There will always be people who think the world is ending regardless of which adminstration is in office. Some people felt the previous administration was doom and gloom. Some people probably feel the same thing with this one too. Imho, just about the worst thing one could.do is make significant financals decisions based on your feelings toward the imcumbent government.. Been there done that ….AN talked some.sense into me about that..
In the past, every time I try to fck with my passive investments, it always ended up doing worse in the long term than if I left it alone. The 4 main categories of account I have are 529k,401k, After tax Vanguard index fund basket, and a self managed trading account. And their performance over a long period of time has always been from best to worst in that order.. simply because those accounts are in the order of difficulty to fck around with.
The 529k account is the most restrictive because you can only elect changes to your investments twice per year and you are limited severely by the types of funds you can invest in. Since 2006, it’s been the best performing account for me for that reason. The 401k accounts would have been better (due to the lower fee structure) if I didn’t generally fvk with it too by trying to time the market and trying to borrow against it when I didn’t need to.. I thought it would be good to take some money off the table, and a self loan wuth 4% interest paid to myself sounded like a great idea….Certainly it would be better than leaving it in that Fidelity Contrafund longer to get that extra 27% gain….doh …. And the after tax vanguard account has an issue simply that capital gains distributions can’t compound as well as all those other account types, though some index funds Vanguard offers a more tax efficient flavor (tax managed small cap, mid cap, etc)… The self trading accounts are hit or miss. short term fine, long term not so fine…
I’ve just got use to deferring $7000 each month between my 401k, 529k, after tax vanguard account, and leave my speculation account on life support to no longer feed that gambling addiction lol… That deferral was much higher before, but I’m sorry, I like to enjoy life more these days. I always max out my 401k to get whatever matching there is… if any… And lately I’ve been putting a lot more in the 529k versus the after tax vanguard, simply because of the new tax law changes for the 529k. Theoretically you can contribute I think up to $500k to one 529k…and distributing it shouldn’t be a problem for me since you can use it now for K-12 private schools , which my pedigreed raised nieces and nephews are attending anyway… I figure I can get a lot more capital gains tax free versus a traditional after tax index account… and the funds are basically the same…
Don’t fk around with your 401k/529k/or passive index funds….Just do that biweekly or monthly automatic deposit, and forget about it.
