34 year old: Need ideas to start investing

Intel uQfk14
Nov 2 47 Comments

420k total family TC which includes combined ~40k stock comp every year; couple with 11yoe; a home that has almost doubled in value in the last 7 years(1.2m value now); 401k (maxed each year) invested in a standard 2045 retirement plan.

My major regret of late is, as a household we have not taken any other steps to generate returns from our earnings and improve our net worth. We tend to be very conservative investors(despite being aware of multiple investment vehicles) with not much risk appetite or a solid network to follow/copy from; ever since 2014 the market seemed to have hit a peak per our bearish sentiments leading to not much investment efforts(foolish i know; hindsight is 20:20). We have about 500k in cash, which I finally want to invest for return since I feel so much regret.

What are some stocks or investment picks blinders feel bullish about? I am not troll posting. Just sincerely some one who has had a wake up call and looking for advise. Spouse is not keen about hiring financial advisor.

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TOP 47 Comments
  • New / Data
    LNBk35

    New Data

    PRE
    Google
    LNBk35more
    You have not learned anything yet. If you’re chasing risk and return out of regret you’re better off parking the money in a fund with higher risk tolerance and is wel diversified. Give it to wealthfront.
    Nov 2 1
    • Intel uQfk14
      OP
      Have you tried wealthfront? Can you share how you split your funds and what % returns you have been able to get over last few years?
      Nov 3
  • Qualcomm qwopikins
    Vanguard ETFs

    And then risk some shit on options
    Nov 2 5
    • Google wqIe83
      Don't do options if you are a newbie investor. Leave it to the pros.
      Nov 2
    • Micro Focus / Product GWOz11
      The people on r/wallstreetbets?
      Nov 2
    • HPE / R&D
      Ingenieur

      HPE R&D

      PRE
      Amazon, Microsoft
      Ingenieurmore
      There are high, medium, low risk ETFs
      Nov 3
    • Intel uQfk14
      OP
      Any examples you can provide so I can research further? How does one typically classify an etf as high, medium or low risk?
      Nov 3
    • Qualcomm qwopikins
      ETF is inherently diversified but into categories/fields. Id say it’s always medium
      Nov 3
  • Intel ndky
    One mistake you are already making is to put it in the 2045 retirement fund. That thing has huge cost and loaded with bonds. You don’t need that at this age. I would move it slowly (i.e. a percentage per month) to a vanguard ETF.

    There is also some good advice above
    Nov 2 3
    • Facebook an0nymouse
      Disagree. If OP is risk averse enough to hold 500k in cash, the next recession he’s going to panic sell all his stocks if his allocation is too high.

      An all stock portfolio only makes sense for people who have the stomach and understanding to not sell low.
      Nov 2
    • Intel ndky
      Well, I am trying to tell him to get into some risk given his age. Also, the 2045 fund has a fee almost 1.5 percent afaik. That is killing his returns bigly (to quote a stable genius).
      Nov 3
    • Intel uQfk14
      OP
      I will look into the fee I am paying. I have never checked this out.
      Nov 3
  • Elsevier / Product EoxS15
    "Rule No. 1: Never lose money. Rule No. 2: Never forget rule No. 1." Buffett

    Till you figure out what to do. Park the cash in multiple bank short term CD's ( Good ones which will not go bottoms up)

    Read a lot and develop patience for investing, find a good advisor who is not promising you absurd returns and take every advice with a pinch of salt

    If you still don't understand things said by any advisor, do a gradually increasing SIP in S&P500 index funds and forget everything else.

    Plan for retirement and get an attorney for distribution of wealth amongst kids/family members.
    Nov 2 1
    • Intel uQfk14
      OP
      Currently funds are parked in banks generating ~2% return. We have an estate plan and will completed also.
      Nov 2
  • Microsoft
    Tier 1

    Microsoft

    BIO
    #1 in Prestige
    Tier 1more
    Keep 3-6 months of expenses in cash.

    From what’s left, move (most) it *slowly* in fixed dollar amounts per week/month (not fixed share amounts) to an index fund. You want an index fund with low fees, and ideally something that covers the entire stock market.

    With what’s left, say $5000 or $10k at most, put it in a Robinhood account and learn to trade yourself.

    No options, even in Robinhood. You’re too new.
    Nov 2 0
  • E*Trade / Finance cbEV72
    You can’t have a view on markets any more than have a view on inflationary universe theories. I don’t know where people source their arrogance when it comes to investing. You’re reaping the fruits of it. You have enough money to seek pro advice or simply sit passively on 60/40 etf split
    Nov 2 3
    • Compass HWV39
      Wow, an arrogant comment from an Etrade employee. Have you not see your comment commercials? They tend to help fuel arrogance.

      Here’s one dumbass.

      https://m.youtube.com/watch?v=WgmJ_ivEVvw
      Nov 3
    • E*Trade / Finance cbEV72
      I don’t make commercials. Actually I don’t even watch them at all but I’ll trust your assessment. I didn’t say you don’t trade, that’s a generally great idea for everyone to trade. However to simply pull out of market and sit on cash is ridiculous that’s the view. If you believe nvidia is going down and short them it’s a different thing altogether.
      Nov 3
    • Compass HWV39
      You stated you don’t know where people source their arrogance when it comes to trading. I’ve provided one of many examples by etrade. This is representative of the marketing for the industry as a whole. An egregious one in my opinion.
      Nov 3
  • New / Mgmt lHAU26
    Betterment or Wealthfront sounds like an option for you. Lots of options based on the risk you want to take.
    Nov 2 2
    • Intel uQfk14
      OP
      Have you tried them out? Can you share how you split your funds and what % returns you have been able to get over last few years?
      Nov 3
    • New / Mgmt lHAU26
      I’ve been using Betterment for about 2 years now. I like that they take care of the rebalancing and tax harvesting as you add money to it.

      Both of these companies are using ETFs to do their investing. So could you do this yourself, absolutely. But this is hands off and I don’t have to worry about it. They use all the top ETF players like Vanguard and Schwab. Returns have matches up with a lot of other places. Just this past year we are seeing a lot of ups and downs due to the trade agreements.
      Nov 3
  • Microsoft Slurm!
    Index fund ETFs. The market is a bit pricey right now, so build your position over time using dollar cost averaging. I like VTI and VWO.
    Nov 3 1
    • Intel uQfk14
      OP
      Thank you. I’ll check out vti and vwo
      Nov 3
  • JUUL Newboo
    Buy an investment property and rent it out. Cash flow will cover mortgage plus expenses. Helps to diversify and set some aside for investment accounts where index funds could be your starter bets. Couple of fin advisors will help structure portfolio with 100k initial investment.
    Nov 2 1
    • Intel uQfk14
      OP
      What is a reasonable advisor fee? I live in Bay Area. Not sure if I can buy an investment property w/ cash flow which can cover mortgage.
      Nov 3
  • Intuitive Surgical maakasaki
    Start reading more and more. Start with book intelligent investor then eventually make two funds
    1. Investment Account
    2. Speculative Account or Trading

    Read more and evaluate your character with money. Investing is more of a trait of character than IQ. Read about compounding, dollar-cost averaging, mutual funds, index funds, bonds.
    Differentiate yourself and figure out who you want to be?

    Passive investor, Enterprise investor or Intelligent Speculator or Gamblor. What you learn by reading, acquire knowledge via speculative account (trading) all those mistakes, should not be repeated in investing account.

    Eventually you will mature more and become smarter. Ignore other shit here.

    ON
    Nov 3 0
  • IBM pzEt77
    Wait for stocks price to drop, recession is coming. Dont invest anything now unless you know what you doing. You can find alot of high value stocks and properties at a great discount later.
    Nov 2 0
  • Apple AirpodsPro
    Same boat. I too regret for not starting to invest earlier especially considering the long bull market last few years. Bought my home all cash that felt good as the money was put to use in a proper way. I have $500K in vested RSUs (AAPL) which I’m slowly liquidating it (DCA selling) and parking the cash in Wealthfront/Betterment — $150K so far. I’m waiting for the recession or at least some dips to get started with DCA onto VIT ETF. If recession kicks in, I’m planning DCA some amounts into MSFT, AMZN, COST, WMT, and other reputed solid stocks and majority with VIT EFT. I’m also planning to go 70/30 with Bonds/REIT in 401k as taxable accounts will be all stocks/stock index ETF. Just don’t start investing in regret.
    Nov 2 2
    • Intel uQfk14
      OP
      Wow!! Kudos ..buying an all cash home in this Bay Area market... just curious..how were you able to pull it off without stock investments?
      Nov 3
    • Apple AirpodsPro
      Moved to Austin earlier this year. It’s part of work relocation. SFH in the north Austin close to Apple’s office are priced around $400-$500.
      Nov 3
  • New / Mgmt facebooo
    I like to dabble with really risky investments on SeedInvest or Syndicates on Angel.co or Republic. As you know most startups fail and I have yet to see any positive returns, but investing $100k on founders I like and believe in is satisfying on so many levels.
    Nov 2 2
    • Cruise Automation gasp
      What's your net worth, that you're able to use 100k as feel-good money?
      Nov 2
    • New / Mgmt facebooo
      I am late thirties so it accumulated over time (started with $60 in college debt and $50k TC out of college). Net-worth $2M mortgage paid off. So why not?
      Nov 2
  • Microsoft Slurm!
    If you haven't already funded 529s for your kids and HSAs for your family, consider that as well. Roth IRA backdoor is a good thing to max out as well.
    Nov 3 1
    • Intel uQfk14
      OP
      After tax 401k-> Roth Backdoor is something we started just this year. I have <20k hsa dollars invested.
      Nov 3
  • Taylor Farms azerty_
    Get a fiduciary. Trust me
    Nov 2 1
    • Intel uQfk14
      OP
      Is Fiduciary someone who doesn’t push their firm’s products for your portfolio ? What is a typical fiduciary’s annual charges?we spoke with one from personal capital. They charge 0.89% of the portfolio they manage. Did not go with them..
      Nov 2
  • Rakuten / Ops
    tooQ10

    Rakuten Ops

    PRE
    Rakuten USA
    BIO
    Obligatory: YoE 20, TC 41k. Such is life for us non-SWE office monkeys!
    tooQ10more
    Dollar cost average your cash into index funds and bond funds 5% or so per month until you have about 80% of your cash invested.

    Investing it all in one huge chunk exposes you to the risk of a huge crash in the next year or so.
    Nov 2 0
  • Google Krepton
    Make sure to DCA over a year or so. Don’t dump it all at once unless return is guaranteed (e.g. high interest bank accounts)
    Nov 2 0
  • Microsoft / Product
    Brazuka

    Microsoft Product

    PRE
    Bain & Company
    Brazukamore
    Index etf to start. Then after you get comfortable with the volatility of it then you can put come on sector etf and then ultimately on selected stocks. Avoid stocks with low institutional investor% though
    Nov 2 3
    • Intel uQfk14
      OP
      What does stock with low institutional investor % mean? Any examples?
      Nov 3
    • Microsoft / Product
      Brazuka

      Microsoft Product

      PRE
      Bain & Company
      Brazukamore
      Stocks that large funds don't trust and hence don't buy atm. Uber, Lyft are a couple examples. Blue chip companies like Microsoft or FAANG have 70%+ ownership by institutional investors.
      Nov 3
    • Intel uQfk14
      OP
      Thank you
      Nov 3
  • LinkedIn rintintint
    The right way to do it is to dollar-cost-average into 3-fund portfolio plus small-cap-value fund, and then buy and hold. Read Bogleheads wiki and www.firetobiz.com/investing-basics for more details on the funds.
    Nov 3 0
  • Amazon
    BdNinja😎😜

    Amazon

    PRE
    Microsoft, Oracle
    BdNinja😎😜more
    I started financial coaching recently and taking first 10 for free for a year. If you are interested DM me.
    Nov 2 0

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