15 votes

Reddit has become the gospel of personal finance

8 comments

  1. [5]
    envy
    Link
    There are a number of incredibly knowledgeable people in the finance domain who used to drop interesting papers for discussion. They have almost all left the investing and finance communities of...

    There are a number of incredibly knowledgeable people in the finance domain who used to drop interesting papers for discussion. They have almost all left the investing and finance communities of Reddit.

    Now we have a lot of very young folk getting simplistic advice from overly confident amateurs.

    It's appealing if you are young, because the advice is easy to consume, and paints everything in stark black and white terms.

    The folks in UHNW, HFT, MM, Quants, Traders & Analysts got a lot of hate for correcting misconceptions, so they simply don't participate any more, except for a few who are now embittered moderators of various subreddits.

    If you know the basics, there are no more gold nuggets to find.

    I did not learn about the impact of large capital gains on AMT, the Mega Backdoor Roth IRAs, or anything else from Reddit.

    I drilled into the linked Mega Backdoor Roth IRA reddit article to see if I missed something, and it does not mention the mega backdoor even once.

    13 votes
    1. [3]
      whisper
      Link Parent
      Where have they all gone? What is a Mega Backdoor Roth IRA?

      Where have they all gone?

      What is a Mega Backdoor Roth IRA?

      3 votes
      1. Litmus2336
        Link Parent
        Max out your 401k after tax contributions, then perform a slightly complicated in-service rollover, and magically end up with Roth contributions. Basically a way for rich people who cannot...

        What is a Mega Backdoor Roth IRA?

        Max out your 401k after tax contributions, then perform a slightly complicated in-service rollover, and magically end up with Roth contributions. Basically a way for rich people who cannot contribute to a Roth account above the 19.5k limit in their 401k to contribute to up to like 55k, and withdraw it tax free.

        4 votes
      2. envy
        Link Parent
        Most are active in non financial subreddits.

        Where have they all gone?

        Most are active in non financial subreddits.

        1 vote
    2. Wes
      Link Parent
      For what it's worth, I learned this tip from reddit's finance subs. Though now that you mention it I haven't seen it discussed in a few years.

      the Mega Backdoor Roth IRAs

      For what it's worth, I learned this tip from reddit's finance subs. Though now that you mention it I haven't seen it discussed in a few years.

      1 vote
  2. Ember
    Link
    Huh. Now that I think about it, most of my personal finance reading happens on /r/personalfinance... it's just so much more authentic to read stories from various people, instead of a step-by-step...

    Huh. Now that I think about it, most of my personal finance reading happens on /r/personalfinance... it's just so much more authentic to read stories from various people, instead of a step-by-step book. Hearing the voices from both people who've lost it all as well as those that just inherited huge sums or got a big raise is kinda educational about the day-to-day life of others. Probably not the most accurate advice, but it's a neat aggregator of experiences.

    7 votes
  3. [2]
    Nhiryn
    Link
    Where instead should one go for financial advice if Reddit is untrustworthy?

    Where instead should one go for financial advice if Reddit is untrustworthy?

    3 votes
    1. Durallet
      Link Parent
      Bogleheads is an excellent resource if one wants to learn about personal finance: Bogleheads Book Recommendations Bogleheads Wiki: Getting Started For actual financial advice from a licensed...

      Bogleheads is an excellent resource if one wants to learn about personal finance:

      For actual financial advice from a licensed professional, one should look for a fee-only financial planner. Garrett Planning Network is one resource for that.

      3 votes