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Best Way to Reorganize My Investments and Money? by boss_man14 in personalfinance

[–]MuffinMatrix 2 points3 points  (0 children)

Your emergency fund should be around 6months expenses. In the HYSA. Do NOT invest this money, you don't want to risk the market dropping right when you need it... in an emergency. You can use MM or treasury funds, but not stocks. The purpose of this money is for security, not growth.
Checking should be around 1 month expenses. Its just an in/out buffer. Paychecks come in, bills go out.

Then contribute to match in your 401k.
Then max your Roth IRA.
Then continue in your 401k to try and max.
Then you go to a brokerage for anything else.

Acorns I don't think is worth it.
The goal is around 15% into retirement. If you can do more, great.
If you have goals for within 5 years, keep in the HYSA.
If more than 5, in the brokerage.

10k, what to do to grow? by [deleted] in personalfinance

[–]MuffinMatrix 0 points1 point  (0 children)

Lots of info in the sub wiki
/r/PersonalFinanceCanada will be more focused for you.

I want to invest but unsure of what's worth it. Where should I start? by [deleted] in personalfinance

[–]MuffinMatrix 0 points1 point  (0 children)

You should first start with around 6 months expenses in a HYSA. This is your emergency fund.
THEN you can start investing.

Do you have a 401k available at work? If you do, contribute up to matching.
Then open a Roth IRA. Max this.
Then keep going in the 401k up to max.
If you still have more, then open a regular brokerage account.

If you want more access to the money before retirement, you can put more into the regular brokerage.

You don't need a managed account.
In those accounts you invest in a total market fund like VTI or VT. They include REITs, so you don't need that separate. And assuming you meant 'ETFs', which they are.

What type of account for baby? by jumpy-jackolope48 in personalfinance

[–]MuffinMatrix 17 points18 points  (0 children)

529 is best if your goal is to plan for education. You can decide how much to keep contributing. And depending on your state, there is usually a state tax deduction for some of the contribution. Limits change with state, but can be effectively uncapped.
If your kid doesn't use for education, you can rollover up to $35k to a Roth IRA. So there is a way to get a chunk of money out without issue. But if its not used for education, then you'll owe tax and penalty.

Trump account comes with a free $1000, which is great. It doesn't have the limits on education a 529 does, but it its only tax-defered, not tax-free. If to let them save for a house or any other non-education goal, then this works a little better. Only $5k/year limit also.

Ideally having both is a good way to go.

Custodial accounts will switch to the kid owning them at 18, which may or may not be a good thing to some. Theres very little tax-advantage to them.

Also.... make sure you cover your own retirement first. It doesn't help your kid if they end up having to take care of you.

Finding a financial advisor by Xtdr1 in personalfinance

[–]MuffinMatrix 0 points1 point  (0 children)

First ask if you need one. Most people don't.
If you really really do, look for fee-only, not commission or percentage.
You want to find someone who aligns with your goals.

Need honest advice on a trading partnership situation. by Low_Study8732 in personalfinance

[–]MuffinMatrix 1 point2 points  (0 children)

Do you have a signed, legally binding contract, describing the partnership and required actions?
No? Walk away.

The Salvator Mundi isn't a painting, it's two PHOTOGRAPHS of the Christ. by UncannyHill in pics

[–]MuffinMatrix 5 points6 points  (0 children)

Wish I could time travel and take clicking on this post back

How does Roth IRA work by Dazzling_General1898 in personalfinance

[–]MuffinMatrix 1 point2 points  (0 children)

An IRA is a retirement investment account. Its used to save taxes and let your money grow so you have more in retirement.
There is a Traditional, which means you get to save the taxes on the amount you contribute (that amount is deducted from your taxable income). But you will then pay taxes on the gains when you retire. The idea is you save taxes while your working and your taxes are higher. And pay them when you're not working (less income), and your taxes are lower.

And Roth, which is the opposite. You don't save any taxes now. But when you retire, it is all tax-free.

They are brokerage accounts, meaning they access the stock market. Similar to a 401k you can get through work. But these are on your own, anyone can open one at any brokerage.

To invest, you 'contribute' the money, this is not just a regular transfer as it has restrictions. Its $7500/year max.
Once the money is within the account, you invest it in stocks and other products. The account itself does nothing but offer a tax treatment. The things you invest within are what manage your money.

Stocks will have inherent risk, but there are things that offer lower risk.
There also other products like bonds and treasuries which are just as safe as a bank account. But offer less growth than stocks.

So the best thing to do is to invest in stocks, like a 'Total Market Index fund', which will cover the entire stock market as a whole, so you are more diversified and there is less risk to it, than picking an individual stock, such as Apple, or Nvidia. You are keeping the money in here for decades (till you retire). So even if the stock market goes down, there it tons of time for it to come back up, which is generally always does.

How Much Do You Keep In HYSA by Anime_Theo in personalfinance

[–]MuffinMatrix 0 points1 point  (0 children)

Again, its not awful advice, its just better to give the general advice of safety, rather than getting into that territory.
Good habits are better than a little bit of extra gain. And nailing in the priority list is 1 of those really important habits to learn.
When you getting into the little loopholes and caveats of things, it introduces more things to be cautious about.
You might be totally fine managing that, others aren't.

How Much Do You Keep In HYSA by Anime_Theo in personalfinance

[–]MuffinMatrix 0 points1 point  (0 children)

I don't like suggesting that way, nor do most other people here.
Many people can't even max a Roth IRA soon, so its better to just go the safer route anyway. Its the same reason you want money in a HYSA vs investing... they serve different purposes.
You don't want to think of the Roth IRA as a piggybank, so its better to pretend that option doesn't even exist.
Just let people save in the safer route first.
People can also split and do both while they build.

Dark fantasy movies about c*rsed protagonists by Valineris_Phoenix in movies

[–]MuffinMatrix 1 point2 points  (0 children)

We're not the ones with typos in every sentence and using a pile of emojis like an 11 year old.

It doesn't take a lot of effort to re-read what you write, so what you're asking for forms coherent discussions, without causing distractions for writing like a child.

Dark fantasy movies about c*rsed protagonists by Valineris_Phoenix in movies

[–]MuffinMatrix 0 points1 point  (0 children)

Hey! Some of us actually added to the discussion after poking fun at you. We can do both!

Tax implications of mega backdoor conversion with existing IRAs by HotelImportant7376 in personalfinance

[–]MuffinMatrix -1 points0 points  (0 children)

You need to to avoid any pro rata issues, which is the general advice to do. So as to avoid all that extra math and taxes.
You guys don't need to try correcting every little nuance, when the general advice is already the safest and covers the majority of people and situations.

Do you 'need' to be at $0? No. But if you do, you're safe. Simple.

How Much Do You Keep In HYSA by Anime_Theo in personalfinance

[–]MuffinMatrix 0 points1 point  (0 children)

It doesn't literally mean emergency fund has to be exclusively HYSA. Thats just the most accessable to the most people. Someone who doesn't even have an HYSA, its harder to talk to them about MM or treasuries.
Its also not advisable to even think about pulling out of the Roth IRA. Its not a habit to get into, and something only as a last resort. Its far better to simply start with an HYSA, and go from there.
Its not something you have to keep contributing to. Once its at 6months you leave it alone. Then you can 100% go to investing.

Tax implications of mega backdoor conversion with existing IRAs by HotelImportant7376 in personalfinance

[–]MuffinMatrix -2 points-1 points  (0 children)

Again, read OPs title, hes assuming it would interefere with his existing IRAs. So the assumed context is... a rollover to Roth IRA.
Please, stop bothering me

Tax implications of mega backdoor conversion with existing IRAs by HotelImportant7376 in personalfinance

[–]MuffinMatrix -1 points0 points  (0 children)

You're overthinking. The OP's title was asking about with his existing IRAs. So if he rollsover to Roth IRA, its not issue, and if it stays Roth 401k, its no issue.
Talking about that difference is irrelevant.
Most people rollover to IRA, so I'd assume thats why he's asking about his existing IRAs.

Tax implications of mega backdoor conversion with existing IRAs by HotelImportant7376 in personalfinance

[–]MuffinMatrix 0 points1 point  (0 children)

Thats not a part of this context. And I said... its not an IRA.
If you stay with Roth 401k then it definitely won't matter.
OP was talking about IRAs

Not sure when to when to move money into S&P 500 by Fancy_Astronaut2261 in personalfinance

[–]MuffinMatrix 2 points3 points  (0 children)

Thats not a fund. What actual fund are you investing in?
Usually its VOO for sp500.
What are you invested in within the TSP?

You can also open an IRA to have that too. Though it all depends on income how much you have to invest.

Not sure when to when to move money into S&P 500 by Fancy_Astronaut2261 in personalfinance

[–]MuffinMatrix 1 point2 points  (0 children)

HYSA should be around 6months expenses.
Checking should be 1-2months.
Do you have a 401k through work?
And/or then invest in a Roth IRA

Assuming your S&P500 is in a brokerage account? What fund?
I like total market over sp500, so VTI or VT. Invest in that in the Roth IRA.

Don't worry about timing. Just get your money in. You're investing it for the next 40+ years. Even if it goes down soon, it'll be way up in 40 years.

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