Buffet also off loading the airline stocks

Interesting, the dow was just under 14k when the OP started this thread.

Personally, still much more firmly in the $M club than I was in 2011. My comp went thru the roof (For me) the last 5yrs.

We're talking Net Worth - correct? Not just assets?

Asking for a friend.

New job this year allowed my wife and I to finish off her student loans and begin saving for a house. 401k is up to company match and we have a nice emergency fund. We hope to buy next year and have a savings plan this year for the down payment and still have some left over disposable income.

I just opened up a roth ira with fidelity and fully funded 2019. I'm thinking of dumping it all in FZROX. I heard REITs but honestly I'm pretty unfamiliar with those, any insight? Wife and I are 29.

2012Ag said:

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New job this year allowed my wife and I to finish off her student loans and begin saving for a house. 401k is up to company match and we have a nice emergency fund. We hope to buy next year and have a savings plan this year for the down payment and still have some left over disposable income.

I just opened up a roth ira with fidelity and fully funded 2019. I'm thinking of dumping it all in FZROX. I heard REITs but honestly I'm pretty unfamiliar with those, any insight? Wife and I are 29.

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That is a total bond index fund. At 29, you should not need a heavy allocation to bonds in your retirement accounts in my opinion. You should be investing for the long term at that age and that means equities.


REITs are like a sector. Probably not a good time to wade into it unfamiliar waters. Probably a good time to think about broad based equity index fund, not so much bonds.

GigEm81 said:

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2012Ag said:

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New job this year allowed my wife and I to finish off her student loans and begin saving for a house. 401k is up to company match and we have a nice emergency fund. We hope to buy next year and have a savings plan this year for the down payment and still have some left over disposable income.

I just opened up a roth ira with fidelity and fully funded 2019. I'm thinking of dumping it all in FZROX. I heard REITs but honestly I'm pretty unfamiliar with those, any insight? Wife and I are 29.

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That is a total bond index fund. At 29, you should not need a heavy allocation to bonds in your retirement accounts in my opinion. You should be investing for the long term at that age and that means equities.


REITs are like a sector. Probably not a good time to wade into it unfamiliar waters. Probably a good time to think about broad based equity index fund, not so much bonds.

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At the expense of sounding like an idiot how can you determine it's a bond index fund? Still learning, getting rid of loans have made this all very exciting.

Based on my age then it would seem FXAIX is a good first route.

I'm pretty sure it's equity not bond that captures total stock market. Personally I like Vanguard's VTI : their total stock market index. But I'm sure it's all the same.

For long term wealth building stay invested, stay investing, and stay allocated to your risk appetite. That means don't try and time the market. Keep investing everything and every time you can. And don't concentrate your risk unless your risk allows you too. An etf like VTI spreads you across the whole market, large cap, mid cap and small cap companies, every sector style (Tech, energy, RE, etc). That will be the easiest and best long term of you don't want to spend too much energy.

100% equity/stock is great for your long term horizon. Just know that it can be a volatile ride. If you and your wife can stomach this ups and downs by not pulling money out but by letting it ride and continuing to invest then you'll be golden. If however a 30% drop like we just saw we make you blow up your plan then it may not be the right course for you.

Congrats on being in such a strong foundational spot for your financial lives! If you have the ability I. Would consider contributing your 2020 contribution to your Roth now and invest over the next month or two. Get it in working for you while stocks are down.

To add to previous post: in regards to REITs you'll capture some real estate in the total market index. But if you wanted a little more exposure you might look at Vanguards or Fidelity's R/E etf. But I wouldn't hold a concentrated position in that. Like up to 5% of your invested assets if you really like them, maybe less. Example: 95% VTI and 5% VNQ. Not saying I recommend that but that's how I would do it.

Anyone playing REITs should read the article below:
https://seekingalpha.com/article/4336305-skin-in-game-matters-ladder-capital

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I talked with Ladder's management on Friday, which said:

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"This is an acute issue because there is no income coming in. Just about every sector is seeing defaults. It's a waiting game, and nobody knows how long or how deep (it will be)."

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It recently provided a liquidity update of having "over $300 million of cash after having just paid its previously announced quarterly cash dividend." And it has met its margin calls in timely manners:

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" the environment has stabilized as margin calls have subsided. We have AAA securities, the last things to default. (But investors should) ignore the screens on stock prices. We believe all of the issues haven't made its way down the capital stack yet."

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Essentially, we're in the early innings with coronavirus-shutdown concerns. There could still be a wave of defaults to come, so it makes complete sense that mREITs are looking for a break.

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Really appreciate your insight.

Question for the thread:

What is the highest price you would pay for a house to live in? What is your personal threshold before saying no.

Just curious to see where others land

I imagine that's very dependent on your net worth, liquid net worth, income, job stability, and housing market. I don't think you can simplify a question as complex as that.

Rice and Fries said:

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Question for the thread:

What is the highest price you would pay for a house to live in? What is your personal threshold before saying no.

Just curious to see where others land

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id pay $1.5MM if I could afford one.

I don't understand your question.

evestor1 said:

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What is the highest price you would pay for a house to live in? What is your personal threshold before saying no.

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I would pay whatever it takes to have a lakehouse...and then i would tear down my neighbors homes and plant trees. I would repeat this for about 5 houses in either direction.

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my man

SoupNazi2001 said:

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Gordo14 said:

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I imagine that's very dependent on your net worth, liquid net worth, income, job stability, and housing market. I don't think you can simplify a question as complex as that.

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The way you could make this question relevant is what % of your current net worth (excluding your primary residence) did you pay for your house.

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Thank you this is what I was striving for, but not all of it:

Basically it's two part question:

1. How much would a houses price be before you are like "no thanks, I'm out". For me, I would have a hard time paying more than $800K-1MM for a house. But I live in the metroplex and can understand that costs are way different in other areas like NYC, SF, LA, DC.

2. How much is that price point you would start shying away from is part of your total NW/Liquidity.

For example: My goal net worth is $5M, so if I am buying a house, I would not want it to make up more than 20% of my total net worth. But If I only have $1.2M NW right now, I can see how much total tolerance would be 50% of my NW.

All that said, my current house is $350K but we want to upgrade in ~5 years and just curious to see if my $800K limit passes the sniff test for a "millionaire next door" type community.

Sorry for the confusion.

evestor1 said:

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Quote:

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What is the highest price you would pay for a house to live in? What is your personal threshold before saying no.

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I would pay whatever it takes to have a lakehouse...and then i would tear down my neighbors homes and plant trees. I would repeat this for about 5 houses in either direction.

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This is where the conversation started with the wife...

Talking about what to improve on our existing house, but then why would we if we want to move.

Move where? Well it would be nice to have primary residence as lake house so I wouldn't feel bad about going on vacations to other places and not using my lake house...Just want that guilt free, getting my total use out of purchases.

But lake houses on Lake Travis or LBJ are a bit pricey by my sniff test.

So where else are you putting your cash? The stock market?

The great house debate is pretty much a weekly occurrence in our household....usually on the weekends once my wife starts perusing the Ebbie Halliday app (Dallas based). She kind of got me addicted to doing it too though.

For us, it's primarily an academic exercise and done out of boredom because we already have a second home on the coast (inherited), but here are the points I keep coming back to on upgrading to a $1M house (for example):

• It's the just two of us and once you start getting into that price range the resulting square footage would be ridiculous for two people. The idea of having to maintain that much house gives me seizures. Our current house is 3,400 and that is really too large for us, but we at least use all of it due to the layout.
• The resulting cost of furniture and crap you would have to buy just to fill it is pointless extravagance.
• Maintenance and utility bills for that house. Oy vey.

Our current struggle is that we would really like to move out of Dallas, but our commutes are awesome and I just don't know if we could survive that trade off. Also, what I would really want is a smaller, one story home that is totally decked out but those types of houses simply don't exist here. We would have to build it or completely gut and renovate an existing home which is also something I have zero desire to do. So, we stay.

YouBet said:

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The great house debate is pretty much a weekly occurrence in our household....usually on the weekends once my wife starts perusing the Ebbie Halliday app (Dallas based). She kind of got me addicted to doing it too though.

For us, it's primarily an academic exercise and done out of boredom because we already have a second home on the coast (inherited), but here are the points I keep coming back to on upgrading to a $1M house (for example):

• It's the just two of us and once you start getting into that price range the resulting square footage would be ridiculous for two people. The idea of having to maintain that much house gives me seizures. Our current house is 3,400 and that is really too large for us, but we at least use all of it due to the layout.
• The resulting cost of furniture and crap you would have to buy just to fill it is pointless extravagance.
• Maintenance and utility bills for that house. Oy vey.

Our current struggle is that we would really like to move out of Dallas, but our commutes are awesome and I just don't know if we could survive that trade off. Also, what I would really want is a smaller, one story home that is totally decked out but those types of houses simply don't exist here. We would have to build it or completely gut and renovate an existing home which is also something I have zero desire to do. So, we stay.

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Do you guys have kids?

My curiosity is that if you did and have two or more, what would your stance be then?

I would feel that somewhere like Fairview and a 4000sf would be perfect if you had two or three kids and you had ~10 years before the first one started falling off to go to college would be good.

2012Ag said:

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GigEm81 said:

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2012Ag said:

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New job this year allowed my wife and I to finish off her student loans and begin saving for a house. 401k is up to company match and we have a nice emergency fund. We hope to buy next year and have a savings plan this year for the down payment and still have some left over disposable income.

I just opened up a roth ira with fidelity and fully funded 2019. I'm thinking of dumping it all in FZROX. I heard REITs but honestly I'm pretty unfamiliar with those, any insight? Wife and I are 29.

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That is a total bond index fund. At 29, you should not need a heavy allocation to bonds in your retirement accounts in my opinion. You should be investing for the long term at that age and that means equities.


REITs are like a sector. Probably not a good time to wade into it unfamiliar waters. Probably a good time to think about broad based equity index fund, not so much bonds.

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At the expense of sounding like an idiot how can you determine it's a bond index fund? Still learning, getting rid of loans have made this all very exciting.

Based on my age then it would seem FXAIX is a good first route.

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Well you can Google the name or symbol, or better yet go the the Morningstar site and there is a lot of objective analysis there.

But I was incorrect on the fund you cited-it is in fact an equity index! Not sure what I was looking at before. Apologies.

But Morningstar is a great resource. No need to subscribe, just register. Lots of free info there.

I love my neighborhood, and the perfect house for my family today would run about $600k, vs my current house at $325k. (Appraisal district values). My oldest is wrapping up her freshman year in hs and hopefully will be off to college in 3 years. Starting at that point , I won't need the 5th bedroom/extra space.

So...the reason we haven't moved, is that house would cost me an extra $10k+ in taxes and insurance. Plus we'd have to build a pool ($80k). So for the three years of extra comfort, I'd be out $110k. I'm good. We will stay here.

Last time we came close to upgrading our home, I bought a farm that is ag exempt and costs very little in annual maintenance. (Monthly nut = $350)

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i would say the millionaire next door would stay in the $350k house forever and no one around him would know he was a millionaire.

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That's us in a $250k home. Really don't care for huge, expensive homes. We're at 2,500 sq. ft. now and if anything will downsize once the kids leave in a few years. Both cars are also over 6 years old and nearing 100k miles (both paid for years ago).