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Unormal posted:investing vs. speculation this sunday sunday sundaaaay While I agree with everything above, there's only so far that advice can take a thread. In fact, it's covered in the OP: quote:1) Contribute to 401(k) up to employer match I've got those rules set, and I've also worked out what kind of risk I'm comfortable with and how much I intend to continue to contribute as well as when I plan to retire. So now that the basics are out of the way, I'm just trying to expand on the section below that labeled: quote:I have all these different funds to choose from, where do I start? Moreover, while speculation is a purely stock-based profession, given the inherent distribution of assets in mutual funds for the purposes of lowering risk, speculation in that category becomes a hell of a lot less of an all-encompassing timesink for profit. All I'm asking is in what funds people have been happy with, so that we can all collectively see what's getting hosed versus what isn't in our current bear market situation. I would think NOW, more than other time, would be the crucial one to do this, given that our current market has a lot more potential up than down, god willing.
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Aug 14, 2008 13:00
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SDMX posted:While I agree with everything above, there's only so far that advice can take a thread. In fact, it's covered in the OP: Speculation is not a purely stock based profession. Speculation includes anything you can buy and sell for profit. The basis of long term investing is basically that you don't know what is going to outperform, and things are more or less efficently priced. Our market has about the same potential up and down, in anything but a very long (15+ years) term. In any case, to answer your question, my two primary holdings are: VTSMX - Vanguard Total Stock Market Index VFWIX - Vanguard FTSE All-World ex-US Index They are very nice, low cost, tax-efficent, diversified equity funds. Tax-efficency wouldn't matter as much to you in a tax deffered account, but they are perfectly good holdings even there.
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Aug 14, 2008 15:40
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I think this is a thread worthy of bumping... I'm throwing around ideas for another long term investment. As I mentioned before, I've got about 12k in VTSMX as a Roth IRA. I was doing some reading at fool.com and they have some really good things to say about Vanguard's S&P 500 Index, so I thought about that, but then they have this article on their frontpage, so I'm not really sure... This money shouldn't be needed for about 30 years, so I don't mind going aggressive, something like VGTSX, Vanguard's International Stock Index Fun, with more exposure to emerging markets. edit: oh I also threw 1k into an etrade account, but that's not for anything long term. I'm not real knowledgeable about what I'm doing there, just sort of using it for fun. Febtober fucked around with this message at 03:28 on Aug 25, 2008 |
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Aug 25, 2008 03:23
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Febtober posted:I think this is a thread worthy of bumping... If you're already invested in VTSMX, continue to invest there. First of all, this index is weighted 80% to the S&P 500 as it stands, you wouldn't be getting any more diversification by weighting your assets more into large caps. The total stock market tends to slightly outperform the S&P 500 over long stretches due to the added risk of mid and small cap stocks...however the weighting is slight enough that the total risk of the fund isn't huge. Just keep on contributing to your total stock market fund. For more diversity, contribute to VGTSX in some percentage depending on age, and I would also take some bond holdings...the easiest way being Vanguard's Total Bond Market Fund. Even if you're not risk averse at all, it's good to have at least a 10-15% stake in bonds, it will slightly minimize risk without taking a large hit to your reward with such a low percentage holding.
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Aug 25, 2008 16:24
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When you guys say max out the 401k, does that mean that I have to contribute a max of $15,500, or does my employers match count towards the same maximum?
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Aug 25, 2008 19:10
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FateFree posted:When you guys say max out the 401k, does that mean that I have to contribute a max of $15,500, or does my employers match count towards the same maximum? $15,500 is the max that you yourself can contribute -- whatever employer match you get is separate from that amount.
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Aug 25, 2008 21:06
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Don Wrigley posted:For more diversity, contribute to VGTSX in some percentage depending on age I'm 24. I think I'll go ahead and throw the $3,000 minimum into VGTSX. It's current price is pretty much its 52 week low, so I guess I guess I've got the "buy low" part down.
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Aug 26, 2008 03:11
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What should I do with a CMA with 300 shares of Exxon? I'm 23, have no debt, and know nothing about stocks/bonds/mutual funds etc. I was thinking of setting up an IRA. I already take out $500 from every pay check to put in savings, and I'm not sure why I haven't set one up for that already. Just looking for some suggestions on options I should look into...
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Aug 29, 2008 05:30
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This is a question about a New Zealand savings fund, but it deals with overseas investment and fees. NZ has a government scheme called Kiwisaver, a brief rundown is as follows: * a $1,000 tax-free kick-start * a member tax credit of up to $1,042.86 per year * subsidised scheme fees, ($40 a year) and * a compulsory contribution from your employer. (4%) I'm considering going with the scheme that's run by my bank, ASB, and they have a number of options available, ranging from conservative to craps. Being 24 I'm looking to go the high-risk route (at least until I start hitting 50). As I was looking, I noticed they offered a 'Global Sustainability Fund', which looks like it follows Al Gores Generation Investment Management. Being a bleeding heart liberal who impotently shakes my fist at the military-industrial complex, this seems an attractive option. However, check out these comparison pages: http://www.asb.co.nz/kiwisaver/ASBScheme/compare-funds.html <-Basic schemes http://www.asb.co.nz/kiwisaver/firstChoiceScheme/compare-funds.html <- Active/Index schemes, including the sustainable one. The investment management fee for the GSF is 1.5%, just about 5 times higher than the others... so, 1) Is Generation Investment Fund a worthwhile, reasonably competitive and competent group, or just a gimmick? 2) Should I baulk at those fees and go with one of the cheaper options? I get $40 a year from the government to help pay those fees off.
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Sep 4, 2008 11:21
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AssumptionBulltron fucked around with this message at 10:46 on Sep 25, 2013 |
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Sep 4, 2008 13:18
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Investing it a low-fee index during a low period of the market is certainly a good idea, but it's a little strange to go for something like buying on margin. What exactly is drawing you in that direction?
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Sep 6, 2008 22:29
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Some of you long term investing people might be interested by this: http://www.billakanodoodahs.com/2008/08/five-great-investment-papers/
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Sep 6, 2008 22:36
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What's a good discount broker to start an IRA at? The OP has a link, which has a link with a rundown of different brokers, but it all kind of went over my head.
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Sep 7, 2008 01:13
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enraged_camel posted:What's a good discount broker to start an IRA at? I'd suggest Vanguard.
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Sep 7, 2008 01:26
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enraged_camel posted:What's a good discount broker to start an IRA at? schwab
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Sep 7, 2008 01:40
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AssumptionBulltron fucked around with this message at 10:46 on Sep 25, 2013 |
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Sep 7, 2008 09:46
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I've always been a little confused about this - when people say put away 10% of your pre-tax salary, do they mean 10% PLUS company match, or 10% WITH company match. For example, my company does a 4% match if I invest 4%. I bumped this up to 6%, so technically 10% of my pre-tax salary is being invested. But should it be 10% plus the 4% company match going into my 401(k)?
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Sep 7, 2008 20:06
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Daylen Drazzi posted:I've always been a little confused about this - when people say put away 10% of your pre-tax salary, do they mean 10% PLUS company match, or 10% WITH company match. For example, my company does a 4% match if I invest 4%. I bumped this up to 6%, so technically 10% of my pre-tax salary is being invested. But should it be 10% plus the 4% company match going into my 401(k)? It's more of a rough rule of thumb. There's a lot of retirement calculators out there, figure out when you want to retire and with how much (or what level of income you'll need your retirement savings to provide) and they'll be able to tell you how much you'll need to save per month. quote:I was thinking that buying on margin might be profitable in the long run, especially as I was told that the interest on the loan is tax deductable. Is it a bad idea? Maybe, I don't know. Buying on margin isn't something you want to do unless you kno exactly what you're doign and why.
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Sep 7, 2008 21:10
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So. Schwab or Vanguard for a Roth IRA?
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Sep 8, 2008 00:02
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enraged_camel posted:So. Schwab so you will have a broader choice of funds than just the Vanguard family (though they are available through Schwab if you wish).
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Sep 8, 2008 00:45
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enraged_camel posted:So. A lot of people like Vanguard because of low fees. All their funds have a $3,000 minimum except for their STAR fund, however. I'd decide on what you want to invest in and then choose a company. Both companies should have the common index funds, so you should be able to build a similar portfolio in either.
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Sep 8, 2008 01:03
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var1ety posted:A lot of people like Vanguard because of low fees. When your post-tax, post-inflation real return is 2-3%, the difference between an average ER of 0.2% and 1% or even 0.5% or god forbid 2% is HUGE. Just keep this in mind.
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Sep 8, 2008 02:47
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NZAmoeba posted:This is a question about a New Zealand savings fund, but it deals with overseas investment and fees. Bumping to see if there are any answers to this, otherwise I'll probably sign up in a couple days and see how it goes after a year, transferring doesn't appear to be much of an issue.
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Sep 13, 2008 13:46
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Unormal posted:When your post-tax, post-inflation real return is 2-3%, the difference between an average ER of 0.2% and 1% or even 0.5% or god forbid 2% is HUGE. Just keep this in mind. I have no idea what this means. What does it mean?
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Sep 14, 2008 06:18
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enraged_camel posted:I have no idea what this means. Expense ratios that look so small you want to ignore them (1.5%) are, in fact, gigantic, because let's say your total real returns after taxes and inflation are something like 5%. 1.5% is a huge chunk of 5%, so even though 1.2 looks a lot like 0.2, There's a whole world of difference between a 0.2 and a 1.2 expense ratio in terms of your final results. To attempt to stop speaking in gobbldeygook: Imagine you could choose between two pretty similar broad-based funds, one with a 0.5% ER and one with a 1.5% ER. If you invested $10k in each and each returned the same 10%, after 30 years of compounding you have: 0.5% ER = $150,132 1.5% ER = $110,884 So by reducing your ER by 1% you saved 40k in final value (about 25% of the .5ER fund's value at the end). Teeny tiny slivers of ER can mount up to huge amounts of money over time (for you or the fund managers, it's totally your choice)
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Sep 14, 2008 08:25
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Unormal posted:Expense ratios that look so small you want to ignore them (1.5%) are, in fact, gigantic, because let's say your total real returns after taxes and inflation are something like 5%. 1.5% is a huge chunk of 5%, so even though 1.2 looks a lot like 0.2, There's a whole world of difference between a 0.2 and a 1.2 expense ratio in terms of your final results. I see. So what does that translate to in the context of trying to choose between Vanguard and Schwab for a Roth IRA? Your initial response was to the statement "a lot of people like Vanguard because of low fees", so were you agreeing with it?
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Sep 14, 2008 17:45
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enraged_camel posted:I see. I personally use Vanguard, for one because it's so inexpensive. ETFs allow you to build a very inexpensive portfolio regardless of brokerage, these days, so it's not the hugest deal. I don't think you can go wrong choosing a low cost brokerage like Vanguard or Fidelity though.
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Sep 15, 2008 00:55
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I have a question regarding my new retirement account, and since I'm not very competent in financial matters, I couldn't get a clear answer from the OP. I'm 25 and just started a new job. This job will only last 1 year. I am required to put about 6% of my monthly income into a TIAA-CREF account. There were several different TIAA-CREF account options, ranging from high ratio of % equities/non-equities to low ratio. From what I understood, a high ratio of equities to non-equities is ideal for long-term investments, and since I'm only 25, that would seem to make the most sense. The plans were simplified to being classified as to what year you would be retiring, so I went with the highest ratio of equities to non-equities. However, after I stop working at this job in a year, I plan on closing the account and taking the money out, as I will need it for various things (I'm getting married, moving back to New England). However, with the way the market is right now, I'm thinking a portfolio that is only meant to last 1 year should not rely so heavily of equities right now. Am I correct in thinking that? Therefore, I have been considering switching my TIAA-CREF account type to the one in which the ratio of equities to non-equities is the lowest, so that the money I'm putting into this retirement account (and is being matched by my employer) does not fluctuate, because I feel that the risk of it fluctuating downwards far outweighs any short-term gains I may have gotten if the market weren't so shaky right now. Let me say that I know fully well I should just keep this money in a retirement account and not touch it, but unfortunately I don't have any savings and I won't be able to save much in one year to cover the expenses relating to a wedding and moving from Arkansas to Massachusetts. Any left-over money will go right back into an investment portfolio. I also realize that there are early withdrawal penalties involved. I would just like to know if switching from a retirement account with high % equities / low % non-equities to high % non-equities / low % equities would be in my best interest with the way the economy is right now if I plan on closing this account in one year.
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Sep 15, 2008 19:49
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Idiodyssey posted:I have a question regarding my new retirement account, and since I'm not very competent in financial matters, I couldn't get a clear answer from the OP. If you need the money in a year or less, it dosen't matter if the market is good or bad, it should have 0% exposure to equities. Even in a great long term bull market you can have downturns that last years. You should be in as close to cash as you can be, which means as short-term a set of bonds as you can arrange; or a money market fund if you have it available.
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Sep 15, 2008 20:10
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"[panic posted:"] Can we get into some detail on this? Right now, I think I am sitting pretty so far as my financials go for a 24-year-old. I'm running roughly a $700/mo budget surplus, and am currently investing 20% of my pretax income into Roth IRA/Roth 401(k) which is more than enough to get my company's maximum matching. Specifically, I am looking for some insight as how to balance saving for retirement against saving for some intermediate goal such as going back for a masters/MBA or saving for a house. At the moment, I am not sold on doing either of these, but I can see myself making a decision on them in about five years or so.
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Sep 15, 2008 20:57
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Unormal posted:If you need the money in a year or less, it dosen't matter if the market is good or bad, it should have 0% exposure to equities. I'm not sure I understand the reasoning behind this. As far as I understood it, the percentage of my income directed towards this retirement account is immediately allocated into various funds and exposed to the market. I will try to alter my account so that the majority is in money markets, but I'm not entirely sure yet just how much control I'll have over the distribution without changing the type of the account it is.
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Sep 15, 2008 21:12
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Idiodyssey posted:I'm not sure I understand the reasoning behind this. As far as I understood it, the percentage of my income directed towards this retirement account is immediately allocated into various funds and exposed to the market. Not all funds are invested in equities. You can read their prospectus's here, or just post your list of available funds, and someone here can sort through and tell you what the best ultra-short vehicle likely is for you.
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Sep 15, 2008 21:21
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Idiodyssey posted:I'm not sure I understand the reasoning behind this. As far as I understood it, the percentage of my income directed towards this retirement account is immediately allocated into various funds and exposed to the market. Since you're in TIAA-CREF, it's possible you have access to TIAA-Traditional. Make sure you DON'T put your money in there if you need the money in a year, since there are some restrictions regarding withdrawals. What Unormal says makes sense. Really, you want a money market fund. TIAA-CREF doesn't have too many bond fund choices, so the ones that are available probably have a higher average duration than you would like.
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Sep 15, 2008 21:26
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There's a lot of love for VEIEX - Vanguard Emerging Markets Stock Index Fund in this thread, and I'm thinking of getting into it for part of my Roth to get some international exposure. One thing that stands out though is it has a purchase and redemption fee of 0.25%. With all the (justified) talk about minimizing fees and overhead, what's the deal with that? I haven't noticed it on any of the other Vanguard funds.
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Sep 19, 2008 02:28
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Nosre posted:There's a lot of love for VEIEX - Vanguard Emerging Markets Stock Index Fund in this thread, and I'm thinking of getting into it for part of my Roth to get some international exposure. One thing that stands out though is it has a purchase and redemption fee of 0.25%. With all the (justified) talk about minimizing fees and overhead, what's the deal with that? I haven't noticed it on any of the other Vanguard funds. Vanguard's younger funds often have a purchase fee until they bulk out, it's not 'strictly' a load since it's paid to the fund not as a fee. So if you hold long enough you theoretically make it back as people pay into the fund. You'll also sometimes see redemption fees on younger funds, or tax-managed funds. Often these go away as the fund ages and grows.
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Sep 19, 2008 02:37
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Nosre posted:There's a lot of love for VEIEX - Vanguard Emerging Markets Stock Index Fund in this thread, and I'm thinking of getting into it for part of my Roth to get some international exposure. One thing that stands out though is it has a purchase and redemption fee of 0.25%. With all the (justified) talk about minimizing fees and overhead, what's the deal with that? I haven't noticed it on any of the other Vanguard funds. The purchase fee isn't too bad. It's 25 cents per $100 that you buy, so it cost me $7.50 when I opened it up with the $3k min. Also if you keep the money in the fund for over a year, they don't charge the redemption fee, according the rep I spoke with on the phone.
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Sep 19, 2008 05:13
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enraged_camel posted:I see. I think the only "lovely" thing about Vanguard funds is that they all pretty much require a $3,000 minimum investment, whereas Charles Schwab funds have a $100 minimum. The lower minimums might be beneficial if you find it difficult to save up huge chunks of cash. The Vanguard funds are still "better" though, because of the lower expense ratios.
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Sep 19, 2008 08:21
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Febtober posted:The purchase fee isn't too bad. It's 25 cents per $100 that you buy, so it cost me $7.50 when I opened it up with the $3k min. Also if you keep the money in the fund for over a year, they don't charge the redemption fee, according the rep I spoke with on the phone. I just checked the website and read the prospectus, and it doesn't say anything about the redemption fee being waived if you hold for over a year. I would not trust what the rep said, as there may have been a misunderstanding during the communication. And Unormal is correct. When the fee is paid into the fund, this is absolutely not an issue. It is actually beneficial for those that have higher-than-average holding periods. I consider it an attractive fee structure.
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Sep 19, 2008 21:40
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Thanks for the answers, 80k, Unormal and Febtober. That makes me feel better. I've got another similar "why is Vanguard doing this" question--what's with the 25k minimum to get into Vanguard Energy Fund Investor Shares (VGENX)? It stands out clearly from the 3k minimums most everything non-admiral has. Do you guys know of anything similar energy-focused they offer with lower minimums?
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Sep 21, 2008 02:45
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Thanks for the awesome replies guys. I'll be opening a Roth IRA at Vanguard and go from there. I don't know where, but I'll figure that out eventually. 
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Sep 21, 2008 04:34
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