$3000 X-mas bonus...Silver or Savings?

Zubie · December 5, 2009 6:22AM

Hi guys,
I've learned alot from reading this board over the past year and was wondering if I should take my $3000 X-mas (unused vacation) and put it all in silver bullion. Any other ideas? I'm saving money to buy a house and this money would be used for a down payment in a couple years.

Thanks, Tim

ps...got a good start last month with 50 oz in bars in addition to my 100 oz in ASE proofs/uncs.

Norseman88 · December 5, 2009 6:30AM

It depends if the house is an urgent need then save it for the house, if you can wait awhile for the house then wait to see if Silver pulls back to $15-16 and use half the money to buy Silver while the other half sits in savings for your house.

Weiss · December 5, 2009 6:32AM

Hard to say without knowing a full financial history and your personal risk acceptance/aversion.

If it was me, this is what I would do:

Look for BU rolls of 90% dimes, quarters, or halves. My preference at this point would be half dollars. You should be able to get $110 face with shipping & paypal fees right now, probably better if you've got time to shop around and if the market doesn't spike in the next week.

Then I'd take the other half and put it into high(er) dividend stocks that are depressed right now.

Again, that's me.

Justacommeman · December 5, 2009 6:35AM

Tough question.

Buying silver and holding it for only two years is spectulative in my book. Especially if you will need cash for something else at a defined period.

If silver is @ $12 in 2011 or 2012 will it preclude you from buying your house? Playing with house money is usually a good thing

If you can afford to hold it and you won't sweat it if it goes down then I like your idea. I do believe it's going higher.

All the best.

MJ

renman95 · December 5, 2009 7:25AM

I know where not to put it....climate change related stocks...whatever those are.

JeremyDie1 · December 5, 2009 8:14AM

I would not, because of your circumstance for saving for a house downpayment. If you had money burning in your pocket, than I would say yes. You may want consider though,to buy a little amount of silver over a course of time, if you chose to go that route and do a little cost averaging. If you did this, I would still be conservative and spend a small fraction of that 3 grand.

jmski52 · December 5, 2009 8:37AM

Nobody here will want to tell you to buy silver that is earmarked for a future house purchase because it might go down when you need it most. Who needs that type of guilt?

Here's my perspective. Silver is usually quite volatile. I justify buying it because I think it will be good in the long run. Maybe alot better than just good, maybe even fabulous as an investment.

On the other hand, we have the dollar and many other dollar-denominated assets in which you might invest. They might go up or down, or even stay the same - nobody really knows.

For myself - I don't trust what's going on in the government, the financial markets, the real estate market, the stock market, the commodity markets or the economic data that is being touted at this time. Maybe it's just me. Maybe I'm a paranoid tin foil hat conspiracy nut job. Maybe not.

The loss of integrity is endemic in each of those institutions. I don't know if it will come back, but it will take more than just a few presidential speeches before that changes.

So, before I ramble off the page, I would simply say this - trust your own judgement and take responsibility for your decision. Good Luck.

TrustNo1 · December 5, 2009 9:18AM

savings for house.

rgCoinGuy · December 5, 2009 9:38AM

I think I agree with everyone who has posted before me in this thread.

Konahead · December 5, 2009 9:57AM

Silver

roadrunner · December 5, 2009 10:35AM

If it were me I would not leave it in any dollar denominated assets such as a savings acct or CD, or any other related "safe" place that could potentially see a 30% drop from here in the USDollar. There is no sure thing or a pure safe haven. To me, gold is safer than silver is safer than stocks/dollar. Silver will tend to perform later in the commodity's cycle. We don't know if that's next year or 2-5 yrs from now. Some are forcasting another stock market wipe out and deleveraging event by summer 2010. Gold appears to be following the roadmap from 2005 and 2007 which means a peak in the first quarter or so of 2010. With that mind I like gold bullion as the safest haven since it's the only wealth/currency that isn't someone else's liability. If the choice were easy, we'd all be retired.

roadrunner

Zubie · December 5, 2009 4:14PM

Thanks for all the great advice. Definately several options. Maybe $1000 in savings, $1000 into 90% silver BU Kennedy/Franklin rolls, and another $1000 into silver bars. I have a couple oz of gold, but feel that there is a huge upside to silver. Anyway, thanks so much for the insight guys, Tim

manymortages · December 5, 2009 5:02PM

Min Down payment on a house is only 3.5% for FHA while VA and USDA offer no down. Why wait for a few years when rates and prices are near bottom now???

Geotovore · December 5, 2009 6:06PM

<< <i>I know where not to put it....climate change related stocks...whatever those are. >>

Carbon Funbucks?

57loaded · December 6, 2009 8:25AM

i kinda follow RR comments....gold .....when you say (a couple of years)

YMMV

fishcooker · December 6, 2009 9:25AM

I would leave every bonus and every tax return, etc, in cash/savings to pay down the house. In fact, that's what I did... until the house was paid for (over a decade early).

ChrisRx · December 6, 2009 11:27AM

Buy low sell high

DoubleEagle59 · December 6, 2009 12:05PM

if it's a two year time period you're talking about then absolutely buy SILVER.

it's a no brainer choice for me.

let's talk in two years and see who is right!!

Justacommeman · December 6, 2009 1:49PM

<< <i>Min Down payment on a house is only 3.5% for FHA while VA and USDA offer no down. Why wait for a few years when rates and prices are near bottom now??? >>

Wow, that sounds eerily familiar. At least realtors, banks and mortgage brokers are consistant. MJ

lathmach · December 6, 2009 4:57PM

Well..............
Silver may go up or it may go down.
If you put your house money into silver and silver goes way down, you still get a house.
But it's a single wide, .................in a trailer park.
Used.
And smells of cat piss.
Do you really want to take a chance?

Ray

jmski52 · December 6, 2009 10:56PM

If you put your house money into silver and silver goes way down, you still get a house.
But it's a single wide, .................in a trailer park.
Used.
And smells of cat piss.
Do you really want to take a chance?

In my own case, I'd just go ahead and keep the silver.

guitarwes · December 6, 2009 11:11PM

combine that $3000 bonus with the $8000 first time home buyer's tax credit and get ~ $11,000 down payment on a house. While interest rates are still low and housing prices are low, why not buy now?

Zubie · December 7, 2009 3:25AM

I appreciate all the advice, but, as for buying a house, we are just not in a position to do that right now. We currently have a great deal renting a house and my airline has cut my pay around 30%. The cut should end sometime in 2010, plus our contract raise will increase my payrate 10%. Just need another year to increase my credit score.
Anyway, I'll probably look to invest half of my bonus in silver and bank the other half. With that being said, I was looking at 90% silver Kennedy/Franklin rolls. Would you suggest XF, BU or even proof rolls? Any advantage to paying a little more for proof rolls?

guitarwes · December 7, 2009 3:40AM

BU Franklins/BU Kennedy's usually bring just a spit over what other 90% "junk" silver is bringing if you can find it. IMHO, AU- and down in later date Franklins and '64 Kennedy's are "junk" silver and is usually sold as such. Not much if any numismatic value above melt.

Half silver and half savings is a good move.

Zubie · December 7, 2009 3:54AM

Also wondering since I already have some silver, maybe use the money for palladium pamps?

fc · December 7, 2009 5:26AM

<< <i>combine that $3000 bonus with the $8000 first time home buyer's tax credit and get ~ $11,000 down payment on a house. While interest rates are still low and housing prices are low, why not buy now? >>

to get the tax credit you actually have to buy the house first

best just to save up for the house.. try to get some safe interest on
the money but frankly with these rates... it will not make much of a difference.

manymortages · December 8, 2009 5:04PM

Hey flyboy Goto www.annualcreditreport.com and take a look at your credit report free of charge directly from the credit breaus (not a third party site) If you don't have recent derogatory credit like 90 day lates, collections or judgements then talk to a good lender (someone that has min 10 year experience) and find out what you can get pre-approved for.
Min credit score 600 for FHA 3.5% down and 581 for USDA RD no down. Some states have programs which let first time buyers obtain a special second mtg to be used as the down payment aka tax credit second mtg.
Rates today: 30 year fixed is about 4.75% and 5/1 Arm fha is about 3.5%
About your renting don't count on the landlord to always be your friend. Always have a back up plan.
Good luck.

$3000 X-mas bonus...Silver or Savings?

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