> I-bonds are either free money or the only true money storage...But the government only lets each person buy $10,000 of I-bonds a year.
That's too little to be true money storage. It's not enough to buy any new car.
I accidentally loaned all my money to the US government
351–360 of 512 posts
Re: I accidentally loaned all my money to the US government
#352The obsession with the high variable rate on ibonds right now strikes me as weird. With a fixed rate of 0% at the moment, the ibond is an "investment" which is guaranteed to lose real value because the 'gains' from the ibond are taxed so if the fixed rate is zero it will lose real value. It will also lose value due to systematic understatement of inflation e.g. due to the substitution correction-- but even if you bel…
What are the options? Get -8% on your checking or savings or a very volatile stock market return? It’s perfect for saving for a down payment. I’d still of course max out 401ks and such in addition
I wouldn't say perfect-- in that there is no strong reason to believe that the returns on your ibonds will reflect the amounts you need for your down payment or the discounted future value of your mortgage payments (particularly since CPI excludes housing)... but it might well be the best option available if you have a short time horizon.
For a long time horizon, broad market index investments have reliably outperformed home prices.
It would be an interesting backtesting question: Imagine you have enough money for a down payment on a median priced home, consider two options: put the money into ibonds vs put the money into a market index. Then after X months, what percentage of the time is the investment still able to meet the downpayment requirements of a median priced home (at that time, which might be more or less than before)?
It's not guaranteed that the ibond option will be less volitile because what we're comparing is market vs home-market, so it might not even win out over short term. For really short windows the ibond interest clawback will hurt it too.
Since home prices have increased substantially faster than inflation the success rate of the ibond option will (assuming the future is like the past) tend to 0% success for longer time windows. Since market returns have outpaced housing costs, the market investment will tend to 100% on longer time windows.
Personally, I might well just go the market index route: Even if we presume the ibond success rate is better in a short window (I think that's a reasonable assumption), "It always takes longer than you expect, even when you take into account Hofstadter's Law" and the market index is the clear winner in the long term.
It would be sad to constantly be expecting to buy a house 1 year out, invest in underperforming investments, and as a result never be able to afford a house because they were always escaping your investment!
Re: I accidentally loaned all my money to the US government
#353Earlier quoted context omitted.
It’s bad English. The unambiguous terminology would be simply “excess” or “excess part of the purchase”. The term “excess purchase” sounds like the entire purchase is excess i.e. the adjective “excess” is modifying the noun “purchase” [the purchase was excess]. But they intended it as a noun adjunct where the noun “purchase” is modifying the noun “excess” [the excess was a purchase]. But this parse is not at all pref…
They could purchase up to $10k in bonds. They exceeded that by $25 dollars. Each dollar or penny or half-penny is a separate portion of a bond in my mind, although I don't know how that works legally. So the excess purchase would be the $25 he was in excess of the maximum purchase. Just the way I interpreted it, but by no means the legal or actual way it's handled.
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Re: I accidentally loaned all my money to the US government
#354[deleted]
Re: I accidentally loaned all my money to the US government
#355Earlier quoted context omitted.
I have found there is really good advice out there, it's just in places most people won't look. The first one is books. Go to a book shop, and find a book on personal finances, written by a registered financial advisor in your country, for your country. It'll be long, stuffy, boring as fuck, but you'll likely come away well informed. I think if you're reading HN this would suit. Second one is personal financial advis…
> You should pay them by their time, like you would a doctor. Except it'll cost like $200 I looked into this a couple of months ago. It turns out it costs minimum ~$2,000 here in Australia to get anything that's not "General Advice only".
Ah dang. I was a bit worried I low-balled that number. You might've already seen this, but you tried this guide for finding one? There's a register of advisers in aus, could shop around a bit?
https://static1.squarespace.com/static/5eb4889e5e47b4255c410...
Re: I accidentally loaned all my money to the US government
#356The venn diagram of internet users that read about super specific financial products, decide to buy them, while not even understanding the need to keep an emergency fund such that a move like this leaves them with under $200 in their account seems to be growing. It seems to be a weird mix of wall street cosplay and financial ineptitude.
I have witnessed this working at FAANG where people usually have the choice to allocate their grants into either risky options or safe, straight cash. The amount of people I see going all-in into the riskiest option and then proceeding to not understand why they lost their "compensation" (?) when the stock drops frightens me.
Because recruiters love to go on and on about how "if the stock goes to a billion, you'll make a zillion," and they never, ever, ever mention that the stock might become worthless. The other thing is that we've had absolutely stellar economic growth since the 2008 crash, and no one under the age of 32 was working before 2008, so they really have no notion that the economy won't always be growing. It's just not on their radar.
Re: I accidentally loaned all my money to the US government
#357> This pseudo-security measure actually only slows down humans, not bots, because you can still edit the value of the text field using Javascript (and in fact it's easier to do it that way if you know how). Surely this is to prevent keyloggers, no slowing down bots. With that said it is questionable if it is worth it. People would probably pick less secure password as a result.
It's also case-insenstive and limited to 8-16 characters, further decreasing the complexity.
They actually require a capital letter when creating an account. This led to a few moments of me looking for the shift key on the on-screen keyboard before noticing the note next to the password field.
Re: I accidentally loaned all my money to the US government
#358I thought this was funny. Weird comments in the thread about how he/she should have known better. Author is not making a complaint to demand internet outrage. There is no inflammatory justice warrior content here. Sheesh! Author admits they screwed up, decided to share the screwup, and who hasnt been trough that exact dunder blunder? Fun short read 8/10.
This wasn’t the authors fault at all. It’s 2022, not 1998. I would expect a banking/payment UI to be very clear and foolproof.
Hah, if you've ever used the TreasuryDirect site it's a disaster from the Windows XP days. Reminds me of those old Flash and Silverlight apps. The keyboard in the article is a virtual keyboard you click to type your password in for "security" reasons (yet there's no 2FA app supported).
Re: I accidentally loaned all my money to the US government
#359I thought this was funny. Weird comments in the thread about how he/she should have known better. Author is not making a complaint to demand internet outrage. There is no inflammatory justice warrior content here. Sheesh! Author admits they screwed up, decided to share the screwup, and who hasnt been trough that exact dunder blunder? Fun short read 8/10.
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Re: I accidentally loaned all my money to the US government
#360This reminds me of when I gave my new work-subsidized printer my CC during the pandemic.
It tried ordering new ink based on supply levels and apparently became upset with the supply chain delays so it kept trying to order as the ink remained low. (Of course, I didn’t recognize this for a while…)
Silly me, I had assumed someone would code a simple ‘check-if’ flag in the ‘order ink’ algorithm…