Author Topic: What to do with $18,000 cash windfall?  (Read 1208 times)

Fuperw84

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What to do with $18,000 cash windfall?
« on: September 29, 2021, 07:25:37 AM »
I just received an $18k windfall. Should I pay off my car $11,200 remaining and another debt at 10% interest? or Should I invest? I'm thinking about putting the money in 5 different biotech stocks. I have extensive knowledge with biotech investment and looking to spread out with biotech stocks under $5. This sector is very beaten down and I will be buying at the low.

Ramparts

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Re: What to do with $18,000 cash windfall?
« Reply #1 on: September 29, 2021, 07:32:36 AM »
Hard to believe in one of the biggest bull market in history, I have lost $117k in the last 3 years investing in high risk oil and biotech stocks. I am disgusted with myself everytime I think about how much I've lost. I still owe $153k in student loans and $110k in Mortgage.

Maybe it would be wise to re-read your own posting history and reflect.

Dicey

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Re: What to do with $18,000 cash windfall?
« Reply #2 on: September 29, 2021, 07:53:02 AM »
Good tip, @Ramparts! This dude's been here for almost five years (Dec. 2017) and seems to have learned nothing. At that time they said they were earning $120k and had $190k in student debt, with a 2020 payoff goal.

I'm currently trying to focus on paying off $11,000 credit card debts. I recently sold all my stocks but having hard time withdrawing money from Fidelity and Robinhood account. I'm struggling to resist temptations to continue trading. I've lost about $120,000 in stock market since i started investing in 2015. I'm determined to stop trading but having problem staying away from watching stock market. I wake up 6am and watch CNBC until Jim Cramer show ends at 7pm. I go on stockwits all day to chat and also on Yahoo message board. I really want to separate myself completely from stock market and focus on paying down debts and enjoying other aspects of life. Without watching stocks on TV and internet, I feel my life has no meaning and i'm really bored. Does anyone have a suggestion on how to get away from this obsession with following stock market all day?
Some people ask for help with no intention of doing the work. Moving along, nothing to see here.

talltexan

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Re: What to do with $18,000 cash windfall?
« Reply #3 on: September 29, 2021, 08:19:42 AM »
@Fuperw84 , if it were me, I'd want to finish off the high interest debt ASAP. As far as what remains, I'd buy a high-yield fund, something like $QYLD that sells covered calls on the NASDAQ (there's a nice fund that sells SP covered calls, too). Then use the dividends from that each month to buy options on the biotech stocks.

If you get a big score, use it to build up the $QYLD nut, so that the dividends will allow for bigger bets as you continue your stock studies. Your goal is to use the cash flow to put up a financial boundary for this trading so that you stay out of debt.

FINate

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Re: What to do with $18,000 cash windfall?
« Reply #4 on: September 29, 2021, 08:35:54 AM »
What they said^

@Fuperw84, you don't have good stock/industry picking instincts. Nothing personal, almost no one does, including me.

Pay off the 10% debt. If the car loan is north of about 5% then pay it off. Put the remaining in VTSAX/VTI and don't touch it.

Morning Glory

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Re: What to do with $18,000 cash windfall?
« Reply #5 on: September 29, 2021, 08:49:51 AM »
Pay off the debt then use the rest of the money to get some counseling. You will be working until you are 80 if you continue gambling with high risk penny stocks.  I think you already know this, the same way that smokers know that smoking is bad for them.  I don't know if you have a spouse or partner but if you have one maybe they could manage the investments, so you can go "cold turkey."   I don't know a lot about how to overcome this addiction but there are therapists who are trained in these matters. Please see one, instead of using your windfall to try for "one big win".

RWD

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Re: What to do with $18,000 cash windfall?
« Reply #6 on: September 29, 2021, 09:19:02 AM »
Investment Order.

You should start with your highest interest debt. Then reflect on the habits that have created your current circumstances...

theoverlook

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Re: What to do with $18,000 cash windfall?
« Reply #7 on: September 30, 2021, 06:39:02 AM »
I'm sitting here wondering how a $120,000/year earner ends up in a situation where $18,000 is considered a windfall.

Fuperw84

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Re: What to do with $18,000 cash windfall?
« Reply #8 on: September 30, 2021, 09:01:08 AM »
I earn alot buy also have alot of debts to payoff including student loans, 2 houses and 4 cars. My salary actually climbed up to $180,000 annually. I came to my senses and decided to put all that money towards debts. No using a single dollar for stocks. Thank you for making me come to my senses. I read all the replies and these helped me to resist the temptation to "get rich" fast.

talltexan

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Re: What to do with $18,000 cash windfall?
« Reply #9 on: September 30, 2021, 09:03:19 AM »
@Fuperw84 , you deserve credit for growing your income by 50%.

We're in this together, looking forward to a brighter future with less encumbrance of debt.

ChpBstrd

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Re: What to do with $18,000 cash windfall?
« Reply #10 on: September 30, 2021, 09:09:20 AM »
Can we get a sticky on the subject of what to do with a windfall? The subject arises every two weeks or so.

This particular one is unusual because OP has the option to earn a risk-free return of 10% and is somehow considering gambling on biotech stocks instead. OP, take the 10%.

RWD

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Re: What to do with $18,000 cash windfall?
« Reply #11 on: September 30, 2021, 09:37:55 AM »
Can we get a sticky on the subject of what to do with a windfall? The subject arises every two weeks or so.

The Investment Order thread is already stickied, which is basically the same thing.

frugalnacho

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Re: What to do with $18,000 cash windfall?
« Reply #12 on: September 30, 2021, 10:07:28 AM »
I earn alot buy also have alot of debts to payoff including student loans, 2 houses and 4 cars. My salary actually climbed up to $180,000 annually. I came to my senses and decided to put all that money towards debts. No using a single dollar for stocks. Thank you for making me come to my senses. I read all the replies and these helped me to resist the temptation to "get rich" fast.

You make $180k/yr.  You are already getting rich fast. Just stick with the plan of paying off debt, lowering your expenses, and saving the excess in index funds.  I make half your salary and I'm raising a family and absolutely crushing it.

ChpBstrd

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Re: What to do with $18,000 cash windfall?
« Reply #13 on: October 01, 2021, 08:15:22 AM »
Can we get a sticky on the subject of what to do with a windfall? The subject arises every two weeks or so.

The Investment Order thread is already stickied, which is basically the same thing.

Unfortunately thatís not working. People donít read the title of that thread as the answer to what to do with a windfall. They perceive the windfall as in its own category separate from their other assets because of the way it arrived in their possession. This is a form of magical thinking. Cash is cash, regardless of its origins, and asset allocation is based on investment objectives, not keeping money of different origins segregated forever for no particular reason. Perhaps thatís what the sticky should say.

This and ďhow to buy a carĒ keep coming up.

Rockies

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Re: What to do with $18,000 cash windfall?
« Reply #14 on: October 01, 2021, 08:46:51 AM »
To the OP - the people mentioning you need counselling/help are correct. I dont mean that in a derogatory sense or to be mean, but it appears you have addictive traits and your life will not be stable or pleasant until you can get this sorted. You will never come out ahead until you can get treatment for this. Spend time focusing on yourself and it will pay off in the long run. It might not be an easy road, but you can get there.

Your only goal is to put all your money into a 80/20 total market stock/aggregate bond fund (or something similar) and NOT TOUCH IT for at least 5 years. If you cant do that then you need to continue to work on yourself.