Jul 11, 2017
208
112
41
Status
Attending Physician
What should I do/invest with $60k (bonus)?
37yo, late start to medical field, no student loans. Wife works part time making 20k per year.
Have 3 kids, saving monthly for college through 529 (projected $180k for their college each).
Already making extra payments on mortgage with $20k per year (9 payments left) interest is 3.75%
Planning to pay off $15k auto loan this year
I max out 401k (no employer match unfortunately)
Have a $20k cash emergency fun
I save an additional $30k per year outside of the bonus
Have 20% in bonds, 10% in mutual funds, rest in individual dividend stocks with DRIPs setup (total value around $250k)
I need to build up my portfolio, but hesitant with current evaluations.
Already do backdoor Roth’s yearly
Any suggestions? Looking for 4-5% return
 

managedcarefin

2+ Year Member
Oct 18, 2015
68
95
71
Status
Non-Student
Real Estate, assuming you live in a low cost state, try to buy some cheap real estate rent it out....? Profit. However, it will not be easy.
 
  • Like
Reactions: DoubleBogey

Stroganoff

Never give up.
15+ Year Member
Nov 6, 2003
41,597
23,747
381
Planning to pay off $15k auto loan this year
What APR? Could just pay in full and be done with this.

Have a $20k cash emergency fun
Obviously this is personal preference and dependent on many things like job stability, home and auto ownership, financial picture and access to other liquidity, but I feel like $20k emergency fund is low for married couple with 3 kids. I guess you could tap into the taxable account as needed, but then you'd be forced to withdraw even if the market is low.

Have 20% in bonds, 10% in mutual funds, rest in individual dividend stocks with DRIPs setup (total value around $250k)
I prefer funds over individual stocks, even dividend producing ones, but to each his/her own. I read other forums that encourage people to gradually move out of individual stocks.

Any suggestions? Looking for 4-5% return
What's your desired Asset Allocation, 80/20? Stocks are returning around that, so maybe contribute more to your taxable account index funds in accordance with your AA?

Could just pay off the mortgage and be done with that too, realizing your rate is pretty low.

Are peer-to-peer companies like Prosper and LendingClub still viable options? I haven't kept track in recent years.
Nevermind, looks like high default rate. The Lending Club Experiment
 
OP
D
Jul 11, 2017
208
112
41
Status
Attending Physician
What APR? Could just pay in full and be done with this.


Obviously this is personal preference and dependent on many things like job stability, home and auto ownership, financial picture and access to other liquidity, but I feel like $20k emergency fund is low for married couple with 3 kids. I guess you could tap into the taxable account as needed, but then you'd be forced to withdraw even if the market is low.


I prefer funds over individual stocks, even dividend producing ones, but to each his/her own. I read other forums that encourage people to gradually move out of individual stocks.


What's your desired Asset Allocation, 80/20? Stocks are returning around that, so maybe contribute more to your taxable account index funds in accordance with your AA?

Could just pay off the mortgage and be done with that too, realizing your rate is pretty low.

Are peer-to-peer companies like Prosper and LendingClub still viable options? I haven't kept track in recent years.
Nevermind, looks like high default rate. The Lending Club Experiment
I was planning to pay the car loan off in one shot this year (apr around 3.5%)
I’d like to get more involved with index funds and will likely average at $10k each quarter.

It wouldn’t be hard to have emergency fund at $40k, would like to have a higher yield than your general savings account, which is why I haven’t increased it to that level.

Eventually I would transition to less stocks and more fixed income in my late 40s-50s.

Rental properties require too much maintenance in my opinion. Looking more into commercial real estate with 2 other physicians.
 

LookForZebras

2+ Year Member
Oct 8, 2016
86
64
71
Status
Attending Physician
Vanguard index funds are a great way to go if you don't want to dedicate a lot of time to your investments or put much effort learning about a new investment type.
 

calvnandhobbs68

I KNOW NOTHING
7+ Year Member
May 20, 2010
3,217
1,172
181
Status
Fellow [Any Field]
What APR? Could just pay in full and be done with this.


Obviously this is personal preference and dependent on many things like job stability, home and auto ownership, financial picture and access to other liquidity, but I feel like $20k emergency fund is low for married couple with 3 kids. I guess you could tap into the taxable account as needed, but then you'd be forced to withdraw even if the market is low.


I prefer funds over individual stocks, even dividend producing ones, but to each his/her own. I read other forums that encourage people to gradually move out of individual stocks.


What's your desired Asset Allocation, 80/20? Stocks are returning around that, so maybe contribute more to your taxable account index funds in accordance with your AA?

Could just pay off the mortgage and be done with that too, realizing your rate is pretty low.

Are peer-to-peer companies like Prosper and LendingClub still viable options? I haven't kept track in recent years.
Nevermind, looks like high default rate. The Lending Club Experiment
Ya lending club blows. I only had about 5K in a Roth IRA in there but it only averages returns of like 3-4% over the past few years. The default rate is outta control which I should have expected with unsecured loans. I’m rolling money over to a different Roth IRA account every year from that account, problem is you have to wait for people to pay on their loans to pull money out so it’s a stepwise process.
 

abolt18

I regret nothing. The end.
5+ Year Member
7+ Year Member
Apr 24, 2012
2,559
1,268
181
Status
Resident [Any Field]
I was planning to pay the car loan off in one shot this year (apr around 3.5%)
I’d like to get more involved with index funds and will likely average at $10k each quarter.

It wouldn’t be hard to have emergency fund at $40k, would like to have a higher yield than your general savings account, which is why I haven’t increased it to that level.

Eventually I would transition to less stocks and more fixed income in my late 40s-50s.

Rental properties require too much maintenance in my opinion. Looking more into commercial real estate with 2 other physicians.
Ally bank high yield savings account now gives like 2.2% right now! It's where I keep my emergency fund.
 

werd

Senior Member
15+ Year Member
Feb 13, 2004
842
42
361
Visit site
Status
Attending Physician
i'd say increase your emergency fund to cover 6 months of cash flow, then put the rest in the stock market. I use vanguard and mostly index funds. as others have said above, you can get a decent yield from online savings accounts, so those are good places to keep your emergency funds.
 

d2305

SDN Gold Donor
Gold Donor
5+ Year Member
May 10, 2013
575
164
131
Pensacola FL
Status
Non-Student
Open an account at Vanguard or Fidelity and start buying no load mutual funds. Buy index 500 if you want hands off, sector funds are fun if you want to get involved.
 

Womb Raider

5+ Year Member
Aug 20, 2013
3,604
2,949
131
Status
Resident [Any Field]
Agreed with the above to definitely get rid of individual stocks... It’s taking on unnecessary risk for no reason. Dividends are also not tax efficient so if those dividend stocks aren’t in a tax-protected account then you’re doing yourself a big disservice. Since your bonus is going into a taxable account put it into something tax efficient like total stock market index funds/ETFs at vanguard or muni bonds. REITS as advised above are very tax inefficient. Also consider hedging against the inevitable stagflation of the US economy in the near future - consider gold or international stock indexes.
 
Last edited: