what % of your bankroll do you like to keep in the stock market vs how much cash on hand / high interest savings account / redeemable CDs or w/e do you prefer to keep in case you start losing?
The real question is how much cash do you need to have readily accessible. That has nothing to do with a BR percentage and more to do with how much you need to go on a trip or how often you want to get more cash out of the bank or wherever else you rest it.
My advisor said that for needing to liquidate into cash often a tax free bond fund for the state you live in is the best place to park cash. You earn about 4% to 5% annually but it is federal, state, and local tax-free. This effectively at least doubles the return on your money so you would need to earn 8% to 10% elsewhere to have the same return on your money after taxes. But that really depends on the tax structure for where you live, how much your state's tax-free bond fund returns and your tax situation. It is tough to get 9% return guaranteed in the market. You can get 9% or 10% average over time but then you start talking CE maximizing versus EV maximizing for investing options.
I know I didn't directly answer your question but I hope you found my answer helpful.
Dont know about the rich guys but my near $40k BR is in a safety deposit box ( $30k) Ann the rest in a shoebox to take out on trips. The $30k are in three envelopes in Safety box, two of which have not been opened in a couple of years, the other has been opened and closed several times as my BR has been swinging between $28k and $40k.
Any recommendations on where to stash $20k?
In Canada we have the TFSA (tax free savings account) which allows you to benefit from investments tax free so that bypasses your concern. But I don't know of any 4% to 5% returning bonds here, tax free or otherwise. The best I can find is like 2% return on GIC which is like a CD and those aren't even redeemable so you have to wait a year or more.
I guess to rephrase your question, how many max bets do you want to keep liquid vs how much do you want to just stick into the market and forget about it? I guess if you invest in EFTs you can always just sell them too if you run bad and need to free up more cash. Like that process probably wouldn't take too long.
Partly it depends on how aggressively you are sizing your bets. Like if you had a 300 max bet bankroll you could probably keep as little as 50 max bets liquid and put the rest in a diversified holding of various EFTs, investing say 1/4 of future winnings and spending 1/4 on your normal expenses or w/e and putting the other 1/2 into your liquid cash to cover swings.
Last edited by Meistro123; 03-30-2017 at 12:09 PM.
[QUOTE
Zee. The banks have a zip up bag for biz accounts. It holds $70k. $60k across and $10k on top. Zipped closed it looks like you're carrying a brick. Maybe use it as a weapon if that Stetson guy ever hunts you down. [/QUOTE]
On longer trips, I bought a belt with a pouch I use that goes under my pants. If worn properly, out look big in the right place, lol.
I personally have as little as possible in the stock market. I've thought about getting into the stock market, but it's not something I care to keep up on and it's always been more of a headache for me than it's been worth. I only have my 401k is in the stock market. The rest of my stuff is in bonds/CD's/savings.
I usually have enough for a few day trip on hand. The rest of my BR is in a higher rate savings account. I have a little in checking for paying bills and stuff. Everything else is tied up in CD's and bonds.
My stuff could probably be better managed. I'm not a finance person.
Depends on your bankroll and how much of it you need accessible at a time (as well as how much you'll need with a quick downturn). If you're playing very strong games (ie: not CC BJ), then those downturns don't happen as frequently and less $$$ is needed in reserve.
"Everyone wants to be rich, but nobody wants to work for it." -Ryan Howard [The Office]
Meistro and fellow Canucks
TFSA's are a great tool to earn tax free income. Other than this year, as I slow down my affairs, I've maxed kut on the contributions to both my wife's and my TFSA.
Maxing out with shitty GIC rates and bank interest rates is not very smart. You are FAR better off contributing with a TFSA set up with one if the major brokerage houses, with buy sells, calls etc free from both regular taxation and capital gains taxes. I've done exceptionally well with those accounts.
I believe there is some sort of equivalent program in the US.
Had a bad experience with an advisor too.. 2008 was my introduction to the stock market. Had some stuff invested in more volatile things and when it started to crash I told him to move it. He didn't. Told him to move it again. He didn't. Eventually figured out how to move it myself. Got a nasty phone call from him. Apparently he got money off of me having it invested there. Lost a lot more dealing with him than if I never bothered in the first place.
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