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So I suppose I should check in to see if I'm doing this whole "investment" thing right. I'm 25 and been working at my "career" job for about half a year now. I contribute 8% of my paycheck pre-tax to my 401k, and my employer contributes 6% - half of this goes into the company stock fund. I put 100% of my portion into a Lifecycle 2050 fund (ran by ING), because I've been getting a 15% return on my investments. I think the only better performing fund was the Science & Technology Fund. Every now and then, I sell the stock fund and move those funds over to the Lifecycle 2050 funds, because the company stock funds never perform to the level that the Lifecycle fund does. Anything I should be doing differently? I'm pretty happy with 8% for now, since it's the maximum that my company will match (matches 100% for the first 4%, 50% for the next 4%).
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Oct 29, 2012 15:37
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| # ¿ May 13, 2024 07:00 |
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Alereon posted:First, as a general rule you do not want to hold your own company's stock as part of a retirement account. This is for risk control: If your company goes bankrupt, not only are you out of a job and your source of income, you lose the retirement savings that were invested in the company. The only plausible exceptions are if you believe your company will beat the market long term (and keep in mind that you are probably not able to predict the company's performance and it will cost you a hell of a lot if you are wrong), and/or can buy the stock at a discount below market through an employee stock purchase program (and even then it probably isn't smart to hold it long-term). That makes sense. That's generally why I usually end up selling the stock once I get a decent amount of it and convert it into Lifecycle 2050. I'm not too worried about my company going under, though. Also, my life cycle fund is custom to the company. The expense ratio is $4.30 per $1000. When I first invested as an intern last year, the market took a terrible crash, and I ended up losing about 10% in the middle of the year, but gained it back (and then some) by year end. I definitely realize that these things fluctuate. seiferguy fucked around with this message at 02:11 on Nov 7, 2012 |
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Oct 30, 2012 02:00
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401k contribution question: I've been keeping my money in a Lifecycle 2050 fund and not really worrying about it. It's 3-year performance (which is about the time I've had it) it's averaged a 14% gain. It's pretty good, but there are some indexed and actively managed funds that have fantastic performance over the same period. The large companies and S&P 500 funds have gotten 20%, and the science and tech fund has gotten 24%. I've decided to readjust that going forward, to put 20% into the Lifecycle 2050 fund, 30% into S&P 500, 20% into Large Companies, and 30% into science & tech. Good idea / bad idea? The The other thought I had was to reallocate current money from my Lifecycle fund into the others, so that I start earning better interest on those accounts. Not sure what's the best option here.
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Jan 26, 2015 19:34
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Droo posted:Why do you think the Lifecycle 2050 fund has lagged behind the other things you are looking at? I know Lifecycle funds are diversified to minimize risk, though earlier funds (i.e. the 2050 and 2055) are going to be tilted more toward riskier investments (stocks and whatnot), with only about 10% in bonds. Leperflesh posted:First: You are paying attention to returns, but (I think) not paying attention to risk. Risk is a critical component to any investing decision, and the key reason that passively-managed index funds are recommended here (they perform well given their low risk profile). This is great advice. Thanks. For the part I bolded - do you have reading material that is worth reading? So far, my funds are still mainly allocated toward the Lifecycle fund. The only real investment advice I've gotten has been from my dad, which has been "you're relatively young, take investment risks, since it's not going to hurt you as much as it would me." I do realize the market has performed well for awhile (my company stock has risen significantly over this time, and finally tapered off). I imagine the market will begin to slow at some point, which upon thinking about it, is probably a bad time to begin investment in risky funds. pig slut lisa posted:Your Lifecycle 2050 fund almost certainly includes some bond allocation, which would depress your returns below what a straight S&P fund would have returned over the past 3 years of the market's excellent performance. If your investing is predicated on a multi-decade time horizon, you may well want to manually reallocate between bonds and stocks, and even tilt more heavily towards the latter. So far I'm 27, almost 28 and had about a 14% increase, I just see the other gains and think "man I could have done better" which is probably a bad thought process. I'll minimize my science & tech contributions. Sheep games are fun as heck. I need to do more of them 
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Jan 26, 2015 20:52
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Thanks everyone for the advice. I'll hold on to my lifecycle fund and then start reading a book in the OP before making any rash decisions. Overall I probably should be pretty happy with a 14% return thus far.
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Jan 27, 2015 07:57
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Question: My company matches up to 75% at 8% for my 401k (so 6% match) plus a 3% company contribution that escalates up to 5% when I hit my mid 40s no matter what my election preferences are. I've been putting in 8% since that's been giving me free money. Upon looking at my budget, I think it's time for me to up my contribution to 10%. Since the company won't match an additional 2%, would it make sense to put it into a Roth IRA instead? The Roth won't have much money since 2% isn't much and I won't come close to hitting the max Roth IRA anyways. That no-tax post retirement deal sounds pretty sweet.
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May 6, 2015 17:23
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My understanding is that up until you're about age 40, it pays to be relatively aggressive, since the only time people have lost money on aggressiveness has been in the great depression. Every other time it's happened, the market bounces back and investors get back what they lost (and then some). The market is tanking a lot right now, but I'm gonna tell myself not to look at my 401k and Roth to see how bad the recent growth has been.
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Jan 18, 2016 20:04
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Alright I'm finally in a spot to start seriously saving, both for retirement as well as for a large expense (ideally a house). I finally got off my rear end and rolled over my previous employer's 401k into my current, and should have that posted next week. Here's the current plan: 401k: my employer matches 4% if I do 6%. I have 8% going in there now. Roth: I had a Roth I rolled over from my previous company, it didnt have much in it but I wanted to start by adding 7% (so with the 8% plus this I'm at 15%, pre and post tax). High yield: I created a HYS at 1.7%, put in a large deposit and plan to basically do a monthly transfer of my checking to that for all leftover money not for bills. Ideally I'd have a house fund over time as this is relatively liquid. I plan to change my allocations once my transfer goes through to 70/20/10 or so. Am I missing something or any tweaks I should at for this plan?
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Feb 21, 2020 22:26
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Hoodwinker posted:This looks good! A good next step would be to write a budget so you can find out what you can adjust to save even more money. How old are you and when are you interested in retiring? I'm almost 33, probably looking to retire in the 60-65 range (my parents got lucky and retired at 62, so I'd love to hit that too). I'm moving in with my girlfriend so I'll be saving even more in terms of expenses. Sock The Great posted:Looks good, but I would never roll an old 401k into another 401k. You should instead toll this into either a Roth IRA (you'd need to pay the taxes) or a Traditional IRA (no taxes). The investment options in an IRA (i.e the entire stock / bond / REIT etc. market) are almost certainly better than whatever overpriced mutual funds you have access to in your 401k. Well poop, I already submitted it. My currently company uses fidelity, but I'm hoping to quit my job real soon as soon as I can find a better one!
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Feb 21, 2020 22:43
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When I had my first job that had a 401k match that I started to contribute to, the market started taking a poo poo as I was investing in a life lifecycle 2050 fund (can't remember what caused that particular panic at the time) but I've held steady and that got around a 15-20% gain over the life, and changed investments into the 2055 and 2060 when they became available. I'm mixing up my investments a bit but basically I plan to be pretty aggressive until I hit my 40s. My understanding that unless we have a great depression style crash, the market will bounce back and funds will give you a net positive.
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Feb 25, 2020 17:05
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If I have the ability to, should I just drop the max $6k as a lump sum into my Roth IRA and then just focus on my traditional employer 401k with my regular direct deposits? I could do a % of my paycheck but I feel like I’d screw up and accidentally go over.
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Feb 28, 2020 16:23
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KYOON GRIFFEY JR posted:i prefer hit it once and forget it, if you have the ability time in market beats DCA in general That was my line of thinking. I can probably get it in before tax day no problem. I figure $6k of return now is going to be better than slowly getting up to $6k over time. Pollyanna posted:What happens if you accidentally go over? Tax penalty, but if you catch it beforehand you can adjust prior to penalty. Until you’re making over $124k a year, you can do $6k max per year.
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Feb 28, 2020 16:34
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Finally put in my stock split (Fidelity): 70% FXAIX (Fidelity 500 index), .015% exp ratio 20% FSPSX (Fidelity Intl Index), .035% exp ratio 10% FUAMX (Fidity Intermediate Treasury Bond Index), .03% exp ratio Looking good? I mainly was going for low expense ratios, and this seemed to be a good mix while showing good returns in the past few years.
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Mar 10, 2020 00:14
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With the tax deadline being moved out, does that mean contributions to a Roth for 2019 are extended too? Fidelity is taking forever to link my credit union (still in prenote status) so I can drop my max in before end of the fiscal year.
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Mar 18, 2020 16:36
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Gazpacho posted:The postponement applies only to the timely payment of income tax due on April 15. See if Fidelity offers a form for contributing by mail. Yeah if I don't see anything by the end of the week I was going to call and see if I can do a virtual check or one by mail. I'm assuming the hellworld is delaying it.
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Mar 18, 2020 22:50
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My bank finally linked to my fidelity account, and I’m about ready to drop $6k in my Roth for 2019, then I get my annual bonus next month and could drop another $6k in for 2020. I guess my biggest concern is the massive downturn in the economy and if I should hold on to that in case there’s job layoffs. I’m fine investing now even if I expect the market to continue to kind of tumble for a bit, it’s more a worry of having emergency funds. Thoughts?
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Mar 20, 2020 22:34
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Thanks for the responses, all. I’ve probably got about 5-6 months of money (probably more, if I lost my job I would cut back a ton on some of the things I spend on) in a HYS, plus a couple more months that would be left over between my checking / savings at my credit union if I took $6k out of there. I might just do $3k for 2019 and see how April plays out. I’m in procurement consulting, which sounds like the type of service that would get axed first by clients in the wake of any downturn. But to my company’s credit, they’ve not had layoffs (yet). I have a lot of experience and I think there will always be procurement jobs so I think I could bounce back on my feet if it happened. Edit: putting it into the Roth as cash for the time being then converting it to stock/index funds/etc at a later point is actually a great idea, and I don’t lose out on 2019 contributions but could still have money available if I absolutely need it. seiferguy fucked around with this message at 23:34 on Mar 20, 2020 |
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Mar 20, 2020 23:32
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I'm starting a new job on Monday, that's gonna give me a higher base salary and also equity / RSUs as a part of my total comp. My main goal is probably to buy a house in a couple of years, and my strategy had been saving roughly $2500 a month (so, $30k a year), and on top of that I have roughly $30k saved, so in 2 years I should have $90k in savings plus I can sell some / all of the equity I'll have as necessary plus any money from my girlfriend / partner that she gets as part of her comp. I'll probably house hunting in the south bay area and looking at houses they're around $1mil, so it'd be easy to have at least 10% for a down payment provided housing prices don't get even crazier. I have a plan to max my yearly roth contribution and I'll be contributing 10% of my salary (this won't get me to the 18k max but close) to my 401k while my employer will match around 4%. My questions: 1. For saving for a house, I'd basically been moving my money into a HYS - when I started the account this year, the rate was 1.73%. It's shrunk to .65%. Should I continue using high yield savings, or invest it elsewhere considering the rate sucks? 2. Would it be better in the short term to reduce my 401k contribution for saving for a house then switch back after the purchase? 3. Anything else I'm missing?
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Oct 15, 2020 17:51
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H110Hawk posted:1. Leave it. FDIC insurance is what you're buying. Consider that hmbradley account people are pimping here. 1. That HMBradley account looks good. If I just set up my direct deposit to have most of it go to my regular checking, and then part of it to an HMBradley account, that'd qualify as the monthly check and also since I wouldn't really be touching it, I'd qualify for the 3%, right? 2. Yeah, upon looking at the numbers it would probably be better to get a 20% down payment to reduce the overall payment as well as avoid PMI. It depends on my total comp and how it fluctuates / how the value of my RSUs respond. 3. Good point, we'll likely be married (or be planning for it then) but regardless I'll make sure I'm covered legally with a contract if that doesn't end up being the case for whatever reason.
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Oct 15, 2020 19:23
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I opened up an HMBradley account, should be getting to tier 1 status in April. Even at 1%, it's better than my current HYS (Synchrony bank, a pitiful .55, way down from 1.73% when I signed up). There's no penalty for me to just transfer all my money over to that account, right? HMBradley won't support a connection with Synchrony so I'd move the money to my credit union first then to HMBradley.
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Feb 9, 2021 00:52
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A couple questions: - I figure this has probably been asked at some point, but: I snagged the HMBradley account that was all the craze awhile back and got their 3% HYS. However, since it's so popular they knocked it down to 1% unless I get a credit card of theirs and spend $100 a month minimum. I was thinking of doing that and then just putting my cable bill or something on there monthly. Is this a good idea / bad idea? - I get RSUs from my company, and well... I've been very lazy about reinvesting them. They're market sensitive, and probably realized it's time to sell / reinvest / diversify. Is there a good spot on doing this? I can only do these in my trading windows, which isn't too big of a deal. Also, with the economic downturn, my RSU value has lost a lot of money, so I'm not sure if I should wait for recovery or just say gently caress it and start diversifying.
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Feb 23, 2022 22:56
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Just got an email that HMBradley is shutting down their deposit program and closing all accounts Dec 15  It was good during the low interest rates, but once they rose I had more or less moved everything to Synchrony anyway.
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Nov 15, 2023 18:38
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| # ¿ May 13, 2024 07:00 |
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Since we are talking roths / IRAs I did my annual contribution then found out since I filed jointly with my wife, I'm probably over the income limit for contributing to my roth. I use fidelity - I'll probably call them and get it sorted out, but it sounds like an alternative is I can put it in a traditional IRA then... backdoor it into my roth?
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Apr 14, 2024 03:52
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