Investment BS Thread - Stocks/Futures/Mutual Funds/Bonds/Commodities/Options/ETFs/401ks/Etc

I agree with this 100%, in my later years im more inclined to Bonds and tax free municipal bonds,CDs, stock that will pay exceptional high dividends, rather than take the risk in the market and not have the money when I need it not when the market dictates when and if I can sell without losing my principle

 

I think if you can build enough up, a 4% dividend growth portfolio should get you through retirement without ever touching the principal. I am doing that now at the sacrifice of some growth probably, but the monthly income is there to reinvest now and spend when I need it.

 

Yes you are correct.

 

Big Oil EXXON,BP are relatively cheap to buy since oil is down to around $50 per barrel but who knows with the big push towards alternative energy they might not ever get back to selling at $100+ per barrel where u could by cheap and cash in big. im really interested in Natural gas companies that might be the new area of getting big payouts. right now the USA is the biggest Natural gas and Oil producer in the World a fact that not many Americans even know.

 

ENB is doing great right now with a pretty big dividend.

 

I like the idea a lot, since im about 15 years toward retirement(if that will ever really exist if I can get there) my strategy is to live off interest earned on what ever vehicle pays the best interest/dividends and leave the principle alone like u say. actually ive been out of work since Oct. 2018 to where the point I have to buy my own healthcare coverage thru COBRA and im using a money market account interest to pay the monthly cost and still have a few dollars, what a relief to know I can do that, reality is I worked my butt off saved and lived frugally in my younger years and its paying off later in life.

 

I like doing it this way also because when you die, you can leave a trust behind (to a family member, charity, etc) that will pay monthly into perpetuity. I feel better about doing something like that, than just giving someone a whole lot of money. It will outlive you in a big way if you set it up right.

 

sounds good, if your retired and the dividends are coming from a Roth IRA then there are no tax to pay also you receive the distributions tax free a double plus. this is what im looking into right know I have an outstanding 401k from a previous employer and some cash tied to a TD Ameritrade account that's available id like to rollover the 401k to a Roth IRA(pay the tax now) and then later add the cash to it, just need to find a good reliable vehicle I would be very happy at 4% interest on it at this time, unless those rates rise at some time but who really knows.

 

Well PCG is up almost 80% today, missed out on that one..

 

This is good advice. I live paycheck to paycheck, probably worse actually. That is only because most income goes straight into investments. It works out fine, never missed a bill or didn’t do something that I wanted to do, but that’s where every dollar goes as soon as it can. Otherwise, if you pay yourself last, there probably won’t be much left to do that.

I’d recommend a few things I have found in recent years works well.

Use a good rewards credit card and buy everything with it. Then go to your mobile banking app and pay it daily or weekly or however. That card has paid me a lot of money by doing that, never paid any interest either, and pretty minimal effort.

Also, get a Costco card and buy everything there. Make your own lunches and dinners during the week.

It may seem crazy or like too much effort, but when you get a monthly dividend check that’s more than your salary ever was, it will be worth it. That will only grow as you get older as well. I’m not there yet but heading that way soon.

 

Guys thank you for all of the advice I really appreciate it. I won't wait any longer. I graduated debt free because of scholarships and have money saved up already, and I will enroll in my employers plan this weekend.

The company does the match regardless of whether I pick the traditional 401k or roth 401k correct? I know they offer both options. Since I'm interested in the roth option, does their contribution also go in as after tax dollars?

 

I think if they match in a plan that taxes on the way in (can’t remember which is which), you would not be taxed when you withdraw. Someone can correct me if that’s wrong.

 

Did some google searching- I think their contributions go into a separate account that is taxed like a traditional 401k

 

I didn’t know that, I’ll have to do some reading. That seems complicated.

Edit: Just found it in investopedia, looks like it is held separately. Never heard of that before.

 

Roth would be your better choice

 

Almost back to break-even! *lulz*

 

Lots of replies here since I haven't been in this thread in a while lol so here goes my 2 cents

market dips sometimes have nothing to do with the economy.. this is almost always what happens with the Fed increases interest rates. They increase the rates because they know (or think) the economy can handle it. They're doing it slowly enough that it might not break anything and thus won't cause a particular asset class to break (like it did in 2008 with the housing market which was soon followed by the markets dropping). The fed is just trying to reduce the hot air in the PE bubble

This

You should just stop contributing to it if you really don't want any money in your 401k. I would def take a company match tho

not sure about rolling into a "personal" 401k, but if you transition jobs, you can transfer your 401k money to the new account that your new employer provides, tax free.

Well they always say "time IN the market is better than TIMING the market", since he hasn't actually gotten IN the market yet, I would recommend he build up some cash reserves, maybe put it into a 401k package that uses short term treasury bills as the main vehicle, and ride on the 3-4% interest until the market is more favorable for buyers.

This. Take advantage of the company match even if you choose to invest into a fund that is extremely low risk - you're literally leaving money on the table otherwise. Conversely, if you put that money into a high risk index, you would have to lose 50% before that actually affects the money that you personally contributed

Again time IN the market is different from TIMING the market

Yep

It may take a geopolitical conflict to increase oil prices... which we are overdue for (hint hint Venezuela)

I think I mentioned something about this earlier

I would recommend putting 50% into Roth and 50% into pretax. Yes your company will match your amounts accordingly to the pretax/roth account you put it in. I have asked my employer this and yes, if I put 2% into Roth, they put 2% into that Roth, and then if I put 3% into pretax, they'll put 3% into pretax. Total 5% but taxed at different times.

The reason why I say 50/50 is because you have no idea what tax policy regarding retirement withdrawals will be 30-40 years down the line vs. what the tax policy is now - it would reduce your tax risk both ways if you do half and half.