OT - Money / Investing Thread (aka financial no stupid questions)

[Cincydawg]

My retirement was nearly all in an employee stock plan.  The good news is the company put the money into it for us, and over the years that share went from 5% to 25% of our salary (not a deduction).  The bad news is initially it was all in their stock, they allowed some diversification later but the options were not good.  When I retired, I got it all out (from JP Morgan) into my IRA where I could self manage, but as I've said, I had pros do it for three years until I felt I could handle it.  I got pretty lucky with 4-5 picks over the years, one was Costco which the pros said was too expensive, ha.  Another was Apple.  

I had THOUGHT a retiree should invest only in "safe" dividend paying securities and bonds, but I learned differently from the pros.  That opened my eyes.  Of course I still have ten years in "safer" investments, but the monies I might need further out are in some riskier investments, nothing crazy.

The other key is when a stock goes way up, you can find suddenly you have 25% or more of your portfolio in one stock, which isn't desirable, so rebalancing is key also.

I look at the basket almost daily and trade a few times a week, often selling something over the past couple of years, and buying bonds or less risky stocks.

[utee94]

I kind of forgot about my IRA from the first company I worked for post-undergrad. When I was laid off from that company back in 1998, I rolled it out of the company's 401K and into an IRA.  I'd only been there for 4 years, salaries were pretty depressed at the time, and there really wasn't that much money.  

So fast forward to this year when I'm doing my taxes, and I finally decide to take a look at that fund.  Last time I looked closely, it was maybe around $70K or $80K.  It had been appreciating ok over the decades but like I said, the initial investments were pretty low.  I obviously hadn't been managing it closely at all, I had originally put the money into some moderately aggressive funds plus I left some of it in the company stock and none of those returns were all that great, but since the investment was low, I'd never bothered to rebalance or diversify.  Basically I thought of it as "just not that much money" and not worth my time.

So imagine my surprise when I finally looked closely at it a few weeks back, and saw that it was now up to about $250K.  Apparently my aggressive funds had done pretty well sinve COVID, and also my old company had spun off my old division, given me shares of that stock when it split off, and that particular new stock had done pretty well over that span.

So, yeah.  What I'd considered to be an insignificant part of my retirement portfolio has become something more important, and now that I'm finally paying attention, I'm in the process of rebalancing and diversifying it a bit.

This could probably go in the Happy thread although it didn't happen today....

[bayareabadger]

Immediate 15% return beats the S&P 500 annual return on average. And if you're buying based on a lower lookback price, it's even higher.

So selling it ASAP and then turning around and throwing that in an index fund is still worth maxing out your ESPP contributions. Only problem is that you pay STCG on that 15%, but it's still more than if you were just throwing it in the index from your paycheck.

It also hits twice a year, so it’s 15% on income between 6 and 0 months old. We’re a fan of that. 

It’s been maxed. There’s a slight gap where we either get growth or a few losses to harvest, so that’s nice too. 

[Honestbuckeye]

I kind of forgot about my IRA from the first company I worked for post-undergrad. When I was laid off from that company back in 1998, I rolled it out of the company's 401K and into an IRA.  I'd only been there for 4 years, salaries were pretty depressed at the time, and there really wasn't that much money. 

So fast forward to this year when I'm doing my taxes, and I finally decide to take a look at that fund.  Last time I looked closely, it was maybe around $70K or $80K.  It had been appreciating ok over the decades but like I said, the initial investments were pretty low.  I obviously hadn't been managing it closely at all, I had originally put the money into some moderately aggressive funds plus I left some of it in the company stock and none of those returns were all that great, but since the investment was low, I'd never bothered to rebalance or diversify.  Basically I thought of it as "just not that much money" and not worth my time.

So imagine my surprise when I finally looked closely at it a few weeks back, and saw that it was now up to about $250K.  Apparently my aggressive funds had done pretty well sinve COVID, and also my old company had spun off my old division, given me shares of that stock when it split off, and that particular new stock had done pretty well over that span.

So, yeah.  What I'd considered to be an insignificant part of my retirement portfolio has become something more important, and now that I'm finally paying attention, I'm in the process of rebalancing and diversifying it a bit.

This could probably go in the Happy thread although it didn't happen today....

The long game!👍

[betarhoalphadelta]

one was Costco which the pros said was too expensive, ha.

I find COST fairly intriguing. I don't understand how a boring stock like that, with no explosive growth opportunities on the horizon, can trade at 40-50 forward PE.  

I feel it's a VERY solid company, well managed, beloved by its members--myself included. 

The stock just seems really expensive. It's not a meme stock like TSLA, so it's not like the fundamentals are completely divorced from performance. But it's not a growth stock, so trading at that high of a multiple is weird. It's trading at about 2x the forward PE multiple of NVDA, a company projected for 35% earnings and 30% revenue growth from FY27 to FY28. 

How does COST stay so high?

[FearlessF]

members keep buying stock

[Cincydawg]

Consistent earnings growth ... but other stocks have done about as well in the sector.  

COST: 1,009.99 -4.39 (-0.43%)

[Cincydawg]

Annuities?

[betarhoalphadelta]

Market performance is making me happy.

I generally agree... 


But looking back, what seemed like a great decision (covered call) is something I'm now regretting... Considering the stock closed at $1562 today. The stock is in a MASSIVE run, and I capped my upside. Can't complain that much, given I'm locked into 3350% gain on that stock if I get assigned on the call. But I'm kicking myself more than a little bit. It's an expensive lesson.  

In unrelated [I think] news, I'm stepping back from the financial advisor I started working with when I moved my funds from E*Trade to MSSB, and moving everything back to E*Trade. We'd done nothing together except the covered call, so it's pretty easy to unwind. 

I just don't trust he's going to outperform boring ETFs. And that he's trying to steer me to products that might offer other advantages in the short term (tax loss harvesting) but then I'm fighting the fees--for the fund and his fees--long term. 

So for the stock that's not in the covered call, I sold a chunk (~10%) today. The market forecast is good, so I'm fine letting it run somewhat, but I want to slowly start chipping away and locking in gains. Threw 35% of the capital gains into SGOV since I might have to pay estimated in July, and threw everything else into VTI. Let's hear it for boring index funds, amiright? 
 

[MarqHusker]

Boring ETFs?  Yeah, there are some out there that are boring (*no names from me), but we now have over 5,000 ETFs,   8 out of every 10 new one is 'active' and there sure are some not-boring ETF issues out there.

just wait, we're merely days away from Prediction Market ETFs being declared effective.

*i can't and won't name securities as an associated person of a BD.

[FearlessF]

How much your heirs inherit depends on where you lived. Here’s a state-by-state guide to estate and inheritance taxes and onerous probate fees.

Americans spend a lot of time thinking about where to live for tax purposes. States like Florida and Texas lure both billionaires and ordinary workers by touting their lack of a state income tax. Other states lure seniors with generous exemptions for retirement income. But another question gets less attention: Where is the most expensive place in the U.S. to die?

With the federal estate exemption for 2026 set at a generous $15 million per person ($30 million for a married couple), little more than one in a thousand estates is hit with the federal levy. In contrast, states’ estate and inheritance taxes, as well mandatory estate administration costs, can hit families with more modest wealth surprisingly hard. And since each state tax operates under its own often arcane rules, those costs can come as an unpleasant surprise. But with some advance knowledge and planning, they often can be minimized.

https://www.forb2026/05/15/state-estate-inheritance-taxes-

[Cincydawg]

One thing that "amuses" me is how one can read five stories that are major gloom and doom, and five more that are skies the limit.

I'm trimming some today mostly to rebalance.  My "tech" stocks keep outrunning the rest and getting me over loaded.

[utee94]

Yeah I'm definitely overloaded on Tech, but I always have been given my occupation and specializations.  In general it's been very good for me, although I have taken a couple beatings at various points in time when Tech across the board has faltered.

[847badgerfan]

Choppy market. 

It will settle when people stop reacting to some guy in Iran passing gas.