• The KillerFrogs

OT: How Do You Invest Your Money?

Virginia Frog

Active Member
  1. For buying the new car, I figured out the exact car, color, and trim level I wanted, and reached out to every hyundai dealer in the greater metroplex through their online sales rep, which was usually an online live chat. I told them what I was looking for, that I was looking at every dealer in DFW, and I wanted their best out the door price they could offer. This usually led to follow up via email which gave me numerous competitive offers in writing. I used these offers to have the most competitive dealers further compete against each other, ultimately trying to get the closest dealer to me to agree to the best offer I was getting. Spoke to the sales rep over the phone making it clear that we were agreeing to the final out the door price and financing, and if anything changed once I got to the dealership I would leave. Got the final agreement in writing via email. Drove to the dealership. Test drove the specific car I was interested in. And was driving off the lot with my new car in under 2 hours. They still tried jerking my chain a few times and attempted to add some additional costs / increase my interest rate on the loan. After threatening to leave a few times, I finally got to what we had agreed to before I arrived. Anyway. Felt this strategy really helped me get an extremely competitive price for the car.
Your system is a winner.

Competition matters when buying a NEW vehicle.

The only things that I'd do differently in a similar car buy is:

1) Have a competing but similar brand/model in the mix. If you want a Honda, also add the comparable Toyota as an option. In this case where your target is a Hyundal maybe let them know you are Kia shopping too.
This gives you additional leverage over the sellers as to whether you'll "walk" if the deal isn't the best (or if they think they are going to mess with you at the 11th hour of the negotiation.) It's also a good fake-out - the Hyundai sellers don't know that the Kia option is a red herring. If they're gonna play you, you might was well play them a bit.

2) End of the month/Quarter. Dealerships will often have "situations" where they have a real need to move X # of cars by a certain date. You won't know this in advance but some of the dealers will show you their cards so you'll say "yes" to them.

3) Geography - DFW is a large region and it for you it worked out great. I will fan out my offers up to 125 miles. Some dealers will not play if you are far away - they'll claim that you won't be a "repair" customer and it's not in their interest to sell to a "one-timer." In the mid-Atlantic I have found that there are price laws in Maryland (vs. DC, PA, WV and DE) that make their dealers more competitive by $1 to 1.5 grand, I once bought a Honda car in 1986 in Blacksburg VA (260 mi away.) In those days getting a Honda was a premium purchase (tremendous demand) and they bent over backwards to get my sale.

My experience is that this can be a pretty pleasant experience. None of all that angst typically associated with new car purchases. I've found that most dealers RESPECT real professional, smart buyers and they are cool with and happy to sell to you - even if they are taking it on the nose to get your money!
 
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HToady

Full Member
I have also heard that you are penalized if you have a 529 if you apply for Grants under FASFA. You should use your 529 for the second two years of college, but not mention them (using money from elsewhere) if you intend to apply for Grants their Freshman and Sophmore year? Anybody know if this is true. It effects how much i put in, if true.
 
If you are comfortable with debt then go get some, rates are fantastic right now. We have always been as debt averse as possible so consequently we have none. Coming from someone who paid 12% escalating on our first mortgage a hunnerd years ago ('79).

Best investment advice is don't have kids, but your wife will probably overrule.
Debt is perhaps the most valuable financial instrument.
 

ticketfrog123

Active Member
#1 - Invest in yourself. Started my own company and bought an office for it. Hopefully it appreciates and only I can raise my rent.
#2 - Develop new ideas. I’ve developed a start-up that is pre-launch. A team is putting it together. If it fails, I lose everything I put in, but I believe in investing in myself. If it goes well, it’ll be a big win.
#3 - Buy low. Bought real estate in 2010. Now buying energy funds. Oil is cyclical. It’ll rebound.
#4 - Max retirement accounts inside large passive mutual funds. Low fees and time.
#5 - Diversify in real estate. I’m in a few syndicated real estate projects that spit off quarterly returns. I don’t manage them. I prefer real estate that focuses on blue collar areas.
#6 - Invest in start-ups that you believe in. It’s high risk high reward. I don’t put a high % here, but if a profitable company needs $ to fill orders and I believe in it, I consider it.
#7 - Don’t invest in something you don’t understand. I don’t understand bitcoin. It may be a great idea, but it isn’t for me.

ironic that #7 contradicts #3. You’re certainly not an energy guy if you’re advising people to throw money at those stocks right now.
 

ticketfrog123

Active Member
Our standard:
- Max 401k contributions
- Max Roth IRA contributions just to split the tax risk difference
- 529 for kids’ college
- Pay that 30 year mortgage like a 15 by tacking on extra principal (or more aggressive when possible)
We’ve also got a brokerage that we tot around the market in - and we build savings there with the plan of doing some real estate investment (other than our home) in the near future.

It’s a marathon, not a sprint. But a sprint out the gate pays off. If you can, build your retirement account base very aggressively and make the down payment on a house before you have kids. Then as income goes up and you have kids and all their expenses, play the long game.

Over the long-term, throwing your extra mortgage money at a mutual fund will significantly outpace the return from interest savings on the mortgage
 

HG73

Active Member
Debt is perhaps the most valuable financial instrument.
Somewhat true, especially at today's rates. And this is coming from someone who has had every type of negative amortization mortgage and car loan out there. :)
And you won't ever have the absolute nicest house or car out there.
But, it's kind of like beating UT, for some reason it just feels so damn good.
 

talor

Active Member
Class of 2007
  • 401k up to company match amount
  • Max out Roth IRA
  • Employee stock purchase plan if offered (generally can lock in 15% return)
  • Real estate that is not your own personal residence
  • Bitcoin
  • Northwestern mutual permanent life insurance
 

McFroggin

Active Member
But you haven't realized your energy investment performance if you are buying now.... I think that was the point. You think energy will rebound and ticketfrog doesn't, the result is yet to be determined.

Fair point on my recent purchases. I made specific investments in O&G in 2019 that have been sold for profit.
 

BABYFACE

Full Member
My advice is old school and simple. Avoid or minimize debt. It’s amazing how much extra money you have in your pocket to invest if you choose to.

Taking on debt to use towards investment is a game I choose not play no matter if the numbers look in your favor. Things can always change. Paid off car is a thing of beauty. Owning your home outright is fantastic.

Had a relative take out a loan on their home they owned free and clear. Why, because the loan rate was low and returns in the market were much higher on investments. I told him was a mistake because things change. Well they did over a decade ago. Housing bubble burst and the market tanked in a deep recession. Hated to be right.

I am just common sense guy that doesn’t believe handling one’s personal finances like a day trader.
 
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Atom

Full Member
I mix my strategies in non 401k accounts in between growth and dividend growth investing. I like to be in equities pretty much exclusively with a small allocation to bonds. I believe that the dividend growth aristocrats, champions, etc give a level of downside protection and growing income stream. Especially when I have it set to DRIP on a lot of those.

Better to buy when undervalued which is easier said than done. I utilize fastgraphs.com for some pretty easy to understand/quick analytics as I don't have all day to do it myself.

I also have a funny money account where I dabble in frequent trading following people on Twitter and a couple of websites. It's basically been zero sum for me but fun when you win.
 
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