New To Investing Thread

[steve dave]

my guy has me put all windfalls in VTSAX (total stock market). A little more aggressive than the S&P.

I don't think DCA makes sense. If it's going to eventually all go into the stock market for a while, just put it all in.

DCA is normally a bad play. Dump it in.


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It's more conservative for sure.  I think it makes sense to avoid "timing the market" and it's what my dad (elite financial guy in my brain) told me i should do once so that's what i do.

What I don't think I'd do is dump it into a tax deferred account (401/IRA) because if I just got some fat rough ridin' stacks all of a sudden I'd want it to be a bit more liquid.  But that's just me.

Just read this the other day, timely

Dollar cost averaging will underperform lump sum investing for most asset classes most of the time.

........

When deciding between dollar cost averaging vs lump sum, it is almost always better to lump sum (invest it now), even on a risk-adjusted basis.

https://ofdollarsanddata.com/dollar-cost-averaging-vs-lump-sum/

[DQ12]

my guy has me put all windfalls in VTSAX (total stock market). A little more aggressive than the S&P.

I don't think DCA makes sense. If it's going to eventually all go into the stock market for a while, just put it all in.

DCA is normally a bad play. Dump it in.


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It's more conservative for sure.  I think it makes sense to avoid "timing the market" and it's what my dad (elite financial guy in my brain) told me i should do once so that's what i do.

What I don't think I'd do is dump it into a tax deferred account (401/IRA) because if I just got some fat rough ridin' stacks all of a sudden I'd want it to be a bit more liquid.  But that's just me.

Just read this the other day, timely

Dollar cost averaging will underperform lump sum investing for most asset classes most of the time.

........

When deciding between dollar cost averaging vs lump sum, it is almost always better to lump sum (invest it now), even on a risk-adjusted basis.

https://ofdollarsanddata.com/dollar-cost-averaging-vs-lump-sum/

i feel like you're discounting the advice my dad (who i already mentioned is a very elite investment mind) gave me a long time ago that i may be misremembering.

[steve dave]

DCA was well known as a BITB strategy by old people before they had, like, data and crap. I was also given that advice.

[kim carnes]

It is almost always better, almost

[michigancat]

It is almost always better, almost

IMO if you know when it lump isn't better you should just dump it all in at the best possible time instead of DCA (and get out at the right times too).

So in a world you don't know for sure you should always lump sum.

[steve dave]

It is almost always better, almost

IMO if you know when it lump isn't better you should just dump it all in at the best possible time instead of DCA (and get out at the right times too).

So in a world you don't know for sure you should always lump sum.

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[DQ12]

I'll never stop DCA'ing no matter what you guys say. 

[sys]

Someone asked me what I would do with a lump sum of cash right now... Would you half it with ibonds and S and P?

you wouldn't be able to put half into ibonds, because you're limited to 10k/year.


personally, i would put half or something like that into bonds.  big question would be the duration.  irl, i have a decent chunk of money in just stupid depreciating cash because i haven't decided what to do with it/been to lazy to move it anywhere.

[steve dave]

Someone asked me what I would do with a lump sum of cash right now... Would you half it with ibonds and S and P?

you wouldn't be able to put half into ibonds, because you're limited to 10k/year.


personally, i would put half or something like that into bonds.  big question would be the duration.  irl, i have a decent chunk of money in just stupid depreciating cash because i haven't decided what to do with it/been to lazy to move it anywhere.

Just say you’re DCA’ing. Smash that like and follow button for more finance hacks like this.


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[Brock Landers]

I'll never stop DCA'ing no matter what you guys say. 

Ain't no party like a DCA party
cuz the DCA party don't stop

[IPA4Me]

Monthly. DCA.

Lump sum. Depends on your timeline and market thoughts.

Personally, I'm DCA with my 401K and day trading my rollover. I'm only holding QQQ and SPY shorts more than overnight as I don't believe we've hit the market bottom.


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[steve dave]

Hello Finance goEMAW moguls. I am wondering if you guys have any resources/recommendations to maybe get into the markets. I am very new to the landscape. Wondering if there were some books or resources. I now have some dollars. Trying to enter at the ground level maybe build a little portfolio.

Any tips would be greatly appreciated.

Good mindset book, less about strategies of what to do with your money but more about understanding what will make you happy and why when it comes to money:

https://www.amazon.com/Psychology-Money-Timeless-lessons-happiness-ebook/dp/B084HJSJJ2/ref=sr_1_1?gclid=Cj0KCQiAx6ugBhCcARIsAGNmMbhuR-ljHAJ4bi7Y7q7HIVBPc6_7TW0ehaZ4t7U5Xqeg9qCR9-sNjwQaAsi2EALw_wcB&hvadid=241638696189&hvdev=c&hvlocphy=9024532&hvnetw=g&hvqmt=e&hvrand=455747722884979094&hvtargid=kwd-816731825&hydadcr=21903_10171041&keywords=the+psychology+of+money&qid=1678467978&sr=8-1

Can probably just read the cover and get the idea:

https://www.amazon.com/Just-Keep-Buying-Proven-wealth-ebook/dp/B09FYHZXBN/ref=sr_1_1?gclid=Cj0KCQiAx6ugBhCcARIsAGNmMbj2qf4zRAvIsH_BjouF4myVATdg0mWDtTmJD31vIXwSEAQG59PEOg4aAr4eEALw_wcB&hvadid=570460113000&hvdev=c&hvlocphy=9024532&hvnetw=g&hvqmt=e&hvrand=3750560504436305829&hvtargid=kwd-1431082822979&hydadcr=20138_13319362&keywords=just+keep+buying&qid=1678468432&sr=8-1

Someone recommended Ben to me on here a long time ago and he is very good. Works at the same firm as the author above so probably getting some feedback loop here. His "Animal Spirits" podcast is a good listen too and comes out every Wednesday plus weekly shows with guests that I listen to depending on if the topic interests me.

https://awealthofcommonsense.com/

Do you have an employer sponsored retirement plan? If so what is it and how are you contributing? IRA? If so same questions? Pension, etc.? Already have a brokerage account? What are your goals? What is your risk appetite? Like, how risky you wanting to get here? I've got some really pure ideas for how to lose money SUPER fast so need to know this before I give you actual NOT financial advice.

[catastrophe]

For people interested in getting into the market but don't have the time to navigate a bunch of different options (or just hate dealing with that kind of stuff), I've recommended a robo investor like Betterment. It charges a (very low) percentage fee so it's definitely not going to be the most cost effective option, but it's engaging and the tools are cool. Even though I now have most of my money elsewhere, I have the accounts balances linked to Betterment and use it all the time to guestimate how I'll be looking 5, 10, 20 years down the road.

After you get a little more comfortable (or if you want to just skip to the "intermediate" low-risk investing) Vanguard is probably the gold standard buying VTI or VOO.

That said, like SD is getting at make sure you understand all the tax-advantaged options available. HSA is probably the sneakiest one if you have that through work.

[michigancat]

our guy greg just needs to put as much as he can into an S&P 500 or total stock market index fund in an employee retirement plan or Roth IRA.

Betterment is unnecessary.

[bucket]

our guy greg just needs to put as much as he can into an S&P 500 or total stock market index fund in an employee retirement plan or Roth IRA.

Betterment is unnecessary.

My money guy says ETF’s are better for tax purposes than index funds. So jot that down and invest in ETF’s, Greg.

[steve dave]

our guy greg just needs to put as much as he can into an S&P 500 or total stock market index fund in an employee retirement plan or Roth IRA.

Betterment is unnecessary.

My money guy says ETF’s are better for tax purposes than index funds. So jot that down and invest in ETF’s, Greg.

I’ve got some important news for your money guy about what index fund means and/or what an ETF is…..


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[wetwillie]

[bucket]

Damnit, Ethan! 

[catastrophe]

our guy greg just needs to put as much as he can into an S&P 500 or total stock market index fund in an employee retirement plan or Roth IRA.

Betterment is unnecessary.

Betterment is unnecessary UNLESS you’re interested in some easy to use financial projection/retirement estimate tools on top of just growing a nest egg.

The tax loss harvesting in Betterment has personally saved me more than I’ve paid in fees, but I will say the more conservative skew of its investment advice has made me miss out on some upside I would have captured by just buying S&P 500.

If I had to do it all again I’d probably use Vanguard for almost everything but just put like $500 in Betterment to use the advice tools.

And I wouldn’t have bought any crypto. WOOF I hope that bounces back one of these decades.

[michigancat]

our guy greg just needs to put as much as he can into an S&P 500 or total stock market index fund in an employee retirement plan or Roth IRA.

Betterment is unnecessary.

Betterment is unnecessary UNLESS you’re interested in some easy to use financial projection/retirement estimate tools on top of just growing a nest egg.

The tax loss harvesting in Betterment has personally saved me more than I’ve paid in fees, but I will say the more conservative skew of its investment advice has made me miss out on some upside I would have captured by just buying S&P 500.

If I had to do it all again I’d probably use Vanguard for almost everything but just put like $500 in Betterment to use the advice tools.

And I wouldn’t have bought any crypto. WOOF I hope that bounces back one of these decades.

That may be true for you our guy Greg definitely does not need to worry about tax loss harvesting or even more diversification than an index fund provides. He needs to throw money into retirement accounts as soon at possible

[sys]

hit a few limit orders today, so my pile of stonks gets bigger even as my pile of money i could sell them for gets smaller.

[steve dave]

hit a few limit orders today, so my pile of stonks gets bigger even as my pile of money i could sell them for gets smaller.

oh man, I never do limit orders. when I failingly try to catch a falling knife (OFTEN) I want to be fully aware it's falling and be in the moment reaching out to grab it. no robot is taking that away from me.

[sys]

i like to put my trust in the lord.  if he wants me to own more stonks, he'll bankrupt a vc bank or whatever is his divine will.

[steve dave]

I put in tons of stop sells. The Lord will for sure try to eff me on these deals that are otherwise guaranteed to be winners. Joke's on his old ass though, even The Lord can't outwit a robot.

[KITNfury]

Is this the right thread to ask how to roll multiple 401ks into 1?