Going cash today

[bimmerfrk]

Originally Posted by Grip Addict

I have stocks, company stock plans, I have a 401k but I hate them all.

I learned in finance class and just from life that $1 today is better than MAYBE $2 tomorrow.

Your dollar today will be .75 cents in the future really due to inflation. You had a poor finance professor.

[gatorfast]

Meh, don't try to time the market. Stay invested. Dollar cost average in over time. There will be ups and downs but the market always prevails.

[Merlin_83]

Originally Posted by flybigjet

Pretty much did a similar thing.

Pulled out the cash for the M2C-- my wife (who manages my 401k) and my father (who manages my personal investments) both convinced me to pull cash off the table-- the theory being that when the market corrects, I can either have a new car, or I can watch my "paper profits" go up in smoke.

So, car.

Do you fly 777 ? Or 737-XXX ?

[flybigjet]

Originally Posted by Merlin_83

Do you fly 777 ? Or 737-XXX ?

I've flown the Triple, but currently fly the 737-700/800/900/900ER/Max.

R.

[jsf721]

I came to write this. I’m old 53 and I remember 2008 and 2011 and I’m through those and better than ever.

You cannot time the market. You can get lucky once and awhile but Nobody can do that consistant. Sorry.

Originally Posted by gatorfast

Meh, don't try to time the market. Stay invested. Dollar cost average in over time. There will be ups and downs but the market always prevails.

[MisterF80M3]

I'm surprised no one posted a chart of the history of Dow Jones.

[gatorfast]

Originally Posted by jsf721

I came to write this. I’m old 53 and I remember 2008 and 2011 and I’m through those and better than ever.

You cannot time the market. You can get lucky once and awhile but Nobody can do that consistant. Sorry.

Yup even over the last 12 years since the crash there have been a ton of ups and downs. Many points where you thought we are due for a major correction. Maybe some people could have timed those perfectly and sold at the top and reinvested after the pullback. But probably not. If you just stay invested and ride it out you will be fine.

[corn18]

Originally Posted by gatorfast

Yup even over the last 12 years since the crash there have been a ton of ups and downs. Many points where you thought we are due for a major correction. Maybe some people could have timed those perfectly and sold at the top and reinvested after the pullback. But probably not. If you just stay invested and ride it out you will be fine.

Yup, the market hasn't been straight up since 2009. But the two near bear we saw had very quick recoveries, so it feels like an endless bull market. There were a few folks on the finance fora that went cash after the two 19%+ dips, but they missed out on a lot of gains after that. Although I gotta say that 2018 was a very shitty year.

[2000cs]

Today’s going to be rough. Futures down (Dow) over 700 points as I post this. Is it Coronavirus, Bernie, both?

[RickFLM4]

Corona

[FQ06]

Corona, inverted curve and Bernie... in that order. Just adjusting prices closer to where they should have been anyway. Forward PE was assuming too much.

[bimmerfrk]

Originally Posted by FQ06

Corona, inverted curve and Bernie... in that order. Just adjusting prices closer to where they should have been anyway. Forward PE was assuming too much.

Good thing I'm all cash for now.

[MaC-N54-E82]

Originally Posted by bimmerfrk

Good thing I'm all cash for now.

Originally Posted by bimmerfrk

Good thing I'm all cash for now.

Be sure to update the thread when you get back in the market.

[DETRoadster]

Originally Posted by bimmerfrk

Good thing I'm all cash for now.

Everyone - "You cant time the market."
bimmerfrk - "Hold my beer"

[corn18]

Everyone’s in the same spot we were when he made the first post. The race will continue.

[grocerylist]

Originally Posted by DETRoadster

Everyone - "You cant time the market."
bimmerfrk - "Hold my beer"

Yeah, if he's so confident then he should be shorting the market.

[WestRace]

1000 points drop is not as bad as what it means.

As for Bernie, the business communities will just come up with something like Bloomberg to ensure another four years for Trump. They may not like Trump but Bernie will be much worse for them.

[bimmerfrk]

Originally Posted by grocerylist

Yeah, if he's so confident then he should be shorting the market.

Who says I'm not? Shorted Tesla at 900 last run. I pick my shorts very carefully. Today was an easy day to short not everyday is.

Also there is a difference between being short macro / micro. I short on a micro level but I buy and sell my portfolio on a macro level. 401k portfolio is usually a macro tied portfolio so treat it as such. If you want to find small deals and trades thats a bit more micro level trading. The deal is to not confuse on for another....

[FQ06]

Market timing has become very difficult with the speed and velocity of market movements on news. Computer trading has completely changed things, not to say the algorithms are always right, but they move the market faster than you can digest news to make an informed decision.
Long term, the only timing you should do is rebalance back to your target allocation if the portfolio has drifted too far in either direction.
Short term, you shouldn't have short term money in the market.
Shorting the market... losing long term strategy, you say you are not a long term investor? Then cash is the right choice for you
(not directed at you frk)

[chassis]

Load up the truck on equities. Stay fully invested.

[XKxRome0ox]

Originally Posted by roastbeef

there is zero taxes to be paid in a backdoor roth. my wife and i each max out a roth each year. i write a check to my guy and he just does it. not complicated at all on our end.

hmmm
how?

is it because if you are past a certain income level, you can't get tax deduction for the traditional IRA contribution anyway? so you're already taxed on the money so it avoid being taxed on the back end?

i'd check to make sure 100% how it works
because you don't want to put away all this money thinking you're going to take your money out of a "Roth" and then end up owing taxes
(i'm genuinely asking because i've kinda heard about this "backdoor Roth IRA" thing and want to do it as well)

[corn18]

Backdoor Roth process:

1. Make a non deductible contribution to a traditional IRA
2. Convert the contribution to Roth

Just that simple. You can do this for both you and a spouse.

Some gotchas:

1. If you have any money anywhere in a traditional IRA, you will be subject to the pro rata rule and that can create some serious reporting and tax headaches. So, if you already have money in tIRAs, then get really smart or find a CPA that is really smart (most are clueless when it comes to backdoor Roths). If you do have tIRAs and a 401k, you could see if you can roll the tIRAs into your 401k if your 401k allows it and your 401k has good funds. 401k balances are not subject to the pro rata rule.
2. If you have ANY earnings on the tIRA contributions when you do the conversion, you can leave them in the tIRA and pay no taxes. But that will create headaches if you want to do another backdoor Roth next year. What I do is just convert the earnings to Roth and pay the taxes at the time. Since I only wait a week between contributing to the tIRA and converting to Roth, I usually have no earnings. Makes life easier.

3. Filling out the 8606 tax form is a must and can be baffling. I keep very careful track of all of my Roth conversions as well as filing the 8606.

Withdrawing from a Roth is fairly complex if you have contributions, conversions and/or earnings. If you are over 59 1/2, withdraw away. No taxes, no penalties. If you are under 59 1/2, you can always withdraw contributions tax and penalty free. But a backdoor Roth is NOT a contribution, it is a conversion and that has special rules for withdrawals. Here are the Roth withdrawal rules:

ORDER OF DISTRIBUTIONS
Regular contributions
Taxable portion of first conversion
Nontaxable portion of first conversion
Each subsequent conversion, in order, with the taxable portion coming out first for each conversion
Earnings (any increase in value occurring inside the Roth IRA)

TAXES AND PENALTIES

UNDER AGE 59.5
FIVE YEAR CONVERSION HOLDING PERIOD NOT MET
Contributions: Tax-No; Penalty-No
Conversions: Tax-No; Penalty-Yes (Taxable Portion)
Conversions: Tax-No ;Penalty-No (Nontaxable Portion)
Earnings: Tax-Yes; Penalty-Yes

UNDER AGE 59.5
FIVE YEAR CONVERSION HOLDING PERIOD MET
Contributions: Tax-No; Penalty-No
Conversions: Tax-No; Penalty-No (Taxable Portion)
Conversions: Tax-No; Penalty-No (Nontaxable Portion)
Earnings: Tax-Yes; Penalty-Yes

OVER AGE 59.5
LESS THAN FIVE YEARS SINCE OPENING FIRST ROTH IRA
Contributions: Tax-No ;Penalty-No
Conversions: Tax-No; Penalty-No (Taxable Portion)
Conversions: Tax-No; Penalty-No (Nontaxable Portion)
Earnings: Tax-Yes; Penalty-No

OVER AGE 59.5
FIVE YEARS OR MORE SINCE OPENING FIRST ROTH IRA
All Distributions Are Qualified
No Taxes
No Penalties

Another very cool option is the mega backdoor Roth. This is where you make after tax contributions to your 401k (not Roth 401k) and then do an in-service rollover of that money into an external Roth. Your plan needs to allow this. Mine does and I have been cramming $19,500 a year into my Roth. Add that to the $14k between my wife and I backdoor Roths, and we are putting a lot of money each year into our Roths. By the time I retire, there will be a significant balance in all of our Roths. And it has a lot of earnings that will come out tax free.

Are you cornfused now? I'm still not sure I get all the little details, but I am comfortable putting the money in.