What would you do if you were me? (investment strategy)

[smihaila]

Regarding the house--prices in my area (PA) seem to be shooting up for no good reason other than the low interest rate. [...] Homes I'd consider to be worth ~140k are selling for $160k. In a matter of days.

Wow.

Owning a house is a lot of continuing expense and/or work. It's just a lifestyle choice that you have to consider based on your preferences and situation. This link here sums it up in a pretty memorable manner: https://jlcollinsnh.com/2013/05/29/why-your-house-is-a-terrible-investment/

Thanks for the link. Have you read the users' comments at the end btw? They are excellent. I subscribe to many of those points about HOAs, condos (communism and a plethora of never-ending, always-increasing fees), and renting-as-a-form-of-living-with-low-expectations-of-lifestyle.

But yeah, owning a house is a big responsibility, and considering the quality of the "timber frame construction on wood sticks and glued wood chips" -) ) throughout all the North America (at least in the residential market segment), a money pit.

In Europe, assuming money is available (they are more expensive there), one would consider buying into a House (with capital H i.e. brick, mortar, concrete) because it really lasts and it can be passed between generations and without too much consumerist-kind maintenance. But I digress (I could write a separate dissertation about my view on the houses in North America - Canada included ).

That's not to imply that home ownership is bad, as jlcollins points out. The whole post is merely an argument against the universal refrain of "a house is a great investment because it goes up in value!"

Very true. And those saying that a house is their single best investment is because they never tried a different investment, or simply got lucky or speculative.

The question is not whether the Denver/Boulder area is a hot real estate market NOW. The question is what it will be like if/when you want to sell (or need to sell, because--as you point out--you have no control over the citizenship/immigration matter).

Well, nobody has a crystal ball, but with careful planning and patience, one could buy a house in an area showing a "price endurance" or time-tested price resilience, especially if taking into consideration factors such as location, schools, water quality, stable soils / foundation, no surrounding environmental and health hazards, preference for no HOA and other tax/fee leeches etc.

I totally get being sick of moving--I've moved twice in two years! NOT fun. But my outsider's view, anyway, is that buying a home might not be the best idea right now. Once the citizenship issue is cleared up, my view on the matter would probably soften significantly.

Citizenship is a so loooong target. Permanent residence could be a more tangible objective. And should the worst happen during this "journey" and the house needing to be sold, I would be content with selling it at cost, just to recoup and move on.

As for 'buying stocks on sale,' I'd never advise that for a retiree or someone who needs the withdrawal! That's only for someone who expects to have time in the market for that investment to grow.

Yes, great point and clarification. I brought up this aspect, because the "fire sales" can act two ways. And the folks at the end of the sale side, and who have to sell not because of timing the market but in order to ensure meet their "cash out to make the ends meet" objectives during retirement, it is not at all accommodating as situation.

I'd like to clarify the brokerage comment. I mean that you can hold stocks and/or bonds and/or real estate investment trusts in a brokerage account. That money is taxable, so I think it's a better vehicle for stocks, on which you pay capital gains only when you take the money out. Bonds/REITs are subject to taxation whether you reinvest your dividends or not.

Oh, now I see what you meant - thanks for clarifying.
Well, I would obviously favor any investment vehicles that are not tax-deferred / of the "registered" kind. The 401(k) with employer matching affair, is my only exception to the rule (hence my commitment to only the 6% of my paychecks to that).

From a taxable portfolio perspective, there is nothing special about online brokerages. They are one of the many means to hold taxable accounts. One could very well go also with CDs with a larger bank or credit union, robo-advisor stock investments etc.

Like I said, you should probably consult an experienced professional on that matter, because I'm not sure if your non-US (I think you specified Canadian?) citizenship adds additional tax considerations. It might, or it might not.

The tax aspects when holding assets in more than one country but living in just one, are always more complex and sensitive, indeed.

You DO have some experience in the matter, and it sounds like you're disinclined to use a brokerage. That's perfectly fine, I was just throwing an option out there[...] But if it would be a lot of hassle, that suggestion might not be worthwhile. Feel free to ignore anything or everything I suggested!

No, not at all. And I appreciate the advice. The online brokerages + taxable accounts (note that brokerages can also have registered accounts) are definitely the way to go if I decide to enter the stock market right now and get 100% invested into stocks.

You could definitely purchase an individual bond if you want! Again, I'm not sure how that would be affected if you left the country. I wouldn't think it would be that complicated--since the gov. was happy to take your money, so you'd think it should be redeemable no matter where in the world you're at.

Bonds that would be "redeemable anywhere", is rather far-fetched, because we aren't talking about Government bond issues like those savings bonds or TIPS (or what their name is). Or bearer bonds that you could redeem wherever country you go.
The idea was about bonds traded on the bond issuer market (i.e. still thru brokerages). But like any other taxable account, one would look for ways to redeem them from outside the country they have been purchased from. So I wouldn't see them too different than a CD at a bank. It's just that one would be more exposed to market fluctuations if bond not held to maturity, and having to sell prematurely, right?

I suggest fee-only advisors--specifically those with the CFP or or PFS designations--because as far as I'm aware, those are the ONLY advisors who are legally and ethically bound to the 'fiduciary' standard, meaning they have to make decisions in YOUR best interest.

They voluntarily put themselves through extra hoops [in time, effort, and expense] to achieve and maintain those designations, as well as subjecting themselves to additional penalty if they DON'T make decisions in the client's best interest. Paul Merriman explains it pretty thoroughly on p. 60 of "101 Investment Decisions."

Understood, and thank you for the advice. I guess I would have to set as "hiring criteria" something like "must be a Canadian citizen or having been lived in Canada for a while, or consulting for Canadian companies"

[...] knowledge on the matter of citizenship/immigration/dealing with foreign assets. Since I have none, other than investing (through a U.S. company) in some mutual funds that hold international stock, I definitely bow to your expertise on the matter.
I just wanted to provide some pointers and resources for you to consider.

No problem at all - it's always good to get a perspective on things from multiple angles.

FroogalStoodent, thank you again for the great advice!