None of those apply.
What would you do if you came into a good amount of money.
- Thread starter Oerdin
- Start date
C-40
NEW AGE POSTING
Bank it!. Investing money is for SUCKER ducks. I get my money from the streets, I make a $dollar off a every 45¢ I make. I've been off a welfare since.....White folks has been doing this they came up with supplying this.
USUC
Trollzilla
I’ll bite.
How do you make a dollar off of every forty-five cents you make “off the streets”?
You charge forty-five cents for a blow job and steal fifty-five cents from the John?
The Question
Eternal
Since we know you never come up with a fucking thing on your own, just repeat things you've read or heard other people say...
How many times have people hit you with that speech?
jack
The Legendary Troll Kingdom
Almost time to buy the dip, especially SPY.
Keep an eye on the market for the next few days...the Dow is already down 8% and the S&P almost the same.
The worst is yet to come, supposedly. GDP figures may indicate we're officially in a recession.
If for some reason the S&P craters to 3500 some folks say it will still pop 5k before years end. But June should be a bit messy if you're in already.
Asking Volpone: would you cost average here?
Keep an eye on the market for the next few days...the Dow is already down 8% and the S&P almost the same.
The worst is yet to come, supposedly. GDP figures may indicate we're officially in a recession.
If for some reason the S&P craters to 3500 some folks say it will still pop 5k before years end. But June should be a bit messy if you're in already.
Asking Volpone: would you cost average here?
Volpone
Zombie Hunter
You *always* do dollar-cost-averaging. That's the point of it. Because you invest the same amount every month (or week or whatever interval) you're automatically buying more shares when they're cheap and less shares when they're expensive. The only way it can fail is if a company goes under and the shares become worthless. In the early 2000s, if you'd have asked me, I'd have said Sears or Circuit City or something like that would never go under, so there's some risk to buying individual stocks, but if you're buying indexed mutual funds, unless the Dow or the S&P 500 (or whatever your fund mix is tied to) goes to 0, or you are forced to stop investing/or sell when stocks are down there's...I can't think of a risk to dollar-cost-averaging.
DISCLAIMER: I am not currently doing it because I need money to buy a house so a lot of my capital is just sitting on the sidelines right now. And I missed out big in 2008-2011 or so because I was working on some things where I needed capital and couldn't invest. But if I'd been doing dollar cost averaging in that period, I'd have made a lot of money.
DISCLAIMER: I am not currently doing it because I need money to buy a house so a lot of my capital is just sitting on the sidelines right now. And I missed out big in 2008-2011 or so because I was working on some things where I needed capital and couldn't invest. But if I'd been doing dollar cost averaging in that period, I'd have made a lot of money.
Volpone
Zombie Hunter
Oh, a few more points, after watching the 2 videos: The Ameritrade guy makes a good point about fees and commissions potentially cutting into profit. I don't like to pay commissions or fees. There are very few (if any) fees for my Vanguard fund and my General Mills doesn't charge me any fees or commissions. On the other hand, when he goes off to talk about lump sum and rebalancing your portfolio, he conveniently leaves off that there are fees and commissions involved in that. And you've got someone you're paying to decide what stocks are overvalued and undervalued. And if they actually knew what stocks were overvalued and undervalued, they wouldn't be working for you, they'd be rich and off golfing or yachting or whatever.
The other video leaves out the long-term effect of dollar-cost-averaging. He nicely explains that over a year's time you may make more or less on dollar-cost-averaging, but over...20 years time? Look at a chart of the stock market over 20 years. Has it generally gone up, down, or stayed about the same? It's generally gone up. Way up. Yes, there are some dips. That's when you get your good deals on shares. But eventually it goes up. Or let's use Microsoft, since that was the example in the video: Just going with 5 years, because that's an easy option on my link, Microsoft was trading at $68.93 a share in 2017. Today it is at $272.52. And it is down from a $336.32 high of Dec 1, 2021.
The other video leaves out the long-term effect of dollar-cost-averaging. He nicely explains that over a year's time you may make more or less on dollar-cost-averaging, but over...20 years time? Look at a chart of the stock market over 20 years. Has it generally gone up, down, or stayed about the same? It's generally gone up. Way up. Yes, there are some dips. That's when you get your good deals on shares. But eventually it goes up. Or let's use Microsoft, since that was the example in the video: Just going with 5 years, because that's an easy option on my link, Microsoft was trading at $68.93 a share in 2017. Today it is at $272.52. And it is down from a $336.32 high of Dec 1, 2021.
C-40
NEW AGE POSTING
^Nevermind^, I thought you were Loktar. If you were Loktar, I would have responded with.....the same way you sell your foodstamps and trick men into thinking you were female for a blow job.
jack
The Legendary Troll Kingdom
That's what I was thinking too. I use Schwab...they've never done anything but pay me dividends. I currently have SPY (and am buying the dip a little higher) MONSTER and a couple of other odds and ends I get in and out of (like ben and jerrys and Keurig/Coke) they dip and peak pretty predictably and are VT companies.. Never a fee or commission if I don't day trade.
Think I'll start putting a hundred in every 2 weeks, or 50 a week. Can't decide what would be more cost effective. Better smaller amounts every week? Or double every two?
jack
The Legendary Troll Kingdom
OK I reopened my Schwab account and am going to try this the way you suggested. I'm still on the fence about weekly vs biweekly contributions.
Volpone
Zombie Hunter
I should mention that I am not a financial advisor and that I haven't been particularly religious about investing. As I said, there were times I've had to sit on the sidelines because of lack of income, expected lack of income, or a need to use funds for something else. But I've never tried to "time" the market and I haven't tried to pick individual stocks in decades.
That out of the way, one would think the more frequently you invested, the more you'd "smooth" the profile and the less likely you'd be to buy overvalued stocks. And the way things are looking with inflation and a GDP contraction last quarter, it may be a hard road to walk for the near future. Looking back at the pandemic, my Darden shares were sitting at $117 in February 2020. They were $43 two months later. But within a year they'd recovered, getting to a recent high of $144 or so, but as I typed this, I see they're down to $130.
One more thing: The only reason I'm doing real estate investing is for the cash flow. A $100,000 investment in stocks may be worth $150,000 five years later (or at least it will have a lot less work and headaches, IMO), but even $150,000 in stocks isn't going to gross you $12,000 a year like a rental can (that's a bit of a simplification because I should whack off taxes, maintenance, insurance, and management fees). The other reason real estate wins over stocks, IMO, is that you can use leverage to build wealth. With stocks, after the Great Depression, they limited the amount you can borrow to invest in stocks to something like half your portfolio. So you've got to have money to play. With real estate if you're smart and lucky you can build a literal "house of cards": You get money from a "hard money" lender to buy a rental, fix it up and get it rented. Once it's rented, you can get a regular bank mortgage to finance it. And you get some extra money because the house is nicer so it is worth more than you paid for it. Then you repeat the process for as many times as you're comfortable with. Your renters pay off your mortgages and you keep the houses until you're ready to sell them. There's no way to do that with stocks.
That out of the way, one would think the more frequently you invested, the more you'd "smooth" the profile and the less likely you'd be to buy overvalued stocks. And the way things are looking with inflation and a GDP contraction last quarter, it may be a hard road to walk for the near future. Looking back at the pandemic, my Darden shares were sitting at $117 in February 2020. They were $43 two months later. But within a year they'd recovered, getting to a recent high of $144 or so, but as I typed this, I see they're down to $130.
One more thing: The only reason I'm doing real estate investing is for the cash flow. A $100,000 investment in stocks may be worth $150,000 five years later (or at least it will have a lot less work and headaches, IMO), but even $150,000 in stocks isn't going to gross you $12,000 a year like a rental can (that's a bit of a simplification because I should whack off taxes, maintenance, insurance, and management fees). The other reason real estate wins over stocks, IMO, is that you can use leverage to build wealth. With stocks, after the Great Depression, they limited the amount you can borrow to invest in stocks to something like half your portfolio. So you've got to have money to play. With real estate if you're smart and lucky you can build a literal "house of cards": You get money from a "hard money" lender to buy a rental, fix it up and get it rented. Once it's rented, you can get a regular bank mortgage to finance it. And you get some extra money because the house is nicer so it is worth more than you paid for it. Then you repeat the process for as many times as you're comfortable with. Your renters pay off your mortgages and you keep the houses until you're ready to sell them. There's no way to do that with stocks.
$0. And you'd be arrested after returning to the scene of the crime.
Hopefully next time you'll remember those exploding dye packs aren't fried chicken or watermelon.
jack
The Legendary Troll Kingdom
The real estate market is extremely limited in my area and the minimum to get in anywhere is about 1 million. There are no fixer uppers, they've all been snapped up and are being fixed up.
I wasn't asking for your advice because I thought you were a financial advisor. I ask as someone I consider having real world smarts and I appreciate the benefit of your experience. I have steady income, consistent week to week, and have a small nest egg I can draw from to start along with a bi-weekly supplement from my business.
I get the real estate thing. I could probably go 10 miles north or south and be able to attempt something like that because the town I live in is a bubble, only one that won't burst unless the housing market destroys itself somehow. This area has a total grand list valued at around $6 billion. A LOT of new construction too, considering zoning and the limited land left. Money talks.
Volpone
Zombie Hunter
Yup. I lucked out in Portland and found a place during the 2009 bust that needed some love and wouldn't qualify for an FHA loan as it stood. But by the time I was ready to try again the market had turned and there was absolutely nothing to be had. In fact by that point my job had moved and traffic was terrible so I was thinking of selling my place, taking the profit, and buying a bigger place near work that needed some love, but it had gotten to the point where I couldn't even afford a vacant lot or a teardown anywhere near my job so I got out. Got almost 3x what I paid for my house 7 years earlier and moved to a town where I could get a house literally twice as big, closer to downtown, for half the price. Of course I was a chicken and screwed around long enough that now there aren't any nice houses to be bought so I need to keep a paycheck job at least part time for now.
Volpone
Zombie Hunter
Oh and a quick anecdote on stocks -vs- real estate. After the last dinner meeting of the real estate association I'm a member of, I decided that if pirates had conventions, the vibe would be a bit like the meeting--everyone's working their con. And there are certainly good people out there that you can learn things from, there are a fair number of people who are working their thing and if they can make some money off you, they don't have a problem with that.
I mention this because within the past few months one of the 800# gorillas of the town posted to the private Facebook group, showing how badly his stock investment had done and saying how he'd be sticking with real estate and I couldn't let it slide. I had to point out that a cherry-picked "snapshot" of the market does not reflect the market. I forget what window he was using but it was a pretty rigged one--like my "My stock was worth $117 a share on February 2020 and it was worth $43 a share on April 2020. This proves the stock market isn't a good investment." I pointed this out and said that was like saying "I bought a house for $300,000 in 2007 and it was only worth $150,000 in 2009. This proves real estate isn't a good investment." He came back with "I'll stick with my 12 brick ranches that I bought for $100,000 each in 2009 that are worth $300,000 each now."
At that point I decided it was time to walk away, because he didn't want to hear what I was saying and what I was saying was interfering with what he was selling. BUT... I did go back and look at the historical data and crunch the numbers and the same amount of money invested in the stock market in 2009 would've been worth 5x as much today, so stocks handily outperformed real estate in that time frame (and all these years and amounts are from memory, so don't quote me on them). And with stocks there's no 3am clogged toilets or stupid surly tenants that bicker over everything or bureaucrats to fine you for a tenant having a junked car in the yard or because you didn't show someone in a wheelchair a 2nd floor apartment.
I mention this because within the past few months one of the 800# gorillas of the town posted to the private Facebook group, showing how badly his stock investment had done and saying how he'd be sticking with real estate and I couldn't let it slide. I had to point out that a cherry-picked "snapshot" of the market does not reflect the market. I forget what window he was using but it was a pretty rigged one--like my "My stock was worth $117 a share on February 2020 and it was worth $43 a share on April 2020. This proves the stock market isn't a good investment." I pointed this out and said that was like saying "I bought a house for $300,000 in 2007 and it was only worth $150,000 in 2009. This proves real estate isn't a good investment." He came back with "I'll stick with my 12 brick ranches that I bought for $100,000 each in 2009 that are worth $300,000 each now."
At that point I decided it was time to walk away, because he didn't want to hear what I was saying and what I was saying was interfering with what he was selling. BUT... I did go back and look at the historical data and crunch the numbers and the same amount of money invested in the stock market in 2009 would've been worth 5x as much today, so stocks handily outperformed real estate in that time frame (and all these years and amounts are from memory, so don't quote me on them). And with stocks there's no 3am clogged toilets or stupid surly tenants that bicker over everything or bureaucrats to fine you for a tenant having a junked car in the yard or because you didn't show someone in a wheelchair a 2nd floor apartment.
Volpone
Zombie Hunter
Oh, and if I wasn't so tired of working for a living I would absolutely sell off my properties and get back into the stock market 100%. I seriously considered it anyway when I hit the bumps in the road over the past year, but I'm going to give it a little more time. It's kind of nice to work 2 days a week in an entry level job and still have more money than I can spend.
Rusty Shackleford
Member
Two chicks at the same time?