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Ask HN: I've saved up $80k USD. What should I do with it?

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Re: Ask HN: I've saved up $80k USD. What should I do with it?

#71

Post by jweather »

glofish wrote: post #33
sneak wrote: post #10

Short answer: Dump it all in VFIAX and ignore it for about 30 years. Alternately, wait for the housing market freefall that is scheduled to hit about 180 days from now, and buy a foreclosure or two. EDIT: Cosigning the above recommendation about maxing out a Roth IRA each and every year as well, and of course maxxing out any company-matched 401(k) options.

overall awfully misguided advice. when you buy foreclosure you are buying all responsibilities for the home - past debts, mortgages, liens, future taxes, repairs etc - in addition you are betting that future appreciation will all pay off - not guaranteed at all. Homes are illiquid and a lot of trouble. no one should just buy a foreclosed home without thorough preparation

Buying a foreclosure is the same as any other home purchase -- get an inspection and title search to know what you're getting into. You're not "buying all responsibilities" any more than you are when purchasing a home the "normal" way.

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#72

Post by slantaclaus »

WJW wrote: post #21

First off: Well done saving up! If you are paralysed about (getting started with) investing, I can recommend the books "A random walk down Wall Street" and the (very thick but well worth it) "The intelligent investor". Especially the last one opened my eyes a lot about how to approach investing. I have the revised edition from 2006, though the original publication was in 1949. The 2006 edition has a section after eac…

One Up On Wall Street, Peter Lynch

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#73

Post by generalpass »

Ohl7eeX8 wrote: post #59
generalpass wrote: post #16

Whatever you do, don't follow the advice of posters here at HN. If even one of them has valid advice, it is coincidence.

This is basically liar paradox [1] :) If it's true, then they shouldn't listen to you. But then they can follow advice of anyone, including yours. [1] https://en.wikipedia.org/wiki/Liar_paradox

This sentence is false.

"This sentence" = "This sentence is false."

[This sentence is false] is false.

"This sentence" = "This sentence is false is false."

[This sentence is false is false] is false.

"This sentence" = "This sentence is false is false is false."

[This sentence is false is false is false] is false.

...

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#74

Post by basch »

forgingahead wrote: post #46

I would actually keep holding it in cash -- that is maybe 2 years of emergency funds if you are married/have a family? Keep it in cash, pretend you don't have it (create a separate account that is just this sitting there), continue earning and saving. Anything extra you earn after this 80k base you can invest (simple things like index funds, dollar cost average in slowly).

You could put 80K in the stock market, and if you have an emergency borrow against it at 2%.

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#75

Post by basch »

tjansen wrote: post #56

Right now is a very risky time to invest. It could be that it turns out to be a good time, because stocks are about 20% below the all-time high. But there could also be a second crash, when investors realize the real impact of the economic crisis caused by Covid-19. In addition to that, there's the risk of inflation caused by government bailouts. What I'm doing right now is keeping about 1/3rd in gold ETF as inflatio…

Are you familiar with https://portfoliocharts.com/portfolio/golden-butterfly/

20% Total Stock Market

20% Small Cap Value

20% Long Term Bonds

20% Short Term Bonds

20% Gold

You could replace short term bonds with Cash, TIPS, CDs, Bitcoin.

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#76

Post by gshdg »

Dollar cost averaging into an index fund.

After paying down any high interest debts and earmarking at least 3 months worth of living expenses into a savings account or other cash equivalent as an emergency fund.

There’s a great decision making flowchart floating around somewhere or other.

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#77

Post by mrbonner »

parenthesis wrote: post #69

The world of investing is filled with a lot of bs, conflicts of interest, snake oil, fraud, and plain old incompetence. Therefore, you need to pretty much learn enough that you could do it all yourself. At that point, you might not do it all yourself, but you'll have a decent chance of judging whether or not someone (advisor, robo-advisor, investment fund, index fund provider etc.) you delegate to knows what they are…

Good job! I was nodding along and almost choke to dead from laughing at your last sentence.

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#78

Post by s1t5 »

t0mas88 wrote: post #65
jpn wrote: post #64

1. Open a margin account on Interactive Brokers. 2. Choose a target volatility level you're comfortable with (I like 20%). 3. Buy shares of BRKB. Buy enough such that volatility of your portfolio reaches your target volatility. 4. Every month, update your share amount to maintain the same target volatility. https://alphaarchitect.com/2019/05/22/volatility-targeting-i...

At step 1 I was half expecting this to go towards /r/wallstreetbets and some terrible jokes.

> some terrible jokes

I'm immediately shorting everything you own.

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#79

Post by glofish »

jweather wrote: post #71
glofish wrote: post #33

Earlier quoted context omitted.

overall awfully misguided advice. when you buy foreclosure you are buying all responsibilities for the home - past debts, mortgages, liens, future taxes, repairs etc - in addition you are betting that future appreciation will all pay off - not guaranteed at all. Homes are illiquid and a lot of trouble. no one should just buy a foreclosed home without thorough preparation

Buying a foreclosure is the same as any other home purchase -- get an inspection and title search to know what you're getting into. You're not "buying all responsibilities" any more than you are when purchasing a home the "normal" way.

Saying just get title insurance is exactly what I meant you should be prepared to know what is required and is not something you should jump into thinking of it as easy money.

When you are buying a typical real estate the cost of title search and title insurance are usually part of the settlement process and are included automatically, you don't have to do anything, all gets done for you.

The problem is that with foreclosures that they often are sold via auctions where you don't get to inspect the home, you have to pay cash upfront, getting title insurance is not so given either. Plus you have to do it all yourself. All serious issues.

Re: Ask HN: I've saved up $80k USD. What should I do with it?

#80

Post by BrandonSmith »

gshdg wrote: post #76

Dollar cost averaging into an index fund. After paying down any high interest debts and earmarking at least 3 months worth of living expenses into a savings account or other cash equivalent as an emergency fund. There’s a great decision making flowchart floating around somewhere or other.

There are a handful of them. Some simple, some complex.

Here is a complex one... https://i.imgur.com/c0p24cU.png

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