I'm SDM at Amazon, been in USA for 10 years now. I have always hoarded my cash and have been risk averse. Didn't invest in stocks, funds, real estate, 401K, roth IRA, nowhere. I have sold Amazon stocks which I received as RSUs for no good reason. As a result I've accumulated 1.1 million dollars despite good enough TC. I was bright one in academic but didn't pay attention to finance much, assumed stock market is bubble about to burst anytime since 2015, through covid and this year 2024. Whenever I invested in a week or two market crashed by 5-10%, making me nervous, so I got out as soon as I got 1-2% gains. But then been more timid to re-enter. Now people who have worked far less number of years and probably at lower TC, have been successfully able to multiply their savings 3-4x in last few years in stock market, why buying power of my 1 million has become 1/3(if I look at real estate property prices). Again in last few weeks Market has been volatile only this week it irrationally jumped back to new highs. When is the time I should enter and with all global issues such as Ukraine-Russia, China-Taiwan, Israel-Palestine. US government is dumping 100s of billions of $ to fund many wars, I worry they'll penalize American citizen to recover those money. Shall I just hold off another year(sounds similar pattern I have been following since 2015). If I should invest, how should I go about investing. I read dollar cost average, shall I purchase FAANGM Stocks? or S & P or something else? Also if there is any single book which guides about everything about investment in simple words, please recommend. TC: 410K YOE: 11 #investments
DCA into 3-fund portfolio (Bogelheads); DCA on monthly or qtrly cadence (whatever you are comfortable with)
That’s the chad move dude ….. JK, it’s never too late to DCA into VTI, QQQ, SCHD
Thanks
Oh dude…
If I were you, I would hire a financial advisor (or even consult with 2-3 of them to get different recommendations) since it is a huge stockpile of cash. I hope you are at least holding the money in CD or HYSA to offset the inflation and not under your mattress 😅😅😅 Don’t touch the stock market if you are the kind who refreshes the portfolio every minute and panic sells. The market is overextended for sure but no one knows which way it would go from here. It can keep going up or correct 20-30%. No one really knows. I would set aside a percentage (25, 50 whatever) and slowly inject the cash into the market periodically over the next year(s). I would Focus on quality stocks and ETFs like MSFT, GOOG, QQQ, etc , going a bit aggressive on market pullbacks. Also I would not expect to sell and cash out for the next 10-20 years. At least 10. I would Never buy $hit meme stocks. It can make me a millionaire. It can also wipe me out.
its in checking account :(
At the very minimum, you should do HYSA. Takes literally 10 mins to open AMEX HYSA.
I feel like many people will tell you to dca into the market but no one talks about why it works. I frequently hear from people who stay away from market that it is nothing but speculation and bubble. It's actually not true because economy grows, amount of wealth (amount of money) in the market grows. So it's not a bubble or a lottery. Just get in and stay in unless you actually need the money. Broad index funds like people mentioned above are good. I like fzrox and fzilx from fidelity since they are 0 expense. 3 fund portfolio is fine too. Do not invest into individual stocks. If stock goes down you might be forced to sell before you want to and will have to pay taxes. It also requires a lot of attention to manage such portfolios. Also see if you can purchase a home or something since you have a lump sum of cash on your hands. New accumulated cash and leftover - invest. I wish I had a book to recommend to you (I don't) since it is likely you are highly independent person who needs to hear from high authority to actually change your mind.
>”I was bright one in academic but didn't pay attention to finance much” Finance is academic as well, treat it as.
I’d buy dips. Just don’t invest when the market is setting records.
DCA into VTI, VOO and QQQ I was in a similar boat as you back in 2021. Had 200k sitting in checking account. Broke it into 6 deposits and invested over 6 months. That meant buying during 2021 peak. My portfolio was negative for a year, but I diligently kept investing from my paycheck at regular cadence after that. Which meant I also bought the 2022-23 bottom. In 2024 my portfolio shows decent gains and I'm glad I took a leap of faith rather than letting cash rot in checking.
Hi, wondering your logic behind DCA? Lump sum investing has proven to have higher returns.
Helps reduce stress and anxiety. If you have stomach to do lump sum & hold then more power to you