Investing General Discussion
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Wingz
Being Poor Sucks.
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Big Phoenix
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Sanrith Descartes
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UGMA & UTMA accounts | Tips for custodial accounts | Fidelity
Custodial accounts help adults save and invest money on behalf of a child until the assets must be transferred to them. Learn about UGMA/UTMA accounts here.
www.fidelity.com
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Sanrith Descartes
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I reiterate I think BABA is a buy at this price. China is not going to kill their golden goose. I can see it being choppy for a bit but this should be an easy 15-20% gain within 30-60 days.
UGMA & UTMA accounts | Tips for custodial accounts | Fidelity
Custodial accounts help adults save and invest money on behalf of a child until the assets must be transferred to them. Learn about UGMA/UTMA accounts here.www.fidelity.com
Make sure you understand the kiddie tax rules(This has changed back and forth in the last few years) and be proactive by harvesting your childs gains up to the tax free limit each year.
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Khane
Got something right about marriage
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View attachment 361653
UGMA & UTMA accounts | Tips for custodial accounts | Fidelity
Custodial accounts help adults save and invest money on behalf of a child until the assets must be transferred to them. Learn about UGMA/UTMA accounts here.www.fidelity.com
This is what I am doing for both of my nieces.
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Sanrith Descartes
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Sanrith Descartes
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Haus
I am Big Balls!
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OK. I have a money management hypothetical for the group. This seems to be the best thread to post it in as one side of the hypothetical involves investment strategy... (This spawned off a conversation I have had ongoing with a co-worker involving personal money management)
Say you were in a position where a windfall came your way. (Maybe you hit big in a poker tournament, got lucky on picking 5/6 numbers, got a really large commission or bonus check from your work, your dog dug up a huge crate of Nazi Gold Ingots... whatever...) And you have decisions to make....
1) Pay off your house (mortgage) and your car. (Achieve the Dave Ramsey dream state of truly zero debt whatsoever)
2) Pay off your car, your remaining student loan balance, take a really nice vacation, buy some guns and ammo, and invest the rest in a split of stocks, crypto, and yield farming stablecoins.
3) Just buy a few toys and invest in the split of stocks/crypto/etc.
4) Pay off your car, and put a very nice down payment on some land outside town to build your post apocalyptic compound on...
All three include wiping the small amount of non-secured credit card debt you have, your mortgage and car payment interest rates are both below 3.5%. Doing any of the three wouldn't leave money to do the others.... (you get the idea.)
Or is there a better option?
Say you were in a position where a windfall came your way. (Maybe you hit big in a poker tournament, got lucky on picking 5/6 numbers, got a really large commission or bonus check from your work, your dog dug up a huge crate of Nazi Gold Ingots... whatever...) And you have decisions to make....
1) Pay off your house (mortgage) and your car. (Achieve the Dave Ramsey dream state of truly zero debt whatsoever)
2) Pay off your car, your remaining student loan balance, take a really nice vacation, buy some guns and ammo, and invest the rest in a split of stocks, crypto, and yield farming stablecoins.
3) Just buy a few toys and invest in the split of stocks/crypto/etc.
4) Pay off your car, and put a very nice down payment on some land outside town to build your post apocalyptic compound on...
All three include wiping the small amount of non-secured credit card debt you have, your mortgage and car payment interest rates are both below 3.5%. Doing any of the three wouldn't leave money to do the others.... (you get the idea.)
Or is there a better option?
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Tmac
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Big Phoenix
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Id say 2 or 3.
Going that route you always have the option of selling whatever you invested in and doing 1.
Going that route you always have the option of selling whatever you invested in and doing 1.
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Sanrith Descartes
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The answer needs to be couched within the person winning it. On one hand, a disciplined investor can profit from keeping low interest debt and investing the windfall in a vehicle that delivers a higher return than the interest on the debt. That's math. The challenge is the non-math part... human frailty. If the investor doesn't invest wisely, gets scared and sells on a correction, spends it all on a coke and where's on a Vegas weekend etc.. then paying off the debt is the right play.
The math is easy to calculate. The human factor not so much. This gets brought up as a recurring question specifically in regard to mortgage debt. A 2.5% mortgage and cash in the SPY is the better play, but owning your house outright without fear of ever being homeless is hard to quantify.
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Furry
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I could pay my house off tomorrow if I wanted. It's extremely tempting to me. I know the smart play it to take the value stored in it out in a loan and put into investments... but reducing what I owe the world every month between house taxes insurance and bills to under 700$? That is also extremely tempting. I could get fired and end up flipping burgers and basically be living easy. It's hard for me to commit either way with one being smart, but the other feeling so good.
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Sanrith Descartes
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It's a tough choice. Kind of like choosing between Gal Gadot and Alexandra Daddario. Both choices definitely have upside.
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Furry
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Which is why I'm doing the sensible thing and trying to figure out a way to have both.
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Gravel
Mr. Poopybutthole
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The "math" choice pretty much favors keeping the low interest mortgage and using the money elsewhere to make more money.
But the "mental health" choice has a super strong argument to not owing anything.
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Sanrith Descartes
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I am actually in the same boat with my car. 15 payments left of $544 (@ 2.9% apr) or just finish paying it off and be payment free putting that 544 each month into my brokerage account to replace it. Then I look at what FTEC did the last 30 days and I'm like... nope keep making the payments.
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Haus
I am Big Balls!
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This is exactly where my conundrum in answering this one is.
I'm good at math, good enough to know even if I invested in a moderately conservative portfolio I could beat 4% a year. Meaning it would be more profitable to invest and keep paying the mortgage as slow as one could. Same with the car payment as long as it's also at a lower interest rate than one could make in investment. Right now just dropping money into a stable coin (DAI) and dropping that on AAVE is yielding over 9%.
The "human side" of the equation for me though is that I was raised by post depression/WWII era Americans (my grandparents). To say my grandfather didn't trust banks would be like saying bears occasionally shit in the woods, and the pope is sometimes catholic. It galled him to no end to have had to take a mortgage out to buy a house when he moved the family to the city in the 50's (and it was fully paid off before I was born in the late 60's). He NEVER had a car loan (cars are something you save up and buy in cash...) We had ONE single credit card in the family while I was growing up. It was a Sears card, and it was used essentially for two things. To buy my school clothes once a year (since it was easy to use over the phone ordering from the Sears catalog) , and if a major appliance needed replacing. For a decade after he died I was STILL finding money stashed away and hidden in the house I was raised in. The only thing he thought the bank was good for was putting money into CDs which is how he gave me "College or get yourself started" money when I graduated high school.
That part of me would scream to eliminate any and all debt.
In this scenario for me, paying off car would just mean that amount would then go monthly into the portfolio. Paying off my mortgage wouldn't eliminate that all together, it would still mean round half what my current mortgage payment would be would be for "escrow" (Insurance and Taxes) and ergo I'd want to save away anyways (probably dropping into the aforementioned DAI stablecoin yielding account).
Khane
Got something right about marriage
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As someone who has been debt free since 3 years ago I can say there is a freedom that comes from not being beholden to monthly payments. That position of "fuck you" if you will. It's hard to overstate how much stress it alleviates.
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