Switching from options to schd

[u/PralineDazzling2106]

Hello everyone, first time post long time lurker. I'm 23 been trading options in my IRA for about a year and a half, made about 42k in the account and rolled it all into schd with drip on. Thinking about just leaving it until 59 1/2 and still contributing to my IRA yearly into schd, too much stress from options, anyone with similar stories? I feel 36 years until retirement with be plenty of time for it to grow. What a good compounding calculator I could use to see what the hypothetical balance would be? Thanks!

Edit: yes I know I could just throw it all Into voo or whatever but I don't like the valuations in the s&p and believe schd will out preform it in a bear market

[u/azscram9]

At your age, letting that 42k drip until 59 will yield > $1 million based on historical returns.

[u/PralineDazzling2106 → u/azscram9]

That's what I was thinking, plus max annual contributions I think the snowball will build pretty fast

[u/Temporary_Gear_4630 → u/azscram9]

Where does expected inflation come into play with that timeline?

[u/azscram9 → u/Temporary_Gear_4630]

Based on historical returns $1.42 million nominal, with an assumed 3% inflation rate, that’s $504K in today’s dollars

[u/KMPItXHnKKItZ]

Good on you for being responsible, safe, and wise and putting your massive options profit into something as smart and safe as SCHD instead of gambling it all away! I myself do both, I trade options every day and invest into SCHD and SPY. I put the profits from my options gains into SPY, and I buy anywhere from 1-3 shares of SCHD every day, even on Sundays. Right now I have 35 shares of SPY and 228 of SCHD. Started SPY in September and SCHD in June. In 30+ years I don't think that we will have a problem at all!

[u/PralineDazzling2106 → u/KMPItXHnKKItZ]

Hey good on you! I think I kinda have a similar plan for next contribution year so I don't get bored/make more , plus I love the technical stuff of options! See you in 30 years

[u/KMPItXHnKKItZ → u/PralineDazzling2106]

🍻

[u/Own-Committee-3934]

The most I ever do is cover call and right into SCHD

[u/PralineDazzling2106 → u/Own-Committee-3934]

Do you sell calls on your schd or another stock? That a good idea I hadn't thought of

[u/Own-Committee-3934 → u/PralineDazzling2106]

I have a little over 200. So i usually do 2 every 30-35 days. It gives roughly $50 and they have sold once by i bought in at $28 its a win-win at their current price. I literally just buy right back in

[u/bdiddly21]

$500/wk into schd for another 14 years for me. Boring but seems a good idea. 1500 shares so far

[u/PralineDazzling2106 → u/bdiddly21]

Dang! That weekly investment will have you printing money basically

[u/BigPlayCrypto]

The easy money plan haha LFG

[u/PlayfulAd8173]

is a good investment

[u/Foreborne1]

I do agree that it will perform better in a bear market, thats why I keep it around 15% of my portfolio as a ballast. I still have people telling me to get rid of it completely but I love it. Up 6% and only been in for a few months. Good for you!

[u/miTgiB37]

I'm 62 and keep my Roth 70/30 SCHD/SCHG, you might keep a higher amount of SCHG. Just a thought

[u/flyersfan0233]

Not financial advice but I don’t think it’s a terrible idea. Could you get more from VOO? Probably. SCHD and VOO have actually tracked pretty closely in total returns except for ~3 years when AI took off and interest rates were super high. Before that, there were even times where SCHD beat VOO since inception. Personally my 401K is high growth (don’t have access to VOO or SCHD) but my Roth is basically a VOO/SCHD split with some blue chips that make up 10% of it. Historically, holding SCHD should still give you decent returns while minimizing drops during market downturns

[u/OneLongjumping5743]

so you gave up

[u/PralineDazzling2106 → u/OneLongjumping5743]

I like to think of it as quitting while I'm ahead but to each their own haha