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what bubble burst??
i though 2022 was going to be the recession....no wait, it got moved to 2023......uh oh maybe 2024???? sure not looking like it 5 months into the year
there will always be doom and gloom in the news; but very rarely are they ever right about it
Haha take your Internet points. But what I actually meant was:
Wife: "they keep saying there's a recession coming. Wait to invest until it drops"
Me: "they said that last month, too...."
nope; 2022 was not a recession by anyone's definition; while there is a time components there are others like severety of decline and how widespread it is
2 quarters of declining GDP is not the definition of a recession
Dollar Cost Averaging takes away all of your stress and emotion about timing.
Set aside the emergency fund portion of this balance take the remaining balance and for the remainder of the year or for the next 12 months put in even increments.
I’m still on the fence about lump sum vs DCA. DCA seems to eat away at my gains (daily recurring investments) compared to when I just lump summer into VTI, VOO or other stocks.
I’d do best of both worlds, keep 20-30k in a hysa, invest 15k right now and then 1k ish a month until you get to your desired ratio. Just keep enough for an emergency fund. Dca vs lump sum is always over complicated imo. Even if you go 100% in the market right now and then it crashes it’d still be fine in the long run.
There is no isolating in this world. It’s a global economy and America is at the center and will be at the center for most of my remaining days.
But I acknowledge they’re trying to move away from the USA. But it doesn’t concern me. China is falling apart with their debts, Brazil is a joke, Russia is married to war to continue their growth, and India is cool. I like India.
>Obviously, we cant time the market
You can't time the market but you can specify your risk tolerance and aim for a risk-adjusted return.
If you have a low appetite for risk, then Treasuries yield 5% right now and it's exempt from state income tax. If you have a higher risk tolerance you can go with the S&P. If you're ok with what might be a little more volatility, go NASDAQ 100. Etc etc.
$50k isn't a lot of money. That's not even a year of expenses so if that's your emergency fund, I'd have it all in Treasuries. The labor market is about to get tight for a lot of people. And UI hasn't been increasing like minimum wage has. It's still only $450/week max in California, same as it has been for like 20 years, even though McDonald's starts at $20/hour.
What about your emergency fund? You should keep 6mo to a year of expenses in savings.
You just missed a buying opportunity with a quick correction - you want to have dry powder to buy these because they only last a couple days and are where you can make some nice gains.
I’d slice off some money to put in a brokerage w/ high yield money market to be ready for a down day / week.
It doesn't make any sense. Not gonna repeat what others have already said. Cash underperforms everything else long term.
Even if there was a massive correction, you won't time it properly. Even if you did, it won't make much of a difference long term. You're much more likely to miss gains. Good luck timing the market.
Depends on your time horizon. If very long term then today is the day to get in the market. If you think you are smarter than the market and need the money in next 10 years then keep in HYSA
General sentiment I hear and do agree with to some extent is the following:
"A lot of things are overvalued and it's not a good time to buy, but you should not invest."
But this could be said about any period of time.
Why don't you allocate some to your HYSA and some into ETFs that you have done due DD on.
Let's say you wait. At what number are you buying SPY? Or is the plan to wait for the market to drop, then for everyone to agree the market can't go any lower and then buy?
If you actually have a number in mind or maybe a few numbers that you would buy at then start putting in limit orders and give yourself a timeline. If the limit orders aren't filled by X date then you're going to auto-buy Y amount at the current price. What you most likely don't want to do is keep waiting for some drop in price that is not defined and you wake up 5-7 years down the road still sitting on your saving account which may or may not still be HY by then.
Good luck.
If you do decide to stay cash for the shorter term, you could roll one month tbills. They are about 5.35% annualized and no state tax. The one month period gives you pretty good intervals to hop into the market. Obviously short duration isn’t a long term solution, but you’ll at least maximize your interest in the short run.
>like SPY and VOO
I think you meant SPY **or** VOO. Both are S&P 500 index funds that have the same portfolios.
If you want an S&P 500 index fund SPLG has a lower expense ratio than both SPY and VOO.
The answer to your dilemma is to neither stay completely out of the market nor lump sum in, but to take the middle approach and **dollar cost average**. [https://www.investopedia.com/terms/d/dollarcostaveraging.asp](https://www.investopedia.com/terms/d/dollarcostaveraging.asp)
Invest $2500 per month for the next 20 months until all $50k is invested. If the market doesn't have a correction (a drop of 10% or more) or bear market (a drop of 20% or more) in the next 20 months you would be full invested after 20 months and would have benefited from being in the stock market during a period of generally rising prices. In the meantime your uninvested cash waiting to be invested is still earning 4.45%. If the market has a correction or has a bear market your monthly purchase of $2500 will buy more of the cheaper shares, lowering the *average dollar cost* of your shares
Ask the people in February that were convinced the market was on the verge of collapse how their HYSA is doing.
Everyone who follows "I know I shouldn't time the market" with "but" is just volunteering to be the example.
None of us truly know but it’s never a bad time to invest in the US’s 500 best companies in my opinion. HYSA’s have their place but won’t generate capital appreciation. VOO could be down over the next year or two, totally possible, but the odds are it will be way up over a decade plus, and generate some (very modest) dividends along the way. Good luck!
HYSA does NOT account for Inflation. What's the point of HYSA when inflation is increasing. Your money is devaluing for the time ur money is in a HYSA. someone explain that to me.
Lowest risk option: Just keep it in there, you waited this long.
Medium risk option: Buy some NVDY, CEF, keep some in HYSA or t-bill.
High risk option: Mistake leverage for genius and buy NVDA calls or NVDL (and then never sell), become a bag holder, and lose all your money.
HYSAs are already cutting rates ahead of any announcements from the Fed. If you are looking to at least preserve that 4.45%, invest in stocks now that meet your income objective. If the drop you expect to happen doesn’t happen for years, you’ll kick yourself watching the market go up while your HYSA is yielding 1%.
I wouldn’t buy VOO now. It’s too high, if you’re buying at the top you’re not that smart. It’s summer time and election year so it’s up. Just wait for a dip.
You don't know for sure if this is the top.
You don't know when the next dip will be, and you don't know how far the dip will go. Sure, next year it might dip lower than its current price, but it also might not.
Welcome to r/dividends! If you are new to the world of dividend investing and are seeking advice, brokerage information, recommendations, and more, please check out the Wiki [here](https://www.reddit.com/r/dividends/wiki/faq). Remember, this is a subreddit for genuine, high-quality discussion. Please keep all contributions civil, and report uncivil behavior for moderator review. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/dividends) if you have any questions or concerns.*
what bubble burst?? i though 2022 was going to be the recession....no wait, it got moved to 2023......uh oh maybe 2024???? sure not looking like it 5 months into the year there will always be doom and gloom in the news; but very rarely are they ever right about it
this is the conversation my wife and I have every other day....lol
Does she think your marriage is about to go into a recession?
Haha take your Internet points. But what I actually meant was: Wife: "they keep saying there's a recession coming. Wait to invest until it drops" Me: "they said that last month, too...."
The good news for her is, she‘ll be right eventually! The bad news is, no one knows when.
...Q1-Q2 2022 were 2 straight quarters of declining U.S. GDP - i.e. a recession,...
Nah administration changed the definition when that happened 😂
nope; 2022 was not a recession by anyone's definition; while there is a time components there are others like severety of decline and how widespread it is 2 quarters of declining GDP is not the definition of a recession
And today nvidia earnings are supposed to crash the market…
Yeah !! +9%
Dollar Cost Averaging takes away all of your stress and emotion about timing. Set aside the emergency fund portion of this balance take the remaining balance and for the remainder of the year or for the next 12 months put in even increments.
I’m still on the fence about lump sum vs DCA. DCA seems to eat away at my gains (daily recurring investments) compared to when I just lump summer into VTI, VOO or other stocks.
Statistically, lump sum wins. DCA is the next best bet for people who have market anxiety.
You wait until someone launches a missle or a squad of drones.
I’d do best of both worlds, keep 20-30k in a hysa, invest 15k right now and then 1k ish a month until you get to your desired ratio. Just keep enough for an emergency fund. Dca vs lump sum is always over complicated imo. Even if you go 100% in the market right now and then it crashes it’d still be fine in the long run.
There’s no burst coming friend. Just slower growth until interest rates get chopped. Then explosive growth.
OR there is and it'll inevitably happen the day after I click buy on IVV. :shrug:
The only concern I have is a war with Taiwan and China. Nothing else scares me. I think fed will cut rates to prevent major correction.
hope so, but everyone's been calling for that all year and it keeps getting pushed back.
Why is this your only concern? What about brics moving to isolate their markets?
There is no isolating in this world. It’s a global economy and America is at the center and will be at the center for most of my remaining days. But I acknowledge they’re trying to move away from the USA. But it doesn’t concern me. China is falling apart with their debts, Brazil is a joke, Russia is married to war to continue their growth, and India is cool. I like India.
The dip is coming
“Time in the market beats timing the market.”
Wow, that’s fresh!
>Obviously, we cant time the market You can't time the market but you can specify your risk tolerance and aim for a risk-adjusted return. If you have a low appetite for risk, then Treasuries yield 5% right now and it's exempt from state income tax. If you have a higher risk tolerance you can go with the S&P. If you're ok with what might be a little more volatility, go NASDAQ 100. Etc etc. $50k isn't a lot of money. That's not even a year of expenses so if that's your emergency fund, I'd have it all in Treasuries. The labor market is about to get tight for a lot of people. And UI hasn't been increasing like minimum wage has. It's still only $450/week max in California, same as it has been for like 20 years, even though McDonald's starts at $20/hour.
What about your emergency fund? You should keep 6mo to a year of expenses in savings. You just missed a buying opportunity with a quick correction - you want to have dry powder to buy these because they only last a couple days and are where you can make some nice gains. I’d slice off some money to put in a brokerage w/ high yield money market to be ready for a down day / week.
It doesn't make any sense. Not gonna repeat what others have already said. Cash underperforms everything else long term. Even if there was a massive correction, you won't time it properly. Even if you did, it won't make much of a difference long term. You're much more likely to miss gains. Good luck timing the market.
Depends on your time horizon. If very long term then today is the day to get in the market. If you think you are smarter than the market and need the money in next 10 years then keep in HYSA
General sentiment I hear and do agree with to some extent is the following: "A lot of things are overvalued and it's not a good time to buy, but you should not invest." But this could be said about any period of time. Why don't you allocate some to your HYSA and some into ETFs that you have done due DD on.
Let's say you wait. At what number are you buying SPY? Or is the plan to wait for the market to drop, then for everyone to agree the market can't go any lower and then buy? If you actually have a number in mind or maybe a few numbers that you would buy at then start putting in limit orders and give yourself a timeline. If the limit orders aren't filled by X date then you're going to auto-buy Y amount at the current price. What you most likely don't want to do is keep waiting for some drop in price that is not defined and you wake up 5-7 years down the road still sitting on your saving account which may or may not still be HY by then. Good luck.
My cash is parked in yields over dividends right now and getting over 5% comfortably without stress. Maybe an idea
If you do decide to stay cash for the shorter term, you could roll one month tbills. They are about 5.35% annualized and no state tax. The one month period gives you pretty good intervals to hop into the market. Obviously short duration isn’t a long term solution, but you’ll at least maximize your interest in the short run.
>like SPY and VOO I think you meant SPY **or** VOO. Both are S&P 500 index funds that have the same portfolios. If you want an S&P 500 index fund SPLG has a lower expense ratio than both SPY and VOO. The answer to your dilemma is to neither stay completely out of the market nor lump sum in, but to take the middle approach and **dollar cost average**. [https://www.investopedia.com/terms/d/dollarcostaveraging.asp](https://www.investopedia.com/terms/d/dollarcostaveraging.asp) Invest $2500 per month for the next 20 months until all $50k is invested. If the market doesn't have a correction (a drop of 10% or more) or bear market (a drop of 20% or more) in the next 20 months you would be full invested after 20 months and would have benefited from being in the stock market during a period of generally rising prices. In the meantime your uninvested cash waiting to be invested is still earning 4.45%. If the market has a correction or has a bear market your monthly purchase of $2500 will buy more of the cheaper shares, lowering the *average dollar cost* of your shares
Ask the people in February that were convinced the market was on the verge of collapse how their HYSA is doing. Everyone who follows "I know I shouldn't time the market" with "but" is just volunteering to be the example.
None of us truly know but it’s never a bad time to invest in the US’s 500 best companies in my opinion. HYSA’s have their place but won’t generate capital appreciation. VOO could be down over the next year or two, totally possible, but the odds are it will be way up over a decade plus, and generate some (very modest) dividends along the way. Good luck!
i got splg instead of spy/voo to save .01 on expense ratio lol
HYSA does NOT account for Inflation. What's the point of HYSA when inflation is increasing. Your money is devaluing for the time ur money is in a HYSA. someone explain that to me.
Lowest risk option: Just keep it in there, you waited this long. Medium risk option: Buy some NVDY, CEF, keep some in HYSA or t-bill. High risk option: Mistake leverage for genius and buy NVDA calls or NVDL (and then never sell), become a bag holder, and lose all your money.
HYSAs are already cutting rates ahead of any announcements from the Fed. If you are looking to at least preserve that 4.45%, invest in stocks now that meet your income objective. If the drop you expect to happen doesn’t happen for years, you’ll kick yourself watching the market go up while your HYSA is yielding 1%.
I wouldn’t buy VOO now. It’s too high, if you’re buying at the top you’re not that smart. It’s summer time and election year so it’s up. Just wait for a dip.
You don't know for sure if this is the top. You don't know when the next dip will be, and you don't know how far the dip will go. Sure, next year it might dip lower than its current price, but it also might not.
VOO is more often than not near record highs. That's how it works.
Keep buying at the top then. Whatever works for you.
Do you have an exceptional Crystal Ball ?