The Personal Finance / Investing Thread

[Frenetic]

I maxed out my 401k(457) and Roth IRA!

Hey everyone, I've done a lot of research and have some updates for you all.

Like 1CC'ing a shmup there are strats so here are some that I have found so far.

Get a personal budget going in Google Docs it is free. Make a copy of the sheet that suits you and start entering your stats. Track your spending and this will help you get control (just like keeping track of your scores in shmup).
https://www.reddit.com/r/personalfinance/wiki/tools

1. If you are in debt decide what is good debt and bad debt and pay the bad debt down.
https://www.reddit.com/r/personalfinance/wiki/debt

2. Once you get yourself out of debt, think about investing in a Roth IRA/maxing out your 401k (if you are in debt and have a matching 401k then invest up to the matching because it is free money, 457 or any other form of deferred comp is great)

The Money Mustache forums are good for personal lifestyle changes. Take what you will about the early retirement goal but but the blog articles have great advice in health, wealth, and skills https://www.mrmoneymustache.com/

Bogleheads book and forum are great for asking for investment help (feel free to post your personal finance profile according to forum rules).
The Bogleheads Guide to Investing is a good guide.
http://doc.xueqiu.com/14cf53ebdeb1cd3fd7a1bfa2.pdf
https://www.bogleheads.org

Hope this helps,
the F-man

[CIT]

Anyone have solid tips, etc.?

1. Never go into debt. (Only exception: you're buying a home.)

2. Learn how to calculate net present value (it's super easy with Excel), so you can do your own evaluations.

[GaijinPunch]

- Max out your 401k every year, without question. If you can't afford it, cut something out of your life. If your company offers a match, and you don't max out your contributions, you are pissing away money.

- Similarly with a Roth IRA (DISCLAIMER: I dropped the ball on mine big time and am punching myself in the balls)

- If you are gonna buy/sell stocks regularly, at least only do it with a percentage of your overall savings. Plenty of people can do it for you better in the long run, by way of mutual funds.

[Bananamatic]

should've invested in saidaioujou pcbs while they were still 2k

[MintyTheCat]

1. Pick your options carefully.
2. Resist the temptation to go 'all in' on one asset.
3. Play 'both sides'.
4. Remember that fees that the trading house charge can soon rack up substantially so aim to buy and sell as little as possible.
5. Keep tabs on all your investments - keep all your accounts, certificates, even gold in places you know where they are.
6. Do not become obsessed with constantly checking all your assets - that leads to madness.
7. Only invest what you can afford to lose: I know, you hear it all the time, but the number of people who say to me "should I get a loan out for $50K, invest then repay back the loan after 'winning'?" or something similar is a bit worrying.
8. Inform yourself about the various taxation schemes: working tax, capital gains tax, etc.

Look around for types of options, presently many savings accounts yield very poor results around 1.5% or so and as such 'money in the bank' could be used to better effect elsewhere.

Make sure you understand inflation, compound interest, etc.

Don't what ever you do go on one of these 'learn to trade' 'courses' or pass money to any of these '...once in a life time opportunity to...' - the ones with the very sketchy information and rather unclear development path. In truth, no one can begin to learn to trade and such without some experience in maths, that although will not be about mathematical proofs or anything academic serves to inform. Learn to read Volumes and do not freak out when stock 'moves'. I have heard of people who buy in at 50 pence, sell at a pound only for the asset to reach 10 pounds and then they regret it so resist the reactive, emotional states.

[PC Engine Fan X!]

If you do start with your employer's 401k plan, it is best to start at the maximum cap rate allowed. If you can't do that, then contribute to it at a lower percentage rate that you can afford to and increase it by 1% or 2% a year until it's at the highest cap allowed (by going this route, it won't hurt the pocket book that drastically).

It's never too late to open up a 401k account if your place of employment offers it -- "better later than never" as the ol' saying goes.

If you already had a 401k at your previous job, you can transfer it to your current job if they have another 401k plan in place and still keep contributing to it -- something to think about.

If the company or corporation that you work for offers a 401k plan, jump on it at the first chance if you are able to sign up for it. Some companies require that you be at least 21 years old and have at least worked for a minimum of 1 to 2 years before joining up on the company's 401k plan.

Trying to get to the first initial $100,000 hurdle within one's 401k plan will certainly take a good long while to reach (despite how the stock market is doing) -- it could take anywhere from 12 to 14 years or more (depending on the maximum contribution rate allowed on your 401k plan and if your company offers matching funds to it -- it'd take less time to break the initial $100,000 hurdle with matching funds easily). Some 401k plans allow up to 25%-50% of one's take home pay to be contributed to it without being taxed beforehand.

If you are the only sole contributor to your company's 401k plan (and if there aren't any company matching funds to it, consider it better than not having a 401k in the first place). It's just that when it comes time to make the proper withdrawls during retirement age at 67-70 (or thereabouts), then you'll be taxed when making a 401k withdrawl. That is to be expected in this day of age.

Upon breaking the initial $100,000 hurdle within one's 401k plan, the path to the next $200,000 hurdle goal won't take as long to reach (as you've already got money earning money for you to reach that milestone and beyond).

Despite the peaks and valleys of the stock market, the old sage advice is to do nothing with your 401k and leave it alone (you're in it for the long haul regardless of how the stock market does currently on a daily/weekly/monthly basis).

Do open up an IRA or Roth IRA -- you can roll your IRA into an Roth IRA but once done, it can't be reversed/changed. So consider the pros and cons of doing so in the first place. Of course, you can withdraw from an Roth IRA at anytime for any reason without any penality -- that is the perk/benefit of having a Roth IRA.

So let's say hypothetically, one has a 401k, an IRA or Roth IRA, a union pension (assuming if one works at a union job long enough to get it/earn it) and a big if, Social Security (assuming it's still around in ten to twenty/thirty years from now and not drained completely by the U.S. government raiding it like no tomorrow) -- this hypothetical retired person is doing better than most folks who haven't saved for retirement whatsoever, indeed, with up to four sources of income to count on during his/her retirement age/golden years. The more sources of income during retirement is better than having to settle for just one or two sources of income -- take this into consideration and use it to your advantage.

Sure, I've read horror stories of folks whom reached retirement age only to find out that they didn't save enough for retirement because of the fact that they didn't know that they were going to live so long (this ever-important factor/issue has to be taken into consideration as well). So the real question would be then, how long does one wish to live during their golden years & will there be enough retirement income to be able to live comfortably? Hmmm.....

As tempting as it sounds to raid one's 401k for unexpected emergencies and the like, it's better to borrow from it as a loan and back it back quickly as possible (you won't be penalized for doing so in going this particular route). But if you do decide to make a 401k withdrawl before retirement age, the U.S. government will hit you with a 20% penality fee (on top of whatever amount is withdrawn) -- is certainly a hefty chunk of change to give to Uncle Sam in doing so. So it's strongly recommended not to dip into your 401k whatsoever.

PC Engine Fan X! ^_~

[Stevens]

- Max out your 401k every year, without question. If you can't afford it, cut something out of your life. If your company offers a match, and you don't max out your contributions, you are pissing away money.

This. I can't really offer anything that hasn't been said already, but the topic certainly interests me.

I have a maxed out TDA in lieu of a 401k, similar but a little different.

[Frenetic]

Really appreciate the advice here. Just thought I'd give an update.

I maxed my 457(b) and Roth IRA after reading "The Bogleheads Guide to Investing" and joining the bogleheads forum.

My Asset Allocation is looking like this:
75/25 Stocks/Bonds

457(b)
65% Vanguard(R) Institutional Index Fund - Institutional Shares 0.04
35% Vanguard Total Bond Market Index Fund - Admiral Shares 0.05

Roth IRA
100% Vanguard Total International Stock Index Fund Investor Shares (VGTSX) 0.18

CAVE and RZNG PCBs (Battle Bakraid, Armed Police Batrider, Mushihimesama Futari Black Label, Dodonpachi, Mushihimesama) I keed, I keed...

-F

[Mrhide]

Sorry to sound grim but you can't take it with you when you die... so make sure you go and enjoy life everyday.

[MX7]

Sorry to sound grim but you can't take it with you when you die... so make sure you go and enjoy life everyday.

Exactly. The best investment you can make is to go to new and interesting places, to take lots of drugs, and to have sex with lots of attractive people.

[GaijinPunch]

Sorry to sound grim but you can't take it with you when you die... so make sure you go and enjoy life everyday.

Any chance I can take some of it with me when I'm retired, or old and can't work?

[MintyTheCat]

Sorry to sound grim but you can't take it with you when you die... so make sure you go and enjoy life everyday.

Exactly. The best investment you can make is to go to new and interesting places, to take lots of drugs, and to have sex with lots of attractive people.

We should really exchange numbers Sex would be a fine thing... When did the heady 20s become the monk like 30s?

[Frenetic]

Hey everyone, I've done a lot of research and have some updates for you all.

Like 1CC'ing a shmup there are strats so here are some that I have found so far.

Get a personal budget going in Google Docs it is free. Make a copy of the sheet that suits you and start entering your stats. Track your spending and this will help you get control (just like keeping track of your scores in shmup).
https://www.reddit.com/r/personalfinance/wiki/tools

1. If you are in debt decide what is good debt and bad debt and pay the bad debt down.
https://www.reddit.com/r/personalfinance/wiki/debt

2. Once you get yourself out of debt, think about investing in a Roth IRA/maxing out your 401k (if you are in debt and have a matching 401k then invest up to the matching because it is free money, 457 or any other form of deferred comp is great)

The Money Mustache forums are good for personal lifestyle changes. Take what you will about the early retirement goal but but the blog articles have great advice in health, wealth, and skills https://www.mrmoneymustache.com/

Bogleheads book and forum are great for asking for investment help (feel free to post your personal finance profile according to forum rules).
The Bogleheads Guide to Investing is a good guide.
http://doc.xueqiu.com/14cf53ebdeb1cd3fd7a1bfa2.pdf
https://www.bogleheads.org

Hope this helps,
the F-man

[austere]

• You are what you eat. Don't go cheap on food and perishable items, buy the best stuff. Don't look at the price tag (it's usually irrelevant anyway).
  
  Don't try to save money on accommodation if you end up going through long commutes. You're basically condemning yourself to only living on weekends if you do this.
  
  Avoid buying anything that requires a lot of maintenance, in the end that item will end up owning you more than you owning it.
  
  Avoid impulsively buying physically large or expensive items for any reason. Do your research on the item. Do you really need it? If you're mistaken, will getting rid of it cause you difficulties? My biggest mistakes have always been impulsive purchases.
  
  Don't invest in anything you don't understand. Ignore co-workers with "hot stock tips", you will almost always lose money.
  
  Save for the future (you won't be young forever) but don't go all out and restrict what you can do today with your money. The people who become successful don't do it by locking their money away until they're too old to enjoy it.
  
  Never get into serious debt for any reason, including housing. If you do the math on most things you'll find renting makes more sense as long as you're a professional. Housing goes through booms and busts, when you've saved enough and it busts, you can then take a small loan (with 40-60% principal) and pay it off in a few years rather than 10-30 years as some do. It's good to grow roots, just don't turn those roots into a coffin.
  
  Your health is your greatest asset, and as someone with very poor health, do take it from me that it's the thing you'll miss the most when (or if) it's gone. Avoid any kind of drug that you don't need, especially tobacco, alcohol and any kind of mind or mood altering drug. If you need to use Modafinil for performance, don't use it every day and make sure you don't screw up your sleep cycle. This is the way most people ruin themselves so stay completely clean and you'll go far.
  
  When all the cards are down, you are the only person you can truly rely on. Thus, the best investment you can make is in yourself. Get the most time out of your life for yourself and you will feel more satisfaction in everything you do. That satisfaction will bleed into your performance, which will get you noticed, which will ultimately mean more mobility and potentially more money. Always think about the time <-> money trade you're going to make. Even if it seems like a lot of money, if you're not going to be happy you won't last long and in the end you'll be a shell of your former self.

The last point is the most important one in my experience. I've made a lot amount of money on stocks especially via options. But the single investment I've made which has brought me the most amount of money is a $30 textbook. Life can surprise you in a positive way, if you let it.

[Bananamatic]

give me reasons to not live in a minimalistic way aside from others talking shit about you because you're weird

[Zen]

give me reasons to not live in a minimalistic way aside from others talking shit about you because you're weird

I guess all those reasons could be encompassed within the notion of "experiencing more things" which, of course, could also be looked upon as the neurotic push to externalise your existence in an attempt to hide from death
Which is not to say that hedonism is bad. Nor, is the austere, minimalistic life inherently "superior".
Perhaps the lesson is to meld an awareness of self with living, as much as is possible, in the moment.

Fucking hell! Off topic much? . . . or is it?

[Mortificator]

When did the heady 20s become the monk like 30s?

Around the start of this little thing called "The Great Depression."

[Skykid]

give me reasons to not live in a minimalistic way aside from others talking shit about you because you're weird

I guess all those reasons could be encompassed within the notion of "experiencing more things" which, of course, could also be looked upon as the neurotic push to externalise your existence in an attempt to hide from death
Which is not to say that hedonism is bad. Nor, is the austere, minimalistic life inherently "superior".
Perhaps the lesson is to meld an awareness of self with living, as much as is possible, in the moment.

Fucking hell! Off topic much? . . . or is it?

I thought it was a good answer to the question.

I agree. I think one of the eternal struggles in life is learning how to live, personally, in a way that you feel satisfied. It's hard work to even get close, and it's an ever changing ball game from one year to the next. Smart investment is definitely part of that element of satisfaction and I think this kind of thread is encouraging and worthwhile if it helps someone to take stock.

[MintyTheCat]

• You are what you eat. Don't go cheap on food and perishable items, buy the best stuff. Don't look at the price tag (it's usually irrelevant anyway).

I couldn't agree more: eat properly and do not eat the absolute trash that many would have us believe was 'food' - McDonalds, etc.

Don't try to save money on accommodation if you end up going through long commutes. You're basically condemning yourself to only living on weekends if you do this.

If you can avoid commuting then avoid it but also, if for example you live in London and it's pretty dirty and horrible, well, live somewhere nicer that's a similar distance travel wise.

Avoid buying anything that requires a lot of maintenance, in the end that item will end up owning you more than you owning it.

Those expensive coffee machines are a good example of this. I agree though: don't be a slave to an object/device.

Avoid impulsively buying physically large or expensive items for any reason. Do your research on the item. Do you really need it? If you're mistaken, will getting rid of it cause you difficulties? My biggest mistakes have always been impulsive purchases.

To be honest, I prefer to buy second-hand but good quality wooden furniture or things that no one wants. Sure, the place will not 'match' but I really don't mind. I tend to give things away too if there's something that could help another person.

Don't invest in anything you don't understand. Ignore co-workers with "hot stock tips", you will almost always lose money..

My uncle's advice too and I agree. Yes, there's little point in following the trend and what people around you say. The worst you can do is to blindly believe them and then follow their direction. Much better to find out for yourself.

Save for the future (you won't be young forever) but don't go all out and restrict what you can do today with your money. The people who become successful don't do it by locking their money away until they're too old to enjoy it.

It's a balance: live on a 1/3, save a 1/3 and use a 1/3 to pay for living expenses. But also, don't just save and save as man of us will not reach retirement and perhaps not in the health that we'd like to have to enjoy it more.

Never get into serious debt for any reason, including housing. If you do the math on most things you'll find renting makes more sense as long as you're a professional. Housing goes through booms and busts, when you've saved enough and it busts, you can then take a small loan (with 40-60% principal) and pay it off in a few years rather than 10-30 years as some do. It's good to grow roots, just don't turn those roots into a coffin.

I agree: I will only buy properly for the most part in cash. A couple of my friends either saved long-term or bought in cash property and they could do it as they waited for the right time.

Your health is your greatest asset, and as someone with very poor health, do take it from me that it's the thing you'll miss the most when (or if) it's gone. Avoid any kind of drug that you don't need, especially tobacco, alcohol and any kind of mind or mood altering drug. If you need to use Modafinil for performance, don't use it every day and make sure you don't screw up your sleep cycle. This is the way most people ruin themselves so stay completely clean and you'll go far.

Health is the thing that binds it all together: mental and physical.

The last point is the most important one in my experience. I've made a lot amount of money on stocks especially via options. But the single investment I've made which has brought me the most amount of money is a $30 textbook. Life can surprise you in a positive way, if you let it.

Education, yes.

[Despatche]

Somewhat off-topic, but I strongly agree with the "health and personal finance/standing are closely linked" bit. In recent years I've come to believe that coffee in general is just a bad drug to get addicted to, and going clean would only provide a net benefit. Am I right in believing this? It would certainly save on money, assuming you don't get lucky and have free coffee wherever.

[MintyTheCat]

Somewhat off-topic, but I strongly agree with the "health and personal finance/standing are closely linked" bit. In recent years I've come to believe that coffee in general is just a bad drug to get addicted to, and going clean would only provide a net benefit. Am I right in believing this? It would certainly save on money, assuming you don't get lucky and have free coffee wherever.

I never used to drink coffee at all in England but I drink it over here. I think the important thing is to notice how we develop dependencies and pretty much come to rely too much on things. I limit myself coffee wise and alcohol wise.

[neorichieb1971]

Investing for most of us is tough because just making ends meet and going out is a stretch for some of us. I'm in the UK and my house is still going up faster in value than I can save. Which is good because I can save a little. I am in my companies share save scheme and have a modest 5 figure sum tied up in that and I put into my pension as well.

The problems arise mostly when you lose your high earning job and can't replace it. At these times you have a void, have to sell things. Sometimes a bad marriage can bring a man to his knees, I can tell you from first hand experience. So if you are saving 5 figures a year your in a club of fortunate people and you should be able to have a healthy life. But just don't count on a smooth road all the way through life unless you can take some massive hits without a tough rebound.

[Specineff]

Don't have kids before you're ready for them... or if you don't want to be enslaved to child support. Fuck smart, wear protection.

[Xyga]

Well where I live unless you're an an engineer, lawyer, upper echelon manager/civil servant, decently successful entrepreneur, boomer with a fat pension or happy successor/inheritor, whatever that pays at the very minimum 2,500€ a month after major taxes, there's nothing you can invest in to.
15~20 years ago it was still okay for the major portion of the working class to make projects and invest, but today if you're not at least an entry-level bourgeois any amount you've got left is just pocket money you can spend on smartphones and booze.
All the people I've met who thought they could make even a bit of money in stocks at their dirty peasant level basically failed even ending up in the negative for some.
Banks refuse to breathe the same air as plebs and won't even pick up the phone if you're not in their book.
Unless you turn yourself into a hungry shark and dedicate all your time and resources to money making you have no hope, or you'll have to cheat the system walking on eggshells because it's very tricky. To be really successful you need to adopt and master both the shark and cheat attitude, it is also important to note that quite a lot of people I know who are well off and shouldn't technically need to cheat...actually do, not always by greed but because they can't swallow the insane taxes.
If I really cared about making money I think moving to a different country would be at the top of my to-do list, even if that meant only a 10% difference at the end.

[MintyTheCat]

Don't have kids before you're ready for them... or if you don't want to be enslaved to child support. Fuck smart, wear protection.

Pearls of wisdom. Don't get roped into 'having kids'.

[Cee]

give me reasons to not live in a minimalistic way aside from others talking shit about you because you're weird

Basically this, the first step is to know yourself and what you want from life then go from there and be strong minded to reject all peer pressure, i've always found that bit easy but many don't.

Somewhat off-topic, but I strongly agree with the "health and personal finance/standing are closely linked" bit. In recent years I've come to believe that coffee in general is just a bad drug to get addicted to, and going clean would only provide a net benefit. Am I right in believing this? It would certainly save on money, assuming you don't get lucky and have free coffee wherever.

Yes always reject the encouraged by marketing attitude of wants over needs to create dependent moronic consumers, will power, self control and attaining high standards set by self are very fulfilling ways to live even if the vice slave degenerate retards here will try to say otherwise.

I guess all those reasons could be encompassed within the notion of "experiencing more things"

Wrongful correlation living a minimalist lifestyle doesn't equate to not doing new/trying new things it merely states the position of the home life and a general philosophy moving forwards, i've tried lots of things and traveled a lot and still found i just like being anywhere with bare essentials and my interests to progress with, nothing else matters for me.

Exactly. The best investment you can make is to go to new and interesting places, to take lots of drugs, and to have sex with lots of attractive people.

No thanks and you sound like every fresh off the assembly line idiot student ever, it's sad how people take the "you're going to die so fuck it" as an excuse to be a squalid barely north of animal hedonist rather than using the perspective for the same position to validate reason to be the best you can be, be disciplined, work hard at your chosen pursuit, maximize your potential through good health, discover how good you can become at things for it's own sake, eat smart and well, read more, have self respect ect and you'll be a far more confident fulfilled individual than any chaotic scum lord defaulting on the laziest and easiest options because he lacks the intelligence to make the nihilist perspective work for him without spoonfeed.

[MintyTheCat]

This may be of interest to some of you:

https://www.mckinsey.com/industries/hig ... -the-world

[Stevens]

Don't have kids before you're ready for them... or if you don't want to be enslaved to child support. Fuck smart, wear protection.

I'll add to this if I may - If you fall into the camp of never wanting kids and you are absolutely certain of it you should seriously consider a vasectomy.

If you are single and eventually want to get married there are obviously consequences - it will limit your potential choice of people you can settle down with as kids/no kids is one of the biggest deal breakers for people.

If you are in the camp of no kids (not you specifically) and are up front and honest about it you will eventually find someone like minded. It offers a ridiculous about of financial flexibility.

I would be happy to discuss this stuff further with anyone that is curious. Elsewhere if too OT.

[GaijinPunch]

Don't have kids before you're ready for them... or if you don't want to be enslaved to child support. Fuck smart, wear protection.

I'll add to this if I may - If you fall into the camp of never wanting kids and you are absolutely certain of it you should seriously consider a vasectomy.

If you are single and eventually want to get married there are obviously consequences - it will limit your potential choice of people you can settle down with as kids/no kids is one of the biggest deal breakers for people.

If you are in the camp of no kids (not you specifically) and are up front and honest about it you will eventually find someone like minded. It offers a ridiculous about of financial flexibility.

I would be happy to discuss this stuff further with anyone that is curious. Elsewhere if too OT.

If you think of the total amount of money kids will cost you it baffles the mind we have over population.

[Stevens]

If you think of the total amount of money kids will cost you it baffles the mind we have over population.

I was at work one day around the time I was turning 30 and it just sort of hit me in the face that I didn't want kids. Started talking to my Dr. about it shortly after that. It is one of those moments I remember like it was yesterday since it is one of those decisions that would shape the rest of my life.

To be fair kids cost far more than just money. I'm not here to shit on people who want kids or have them. Some people have kids, love being parents and are damn good at it, but it isn't for me. I've got a fair amount of nieces and nephews, that's enough for me.