[inda50]

Originally Posted by TrudyM

I have diversified greatly, and was not hit too bad in recent events. Or at least I don't think of it that way because I never saw the bubble gains as real. That said we plan on refinancing our sons house so we have a stable income. He has a good job and would never stiff us. That said in order for it to be arms length and make the payments deductable for him (and income for us but at our lower tax rate) the rate has to be the same or not much lower than what he can get elsewhere. This has the side benifit of avoiding state inheritence taxes in some states (Fed not an issue we don't have that much)
This was suggested by the investment bankers and hedge fund managers in my family.

Hope this helps

Great advice I think for safe, investing. Everyone wins, you, the children. You get to help family and yourself. Sort of like the good old days.

We are in for alot of inflation in the next few years. Perhaps another alternative is gold.

[sbm]

Not true that deposit insurance is reverting to $100,000 at year-end. Per the FDIC website "As of May 20, 2009 deposits at FDIC insured instituitions are now insured up to at least $250,000 per depositor thorugh December 31, 2013. On January 1, 2014, the standard insurance amount will return to $100,000 per depositor for all account categories except for IRAs and other certain retirement accounts which will remain at $250,000 per depositor." (I'm not that smart, I just work at a bank and know where to look).

[conn8757]

Golly Cabo - I think if it is money you might need in the next 5 years, Boomer gave some good advice. I might look at some tax free bonds - My personal money I know needs to last 20-30 years so I have 30% in equities and 70% in cash and bonds (bonds are 45% - cash 25%). Our financial advisor thinks I should be 70% bonds 30% equities, but I need the comfort of the cash reserve so I know I can get by for 3-5 years if the market tanks again. I am in a "trust no one" mode with my money after the whipping we took the past couple of years. I did keep working 2 years longer than I had originally intended so that helped. I may look for part time work next year for an additional cushion if the picture doesn't get better. Good luck - being able to sleep is the key - upset stomach just makes you spend your money on PeptoBismol.

[scotsman]

Originally Posted by KayakerNC

Index funds with a guarantee?
Or did you utilize some sort of an annuity package?

Sounds like Bernie Madoff is out on bail. When anyone promises 13% returns on equity stock index funds it is time to run for the door. No index fund can promise these returns.

[k2at]

Like the rest of us, I took a beating in the stock market over the past several years. When the market was going up 14000, I thought I was a genius. Then when it tanked at 7000 I came to the realization that at my age 68, it is better to be safe (sleep factor) than sorry. I have therefore been systematically taking my money out of the market and putting it in CD's. I am quite sure that the market will eventually return to the pre crash highs, but time is working against me. I don't want to be a millionaire at 90.

I know what to expect from my CD's and I don't have to worry about another financial setback when the stock market takes another dive.

There is so much corruption in our country that I just don't trust the stock market any more. My goal is to get out systematically and take the least losses possible.

I say I am not a gambler by nature, but afterall how is playing poker and different from playing the market.

Thank god my retirement is in a fixed income for life and not in a 401k.

[senior citizen]

...

[TrudyM]

Originally Posted by senior citizen

This may not be the wise path to follow.........but we know a lot of people with similiar and higher amounts who tucked it away as cash in safety deposit boxes or safes. Other monies were kept in various money market accounts and checking accounts. This practice may be more widespread than people are aware of.

Cash is King ultimately.

At the time, the fear was of the banks failing. The dilemma in this choice is "What does one do with all the cash" when it is time to relocate to TV? Airlines xray your carry on bags. If you drive through the wrong state and get pulled over, large amounts of cash may be confiscated as drug money. Does anyone have an experience with this?

I do not think that people who had their money in federal insured banks lost a dime, so long as each account was under the insurance limit. Many accounts, many banks if it makes you feel better, but under your mattress, earning no income, your kidding right.
Withdraw huge amounts in cash from any bank, and you will end up on a federal watch list for sure. As I understand it cash deposited or withdrawn over ten thousand is reported to the watchdogs. We won't need our security clearance in retirement but I wouldn't want to end up on a watch list.

[BobKat1]

I'd really be hesistant about travelling, either by plane or car, with LARGE sums of cash. Too many bad or unexpected things can happen. I agree that having $$'s in FDIC insured accounts is the way to go if one wants to put all of their cash someplace.

Remember that recent news story of the woman in Israel (I think) who supposedly had over a million dollars in her mattress and it got hauled away?

[Campbell soup]

I would say keep it in the stock market.....

I have been buying stock at these great prices!

I sold a bunch when the DOW was at 14000 and will again. Just hang in there.


If you are really that nervous take out a little to take a loss...and you will do better on your taxes.

Real Estate is still a good investment if you are looking a few yrs down the road.

[Boomer]

Oh dear! Please tell me that there are not retirees out there, headed south, down the interstates, schlepping suitcases full of cash, across all those state lines for immortal porpoises or whatever. Oh dear! Oh my! Please tell them not to do that.

All kidding aside. Carrying around large amounts of cash is not smart and could be really dangerous. Trudy and BobKat are right. FDIC insured accounts are where some people like to stash cash. Look at the FDIC website for more info.

Boomer

[Sgtsixpack]

Buy a Boat- Sounds silly but when K2at mentioned the market liken to playing poker and real estate (motgages) about the same why not invest a good sized boat that you could probably get cheap now. Sound corny but not fishy like the others are.

[ChattanoogaTn]

I agree with this statement and after losing CONSIDERABLY while waiting on the market to "come back" month after month for almost a year we finally switched 50% of my money to a "Variable" GUARANTEED Annuity that pays 6% for life and 6% is always adjusted once a year so that "if" portfolio balance goes up the 6% "Yield" is adjusted to higher balance Guaranteed NEVER to drop below HIGHEST Market Value on any given anniversay date on your YIELD even though portfolio balance may drop 6% rates are locked each anniversary year and..... you are still invested in Market either aggressively or consersatively. However your money is locked for 7 years to which if you pull it out 1st year it will cost 7% ....if you pull it out 2nd year 6% .... 3rd year 5% ...4 year 4% ....3 year 3% etc. After 7 years you will not pay any penality for taking out and your 6% can grow as your portfolio grows (adjusted for balance every year) and will never go down in yield even if balance drops. We have ours thru MetLife...#1 Rated Company

Originally Posted by Irish Rover

I don't think I would pull out of the market right now. Personally, my portfolio has been bouncing back so I'm straying put. If I did make a move it would probably be into bonds. Good luck.

[ChattanoogaTn]

My Thoughts EXACTLY!!

Originally Posted by k2at

Like the rest of us, I took a beating in the stock market over the past several years. When the market was going up 14000, I thought I was a genius. Then when it tanked at 7000 I came to the realization that at my age 68, it is better to be safe (sleep factor) than sorry. I have therefore been systematically taking my money out of the market and putting it in CD's. I am quite sure that the market will eventually return to the pre crash highs, but time is working against me. I don't want to be a millionaire at 90.

I know what to expect from my CD's and I don't have to worry about another financial setback when the stock market takes another dive.

There is so much corruption in our country that I just don't trust the stock market any more. My goal is to get out systematically and take the least losses possible.

I say I am not a gambler by nature, but afterall how is playing poker and different from playing the market.

Thank god my retirement is in a fixed income for life and not in a 401k.

[ricthemic]

Looking at existing houses now in TV. Does it make sense to buy the house cash by taking out of stock market? Planning on six months in TV. Have existing house up north paid off. Leaves us with a decent pension, SS and some cash.

[jrjr729]

The original question had to do with investing $250k taken from the stock market. One really needs more information about you to give an answer that meets your needs. For example, is your total household net worth greater than one million dollars? If it is you may want to purchase some life insurance with part of the money to cover estate costs. It is possible Congress may not modify the estate tax allowing it to revert to the one million exemption after 2010.

Another thing how large is your portfolio? Does the $250k represent more than 50% of it? If so, and you are absolutely against owning individual stocks, I would suggest mutual funds. In that case split the money into five equal parts of $50k each and buy five different funds from the same fund family. Vanguard has pretty low expense ratios, so I would start there. Use Morningstar to help identify particular funds. Invest the money as follows: An S&P 500 index fund, A bond index fund, a technology index fund, a high yield fund and an international fund. After 12 months and one day re-evaluate and shift your fund allocation back to 20% in each fund. (If the money is in tax deferred accounts you can shift every six months since you won't have to worry about tax consequences.)

Still, I generally agree with some of the other posts that you probably shouldn't pull the money out, now. Yes, the market cold dip again but it might not. I think the worst is over and that the economy is safe. Over the next five years the markets should rebound nicely.

If you do not like your current mix of stock investments, consider becoming a bit more defensive y buying consumer staples and shifting into high dividend paying stocks.

Finally, although annuities have there place in some portfolios they might not fit in yours. After all, if you have a well funded pension that plus social security means you already have two annuities. Do you need more?