Author Topic: Where to invest in 2018  (Read 3781 times)

cavinvestor

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Where to invest in 2018
« on: January 26, 2018, 04:57:39 PM »
Hey Guys,

I'm a newbie here and really looking for suggestions to invest.  So far I have invested in these

1) Primary residence (Still paying mortgage)
2) Out of state investment property (Rental)
3) 401k (Maxed out)
4) Roth IRA - Robot advisor

I'm looking for short term (<1-2years) investments and I see these options

1) Peer-Peer lending  (Majority are 5+ years)
2) CD - Return is low
3) High interest saving / money market account - (I don't think it is high enough.  I'm looking for atleast 7%)
4) Individual stocks - Need to be upto date with the market always. I have burnt my hand ones in this area and it is like once bitten twice shy.
5) Bitcoin? - Still studying this market.

Is it better to keep the cash and wait for market correction? or invest somewhere?  Any suggestions are highly appreciated.

BigHaus89

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Re: Where to invest in 2018
« Reply #1 on: January 26, 2018, 05:37:37 PM »

Retire-Canada

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Re: Where to invest in 2018
« Reply #2 on: January 26, 2018, 06:28:18 PM »
Short-term from your list the only two that make sense are CD and high interest savings. At best you are trying to keep pace with inflation.
« Last Edit: January 26, 2018, 06:55:11 PM by Retire-Canada »

MrDelane

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Re: Where to invest in 2018
« Reply #3 on: January 26, 2018, 06:49:55 PM »
The OP says they are looking for short term, less than 1-2 year long investments.
Would you all really suggest dumpting it into VTSAX for that short a timeframe?
Seems like an odd choice to me.

At that short a time frame I would say you're looking at a high yield savings, CD or money market as your best options.

Rob_bob

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Re: Where to invest in 2018
« Reply #4 on: January 26, 2018, 08:20:42 PM »
I agree, short term, CD's and high yield checking.  IMO at this time Bitcoin is like going to Vegas, put 'er all on RED!

ysette9

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Re: Where to invest in 2018
« Reply #5 on: January 26, 2018, 08:29:42 PM »
Looking for at least 7% return and a time horizon of 1-2 years are not compatible. You can pick one or the other. If you really need the money that soon, then you need something safe, as others have said. Money market, savings account, CD, maybe a short-term bond fund. The goal isn’t growth but just preservation of capital.

Mighty-Dollar

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Re: Where to invest in 2018
« Reply #6 on: January 27, 2018, 02:31:43 PM »
With such a short time horizon I'd go with this...
https://finance.yahoo.com/quote/VSCGX/profile?p=VSCGX
60% of the fund's assets to bonds and 40% to common stocks. It automatically rebalanced for you.

Mr Mark

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Re: Where to invest in 2018
« Reply #7 on: January 28, 2018, 03:19:36 AM »
Ahhh, the search for a passive, low risk, high return, short term investment never ceases.

This helps explain crypto-fever I guess... No-one wants to believe it doesn't exist. Here are the options you mention.

1) Peer-Peer lending  (Majority are 5+ years)
Lately these have been really terrible investments (see thread on it). High risk, low (or negative) returns. I'd be more tempted to try shorting the stock of Lendingtree instead - yet their stock somehow hit an all time high last week with a PE of 143 (!!), despite paying no dividends and all the indications of a ponzi scheme. Go figure.

2) CD - Return is low
Yes. But better than cash and capital guaranteed by the Gov.

3) High interest saving / money market account - (I don't think it is high enough.  I'm looking for atleast 7%)
Try Russia, Brazil or India.

4) Individual stocks - Need to be upto date with the market always. I have burnt my hand ones in this area and it is like once bitten twice shy.
Just don't.

5) Bitcoin? - Still studying this market
I guess you could call it a market? It's not what most would call an investment tho. Please don't.

So, what to do?
If you want low/zero risk, and need money back in "1-2 years" then CD in a FDIC bank. (don't keep cash as that will lose money)
If you want some risk, liquid, but pretty safe over 2 years, Vanguard Wellesley Fund [60% Bonds/40% equity]
If you just want a solid guaranteed return, simply pay down your mortgage.

smallstache

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Re: Where to invest in 2018
« Reply #8 on: January 28, 2018, 06:04:47 AM »
What OP is looking for doesn't exist.

thunderball

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Re: Where to invest in 2018
« Reply #9 on: January 28, 2018, 09:55:40 AM »
+1 above 2 posts!

Car Jack

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Re: Where to invest in 2018
« Reply #10 on: January 28, 2018, 10:44:28 AM »
Mr. Mark hit it as far as I'm concerned.  Look into an Ablebanking CD (Northeast Bank).  I just opened a HYSA with them for 1.7% and only really looked at their 2% 1 year.

1) Peer-Peer lending  (Majority are 5+ years)  read the Mr Money Mustache blog and spread sheet.  You're too late.  They're going down the toilet

2) CD - Return is low  2% at ablebanking.com

3) High interest saving / money market account - (I don't think it is high enough.  I'm looking for atleast 7%)  and I'm looking to become a supermodel astronaut.  Good luck with that

4) Individual stocks - Need to be upto date with the market always. I have burnt my hand ones in this area and it is like once bitten twice shy.  Risk.  You could make 20% or you could lose 20%

5) Bitcoin? - Still studying this market.  Just set your money on fire.  It'll take less time and probably cost you less

aspiringnomad

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Re: Where to invest in 2018
« Reply #11 on: January 28, 2018, 02:43:52 PM »

1) Peer-Peer lending  (Majority are 5+ years)
Lately these have been really terrible investments (see thread on it). High risk, low (or negative) returns. I'd be more tempted to try shorting the stock of Lendingtree instead - yet their stock somehow hit an all time high last week with a PE of 143 (!!), despite paying no dividends and all the indications of a ponzi scheme. Go figure.


I think you meant to post and look up the ticker for LendingClub, not LendingTree which offers a very different service. LendingClub's stock is definitely not at an all-time high, but hovers near an all-time low.

midwesterner1982

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Re: Where to invest in 2018
« Reply #12 on: January 29, 2018, 04:21:22 AM »
If you want low/zero risk, and need money back in "1-2 years" then CD in a FDIC bank. (don't keep cash as that will lose money)
If you want some risk, liquid, but pretty safe over 2 years, Vanguard Wellesley Fund [60% Bonds/40% equity]
If you just want a solid guaranteed return, simply pay down your mortgage.

If you absolutely need the $ to be there in 1-2 years, I'd go with Mr Mark's and Car Jack's recommendations for a CD or a High Interest Savings Account/money market account.

For my own emergency/opportunity funds I use these two strategies:
1) If you need to hold X dollars for a future opportunity or as an emergency fund, go ahead and invest X + 30% in mutual funds like VTSAX.  So if you needed to hold onto $15,000, you would invest $19,500 as cushion against a downturn.  The theory is that greater than 30% drops are so rare you'd more than likely be okay.  If a downturn never happened you'd make a great return on your money (remember to set some aside for capital gains tax). (I can't remember the source of this strategy, probably here at MMM?)

2) How about putting the money in VTI (the ETF equivalent of VTSAX) and setting a stop-limit?  Not foolproof because of potential to gap down below your limit but if that happened to me I'd probably buy more!  A mutual fund like VTSAX executes at the end of the day and you trade in $ amounts so you can buy partial shares which makes it convenient and easy to add to your stache.  An ETF executes in the open market like a stock but you must buy and sell in whole shares.

Cubert

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Re: Where to invest in 2018
« Reply #13 on: January 29, 2018, 04:47:49 AM »
I would avoid the urge to splurge on any short term investments unless you're absolutely certain you can manage the risk. The chart posted earlier is a handy guide.

Avoid BitCoin and Peer to Peer Lending. It's hard to liquidate the P2P stuff, and the yield takes a big hit after year 1 for some reason. You might get 5% steadily there, but I think there's better options.

How big is your house? Could you consider converting a room or space into an Airbnb option?
[/b][/b]

cavinvestor

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Re: Where to invest in 2018
« Reply #14 on: January 29, 2018, 11:37:31 AM »
@Cubert
How big is your house? Could you consider converting a room or space into an Airbnb option?[/b][/b]

Not big enough to do Airbnb.  So that option is ruled out.

@all

Thank you so much.  My wife and I are used to keeping cash in normal savings account (for rainy day fund) and it really seems not a good idea.  I'll move the rainy day funds to CD and the rest of the cash into VTI / VTSAX / VSCGX. 

Mr Mark

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Re: Where to invest in 2018
« Reply #15 on: January 29, 2018, 11:04:42 PM »

1) Peer-Peer lending  (Majority are 5+ years)
Lately these have been really terrible investments (see thread on it). High risk, low (or negative) returns. I'd be more tempted to try shorting the stock of Lendingtree instead - yet their stock somehow hit an all time high last week with a PE of 143 (!!), despite paying no dividends and all the indications of a ponzi scheme. Go figure.


I think you meant to post and look up the ticker for LendingClub, not LendingTree which offers a very different service. LendingClub's stock is definitely not at an all-time high, but hovers near an all-time low.

Thanks for picking that up - You're right - I was thinking of Lending Club [LC.N] not Lending Tree [TREE]! :-/