even the good ones make mistakes while investing. since you are young and in school i would recommend you keep the money safe until you know more about investing. everyone has their own investing style. i recommend you find you style by reading as much as you can and learning about investments before you make a move into higher returning investments. since you are in school i doubt you have the time needed to do this so keep it safe. take a sure thing for the short term.
Nothing is ever in the bank until it is in the bank
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even the good ones make mistakes while investing. since you are young and in school i would recommend you keep the money safe until you know more about investing. everyone has their own investing style. i recommend you find you style by reading as much as you can and learning about investments before you make a move into higher returning investments. since you are in school i doubt you have the time needed to do this so keep it safe. take a sure thing for the short term.
The assumption is that he will be making a retirement contribution from normal income sources.
For a short term period like he is considering I dont see the huge benefit on a one time retirement investment, it should come yearly from normal sources. I think everyone should forgo (well most everyone) tax returns and invest the ammt instead.
If I recall (I think I am right here) that even under a down payment exemption, that only covers PRINCIPAL, not earnings on the principal..I think the principal is ok to WD without penalty, but the earnings are subject to tax..for a HOUSE that is..now other things qualify for earnings and gains..but I dont think a house dows (I might be wrong, but I think that is how I recall it).
So he has to fill out tax forms, deal with the broker to WD the funds, on such a small ammt. I would rather he invest a tax refund or even just ear mark regular funds for an IRA and keep this liquid outside a retirement acct.
No, that's not right. The principal, I assume you mean the contribution amount, can always be withdrawn at any time by any Roth IRA completely tax and penalty free. It is only the earnings and appreciation that is subject to tax and/or penalty. It is from there that he can use the 10K first downpayment exception to exclude from tax and penalty.
But for anyone who does a Roth, he can always withdraw the contribution at any time with no tax consequence. Of course, normally you want to keep it sitting tax-free for as long as possible, but in a pinch the Roth can be used as an emergency fund.
At least that is my understanding.
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Quote Originally Posted by wallstreetcappers:
D2,
The assumption is that he will be making a retirement contribution from normal income sources.
For a short term period like he is considering I dont see the huge benefit on a one time retirement investment, it should come yearly from normal sources. I think everyone should forgo (well most everyone) tax returns and invest the ammt instead.
If I recall (I think I am right here) that even under a down payment exemption, that only covers PRINCIPAL, not earnings on the principal..I think the principal is ok to WD without penalty, but the earnings are subject to tax..for a HOUSE that is..now other things qualify for earnings and gains..but I dont think a house dows (I might be wrong, but I think that is how I recall it).
So he has to fill out tax forms, deal with the broker to WD the funds, on such a small ammt. I would rather he invest a tax refund or even just ear mark regular funds for an IRA and keep this liquid outside a retirement acct.
No, that's not right. The principal, I assume you mean the contribution amount, can always be withdrawn at any time by any Roth IRA completely tax and penalty free. It is only the earnings and appreciation that is subject to tax and/or penalty. It is from there that he can use the 10K first downpayment exception to exclude from tax and penalty.
But for anyone who does a Roth, he can always withdraw the contribution at any time with no tax consequence. Of course, normally you want to keep it sitting tax-free for as long as possible, but in a pinch the Roth can be used as an emergency fund.
Yeah, we are understanding the same thing..note the other messages in the thread on the subject. Principal is ok to take out..so the real benefit is only the gains, and to me keeping such a small ammt in a Roth, for such a small ammt of time doesnt really do it for me.
Someone should regulalry, every year make a contribution, not just if you get a windfall like he mentioned.
Think about it in real terms..the guy is in the bottom tax bracket, so he is saving 15% on the gains tax wise, and if he made market returns (which I dont think the next 10 yrs will equal the average past returns) how much is he saving really? Not that much..
Now I also said if he will not be making a retirement contribution this year then he should take some and do that..but it shouldnt be the SOURCE of his retirement funds if you ask me.
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D2,
Yeah, we are understanding the same thing..note the other messages in the thread on the subject. Principal is ok to take out..so the real benefit is only the gains, and to me keeping such a small ammt in a Roth, for such a small ammt of time doesnt really do it for me.
Someone should regulalry, every year make a contribution, not just if you get a windfall like he mentioned.
Think about it in real terms..the guy is in the bottom tax bracket, so he is saving 15% on the gains tax wise, and if he made market returns (which I dont think the next 10 yrs will equal the average past returns) how much is he saving really? Not that much..
Now I also said if he will not be making a retirement contribution this year then he should take some and do that..but it shouldnt be the SOURCE of his retirement funds if you ask me.
The gold bug advice on gold is an extreme one, but gold does have its uses in deflationary times, and some people feel we are heading into the post Bretton Woods collapse mentioned in the clip below.I just throw in the clip as a quick idea on inflation/gold prices seem to work.
Prof. Reamer, I always have a problem understanding what
makes gold go up. Is it mainly the inverse relationship between gold
and the dollar? If that's the case then if it is also an inflation
hedge, that would mean rates would have to be raised and the dollar
would rise. Help me out on this one. Thanks, MJ
Professor Reamer's Reply The
correlation between gold and the US dollar index (DXY) (the average of
six major currencies vs. the USD) is minus 0.42 over the last two
years, minus 0.44 over the last nine years and minus 0.28 over the last
17 years. A +1 correlation means perfect correlation (gold goes up,
dollar goes up), a -1 correlation means perfectly anti-correlated
(dollar goes up, gold goes down), and a 0 correlation means no
correlation whatsoever. What the above tells you is that the widely
held belief that gold goes up when the dollar goes down is not
supported by the statistics: a -0.28 correlation is a weak correlation
at best and is certainly within the normal volatility that these two
date series exhibit.
So, in the US, M3 has gone up by something
like 207% over the last 20 years while gold has gone up in USD terms by
58%. So has gold been a hedge against inflation over this time frame?
Of course not - stocks have been a better hedge against inflation than
gold, and property even more of a hedge than that.
But that is
not to say that gold doesn't have its uses: gold will likely be a
fantastic wealth preservation vehicle once the fiat currency regime
(the post Bretton Woods system with the US as global economic hegemon)
comes to a grinding and ignominious end (a certainty approaching 1 on
the probability scale - timing less certain). I would encourage you to
read the book The Golden Constant by Roy W Jastram - it makes the
unintuitive case (with a look over the historical data from 1560-1976)
that gold performs better (in appreciation terms) under deflationary
regimes rather than inflationary ones, thus throwing a significant
wrench into the idea that gold protects under inflationary regimes
(dollar down, gold up).
0
The gold bug advice on gold is an extreme one, but gold does have its uses in deflationary times, and some people feel we are heading into the post Bretton Woods collapse mentioned in the clip below.I just throw in the clip as a quick idea on inflation/gold prices seem to work.
Prof. Reamer, I always have a problem understanding what
makes gold go up. Is it mainly the inverse relationship between gold
and the dollar? If that's the case then if it is also an inflation
hedge, that would mean rates would have to be raised and the dollar
would rise. Help me out on this one. Thanks, MJ
Professor Reamer's Reply The
correlation between gold and the US dollar index (DXY) (the average of
six major currencies vs. the USD) is minus 0.42 over the last two
years, minus 0.44 over the last nine years and minus 0.28 over the last
17 years. A +1 correlation means perfect correlation (gold goes up,
dollar goes up), a -1 correlation means perfectly anti-correlated
(dollar goes up, gold goes down), and a 0 correlation means no
correlation whatsoever. What the above tells you is that the widely
held belief that gold goes up when the dollar goes down is not
supported by the statistics: a -0.28 correlation is a weak correlation
at best and is certainly within the normal volatility that these two
date series exhibit.
So, in the US, M3 has gone up by something
like 207% over the last 20 years while gold has gone up in USD terms by
58%. So has gold been a hedge against inflation over this time frame?
Of course not - stocks have been a better hedge against inflation than
gold, and property even more of a hedge than that.
But that is
not to say that gold doesn't have its uses: gold will likely be a
fantastic wealth preservation vehicle once the fiat currency regime
(the post Bretton Woods system with the US as global economic hegemon)
comes to a grinding and ignominious end (a certainty approaching 1 on
the probability scale - timing less certain). I would encourage you to
read the book The Golden Constant by Roy W Jastram - it makes the
unintuitive case (with a look over the historical data from 1560-1976)
that gold performs better (in appreciation terms) under deflationary
regimes rather than inflationary ones, thus throwing a significant
wrench into the idea that gold protects under inflationary regimes
(dollar down, gold up).
By the way, since he is still in the news, the article did continue with a quote from Greenie...
Whatever can be argued about its implications for gold's behavior in
inflation, the abrogation of Bretton Woods in 1971 did not change the
fact that gold is the only money when the chips are down. This was a
major conclusion of Professor Jastram’s research. [22] For the
continuing validity of this proposition, we cite as an authority none
other than Lord Greenspan, Tsar of All the Monies, Defender of the
Fiat, Best Friend of Leveraged Speculators, who testified as recently
as 1999 that [23]
... gold
still represents the ultimate form of payment in the world. It's
interesting that Germany could buy materials during the war only with
gold. In extremis fiat money is accepted by nobody and gold is always
accepted and is the ultimate means of payment…
Do I think it merely possible
that our fiat dollar will someday collapse? If yes, then I should own
gold. How much? As much as I can comfortably rationalize, perhaps using
some sort of calculation of the gravity of the harm -- i.e., financial
wipeout -- discounted by my sense of the probability of its occurrence.
0
By the way, since he is still in the news, the article did continue with a quote from Greenie...
Whatever can be argued about its implications for gold's behavior in
inflation, the abrogation of Bretton Woods in 1971 did not change the
fact that gold is the only money when the chips are down. This was a
major conclusion of Professor Jastram’s research. [22] For the
continuing validity of this proposition, we cite as an authority none
other than Lord Greenspan, Tsar of All the Monies, Defender of the
Fiat, Best Friend of Leveraged Speculators, who testified as recently
as 1999 that [23]
... gold
still represents the ultimate form of payment in the world. It's
interesting that Germany could buy materials during the war only with
gold. In extremis fiat money is accepted by nobody and gold is always
accepted and is the ultimate means of payment…
Do I think it merely possible
that our fiat dollar will someday collapse? If yes, then I should own
gold. How much? As much as I can comfortably rationalize, perhaps using
some sort of calculation of the gravity of the harm -- i.e., financial
wipeout -- discounted by my sense of the probability of its occurrence.
I have decides what im gonna do with the money ! I am gonna take the $10,000 then put it on one game or one hand of blackjack. Most likely blackjack that way I will not go crazy trying to find the perfect game. Yes I know this is insane but im final on it. I will be going to vegas for my bday oct 11. I will kepp you updated on this and let you know the exact day and time I will be making the bet it will be anytime between oct 10-12 so if anyone i respect has great advice please let me know cause otherwise most likely I will be making the play late night oct 11th on one hand of blackjack
0
I have decides what im gonna do with the money ! I am gonna take the $10,000 then put it on one game or one hand of blackjack. Most likely blackjack that way I will not go crazy trying to find the perfect game. Yes I know this is insane but im final on it. I will be going to vegas for my bday oct 11. I will kepp you updated on this and let you know the exact day and time I will be making the bet it will be anytime between oct 10-12 so if anyone i respect has great advice please let me know cause otherwise most likely I will be making the play late night oct 11th on one hand of blackjack
modern, dude that's cool but make sure you have enough cash to double down or split if need be. I'll be in Vegas the weekend after, too bad, or I'd watch ya. But do be sure to have the funds to double or split. You don't want to be dealt an 11 v. 6 and have to say "hit me". If you have 10K only, unless you have someone with cash to back you up, then I'd say split it and bet half at all times. Of course, if you win, you have a problem -- then what are you gonna do with the 20K...after the 600 dollar hookers?
Good luck.
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modern, dude that's cool but make sure you have enough cash to double down or split if need be. I'll be in Vegas the weekend after, too bad, or I'd watch ya. But do be sure to have the funds to double or split. You don't want to be dealt an 11 v. 6 and have to say "hit me". If you have 10K only, unless you have someone with cash to back you up, then I'd say split it and bet half at all times. Of course, if you win, you have a problem -- then what are you gonna do with the 20K...after the 600 dollar hookers?
I would put it into 3 no load 5 star mutual funds. You can go to Morningstar.com. to research all funds. I would pick an international (like artesan or Dodge & Cox), an index fund (vanguard very good) and a small cap fund (like Buffalo). A 3way split would be a great blend for you at your age and the expenses from each of the ones you pick should be 1.25% or lower as a rule of thumb. You can open an account at Scottrade or TDameritrade and do it all yourself. They have satellite offices where they will give you some guidance at no charge.
Best Wishes!
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I would put it into 3 no load 5 star mutual funds. You can go to Morningstar.com. to research all funds. I would pick an international (like artesan or Dodge & Cox), an index fund (vanguard very good) and a small cap fund (like Buffalo). A 3way split would be a great blend for you at your age and the expenses from each of the ones you pick should be 1.25% or lower as a rule of thumb. You can open an account at Scottrade or TDameritrade and do it all yourself. They have satellite offices where they will give you some guidance at no charge.
I am gonna have to do $5,000 on one hand as I don't have the other $10,000 I would need to split or double down If I win $1,000 goes to courtside laker tickets. If I lose I will still have the $5,000 and I will either use it all to buy gold or a vanguard fund till I am ready to buy a house. Wish me luck I will keep you update perhaps sunday night I can get some picks for a game instead of a hand of cards seeing as I will be driving through vegas from phoenix to LA monday.
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I am gonna have to do $5,000 on one hand as I don't have the other $10,000 I would need to split or double down If I win $1,000 goes to courtside laker tickets. If I lose I will still have the $5,000 and I will either use it all to buy gold or a vanguard fund till I am ready to buy a house. Wish me luck I will keep you update perhaps sunday night I can get some picks for a game instead of a hand of cards seeing as I will be driving through vegas from phoenix to LA monday.
I have decides what im gonna do with the money ! I am gonna take the $10,000 then put it on one game or one hand of blackjack. Most likely blackjack that way I will not go crazy trying to find the perfect game. Yes I know this is insane but im final on it. I will be going to vegas for my bday oct 11. I will kepp you updated on this and let you know the exact day and time I will be making the bet it will be anytime between oct 10-12 so if anyone i respect has great advice please let me know cause otherwise most likely I will be making the play late night oct 11th on one hand of blackjack
LMAO!!!!
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Quote Originally Posted by modernavalon:
I have decides what im gonna do with the money ! I am gonna take the $10,000 then put it on one game or one hand of blackjack. Most likely blackjack that way I will not go crazy trying to find the perfect game. Yes I know this is insane but im final on it. I will be going to vegas for my bday oct 11. I will kepp you updated on this and let you know the exact day and time I will be making the bet it will be anytime between oct 10-12 so if anyone i respect has great advice please let me know cause otherwise most likely I will be making the play late night oct 11th on one hand of blackjack
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