Retirement/Investment questions

[Maeya]

Recently I've been thinking a lot about trying to start really focusing on smart retirement and investment account moves. I admit I really don't know the first thing about this stuff.

Currently I have a SIMPLE IRA account through my employer (2% contrb from me, 2% match from employee), and a 500 Index fund through The Vanguard Group that my relatives set up for all us kids.

Every month I put in the 2% to the SIMPLE account, but my Vanguard account just sits untouched. Since it's invested in a mutual fund, I get a little bit of interest, and the account value goes up a touch continually, but I'm not currently depositing anything to it (I'm planning to change that, and shoot 2% to it as well).

The 2% for the SIMPLE is not currently invested in anything - it's just sitting in my MMDA. My other options of investment available through Ameritrade are:

-Money Market
-Short Balance
-Stocks
-Short Stocks
-Bonds
-Options
-Short Funds
-Mutual Funds
-Other


I need to be putting my money into something but I haven't the foggiest what the best options for me are.

I'd like to put some into something safe, but I'd also like to try something riskier with higher yields for a portion of it, since I'm pretty young, and can take the losses right now.

Does anyone have any suggestions?

Also, I was wondering, is it wiser to squirrel money away into a number of different accounts (Ameritrade, Vanguard, and I was considering something through Wachovia Securities), or would it be better to consolidate?

Thank you in advance for any advice and thoughts on this

[Menlaan]

Couple of questions:
-- What is your time horizon? Is this truly money for retirement, or might you need the funds for a home / college for kids, etc? When you do you think you might need it?
-- Will your stomache turn if you lose 20% in one year? What about 10%?
-- Do you have any credit card or other debt? If so, what rates do you pay?
-- How stable is your job / career? How about Ugzug's? Can you both count on having a job for the next X years?

[Maeya]

Couple of questions:
-- What is your time horizon? Is this truly money for retirement, or might you need the funds for a home / college for kids, etc? When you do you think you might need it?
-- Will your stomache turn if you lose 20% in one year? What about 10%?
-- Do you have any credit card or other debt? If so, what rates do you pay?
-- How stable is your job / career? How about Ugzug's? Can you both count on having a job for the next X years?

-- Retirement is most important to me right now. Ugz's fund was wiped out in his last divorce, and he's 35, and hasn't started another yet. We need some financial security for our future, so I'd ideally like this to be for retirement. A house is an eventuality, but not for several years, so we haven't really given much thought into financing that (maybe we should). I don't plan on kids right now, so I don't feel the need to save for them. Ugz's daughter will hopefully go to college, but I think the burden of that mostly falls on her mom. I'd like to go back to school, but I need to sort of better my current situation, and get a solid handle on my current money before looking into financing options for school.

-- Well, right now 20% is like, $140, so it's not that big of a deal. So since it's still fairly small, I don't mind losing chunks like that. I'm not much of a risk taker usually, so my personality would push me towards things with smaller losses/smaller gains/less risk... but I realize that in order to really grow the account, I might need to be willing to take those risks. So to answer your question... I wouldn't like it, but it's not the end of the world as long as I have some money in a safe backup account.

--Lease on a car, which is up May 2008. I am unsure if I will do another lease, or actually make a purchase. Credit card debt is minimal - maybe $1,000 right now, but I make $150 payments towards it every month, so unless something unforeseen happens, it will be paid off early 2008. Small reoccurring charges on another card which get paid off in full every month (WOW account, Netflix).

-- Ugzug's is stable. He has a good position at his company, and is a valued employee. Mine is also stable for as long as I wish to remain there, but I'm seriously considering going back to school and changing careers. I don't like my job, and Ugz is pushing for me to find a new one, so a change in jobs is a possibility, but only if I decide to.

[Menlaan]

For now, I would say that you should first and foremost pay off your credit card debt. For your IRA, which you should definitely continue contributing towards as you're getting matching funds from you employer, you should put it into a 'Stocks' investment. Ideally it would be a total stock market index fund with low fees. Note that, in this account, you may very well lose 20% in a year, but you're almost certain to gain significantly by the time you retire.

Once you pay off your credit card debt, stash away a couple of months' expenses in a money market account paying at least 4.5%. (let me know if you need suggestions)

Then, put your money in a Roth IRA. You may have the option to do so with your current employer, but, if not, then Vanguard can probably set you up with one. In that, invest in the Vanguard Total Stock Market Index.

Disclaimer: Note that I am not a financial advisor and this email is for illustrative purposes only. You should consult with a licensed financial advisor and an accountant before taking any specific steps.

[Maeya]

I'd love some money market suggestions

So you think I should put 100% of my IRA into stocks rather than split it up and put some in a money market, and some in stocks?

As far as a Roth IRA, I don't know what that is. Unfortunately, I'm the one to ask at work if we have that option, so my guess is no, since I'm not sure what it is

[Maeya]

PS, thank you for the advice so far, it is very much appreciated.

[Tikker]

do you guys in the states not have investment advisors at the banks?

here I just go to the bank, tell him the goals I want to achieve, then he spits out the options, with past performance of each fund, etc etc

[Diekan]

Recently I've been thinking a lot about trying to start really focusing on smart retirement and investment account moves. I admit I really don't know the first thing about this stuff.

Currently I have a SIMPLE IRA account through my employer (2% contrb from me, 2% match from employee), and a 500 Index fund through The Vanguard Group that my relatives set up for all us kids.

Every month I put in the 2% to the SIMPLE account, but my Vanguard account just sits untouched. Since it's invested in a mutual fund, I get a little bit of interest, and the account value goes up a touch continually, but I'm not currently depositing anything to it (I'm planning to change that, and shoot 2% to it as well).

The 2% for the SIMPLE is not currently invested in anything - it's just sitting in my MMDA. My other options of investment available through Ameritrade are:

-Money Market
-Short Balance
-Stocks
-Short Stocks
-Bonds
-Options
-Short Funds
-Mutual Funds
-Other


I need to be putting my money into something but I haven't the foggiest what the best options for me are.

I'd like to put some into something safe, but I'd also like to try something riskier with higher yields for a portion of it, since I'm pretty young, and can take the losses right now.

Does anyone have any suggestions?

Also, I was wondering, is it wiser to squirrel money away into a number of different accounts (Ameritrade, Vanguard, and I was considering something through Wachovia Securities), or would it be better to consolidate?

Thank you in advance for any advice and thoughts on this

First piece of advice. Don't ask a bunch of message board nerds what to do about your retirement. Call a professional, or go to your bank.

[Maeya]

Just because I "know" you guys through the message boards doesn't mean that you don't have valuable experience to share, or advice to offer. Just like you ask your friends that you know in person for advice, even though there are qualified professionals out there to help you in every situation.

It's Sunday night, I'm sitting at home thinking about this, so I don't see the harm in asking for advice to chew on until I am able to make such an appointment, so I'm at least able to ask semi-educated questions.

[Eziekial]

No harm in soliciting advice from us, what Chad was trying to say was be very careful of taking any "wisdom" from the interwebz and going to the bank That being said, send me a PM if you are truly interested in investment and what your goals are. We can take it from there.

PS. Naked pictures are the best currency....

[Harrison]

Recently I've been thinking a lot about trying to start really focusing on smart retirement and investment account moves. I admit I really don't know the first thing about this stuff.

Currently I have a SIMPLE IRA account through my employer (2% contrb from me, 2% match from employee), and a 500 Index fund through The Vanguard Group that my relatives set up for all us kids.

Every month I put in the 2% to the SIMPLE account, but my Vanguard account just sits untouched. Since it's invested in a mutual fund, I get a little bit of interest, and the account value goes up a touch continually, but I'm not currently depositing anything to it (I'm planning to change that, and shoot 2% to it as well).

The 2% for the SIMPLE is not currently invested in anything - it's just sitting in my MMDA. My other options of investment available through Ameritrade are:

-Money Market
-Short Balance
-Stocks
-Short Stocks
-Bonds
-Options
-Short Funds
-Mutual Funds
-Other


I need to be putting my money into something but I haven't the foggiest what the best options for me are.

I'd like to put some into something safe, but I'd also like to try something riskier with higher yields for a portion of it, since I'm pretty young, and can take the losses right now.

Does anyone have any suggestions?

Also, I was wondering, is it wiser to squirrel money away into a number of different accounts (Ameritrade, Vanguard, and I was considering something through Wachovia Securities), or would it be better to consolidate?

Thank you in advance for any advice and thoughts on this

First piece of advice. Don't ask a bunch of message board nerds what to do about your retirement. Call a professional, or go to your bank.

It could be worse, she could be bitching about the evil-doings of the opposite sex via multi-paragraphed diatribes.

[Menlaan]

Yes, definitely do not invest your IRA in a money market account. After taxes, you're barely (if at all) beating inflation. For a long-term investment account, you're much better off with stocks. You could invest in bonds if you want, but, at your age, I'd go with stocks.

If you can stomache a $500 minimum, then go with http://www.gmacbank.com/. Or, if you are willing to have a bit of a lower interest rate, but no minimums then go with http://www.ingdirect.com/osa_oh/. There may be better options, but these are two that I've personally invested through or have friends who have.

[dammuzis]

http://www.daveramsey.com/etc/cms/index ... entID=4635

is a good place for baby step information

the most important thing to know when you finally start is "never invest in a single companies stock unless your employer has a stock purchase plan"

[Lyion]

do you guys in the states not have investment advisors at the banks?

here I just go to the bank, tell him the goals I want to achieve, then he spits out the options, with past performance of each fund, etc etc

There are people on this board who are really good with investment and it's quicker and easier to check here and online than head to a bank.

[Tikker]

/shrug

the bank I'm at does it with me online all the time

just fire up a WEBEX session, and go thru stuff

it's pretty slick