Investing megathread extravaganza

[DaFace]

A place to talk about investing stuff.

[Discuss Thrower]

Originally Posted by jerryaldini

This is gonna be great for retail ETF usage and further erode mutual funds.

Which might be bad for overall price efficiency if all the money pours in to indexed ETFs.

[Rain Man]

Etrade is now down to zero. I just need Fidelity to do it now, and I'll be golden.

https://www.cnn.com/2019/10/02/inves...ons/index.html

[MahiMike]

Can anyone recommend a budgeting app w/drag and drop capability? We were using EveryDollar from Dave Ramsey and loved it. Problem is, my little credit union isn't letting us connect to the app any longer.

The great feature with it was a drag and drop function to move each transaction over to the category in the budget it went with.

Any other apps like that?

[ChiliConCarnage]

Originally Posted by Rain Man

Etrade is now down to zero. I just need Fidelity to do it now, and I'll be golden.

https://www.wsj.com/articles/fidelit...ro-11570680060

I thought they might hold out a while and see if it hurt them much. Both Fidelity and Vanguard make a lot through corporate retirement accounts. Maybe they'd collected enough feedback already from ppl willing to transfer

[-King-]

What's worth putting 2500 on right now? This is a my small portfolio right now should I just add on to one of these or buy something else? And should I keep FBIOX? It's been pretty shitty lately after going going up at the beginning of the year. I'm a novice when it comes to all of this so please dumb down your advice for me lol.

[Amnorix]

So you have both the Fidelity and Vanguard total market funds. Not sure why, but whatever. Beyond that, you have a sector specific fund (biotech) and a few random stocks.

I personally like index mutual funds (or ETFs) unless you really plan to work the market -- track your stocks, figure out when it might be a good time to sell any specific stock, etc. Most of us aren't going to do that, which means that getting a wide range of stocks via a mutual fund or ETF makes sense. I would probably invest the money in a 500 index fund, or ETF.

I'm not much of a fan of sector funds unless you've done your homework on it. Your portfolio just doesn't seem large enough to dabble in quite that way.

Rain Man and I quite like investing in dividend yielding stocks. There are several you could consider. We both like MPW, which is a REIT (and therefore required to distribute most profits via dividends) which owns property rented by medical professionals (a field not likely to shrink in the near future, unlike malls). MPW is at the top of the range for its price over the last year, however, so it's not cheap at the moment or anything.

Hope this helps (or at least gives you some options to research and consider).

[-King-]

Originally Posted by Amnorix

So you have both the Fidelity and Vanguard total market funds. Not sure why, but whatever. Beyond that, you have a sector specific fund (biotech) and a few random stocks.

I personally like index mutual funds (or ETFs) unless you really plan to work the market -- track your stocks, figure out when it might be a good time to sell any specific stock, etc. Most of us aren't going to do that, which means that getting a wide range of stocks via a mutual fund or ETF makes sense. I would probably invest the money in a 500 index fund, or ETF.

I'm not much of a fan of sector funds unless you've done your homework on it. Your portfolio just doesn't seem large enough to dabble in quite that way.

Rain Man and I quite like investing in dividend yielding stocks. There are several you could consider. We both like MPW, which is a REIT (and therefore required to distribute most profits via dividends) which owns property rented by medical professionals (a field not likely to shrink in the near future, unlike malls). MPW is at the top of the range for its price over the last year, however, so it's not cheap at the moment or anything.

Hope this helps (or at least gives you some options to research and consider).

I have both Fidelity and the vanguard because my whole strategy is to just follow what I hear other smart people recommending. My sister recommended the fidelity find and I think I read about VTI on here lol. Like I said, I'm a novice so not too much of my own research or knowledge goes into it. I just see a recommendation, do about 10 minutes of reading up on it and that's basically it.

When I get some time today I'll try to do more than my usual 15 minutes of reading up on MPW. And as far as stocks vs funds, yeah I'm not interested at all in buying and selling and trying to time markets. Just want to put money in and see a steady return.

[TwistedChief]

Originally Posted by -King-

What's worth putting 2500 on right now? This is a my small portfolio right now should I just add on to one of these or buy something else? And should I keep FBIOX? It's been pretty shitty lately after going going up at the beginning of the year. I'm a novice when it comes to all of this so please dumb down your advice for me lol.

I personally never invest in anything but the most broad index funds. So if you have a longer-term horizon and don't have a great deal of conviction in any asset class/sector/stock in particular, my vote would be FSKAX or VTI.

[lewdog]

Originally Posted by -King-

What's worth putting 2500 on right now? This is a my small portfolio right now should I just add on to one of these or buy something else? And should I keep FBIOX? It's been pretty shitty lately after going going up at the beginning of the year. I'm a novice when it comes to all of this so please dumb down your advice for me lol.

That an "interesting" mix if that's your entire portfolio.

[RunKC]

Someone talk to me about owning vs renting. I’ve always been told my whole life that owning a home is “great bc you keep your equity!”

I’ve owned my house for almost 4 years and the “equity” I’m getting on it is shit compared to the money I’ve had to spend to fix shit in a brand new house when I moved in.

It’s to the point where I’m thinking **** it. I’m close to selling this damn house and renting so I won’t have to spend a lot of money every year paying to fix the goddamn thing.

Oh and then when I sell the goddamn thing the realtor gets 6%.

Owning feels like such a sham.

[Amnorix]

Originally Posted by -King-

I have both Fidelity and the vanguard because my whole strategy is to just follow what I hear other smart people recommending. My sister recommended the fidelity find and I think I read about VTI on here lol. Like I said, I'm a novice so not too much of my own research or knowledge goes into it. I just see a recommendation, do about 10 minutes of reading up on it and that's basically it.

When I get some time today I'll try to do more than my usual 15 minutes of reading up on MPW. And as far as stocks vs funds, yeah I'm not interested at all in buying and selling and trying to time markets. Just want to put money in and see a steady return.

Focusing on the second paragraph -- I'd stick to low very cost mutual funds, which generally means index funds, or ETFs which are a type of stock which tracks a group of stocks. It's basically an even lower cost way to invest in an index.

The upside to ETFs is no fees. The downside is that dividends are not automatically reinvested.

For now, I'd go 50/50 with your money -- a total market index (which you already have) and a 500 index, which tracks the largest companies. The two are not the same by any stretch.

This is assuming you have a long investing horizon, of course (in other words, that you're pretty young, say under 40) and can stomach the bad year or three that will inevitably happen and just ride it out.

[DaFace]

Originally Posted by RunKC

Someone talk to me about owning vs renting. I’ve always been told my whole life that owning a home is “great bc you keep your equity!”

I’ve owned my house for almost 4 years and the “equity” I’m getting on it is shit compared to the money I’ve had to spend to fix shit in a brand new house when I moved in.

It’s to the point where I’m thinking **** it. I’m close to selling this damn house and renting so I won’t have to spend a lot of money every year paying to fix the goddamn thing.

Oh and then when I sell the goddamn thing the realtor gets 6%.

Owning feels like such a sham.

You'll get a million opinions on it, and there really isn't a clear answer. I largely think it's a decision you should make based on your own life preferences rather than trying to figure out what the best decision is from a purely financial perspective. Do you like being able to customize your place to your preferences? Are you capable of making minor repairs and doing minor maintenance? Are you planning on staying in the same place for a long time? Are you comfortable saving up for the more major expenses? If so, ownership is probably the way to go. Would you rather not have to deal with repairs and maintenance? Are you OK with just living with a fairly generic space that you don't customize? Do you like the idea of being able to pick up and move easily? If so, renting is probably better.

If you want to try and figure out the best financial decision, you can play around with an online calculator to help you see where the differences are. For me, what it really comes down to is that your mortgage is a fixed amount, while rent will increase over time. So if you plan to stay in your place for 50 years, there's almost no question that buying will be the best option. But you're right that big maintenance items suck, and if you get hit with a bunch of them right after you buy, you might be behind where you'd be if you'd rented in the short term.

Side note:
I'm kind of ignoring the "equity" argument even though it's a valid one. I personally bought my place in 2009 when the government was giving out free money to buy a house, and I live in Denver where the housing market has been booming ever since. Nearly half of my net worth is due to my house, so I've been really fortunate. The problem is that another housing market collapse could eliminate all of it, and the situation in Denver this past decade is far from typical. Again, if you plan to stay in your place for years, the equity will absolutely be a benefit, but it doesn't work for everyone, and the benefit is pretty small if you're not in it for the long haul.

[Buehler445]

Originally Posted by RunKC

Someone talk to me about owning vs renting. I’ve always been told my whole life that owning a home is “great bc you keep your equity!”

I’ve owned my house for almost 4 years and the “equity” I’m getting on it is shit compared to the money I’ve had to spend to fix shit in a brand new house when I moved in.

It’s to the point where I’m thinking **** it. I’m close to selling this damn house and renting so I won’t have to spend a lot of money every year paying to fix the goddamn thing.

Oh and then when I sell the goddamn thing the realtor gets 6%.

Owning feels like such a sham.

I won’t tell you one way or the other but one thing I know for sure is if you rent, you’ll still be paying all the same maintenance costs, taxes, whatever. It will just be amortized over the whole year. You won’t write a separate check but you’re still paying for it.

FWIW if you have a loan on an amortization table (as opposed to straight line) you will not accumulate much equity early on. If you really are worried about the numbers make sure you read up on how amortization tables work.

[Rain Man]

Originally Posted by DaFace

...
Side note:
I'm kind of ignoring the "equity" argument even though it's a valid one. I personally bought my place in 2009 when the government was giving out free money to buy a house, and I live in Denver where the housing market has been booming ever since. Nearly half of my net worth is due to my house, so I've been really fortunate. The problem is that another housing market collapse could eliminate all of it, and the situation in Denver this past decade is far from typical. Again, if you plan to stay in your place for years, the equity will absolutely be a benefit, but it doesn't work for everyone, and the benefit is pretty small if you're not in it for the long haul.

I've mentioned something about this in the past, and while it seems silly I'm serious. The best financial advice that I would give a person just out of college would be to find a city that's growing and move there to start your career and buy a house as soon as possible. Buying a house in a growing market is like adding another wage earner in terms of increasing your net worth. You're paying a lot more for your home, which is rough, but you're leveraging the bankers' money in a way that gives you more wealth in the long run.

[-King-]

Originally Posted by Amnorix

Focusing on the second paragraph -- I'd stick to low very cost mutual funds, which generally means index funds, or ETFs which are a type of stock which tracks a group of stocks. It's basically an even lower cost way to invest in an index.

The upside to ETFs is no fees. The downside is that dividends are not automatically reinvested.

For now, I'd go 50/50 with your money -- a total market index (which you already have) and a 500 index, which tracks the largest companies. The two are not the same by any stretch.

This is assuming you have a long investing horizon, of course (in other words, that you're pretty young, say under 40) and can stomach the bad year or three that will inevitably happen and just ride it out.

I'm 27. So yeah I'm very long term.