I have a stupid but practical question: how do I go about actually getting the money moved from my current investments to something I can manipulate like Vanguard?
I have a stupid but practical question: how do I go about actually getting the money moved from my current investments to something I can manipulate like Vanguard?
In reply to Duke:
Go to the Vanguard website. It will step you through opening an account and transferring funds or investments. I consolidated all my investments there, including non-Vanguard funds and stocks.
1) I recently read a great post on Reddit about a guy who teaches Financial Planning and he often convinces both rich and poor, financial advisers and housewives to attend his classes for input. He usually does a survey and he said that 9 times out of 10, the people who knew what they were doing were using Bettermint combined with Roth IRA and Traditional 401k with VTSMX. The folks who were clueless were using an Adviser. The Advisers were using Bettermint.
2) What's a good mix for Active Investment/Roth IRA/Traditional 401k? We've both got our 401ks invested in Vanguard Index funds. We want to open a Roth IRA and contribute to the max. I'm not sure we should bother with Bettermint or Active Investment.
3) We want "partial early retirement" by the time we're in our late 40's. I think we both intend to work until retirement (due to effin healthcare), but it would be nice to have $1000 a month coming in without working by the time say...kids are in highschool if we had a baby next year. I'm 33, she's 30, should we just put our contributions in 2025 Target Funds?
In reply to Basil Exposition:
OK, thanks. I may or may not do that - I definitely want the best tax advantage I can get, so I may hire a fiduciary instead - but I want to know how. I'm mostly in annuities right now, for financial aid reasons, but when those mature I want to put that money elsewhere for the final sprint to retirement and beyond.
In reply to pheller:
Robo advisors like Betterment and Wealthfront do a decent job of keeping fees low compared to financial planners/advisors, but they're still a middle man that is going to take a cut of your money to keep their lights on. If you don't want to do anything but click a button, and have your money invested for you based on your risk tolerance then they work well but most people here are more than capable of doing the same thing on their own with minimal effort. They do offer some benefits like tax harvesting, but that's probably not a big factor for Grassroots investors after the fees are considered. Also, I read recently that their fee structure had changed a bit and it wasn't the type of change that would benefit their customer.
Putting money in a Roth IRA, and maxing it out ($5500/year) isn't a bad idea at all. You could even use that money to help your future kid with college expenses or whatever since the Roth is such a flexible savings vehicle.
I'm kinda in the same position and have been trying to figure out if I wanted to do some light day trading along with some investments and my wife wants an annuity for a guaranteed cash flow.
What is the cheapest way to buy/sell stocks? I'd manage it. Is there a limit to transactions a day with the cheap service?
In reply to carguy123 :
As a statistician that has reviewed many assessments of investing techniques over the years, I've concluded that the best risk / reward strategy is to simply:
Buy and hold ultra low-load index funds (aka - passive investing).
Something like 90% of day traders lose money and 98% don't do as well as the S&P 500.
Only a tiny minority of mutual fund managers are talented enough (as apposed to short term random luck) to consistently outperform the market by a large enough margin to cover their expenses and the additional taxes they're incurring.
Unfortunately, by the time fund managers have a long enough track record to allow us to distinguish talent from luck, they're retiring out or the world has changed so much that their approach has become obsolete.
For decades, Warren Buffett has said "unless you've got many, many millions of dollars in your portfolio, just buy and hold a S&P 500 index fund".
Annuities are a horrible investing instrument and Ken Fisher (President of Fisher Investments) is famous for saying "I'd rather die and go to hell than sell you an annuity" - Don't walk, run away from annuities; absolute garbage.
Please read "The Drunkard's Walk" if only for the section on fund managers. It was written by a leading Ph.D. Statistician that's professor of mathematics at Cal Tech and works at JPL.
This thread became more interesting. I switched -to- a financial advisor for some leftover retirement stuff, and was pretty happy. He would do a good job and check and move things about which made sense to me, and seemed to understand the market better than I did, but explained it and let me make every call.
He died of Covid two weeks ago.
Now I am left reevaluating this. I have a solid recommendation, but I am on the fence if I should just do it myself.
Thoughts?
If you think you can daytrade, set up a game and try it for a while: https://www.marketwatch.com/game. Set up another user who just buys the SP500 index. You won't win on a long enough timeline.
I did daytrade for a bit. I had an algorithm that I used. It was pretty good, but you had to be paying attention to it during all of trading hours. Far too much work, and too volitile for my liking. I ended up matching the SP500 in the long run (about 1 year), then the software was shut down. I think it could have proven lucrative, but it could have also tanked everything. At one point I was up 75%; shortly after, I missed the notification to sell (software wasn't integrated) and I was down 10% from my initial starting point, or down 51% from that peak.
And therein lies one of the problems: Because of the exponential nature of the stock market, your losses become so much more significant than your gains.
I couldn't stomach it. If I was single and young, maybe I'd give it a go. But... too risky.
tuna55 said:This thread became more interesting. I switched -to- a financial advisor for some leftover retirement stuff, and was pretty happy. He would do a good job and check and move things about which made sense to me, and seemed to understand the market better than I did, but explained it and let me make every call.
He died of Covid two weeks ago.
Now I am left reevaluating this. I have a solid recommendation, but I am on the fence if I should just do it myself.
Thoughts?
You're smart enough to do it yourself; unless you're looking for tax and estate advice, I don't know what benefit an advisor would provide you.
mtn said:tuna55 said:This thread became more interesting. I switched -to- a financial advisor for some leftover retirement stuff, and was pretty happy. He would do a good job and check and move things about which made sense to me, and seemed to understand the market better than I did, but explained it and let me make every call.
He died of Covid two weeks ago.
Now I am left reevaluating this. I have a solid recommendation, but I am on the fence if I should just do it myself.
Thoughts?
You're smart enough to do it yourself; unless you're looking for tax and estate advice, I don't know what benefit an advisor would provide you.
Someone who does it with regularity. I don't take full advantage. I'm busy. Also there may be a few tax questions which I'll need explained. PM for details, but TL;DR, there may be a strange windfall coming in a few years.
mtn said:If you think you can daytrade, set up a game and try it for a while: https://www.marketwatch.com/game. Set up another user who just buys the SP500 index. You won't win on a long enough timeline.
I did daytrade for a bit. I had an algorithm that I used. It was pretty good, but you had to be paying attention to it during all of trading hours. Far too much work, and too volitile for my liking. I ended up matching the SP500 in the long run (about 1 year), then the software was shut down. I think it could have proven lucrative, but it could have also tanked everything. At one point I was up 75%; shortly after, I missed the notification to sell (software wasn't integrated) and I was down 10% from my initial starting point, or down 51% from that peak.
And therein lies one of the problems: Because of the exponential nature of the stock market, your losses become so much more significant than your gains.
I couldn't stomach it. If I was single and young, maybe I'd give it a go. But... too risky.
Absolutely 100% do not want to daytrade. Way too busy.
Also, dude made me 26% YoY
Daytrade post was in response to Carguy123.
26% after fees? What years?
mtn said:Daytrade post was in response to Carguy123.
26% after fees? What years?
YoY from last year to today. After fees.
tuna55 said:mtn said:Daytrade post was in response to Carguy123.
26% after fees? What years?
YoY from last year to today. After fees.
You would have been better off in an SP500 index fund or Total Stock Market index fund. VTSAX and VFIAX both returned over 30%, after fees, since last year.
mtn said:And therein lies one of the problems: Because of the exponential nature of the stock market, your losses become so much more significant than your gains.
Exactly...
If you gain 50% and then lose 50% you end up down 25%...if you lose 50% and then gain 50% you end up down 25%.
The math is telling us to minimize loses rather than maximizing gains but people are lazy and don't want to wait for compounding interest do its thing and people weaponize investing trying to make it demonstrate how smart they are rather than just having it give them the best chance at a comfortable retirement.
Your best odds are to simply buy and hold ultra low-load index funds.
FWIW, I'm 57 and have absolutely zero bonds. I'm pretty sure most / all financial advisors would try to push me into 30% to 40% bond allocation.
I still owe 40K on my mortgage...why the berk would I have a dime in bonds when they yield less than my interest rate???
Seriously, somebody please explain to me why anybody would start buying bonds before they're completely debt free; waiting.
RX Reven' said:mtn said:And therein lies one of the problems: Because of the exponential nature of the stock market, your losses become so much more significant than your gains.
Exactly...
If you gain 50% and then lose 50% you end up down 25%...if you lose 50% and then gain 50% you end up down 25%.
The math is telling us to minimize loses rather than maximizing gains but people are lazy and don't want to wait for compounding interest do its thing and people weaponize investing trying to make it demonstrate how smart they are rather than just having it give them the best chance at a comfortable retirement.
To do the math here, to demonstrate:
Or, a less "random" example, lets just say that you keep getting 10% returns and 10% losses:
So... You really have to limit your losses, and hold onto your gains.
RX Reven' said:FYI, I'm 57 and have absolutely zero bonds. I'm pretty sure most / all financial advisors would try to push me into 30% to 40% bond allocation.
I still owe 40K on my mortgage...why the berk would I have a dime in bonds when they yield less than my interest rate???
Seriously, somebody please explain to me why anybody would start buying bonds before they're completely debt free; waiting.
I've never been able to figure out the bonds recommendations either. Even if you're retiring tomorrow, if you have enough of a nestegg to retire, it doesn't really pan out.
mtn said:I've never been able to figure out the bonds recommendations either. Even if you're retiring tomorrow, if you have enough of a nestegg to retire, it doesn't really pan out.
Yeah, DW is going to retire within a year and I am within two, and our person is still keeping us in pretty aggressive stuff. Definitely hasn't moved us to anything like bonds or other very conservative instruments.
RX Reven' said:Seriously, somebody please explain to me why anybody would start buying bonds before they're completely debt free; waiting.
While bonds have taken a hit this year, I wouldn't be too dismissive of all of them. For example, take VWESX.
https://finance.yahoo.com/quote/VWESX/performance?p=VWESX
If your mortgage out performs this over time, you might also need to refinance. On top of solid long term returns, of special significance look at years 2001, 2002, and 2008. Now compare that against VTSAX at -10.89, -20.95, and-36.99 for those years respectively. No the long term returns don't equal VTSAX, but they're far better than current mortgage/refi rates, in addition to being a stabilizing asset in times of economic turmoil.
While I'm not a proponent of high bond allocations either, even for the more 'aggressive' common investor they don't have to be return sucking wastes of portfolio either.
Driven5 said:RX Reven' said:Seriously, somebody please explain to me why anybody would start buying bonds before they're completely debt free; waiting.
While bonds have taken a hit this year, I wouldn't be too dismissive of all of them. For example, take VWESX.
https://finance.yahoo.com/quote/VWESX/performance?p=VWESX
If your mortgage out performs this over time, you might also need to refinance. On top of pretty solid returns, of special significance look at years 2001, 2002, and 2008. Now compare that against VTSAX at -10.89, -20.95, and-36.99 for those years respectively. No the long term returns don't equal VTSAX, but they're far better than current mortgage/refi rates, in addition to being a stabilizing asset in times of economic turmoil.
I wouldn't push major allocations of bonds, but even for the more 'aggressive' common investor, they don't have to be return sucking wastes of portfolio either.
Where the hell are you finding a mortgage that's less than 1.5%? And even if you cherry pick for the dip in 2008, it is still only a 3% to 3.5% return at best, before inflation.
In reply to mtn :
Are you just looking at the price over time, and not the total returns? You need to factor in (reinvested) dividend and capital gain distributions. Follow my link, and scroll down to the "Annual Total Return % History".
Driven5 said:In reply to mtn :
Are you just looking at the price over time, and not the total returns? You need to factor in dividend and capital gain distributions. Follow my link, and scroll down to the "Annual Total Return % History".
Ah, fair point. Still, not sure why you'd go with this vs VTSAX unless you're really near retirement.
In reply to Driven5 :
I owe 40K to the penny on a 30 year fixed loan at 3.625% and I pay down 2K in principle to the penny each month.
I'll be increasing my principle pay down amount so the loan is paid off next September when my eldest daughter heads off to college.
I just did the math, all up, I'm only going to pay $604.14 in interest for the remainder of the loan's life...even if I could do a zero point refinance at half my current interest rate (1.813%), I'd only save $302.07; not worth the paperwork hassle.
Anyway, I think the only way to have both a high probability of success and be efficient (make your money work hard for you rather than the other way around) is to over shoot on your retirement objectives.
If the math sez' you need 3 million in stocks, hang it up when you have 3.5 million in stocks as 3.5 million in stocks probably has about the same risk / reward profile as 2 million in stocks and 2 million in bonds.
But, 3.5 million in stocks lets you tell the world to berk off 500K earlier than 4 million split between stocks and bonds.
In reply to mtn :
Put it in the context of the statement I was directly replying to.
I'm not offering it as a general recommendation here. But for those planning to retire within the next few years, and/or are concerned about economic turmoil, I am simply demonstrating that the right bond funds can still be viable alternative to help mitigate some risk that also doesn't require giving up entirely on a reasonable rate of return.
In reply to RX Reven' :
I am not disagreeing with you... Merely answering the question you asked. Yes 9% is noticeably better than 7%, but 7% is considerably better than 3.625%.
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