Pull money out of S&P 500 and put into HYSA or keep it in S&P 500?

[brojames]

I put in about $10k in S&P 500 couple years back, which is sitting at about $8.2k right now. I recently opened a high yield account that yields 4.55%.

I put in a total of about 10k within the span of Oct 2021 - Jan 2022. Since then I’ve gotten about $151 in dividends which has been reinvested into S&P 500. No money has been withdrawn at all and its now sitting at $8.2.

Im not in need of the money at the moment. But if it’s going to take many years to regain the value to the initial investment or higher (10k), I figured I might as well be making interest on it which would be about $373 / year.

Should I pull the $8k out of S&P 500 and put it into the high yield account or leave it into S&P500? What are your thoughts?

 

[karavcs]

@brojames What is your time horizon for this money?

 

[isohyeoh]

@brojames The fact that your asking if you should pull money out of the best wealth creating tool on earth, S&P 500, to put it into a savings account means you need to do some additional research. If your not using this money soon then you leave it. If you are using it soon, well it shouldn’t have been invested in the market to begin with.

 

[resjudicata]

@isohyeoh I mean we are about to see a crash as bad, if not worse, than 2008. Could always put it back after shit crashes and build up from there.

 

[kociolek6367]

@resjudicata Giving advice to try and time the market is not going to land well here. And for good reason. Nobody knows what is going to happen for sure. Stay in and keep averaging down if the market starts to crash.

 

[resjudicata]

@kociolek6367 I didn’t give advice. I gave a thought to consider.

 

[kociolek6367]

@resjudicata It's semantics whether it should be called advice or not. But saying that you can always buy back in after it crashes definitely sounds like advice to me. Bad advice because it assumes a crash when there might not be one. Or what if it only goes down 5 or 10%? People waiting for a "crash" will miss out on that buying opportunity. Stay in and keep buying more every month. That is the only way to be sure you won't screw yourself by trying to be the smartest person around.

 

[notcrosskill]

@resjudicata Nice, sell at a loss now and buy back in at all time highs. Buy high, sell low. Sell low, buy high.

 

[thejdawg]

@resjudicata What crash? Since this comment S&P has only gone up a good amount lol

 

[shumeeah]

@brojames We need more information. This reads as though your initial investment has lost value despite the recent performance (last few years) of the S&P 500. Have you been withdrawing money during the period in which it was invested? Or, is this money invested through a very high fee broker?

Either way, market timing is a recipe to reduce long term gains. If nothing has changed for you financially, I would leave good enough alone. If things have changed, a high yield savings or money market might be a better choice.

 

[brojames]

@shumeeah I put in a total of about 10k within the span of Oct 2021 - Jan 2022. Since then I’ve gotten about $151 in dividends which has been reinvested into S&P 500. No money has been withdrawn at all and its now sitting at 8.2k.

I’m not in need of the money at the moment. But I was wondering if it was better to take advantage of the high interests rates at the moment.

 

[nic2018]

@brojames The buy high sell low strategy. Works every time.

 

[rosalinex]

@brojames Where are you getting that 4.55? I might move my emergency fund into it. But to answer your question, if your timeline for needing that money is 1-2 years I would personally move it. If it is longer than that, I would keep it in.

 

[brojames]

@rosalinex It’s Wealthfront. They recently bumped their interest rate to 4.55%.

 

[kavi0808]

@brojames Ha too late! But it was a good idea (I did it)

 

[finian]

@brojames Will you be taking a loss on the S&P?

I am not in favor of market timing, but it seems reasonable to assess when it is a better time for one to sell.