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Hypothetical situation: what to do with extra cash?

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07-31-2014 , 12:40 PM

#26

Didace

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Join Date: Nov 2009 Posts: 20,441

Quote:

Originally Posted by tylertwo

it may very well go up in the future, but can it go up forever?

I'm sure they were asking that in 1987, too. Then it crashed (S&P - 335 to 225). Where is it today?

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07-31-2014 , 02:47 PM

#27

tylertwo

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Join Date: May 2012 Posts: 8,111

Quote:

Originally Posted by Didace

I'm sure they were asking that in 1987, too. Then it crashed (S&P - 335 to 225). Where is it today?

I don't think your facts prove what you think they do, lol. If they had bought when the market was at 335 they would have lost about a third of their net worth. Today, with unprecedented Federal help (0% interest, QE, etc.) the market is now at or near its historical high. I wouldn't say that this was the time to put all my money into the market. You do know that most hedge fund mangers are heavily in cash right now?

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07-31-2014 , 03:17 PM

#28

Didace

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Join Date: Nov 2009 Posts: 20,441

Are you suggesting that you can time the market?

Yes, people would have lost a third, but it all came back and relatively quickly if you look at it long term. If you can't ride out bumps you shouldn't be in the market at all.

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07-31-2014 , 03:25 PM

#29

El Diablo

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Join Date: Sep 2002 Posts: 68,145

af,

What a couple guys above said. Just keep it in a sock drawer and use it for paying for more regular stuff in cash than you usually do.

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07-31-2014 , 06:05 PM

#30

tylertwo

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Join Date: May 2012 Posts: 8,111

Quote:

Originally Posted by Didace

No, I'm saying exactly the opposite, but you still wouldn't want to begin buying in with a block of available cash at an obvious high point. You are talking about more of an income averaging strategy and holding on for the long term, a much wiser plan. Again, it's only five thousand dollars, but if you are talking about a thirty year buy and hold, I'm not sure the market would be the correct play right now.

(And in 1987 I was coming out of the savings and loan debacle making some fairly serious money in both real estate and (minimally) the market.

)

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07-31-2014 , 06:15 PM

#31

thabighurt35

**** you Monday

Join Date: Feb 2009 Posts: 11,552

depositing 5k cash is not going to alert the IRS, although most banks will make a note internally at that amount. Just make 2 separate $2500 deposits a month apart and dont sweat it.

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07-31-2014 , 07:18 PM

#32

euler217

adept

Join Date: Jun 2007 Posts: 798

I was excited to write some comments about putting it into a Roth IRA and saving $500 for emergencies, then realized this is probably about avoiding taxes. The situation doesn't make sense to me though - you are reporting winnings and losses that net to 5 figures for the year but after running hot for $5k you want to make it disappear? The question of what is the best way to invest $5k is more interesting to me but for now I'm curious how this really happened and how you want it to have happened.

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07-31-2014 , 07:28 PM

#33

AngerPush

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Join Date: Oct 2009 Posts: 32,324

you do know that investing it and just paying the taxes will end up in the long-run with more value then keeping in sock drawer.

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07-31-2014 , 07:32 PM

#34

El Diablo

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Anger,

That doesn't make any sense at all. He's not keeping it in a sock drawer for savings, he's going to spend this money.

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07-31-2014 , 10:04 PM

#35

fidstar-poker

I'm gonna need a hacksaw

Join Date: Jun 2012 Posts: 34,059

I'm so glad you don't post in BBV anymore.

If should be noted that if your threads are too bad for BBV you have serious issues.

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08-01-2014 , 12:24 AM

#36

etothemc2

old hand

Join Date: Dec 2007 Posts: 1,317

Wow, you have an extra $5000. And in cash too!

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08-01-2014 , 12:30 AM

#37

Halation

centurion

Join Date: Mar 2006 Posts: 101

Sock drawer for sure. Actually when my parents place got robbed they pulled out and emptied the top drawers only, so maybe the bottom drawer or some place more clever than that. Not under the mattress, they flipped those over. And if you're worried about being robbed or something like that get a safety deposit box. And yeah, spend it. Invest whatever else you have coming in, spend away the windfall in cash.

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08-01-2014 , 12:43 AM

#38

Hardball47

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Quote:

Originally Posted by afwoods

Already rubbed it on my tittays.

Try other titties.

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08-01-2014 , 03:45 AM

#39

wet work

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Join Date: Feb 2006 Posts: 9,729

ya, you should totally worry about the irs lol...they're gonna be on you in no time... in fact they'll probably have extra guys working overtime.

--edit. in case u take that seriously. absolutely noone cares about your 5gs. spend away freely. if you're determined to be paranoid go buy 3k+in money orders at the post office..they'll make you fill out a form...which you'll prob never hear about again.

Last edited by wet work; 08-01-2014 at 03:59 AM.

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08-01-2014 , 05:43 AM

#40

Howard Beale

Formerly red

Join Date: Sep 2005 Posts: 22,190

Buy one of the cheaper Panerais:

They do nothing but go up in value. I was offered 6K for the one I bought for 2.7K 10 or so years ago. Plus they look great.

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08-01-2014 , 06:01 AM

#41

wet work

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Join Date: Feb 2006 Posts: 9,729

well, none of those in that pic lol. (still prob not happening for 5 anyway)

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08-01-2014 , 12:15 PM

#42

Howard Beale

Formerly red

Join Date: Sep 2005 Posts: 22,190

You might be right. Last time I looked at them 5K was at the very low end. I love mine and I'm really glad I splurged.

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08-01-2014 , 12:49 PM

#43

AngerPush

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Join Date: Oct 2009 Posts: 32,324

Quote:

Originally Posted by El Diablo

Anger,

That doesn't make any sense at all. He's not keeping it in a sock drawer for savings, he's going to spend this money.

Oh. Seems many ppl were suggesting sock drawer.

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08-01-2014 , 12:54 PM

#44

EvilSteve

Midlife Crisis

Join Date: Mar 2006 Posts: 13,195

I was going to say for $5000 you can get a really nice watch. But I guess I was going too far with the "really" and this is the low end of nice watches.

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08-01-2014 , 01:15 PM

#45

ty71087

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Join Date: Jul 2009 Posts: 9,308

Go out to dinner?

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08-01-2014 , 02:17 PM

#46

Hardball47

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Join Date: Feb 2008 Posts: 13,308

The IRS won't bother you, unless it's worth their time and resource investment investigating and prosecuting you. The state's trying to generate a revenue. It wouldn't make much sense if the chase is costlier than the catch.

They're a business, dude. Nobody is going to give a **** about your $5k.

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08-01-2014 , 03:24 PM

#47

El Diablo

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Join Date: Sep 2002 Posts: 68,145

Anger,

Yes, I and others are suggesting sock drawer. But do you think that he doesn't spend any money at all?

Assuming he had to pay taxes if he deposited it, you said he's going to make more doing than and investing rather than just keeping all of it as cash.

That is completely wrong and doesn't make any sense at all unless he never spends any money on anything in his life.