The "I have XX money to invest, where should I put it?" Thread

[taikogod]

looked in to those a bit.. it seems like most banks are offering ~1.5% maximum right now. isnt inflation higher than that?

will keep looking, thanks.

would putting it in poker and staking it be a huge risk? i have a some experience staking. obv a lot more work tho.. guess this is a stupid question since i should judge myself

[tyler_cracker]

yeah, that rate of return isn't very good. to get more, you need to either accept more risk or have a longer timeline.

i would not classify any kind of poker staking as a low risk investment.

[cro0sh]

Hi there,

I'm 22 and live in Canada. I dont have any investing experience. I am a successful poker player, +$50k winner since 2010ish. I'm a second year business student but don't have any outstanding loans. I have a full time job that pays $4k a month and I'm doing that instead of school at the moment.

Expenses: food, gas, car insurance

My risk tolerance is low/medium. I have $10k in a savings account for investing (has to be better than collecting $120 a year right?). This is 60% of my total cash (poker br/chequing account). Timeframe for investment? This is tough but I guess it depends on how much of the $10k I invest.

Thanks for the advice

[Sir Pwn A Donk]

I'm 22 and right now have about 25k to invest. I have no debt or student loans and can live off of what I have in my checking account and not touching the 25k. There's only about 5k worth of that money that I'll need to touch within the next year. I'd prefer low risk investments but am open for anything. Right now it's just sitting in a safe since I just got it and if I deposit over 10k in the bank it'll be reported (I hit a score in Vegas and won 25k in free play...won just over 25k with only 5k of that being taxed and me being given W2 forms). What would be some options for me to look at? In the near future I'll probably dump it in portions into a savings account until I figure out what my best options are.

[oofRome]

Unless you're laundering money, you should not care whether or not the transaction is "reported".
Plus you already paid taxes on it. I don't understand why you're concerned about that.

[JustCarn]

Here are my 401k options:

-AF Europacific Growth R5 - RERFX
-Dodge & Cox Income - DODIX
-TR Price Growth Stock Fund - PRGFX
-Lord Abbett Mid Cap Stock I - LMCYX
-TR Price Mid-Cap Growth Fund - RPMGX
-Oppenheimer Developing Markets - ODMAX
-TR Price Retirement Fund 2005, 2010, 2015, 2020, 2025, 2030, 2035, 2040, 2045, 2050, 2055
-TR Price Retirement Income Fund - TRRIX
-TR Price Small-Cap Stock Fund - OTCFX
-TRP Equity Index Trust (S&P 500 Index)
-TR Price Stable Value Fund Sch A
-TR Price Value Fund - TRVLX
-Vanguard Inflation Protected Secs - VAIPX
-Vanguard Total Stock Market Idx Instl (Wilshire 5000 tracking fund) -VITSX
-Vanguard TTL BND Mrk Index Inst (Lehman Bros Bond Index tracker) - VBTIX
-Vanguard Total Intl Stk Idx Inst (International Composite Index) - VTSNX
-Vanguard Wellington Fund -VWENX

Is it a bad idea to just put 25/25/25/25 in the S&P Index / Bond Index / Wilshire 5000 Index and the International Index? Better ideas?

Also have some additional funds that are in a saving account that I could invest now:

Country you live in: US
Income: not too important
Amount to invest: 10k-20k
Risk Tolerance: Medium
Debt: None

Timeframe for investment: 1-3 years

[oofRome]

how much longer until you retire?

[JustCarn]

Originally Posted by oofRome

how much longer until you retire?

me? 30+ years

[tyler_cracker]

if your retirement is in 30+ years, why/how do you have an investment timeline for your 401k that is 1-3 years?

[tyler_cracker]

the first thing i would do when evaluating 401k options is look at the expense ratios on those funds. conjecture: all of them will be rape except the vanguard index funds.

the wellington is an "all-in-one" fund. you wouldn't own it in addition to total us and total international indexes. if you prefer the all-in-one approach (a totally valid strategy, especially for a newer investor), i would recommend the Target Retirement funds over the Wellington since they auto-reallocate for you over time.

an equal 3-way split between total us, total intl, and total bond is also a valid strategy, though you will need to learn about rebalancing and account for the fact that as you get older, you will want more of your assets in bonds and fewer in stocks.

[oofRome]

I think he was saying 1-3 years on the 10-20k^^

I agree with just about everything Tyler said. The target funds are an easy choice, Vanguard is going the be the least expensive. However, the expense ratios on those managed funds are pretty low, and some of them are actually pretty good.

With 30+ years until retirement, I really don't think you need bonds making up 25-33% of your retirement portfolio right now though. You can do with a lot less, but I'm assuming you didn't have a really good reason why you went 1/4 1/4 1/4 1/4 on your allocation.

[JustCarn]

Originally Posted by oofRome

I think he was saying 1-3 years on the 10-20k^^

I agree with just about everything Tyler said. The target funds are an easy choice, Vanguard is going the be the least expensive. However, the expense ratios on those managed funds are pretty low, and some of them are actually pretty good.

With 30+ years until retirement, I really don't think you need bonds making up 25-33% of your retirement portfolio right now though. You can do with a lot less, but I'm assuming you didn't have a really good reason why you went 1/4 1/4 1/4 1/4 on your allocation.

yes, sorry, 1-3 years on the $10-20k. And you're right, I had no good reason why I went 25% across, other than someone told me I should own some bonds and that the indexed funds have lower expenses and that might make a difference over the long run.

[JustCarn]

Originally Posted by tyler_cracker

the first thing i would do when evaluating 401k options is look at the expense ratios on those funds. conjecture: all of them will be rape except the vanguard index funds.

the wellington is an "all-in-one" fund. you wouldn't own it in addition to total us and total international indexes. if you prefer the all-in-one approach (a totally valid strategy, especially for a newer investor), i would recommend the Target Retirement funds over the Wellington since they auto-reallocate for you over time.

an equal 3-way split between total us, total intl, and total bond is also a valid strategy, though you will need to learn about rebalancing and account for the fact that as you get older, you will want more of your assets in bonds and fewer in stocks.

Thanks very much. Pointless to own the S&P index in addition to the wilshire 5000? At what point do you consider the fees on the other funds to actually "be rape"? Have noticed that the index funds are around .10% or lower, while the managed funds can be several multiples higher.

[tyler_cracker]

correct, don't own two things that index the same thing (more or less). i prefer total indexes to ones that cut out the smaller caps.

several multiples higher counts as rape for me. i can't give a hard number because some indexes simply cost more for a variety of reasons (e.g. compare total us stock to a REIT index).

[oofRome]

I consider getting into American Funds EuroPac @ NAV w/ ER of %.55 to be a steal for OP, but that's okay.