[sneak]

Short answer: Dump it all in VFIAX and ignore it for about 30 years.

Alternately, wait for the housing market freefall that is scheduled to hit about 180 days from now, and buy a foreclosure or two.

EDIT: Cosigning the above recommendation about maxing out a Roth IRA each and every year as well, and of course maxxing out any company-matched 401(k) options.

[cityzen]

The problem (for me) with index funds is that you end up participating in stocks for companies you may not want. For example, I don't want a penny of my money to go to Facebook, Amazon, Google, etc. Here's the VFAIX top ten holdings:

Microsoft Corp Apple Inc Amazon.com Inc Facebook Inc A Berkshire Hathaway Inc B Alphabet Inc Class C Alphabet Inc A Johnson & Johnson Visa Inc Class A Procter & Gamble Co

It has always blown my mind that the answer for "retirement" now is to put your money in the online casino.

As a father of two young kids, the last thing I want to do is contribute to the erosion of any sense of privacy my kids may have in the future. Using Facebook as a tool for retirement is just as dumb to me as using Facebook for anything else.

[sneak]

Choosing to invest or not invest in Facebook does not change a single thing about whether or not society as a whole chooses to use Facebook and whether or not, via that use, Facebook becomes powerful and further erodes societal values placed around privacy. Facebook would still be Facebook (and thus dangerous) even if it were privately held.

Facebook is Facebook because they have an app that people love to use, and that gives them the power to sell and control placement in the communication between friends and acquaintances back to those same communities. They're not powerful because of their share price.

Index invest away. I have Facebook blocked at my router but I still own them via index funds.

[cityzen]

Cool, I think you missed my point, though. I personally do not want to have a penny invested in Facebook/Google/Amazon. I do not care about the gains or losses or the number of people that love to use their apps/services.

Money isn't everything.

[blaser-waffle]

There are ethical investing firms, and they offer ethical investing mutual funds and ETFs -- my wife holds a few of their offerings. Their performance isn't amazing.

You're also not obligated to buy an ETF -- you can create your own "index" without much effort. The OP's $80k would let them do that, were they so inclined. Maybe not all 500 in the S&P, but a lot.

[cityzen]

Eh, after seeing the pile of dogshit that VCs are pushing on the public markets lately, I've lost a lot of faith in publicly traded companies.

[oldsklgdfth]

What do you do for retirement? Do you not have a 401k that invests in some index fund?

[bko]

Your short answer suggests you cannot time the market but over the long run, stocks generally go up so they're a good long term investment. Also this answer touts the benefits of passive liquid investments with transaction costs associate with it.

Your second answer goes completely the other direction. The answer suggests to time an investment in real estate, the least liquid investment with the highest transaction costs a typical investor could buy.

No one knows what housing market will be like 180 days from now, no matter how many times they're interviewed on CNBC.

I like your first answer better.

[glofish]

overall awfully misguided advice. when you buy foreclosure you are buying all responsibilities for the home - past debts, mortgages, liens, future taxes, repairs etc - in addition you are betting that future appreciation will all pay off - not guaranteed at all. Homes are illiquid and a lot of trouble.

no one should just buy a foreclosed home without thorough preparation

[jweather]

Buying a foreclosure is the same as any other home purchase -- get an inspection and title search to know what you're getting into. You're not "buying all responsibilities" any more than you are when purchasing a home the "normal" way.

[glofish]

Saying just get title insurance is exactly what I meant you should be prepared to know what is required and is not something you should jump into thinking of it as easy money.

When you are buying a typical real estate the cost of title search and title insurance are usually part of the settlement process and are included automatically, you don't have to do anything, all gets done for you.

The problem is that with foreclosures that they often are sold via auctions where you don't get to inspect the home, you have to pay cash upfront, getting title insurance is not so given either. Plus you have to do it all yourself. All serious issues.

[lostmsu]

There will be plenty of pre-foreclosures.

[stevekemp]

Even if there were to be a massive freefall in housing it would take the banking system months, and probably years, to get round to processing all the mortgages which were in arrears.

Foreclosure is a slow, slow, slow process even at the best of times. People can avoid paying their mortgages and still be living in a property for many years. If you're imagining something that covers a significant amount of property that will take even longer.

[rayhendricks]

It will be 180days + unemployment + CARES act unemployment (13w) so the better part of a year before the real defaults start. Not that it won’t happen it will be much more slow motion that most people will be comfortable with.

BTW I just lost out on buying a house, the market is still there but it is much lower.

[neilgodwin]

So, you're saying no fall in prices in the short to mid term is expected?

[stevekemp]

I have heard people predicting a collapse of the housing market for almost a decade. I expect some areas will see a rise in prices, and some a fall.

Mass unemployment will cause problems for many, but at the same time lots of countries are essentially forbidding evictions and that has to have a somewhat balancing action for the short-term. How well that will hold up is an open question, and nobody knows the answer.

[Jeremy1026]

We are preparing to sell our current house and buy a new one. Our realtor (so grain of salt here) said that its currently a buyers market and that he expects it to remain that way at least through fall. But honestly, no one knows and there is no way to know.

[DSingularity]

Not necessarily. People are still buying houses. Interest rates are low.

[silicon2401]

Why VFIAX over VOO? does buying a foreclosure mean buying a house for cheap after the owners were unable to pay for it?

[blaser-waffle]

VFIAX is "Admiral Shares" and has a lower expense ratio compared to VOO. But it also requires a higher minimum investment -- $80k is over that limit.

Even if OP splits it into smaller, dollar-cost-averaging purchases they'll still be able to get VFIAX without a problem.

[neilgodwin]

I've heard that the decrease in prices is expected for business housing, not so much in residential. What are your thoughts on that?

[sneak]

I hear a lot of things. I personally believe that the net result of all of this in a few (3-5) years when the worst part of it shakes out is that a lot of people who used to have equity will now be renting, but living in basically the same areas/levels: this is going to result in a very large net equity transfer to those who have cash on hand or cash flows in the next few years, at the expense of wage slaves who get totally fucked because their employers collapse over the summer and unemployment skyrockets.

Lots of large companies are going to do big layoffs to survive. Many others are going to dump their entire workforces when they go under entirely. Large industries like travel and tourism and entertainment and gambling and the related services for same are going to get scaled back for years. Money for the non-wealthy (and by wealthy I include pretty much everyone who knows pointer math or web programming, as even having $-20k in assets if you're able to make $100k+ puts you far better off than most) is going to become harder and harder to come by. I expect this to result in a lot of evictions when the courts reopen, and lots of foreclosures about 3-6 months after the layoffs peak in 3-4 months. All of the figures I am guessing at here are +/- ~10 weeks and are sketchy guessing at best, because who the fuck knows what's going to happen the rest of the year with any potential second or third waves of disease, or governmental closure orders, or even the outbreak of another world war.

It sounds like you have savings and income. Personally, with all of this uncertainty, I'd guard both as carefully as you can. Millionaires can afford to take bigger risks right now, normal people with nest eggs generally cannot, as it's not certain that the jobs will be as plentiful or high-paying in the next ten years as they were the last.

If in doubt, stick with the index fund, and just "set it and forget it". If you want to get more actively involved (or if you don't plan to change cities much and don't already own a home), real estate is almost always a good long term investment as well.

My advice would be markedly different if you were asking about $8M or $800k and not $80k, but $80k isn't a ton of money these days (I'm guessing it's less than a year of your gross income) so I personally would go lower-risk for the first few hundred k before ramping up the potential for higher returns.

[glofish]

all speculation - nobody knows, everyone can claim anything, then survivorship bias will kick in, and those that happened to say the right thing will claim "expertise"