I'm saving to buy a home. Income is $160k, student debt $45k at <3% interest.
I'm sitting on $30k in my savings account. I wanted to open a vanguard index fund account but was expecting a shemitah disaster because I believed the retards on pol.
What would you do in my situation? I want to put down $80k on the house. Won't need the $30k until 2017. We're capable of saving about $3k or $4k a month but work is less stable than in most industries (could get fired and forced to move to another city on short notice) and we have kids
Worth the risk right now? The market looks like a2008 bubble to me and I don't want to get fucked on the house or a general market crash on an index fund
Please forgive any stupidity I may be revealing, I a
Design and IT. The design job brings the money but the work is mostly in LA and NYC which we aren't in. We'd have to pack up and move if that job fell off, which will probably happen in the next ten years
Yes I'm dumb for believing shemitah but fed rates at zero for seven years.... The market looks like it's going to implode to me
DO NOT PAY 3% debt. Inflation is higher, min payments forever for max gains. Only reason to pay it off is to get access to significant discounts on other much larger financing by manipulating your debt to equity ratio. But that's a very big stretch.
And with income based repayment even if you lose your job, you can minimize payments until you're settled.
As far as the stock market is concerned, don't invest in ANYTHING you don't understand.
Rule#1. Take one year with a small amount of money and learn to trade the markets as and improve your market awareness. For starters even the largest crashes in US history only dropped the entire market 50%. Anyone who does this would love an implosion. The shorts are salivating, and the value guys are stacking to strike after the drop.
If that's your chosen investment vehicle.
Small Business is still the best investment vehicle because of spectacular financing and prices related to cashflow as well as tax favoring.
If you've got the chops.
Your irregular income means you need Double the Cash Reserves of a regular employee. Your irregular job situation means that owning a home is probably not in the cards for you until retirement age.
In the meantime as a renter you still need to be stacking like crazy 45% of your income minimum.
That's the reason the homeowners have more money at the end. Because they were forcing themselves to save. If you spend at the same rate you come out way ahead b/c of higher gains. The median folks only make 3% on their homes per decade. At those rates your home doesn't count as even speculative investment but a savings account. And if you've got to move you have to consider transfer fees- 2-3% of gross in and out and that's without an agent.
one caveat is some markets are so fantastic relative to other places even taking account fees
a bubble is going to be based on something much smaller, if anything this time. The housing market is not in a bubble because of the new laws set in place, and people are not able to push trash credit mortgages around as much anymore.
that leaves, power (oil) or biotech. Oil has already burst, financially at lows and biotech doesn't make up much of the stock market.
I am not seeing signs of any bubble, yes there is financial stress in the markets but nothing drastic.
>DO NOT PAY 3% debt. Inflation is higher, min payments forever for max gains. Only reason to pay it off is to get access to significant discounts on other much larger financing by manipulating your debt to equity ratio. But that's a very big stretch.
>And with income based repayment even if you lose your job, you can minimize payments until you're settled.
Can you please expand on all of this?
Hold the cash until the disturbances in the stock market during the year. Just because /pol/ was wrong about September, doesn't mean a crash isn't coming.
If you think the Federal Reserve is going to be able to raise interest rates through the year and not have an impact, you're dead wrong.
Shorting Junk Bonds or going long on stable oil companies would be a good play.