I've been keeping mine under my mattress, definitely going to give this a try - Thanks for the tip!
Retirement Targets
- Thread starter yowza
- Start date
Mattress money is the best, baby.
Keep it liquid, out of the banking system, and untraceable
No better short term, highly liquid option in today's marketplace
I use MaxMyInterest.com which provides a competitive rate HYSA among online banks for full liquidity and FDIC protection. Currently yielding nearly 5.4%
It may never be an issue…wouldn’t be if you never sold at a loss…but I would like to point out that if you are buying VTI or similar in both your retirement accounts and the taxable account, you’re in a wash sale situation if you opt to sell taxable account shares for a loss. Probably only a few shares though (whatever you bought in the same account in the 61 day window around that sale).
They are great. Brian is a CPA and financial advisor, which seems ideal. Kind of eliminates the concern I have about wasting money on someone who doesn’t know what they’re doing (which candidly seems to be a majority of financial advisors).
Speaking of, working with/choosing an advisor is so hard. When you don’t know what you are doing, you only find the ones who are desperate for clients (or get assigned the new guy), and then by the time you figure things out, you’re mad that you’ve made all these dumb decisions and don’t want to deal with an advisor anymore. That’s my experience anyway. The first stock recommendation I ever got was muni bonds when I was like 26 and had very little money. Oy…what a stupid recommendation…
So, I’ve just opened a vanguard account. I have been seeing varying investing strategies on here since I posted. Are ETFs a good option?
bitcoin - i have no interest in holding something with exponential decay in any amount beyond my monthly bills.
Mega Back Door Roth if your company offers it.
Gotta be a decently high earner to even start considering it though.
Yes. Vanguard funds are low cost.
I have VTI (total market), VOO (S&P 500) as core investments in my taxable account. QQQ has also been a nice earner
I was running numbers today. To illustrate the power of the time value of money
Since 2017 my accounts are up 442%. One fund I bought around 2000 is up roughly 900%
I had nothing to do with those returns other than committing to investing and leaving it alone.
It doesn't need to be complex. Commit to investing. Leave it. Don't look at the balance when the market takes a dump (and it will).
(Not an investment professional!)
When the market takes a dump, it generally the best time to buy some more. It works.
100% correct. Keeping some "dry powder" around isn't an awful idea.
If you have a long horizon buying those dips and corrections can pay off.
Just don't get jittery. Don't sell and take the loss if you don't need the bread. This is especially true if you are in a broad market ETF. The market will come back.
That account I referred to above is actually a 10x return now. At one point it was down almost 50%. If I sold I'd have lost out.
I may think differently in a few years, but I think just saving somewhere is the most important piece. Each time I think I have it all figured out, something else is brought up that changes my mind. ASA pre-retirement discounts, future tax changes, irmaa, roth conversions, RMD's, age taking social security for both myself and wife, when my wife and I will die, where I'll live and the state income taxes, etc.
About 30% of my retirement money is in Roth vehicles. I've been told this is genius and I've also been told that it's 100% idiotic. I don't believe "Never" is the right answer. The people that say never don't know my situation and can't predict the future.
About 30% of my retirement money is in Roth vehicles. I've been told this is genius and I've also been told that it's 100% idiotic. I don't believe "Never" is the right answer. The people that say never don't know my situation and can't predict the future.
Generally you have to have maxed out your regular 401k ($23K) before you can utilize the after tax option for a mega back door. So yes, a higher earner.
If you’re still in the range to contribute to a Roth that’s much more straightforward.
I'm 32, wife is 30. One kid (4) and second on the way this fall. I've not spent much time at all to be extremely knowledgeable in the investing world, so we've kept it simple with some input from an advisor who manages a few accounts for us (roth IRAs and some old employer 401k/403b accounts that we rolled over into traditional IRAs).
Our income situation obviously helps, but the biggest thing for us was starting straight out of college contributing really significantly to employer retirement plans. Like every college kid, I was dead broke when I graduated and started my first job. I started contributing 10% to 401k immediately and but when you start out like that, you never miss the money. Then every raise over the years I would up the contribution percentage by half of the raise (4% raise, increase contribution by 2%) until I was maxed out. Again, never missed the money because I never saw that "new" salary. I just saw the small increase that ulimately came through. Probably "better" ways to do it, but for simplicity sake it was a great way to get a jump start on things.
- No debts outside of mortgage
- Both maxed out 401k contributions (all Roth now)
- Contribute full state tax deductible amount to 529 plan for kid
- Contributed max to Roth IRA annually until we passed the income limits
- Next up is sorting out what to do around backdoor/mega backdoor roth
Our income situation obviously helps, but the biggest thing for us was starting straight out of college contributing really significantly to employer retirement plans. Like every college kid, I was dead broke when I graduated and started my first job. I started contributing 10% to 401k immediately and but when you start out like that, you never miss the money. Then every raise over the years I would up the contribution percentage by half of the raise (4% raise, increase contribution by 2%) until I was maxed out. Again, never missed the money because I never saw that "new" salary. I just saw the small increase that ulimately came through. Probably "better" ways to do it, but for simplicity sake it was a great way to get a jump start on things.
Just a reminder, you and your wife can contribute individually to 529s.
Indeed. Also, the new 529 to Roth IRA roll-over rules make the idea of a 529 more palatable as well. Who knows what college will cost in 15 years, or if our kids will even go to college, but if there is money left in those accounts it will feel really good to be able to roll up to $35k into Roth-IRA for them and kick start their own savings journey.
A hybrid Roth-Traditional strategy could help with taxes in the long run. It can also be a plan for future inheritance distributions.
I'm roughly 52% traditional. But the wildcard will always be future tax brackets.
We have an advisor through work. He was concerned about my aggressive style. 100% equities. After explaining that I'm buying shares on the dip and that I have a high risk tolerance he was cool with it.
Same with the hybrid traditional-roth. Who knows what things will look like. The important thing is committing to investing. Staying the course.
Just my humble opinion. It's OK to take some risks, but make sure to do something
