Episode #125 of the Stack Overflow podcast is here. We talk Tilde Club and mechanical keyboards. Listen now
68

A few points. You may be interested in this website which helps you calculate the total cost of car ownership, and factors in things like insurance, gas, mileage, repairs, registration, etc... These costs are not inconsequential and have a tendency to add up. Even this calculator doesn't consider all the costs though because it ignores the lost opportunity ...


41

No doubt about it: vehicles are capital expenditures which depreciate over time. Referring to a car as "a good investment" because it hasn't depreciated very much is metaphorical. Having said that, the exception that proves the rule are low-supply, high-demand antique and specialty cars.


21

Beware confirmation bias I have been reading a lot and doing as much research as I could and need some help to decide whether I could consider the action of buying a car as an investment. Oh, you have to be very careful here, of confirmation bias. Deciding which conclusion you want to reach, and then searching for the facts that support reaching that ...


10

I may be focusing on just the words here, but "Investment" has a particular meaning. In the real world, my wife has used phrases like "I need to invest in a new pair of shoes". I suppress the urge to shout that routine purchases like this are not investments, they are just purchases. But, I keep my mouth shut, as she needed new shoes. I bought a treadmill. ...


5

In large part answer here is that there is no reason to rely on the numbers presented in an article about buying life insurance where the word underwriting doesn't even appear written by a random person for a blog that exists for click revenue. That being said the issue here isn't that the premium is more like $800 per month, the answer that it is pretty ...


5

There’s no standard for early redemption penalties. Some mortgages have them and some don’t — read the small print of any mortgage you are thinking about applying for. But in general, avoid fixed-rate mortgages and go for floating rates, which are much less likely to have redemption penalties.


5

If you hold a joint account with another person, the limit would be double, as the limit applies per person. There is also a higher limit for temporary balances following a life event (such as following a house sale). Please be aware that the limit is per person, not per account, so there is no way around it by having multiple accounts. The limit is also ...


5

No car purchased to get you from A to B can be considered an investment. All cars depreciate as soon as they are driven. Only collectible or show cars can be investments because they are rare or unique, not driven (accumulate no wear), and make some sort of artistic and/or historical statement. For any car you would routinely drive, the best you can hope ...


5

Cars are only good investments in certain cases. Brand new cars As little time as they take to maintain, they depreciate as soon as you sign the loan papers. They will also continue to depreciate rapidly over the first 5 years or so. Also, when they do break down, the repairs are likely to be more expensive. Insurance and registration is going to be high ...


5

You've stopped the drawdown projection after 15 years, but you could easily live longer than that, and in just a few more years you'd run out of money. Your initial withdrawal rate of >7% is very high. You haven't considered the need to grow your withdrawals with inflation. As a result of the above, most people cannot rely purely on "conservative portfolios" ...


4

Read JL Collins stock series. Part 10 provides a good explanation of why a large regulated brokerage that tracks an index can't crash. "1. You are not investing in Vanguard, you are investing in one or more of the mutual funds it manages. The Vanguard mutual funds are held as separate entities. Their assets are separate from Vanguard, they each carry ...


3

No, You cannot enter any order without the risk of the order getting executed. In my humble opinion, the fault resides with those who read and look at the order books and then take advantage. But the general public loves a hanging, and I fully agree, This article is by a similar sounding name.


3

It's useful to be aware that NS&I (National Savings and Investments) has no limit on protection. It's basically a state-owned savings bank and therefore in theory as low-risk (with regard to default) as government issued bonds ("gilts" in the UK) which are generally considered the "minimum risk asset". NS&I's website doesn't seem to go into any ...


3

If something happens to the mutual fund and it crashes, you lose everything. Theoretically, yes, but the point of diversification is that the odds of ALL of the underlying stocks going to zero is infinitesimal. Certainly there can be large economy-wide crashes, which is why you can further diversify into multiple mutual funds covering different markets (...


3

The standard Keep It Simple recommendation is a Total Stock Market Index Fund, a Total International Stock Index Fund and a Total Bond Market Fund. https://www.bogleheads.org/wiki/Three-fund_portfolio If your brokerage doesn't offer them, or don't trust the volatility of emerging market stocks, etc, etc, then an S&P 500 index fund and a high grade ...


3

Nobody; or at least, no individual counterparty. Let’s use (mostly) @Michael’s labels of borrowing securities from beneficial owner A via broker B, sell high to C and buy back low from D. Note that in this answer, B refers to the broker rather than the borrower. A: starts with the securities and ends with the same. The broker makes good if A wants to trade ...


2

If something happens to the mutual fund and it crashes, you lose everything. Nothing will happen to the mutual fund that doesn't also happen to the underlying index. What might happen is that the brokerage goes bankrupt or collapses due to some malfeasance. The SIPC should pick up the pieces after you, but that will take time. Better to just invest with ...


2

In Canada only TFSAs and RRSPs are tax efficient in the sense that they allow you to forgo paying taxes on dividends and capital gains (TFSAs), or defer paying taxes until a later time (RRSPs). Any major bank will be able to set up an investment account for you where you can buy/sell/trade US equities. You will have to pay capital gains taxes on any ...


2

The deaths are not evenly distributed over the 20 years. The earlier years have lower probability of death and some may stop paying. For example someone might stop paying at age 70 and then die at 75.


2

Don't time the market Every time there's some risk that could cause stocks to halve (or lose more of) their value. Most of the time, it won't happen. I'm sure you won't find any period where negative news don't exist. You just need to learn to ignore negative news. Instead, invest as much into stocks as you are comfortable Stocks yield more than bonds. In ...


2

There are 3 main arguments for why you should concentrate your investments in the US rather than holding international funds, they are covered in greater detail here. But broadly speaking they boil down to: Added risk - currency risks and a lower level of transparency in relation in the market tend to make international funds riskier investments. The US has ...


1

I understand that the bank essentially buys from me an insurance against a catastrophic market failure, but are they paying me the right price for it? E.g. how does this product compare to a pure uncapped investment in the same index? The easy part of your question to answer is that there is no comparison of this product to a pure uncapped investment in ...


1

I think you're misunderstanding what Singh did. Singh entered orders which he intended (in other words, he planned, or he wanted) to cancel before those orders executed. And he was successful; he did cancel the orders before they executed. But if the orders had executed, he would not have been able to cancel them. You seem to think that Singh canceled ...


1

In addition to the points you raised, you should also consider that most (if not all) Indian mutual funds will not accept investments from an individual living in the US, because of IRS reporting regulations


1

I like to follow the mantra of "give some, spend some, save some". It helps one decide no matter how much extra there is, or if this is extra being made over time or a lump sum. In your case, you are citing a range of 30K, which could buy a pretty nice new car. So I would give some, and lean towards 10%. This can be spread across several charities or one ...


1

As many as you need for global coverage. It is a big mistake to invest in one market, e.g. just US stocks (recently, US stocks have become so expensive that I might even recommend smaller than ordinary weight for US stocks). Many index funds do precisely that, and are intended not to be your full portfolio, but rather be a part of a well-diversified ...


1

You're not missing anything obvious, but I would reduce the amount that you need to live somewhat. Your fictitious income is 60k (15% of 60k is 9k). You're contributing $9k to a 401k. You're calculating the money you need based on that 60k income to be 60k as if you were continuing the contributions after retirement. You should either include those 9k in ...


1

Between the time the borrowed shares (say N shares) are sold and the time they are bought to cover, the number of long shares held by other investors is N greater than it would be "otherwise" -- i.e., than it would be in the baseline scenario where the short wasn't performed. Which investors exactly (as a function of time) hold the "extra" N shares is a ...


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