ilovedolphins
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Post by ilovedolphins on Sept 3, 2019 19:22:25 GMT -5
My parents gave me about $20,000 in savings bonds and I can't decide whether to keep them or cash them in and invest in the stock market and hope to get better returns. Right now the savings bonds are at 1% and 2.41%.
I would like to get a better return on them but at the same time I would like to keep them because they are "safe" and I won't lose money on them.
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Gardening Grandma
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Post by Gardening Grandma on Sept 3, 2019 20:47:55 GMT -5
My parents gave me about $20,000 in savings bonds and I can't decide whether to keep them or cash them in and invest in the stock market and hope to get better returns. Right now the savings bonds are at 1% and 2.41%. I would like to get a better return on them but at the same time I would like to keep them because they are "safe" and I won't lose money on them. Why not split the funds? Put 10k into a CD and invest the other 10k. It doesn’t have to be either/or
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ilovedolphins
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Post by ilovedolphins on Sept 3, 2019 20:52:46 GMT -5
I had thought about taking $10,000 and investing it.
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countrygirl2
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Post by countrygirl2 on Sept 3, 2019 21:40:11 GMT -5
If they are I bonds like mine they are going gangbusters, don't cash them. If they are regular EE bonds, not earning much. Mine have doubled in value and most have 15 to 20 years to go yet. Wonder if we will ever get the money out of them, they will be worth a small fortune. $60k now worth $122k.
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tskeeter
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Post by tskeeter on Sept 4, 2019 0:15:31 GMT -5
My parents gave me about $20,000 in savings bonds and I can't decide whether to keep them or cash them in and invest in the stock market and hope to get better returns. Right now the savings bonds are at 1% and 2.41%. I would like to get a better return on them but at the same time I would like to keep them because they are "safe" and I won't lose money on them. Gee, at 1% return, your “won’t lose money” savings bonds are losing about 2% in buying power every single year you hold the savings bonds. A guaranteed loss. In 10 years, your $20K worth of bonds, with the accumulated interest, will be guaranteed to buy about $16K worth of goods and services. I guess that I don’t consider an investment that is guaranteed to lose buying power every year to be a safe investment.
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MN-Investor
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Post by MN-Investor on Sept 4, 2019 0:30:32 GMT -5
I look at this from a Boglehead's point of view: How does it fit into your asset allocation? The Bogleheads' approach to investing is to decide on an asset allocation you can live with - such as 80% stock / 20% bonds - and re-allocate when you get out of balance (many Bogleheads re-balance only once a year). Bogleheads believe in investing in low expense ratio index funds. Savings bonds can certainly be part of your portfolio, but you need to consider how the bonds fit into your entire portfolio. If are do have an 80/20 asset allocation and these bonds upset that allocation by more than 5% (or whatever number you use for re-balancing), then you sell them and buy stock. The Bogleheads' website has an excellent Wiki with hundreds of articles about their philosophy and investing topics.
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Post by The Walk of the Penguin Mich on Sept 4, 2019 8:45:27 GMT -5
I have a stack of EE bonds I collected in the 1990s. At this point, they are earning about 5% interest, and as they are only a small part of my investments, I’m just letting them ride. It all depends upon what percentage the $20k is of your total investments.
I consider mine a part of my cash investments, along the line of my savings account.
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MN-Investor
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Post by MN-Investor on Sept 4, 2019 13:42:42 GMT -5
I have a stack of EE bonds I collected in the 1990s. My husband's employer was big on employees buying EE bonds so my sweetie had a stack of 163 bonds issued from Nov-83 thru Jul-05. That was the strangest feeling when the first bond matured in November 2013. 30 years had passed! My husband got the biggest kick out of taking each bond to the bank and cashing it. He paid $25 for that first $50 bond and received $115.32 when he cashed it. The fun part for me: I got the $115. He got the 32 cents!
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Regis
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Post by Regis on Sept 4, 2019 16:31:04 GMT -5
How long until you'll need that $20k for something?
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ilovedolphins
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Post by ilovedolphins on Sept 4, 2019 16:34:44 GMT -5
How long until you'll need that $20k for something? I don't know. I have plenty of cash to cash flow something up to $20,000. These have been sitting in my safe and I haven't had to use them.
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phil5185
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Post by phil5185 on Sept 4, 2019 17:24:50 GMT -5
My parents gave me about $20,000 in savings bonds and I can't decide whether to keep them or cash them in and invest in the stock market and hope to get better returns. Right now the savings bonds are at 1% and 2.41%. I would like to get a better return on them but at the same time I would like to keep them because they are "safe" and I won't lose money on them. As you probably know, you can't do both. Savings items (CDs, bonds) provide safe storage of money, ie, wealth-preservation - they are designed to offset inflation. And equity (stocks) provide wealth-building but at a risk, they are designed to substantially outpace inflation. And splitting your money means that you don't get much of either. So you are faced with the decision - are you in your wealth-building years or your wealth-preservation years? (As usual, I would put the whole thing in the SP500 Index Fund & let it grow.)
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Post by The Walk of the Penguin Mich on Sept 5, 2019 13:54:56 GMT -5
I have a stack of EE bonds I collected in the 1990s. My husband's employer was big on employees buying EE bonds so my sweetie had a stack of 163 bonds issued from Nov-83 thru Jul-05. That was the strangest feeling when the first bond matured in November 2013. 30 years had passed! My husband got the biggest kick out of taking each bond to the bank and cashing it. He paid $25 for that first $50 bond and received $115.32 when he cashed it. The fun part for me: I got the $115. He got the 32 cents! At this time in my life, it was the easiest way I found to save. The bonds had to be held 6 months, and needed to be cashed at a federal savings bank. That was enough to make me think twice about spending savings, since it was entirely too easy to access savings. When I left that job, I stopped buying bonds. By then, I found it easier to keep my hands off emergency money, so still saved the same amount in a different vehicle.
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Deleted
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Post by Deleted on Sept 5, 2019 13:58:51 GMT -5
The first way I saved was with EE bonds through payroll deduction too. I had $100 taken out of every check which was quite a bit when making $6.50/hour. It's how I got the $3500 for the down payment on my first house. I don't think our company even offers that anymore.
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countrygirl2
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Post by countrygirl2 on Sept 8, 2019 8:27:13 GMT -5
You can't even buy paper bonds now. I tried to enroll in the bond online deal when it first came out and could never get it going. I gave up. It may have been streamlined by now, I never tried it again.
I go in to online calculators every year or so to calculate mine, the gov used to have an online calculator you could update, the easy one is gone now. I found one but so far have to re enter all the bonds to us it, why I only do it about once a year.
They were and easy vehicle to save with. I remember in school, you could take something like a quarter a week and put a stamp in a booklet, when you got it filled could redeem it for a bond.
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MN-Investor
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Post by MN-Investor on Sept 8, 2019 9:41:15 GMT -5
I go in to online calculators every year or so to calculate mine, the gov used to have an online calculator you could update, the easy one is gone now. I found one but so far have to re enter all the bonds to us it, why I only do it about once a year. The Treasury Department's EE Bond Calculator page has a link to How to Save Your Inventory. Basically you're saving the data in an html format which you can open again with your internet browser. That's what I have done with my 50+ EE bonds. No way am I re-entering that list again!
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countrygirl2
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Post by countrygirl2 on Sept 8, 2019 13:06:07 GMT -5
I have 75, don't enter the bond numbers. I did save it in documents, I think I can reopen it and update, we will see.
Used to be I saved it and could just pull it back up and could automatically update, I like to see the money accumulate, LOL!
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