Question about the stock market

[Anonymous]

OP - I think your interpretation is correct and that your 403b is not doing that well. My parents helped me open a Fidelity Roth IRA for me when I turned 18 and I have been putting in the max amount for 10 years now and actively trading various growth stocks within it. I have contributed $59K to it over this time and it has a current balance of $617K.

I also have a 403b that I’ve been contributing to for six years now, post-graduation, and have been maxing that out as well. With matching I have contributed $150K total over 6 years but have a current balance of $381K. Low cost high growth index mutual funds.

Pretty easy to have $1M or so already saved for retirement before you’re 30 these days, so maybe you should push back a little harder on your salesperson/advisor and start managing yourself.

[Anonymous]

Anonymous wrote:Remember that for retirement people usually invest in a 'balanced' or 'growth' portfolio-

For a 'growth' fund about 80% is in equities (a portion of this in international), 20% bonds - all for diversification purposes... therefore it wont have increased as much as sp500 (which is 100% usa stock) of course.

Ok thanks for that.

[Anonymous]

Anonymous wrote:OP - I think your interpretation is correct and that your 403b is not doing that well. My parents helped me open a Fidelity Roth IRA for me when I turned 18 and I have been putting in the max amount for 10 years now and actively trading various growth stocks within it. I have contributed $59K to it over this time and it has a current balance of $617K.

I also have a 403b that I’ve been contributing to for six years now, post-graduation, and have been maxing that out as well. With matching I have contributed $150K total over 6 years but have a current balance of $381K. Low cost high growth index mutual funds.

Pretty easy to have $1M or so already saved for retirement before you’re 30 these days, so maybe you should push back a little harder on your salesperson/advisor and start managing yourself.

I’m just curious, do you work for a school district? What school district is matching your 403B contributions? Certainly not in the DMV area? Do you not contribute to a pension?

[Anonymous]

Anonymous wrote:OP - I think your interpretation is correct and that your 403b is not doing that well. My parents helped me open a Fidelity Roth IRA for me when I turned 18 and I have been putting in the max amount for 10 years now and actively trading various growth stocks within it. I have contributed $59K to it over this time and it has a current balance of $617K.

I also have a 403b that I’ve been contributing to for six years now, post-graduation, and have been maxing that out as well. With matching I have contributed $150K total over 6 years but have a current balance of $381K. Low cost high growth index mutual funds.

Pretty easy to have $1M or so already saved for retirement before you’re 30 these days, so maybe you should push back a little harder on your salesperson/advisor and start managing yourself.

Those returns from active trading are not typical or easy.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP - I think your interpretation is correct and that your 403b is not doing that well. My parents helped me open a Fidelity Roth IRA for me when I turned 18 and I have been putting in the max amount for 10 years now and actively trading various growth stocks within it. I have contributed $59K to it over this time and it has a current balance of $617K.

I also have a 403b that I’ve been contributing to for six years now, post-graduation, and have been maxing that out as well. With matching I have contributed $150K total over 6 years but have a current balance of $381K. Low cost high growth index mutual funds.

Pretty easy to have $1M or so already saved for retirement before you’re 30 these days, so maybe you should push back a little harder on your salesperson/advisor and start managing yourself.

I’m just curious, do you work for a school district? What school district is matching your 403B contributions? Certainly not in the DMV area? Do you not contribute to a pension?

I work for a 501(c)(3) nonprofit company. There is no pension, just a parallel employer contribution to a non-contributory account. Like a match…but not really. Just a fixed percentage of income that vests. Managed by Empower. Pretty decent selection of funds, mostly Vanguard.

[Anonymous]

Returns are relative to a benchmark, and cannot be evaluated in the abstract. A returns of 21% investing in U.S. treasuries would be phenomenal (and improbable), but would be poor relative to having invested in certain popular stocks or focused ETFs over specific periods of time. 21% in itself is neither good nor bad; you have to ask "compared to what"? And, you're also second guessing the investment - had you invested in X, your returns would have been Y; but you invested instead in A and your returns are B - apples and oranges.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP - I think your interpretation is correct and that your 403b is not doing that well. My parents helped me open a Fidelity Roth IRA for me when I turned 18 and I have been putting in the max amount for 10 years now and actively trading various growth stocks within it. I have contributed $59K to it over this time and it has a current balance of $617K.

I also have a 403b that I’ve been contributing to for six years now, post-graduation, and have been maxing that out as well. With matching I have contributed $150K total over 6 years but have a current balance of $381K. Low cost high growth index mutual funds.

Pretty easy to have $1M or so already saved for retirement before you’re 30 these days, so maybe you should push back a little harder on your salesperson/advisor and start managing yourself.

Those returns from active trading are not typical or easy.

+1. Crazy statement or humble brag…..

[Anonymous]

Active trading only beats the market for people who ignore their losses.

21% YTD isn’t terrible.. the s&p went up 26ish% YTD and a lot of those gains were in the last several days, so it may even be closer.

Its unlikely that a mid-career teacher would be 100% allocated to stocks no matter what, so even with 5% bonds, you’d underperform the S&P.

That said, Vanguard is the best program out there. There’s absolutely no reason to not roll over to them.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP - I think your interpretation is correct and that your 403b is not doing that well. My parents helped me open a Fidelity Roth IRA for me when I turned 18 and I have been putting in the max amount for 10 years now and actively trading various growth stocks within it. I have contributed $59K to it over this time and it has a current balance of $617K.

I also have a 403b that I’ve been contributing to for six years now, post-graduation, and have been maxing that out as well. With matching I have contributed $150K total over 6 years but have a current balance of $381K. Low cost high growth index mutual funds.

Pretty easy to have $1M or so already saved for retirement before you’re 30 these days, so maybe you should push back a little harder on your salesperson/advisor and start managing yourself.

I’m just curious, do you work for a school district? What school district is matching your 403B contributions? Certainly not in the DMV area? Do you not contribute to a pension?

I work for a 501(c)(3) nonprofit company. There is no pension, just a parallel employer contribution to a non-contributory account. Like a match…but not really. Just a fixed percentage of income that vests. Managed by Empower. Pretty decent selection of funds, mostly Vanguard.

OK, I thought so. (OP here.) From what I can tell, the 403b situation for teachers/school districts is dreadful; for non-profits it seems to be better.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Returns are evaluated against a benchmark. If a large-cap growth and value fund, the relevant index might be something like the S&P 500.

It's more complicated than that, though, because you have to also consider volatility (risk). Sometimes funds with outsize returns achieve those by taking on more risk. Some investors are ok with that, others are oblivious.

Also be sure to compare returns after expenses. Vanguard funds have extremely low expenses compared to most others, which helps improve total return. See https://www.investor.gov/introduction-investing/investing-basics/glossary/mutual-fund-fees-and-expenses

yes, that part I understand. 403b plans unfortunately are lousy with mostly high fee options, and Equitable's offerings are the worst offenders (charging something like 2% I think) which is why my colleague wants to change.

But I was specifically trying to put her "advisor's" comment into context for her. I don't think 21% growth this year is anything much to brag about, since I think just an index fund would have returned more than that over the past year.

So you don't even understand the most basic of basics regarding the stock market yet begrudge financial advisors' earning a living by helping others invest and navigate this field? Wow, the anti-financial-advisor propaganda is really working. I'm not a financial advisor and have no stake in this whatsoever - and I actually DIY my investing because I do know about the subject - but I'm constantly amazed at the irrational hate that financial advisors receive.

Whatever. There fiduciary FA and there are “financial advisers” and then there are cultures harvesting fat fees from a captive audience.