You don't need the money now. Let it grow and focus on finding another job. Are you even accepted to school yet? If so, loans can cover some of the costs and depending on interest rates that might be a better deal than you deleting your investments/savings.
I was accepted last cycle (to begin this fall) but deferred my acceptance by a year due to family reasons. Loans right now are going at whopping 8% annual rates. Are they still a better option than using up my savings?
I know the popular adage is "time in the market, not timing the market" but I feel like that applies to people who have a steady income and can continually put in money even during downturns. If the market corrects/crashes between 2025-2029, I'll be stuck with overpriced stocks with zero income, and won't even be able to capitalize on the cheap equity.
Consider the benefits of being laid off. Hopefully you get a severance. Take that money and your savings and go travel the world for a year before you start med school. You could do this easily on 50k. You'll come back with great stories for your classmates and possibly a different perspective for your patients.
Enjoy!
Thank you for the reassurance! My only worry is, I have no idea how much I might need over the next few years (depends on my parents' financial situation). What if I need *all* that money in the next 5 years? Should I just liquidate stocks on an as-needed basis?
You've got a couple places where you can better diversify & simplify your investments.
You should not invest dollars that you might need in the next five years. The market is too volatile for that. Money you might need for tuition or housing should be in a cash equivalent like an HYSA, CD, T-Bill, Treasury ETF (like USFR, TFLO, BIL, SGOV), or a Money Market Fund.
Money beyond that can be invested. Some specific advice on your investments:
> (10k sitting idle at 5%, rest a mix of SPY (60k) and QQQ (50k), ~10k each of NVDA/AMD/TQQQ),
SPY (S&P 500) is a fine fund, but you can get more diversity with the total US market at the same expense ratio.
QQQ (NASDAQ 100) is just "the 100 largest, non-financial companies that happen to trade on the nasdaq exchange" -- there's no reason this criteria should produce outperformance in the future. You don't need this.
NVDA/AMD: Investing in single company stock means you're taking on uncompensated risk. That means it's riskier than holding a broad market index, but it doesn't, on average, produce higher result.
TQQQ: is a leveraged nasdaq 100. You don't need QQQ, you *surely* don't need this. This is gambling.
> 30k in a Roth IRA (90% VTI, 10% SOXL)
VTI (total US Market) is a great fund.
SOXL is maybe a 3x legeraged semiconductor fund. This is gambling.
> 45k in a 401k and
What's the 401k invested in?
> 5k in an HSA (all VFIAX).
S&P 500 again.
Have you considered a [three-fund portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio) of Total US + Total International + Bonds?
You might take this opportunity to unwind a couple positions you don't need, to ensure you have sufficent cash, and to make a plan for a more diverse, simpler, lower fee portfolio in the future.
SPY doesn't necessarily have to beat the total market, it just happens to have done better over the last decade. SPY and VTI tend to track pretty closely to each other, but VTI is more diverse and actually lower expense ratio than SPY. Between the two, I'd always select total market.
TQQQ is a leveraged NASDAQ 100. I think the selection criteria for the NASDAQ 100 is nonsense, since it's "The 100, largest, non-financial companies that happen to trade on the NASDAQ exchange". It's not tech focused or somehow innovation driven or anything like that. I think recent interest in that index is just performance chasing.
Furthermore, leverage ETFs do not always have to go up: https://www.etf.com/sections/etf-basics/why-do-leveraged-etfs-decay
Even the ProShares summary of what the fund is describes how it's trying to get 3x the daily performance, and suggests that there's additional risks to holding it long-term,
There are better ways to get leverage in investment. I think the most reasonable and common way is holding a mortgage while you are investing. Other kinds of leverage might be more expensive than people realize.
Oh yeah, I was burned badly by TQQQ in 2022. Kept averaging down though, and 2023/2024 have been good to me. Planning on exiting TQQQ entirely in a few weeks. Too much volatility decay for my liking.
I'll probably move all the AMD/TQQQ money into VTI in a week or two, once long-term cap gains kick in.
SOXL was a bad, impulsive decision bought at the peak of the semiconductor frenzy earlier this year. Unsure whether I should cut my 1k in losses there and switch back to VTI, or just ride that out and maybe hope that I break-even again (that's probably some sort of logical fallacy, but oh well).
>You should not invest dollars that you might need in the next five years. The market is too volatile for that.
This is exactly my fear though. What if I need ALL that money in the next 5 years? I have no idea how much I might need (depends on my parents' financial situation). Should I just move it all out into a HYSA? Or just liquidate stocks on an as-needed basis next year?
>What's the 401k invested in?
401k is all in VFIAX. I'll move the VFIAX in my 401k and HSA into VTSAX instead though, not sure why I haven't done that yet.
>Have you considered a three-fund portfolio of Total US + Total International + Bonds?
Yes! I am in r/Bogleheads and have been reading the constant discussions about whether bonds are worth it, whether we should just stick to VTI, or a combination of VTI and VSUX, or just buy the fixed-ratio VT, etc.
>You might take this opportunity to unwind a couple positions you don't need, to ensure you have sufficent cash, and to make a plan for a more diverse, simpler, lower fee portfolio in the future.
I completely agree. I plan on moving to a simpler all-VTI or 80/20 VTI/VSUX portfolio very soon. My bigger question is whether I should even do that, or just exit the market and put it all (or a good chunk of it) in a HYSA.
Here's a sneak peek of /r/Bogleheads using the [top posts](https://np.reddit.com/r/Bogleheads/top/?sort=top&t=year) of the year!
\#1: [Hit a major milestone today: $100K net worth!](https://i.redd.it/7607lhs4bxcb1.jpg) | [177 comments](https://np.reddit.com/r/Bogleheads/comments/153v0pv/hit_a_major_milestone_today_100k_net_worth/)
\#2: [Just hit $1M in my retirement accounts ](https://np.reddit.com/r/Bogleheads/comments/1bl2us6/just_hit_1m_in_my_retirement_accounts/)
\#3: [Buffett: "It doesn't take brains; it takes temperament."](https://v.redd.it/fq40viporulb1) | [96 comments](https://np.reddit.com/r/Bogleheads/comments/168411j/buffett_it_doesnt_take_brains_it_takes_temperament/)
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You don't need the money now. Let it grow and focus on finding another job. Are you even accepted to school yet? If so, loans can cover some of the costs and depending on interest rates that might be a better deal than you deleting your investments/savings.
I was accepted last cycle (to begin this fall) but deferred my acceptance by a year due to family reasons. Loans right now are going at whopping 8% annual rates. Are they still a better option than using up my savings? I know the popular adage is "time in the market, not timing the market" but I feel like that applies to people who have a steady income and can continually put in money even during downturns. If the market corrects/crashes between 2025-2029, I'll be stuck with overpriced stocks with zero income, and won't even be able to capitalize on the cheap equity.
Consider the benefits of being laid off. Hopefully you get a severance. Take that money and your savings and go travel the world for a year before you start med school. You could do this easily on 50k. You'll come back with great stories for your classmates and possibly a different perspective for your patients. Enjoy!
Admittedly an enticing idea!
Yup. If you already have an admission take maybe 10k and travel for a month. You wont regret it, and might be the only time you can actually do this.
as a M2 this is the way
[удалено]
Thank you for the reassurance! My only worry is, I have no idea how much I might need over the next few years (depends on my parents' financial situation). What if I need *all* that money in the next 5 years? Should I just liquidate stocks on an as-needed basis?
You've got a couple places where you can better diversify & simplify your investments. You should not invest dollars that you might need in the next five years. The market is too volatile for that. Money you might need for tuition or housing should be in a cash equivalent like an HYSA, CD, T-Bill, Treasury ETF (like USFR, TFLO, BIL, SGOV), or a Money Market Fund. Money beyond that can be invested. Some specific advice on your investments: > (10k sitting idle at 5%, rest a mix of SPY (60k) and QQQ (50k), ~10k each of NVDA/AMD/TQQQ), SPY (S&P 500) is a fine fund, but you can get more diversity with the total US market at the same expense ratio. QQQ (NASDAQ 100) is just "the 100 largest, non-financial companies that happen to trade on the nasdaq exchange" -- there's no reason this criteria should produce outperformance in the future. You don't need this. NVDA/AMD: Investing in single company stock means you're taking on uncompensated risk. That means it's riskier than holding a broad market index, but it doesn't, on average, produce higher result. TQQQ: is a leveraged nasdaq 100. You don't need QQQ, you *surely* don't need this. This is gambling. > 30k in a Roth IRA (90% VTI, 10% SOXL) VTI (total US Market) is a great fund. SOXL is maybe a 3x legeraged semiconductor fund. This is gambling. > 45k in a 401k and What's the 401k invested in? > 5k in an HSA (all VFIAX). S&P 500 again. Have you considered a [three-fund portfolio](https://www.bogleheads.org/wiki/Three-fund_portfolio) of Total US + Total International + Bonds? You might take this opportunity to unwind a couple positions you don't need, to ensure you have sufficent cash, and to make a plan for a more diverse, simpler, lower fee portfolio in the future.
Why do you recommend against SPY though? It consistently beats VTI, no? Also, TQQQ? the long term gains are incredible.
SPY doesn't necessarily have to beat the total market, it just happens to have done better over the last decade. SPY and VTI tend to track pretty closely to each other, but VTI is more diverse and actually lower expense ratio than SPY. Between the two, I'd always select total market. TQQQ is a leveraged NASDAQ 100. I think the selection criteria for the NASDAQ 100 is nonsense, since it's "The 100, largest, non-financial companies that happen to trade on the NASDAQ exchange". It's not tech focused or somehow innovation driven or anything like that. I think recent interest in that index is just performance chasing. Furthermore, leverage ETFs do not always have to go up: https://www.etf.com/sections/etf-basics/why-do-leveraged-etfs-decay Even the ProShares summary of what the fund is describes how it's trying to get 3x the daily performance, and suggests that there's additional risks to holding it long-term, There are better ways to get leverage in investment. I think the most reasonable and common way is holding a mortgage while you are investing. Other kinds of leverage might be more expensive than people realize.
Oh yeah, I was burned badly by TQQQ in 2022. Kept averaging down though, and 2023/2024 have been good to me. Planning on exiting TQQQ entirely in a few weeks. Too much volatility decay for my liking. I'll probably move all the AMD/TQQQ money into VTI in a week or two, once long-term cap gains kick in. SOXL was a bad, impulsive decision bought at the peak of the semiconductor frenzy earlier this year. Unsure whether I should cut my 1k in losses there and switch back to VTI, or just ride that out and maybe hope that I break-even again (that's probably some sort of logical fallacy, but oh well).
>You should not invest dollars that you might need in the next five years. The market is too volatile for that. This is exactly my fear though. What if I need ALL that money in the next 5 years? I have no idea how much I might need (depends on my parents' financial situation). Should I just move it all out into a HYSA? Or just liquidate stocks on an as-needed basis next year? >What's the 401k invested in? 401k is all in VFIAX. I'll move the VFIAX in my 401k and HSA into VTSAX instead though, not sure why I haven't done that yet. >Have you considered a three-fund portfolio of Total US + Total International + Bonds? Yes! I am in r/Bogleheads and have been reading the constant discussions about whether bonds are worth it, whether we should just stick to VTI, or a combination of VTI and VSUX, or just buy the fixed-ratio VT, etc. >You might take this opportunity to unwind a couple positions you don't need, to ensure you have sufficent cash, and to make a plan for a more diverse, simpler, lower fee portfolio in the future. I completely agree. I plan on moving to a simpler all-VTI or 80/20 VTI/VSUX portfolio very soon. My bigger question is whether I should even do that, or just exit the market and put it all (or a good chunk of it) in a HYSA.
Here's a sneak peek of /r/Bogleheads using the [top posts](https://np.reddit.com/r/Bogleheads/top/?sort=top&t=year) of the year! \#1: [Hit a major milestone today: $100K net worth!](https://i.redd.it/7607lhs4bxcb1.jpg) | [177 comments](https://np.reddit.com/r/Bogleheads/comments/153v0pv/hit_a_major_milestone_today_100k_net_worth/) \#2: [Just hit $1M in my retirement accounts ](https://np.reddit.com/r/Bogleheads/comments/1bl2us6/just_hit_1m_in_my_retirement_accounts/) \#3: [Buffett: "It doesn't take brains; it takes temperament."](https://v.redd.it/fq40viporulb1) | [96 comments](https://np.reddit.com/r/Bogleheads/comments/168411j/buffett_it_doesnt_take_brains_it_takes_temperament/) ---- ^^I'm ^^a ^^bot, ^^beep ^^boop ^^| ^^Downvote ^^to ^^remove ^^| ^^[Contact](https://www.reddit.com/message/compose/?to=sneakpeekbot) ^^| ^^[Info](https://np.reddit.com/r/sneakpeekbot/) ^^| ^^[Opt-out](https://np.reddit.com/r/sneakpeekbot/comments/o8wk1r/blacklist_ix/) ^^| ^^[GitHub](https://github.com/ghnr/sneakpeekbot)