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How do I fix this mistake?
Posted on 1/26/13 at 9:42 am
Posted on 1/26/13 at 9:42 am
I rolled the majority of my ROTH and regular IRA's from stocks to MMA last Spring, anticipating a drop in the market. We all know how that worked. At least being in an IRA I didn't pay capital gains.
I guess I need to roll back in.This is money I won't need for 30 years. My plan was to dollar cost average the whole works back into stock index funds over the next 4 months. Comments? Suggestions? Do you have a better idea?
I guess I need to roll back in.This is money I won't need for 30 years. My plan was to dollar cost average the whole works back into stock index funds over the next 4 months. Comments? Suggestions? Do you have a better idea?
6
Posted on 1/26/13 at 10:04 am to Cold Pizza
quote:
My plan was to dollar cost average the whole works back into stock index funds over the next 4 months. Comments? Suggestions?
Why not just dump all the money in now if you think it's a good time to buy?
Shouldn't be that tough to diversify with some ETFs and individual stocks in this market
Posted on 1/26/13 at 10:12 am to Cold Pizza
1. Don't try to time the market with your retirement accounts.
2.
Probably your best option at this point.
2.
quote:
My plan was to dollar cost average the whole works back into stock index funds over the next 4 months
Probably your best option at this point.
Posted on 1/26/13 at 6:53 pm to Chris Farley
DCA is the best way. Just don't look at it everyday or you'll drive yourself crazy. Maybe rebalance semi annually or annually.
Posted on 1/27/13 at 1:18 am to Cold Pizza
Don't DCA a lump sum.
Posted on 1/27/13 at 1:26 am to Dead Mike
Please explain...
Posted on 1/27/13 at 2:56 am to Cold Pizza
quote:
anticipating a drop in the market.
quote:
This is money I won't need for 30 years.
First off, the market just about has never droped on an election year. So I don't know were you got that idea.
At your age and with 30 years, time is on your side towards investments. Never try to time the market.
Now that the market is high, I would wait out some but not all your moneys. They will be a correction coming soon by next April/May.
Posted on 1/27/13 at 9:22 am to fishfighter
quote:
At your age and with 30 years, time is on your side towards investments. Never try to time the market.
quote:
Now that the market is high, I would wait out some but not all your moneys. They will be a correction coming soon by next April/May.
Does not compute.
Posted on 1/27/13 at 9:31 am to fishfighter
quote:
They will be a correction coming soon by next April/May.
You're sure about this? You know better than 99.999999999999999999% of investors?
Posted on 1/27/13 at 12:11 pm to Cold Pizza
The historical numbers support lump summing the money back in. If it is not a large amount of money I wouldn't worry one way or the other. Poor psychological investing behavior destroys retail investors' performance over time, look at the difference between actual investment returns vs retail investor returns, retail investors will be significantly worse.
You need to determine an allocation that keeps you comfortable longer term, ie 60/40, 50/50, whatever, or you can follow something similar to the Ben Graham 25/75 guideline, ie reduce equity allocation when equity market valuations are high, but never completely exit in case you are wrong (25% floor), which would have kept you from doing what you did in 2012. It's more difficult in taxable, say you have multiple 6-figures in gains on paper, are you going to pull the trigger and pay taxes on that due to feeling overly cautious about the market direction? That's were the investment plan/allocation comes into play, and harvesting losses along the way helps immensely.
You need to determine an allocation that keeps you comfortable longer term, ie 60/40, 50/50, whatever, or you can follow something similar to the Ben Graham 25/75 guideline, ie reduce equity allocation when equity market valuations are high, but never completely exit in case you are wrong (25% floor), which would have kept you from doing what you did in 2012. It's more difficult in taxable, say you have multiple 6-figures in gains on paper, are you going to pull the trigger and pay taxes on that due to feeling overly cautious about the market direction? That's were the investment plan/allocation comes into play, and harvesting losses along the way helps immensely.
Posted on 1/27/13 at 2:44 pm to Cold Pizza
I have never been for timing the market but had a bad feeling. Decided I would try it once and NEVER do it again if I was wrong. Well, I was.
I'm DCA'ing back into my Vanguard Total Stock and Total International Stock over the next 8 weeks.
I'm DCA'ing back into my Vanguard Total Stock and Total International Stock over the next 8 weeks.
Posted on 1/27/13 at 3:04 pm to Cold Pizza
quote:
I'm DCA'ing back into my Vanguard Total Stock and Total International Stock over the next 8 weeks.
Posted on 1/27/13 at 3:07 pm to Cold Pizza
quote:
I have never been for timing the market but had a bad feeling. Decided I would try it once and NEVER do it again if I was wrong. Well, I was.
I'm DCA'ing back into my Vanguard Total Stock and Total International Stock over the next 8 weeks.
Smart decision. I have a friend/mentor who has a net worth of over $60 Million, he told me that "it's not timing the market, it's time in the market" that made him wealthy
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