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I can't believe it


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2022 May 5, 2:46pm   1,410 views  19 comments

by clambo   ➕follow (2)   💰tip   ignore  

I agree with Pocahontas on this issue; Fidelity should not let people gamble their 401K on Bitcoin or similar nonsense.
I have a couple cypto currencies; PayPal and Western Union apps.
To clarify, the means to transfer money is not an asset.
In a few days Apple is going to pay me another dividend in the form of shares of AAPL.
That's a real asset.

Comments 1 - 19 of 19        Search these comments

1   mell   2022 May 5, 2:54pm  

Why, they gambled with the tech tranny stocks as well. Don't tell me the tech tranny nasdaq freak crowd is doing any better at the moment.
2   Hircus   2022 May 5, 6:23pm  

If it does get approved though...it's hard to not see it juice the price. It should add a steady demand to buoy the price, allowing the robber barrons to slowly cash in some of their stake, with a large "pleased with themselves" smile on their face due to their successful purchase of this slick move that got a fraction of 401k account value placed into crypto.

The coin bubble might keep inflating for a long time tho...
3   SunnyvaleCA   2022 May 5, 8:34pm  

I use the IRA for the short-term and complicated-tax trades. That way I don't have to deal with taxes. Yet another distortion caused by tax code.
4   clambo   2022 May 5, 10:37pm  

Ideally retirement accounts have boring investments.

But, the tax code pushes us to use the retirement accounts for trading.
5   stfu   2022 May 6, 5:38am  

Buried in the Biden plan for overhauling retirement plans is a little gem that allows for the selling of insurance contracts (annuities) inside of the 401k structure.

Do your own research, but there are no 'good' annuities - the least evil being an immediate annuity.
6   clambo   2022 May 6, 5:57am  

Stfu, I can tell you a story about an annuity which I bought just for a perspective.

Once upon a time, the IRA contribution limit was $2000/year.
401K plans were not universally offered to employees. I worked at a small business which didn’t offer one.

Later I was self employed and I had extra money to invest after my IRA and SEP-IRA.
The contribution limit was low for the SEP also.

So I bought a Vanguard variable annuity with stock mutual funds in it ( called sub accounts)
The total fees were about the same as my mutual funds at T. Rowe Price, not expensive to own.

My other dough is in taxable mutual funds and the 1099s they produce kind of suck.

Today Vanguard does not sell variable annuities, but they sell something good “Tax Managed Capital Appreciation” which tries to produce a very small 1099.

I set up my contract to pay at age 99; this means that I can treat it like an IRA and take out a little or a lot of money as I wish until then.

At any time I can annuitize it (take regular payments) or exchange it for a fixed immediate annuity.

I have no idea why someone would put a variable annuity inside a 401K however.

I recently made my girlfriend in Baja California Sur Mexico my beneficiary, so I probably will never spend it anyway.
7   SunnyvaleCA   2022 May 6, 2:08pm  

I think "stfu" was saying that annuities tend to give poor return when compared to other investments. Clambo's follow-up comment doesn't really address that. Yeah, I think it's a little odd to buy an annuity inside a tax-deferred IRA, since (I think?) an annuity won't generate capital gains or other taxes until you start withdrawing — much like an IRA. So you might as well use your non-IRA money to buy an annuity and leave the IRA for the short-term trading (where it won't cause you short-term capital gains taxes).
8   SunnyvaleCA   2022 May 6, 2:14pm  

Am I right that an annuity is more about guaranteed income and not about total expected investment gain? Like insurance, you're not buying it and expecting to win some jackpot; you're buying it and hoping that you end up not having to rely on it.

And with that out of the way, what do people think about buying an annuity? I'm at a financial point where I wouldn't mind spending a large chunk of money at age 53 if it could guarantee financial security until death. My hesitations are that the annuity seller defaults or that somewhere buried in the fine print is something that makes the annuity far less appealing than originally expected. Such an annuity would, presumably, need to be inflation-proof, which alone is a tall order.
9   clambo   2022 May 6, 4:16pm  

Sunnyvale
My variable annuity sub account is performing well.
The manager is Primecap in Pasadena.
I have a sub account in it managed by the guys who manage Vanguard International Growth Fund.
They manage some very good funds at Vanguard.
One is called "Primecap".

The variable annuity is similar to a non-deductible IRA with no contribution limit.

The fixed income immediate annuity is something that pays out for your lifetime (and partner if desired), so-called "second to die."

It's a bit confusing because there are different options and rules.

A cool feature is uncle Sam doesn't know you own it.
Spending it will generate a 1099 so he will find out later.

Edit
You can systematically withdraw any investment, so it will seem like annuity payments.
10   NuttBoxer   2022 May 6, 6:40pm  

clambo says
Fidelity should not let people gamble their 401K on Bitcoin or similar nonsense.


If you cut out the nonsense, there's nothing left in a traditional 401k, just like they'll be nothing left in everyone's accounts, again. Seems 2008 didn't do a good enough job teaching people their lesson about central banks. 2022 will do the trick.

It's no one's job to stop people from making stupid financial decisions, that's a nanny state. And we grown ass adults here, so take your lumps.
11   clambo   2022 May 6, 8:20pm  

The stock market can drop some more but it'll come back if you wait a while.

A 401K is a retirement device and not for gambling.

You shouldn't get a tax deduction for buying nonsense.

I agree about letting people make mistakes, but I think Bitcoin should be illegal.
If it is legal, it should not be tax deductible like a 401K is.
12   Onvacation   2022 May 6, 8:21pm  

NuttBoxer says
2022 will do the trick

October surprise.
13   NuttBoxer   2022 May 6, 9:40pm  

clambo says
A 401K is a retirement device and not for gambling.

You shouldn't get a tax deduction for buying nonsense.


A 401k is a tool for keeping money out of your hands, and in the central banking system. And if worse comes to worse, bailing that system out. They'll drain you in a second, through inflation or appropriation, and you won't be able to do anything about it. Don't believe me? Look back on history. Pensions have been liquidated more than a few times when it served the ruling powers interest.

At this point, everything with counter-party risk is gambling. Stocks, bonds, it's makes no difference. All carry huge risk. Maybe not as parabolic as crypto yet, but give it a few more months. The only investments that make sense for retirement are land, learning self-sufficiency, guns, your own business, and gold and silver. Everything else is a wash, so don't be too quick to look down on the cryptoknights, you'll soon be joining them.
14   clambo   2022 May 6, 10:28pm  

I’m unclear who are cryptoknights.
I’m paid thousands of dollars in interest and dividends, how is that supposed to end?
I agree my net worth is less than it was in January.
I’m hoping for the trend to turn around in the fall, maybe after the socialists get their asses kicked in the polls.
15   RWSGFY   2022 May 8, 12:20pm  

NuttBoxer says

clambo says
Fidelity should not let people gamble their 401K on Bitcoin or similar nonsense.


If you cut out the nonsense, there's nothing left in a traditional 401k, just like they'll be nothing left in everyone's accounts, again. Seems 2008 didn't do a good enough job teaching people their lesson about central banks. 2022 will do the trick.

It's no one's job to stop people from making stupid financial decisions, that's a nanny state. And we grown ass adults here, so take your lumps.


401k is THE BEST tax shelter for the working stiff. Nothing beats it. And if 2008 taught anyone anything is that long-term broad stock market index fund is the best place to be. The "nothing left in the accounts" didn't happen then and I doubt it will happen now. Or ever. (Well, maybe in Russia it will, just like it already happened in 1998, lol)

Of course, I won't touch a buttcoin fund with a 10ft borrowed pole, but I'm not against people making their own mistakes, as long as all disclamers are presented to them.
16   Hircus   2022 May 8, 3:15pm  

clambo says

They manage some very good funds at Vanguard.
One is called "Primecap".


Ya I've been watching them for a few years now. They seem like one of the few fund managers that consistently outperform. It will be interesting to see how they perform in this bear market, although I think I read most big funds tend to outperform in bear markets, and slightly underperform in bull markets, generally.

I was gonna buy a little bit of their aggressive fund, but never filled out the form you need to print out and mail in.
17   clambo   2022 May 8, 7:30pm  

Primecap Odyssey Funds are still open to new investors.
18   NuttBoxer   2022 May 8, 8:50pm  

RWSGFY says
The "nothing left in the accounts" didn't happen then and I doubt it will happen now.


I remember hearing from more than a a few people on '08 that they had to start over(younger people), or could no longer afford to retire. Hopefully those same people haven't repeated their mistakes this go round.
19   clambo   2022 May 8, 9:43pm  

I heard stories about people losing money in 2008, one was my father ($600,000).
He didn’t listen to me and held inherited Wachovia stock; I previously advised him to sell it and buy a mutual fund.
He was 87 or so and he did keep working for a while.
I rode the stock market down in 2008 and sold nothing.
As soon as I had a little new cash I bought some things in early 2009 (AAPL).
If you want to lock in a loss, remember to sell the dip.

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