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disclaimer: i know that i like money. problem is i do not know anything about stocks, bonds, or finance in general. so given that the recession is seen to be near, i'm interested in reallocating the funds in my 401k to bonds. from what i understand bonds are where it's at at this time, if you believe the recession is coming of course. is that true? or is it too late? if it's not too late, my 401k manager offers 4 portfolios:  thoughts on what might be better? i'm willing to tolerate a lot of risk if the conditions make sense and the upside is high enough. but again, i don't know how any of this works, so reaching out for advice. there's about 27.5k to work with here. thanks for any and all help, including calling me an idiot and telling me to go gently caress myself. currently these funds are out of all investments and are just making a flat 1% because the market loving scares me and it all seems disconnected from reality. but i don't think that can continue much longer and i don't think it's going to shoot up when it comes back to earth.
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Aug 14, 2019 17:24
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Don't try to time the market
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Aug 14, 2019 17:27
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brugroffil posted:Don't try to time the market
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Aug 14, 2019 17:36
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But what about today, where a crash is obviously coming and also this time it's different™?
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Aug 14, 2019 17:38
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GoGoGadgetChris posted:But what about today, where a crash is obviously coming and also this time it's different™?
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Aug 14, 2019 17:43
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Hoodwinker posted:long wet fart sound So you're long on FART? Care to provide your anal-ysis? edit: my monthly draft comes out tomorrow and then shares get purchased all on auto in my SEPIRA so maybe I'll get a lucky bit of timing out of this
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Aug 14, 2019 17:49
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abelwingnut posted:disclaimer: i know that i like money. problem is i do not know anything about stocks, bonds, or finance in general. Unless you're nearing retirement age and going to take money out soon, don't worry about your portfolio value going down. We all recovered from the '08 recession. Value will go back up, even if it takes 108 years. tangy yet delightful posted:So you're long on FART? Care to provide your anal-ysis? Boo, just boo
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Aug 14, 2019 17:51
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"Long FART" is going to be my new investment advice for people asking what to put their money into when they want to time the market.
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Aug 14, 2019 17:51
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abelwingnut posted:disclaimer: i know that i like money. problem is i do not know anything about stocks, bonds, or finance in general. We would need a lot more info from you. Age, when you want to retire, how much you are interesting each year, etc. Also need to see all the funds in your portfolio and the expense ratios. Generally pulling all your money out of stocks and keeping it as cash is a bad idea, which it sounds like you already did. You can't time the market. If you want to have more bonds that is fine but you have to be realistic about your goals.
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Aug 14, 2019 18:07
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I’m at a new company and there is no 401k match. The fund selection is also pretty lovely, but I think they have a decent S&P 500 index with ER 0.05%. I am comfortable saving enough to max my 401k space, but with lovely funds and no match should I bother? Should I just redirect such funds into my taxable brokerage? I guess tax-advantaged is still better than taxable even with no match. My last company had a great match and great funds so I’m just a little lost with the transition. I am also planning to backdoor max Roth IRA FWIW.
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Aug 14, 2019 18:17
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The tax advantaged space is still massively beneficial and a 5bps S&P500 index fund isn’t poo poo at all. It’s not just about a match.
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Aug 14, 2019 18:20
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The steps in the OP still apply, you're just skipping step 1, "contribute to your 401k up to the employer match." Step 2 is the IRA, which you're already doing, so you're on step 3, maxing out the 401k. And yeah your choices don't sound that bad to me.
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Aug 14, 2019 18:23
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Ok cool, thanks. The other funds offered are considerably worse and I do need to confirm this one is 0.05% and not 0.5%.
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Aug 14, 2019 18:32
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0.5% would be bad but it's not the worst we've seen in this thread and I'm pretty sure it's still better than not being in a tax advantaged account would be. You could also bug your HR people about getting better funds.
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Aug 14, 2019 18:40
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One thing to consider about stocks is that they are way better at dealing with inflation than just holding something like cash as stock prices tend to go up like anything else.
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Aug 14, 2019 18:49
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abelwingnut posted:so given that the recession is seen to be near, I love this. But seriously, don't time the market. Don't switch to bonds. Continue to invest as you have.
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Aug 14, 2019 18:52
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Sock The Great posted:I love this. Right now it seems like that is cash for him which is not ideal.
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Aug 14, 2019 19:00
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abelwingnut posted:so given that the recession is seen to be near, Economists have predicted 9 out of the last 5 recessions.
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Aug 14, 2019 19:41
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On a long enough timeline, a yield inversion has always preceded a recession. I dare anyone to act on this knowledge
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Aug 14, 2019 20:02
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https://www.schwab.com/resource-center/insights/content/does-market-timing-work
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Aug 14, 2019 20:13
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GoGoGadgetChris posted:On a long enough timeline, a yield inversion has always preceded a recession. over a long enough timeline, gggc talking about his m2 has always preceded a recession
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Aug 14, 2019 20:45
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Wow, drat, am honored to have chosen the new thread title (credit to American Nobel Laureate Economist Paul Samuelson, whose joke I shamelessly bastardized).
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Aug 14, 2019 20:47
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This is a great article. 1955-1974 2 3 4 5 1 Hah, see! Don't buy stocks! As long as you need all your money immediately as OPEC stops exporting oil... and, these days, along with everyone else. OPEC embargo declared Oct 1973. Interestingly, the all-cash also performed decently ending in 1981, two years after the start of the second oil shock. But this makes sense, as the cause of this was not a sudden cease of production but rather concern that oil production would fall due to the Iranian Revolution (around end 1978-early 1979) and the Iran-Iraq war (Sept 1980). totalnewbie fucked around with this message at 23:13 on Aug 14, 2019 |
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Aug 14, 2019 23:08
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Solumin posted:0.5% would be bad but it's not the worst we've seen in this thread and I'm pretty sure it's still better than not being in a tax advantaged account would be. They said its .05% not .5%, and .05% for an S&P index fund is pretty good.
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Aug 15, 2019 14:09
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DJCobol posted:They said its .05% not .5%, and .05% for an S&P index fund is pretty good. Though a 401K that ER for an index fund is amazing. I pay .64 for the privilege of buying VTSAX.
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Aug 15, 2019 14:15
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DJCobol posted:They said its .05% not .5%, and .05% for an S&P index fund is pretty good. They also said, "I do need to confirm this one is 0.05% and not 0.5%," and I was trying to make the point that 0.5% would not be the end of the world and still better than putting it in a regular account. Sobriquet posted:Ok cool, thanks. The other funds offered are considerably worse and I do need to confirm this one is 0.05% and not 0.5%.
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Aug 15, 2019 15:43
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Sock The Great posted:Though a 401K that ER for an index fund is amazing. I pay .64 for the privilege of buying VTSAX. that's murder, i have 15 bps for my fidelity total market index
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Aug 15, 2019 15:55
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KYOON GRIFFEY JR posted:that's murder, i have 15 bps for my fidelity total market index My boss told me this morning that he is upping his 401k contributions beyond the minimum to get the match. I asked him if he and his wife had IRA's. He said no. I just about flipped my desk.
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Aug 15, 2019 16:03
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Sobriquet posted:Ok cool, thanks. The other funds offered are considerably worse and I do need to confirm this one is 0.05% and not 0.5%. I found an Irish S&P ETF at 0.07% so that's what I'm gonna get now that I figured out how to buy US ETFs and got the trading platform working. But speaking of timing the market, drat. I've been purchasing subsidized shares and contributing to the local 401k thing monthly but still ended up with more than reasonable amount of cash in various low-yield accounts. I have no problem keeping the regular investments, but dumping a ton (for me) of cash into it now doesn't look that attractive. I've read the article but that's a different situation - there the equal payments are made annually instead of a lump sum which could significantly weigh down the return. Imagine buying into the Nikkei in '89 lol. Still, it's probably better to at least crank up the monthly investments...
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Aug 15, 2019 18:28
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0.05 is solidly in the range of great, the often-championed VTSAX is 0.04 so I don't know how much lower you're expecting to find. Also if you've got money available that you want to invest, the best day to invest it is always today. If the market is down today, so much the better 
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Aug 15, 2019 18:35
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mobby_6kl posted:0.05%. Not great, not terrible.  Kylaer posted:Also if you've got money available that you want to invest, the best day to invest it is always today. If the market is down today, so much the better I invested yesterday. 
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Aug 15, 2019 18:38
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H110Hawk posted:
I invested today because today is payday 
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Aug 15, 2019 18:43
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Motherfucker. So all this "I invested blah blah" prompted me to check my current 401(k) to see when my contributions/matches generally hit relative to pay day, and then I discovered that my new job has a $10/quarter recordkeeping fee. No big deal, but then I thought, "I should check my old 401(k) to see if it had any annual fees." I sorted by transaction type and come to find that there was a negative "employer match" done about 6 weeks after I quit that they did to claw back the match from my final paycheck. I was already pissed that they booted me 1 week after I gave 2 weeks notice to save a few bucks on pay/benefits, AND they screwed me out of my bonus (I gave notice like 3 days before bonuses were announced). Now I find out that they dinged me a few extra bucks of match. They can eat a bag of dicks. I'm extra pissed because the dollar figure they took out is HIGHER than what they put in (by like $1.50). I know this is probably due the price fluctuation between when they clawed it back and when it actually hit, but goddam that's insult to injury (it's not earnings they're clawing back because the number of shares is different). Anyone know if this is legal? It seems illegal... DaveSauce fucked around with this message at 21:16 on Aug 15, 2019 |
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Aug 15, 2019 19:07
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Your old company's 401(k) almost certainly laid out in detail exactly how and when you earn your matching money, and what they did probably conforms to it. Nobody can tell you if they broke the rules without seeing your detailed plan documents.
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Aug 15, 2019 20:07
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Leperflesh posted:Your old company's 401(k) almost certainly laid out in detail exactly how and when you earn your matching money, and what they did probably conforms to it. Nobody can tell you if they broke the rules without seeing your detailed plan documents. Yup I figured that much. I'm going to see if I can get the plan details from Vanguard. The "overview" on Vanguard's site states the match is per employee contribution, but I'm pretty sure it's based on salary. In any case, I know the overview isn't binding... but in any case, my contribution went through for that paycheck, so it would follow that I'm still eligible for the plan, which I would expect means I'm still eligible for match. In any case, they can still eat a bag of dicks.
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Aug 15, 2019 21:15
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brugroffil posted:Don't try to time the market I came here to receive this answer in a more convincing way so, what do I stand to lose by shifting my 401(k) from thirds in domestic index, foreign index, and bonds, to 100% bonds for a few years? I assume it depends on how much time is left in the plan for the difference to compound over, but I'm not convinced that the average growth of the past century should be assumed for the coming century anyway, also I feel like I'm being forced by Vanguard to depend on things like private prisons that I'm personally trying to destroy
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Aug 16, 2019 01:58
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Stinky_Pete posted:I came here to receive this answer in a more convincing way so, what do I stand to lose by shifting my 401(k) from thirds in domestic index, foreign index, and bonds, to 100% bonds for a few years? I assume it depends on how much time is left in the plan for the difference to compound over, but I'm not convinced that the average growth of the past century should be assumed for the coming century anyway, also I feel like I'm being forced by Vanguard to depend on things like private prisons that I'm personally trying to destroy If you're right and there is a recession, probably only -5%. If you're wrong probably like -20%. Remember, the most successful investors are dead ones.
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Aug 16, 2019 02:01
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DaveSauce posted:...but in any case, my contribution went through for that paycheck, so it would follow that I'm still eligible for the plan, which I would expect means I'm still eligible for match. How long were you there? Matching contributions typically vest over a period of 2-5 years. I just timed quitting a job that had 50% vesting cliffs at years 1 and 2 and came out with double what I would have if I hadn’t calculated my dates very carefully. In general all employers can eat dicks from a bag, though, yeah.
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Aug 16, 2019 02:04
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H110Hawk posted:If you're right and there is a recession, probably only -5%. If you're wrong probably like -20%. Remember, the most successful investors are dead ones. Makes sense thanks
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Aug 16, 2019 02:07
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Sobriquet posted:How long were you there? Matching contributions typically vest over a period of 2-5 years. I just timed quitting a job that had 50% vesting cliffs at years 1 and 2 and came out with double what I would have if I hadn’t calculated my dates very carefully. I'll never again accept a job with that kind of vesting schedule. I waited more than a year to leave a dead-end job because of that, while the job I left it for had the match vest immediately.
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Aug 16, 2019 02:13
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