5 ms·

> I would be stupid to put any more money into it. As a millennial who will not be retiring (period) unless severely injured, where else would I put my savings

> I would be stupid to put any more money into it. As a millennial who will not be retiring (period) unless severely injured, where else would I put my savings? My checking account rate is 0%. Whole Term life insurance only can be "cashed in" after building 20+ years. I'm holding some long term positions in stocks (risk), but honestly, I cant find anywhere else I would put the bulk than a savings account.

knicholes 10y ago
Could buy homes to rent out.
JBReefer 10y ago
90% VTI 10% BND. So far, 6.3% return this year (based on arbitrary pay ins, no market timing used)
grardb 10y ago
Fellow millennial here. I'd recommend investing in stock indexes. Your money, on average, will grow at a faster rate than inflation. If you leave your money in a checking or savings account, you will lose money to inflation. If you're interested, I'd check out: - The Mr. Money Mustache blog (my personal favorite) - r/personalfinance - patio11 also wrote an article on investing recently: https://training.kalzumeus.com/newsletters/archive/investing-for-geeks?__s=esaiz3kazigwidftsigk https://training.kalzumeus.com/newsletters/archive/investing... A relevant MMM blog post (there are plenty others): http://www.mrmoneymustache.com/2011/05/18/how-to-make-money-in-the-stock-market/ http://www.mrmoneymustache.com/2011/05/18/how-to-make-money-... There are also a lot of other blogs if you're not into his philosophy or writing style. Edit: Just for clarity, I know that you said you invest in stocks currently, but I was mostly speaking to, "I cant find anywhere else I would put the bulk than a savings account." I don't have a savings account, and I treat my investments like savings. You shouldn't need a lot of money in your current savings account, but you should have a lot in investments. If you feel the need to have a lot in your savings account, I'm guessing it means you take money out of it often, in which case it might as well be in a checking account. Just my $0.02.
- FilterSweep 10y ago
  Very much appreciated! Do you self-invest, or hire a professional, or mixed? Currently I'm managing my own stocks. My employer, my IRA and other monies I'll never get to see.
  - grardb 10y ago
    To start off, I used Vanguard and did it all myself, which is a great option (many would say the best). I've since switched to Wealthfront, which is also pretty cool, although some people believe their slightly-higher fees don't buy you anything[1]. I personally disagree! The general consensus from what I've read on investing is that it's impossible to beat the market consistently, so "professionals" are no more skilled than someone picking out random investment decisions from a hat :) On average, the market as a whole grows, so there's no real reason to try to risk beating it. The MMM blog covers all of this in great detail, but if you're interested in chatting more about this stuff (or if you want a referral to Wealthfront for reduced fees!), hit me up. My email is [myusername]@gmail. [1] https://medium.com/@blakeross/wealthfront-silicon-valley-tech-at-wall-street-prices-fdd2e5f54905#.d1ybm8xaq https://medium.com/@blakeross/wealthfront-silicon-valley-tec...
    - sf_rob 10y ago
      > The general consensus from what I've read on investing is that it's impossible to beat the market consistently The slight addendum to this is that advisors can help with risk tolerance, tax efficiency, and explaining concepts, but as you mentioned Robo-advisors like WealthFront arguably do a good enough jobs at these topics to bridge the gap.
    - toomuchtodo 10y ago
      > To start off, I used Vanguard and did it all myself, which is a great option (many would say the best). I've since switched to Wealthfront, which is also pretty cool, although some people believe their slightly-higher fees don't buy you anything[1]. I personally disagree! Interesting! I switched from Betterment TO Vanguard once I didn't need the guidance they provide (and corresponding higher asset management charges) anymore (target date funds in retirement accounts, life strategy funds in taxable accounts for extreme early retirement Mr Money Mustache style).
sf_rob 10y ago
> I'm holding some long term positions in stocks, but honestly, I cant find anywhere else I would put the bulk than a savings account. Unless you have a reason to be risk averse, then continuing what you're doing is probably best (e.g. ETFs/mutual funds/stocks/bonds). Buying into the market is a great passive way to grow your wealth.
ghaff 10y ago
If you're looking for near-zero risk, there's really nowhere you can invest that's much above 0%. The good news is that inflation is also near 0%. (Although that's not much consolation is you're trying to save up for housing in areas where that's appreciating rapidly.) Saving has always been about taking a portfolio approach. Risk free investments have never had a great return relative to inflation. (Because basically they can't.)
- r00fus 10y ago
  Uhm - how is inflation at 0%? Core inflation (which ignores health, energy, food prices) may be low, but real inflation over the past 10 years has been very high - I'd say probably close to 50% total.
  - dragonwriter 10y ago
    > Core inflation (which ignores health, energy, food prices) may be low, but real inflation over the past 10 years has been very high - I'd say probably close to 50% total. And you'd be wrong. Inflation as measured by the CPI-U-RS (not the "core" version, which excludes food and energy -- not "food, health, and energy" as you stated), looking at end of year indexes to get annual inflation over the Dec. 2005- Dec. 2015 period had a high of 4% per year in 2007 and a low of 0.06% in 2008, an average of 1.87% per year, and a total of 20.28% increase in price index over the 10 year period -- the average of that period is just over half the average annual rate of inflation (3.36%) of the Dec. 1977 to Dec. 2015 period, so its hardly been "very high" in the last 10 years. And the last two years have been, while not as low as 2008, still not far from 0, with 0.76% in 2014 and 0.72% in 2015. (Source: http://www.bls.gov/cpi/cpiursai1977-2015.xlsx http://www.bls.gov/cpi/cpiursai1977-2015.xlsx + math.)
  - ghaff 10y ago
    You'd have to provide numbers to convince me about food and energy costs (the latter of which have been historically quite variable in any case). A quick look at food pricing says that restaurant pricing has gone up faster than raw goods pricing. Yes, health case has certainly increased by significantly more than the CPI. As has housing in some areas (but not in others). In any case, a 2% annual increase of prices still amounts to something like 22% over 10 years. But 2% is still pretty close to zero inflation relative to many historical periods.
a_c_s 10y ago
The traditional advice for long-term (7+ year) savings is a mix of low-cost index funds and bonds. Other options include real estate (either by directly buying property or via a REIT), "accredited investors" could angel-invest in startups, and some people really like owning gold/precious metals.
- FilterSweep 10y ago
  I own some silver! Although that's more of a catastrophe hedge, hah. Unfortunately I don't have enough capital for real estate, but I've gotten some great replies to my (parent) on going for index funds.
elif 10y ago
I've done well with bitcoins. If you look at just about any 1 year or 2 year or 3 year period, bitcoin has had great returns. There were only 2-3 spikes you could have bought during to lose money on a long position. EDIT: I invest in this in addition to my 401k which is 25% stocks and 75% a guaranteed return fund. I wouldn't recommend bitcoin exclusively.
twblalock 10y ago
Max out your 401k and Roth IRA. You won't be able to retire by saving cash unless you have an extremely high savings rate relative to your income -- and even then, inflation will erode the purchasing power of your cash. Don't buy whole life insurance. It's a pretty bad idea.

knicholes 10y ago

Could buy homes to rent out.

JBReefer 10y ago

90% VTI 10% BND. So far, 6.3% return this year (based on arbitrary pay ins, no market timing used)

grardb 10y ago

Fellow millennial here. I'd recommend investing in stock indexes. Your money, on average, will grow at a faster rate than inflation. If you leave your money in a checking or savings account, you will lose money to inflation. If you're interested, I'd check out: - The Mr. Money Mustache blog (my personal favorite) - r/personalfinance - patio11 also wrote an article on investing recently: https://training.kalzumeus.com/newsletters/archive/investing-for-geeks?__s=esaiz3kazigwidftsigk https://training.kalzumeus.com/newsletters/archive/investing... A relevant MMM blog post (there are plenty others): http://www.mrmoneymustache.com/2011/05/18/how-to-make-money-in-the-stock-market/ http://www.mrmoneymustache.com/2011/05/18/how-to-make-money-... There are also a lot of other blogs if you're not into his philosophy or writing style. Edit: Just for clarity, I know that you said you invest in stocks currently, but I was mostly speaking to, "I cant find anywhere else I would put the bulk than a savings account." I don't have a savings account, and I treat my investments like savings. You shouldn't need a lot of money in your current savings account, but you should have a lot in investments. If you feel the need to have a lot in your savings account, I'm guessing it means you take money out of it often, in which case it might as well be in a checking account. Just my $0.02.

FilterSweep 10y ago
Very much appreciated! Do you self-invest, or hire a professional, or mixed? Currently I'm managing my own stocks. My employer, my IRA and other monies I'll never get to see.
- grardb 10y ago
  To start off, I used Vanguard and did it all myself, which is a great option (many would say the best). I've since switched to Wealthfront, which is also pretty cool, although some people believe their slightly-higher fees don't buy you anything[1]. I personally disagree! The general consensus from what I've read on investing is that it's impossible to beat the market consistently, so "professionals" are no more skilled than someone picking out random investment decisions from a hat :) On average, the market as a whole grows, so there's no real reason to try to risk beating it. The MMM blog covers all of this in great detail, but if you're interested in chatting more about this stuff (or if you want a referral to Wealthfront for reduced fees!), hit me up. My email is [myusername]@gmail. [1] https://medium.com/@blakeross/wealthfront-silicon-valley-tech-at-wall-street-prices-fdd2e5f54905#.d1ybm8xaq https://medium.com/@blakeross/wealthfront-silicon-valley-tec...
  - sf_rob 10y ago
    > The general consensus from what I've read on investing is that it's impossible to beat the market consistently The slight addendum to this is that advisors can help with risk tolerance, tax efficiency, and explaining concepts, but as you mentioned Robo-advisors like WealthFront arguably do a good enough jobs at these topics to bridge the gap.
  - toomuchtodo 10y ago
    > To start off, I used Vanguard and did it all myself, which is a great option (many would say the best). I've since switched to Wealthfront, which is also pretty cool, although some people believe their slightly-higher fees don't buy you anything[1]. I personally disagree! Interesting! I switched from Betterment TO Vanguard once I didn't need the guidance they provide (and corresponding higher asset management charges) anymore (target date funds in retirement accounts, life strategy funds in taxable accounts for extreme early retirement Mr Money Mustache style).

sf_rob 10y ago

> I'm holding some long term positions in stocks, but honestly, I cant find anywhere else I would put the bulk than a savings account. Unless you have a reason to be risk averse, then continuing what you're doing is probably best (e.g. ETFs/mutual funds/stocks/bonds). Buying into the market is a great passive way to grow your wealth.

ghaff 10y ago

If you're looking for near-zero risk, there's really nowhere you can invest that's much above 0%. The good news is that inflation is also near 0%. (Although that's not much consolation is you're trying to save up for housing in areas where that's appreciating rapidly.) Saving has always been about taking a portfolio approach. Risk free investments have never had a great return relative to inflation. (Because basically they can't.)

r00fus 10y ago
Uhm - how is inflation at 0%? Core inflation (which ignores health, energy, food prices) may be low, but real inflation over the past 10 years has been very high - I'd say probably close to 50% total.
- dragonwriter 10y ago
  > Core inflation (which ignores health, energy, food prices) may be low, but real inflation over the past 10 years has been very high - I'd say probably close to 50% total. And you'd be wrong. Inflation as measured by the CPI-U-RS (not the "core" version, which excludes food and energy -- not "food, health, and energy" as you stated), looking at end of year indexes to get annual inflation over the Dec. 2005- Dec. 2015 period had a high of 4% per year in 2007 and a low of 0.06% in 2008, an average of 1.87% per year, and a total of 20.28% increase in price index over the 10 year period -- the average of that period is just over half the average annual rate of inflation (3.36%) of the Dec. 1977 to Dec. 2015 period, so its hardly been "very high" in the last 10 years. And the last two years have been, while not as low as 2008, still not far from 0, with 0.76% in 2014 and 0.72% in 2015. (Source: http://www.bls.gov/cpi/cpiursai1977-2015.xlsx http://www.bls.gov/cpi/cpiursai1977-2015.xlsx + math.)
- ghaff 10y ago
  You'd have to provide numbers to convince me about food and energy costs (the latter of which have been historically quite variable in any case). A quick look at food pricing says that restaurant pricing has gone up faster than raw goods pricing. Yes, health case has certainly increased by significantly more than the CPI. As has housing in some areas (but not in others). In any case, a 2% annual increase of prices still amounts to something like 22% over 10 years. But 2% is still pretty close to zero inflation relative to many historical periods.

a_c_s 10y ago

The traditional advice for long-term (7+ year) savings is a mix of low-cost index funds and bonds. Other options include real estate (either by directly buying property or via a REIT), "accredited investors" could angel-invest in startups, and some people really like owning gold/precious metals.

FilterSweep 10y ago
I own some silver! Although that's more of a catastrophe hedge, hah. Unfortunately I don't have enough capital for real estate, but I've gotten some great replies to my (parent) on going for index funds.

elif 10y ago

I've done well with bitcoins. If you look at just about any 1 year or 2 year or 3 year period, bitcoin has had great returns. There were only 2-3 spikes you could have bought during to lose money on a long position. EDIT: I invest in this in addition to my 401k which is 25% stocks and 75% a guaranteed return fund. I wouldn't recommend bitcoin exclusively.

twblalock 10y ago

Max out your 401k and Roth IRA. You won't be able to retire by saving cash unless you have an extremely high savings rate relative to your income -- and even then, inflation will erode the purchasing power of your cash. Don't buy whole life insurance. It's a pretty bad idea.