Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Ask HN: I have 50k. How do I make it more without a startup?

news.ycombinator.com

Post reply on HN
Print view View original

11–20 of 51 posts

Re: Ask HN: I have 50k. How do I make it more without a startup?

#11

Post by greenyoda »

scorpioxy wrote: post #5
anotheryou wrote: post #3

Earlier quoted context omitted.

Same boat here. I'm really scared of a stock market crash.

Me too. Low fee index funds always seem to be the generic answer but after reading many articles and a couple of books about it, I am still not convinced. It seems to me that the rate of return has a lot to do with when you enter/exit the market and it is well known that you can't time the market so how is this different than any other gamble? There was also a popular article(NYT?), which I can't find the link to at…

"There was also a popular article(NYT?), which I can't find the link to at the moment, that showed me that only if you invest in the market for around 30 years or more, can you get a decent return. To me that makes sense if you want to leave your kids a little something after you're gone but not for your own lifetime."

What about investing for your own retirement? If you start investing when you begin your first job (usually in your 20s), and you expect to retire in your 60s and live into your 80s, that'll certainly give you at least a 30-year investment horizon.

Re: Ask HN: I have 50k. How do I make it more without a startup?

#13

Post by greenyoda »

aianus wrote: post #7
scorpioxy wrote: post #5

Earlier quoted context omitted.

Me too. Low fee index funds always seem to be the generic answer but after reading many articles and a couple of books about it, I am still not convinced. It seems to me that the rate of return has a lot to do with when you enter/exit the market and it is well known that you can't time the market so how is this different than any other gamble? There was also a popular article(NYT?), which I can't find the link to at…

> It seems to me that the rate of return has a lot to do with when you enter/exit the market Most people "enter the market" continuously by depositing a percentage of their pay each month of their career and "exit the market" slowly and continuously during retirement 40 years later. The booms and busts in between become irrelevant and you're left with a nice and high average rate of return.

In fact, even if you started investing in an S&P 500 index fund at the top of the market right before the big crash of 2007 (financial crisis), you'd still have a very decent return today.

Re: Ask HN: I have 50k. How do I make it more without a startup?

#15

Post by Kaizyn »

The only way to make it grow is through investing it. The more risk you take on, the higher it has the chance to grow. However, at the same time you have an increased risk that you'll lose your investment.

A money market account is safe and leaves your liquid assets in a state where you can get them easily. The downside is a poor rate of return.

Tax-exempt bonds (local, state or federal) are an attractive option provided that the rate of inflation doesn't exceed your rate of return or reduce it to effectively nil.

Another sensible option would be to pay off any debts you have. Your income is your best way to grow wealth, and every dollar you pay in interest is a dollar taken away from your future earnings. Even though this isn't as exciting an option as putting your money in the stock market, this might be your best bet longer-term.

If you have no debt, then the $50k would go a long way towards a down payment on a home - that way you can stop paying rent, which is another source of wasted earnings.

Re: Ask HN: I have 50k. How do I make it more without a startup?

#16

Post by zeynalov »

scorpioxy wrote: post #6

An unusual recommendation perhaps but recently I've been thinking of starting a small online business. Investing in that seems to offer the better risk to reward ratio. It also doesn't require a large capital to start. Consider that perhaps?

I don't have time to start a business, otherwise I wouldn't ask (see the title). I just look for ways to make it more with doing one time jobs (like investing, buying selling etc.) which I don't have to do the thing on a regular basis but one time and make it 51k after some time, for example.

Re: Ask HN: I have 50k. How do I make it more without a startup?

#17

Post by Kaizyn »

zeynalov wrote: post #14
gnarbarian wrote: post #2

Try an index fund.

is it a good idea if I don't have any experience on that field?

Index funds don't require you to manage your investment. Basically, there is a simple rule set the fund follows to diversify your portfolio and grow your money. Unlike managed funds, there aren't fees to the fund manager to eat into the profit/growth rate.

Re: Ask HN: I have 50k. How do I make it more without a startup?

#18

Post by Kaizyn »

scorpioxy wrote: post #5
anotheryou wrote: post #3

Earlier quoted context omitted.

Same boat here. I'm really scared of a stock market crash.

Me too. Low fee index funds always seem to be the generic answer but after reading many articles and a couple of books about it, I am still not convinced. It seems to me that the rate of return has a lot to do with when you enter/exit the market and it is well known that you can't time the market so how is this different than any other gamble? There was also a popular article(NYT?), which I can't find the link to at…

Consider the alternatives to the index fund: 1. Pick individual stocks and directly buy those. (A lot less diversification and a lot more hands-on management required.) 2. Hire a stock broker to invest for you. This is like #1 except now you are at the mercy of someone else whose interests you cannot be guaranteed to align with you. 3. Managed investment fund. Funds are diversified based on the discretion of the funds manager. Big fees are required for the privilege of having one pick stocks to buy and sell for the portfolio. 4. Real estate. Good investment but exceedingly high initial capital requirements. 5. Commodities - gold, silver, oil, pork bellies, etc. Less diversity of investment and specialist knowledge of the commodity are required.

Index funds are low cost to run, have a low capital requirement, require little to no active management, are highly-diversified, and get a fairly good rate of return. As a default option of 'do nothing and some money comes in', that's hard to compete with.

Post reply on HN