Search found 670 matches

by rmelvey
Sun Feb 19, 2017 9:44 am
Forum: Investing - Theory, News & General
Topic: US debt approaching $20 Trillion
Replies: 18
Views: 1122

Re: US debt approaching $20 Trillion

Inflation rates are very low right now and there is very high demand for US dollars. The debt is not a burden right now. In fact, I would be more worried about the government trying to pursue a budget surplus than a budget deficit with current conditions.
by rmelvey
Sun Feb 19, 2017 9:42 am
Forum: Personal Consumer Issues
Topic: Why do you go to restaurants?
Replies: 229
Views: 14748

Re: Why do you go to restaurants?

I live in NYC so cooking a lot at home just doesn't feel right... Kitchens are so small in NYC apartments and there is so much incredible food in the city.
by rmelvey
Wed Feb 15, 2017 11:19 am
Forum: Investing - Help with Personal Investments
Topic: Long treasury ETF
Replies: 3
Views: 203

Re: Long treasury ETF

I like TLT best. EDV and ZROZ have more duration (oomph) to them, but they are less liquid incurring higher bid ask/spreads.
by rmelvey
Wed Feb 15, 2017 11:00 am
Forum: Personal Finance (Not Investing)
Topic: Where to buy rare steaks?
Replies: 28
Views: 1960

Re: Where to buy rare steaks?

The steaks at Whole Foods are pretty good. Give it a shot
by rmelvey
Mon Feb 13, 2017 5:20 pm
Forum: Investing - Help with Personal Investments
Topic: Does anyone have $0 in cash (except for bills), not even an emergency fund?
Replies: 45
Views: 2186

Re: Does anyone have $0 in cash (except for bills), not even an emergency fund?

I basically don't have an emergency fund. I have two months worth of expenses in a checking account and the rest in US equities. I sleep better now than when I had a more conservative approach... I have enough in taxable and ROTH to draw down on if need be. Part of what makes this work is that I am ...
by rmelvey
Wed Feb 08, 2017 1:28 pm
Forum: Investing - Theory, News & General
Topic: Should I use margin to buy a balanced fund?
Replies: 897
Views: 174472

Re: Should I use margin to buy a balanced fund?

How did this portfolio survive the recent bond sell off?
by rmelvey
Mon Feb 06, 2017 4:19 pm
Forum: Investing - Help with Personal Investments
Topic: Cost of Living Portfolio to Hedge rising costs
Replies: 12
Views: 840

Re: Cost of Living Portfolio to Hedge rising costs

I think you are overthinking this. Just rent and put your money in TSM. If you want less risk, buy some TIPs as well. Trying to track the price of food/shelter with your portfolio is not realistic.
by rmelvey
Tue Jan 31, 2017 5:04 pm
Forum: Investing - Help with Personal Investments
Topic: ESPP at 5% discount, 6 months holding period
Replies: 18
Views: 1157

Re: ESPP at 5% discount, 6 months holding period

If i had access to this plan I would buy as much as I could, sell after 6 months, then repeat. You are taking single stock risk, but I think the discount more than compensates for that.
by rmelvey
Tue Dec 20, 2016 7:38 pm
Forum: Investing - Help with Personal Investments
Topic: Borrow money to invest?
Replies: 33
Views: 2596

Re: Borrow money to invest?

How are you getting that low of an interest rate? Is this from family? Regardless, 1.05% is a great rate for a 5 year loan. You could buy a 5 year treasury yielding 1.8% and get risk free profit. The people telling you not to take the loan are being dogmatic... There is free money to be made with a ...
by rmelvey
Fri Dec 09, 2016 2:02 pm
Forum: Investing - Help with Personal Investments
Topic: Is US stocks going up too fast?
Replies: 21
Views: 2171

Re: Is US stocks going up too fast?

Nothing about holding the stock market is slow and steady...
by rmelvey
Thu Dec 08, 2016 10:59 am
Forum: Investing - Help with Personal Investments
Topic: Addicted to investing?
Replies: 17
Views: 1774

Re: Addicted to investing?

I think it's normal when you start out to feel that way. However, after watching the market for so long I really feel that it is so unpredictable I can't imagine doing anything but just buying and holding the index.
by rmelvey
Thu Dec 08, 2016 9:52 am
Forum: Investing - Help with Personal Investments
Topic: Trade in IRA, hold in taxable?
Replies: 9
Views: 379

Re: Trade in IRA, hold in taxable?

Tax inefficient investing should be done in tax advantaged accounts. So if you are going to be trading a lot it is better to do that in an IRA than a taxable account.
by rmelvey
Thu Dec 01, 2016 1:20 pm
Forum: Investing - Theory, News & General
Topic: Why is NAASDAQ getting hammered?
Replies: 11
Views: 1599

Re: Why is NAASDAQ getting hammered?

People pay up for high growth stocks when the economy is sluggish because growth is hard to come by. When the economy is improving, growth is much easier to come by and people aren't willing to pay high P/E multiples for growth. Right now, people are positioning their portfolios for a higher growth ...
by rmelvey
Thu Dec 01, 2016 11:45 am
Forum: Personal Consumer Issues
Topic: another New York rental question
Replies: 40
Views: 2792

Re: another New York rental question

At $2K per month her best bet is to have a roommate and hire a monthly cleaner. She could live in a nice building with a doorman and walk to work. Unfortunately she won't find a great solo living option at that price point in Manhattan.
by rmelvey
Thu Dec 01, 2016 11:37 am
Forum: Investing - Help with Personal Investments
Topic: Aren't rising rates good for bond funds?
Replies: 14
Views: 1248

Re: Aren't rising rates good for bond funds?

Yes you are on the right track. If the duration of your assets is shorter than the duration of your liabilies then you benefit from rising rates. I think people get tripped up because the liability (future spending needs) is rarely calculated and measured against their assets. Most people only look ...
by rmelvey
Thu Dec 01, 2016 11:34 am
Forum: Personal Finance (Not Investing)
Topic: 30 Yr Treasury Bonds - Why should't I do this?
Replies: 5
Views: 650

Re: 30 Yr Treasury Bonds - Why should't I do this?

I think holding some 30 year treasuries for income can make sense, but I wouldn't go more than 50% of your portfolio. Holding some stocks along with 30 year treasuries will actually be less risky than going 100% 30 year treasuries. The stock dividends will bounce around a bit more, but they should b...
by rmelvey
Thu Dec 01, 2016 11:07 am
Forum: Personal Finance (Not Investing)
Topic: Feeling like you've "made it"
Replies: 107
Views: 10753

Re: Feeling like you've "made it"

I am 25 and going through a similar issue. My assets have reached the point where they around 1x my annual income, which is enough to feel the ups and downs, but not nearly enough to fuel any extended time out of work. I think the best way to think about it when you are still young is that even if r...
by rmelvey
Thu Nov 17, 2016 3:01 pm
Forum: Investing - Help with Personal Investments
Topic: Is it worth it to harvest taxable a/c to shift earnings to 401k
Replies: 13
Views: 870

Re: Is it worth it to harvest taxable a/c to shift earnings to 401k

I think it makes sense. The only reason it wouldn't is if you needed to make a large purchase before retirement (such as a new house or college). But even then, you could strategize ways to get the money out of the TA accounts (roth contributions, 401k borrow).
by rmelvey
Fri Nov 11, 2016 12:04 pm
Forum: Personal Consumer Issues
Topic: What kind of apartment can $1k get you in your city?
Replies: 80
Views: 6702

Re: What kind of apartment can $1k get you in your city?

NYC. You could get a room share in an old apartment in an undesirable neighborhood :|
by rmelvey
Mon Nov 07, 2016 11:10 am
Forum: Personal Consumer Issues
Topic: Amazon Echo
Replies: 88
Views: 10801

Re: Amazon Echo

I love it. My favorite features include using it as a timer when I'm cooking, playing music, and turning my lights on and off.
by rmelvey
Wed Nov 02, 2016 7:10 am
Forum: Personal Finance (Not Investing)
Topic: Considering Buying Condo in NYC
Replies: 18
Views: 2644

Re: Considering Buying Condo in NYC

After you have purchased the condo will you have enough monthly cash flow to max out the 401k? I live in NYC and one reason I don't consider buying is because I value maxing out the 401k due to the high taxes we enjoy living here...
by rmelvey
Mon Oct 31, 2016 3:36 pm
Forum: Investing - Theory, News & General
Topic: Using long bonds vs. intermediate in 401K?
Replies: 15
Views: 1077

Re: Using long bonds vs. intermediate in 401K?

At 70/30 I think going long duration can make sense. Your portfolio is still dominated by equity risk. But just try to stay the course when interest rates get choppy. Holding long bonds is harder emotionally than holding stocks because the consensus is usually that rates will go higher (even though ...
by rmelvey
Wed Oct 26, 2016 1:06 pm
Forum: Investing - Help with Personal Investments
Topic: BND instead of a saving account
Replies: 7
Views: 1127

Re: BND instead of a saving account

You can get savings accounts that yield 1%. I think a combination of savings accounts and muni bonds makes more sense than BND in a taxable account. With that said, your rationale for not investing doesn't make much sense to me. Stocks won't become any less risky 6 months from now, so if they appear...
by rmelvey
Wed Oct 19, 2016 3:28 pm
Forum: Personal Finance (Not Investing)
Topic: Why have a formal budget?
Replies: 106
Views: 10594

Re: Why have a formal budget?

My income is VERY lumpy and heavily dependent on stock prices. I need a budget to forecast my cash balances. Most months I am drawing down on cash, but I get two large bonuses each year that tops it off. If i didn't budget I wouldn't know how much I could safely spend.
by rmelvey
Tue Oct 18, 2016 8:25 am
Forum: Investing - Theory, News & General
Topic: Another reason to look at International
Replies: 7
Views: 1676

Re: Another reason to look at International

The US economy could survive a slowdown in global trade better than most other developed nations. We have a more diversified economy and trade accounts for a lower share of our GDP than many others. I don't think leaning into international stocks would be the right way to play this (not that I would...
by rmelvey
Tue Sep 06, 2016 8:39 am
Forum: Investing - Help with Personal Investments
Topic: Asset allocation for a 10 year account
Replies: 4
Views: 517

Re: Asset allocation for a 10 year account

One easy way to gut check your allocation is to compare it to the vanguard target retirement funds. Right now the vanguard 2025 fund is 66% stocks and 34% bonds.
by rmelvey
Thu Sep 01, 2016 1:10 pm
Forum: Investing - Help with Personal Investments
Topic: Take the loss and exit market?
Replies: 22
Views: 3115

Re: Take the loss and exit market?

I would stay in and keep buying (that's what I do). But I also do not get worried about 1% drops. Maybe you should stick with savings accounts and CDs. With stocks you have to be ready to hold through 50% (sometimes more!) declines. I don't think they match your risk tolerance.
by rmelvey
Mon Aug 29, 2016 4:19 pm
Forum: Personal Consumer Issues
Topic: Frugality regret: What thing do you regret not spending on?
Replies: 176
Views: 34383

Re: Frugality regret: What thing do you regret not spending on?

I regret not getting a better apartment when i first moved to NYC. I shared an apartment with 5 other people and the apartment was a complete disaster. I had to give people a pep talk before they came to see where I lived. In hindsight I should have just bit the bullet and gotten a normal place.
by rmelvey
Wed Aug 24, 2016 9:34 am
Forum: Personal Finance (Not Investing)
Topic: NYC Living Options
Replies: 37
Views: 3041

Re: NYC Living Options

Don't buy a car. If you really hate the subway just use Uber or yellow cabs. You can certainly find something much cheaper than $3.5-$4K. I live in a 2BR apartment in chinatown for $2,500 and have a roommate so I pay $1,275. Try to keep in mind that you will be meeting and hanging out with people ou...
by rmelvey
Tue Aug 23, 2016 2:23 pm
Forum: Personal Consumer Issues
Topic: Get rich quick?
Replies: 52
Views: 9472

Re: Get rich quick?

Putting up a small amount of margin for S&P futures should do the trick. You will likely lose everything if you keep at it though.
by rmelvey
Fri Aug 12, 2016 7:06 pm
Forum: Investing - Theory, News & General
Topic: Anyone else noticing the economy improving?
Replies: 78
Views: 5012

Re: Anyone else noticing the economy improving?

I live in NYC which is in boom mode right now. I also work in the e-commerce field which is seeing huge growth. If anything, people in NYC are worried about the economy being too hot and pricing out longer term residents.
by rmelvey
Wed Aug 10, 2016 11:43 am
Forum: Investing - Theory, News & General
Topic: Why are bonds taxed more than stocks?
Replies: 29
Views: 3803

Re: Why are bonds taxed more than stocks?

Because the wealthy earn more of their income from stocks :twisted:
by rmelvey
Wed Aug 10, 2016 6:13 am
Forum: Investing - Help with Personal Investments
Topic: Going short to negate going long [socially responsible investing]
Replies: 59
Views: 3501

Re: Going short to negate going long

It might be cheaper and more effective to just buy index funds and donate a little extra each year to an environmentally focused charity.You will drive yourself crazy trying to fit your morals into the markets. I don't like the idea of going short a sector because shorting has extra expenses associa...
by rmelvey
Tue Aug 09, 2016 11:32 am
Forum: Investing - Theory, News & General
Topic: Vanguard - why don't I 'feel' good about them?
Replies: 36
Views: 3941

Re: Vanguard - why don't I 'feel' good about them?

I really enjoy using Fidelity for my taxable account. It's nice to have a different ETF provider for taxable than tax advantaged because it makes it easier to harvest losses while avoiding the wash sale rule. I also like that my taxable account has all of the features of a checking account!
by rmelvey
Sat Aug 06, 2016 7:50 am
Forum: Investing - Theory, News & General
Topic: Margin investing - how risky is it really?
Replies: 33
Views: 2650

Re: Margin investing - how risky is it really?

I don't know how you would correctly calculate the percentages but using margin would really mess up your asset allocation especially if you count the margin loan as a negative bond. I hold derivatives in my retirement account and calculate my asset allocation using notional values (for futures con...
by rmelvey
Fri Aug 05, 2016 10:21 am
Forum: Investing - Theory, News & General
Topic: Margin investing - how risky is it really?
Replies: 33
Views: 2650

Re: Margin investing - how risky is it really?

Another thing to consider is that if you open a margin account your shares can be lent to other investor's and your dividends will no longer be qualified ... Are you saying that merely having a margin account (without borrowing on it) means that dividends paid in that account are not qualified divi...
by rmelvey
Thu Aug 04, 2016 11:44 am
Forum: Investing - Theory, News & General
Topic: Margin investing - how risky is it really?
Replies: 33
Views: 2650

Re: Margin investing - how risky is it really?

Another thing to consider is that if you open a margin account your shares can be lent to other investor's and your dividends will no longer be qualified...
by rmelvey
Wed Aug 03, 2016 11:11 am
Forum: Investing - Help with Personal Investments
Topic: Any renters just focused on maxing out retirement accounts?
Replies: 13
Views: 2107

Re: Any renters just focused on maxing out retirement accounts?

Same boat.

Live in NYC and am maxing out 401k, roth, hsa. I couldn't max out these account if I purchased an apartment, and the tax savings from the 401k are so huge because taxes here are high.

I don't plan on buying property in NYC...
by rmelvey
Wed Jul 27, 2016 11:25 am
Forum: Personal Finance (Not Investing)
Topic: Any retirees here who have been life-long renters?
Replies: 140
Views: 11177

Re: Any retirees here who have been life-long renters?

I am renting right now and I am able to max out my 401k, roth ira, and HSA accounts. If I wanted to purchase a home I would no longer be able to do that because of the down payment as well as higher monthly payments. Since I am in NYC the tax savings from that are substantial. I also like that I can...
by rmelvey
Wed Jul 20, 2016 12:55 pm
Forum: Investing - Theory, News & General
Topic: Why does a massive company like Coca Cola or Johnson Johnson need money from investors?
Replies: 25
Views: 2833

Re: Why does a massive company like Coca Cola or Johnson Johnson need money from investors?

They don't need it and they don't take it. Both of those companies distribute cash to their stockholders in the form of dividends and stock buy backs.
by rmelvey
Tue Jul 12, 2016 4:10 pm
Forum: Investing - Theory, News & General
Topic: Just as hard to lose to the market as to beat it?
Replies: 53
Views: 4324

Re: Just as hard to lose to the market as to beat it?

Buy 100 different funds with 2% expense ratios. That's an easy way to underperform.

As far as selecting securities, that is a lot more difficult. Because if you could easily find what would underperform then you could earn a free lunch as a short seller. That is not very likely...
by rmelvey
Sun Jul 03, 2016 10:04 am
Forum: Investing - Help with Personal Investments
Topic: Long term investing for grandkids
Replies: 10
Views: 450

Re: Long term investing for grandkids

I think equities make sense for a perpetual time horizon, because they are a (risky) perpetuity. However, I think if you want a portfolio that will stand up to the test of time, nothing is more timeless than a Total Market index.
by rmelvey
Fri Jul 01, 2016 10:59 am
Forum: Investing - Help with Personal Investments
Topic: how to reflect paying off mortgage in AA?
Replies: 38
Views: 2031

Re: how to reflect paying off mortgage in AA?

I think including the mortgage AND the home value can make sense. Ignoring the mortgage can lead to some less than rational behavior such as borrowing at 3.5% on your mortgage and buying Treasuries at 1.5%. Outside of liquidity requirements this is a money losing trade! This example omits the value...
by rmelvey
Fri Jul 01, 2016 10:25 am
Forum: Investing - Help with Personal Investments
Topic: how to reflect paying off mortgage in AA?
Replies: 38
Views: 2031

Re: how to reflect paying off mortgage in AA?

I think including the mortgage AND the home value can make sense. Ignoring the mortgage can lead to some less than rational behavior such as borrowing at 3.5% on your mortgage and buying Treasuries at 1.5%. Outside of liquidity requirements this is a money losing trade!
by rmelvey
Thu Jun 30, 2016 4:58 pm
Forum: Investing - Help with Personal Investments
Topic: Getting rid of international funds
Replies: 83
Views: 7602

Re: Getting rid of international funds

US investors can get away with just holding US equities and CDs. It really is that simple. I wouldn't recommend the same for investor's in smaller countries.
by rmelvey
Thu Jun 30, 2016 4:12 pm
Forum: Investing - Theory, News & General
Topic: Equities = musical chairs?
Replies: 93
Views: 4523

Re: Equities = musical chairs?

Equities have no maturity date, so yes there is no guarantee that you will get all of your principal back at a certain date. They are a perpetuity. It is the stream of dividends that give them their value. If you are only spending the dividends the musical chair aspect of them goes away.
by rmelvey
Wed Jun 29, 2016 3:57 pm
Forum: Investing - Theory, News & General
Topic: I think Buffett got this wrong
Replies: 87
Views: 5438

Re: I think Buffett got this wrong

I'm sitting here trying to make a decision. Do I go with the original poster's ideas or do I go with Buffet's ideas? H-m-m-m. Allowing for the fact that past performance is no guarantee of future results, I still think I'm sticking with Warren. Can't blame anyone for going with Buffett over me. Obv...
by rmelvey
Wed Jun 29, 2016 3:32 pm
Forum: Investing - Theory, News & General
Topic: I think Buffett got this wrong
Replies: 87
Views: 5438

Re: I think Buffett got this wrong

Run your data for 30 year treasuries. If you get the same result than something with your analysis is probably off. When bond prices drop their expected return goes up. That is a mathematical fact. Buffett is making a similar comparison with equities. Keep in mind that equities have a duration of ar...
by rmelvey
Wed Jun 29, 2016 3:15 pm
Forum: Investing - Theory, News & General
Topic: I think Buffett got this wrong
Replies: 87
Views: 5438

Re: I think Buffett got this wrong

While this might not be exactly what Buffet is referring to, volatility is the friend of an accumulator and the enemy of someone in distribution mode. They are two sides of the same coin.
by rmelvey
Wed Jun 22, 2016 10:14 am
Forum: Investing - Help with Personal Investments
Topic: 100k+ with 2 year window, how to invest?
Replies: 16
Views: 1120

Re: 100k+ with 2 year window, how to invest?

Personally, I would do 80% bonds and 20% stocks. Yes, there is a risk of losing money but it is a very conservative allocation. I am not a fan of cash except for month to month living expenses. CDs are good too, but I don't like the lack of liquidity for taxable accounts. They make more sense for me...

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