprising to anyone. 

[LETSGOBROWNIES]

30 minutes ago, Heimdallr said:

I really hope that isn't surprising to anyone. 

I’m sure it’s not, but it’s never fun to read.

[holt_bruce81]

On 1/2/2019 at 11:43 AM, ramssuperbowl99 said:

That's good. Hopefully the remainder is fairly low interest?

I would start here:

As much as it's reddit and fairly broad, this is a solid place to start thinking about how you want to handle your money. The first thing you would want is to get a detailed plan of what you make, what expenses you have, and how much debt you have (exact amounts and interest rates). That way you've got everything in front of you and can start planning accordingly.

IIRC, you've got surgery coming up and a kid on the way, so priority number 1 needs to be your emergency fund, unless you have any debts that are at like 25% interest. Investing doesn't do you any good if you're adding on debt due to missing work or having some expected or unexpected healthcare expenses come up.

Once we get that emergency fund where you feel comfortable (with 2 young kids, I'd think you would probably want at least 3 months expenses), then you can start crushing debt. Here's a good site to help with that type of planning: https://unbury.me/ Enter in the info, say how you want to tackle things (snowball or avalanche - there's more detail in the reddit post above), and it will start giving you timeframes. I think if the goal is to get you into a house, the snowball method would probably make more sense.

Hey this is great! Big thanks 

[mission27]

6 hours ago, mistakey said:

@mission27

Yup

People doubt me

[mission27]

5 hours ago, Heimdallr said:

I really hope that isn't surprising to anyone. 

Same folks who are always surprised by this stuff.  Nothing ever changes.

[ramssuperbowl99]

16 hours ago, Heimdallr said:

I really hope that isn't surprising to anyone. 

I mean it may be surprising to one person. But it's not to anyone with an idea of even basic economics. That said, just because trade wars are pointless and stupid doesn't mean that you have to act on that information short term.

[IrishGreen]

home owner bros/future home owner bros:

what was/is your approach in saving for the down payment on a house? just all cash? all investments? combo of both? (if so what allocation)

i personally think we're in a bear market at minimum, so my gut says just stay in cash, but since i have no plans to buy for 5-7 years, part of me thinks i should at least play the averages and put some into long run mutual funds (since i have no idea how long this will last, etc).

just looking for 2 cents. thx

[LETSGOBROWNIES]

10 minutes ago, IrishGreen said:

home owner bros/future home owner bros:

what was/is your approach in saving for the down payment on a house? just all cash? all investments? combo of both? (if so what allocation)

i personally think we're in a bear market at minimum, so my gut says just stay in cash, but since i have no plans to buy for 5-7 years, part of me thinks i should at least play the averages and put some into long run mutual funds (since i have no idea how long this will last, etc).

just looking for 2 cents. thx

Depends what you mean by a down payment imo.

3.5% FHA loan, meaning 5-15k? Nothing wrong with keeping that in cash imo, especially if the 5 years could possibly become 3 years.

If you’re talking larger sums of money and you’re certain it’s 5 years at a minimum, perhaps putting it in the market would be a better option.  Selecting an investment with decent dividends can help offset any potential decline in value too.

[IrishGreen]

sorry should’ve done more details

assume 20% down, high COL area, no desire to buy within next 5 years or so due to career/don’t wanna deal with maintenance of one, etc

also know all the details of personal finance. just looking for input on others’ approaches to it. 

 

[theJ]

17 hours ago, IrishGreen said:

sorry should’ve done more details

assume 20% down, high COL area, no desire to buy within next 5 years or so due to career/don’t wanna deal with maintenance of one, etc

also know all the details of personal finance. just looking for input on others’ approaches to it. 

 

If i were in your shoes, i'd put it in a basic ETF index fund tracking the S&P.  If you have the money already saved, i'd put it in slowly over the next 6 months to a year.  If your'e still saving it, i'd just put it in monthly or bi-monthly.  You could try to time it a little given that it looks like it'll go down for a little bit yet.  But ultimately, no matter which approach you take, it probably won't make a huge difference on the math in the end.

My reasoning behind investing it is the time frame.  At 5 years, your chances of losing money are very slim.  There are basically no 5 year spans where the stock market lost money overall.  

Also, if we are in some sort of bigger downturn at the moment, then it lessens your chances of seeing another one in the next 5 years.  

[theJ]

20 hours ago, LETSGOBROWNIES said:

If you’re talking larger sums of money and you’re certain it’s 5 years at a minimum, perhaps putting it in the market would be a better option.  Selecting an investment with decent dividends can help offset any potential decline in value too.

I think if we're talking a 5 year window and a basic S&P index fund, the chances of losing money are very very very slim.

[ramssuperbowl99]

59 minutes ago, theJ said:

If i were in your shoes, i'd put it in a basic ETF index fund tracking the S&P.  If you have the money already saved, i'd put it in slowly over the next 6 months to a year.  If your'e still saving it, i'd just put it in monthly or bi-monthly.  You could try to time it a little given that it looks like it'll go down for a little bit yet.  But ultimately, no matter which approach you take, it probably won't make a huge difference on the math in the end.

My reasoning behind investing it is the time frame.  At 5 years, your chances of losing money are very slim.  There are basically no 5 year spans where the stock market lost money overall.  

Also, if we are in some sort of bigger downturn at the moment, then it lessens your chances of seeing another one in the next 5 years.  

Agreed. The other side of this is how firm the 5 year window is. If the market does poorly over 5 years, are you willing to wait an extra year or two? I'm in a similar situation, and am investing it because I don't absolutely need to be in a house within the next few years.

[theJ]

11 minutes ago, ramssuperbowl99 said:

Agreed. The other side of this is how firm the 5 year window is. If the market does poorly over 5 years, are you willing to wait an extra year or two? I'm in a similar situation, and am investing it because I don't absolutely need to be in a house within the next few years.

Conversely, i'm also saving for a house, but didn't invest in the market.  We started saving about 3 years ago, and said our window was about 3 years.  We're going to start shopping this summer, and boy am i glad that i didn't invest it.  

If our window was longer, i wouldn't be worried at all.  i'm pretty confident that the market can recover from just about anything in 2 years.