Anonymous wrote:

Anonymous wrote:We are mid 30s, came into some cash this year (low six figures), and have done a similar approach… a little here, a little there. For us that’s our brokerage, kids 529s, and ibonds. We have spread out the brokerage purchases over time, every couple weeks. The approach gives me the most piece of mind.

I am curious - you said you are maxing 529s, what does maxing mean? There is no limit, but there is a cap to the tax benefit depending on your state.

That approach makes sense to me - I hope to do something similar.
We are in VA so doing $8k per kid per year ($16k/year), for the “max” VA state benefit of $4k/account/person. Right now the 2 year old has $27k and the 9 month old has $11k in their accounts. We intend to keep this approach for the years to come so even though the #s aren’t big yet, I don’t necessarily want to put more in those accounts now.

What are you doing for your 529s?

We are only doing $250/month per child - both are a year older then yours - but added 15k each from the cash I mentioned to help front load. I am concerned about the college landscape changing before they go, but also recognize that significant reform is h likely. So we want to be prepared but may contribute some from our brokerage or cash flow at the time. We are in MD so minimal tax break.

Anonymous wrote:We are mid 30s, came into some cash this year (low six figures), and have done a similar approach… a little here, a little there. For us that’s our brokerage, kids 529s, and ibonds. We have spread out the brokerage purchases over time, every couple weeks. The approach gives me the most piece of mind.

I am curious - you said you are maxing 529s, what does maxing mean? There is no limit, but there is a cap to the tax benefit depending on your state.

That approach makes sense to me - I hope to do something similar.
We are in VA so doing $8k per kid per year ($16k/year), for the “max” VA state benefit of $4k/account/person. Right now the 2 year old has $27k and the 9 month old has $11k in their accounts. We intend to keep this approach for the years to come so even though the #s aren’t big yet, I don’t necessarily want to put more in those accounts now.

What are you doing for your 529s?

We are mid 30s, came into some cash this year (low six figures), and have done a similar approach… a little here, a little there. For us that’s our brokerage, kids 529s, and ibonds. We have spread out the brokerage purchases over time, every couple weeks. The approach gives me the most piece of mind.

I am curious - you said you are maxing 529s, what does maxing mean? There is no limit, but there is a cap to the tax benefit depending on your state.

Anonymous wrote:

Anonymous wrote:Looong way to go before this market bottoms. How much you want to lose holding voo? Ibonds for now.

Nobody can predict the stock market. If you could, you would be rich and not posting on dcum. US small is down 35% from peak. Likely a good deal if you are a long term investor.

It's interesting that nobody would be skeptical about investing in stocks a year ago when valuations we're very high, and obviously not a good deal in hindsight.

I sold out of all my equities in November 2021. The overvaluation of the market was as plain as day. I’m sitting on $18M in cash that will be put back into growth stocks when the S&P 500 dips below 3200. Once the market pushes back up to 4800 (ETA 2028), I’ll be sitting pretty with a cool $27M. Plus, of course, I’ll be DCAing new money in at low prices all along the way. My divine brilliance knows no earthly bounds, of this we can be absolutely sure.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yolo on VOO. Worst case the market looses another 20 percent and you are out 4K….is that really the end of the world?

Hmm. Okay. I am thinking to split it up, and do $10k VOO and $10k I bonds.

Sounds lame

What’s your cool recommendation the ? 😎

Anonymous wrote:

Anonymous wrote:Yolo on VOO. Worst case the market looses another 20 percent and you are out 4K….is that really the end of the world?

Hmm. Okay. I am thinking to split it up, and do $10k VOO and $10k I bonds.

Sounds lame

Anonymous wrote:Yolo on VOO. Worst case the market looses another 20 percent and you are out 4K….is that really the end of the world?

Hmm. Okay. I am thinking to split it up, and do $10k VOO and $10k I bonds.

Yolo on VOO. Worst case the market looses another 20 percent and you are out 4K….is that really the end of the world?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What is your asset allocation (how much of your portfolio do you want to be in bonds?) This is dependent on when you plan to retire and your risk tolerance. Come up with something you’re comfortable with for the long term. Personally, I’m 20% in bonds. Once you have your AA, invest accordingly. As soon as your tech stock vests, sell it and reinvest accordingly. You don’t want to hold 250k at a place where you work. Too risky.

That is a good way for me to think about it. Right now we are very cash heavy for how young we are, but I get a sense of comfort from having so much cash on hand and accessible if we ever need it.
We do plan to sell the stock and reinvest in VOO, but ideally 1 year after it vests so we move to the long term cap gains tax bracket for the stock instead of ordinary income.

You are taxed on stock on the date it vests as ordinary income. My employer actually sells shares to pay for the tax. So holding the shares for a year beyond vesting doesn’t do you any good. Might as well invest in VOO or whatever and hold it there for a year or more.

Wow, I had no idea about that - I thought I was taxed once I sold, not when it vested!! Good to know, I will definitely sell immediately and then move it into VOO at that point in time.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Trying to figure out what to do with $20k I’ve saved up. Some context separate from the $20k fund:

- Currently have $20k in I Bonds purchased last year
- $60k cash cushion emergency fund saved
- $50k in after tax brokerage accounts
- will come into about $250k of tech stock in the next few years as it vests
- already max out 401k and 529 accounts

Any thoughts on if I should stick with my initial I Bond plan with these high rates, or use the low VOO prices to get more VOO at a “discount?”

TIA wise ones of DCUM!

Depending on your age, risk tolerance and investment horizon:
High risk: 50/50 - TQQQ and SPXL (young, high risk tolerance, very long term investment horizon)
Mderate risk: 50/50 - QQQ/VOO
Low risk: 50/50 - VOO/iBonds
zero risk: 100% iBonds

For options 1 and 2, I'd spread the investment over the next 5-6 months.. Say second business day of each month, 2K per month per instrument.

Thank you - this is very helpful. I need to read up on TQQQ and SPXL. We are late 20s, and no immediate plans for the money so likely long term investment horizon. Some talk of getting a second property as an investment, but not sure if that makes sense or better to keep money in the market.

TQQQ and SPXL represent 3X QQQ and SPY respectively, compounded daily. You could win big or lose big. TQQQ has lost money relative to the others (QQQ and VOO) over the short and medium term. However, at 5 years, it has returned 102% (almost the same as QQQ) while SPXL has returned 48% (almost the same as VOO). However, over its life (since Feb 2010), TQQQ has returned 4,300%, SPXL 1241% while QQQ and VOO have returned 515% and 303% respectively. Of course, TQQQ will lose a LOT during bad times (76%ytd). The high return i quoted are despite this 76% ytd loss.
No harm in allocating a small amount of money to one or both instruments and based on your income, 20K IS a small amount of money and you can afford to take that risk at your age.

Anonymous wrote:Do not buy tqqq or any levered etf. They are not for holding long term

I buy a bit of TQQQ every month, but admit that it is mainly for day trading. Not a good buy and hold unless we have a bizarro sustained tech run up like in the pandemic.

Do not buy tqqq or any levered etf. They are not for holding long term

Anonymous wrote:

Anonymous wrote:What is your asset allocation (how much of your portfolio do you want to be in bonds?) This is dependent on when you plan to retire and your risk tolerance. Come up with something you’re comfortable with for the long term. Personally, I’m 20% in bonds. Once you have your AA, invest accordingly. As soon as your tech stock vests, sell it and reinvest accordingly. You don’t want to hold 250k at a place where you work. Too risky.

That is a good way for me to think about it. Right now we are very cash heavy for how young we are, but I get a sense of comfort from having so much cash on hand and accessible if we ever need it.
We do plan to sell the stock and reinvest in VOO, but ideally 1 year after it vests so we move to the long term cap gains tax bracket for the stock instead of ordinary income.

You are taxed on stock on the date it vests as ordinary income. My employer actually sells shares to pay for the tax. So holding the shares for a year beyond vesting doesn’t do you any good. Might as well invest in VOO or whatever and hold it there for a year or more.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Trying to figure out what to do with $20k I’ve saved up. Some context separate from the $20k fund:

- Currently have $20k in I Bonds purchased last year
- $60k cash cushion emergency fund saved
- $50k in after tax brokerage accounts
- will come into about $250k of tech stock in the next few years as it vests
- already max out 401k and 529 accounts

Any thoughts on if I should stick with my initial I Bond plan with these high rates, or use the low VOO prices to get more VOO at a “discount?”

TIA wise ones of DCUM!

Depending on your age, risk tolerance and investment horizon:
High risk: 50/50 - TQQQ and SPXL (young, high risk tolerance, very long term investment horizon)
Mderate risk: 50/50 - QQQ/VOO
Low risk: 50/50 - VOO/iBonds
zero risk: 100% iBonds

For options 1 and 2, I'd spread the investment over the next 5-6 months.. Say second business day of each month, 2K per month per instrument.

Thank you - this is very helpful. I need to read up on TQQQ and SPXL. We are late 20s, and no immediate plans for the money so likely long term investment horizon. Some talk of getting a second property as an investment, but not sure if that makes sense or better to keep money in the market.

Late 20s?, I would just DCA into VTSAX. When you are in late 30s and early 40s then worry about the bonds depending on planned retirement age. A LOT can change for you. Also, live up a little, what worked for us is we save fixed % of gross salary (30%-40% starting later 30's , closer t0 20% when we were younger) and then enjoy the rest

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Trying to figure out what to do with $20k I’ve saved up. Some context separate from the $20k fund:

- Currently have $20k in I Bonds purchased last year
- $60k cash cushion emergency fund saved
- $50k in after tax brokerage accounts
- will come into about $250k of tech stock in the next few years as it vests
- already max out 401k and 529 accounts

Any thoughts on if I should stick with my initial I Bond plan with these high rates, or use the low VOO prices to get more VOO at a “discount?”

TIA wise ones of DCUM!

Depending on your age, risk tolerance and investment horizon:
High risk: 50/50 - TQQQ and SPXL (young, high risk tolerance, very long term investment horizon)
Mderate risk: 50/50 - QQQ/VOO
Low risk: 50/50 - VOO/iBonds
zero risk: 100% iBonds

For options 1 and 2, I'd spread the investment over the next 5-6 months.. Say second business day of each month, 2K per month per instrument.

Thank you - this is very helpful. I need to read up on TQQQ and SPXL. We are late 20s, and no immediate plans for the money so likely long term investment horizon. Some talk of getting a second property as an investment, but not sure if that makes sense or better to keep money in the market.

Don't waste your time reading about SPXL and TQQQ, as these are leveraged products and not in the realm of being a good idea. Try to figure out how much risk (bonds) you are willing to take and then do a little research on small caps and international stocks. I used to have a complicated portfolio and have learned over the years that it's best to keep things as simple as possible. Target retirement funds and Lifestrategy funds by Vanguard are a great option for most people.