Topic: Investments?

[|BUG| Shamu]

Do any of our members or visitors actively invest in the stock market?

I used to play stocks and found out I was not very good and lost a fair amount of money in individual stocks.

Now I stick solely to Mutual Funds with one exception, the bank where my wife is employed.

Last year was super and this year, especially the last few days have been awesome.

For any of our younger visitors I assure you it is good advice to participate in  investment vehicles available to you such as IRA's or 401 K's.

Don't say you can't afford to save. It is more reasonable to say you can't afford not to save.

I was simply curious if others involve themselves with investment saving, it could be one of the biggest decisions in your life.

[|BUG| K-Man]

The company I work for has a 401 K plan with a 50 % match up to a certain dollar amount (can't remember what it is right now). I'm taking advantage of that, and taking into account my age, investing it heavily in blended risk, and higher risk mutual funds. Hopefully it will pay off in the long run. The thing I am aware of is that I need to do additional saving and investing outside of the 401k because that money is basically locked up for the next 40 years. It will be advantageous to have additional investments not tied to a 401k. I've thought about stocks, or mutual funds, but so far haven't done anything.

Of course I'm also looking at building my house in the next 2 - 3 years, so that figures into where my savings will be spent.

[|BUG| Cobra_9]

Yes, individual stocks can be risky, so what I do have, I put in mutual funds.
I managed a fund for my father-in-law while he was ill, $50,000 went in and 2 years later returned to him $80,000. My wifes IRA quadrupled in 10 years time. It's easy for those who don't have an account to start one. Make use of online resources to help decide what works best for you. My company also has a 401k plan and with a percentage taken from my pay each week, I don't even miss it. If you still want to go with stocks, at least make a safe bet with the Blue Chip stocks. These are the companies that will be around for a very long time.
K-Man, stop thinking about it.........look here,
https://www.fidelity.com/frameless_pr_B.shtml

[|BUG| Shamu]

There are many on line services for stock research and many fund families such as Fidelity, mentioned by Cobra or Vanguard https://flagship.vanguard.com/VGApp/hnw/HomepageOverview that offer valuable data.

Fund families such as Vanguard and Fidelity offer a very broad variety of individual funds in which you may invest. The sites also provide performance data of each fund.

The investment vehicle you choose is often governed by your age or investment philosophy, high risk or low risk. Peronally even though I am 63 years old I am still invested aggressively. I am in a gold fund, MIDSX, a Russian fund, LETRX, a energy fund, VGENX, a real estate fund,CSRSX and a few others. Almost all considered aggressive or high risk, not what an investment counselor would advise.

As for research I uses the funds web sites themselves and also subscribe to Morningstar. My guidelines are, in most cases, to invest in a fund that has a good 5- 10 year history.

I am not smart enough to figure it out for my self so I depend on data. As the old saying goes "In God we trust, all others bring data"

How much to invest?

Right now I invest with my employer the max amount allowed by an IRA, I think it either 14 or 17%. Don't know exact without doing the math.

Historically I haved saved at least 10% of my salary even with kids in college. Did have to tap it a few times like for my daughters wedding and some stock options.

Most advisors will suggest 10% and if your company matches contributions you are just plain stupid if you don't contribute to at least the matching amount.....that's free money.

And yes there are some who don't. Calling them Numbskulls would be coplimentary. And yes I knew one, took me three years to convince him he was stupid. Then he lived with regret for the three years he lost by not contributing.

I also did not start saving wisely until in my 40's but the increase has been significant. If someone starts saving wisely in their twenties it is quite likely by 50 they will have no need to work except for personal satisfaction.

Pay attention to investing and saving, too many working class people do not.

[|BUG| Didit_1]

We use Fidelity Investments for our 401k
Currently, I have 10% of my gross pay invested before taxes.
After that it gets split 3 ways.

Company Stock(NiSource)w/ 10% discount
Fidelity Overseas
Fidelity Growth & Income

I've been very fortunate to have not lost my ass with these.

[PoolMan]

Compound Interest is your friend.  For you youngsters out there, the earlier you invest the better. We have Vanguard at FedEx, and after 14 1/2 years I've seen how compound interest works firsthand.   Good thread Shamu!

[|BUG| LeGres]

Would it be approprite to have a section, probably under private, so we can say what we trade? I know I have been trading for a long time but my change of career about 5 years ago put it all at a stop. I'm looking to start again trading.

Just a thought. This is a great topic and we can help each other whith of course a point on this is my opinion only on all comments. If we could predict the stock market, we would all  be playing MOHAA in Jamaica !!!!! 

[|BUG| Shamu]

While we are all here for fun and games if someone simply learns something about investing / saving from forum dialogue like this it can be a life altering difference.

It's one of my criticisms about our public education system. We try to teach language, math and science but too often real life is left our.

We need more life lessons in school. Compound interest, dividend reinvestment, savings growth are IMHO all things that should be taught at an early age.

This site can provide a little insight to savings:

http://www.finaid.org/calculators/savingsgrowth.phtml

Where I differ with many is that I prefer the market over the bank. Bank interest is safe but low return, barely ahead of inflation. The markets, while they have ups and downs, have historically outperformed savings accounts, CD or otherwise.

Not to be forgotten for the bank savers out there is Internet banking. No Branch offices, low costs and higher interest than brick and mortar banks.

One to look into is:

http://home.ingdirect.com/

Try and beat that percentage in a savings account at your local bank.

However, the bottom line is to SAVE!

And no BS that you can't afford too. IF you are on here with a personal PC, playing games and stuff you cannot use that argument

[MADDOG]

Buy realestate, you cant go wrong.

[|BUG| Shamu]

Buy realestate, you cant go wrong.

And to take the same concept into Mutual Funds look into REIT's or Real Estate Investment Trusts.

Booming year last year.

And to keep this informational:

http://www.investopedia.com/terms/r/reit.asp

For those who want more specific data one of my funds is CSRSX ( Cohen and Stears Real Estate ):

12 Mo. 40.70%;  3 yr. 31.85%;  5 yr 27.60%; 10 yr 16.41%     

[|BUG| Mojo]

Buy realestate, you cant go wrong.

Agreed. .
A piece of property here in north NJ has gone up over 500% since i purchased it 7 years ago.
A piece of land i bought in the Poconos 2 years ago has gone up 70%.  Buy in the right locations, and like Maddog said, cant go wrong.

[MADDOG]

We paid $115,000 for our house.

It is now worth over $300,000

[|BUG| Shamu]

Land and homes have almost always been good as an investment and of course are always tied to location. Buying a home as opposed to renting is almost always a sound financial decision.

Rare is the case where renting is wiser.

However market investing and property or home ownership are two entirely different types of investments or savings. Each effected by many factors in determing overall profit.

Personal real estate often requires a large initial outlay along with the accompanying mortgage. It's nice to say your house doubled in value but it's much more complicated than that.

How much mortgage interest did you pay? Maintenance? Labor? Taxes? All factors that subtract from the overall profit.

And then you only see profit if you sell it. So when do you get rid of you house for the cash? Most likely your kids will see that money after you are 6 ft. under

Market or savings accounts and home or property ownership are entirely different vehicles in which to earn money. IRA's, 401's and such only require a few bucks from each pay check. Real estate generally requires a large outlay.

Each has it's place and neither should be ignored, they go hand in hand.

In my case my primary residence was the necessity, our second home and property are the result of savings. Both have appreciated remarkably well.......but they won't be cash until I'm dead.

Have my property values increased at the percentage rate of my market investments? I am not sure. And yes both homes and property have more than doubled in value. There are just too many factors that need to be calculated for me to make a definitive statement.

The point I hope everyone gets from this is that whatever way you approach your financial future that saving is part of the plan.

[|BUG| Shamu]

Something to think about....

While on the real estate topic keep in mind most financial advisors do not recommend buying a home for cash, even if you had the money to do so.

The old school of thought is to use their money not yours. It is standard business practice to work off of loans and not pay cash. This way your money can still work for you.

Many even advise taking on the largest monthly payment you can afford and the lowest down payment you can make.

The usual recommendation is to mortgage the home and put your other money into other investment vehicles. This allows the property to be in your name as it appreciates, gives you a tax deduction and allows investment of other monies in possibly more profitable vehicles.

If real estate were the best investment why not buy it cash if you could afford to?

Simply because Real Estate may not be the best method of investment. It's good, but needs to work along with other methods of savings.

[|BUG|SoulCollector]

Well since i juist got here i dont have a 401k and all the other stuff.But since i came here with a lot of money i will buy 2 houses one for me and rent the other one.When i pay off the houses in 10 years i will buy 2 more and rent.And hope to start a 401k when i start work.Hope that will help me when im a old guy like Shamu hahahahahahahahaha.And play a lot of golf when im in my 60's