If someone is “managing” your money, they’re managing stocks and/or investments tied to stocks, even if it’s something like a direct deposit to a CMA.

High interest savings is pretty decent if you can find the right one, it’s a no-effort way to collect interest. Just make sure you can afford the bank’s rules like minimum amounts or any fees.

As far as someone else managing your money you left out a lot. Who and how? Money managers take fees one way or the other, they trade your money around based on whatever works for the business and not always what is best for the client. No matter what any trades will incur trade fees and capital gains taxes. Those gains and fees are losses that could have been avoided. I’ll stand by my original opinion.

[–] Trainguyrom@reddthat.com 1 points 1 day ago (1 children)

Based on my recent meeting with someone from the retirement planning arm of my bank, high interest savings is ideal for an emergency fund. If you're keeping 10-20k sitting around it's just going to keep losing value in any traditional savings account. But having the rest in an IRA or RothIRA (US-specific tax advantaged retirement accounts. Basically one is taxed as money enters the other is taxed as money exits, and there's limitations to try to prevent abuse by the ultra-rich) can lead to significantly higher interest. He ran a report of "if we took your 401ks that we're rolling together and they just lived in this account over the last 30 years of markets here's what you'd have" and the answer was actually a lot more favorable than I expected.

[–] RememberTheApollo_@lemmy.world 1 points 1 day ago* (last edited 1 day ago) (1 children)

IRAs are tied to stocks.

There’s no way to “avoid the stock market entirely” using this. Yes, you should balance how you want your tax burden to look in the future by deciding how you wish to invest in Roth or regular IRA. IRAs are also limited to how much you can contribute, whereas traditional stock investment does not.

I don’t want to get too deep in the weeds here for investing strategy. There’s pros, cons, and costs to each of these kinds of investment. People have to look at all of these, their personal capabilities, and risk tolerance. Personally, we’re (another key word here:) diversified across multiple investments and someone absolutely should take advantage of the same if they can.

[–] Trainguyrom@reddthat.com 1 points 1 day ago (1 children)

I wasn't the one who said to avoid the stock market. I just got the feeling that your comment I was replying to was saying to just place money into a high interest savings account and wanted to throw an alternate opinion out there

[–] RememberTheApollo_@lemmy.world 2 points 1 day ago* (last edited 1 day ago) (1 children)

Ah, sorry didn’t see the name change. No, that was never my intent. Diversification is a must.

[–] Trainguyrom@reddthat.com 1 points 1 day ago

No worries! Have a wonderful day!

[–] Lv_InSaNe_vL@lemmy.world 1 points 1 day ago (1 children)

So I do actually have a high interest account from Capital One it's very nice. But yeah there's a bunch of rules like minimum monthly deposits and it takes up to 5 business days to transfer money out of it. And because y'all are assuming, I also have a 401k and HSA maxed out, and a Roth IRA I put some money in each month.

But yeah I intentionally left out a lot because I am not a financial expert, which is the reason why I went with a broker anyways. But here are the answers for your questions

I have a broker through JP Morgan. I don't know the guy and don't talk to him outside of the once a month he calls me to update me on what's going on.
I don't know what stocks he is trading and I don't care. Every once and a while I'll ask him to invest in something I think would be good like Nvidia or AMD but by the time I hear about something he already moved money around
Of course he is working for the company and not me. I am not that wealthy haha
He consistently makes me 4-6% gains which is plenty for me.

[–] RememberTheApollo_@lemmy.world 2 points 1 day ago

I’m not continuing this discussion to change your mind. If you’re happy with what you’ve got you’ve no need to listen to me. Big consumer investment houses are there to make money off you. Everything you listed is exactly what I mentioned as being a reduction in your ROI and incurring fees and taxes. For instance, we’ve invested in QQQ (feel free to check it) for more than a decade using the strategy I mentioned first. Even over the last 5 years it’s had 110% return. $10k is now more than $20k without bothering to calculate DCA or returns investing. Now do that across more index funds. Even if averages 7% with gains/losses and no fees or capital gains you can see that this comes out far ahead.

All that said, good luck.