LOST THOUSANDS in $TSLA today

[disneysteve]

I can't remember when exactly, it's been 2 or 3 years but I moved the kids 529 into a straight CD. I couldn't take it going down, even though we were in an age based allocation and 2 where in college, I switched. I'm fine not making any more money in that account, we have enough in them to pay what we planned. But I couldn't stand it going down. I understand how you feel and am sorry.

I had my daughter's 529 in the age-based portfolio. When she got into high school, so maybe 10th grade, I shifted it more conservative. I left the funds that were in the age-based portfolio alone so maintained that stock exposure, but I started putting new contributions into the fixed-income portfolio so the allocation gradually shifted over those final couple of years.

[Like2Plan]

One additional thought regarding the TSLA stock being in a a tax advantaged account. If you do incur a loss, you can't tax loss harvest.

On the other hand if you held TSLA in a non tax advantaged account, long term capital gains receive a more favorable tax rate than ordinary income. In fact, you pay 0% LTCG tax for MFJ on taxable income up to 80k (2020 tax rates) and 15% LTCG tax on income between 80,001k and $496,600. Additionally, stocks receive favorable treatment in your estate. They get a stepped up basis, so it is possible your heirs would not have to pay any capital gains tax on appreciated stock. (I would assume you have set an estate plan with a lawyer for your disabled child apart from the ABLE account? )

Finally, who would manage all these individual stocks if god forbid something happened to you? Have you briefed them on your plan? Would they know when to sell them?

[LivingAlmostLarge]

Yeah you can't pay taxes on gains either in tax advantaged accounts. But in this case i sounds like part of the problem is that Scallywag is getting unnerved by holding tsla in an account she doesn't want to lose money. Totally legitimate concern especially for your kids. Makes me more crazy as well. So the best answer is stop gambling with money you can't afford to lose especially short term money.

[Scallywag]

Yeah you can't pay taxes on gains either in tax advantaged accounts. But in this case i sounds like part of the problem is that Scallywag is getting unnerved by holding tsla in an account she doesn't want to lose money. Totally legitimate concern especially for your kids. Makes me more crazy as well. So the best answer is stop gambling with money you can't afford to lose especially short term money.

Well, that account isn't only for my daughter's Coverdell. As I said, the reason I am slightly hesitant to sell it all is because it DOES have a long term component to it in that if we didn't cash it out to pay for her tuition then it can be rolled over into an ABLE account eventually and the time-frame for that account is at least 40 years! Also, DD has a 529 which is conservative, I kept stocks in the Coverdell for the market exposure.

To be honest, I am one of those people who IS quite aggressive, because, this is all money for my son who may need it in 40 years' time. That long time duration is what makes me hesitate about pulling the trigger so fast. Also, the account isn't just TSLA. It also has a couple of other stocks (MSFT and JNJ) with the rest vannila 3-fund Boglehead portfolio. Not sure if that makes you guys have different input for me?

Yeah, I teared up, because WHO likes to see huge red numbers next to their kids' accounts? BUT I've since calmed down because again my horizon is not just the 4 years to Junior Year at University but much further out to 40 years for DS (unless something REALLY drastic happens and we lose everything)

[LivingAlmostLarge]

Well, that account isn't only for my daughter's Coverdell. As I said, the reason I am slightly hesitant to sell it all is because it DOES have a long term component to it in that if we didn't cash it out to pay for her tuition then it can be rolled over into an ABLE account eventually and the time-frame for that account is at least 40 years! Also, DD has a 529 which is conservative, I kept stocks in the Coverdell for the market exposure.

To be honest, I am one of those people who IS quite aggressive, because, this is all money for my son who may need it in 40 years' time. That long time duration is what makes me hesitate about pulling the trigger so fast. Also, the account isn't just TSLA. It also has a couple of other stocks (MSFT and JNJ) with the rest vannila 3-fund Boglehead portfolio. Not sure if that makes you guys have different input for me?

Yeah, I teared up, because WHO likes to see huge red numbers next to their kids' accounts? BUT I've since calmed down because again my horizon is not just the 4 years to Junior Year at University but much further out to 40 years for DS (unless something REALLY drastic happens and we lose everything)

No. But here are the follow up questions I would ask.

1. How much in 529 and how much in Coverdell?
2. How much are you estimating college will cost? 2 years Junior college and 2 years at University
3. How will you feel if there isn't enough to cover college for your daughter? Will you be distraught if there isn't any money for a ABLE account?

It sounds like your daughter is 16 and a junior in high school. You say her 529 is conservative. I think the best way both for advice and yourself is to plan a 4-10 year cashflow schedule. That's what I would do. Here's what I would start

Year 1 2022 Fall - Tuition
Year 2 2023 Fall Tuition
Year 3 2024 Fall Tuition
Year 4 2025 Fall Tuition

Total cost needed $X

Current amount - 529 and Coverdell

Then I would breakdown what each is invested in. Also it would make sense to tell us how much you currently are adding monthly and are you going to cash flow investments. I wouldn't count on Coverdell to fund ABLE. I would just start funding able.

I think from there it help you gain clarity as to what makes sense. Since you are in California it can be reasonable college. Not sure if your daughter is planning on living at home. Or planning on working. Or any internships. Just stuff to consider. With more details it might help people give more tailor specific advice. I certainly would if I knew how much we were talking about and how much you were needing?

[Like2Plan]

Well, that account isn't only for my daughter's Coverdell. As I said, the reason I am slightly hesitant to sell it all is because it DOES have a long term component to it in that if we didn't cash it out to pay for her tuition then it can be rolled over into an ABLE account eventually and the time-frame for that account is at least 40 years! Also, DD has a 529 which is conservative, I kept stocks in the Coverdell for the market exposure.

To be honest, I am one of those people who IS quite aggressive, because, this is all money for my son who may need it in 40 years' time. That long time duration is what makes me hesitate about pulling the trigger so fast. Also, the account isn't just TSLA. It also has a couple of other stocks (MSFT and JNJ) with the rest vannila 3-fund Boglehead portfolio. Not sure if that makes you guys have different input for me?

Yeah, I teared up, because WHO likes to see huge red numbers next to their kids' accounts? BUT I've since calmed down because again my horizon is not just the 4 years to Junior Year at University but much further out to 40 years for DS (unless something REALLY drastic happens and we lose everything)

Scallywag,
Starting on Oct 9, 2007, the S&P index started a 17 month decline (56.8% by the time it reached its low). It took 49 months to recover 'til Mar 28, 2013.
My DS graduated high school in 2006. It is worth noting that the market had not recovered to its original level until after DS graduated from college. But, this decline did not impact us. DS had been in an age based portfolio in his 529 which we moved to 100% bonds by the time he graduated high school.

I think you are seriously underestimating your reaction if something really drastic happens and you lose everything --if you get so upset by a temporary market correction.

Also, I agree with LAL. You should keep the accounts separate. Put the long term investments in the ABLE account. Put the short term investments in your coverdell.

[disneysteve]

Folks, keep in mind that everyone's situation is different and we only see a little slice of it when a question or comment comes up. We don't know the big picture. Something that looks super risky might make perfect sense in the overall plan. And everyone's risk tolerance is different. While I might choose to be conservative in my kid's college fund when they are in high school, someone else might be comfortable being much more aggressive because they have a good back up plan if things go south. So let's try to be a little less judgemental (which I freely admit I've been guilty of myself more than once).

[Scallywag]

Folks, keep in mind that everyone's situation is different and we only see a little slice of it when a question or comment comes up. We don't know the big picture. Something that looks super risky might make perfect sense in the overall plan. And everyone's risk tolerance is different. While I might choose to be conservative in my kid's college fund when they are in high school, someone else might be comfortable being much more aggressive because they have a good back up plan if things go south. So let's try to be a little less judgemental (which I freely admit I've been guilty of myself more than once).

Thank you, Steve. I will think long and hard before venting here again as it gives some people an opportunity to beat you down while you're already low and think they know better than you do and or that I lack basic math skills. I know exactly what I am doing and what the risks are, thank you very much. PLAN B for her college is a conservative 529.

I DO NOT time the markets anymore. I was venting because I was feeling down - I didn't panic sell at all, BUT WAS BUMMED OUT at the "temporary market correction" as someone put it. So I vented. So shoot me.

[disneysteve]

Thank you, Steve. I will think long and hard before venting here again as it gives some people an opportunity to beat you down while you're already low.

Nah. Go ahead and vent. Take from the replies what is applicable and do your best to ignore the ones that aren't. As I said, we rarely see the big picture so it's easy to focus on the one piece of info we're given and make assumptions that may or may not be true. Would I put a highly speculative stock in my kid's college account when they're in high school (or even earlier than that)? Nope. But that doesn't make it wrong depending on the big picture. As long as you understand the risk you are taking and you have a back up plan if that doesn't work out, go right ahead.

[Scallywag]

Nah. Go ahead and vent. Take from the replies what is applicable and do your best to ignore the ones that aren't. As I said, we rarely see the big picture so it's easy to focus on the one piece of info we're given and make assumptions that may or may not be true. Would I put a highly speculative stock in my kid's college account when they're in high school (or even earlier than that)? Nope. But that doesn't make it wrong depending on the big picture. As long as you understand the risk you are taking and you have a back up plan if that doesn't work out, go right ahead.

This is the 2nd time this has happened. The first time, I was called out for allegedly CHOOSING to live in a HICOL area in another thread. Maybe just maybe we moderate incomes & service providers should all move out and let rich punks fend for themselves? Then you'd be a little less exclusive & judgmental about who can habitate in your exclusive neighborhoods when you realize how it affects your high income butts if we all moved out?

NO, NOT ALL IN STOCK FUNDS! As I said community college is nearly free and 529 should cover UG. She intends to work after UG and things may have come back by the time she decides to go to graduate school. We'll cross that bridge when we come to it.

[Like2Plan]

Folks, keep in mind that everyone's situation is different and we only see a little slice of it when a question or comment comes up. We don't know the big picture. Something that looks super risky might make perfect sense in the overall plan. And everyone's risk tolerance is different. While I might choose to be conservative in my kid's college fund when they are in high school, someone else might be comfortable being much more aggressive because they have a good back up plan if things go south. So let's try to be a little less judgemental (which I freely admit I've been guilty of myself more than once).

I guess I am confused. No one likes to see losses. But, Scallywag, you did ask if anyone would have a different input if you added that you have other stocks plus the 3 fund portfolio. I'm not sure what the goal was for asking this question. You still have a short term need for the money. It goes against the advice that is commonly given for someone who has a short term goal (child going to college soon).

And, I gave a real life illustration on how that might not have worked out so well. I would put this in the same category as someone who asks where should they invest their money for a down payment on a house that they expect to purchase within the next few years. If you might possibly need to tap into this money source, you don't want it to just go "poof".

I am assuming the TSLA position is a small part of the portfolio, but I'm looking back at TSLA since Thanksgiving-- and it has gone up from $70/sh (adjusted for the split) to closing at $372/sh. There was a run up on the price prior to the split and then it drifted down--which I think is pretty normal whenever a stock splits. (Although--is anything normal with a stock like TSLA?) It looks like anything purchased prior to mid Aug-ish is still higher than the purchase price--so an overall gain. https://finance.yahoo.com/quote/TSLA/history/

No one knows what is going to happen next with the market. Are we on the brink of an abyss for a contraction in the economy? I don't know that is why I am staying in the market. But, actually I would be more surprised if there wasn't a downturn in the economy at some point in the future. You have to examine how this will impact your plan.

This is not being judgemental. This is not being emotional. You may end up have spectacular results, but I think you might lose a lot of stomach lining over your journey. I thought you might be looking for another path.

In one day... POOF. This hurts. I know this is just a blip in the road and we're vested for the long term but I still cannot help feeling down / depressed over this crash.

How's everyone else - esp $TSLA holders - doing?

I DCA-ed in since Thanksgiving, so technically, I'm still in the green. The "loss" looks amplified as I gained a few hundred shares from the split and so the loss was multiplied by several thousands as well.

A large portion was in DD's Coverdell account and that is why I am so pissed. She's in high school and intends to go to community college first. I really want her to graduate debt free. Additionally, the plan was that anything left over after her graduation would be rolled over into her brother's ABLE account. I always get emotional when anything affects my son, and teared up to see a HUGE MONSTROUS RED NUMBER next to that account.

I think most of us are ok taking a hit to ourselves, but it just feels like someone punched the oxygen out of me when it happens to my kids.

Well, that account isn't only for my daughter's Coverdell. As I said, the reason I am slightly hesitant to sell it all is because it DOES have a long term component to it in that if we didn't cash it out to pay for her tuition then it can be rolled over into an ABLE account eventually and the time-frame for that account is at least 40 years! Also, DD has a 529 which is conservative, I kept stocks in the Coverdell for the market exposure.

To be honest, I am one of those people who IS quite aggressive, because, this is all money for my son who may need it in 40 years' time. That long time duration is what makes me hesitate about pulling the trigger so fast. Also, the account isn't just TSLA. It also has a couple of other stocks (MSFT and JNJ) with the rest vannila 3-fund Boglehead portfolio. Not sure if that makes you guys have different input for me?

Yeah, I teared up, because WHO likes to see huge red numbers next to their kids' accounts? BUT I've since calmed down because again my horizon is not just the 4 years to Junior Year at University but much further out to 40 years for DS (unless something REALLY drastic happens and we lose everything)

[LivingAlmostLarge]

I guess I am confused. No one likes to see losses. But, Scallywag, you did ask if anyone would have a different input if you added that you have other stocks plus the 3 fund portfolio. I'm not sure what the goal was for asking this question. You still have a short term need for the money. It goes against the advice that is commonly given for someone who has a short term goal (child going to college soon).

And, I gave a real life illustration on how that might not have worked out so well. I would put this in the same category as someone who asks where should they invest their money for a down payment on a house that they expect to purchase within the next few years. If you might possibly need to tap into this money source, you don't want it to just go "poof".

I am assuming the TSLA position is a small part of the portfolio, but I'm looking back at TSLA since Thanksgiving-- and it has gone up from $70/sh (adjusted for the split) to closing at $372/sh. There was a run up on the price prior to the split and then it drifted down--which I think is pretty normal whenever a stock splits. (Although--is anything normal with a stock like TSLA?) It looks like anything purchased prior to mid Aug-ish is still higher than the purchase price--so an overall gain. https://finance.yahoo.com/quote/TSLA/history/

No one knows what is going to happen next with the market. Are we on the brink of an abyss for a contraction in the economy? I don't know that is why I am staying in the market. But, actually I would be more surprised if there wasn't a downturn in the economy at some point in the future. You have to examine how this will impact your plan.

This is not being judgemental. This is not being emotional. You may end up have spectacular results, but I think you might lose a lot of stomach lining over your journey. I thought you might be looking for another path.

This above. I feel bad for scallywag. Asking for a suggestion. I think the one saying post details of the portfolio is valid. It's possible we might say don't sell hang on. I mean it's a legitimate idea. I made the suggestion that she invest in able and live with it. Also a valid suggestion. I also know the able account is only valid below $100k or else it impacts medicaid. So how much is in there probably matters as well. And maybe making suggestions based on how much is in there and how much they plan on contributing.

[Jluke]

TSLA up 46.90 today.

I made back $469

it’s going to be a rollercoaster ride.

hang on

limit orders are your friend too for buying/selling.

patience was my enemy

[james.hendrickson]

TSLA up 46.90 today.

I made back $469

it’s going to be a rollercoaster ride.

hang on

limit orders are your friend too for buying/selling.

patience was my enemy

Any thoughts on why the S and P wouldn't include Tesla?

[LivingAlmostLarge]

Any thoughts on why the S and P wouldn't include Tesla?

overvalued. their profits are based on selling credits to other car companies. That doesn't mean I don't agree with Singuy they are leading battery innovation. I'm waiting for battery day and long on tesla. But at the same time I would not be comfortably putting my kid's money into TSLA.

Actually Scallywag my kids own nothing risky just VOO and QQQ. That's it. I take all the risk in my investments. You should do that. That way you can have it tank and be okay. But then your kids are fine and you can always provide support for them from your own funds that you've risked. That's the way I look at it. I have saved $X for the kids in 529, ESA, and Taxable. But I will literally cry if it goes away and college we have to pay. We might still have to pay, but at least I know that we did our best and were "conservative".

But for our own accounts we can withstand hits of 20%. DH will just work another year. He'll just keep working until I say really you don't have to. So a big hit to our portfolio is the not the end of the world. And knowing that I can sleep. I can sleep knowing I"m not gambling my kids future but only my own.