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re: If I'm looking to make a 5% annual return (after tax) by investing in funds...
Posted on 9/13/16 at 10:03 am to FunroePete
Posted on 9/13/16 at 10:03 am to FunroePete
1. I'm asking a question. I don't "seem to think" anything, or else I wouldn't have had the question.
2. I have no debt and will have no debt other than potentially a mortgage. All assets have recently become fully liquid (cash) as I'm in the process of moving.
If I can pay cash for a house, or pay 20% down and mortgage the rest at 3.125% and deduct the mortgage interest, id need to beat 3.125% (or slightly less) after taxes in investing it. I'm just trying to figure how much risk (qualitatively) I'd be taking on in trying to do that.
I'd prefer 4-6% to make it worth the trouble, but admittedly anything above 3.125% makes it worthwhile. I would have thought a diversified portfolio of a few decent funds could achieve that, but I know frick all about it. Hence the question.
2. I have no debt and will have no debt other than potentially a mortgage. All assets have recently become fully liquid (cash) as I'm in the process of moving.
If I can pay cash for a house, or pay 20% down and mortgage the rest at 3.125% and deduct the mortgage interest, id need to beat 3.125% (or slightly less) after taxes in investing it. I'm just trying to figure how much risk (qualitatively) I'd be taking on in trying to do that.
I'd prefer 4-6% to make it worth the trouble, but admittedly anything above 3.125% makes it worthwhile. I would have thought a diversified portfolio of a few decent funds could achieve that, but I know frick all about it. Hence the question.
2
Posted on 9/13/16 at 10:09 am to PenguinNinja
Like I said earlier, an MLP will will yield you around 4-6% yield but that comes with the risk of equities going up and down. My FA put my in a Pimco fund PONCX which yield 6.5% with a 1.5% management fee crap. But it's stable and I like to think of it as a emergency money account since a savings account doesn't earn you anything.
Posted on 9/13/16 at 12:44 pm to PenguinNinja
My recommendation is that given your questions and current knowledge of investing, you'd be best off paying your house off in cash and investing what you can after that. I'm over 90% in equities in what I have in the stock market then I have real estate. I'm young but most importantly I'm comfortable any dips will be times for me to buy and not to freak out. Most are not like that.
What I would do does not always make sense for you or someone else. Can you make more than 5% in equities, absolutely. Is it worth it for someone like you, at this point I'd say no. The problem id predict is you'd be very nervous and pull out at the first sign of a dip. That's a good way to lose money.
What I would do does not always make sense for you or someone else. Can you make more than 5% in equities, absolutely. Is it worth it for someone like you, at this point I'd say no. The problem id predict is you'd be very nervous and pull out at the first sign of a dip. That's a good way to lose money.
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