The thing about Nio is that I can HODL until I fully admit defeat (unlikely), or I cling onto it.
With options you need to time the window. You can lose money even if you’re correct but got it at the wrong time. Ain’t nobody got time for that.
easy. buy 15k shares at $3 per. investment is $45K.
immediately sell 25% of the shares at $12 per. return is $45K.
let the rest roll.
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We aren’t public yet, so the sell side of that isn’t easy. There is a risk, which is hard to quantify, that we could go broke or never go public and any shares I buy for $3 go to zero. So there is downside risk.
The upside is buying now when FMV is $12, vs buying later when it could be $50 and I’d have a massive tax bill.
I’m inclined to exercise some options in early January, but not all 15k. I feel like there is way more upside than downside, but I’m not sure I’m willing to bet $45k on that hunch. I might wager $10k though.
Great idea! Will make this my goal going forward for as long as I’m employed.
- Max out 401k
- Continue rolling 10k / month from “high yield” savings to brokerage
- Start contributing to 529 for baby smurf
- Convince mama smurf we don’t need a second vehicle
- Increase charitable giving by $1k
Big / new expenses:
- Daycare
- Home updates (interior painting / fixtures - haven’t done squat since we moved in over a year ago and it’s looks a bit outdated)
- TX vacation / Airbnb for month of January. Decided we want to work remote for 1-2 months per year if our employers will allow to escape Chicago winter
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There’s no way we’d go without a second vehicle. At the height of pandemic we swapped having them on comp-only every few months but leaving one person stranded - in the case of emergencies could still drive as a last resort - or having 0 vehicles if the one dies is not an option.
But we live in the Po, it’s miles to the nearest store of any kind. Maybe big-city-dwellers don’t need it.
Any other takers on the $1k charity challenge???
Holy exchange rate batman
No, not really. Thanks anyway. Bah humbug.
We’re walking distance from downtown / train station in suburbia so hardly ever need 2 cars. The bigger issue is that mamasmurf wants a minivan to haul stuff we can’t fit in the corolla, and I don’t want a gas guzzler as our only vehicle. I also just hate spending money on cars since we don’t drive that much.
Buy them all now, that is what I would do. I would hang on until the shares are traded on the open market
I think I want to run some scenarios around probability of ruin and IPO price to make sure I understand what the expected value is. Honestly, I think that will tell me the rational thing is to buy all 15k now because the upside is very large, and I think the risk of marking my shares zero is pretty small.
But it’s a big wager, $45k to exercise plus income tax on $135k. Of course, if we hold steady even, and IPO at $40, I’m looking at the same $45k to exercise plus taxes on $500k.
Don’t you mean smurfette?
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Ooooh, I need to do a bit more math but it looks like I can probably exercise about 2,000 in 2021 and not get hit with additional taxes under the AMT rules. I think.
So I may exercise 2,000 now, and more but not all in January, and the rest in 2023, to keep my tax bill reasonable.
Based on my ill-founded musings in the Random Thoughts thread, I may be buying more life insurance. Currently have 15 yrs left of a 20 yr term. Will take me to retirement age and beyond.
Should I buy another 10 yr term that will boost my working life payout? Or do something else within a life product? Figuring this out might be my real 2022 goal.
What do you need to provide for if you die today? A spouse, a child, debts that your spouse shares?
I’ve enough life insurance to pay off our house and a bit more because my partner makes less than me and might struggle with our mortgage payments alone. If we were paid off with no kids I wouldn’t bother.
that is the starting point for sure. dependents, outstanding debts, expected required payments (like college), etc. while savings should increase as i age and accounts make gains, i need to replace income and other stuff. maybe rates are lower than expected and I am incented to buy past a horizon I already have in mind.
I could probably use another 40k in my checking account.
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401k limit is up to $20,500 for 2022. HSA limit up to $7,300 (married) or $3,650 (single). Just FYI in case anyone wants to bump up their savings here.
And add another 6500 for the 50+ crowd.
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I’m thinking about getting some life insurance. If and when I kick the bucket, I’d like to see my loved ones get some tax-free cash.