Monday, April 17, 2006

Short to Mid-Term Investment and Savings Strategies

Said it before and I'll say it again. Cash will be king in the next few years.

So what are your short to mid-term investment strategies? Risky or safe? CD's? Funds? Stocks? Bonds? Commodities? Are you planning to stay liquid or going long-term? Laddering CD's? Best rate? Let's hear them!

What about savings tips? What are you doing to save the most money you possibly can over the next year? Let's have your best money saving ideas!

Caveat Emptor!
Grim

42 Comments:

Blogger grim said...

You load sixteen tons, what do you get?

Another day older and deeper in debt.

Saint Peter don't you call me 'cause I can't go.

I owe my soul to the company store.

4/17/2006 09:14:00 AM  
Anonymous Anonymous said...

"Said it before and I'll say it again. Cash will be king in the next few years."

Right..because we all know the dollar is holding up so well against foreign currencies.

4/17/2006 09:38:00 AM  
Blogger grim said...

Never said your cash had to be denominated in USD my friend.

If that is your play, let's hear the details.

grim

4/17/2006 09:51:00 AM  
Blogger grim said...

Or even your assets.

jb

4/17/2006 09:53:00 AM  
Anonymous Anonymous said...

Richard, would you use ETFs to cover the commodity portion of your portfolio? I've been looking at them lately. There seem to be a lot of options for investing in non-tradtional areas with these.

Not sure about the crude oil tracking ETF though...the jury seems to be out on that one...

JM

4/17/2006 10:14:00 AM  
Anonymous Anonymous said...

HCSB 6 month is 4.79/4.85

4/17/2006 11:14:00 AM  
Blogger grim said...

For anyone wondering about playing the treasury market:

http://www.treasurydirect.gov

I also use HCSB for their promotional CD rates. The 6-month yield is great considering it's a branch rate.

grim

4/17/2006 11:59:00 AM  
Anonymous Anonymous said...

automatic withdrawals from checking account to ING savings account!

4/17/2006 12:15:00 PM  
Anonymous Anonymous said...

6 month T-Bills are yielding 4.93% and the interest isn't subject to state income tax.

-------------------------


How do those work? Are they essentially like a CD?

Why is the interest not taxed as income?

Are they insured, similar to FDIC?

4/17/2006 12:19:00 PM  
Blogger grim said...

Love Treasury Direct, for anyone interested in treasuries, just go check out the website. They've got quite a bit of information available and the user interface is pretty straightforward.

Put in an order for equal dollar amounts of 13 and 26 week bills. Next auction date to get in would be Monday the 24th.

I'm short and laddered in t-bills. I won't go longer than 6 months on either T-bills or CD's currently.

grim

4/17/2006 12:43:00 PM  
Anonymous Anonymous said...

1 thought on commodities...don't.
If you were really good, in 2002 you would have, not now.

4/17/2006 12:58:00 PM  
Anonymous Anonymous said...

The info for 6 month (26 week) T-bills is all greek to me:

http://www.treasurydirect.gov/indiv/research/indepth/tbills/res_tbill_faq.htm

"Weekly auctions"?

Also, is the value at maturity automatically deposited into your checking account, or is a deliberate 'redeem' step involved?

4/17/2006 02:00:00 PM  
Anonymous Anonymous said...

Gold, gold, and maybe gold.

4/17/2006 02:11:00 PM  
Anonymous Anonymous said...

BOOOOYAAAAAA!

http://danwho.net/mp/index.php?id=snl_dontbuystuff


Bob

4/17/2006 02:12:00 PM  
Blogger Metroplexual said...

An article at bankrate.com
http://www.bankrate.com/brm/story_content.asp?story_uid=18750&prodtype=mtg

Are rates headed even higher?

STEADY GOING: Rates seem to have pretty much stalled out since Thursday. Freddie Mac's required net yields, which affect the prices that lenders get when they sell loans, are virtually unchanged. The 10-year Treasury yields 5.02 percent this afternoon, down from Thursday's 5.04 percent.
Columnist Kenneth Harney says: "The global bond market sent an unmistakable message to the U.S. real estate market last Thursday: 10-year Treasury notes, the key index used by American lenders to price 30-year home mortgages, jumped past 5 percent for the first time in nearly four years.

"That means that mortgage rates are virtually certain to rise beyond where they were earlier last week -- 6.5 percent for conforming 30-year loans, according to the Mortgage Bankers Association of America."

4/17/2006 02:19:00 PM  
Blogger chicagofinance said...

Don't kill a fly with a sledgehammer.

If it is your house money, keep it simple, keep it liquid.

What is 50 bps per annum on $100,000? $500

You could burn up that amount or more on breakage fees or being caught flatfooted when you need to make an aggressive move.

The market is smarter than all of us. You are already trying to time the real estate market. Don't press your luck.

4/17/2006 02:27:00 PM  
Anonymous Anonymous said...

Thanks debtvulture, that info helps tremendously!

4/17/2006 02:57:00 PM  
Anonymous Anonymous said...

This advice helps too: "Don't kill a fly with a sledgehammer."

I'll see how the RE market does come July, as the window closes for buyers to register kiddies for school, and keep fully liquid (ingdirect.com) until then.

4/17/2006 03:02:00 PM  
Blogger grim said...

Was hoping to get more savings tips than investment tips.

grim

4/17/2006 03:34:00 PM  
Anonymous Anonymous said...

Use your Discover or Amex Blue card for gas purchases and get 5% cash rebate.

Hey, I paid $2.65/gallon for regular at Costco today. 5% adds up!

4/17/2006 03:49:00 PM  
Anonymous Anonymous said...

Some savings tips:

* Never pay interest.

* Always buy stuff on sale - never pay full retail for anything.

* Drop needless monthly burn expenses - expanded cable TV package, etc.

* Eat in restaurants as infrequently as possible, and the $25 dish almost never tastes better than the $12 dish.

* Don't 'go to the mall' unless you actually need something - you'll just end up buying more junk.

* Buy in bulk when things are on sale.

* Live below your means.

* Don't be a stingy scrooge, enjoy nights out with your friends (not really a savings tip). :-)

* Stay away from Vegas/Atlantic City.

* Run as many expenses possible through a reward points credit card, and pay off the full balance each month.

* Enjoy the decent interest rates at banks and save, save, save. Keep that 'average daily balance' as high as possible.

4/17/2006 04:01:00 PM  
Blogger grim said...

The credit card companies must hate me. I've never carried any balance, nor have I ever paid a fee.

I do, however, use rewards cards for 90% of my purchases. Gas, Groceries, and anything else where there isn't a 'cash discount'.

While I do carry a debit card, I don't ever use it.

I used to use my Chase Subaru rewards card religiously. It paid 3% back on all purchases in "Subaru Bucks". These certificates were redeemable for parts, service, or maintenance, etc (I'm sure you get the idea). However, the certificates were very easy to sell at 80% face value online.

The return I'd get through selling them (2.4%) was higher than the 1% cash back through Discover, so I preferred.

I'm sure you folks are wondering why I even bother. I used to put some very expensive items on my cards (tuition, vacations, business expenses, etc).

grim

4/17/2006 04:14:00 PM  
Blogger chicagofinance said...

DebtVulture said...
Chicago,

As you know, 1-month T-Bills are very flexible. It would take you more than 30 days to close on a house in almost all circumstances so that money would be pretty handy to have for your house money.

3:42 PM


Vultch: I agree, but to most people, keeping up with bills and other chores is challenge enough. It takes a special breed [of which I am one] to play with games where "disciplined behavior" is key.

Repeatedly, when you describe such approches to people, their eyes glaze over. To the average person, even credit card "teaser rate" hopping is hard to manage without tripping a wire.

4/17/2006 04:30:00 PM  
Anonymous Anonymous said...

Those points add up quickly when you run everything (the phone bill, cell phone bill, cable TV bill, groceries, etc) through a reward points card.

Can't turn away free money.

4/17/2006 04:33:00 PM  
Blogger chicagofinance said...

I just read back the last post - I don't mean to sound arrogant.

My point is that some people find working on these issues relaxing. Others find it stressful or annoying.

Unless you find such approaches satisifying - do not feel as if you are shortchnaging yourself by keeping the approach simple.

4/17/2006 04:34:00 PM  
Anonymous Anonymous said...

I got rid of my car and just ride my bike everywhere. I thought I would get another car, but I really like riding my bike, and everytime I think of spending money on a car and gas and insurance, I change my mind.

4/17/2006 05:30:00 PM  
Anonymous Anonymous said...

I bought some shares in AMTD stock (Ameritrade). Anybody on this blog with expertise in the stock market and where would you think this stock will be in 12 months?
Thanks

4/17/2006 06:32:00 PM  
Blogger grim said...

I think discussing individual stocks is well out of the realm of this blog..

However, anyone following ECR tonite (ECC Capital)?

(Reuters) - ECC Capital Corp. The company, which reported a net loss of $49.8 million for the fourth quarter of 2005, had in February said it would not pay any dividend in the first quarter of this year due to losses in its mortgage banking segment.

If ECC Capital utilizes available cash for operations, it may not have sufficient cash to pay the distributions required to maintain its REIT status, the company said in a news release to announce the results.

4/17/2006 06:44:00 PM  
Blogger Roadtripboy said...

I just changed my W-4 withholding to 1 exemption (from 0). Since I regularly get a refund, this translates to giving the government an interest-free loan every year. I plan to increase my bi-weekly savings in my ING Direct account which is now paying 4% interest and make a little money throughout the year. Then if I happen to owe, I'll be ready.

I also try to take my own lunch to work rather than buy lunch everyday. In Manhattan, you can easily spend $8 just on a sandwich and a soda. That's about $160 a month just on weekday lunches. I also have eliminated my afternoon coffee, especially the Starbucks which can easily be $2 a pop for plain coffee (more if you get cappuccino or latte).

Since I can't be without a car, I choose one that get's good fuel economy (Pontiac Vibe: 29 city/36 highway, regular fuel) and I keep my driving record clean. Tickets, accidents and claims make for higher auto insurance premiums. I take the highest possible deductibles and use the same company for my renters and auto insurance (multi-policy discount). I find that I am only paying about $60 more per term in NJ than I did in Michigan (my home state), which actually says to me that Michigan was quite high!

4/17/2006 06:54:00 PM  
Blogger grim said...

Traffic has been picking up pretty rapidly over the past week or two.

Averages for the past few days are up near 2,000 visitors a day and 3,500 hits a day.

Seems like we're regularly hitting 100 comments on a thread.

The forums are in the works, only really need to come up with a easy-to-remember domain name.

grim

grim

4/17/2006 08:11:00 PM  
Blogger 42 said...

vulture,

which card does 'friend' have that's zero percent?

I thought Citi were stupid to give me 1.99, but 0.00 is lots better than that.

4/17/2006 09:56:00 PM  
Blogger Metroplexual said...

Roadtripboy said...

I just changed my W-4 withholding to 1 exemption (from 0). Since I regularly get a refund, this translates to giving the government an interest-free loan every year......

Just be careful that the money you are saving does not throw you into a situation where you are paying interest and penalties because you owe them too much. It almost happened to me this year.

4/18/2006 02:50:00 PM  
Anonymous Anonymous said...

There is a huge bull market on oil stocks and commodities and you guys are sitting on 4% CD's???
What a load of crap. Go out there and make some MONEY. 4% CD's are for retirees and I don't consider it as a strategy.
Be bold!

4/18/2006 02:52:00 PM  
Anonymous Anonymous said...

"There is a huge bull market on oil stocks and commodities and you guys are sitting on 4% CD's???
What a load of crap. Go out there and make some MONEY. 4% CD's are for retirees and I don't consider it as a strategy.
Be bold!"



Each of my friends lost $50,000+ when there was a bull market on technology and dot-com stocks.

Mark Cuban cashed out broadcast.com just before the bust, and made a Billion dollars. That's billion with a B.

Here's a posting from him:

"The stock market is for suckers"
http://www.blogmaverick.com/entry/1234000173073470/

4/19/2006 01:44:00 PM  
Anonymous Anonymous said...

Here's a post from Billionaire Mark Cuban:

"My Investment advice for 2006"
http://www.blogmaverick.com/entry/1234000700073465

4/19/2006 01:56:00 PM  
Anonymous Anonymous said...

I have been following a site now for almost 2 years and I have found it to be both reliable and profitable. They post daily and their stock trades have been beating
the indexes easily.

Take a look at Wallstreetwinnersonline.com

RickJ

5/18/2006 04:53:00 PM  
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