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

I say lower than that. But it might hit 2800s pretty soon. I say it will go down to 2300 this year

 

I don’t see that happening. Even at these new highs, it’s already pretty much flat for the last 18 months. I think it goes up quite a bit higher by next year, maybe 3,500. Anything could happen though so who knows.

 

It should get really messy once the presidential campaigns get into full swing. Remember 2015 leading up to the primary and then the general? Woah, that got a little crazy. In general, I bet it hinges a lot on what/if the feds do to regulate big tech companies. I think public perceptions will massively sway markets across the board if things become combative, and this will amplify more during the elections. Given all the data saying our economy is actually quite shaky (lots of folks in low wage jobs, the tax cuts that didnt result in a budget cut, weird stuff happening to federal interest rates, etc), I bet we see both the high of 3500 predicted by @Boyk1182 and the low of 2300 predicted by @toyodajeff in the next year. I think its going to be a roller coaster.

 

Yea it could go up to around 3500 next year after the election is over. But I'm thinking were going down because things are looking down globally and were headed into an election year.

 

Does anyone know much about deferred comp retirement?

I'm looking at switching careers and looking at some jobs with my state dept. They have what they call a deferred comp plan that is "similar to a 401K". I cannot find out much more information about it than that (which is frustrating).

My goals are to ultimately max out all my retirement contributions in the next 3 years. Ideally I want 100% of my money in Roth. Would I be able to utilize the deferred comp plan the state offers me and then get an investment pro to roll that over each year into a Roth and just plan on paying the tax bill?

I'm married so we'd be maxing out two individual Roth IRAs each year with the $6K per year limit and then his 401K is a Roth which we can max out at $19K but how can I get my $19K limit in a Roth form? Is it even possible?

 

pretty boring 0.16% up today

 

I was -0.01% lol

 

Lots of tech heavy and recent IPOs are getting slammed today. Must be why Nasdaq is down nearly 1.5% while SPX is up a little.

 

Sorry for the delayed response - at work. Differed comp plans mean you set aside part of your paycheck to be paid to you at a later date, like when you retire. While the funds are differed, you can invest them and build wealth. Once the differed term is up, you pay social security and medicare taxes on the total value, not the original value, but no income tax. Huge tax advantage over a 401k! The funds you differ are not part of your taxable income, so it can drop you tax brackets as well. The issue is in liquidity, you cant get the money out, for any reason, period. No amount of tax penalties will allow you to access these plan ahead of their date of different. Hopefully you are savvy enough with 401ks that you can compare and contrast on your own?

In short, these are shit if you have access to, and amassed, sufficient emergency funds. Since you and your husband (I noticed you used the pronoun "his" when referring to your spouse) both have IRAs, and he has a 401k, and you are maxing these out... I mean come on.... this is a no-brainier. Dump as much money as you can into this thing! See if you can drop a full tax bracket, etc etc.

 

One more thing, your employer can very easily forfeit you the funds you put into this account. THAT is the biggest downside of differed comp. Just one day, in desperation, they can take all your money and file for bankruptcy. Oops, sorry, good luck retiring now.

 

Thanks for the response.

So in essence the deferred plan is great because #1 no taxes now, and #2 no taxes later (outside of SS/Medicare)? Like none?
Do I typically need to wait until I am 59.5 to access these funds or will it likely be a specific maturity date?

Right now we are doing 15% of household income in retirement and are working to get rid of our mortgage, once that is done (which isn't that far away) we'll start maxing out contributions. I prefer Roth plans, but if deferred compensation has a greater tax benefit over Roth long term then that's great for me because I don't need to worry about shuffling funds around. The catch is it takes 10 years to earn vestment. So if I leave I assume my contributions can just be rolled into a traditional since I didn't pay taxes on my portion going in.

 

Since I'm working for a state government, I'm not too worried the money just won't be there one day. I mean it's possible... but if it happens a lot of us are screwed throughout the state because basically the whole economy has taken a dump. But that is always a fear when you don't have control over your funds.

 

Thats exactly right. No taxes now, in fact you lower your taxable income. Some taxes later - everything except income tax. The lack of income tax is the real benefit. The deferment period is set by you and your employer. Some folks like 55yro, some 65yro, etc. This may depend on the exact terms of your plan. I would optimize your gains under this plan. If you have IRAs and 401ks, you will have plenty of cash starting at 59yro. You may want to consider extending the deferment period, if possible, to maintain your investments. However, some plans aren't this flexible. This is getting into the nuances of your exact options, which I'm sure are capable of reading. I'm not sure what will happen to this plan if you opt in and then leave. The main disadvantage, and maybe this will be less strict in your case, is there is no liquidity. So in theory you shouldn't be able to roll it into anything - you just wait until the deferment period is up. My honest opinion is to max our the roth first, then focus on the 401k, if you have a 401k or your spouse does, then work on contributing to one of these. In spite of the tax advantages, life throws you curves balls, and maintaining a degree of flexibility is nice.

Hopefully that helps.

 

That does help and it gives me questions to ask when the time comes to start setting up any contributions. I appreciate your comments. I'm very young so of course I want to maintain as much flexibility as possible. I have no clue what my retirement life will or won't look like at this point, I just want options so as I get older I can really just do whatever and I've put away enough at a younger age to easily be able to adjust to new plans.

 

These last 2 days have been rough for my portfolio, yesterday it was ABBV (-16%) and today it is GIS (-9%). I guess I can't complain considering how much I am up this year, but this is not fun to watch!

 

UWT up 10% this morning, I'm finally in the green again.

 

I can’t believe you guys check your stuff daily. I’d die of a stroke after a week.

 

The worst part is I don't sell for any reason (up or down), I just can't help myself but to watch it though.

 

I mean technically thats the way to look at it. You only lose money when you sell.

And the only people who get hurt on a roller coaster are people who jump off.

 

Wow, this is gold.