Investing in this market

[Koolau]

In 10 years new Gas cars will be gone for purchase and Walmart and Target will be offering electric car charging discounts while you shop.

Don't know about Target and Costco, but If the 10 years to no gas cars is a serious bet, I'll take $50 against that. YMMV

 

[marko]

Yes, very clever, now where's that button!

I found it!

 

[target2019]

Yes, very clever, now where's that button!

Click on a name and gander at the drop-down menu.

 

[pb4uski]

From the WSJ... hold on to your hats:

... Going back to 1950, the S&P 500 has sold off at least 15% on 17 occasions, according to research from Vickie Chang, a global markets strategist at Goldman Sachs Group Inc. On 11 of those 17 occasions, the stock market managed to bottom out only around the time the Fed shifted toward loosening monetary policy again. ...

And the Fed has only just gotten started. After approving its largest interest-rate increase since 1994 on Wednesday, the central bank signaled that it intends to raise rates several more times this year so it can tamp down inflation. ...

 

[copyright1997reloaded]

Agreed. Bought a hybrid in March. The right car for this “older type”.

Same here. Might have gotten a PHEV (plug-in Hybrid) if it were available in my model purchase (but it wasn't) as it includes a larger battery and likely most local trips just on battery power.

I guess an alternative might be to buy a F150 lightning and carry a gas/diesel powered generator in the back for those "long" trips.

 

[Koolau]

Click on a name and gander at the drop-down menu.

Yeah. Actually never used it. YMMV

 

[purplesky]

Can't confirm Moab as either pricey or cheap. But GETTING there at $6/gallon is expensive. People who can afford a $60K to 100K Tesla can probably afford the electricity.

The average new car price is supposedly around 50k. People love their big car payments.

I can confirm Moab Utah is not just for rich people. I will be in Moab in a few days
And luckily splitting fuel and hotel costs.

 

[purplesky]

From the WSJ... hold on to your hats:

Energy inflation makes it even worse.

Thats why the electric car issue is interesting. Looking forward.

 

[purplesky]

Don't know about Target and Costco, but If the 10 years to no gas cars is a serious bet, I'll take $50 against that. YMMV

Yes throw in China and Europe and California and I will take the bet.

10 years is a long time.

 

[daylatedollarshort]

Teslas are pretty common in our area. They are 2 of the top selling 5 cars in California.

 

[Koolau]

Teslas are pretty common in our area. They are 2 of the top selling 5 cars in California.

Popular in HI as well but still overwhelmed by masses of Toyotas of all types - especially Prius.

 

[eyenitnoy]

I am wondering what people are doing right now if they have spare cash to invest. If I was 10 years younger I'd maybe be less hesitant -I'm 47 and would like to retire at 60. Due to some aggressive savings over the last few years and an inheritance I have about $275 k to invest. Ideally, I'd average that out and take advantage of dollar-cost averaging over a longer period but given my time horizon I'm not sure how to strategize (also complicating this is inflation and the current market). Additionally, I am likely going to sell an investment property in the next while which will put another sizable bit of cash in hand (not sure how much we'll get but my guess is about 150k after all expenses/ taxes).

We are in okay shape as we head for retirement. We have no mortgage, we have a few rental properties which will be paid off in the next few years (income generating with expenses more than paid for by tenants so no need to pay those down), maxed out RRSPs, TSFAs (with some room - which creates a tax-free investment for some of the cash mentioned above). I can get a moderate pension at 60 from work. What I'm hoping to do with this additional money is to create additional wealth for a more comfortable retirement. Likely we could wait to draw down on most of this until 65 if we needed to.

In any case, I know that no one can time the market or know what is going to happen but curious about how others are investing in these times and what others might do if you had cash sitting idle ready to invest.

At 47, investing in a low fee index fund (such as VOO or VTI) on a regular basis, such as monthly or bi-monthly, right now makes good sense to me.

 

[Theophrastus Bombastus]

What is important is that my comfort zone is not breached. I am not easily swayed by others.

That said, it's ultimately your choice on what to do. Don't let the opinions of others, who have no skin in your game, sway you.

I concur with W2R - AND would also add that the only additional thing I would personally consider doing (which I have done in the past under similar circumstance) is to bolster my emergency cash holdings. I know that people have frequently stated holding 2,3,6,12 months in liquid savings is enough. I built up significantly more than that over time, especially as I got closer to retirement.

Naysayers told me that it'll bring my down annual returns and that I would be losing money in the long run. Perhaps - but insurance premiums cost money. This is my self insurance against black swan events - and I gladly afford the premium.

A friend once told me, "There are many bold pilots and there are many old pilots, but there are very, very few bold old pilots."

I sleep well at night.

As the commercial says
- PRICELESS.

 

[eyenitnoy]

What is important is that my comfort zone is not breached. I am not easily swayed by others.

That said, it's ultimately your choice on what to do. Don't let the opinions of others, who have no skin in your game, sway you.

I concur with W2R - AND would also add that the only additional thing I would personally consider doing (which I have done in the past under similar circumstance) is to bolster my emergency cash holdings. I know that people have frequently stated holding 2,3,6,12 months in liquid savings is enough. I built up significantly more than that over time, especially as I got closer to retirement.

Naysayers told me that it'll bring my down annual returns and that I would be losing money in the long run. Perhaps - but insurance premiums cost money. This is my self insurance against black swan events - and I gladly afford the premium.

A friend once told me, "There are many bold pilots and there are many old pilots, but there are very, very few bold old pilots."

I sleep well at night.

As the commercial says
- PRICELESS.

I think you are right about the cash reserves. I keep three years worth and this allows time to ride out big downturns in the market.

If you are in the market, the last thing you want is to be forced to sell at the bottom because you need money for living expenses.

 

[Koolau]

I think the insurance analogy applied to cash is excellent. Yes, insurance may cost you some money. But when you need it - you may REALLY need it. When DW and I moved to the Islands, we knew we would be remodeling so we planned on saving the cash for that. Turns out, we sold our old house and never got round to putting the money into investments. Good thing. Cost of remod. were more than we thought and, we had only my modest pension to live on (no SS yet) so we did the right thing without knowing why. Actually, I think I knew, but it wasn't front-of-the-mind thinking that left us with all that very timely and useful cash.

I've mentioned before that we had too much of our stash in 401(k) and tIRAs. Nor did we have much in taxable. So cash was great to have. As always, everyone's situation is different so YMMV.

 

[Bdarr]

Isn't the goal to buy low with money you do not need for ten years? There are many outstanding companies on sale now and likely to be even cheaper in the future unless you think the worst is over!?
Divide the number by 24 and start DCA in is one idea! But personal finances are....personal!

 

[RobLJ]

Yes, oil and gas companies employ millions of people and provide goods and services to most Americans. They provide fuel to heat your house, cook your food, run farm machinery and your car, make plastics (like you are typing on), make compounds for pharmaceuticals, make fuel for aircraft, and on and on.

To make a comprehensive list of the products that come out of hydrocarbons would take a day of typing, but I am sure you get the idea!

Try living without hydrocarbons.

As a counter to your narrative, my wife worked for Dynegy 6 years before Enron and had to receive her 401k match in Dynegy stock. No alternative to Dynegy stock, although when energy shot up I thought about buying options against Dynegy, just as a precaution, even though I had never used option and still have not. So, I invested her and my investments as far away from oil and gas as I could get, not wanting to put our eggs in one oil and gas basket, so to speak. Then Enron went bankrupt, so did Dynegy after buying Enron's gas pipeline, and my wife's 401k match went from about 100k to 5k. After the great fall, we were then "allowed" to sell Dynegy stock in her 401k match, which was truly magnanimous behavior from Dynegy, since the stock was worth less than a buck a share at that point. I knew Enron employees who invested everything in that great oil and gas company and went from millionaires to nothing in a month or two. So personally I thank, oil and gas, for nothing. You bet I'm still bitter about oil and gas and their behavior.

Admittedly, this abuse of the 401k system has been reformed, but only after the complete collapse of Enron, Dynegy and their employees. We refused to invest our own 401k monies in Dynegy, thank God, although I'm sure some of our mutual fund ownings did invest some money.

 

[RobLJ]

On topic to OP, I would favor putting a chunk (25-50%) in the market--if it were my money (and it isn't)--whatever you feel comfortable losing another 10-20% in, and DCA the rest over 1-3 years.

As pb4uski posted, I do not think the Fed is done raising yet, although perhaps the market collapses will pay chicken with the Fed and win, as the market has done successfully for the last 20 years. If so, then throwing the whole chunk in will do fine, although I wouldn't count on this, given the inflation issue and what I feel is the Fed's need to "do something"--namely raise rates.

It's your money though, your life, and your goals, so I wouldn't listen either to me or anyone else who blithely tells you to throw the whole chunk in the fire now (or drip it out over 5 years).

Do what allows you to sleep at night and fits your financial plan.

 

[HarveyS]

Yes you are correct that electric cars are crazy expensive for the most part. The new Ford F150 lightning pick up truck has a reasonable entry level point assuming Ford can keep their cost down and offer that Price out the door.

But all the new cars are expensive now. The new Toyota tundra TRD pro is about $74,000 plus the dealer Mark Ups and a new Toyota sequoia TRD pro Is about $75,000.

Everything is expensive.

Maybe big auto is fleecing the middle class?

 

[tulak]

If I was OP, I’d make a plan to buy equities over the next six months in ~50k chunks and accelerate buying if/when there are significant drops. If the market gets really low - 40%+ correction - I’d go all in.

Personally, I’ve been buying into this market and will continue as much as possible. I’m at a similar age and still working, so it makes it easier, but I keep a certain amount of money in safe investments in case things get bad. Whatever is leftover goes into equities (index funds, mainly vti).

I suspect that in 10 years I’ll be happy that I bought equities.