investing advice

Financial Planning - Financial planning in general. (Moderated) 

  Yahoo!   Google   Windows Live   del.icio.us   digg   Netscape

Subject Author Date investing advice Joe 02-24-2007  Re: investing advice Elle 02-24-2007  Re: investing advice John A. Weeks I... 02-24-2007  Re: investing advice Elle 02-24-2007  Re: investing advice Elle 02-24-2007  Re: investing advice kastnna 02-25-2007  Re: investing advice Elle 02-25-2007  Re: investing advice joetaxpayer 02-24-2007  Re: investing advice John A. Weeks I... 02-24-2007  Re: investing advice joetaxpayer 02-24-2007  Re: investing advice jIM 02-24-2007  Re: investing advice PeterL 02-25-2007  Re: investing advice Shhhh 02-25-2007
Posted by Joe on February 24, 2007, 4:43 am I have exactly 29k saved in a high yield savings account. Currently, I earn about 32k a year, I contribute 6% to my 401k and my company matches 6%. I also have a roth IRA with Fidelity that I contribute 200 dollars a month. I am 27 yrs old. I would like to move some money out of my savings account and into mutual funds with either fidelity or vanguard. Can someone recommend some funds or a portofolio mix. I am looking for something that is moderately aggressive. Posted by Elle on February 24, 2007, 8:45 am Bear in mind the conventional wisdom is to have about six months to a year or so of living expenses in a money market fund or similar, for emergencies. What's left may be invested for retirement, a downpayment on a house, whatever. Try the free online asset allocation tools at http://home.earthlink.net/~elle_navorski/id8.html to get some ideas about allocation. They generally consider one's age and risk tolerance in identifying a recommended allocation of stocks, bonds, and cash. Posted by John A. Weeks III on February 24, 2007, 9:12 am > Bear in mind the conventional wisdom is to have about six > months to a year or so of living expenses in a money market > fund or similar, for emergencies. What's left may be > invested for retirement, a downpayment on a house, whatever. This is an example of why "conventional wisdom" is often such a bad idea. Having 6 months worth of living expenses stuck in a poor performing investment is financial stupidity. Life is short, and money only has value over time. Once you lose this time, the value is gone for good. A far better idea is to invest this money, put it to its highest and best use, and come up with an alternative to meet those occasional emergencies. Having a credit card, home equity line of credit, and checking account with overdraft protection are great tools for such occasions. They are all relatively inexpensive, charge only when used, and can be paid back over time or by tapping into your investments at a convenient time. -john- -- ====================================================================== John A. Weeks III 952-432-2708 john@johnweeks.com Newave Communications http://www.johnweeks.com ====================================================================== Posted by Elle on February 24, 2007, 9:32 am > >> Bear in mind the conventional wisdom is to have about six >> months to a year or so of living expenses in a money >> market >> fund or similar, for emergencies. What's left may be >> invested for retirement, a downpayment on a house, >> whatever. > > This is an example of why "conventional wisdom" is often > such > a bad idea. Having 6 months worth of living expenses > stuck > in a poor performing investment is financial stupidity. > Life > is short, and money only has value over time. Once you > lose > this time, the value is gone for good. A far better idea > is > to invest this money, put it to its highest and best use, > and > come up with an alternative to meet those occasional > emergencies. > Having a credit card, home equity line of credit, and > checking > account with overdraft protection are great tools for such > occasions. I think what you list are horrible tools, because (1) the interest rates are ridiculous; and (2) current money market rates at reputable institutions are about 5%. > They are all relatively inexpensive, charge only > when used, and can be paid back over time or by tapping > into > your investments at a convenient time. If there is a market downturn, this "convenient" time may not be for years, during which time one racks up a hefty credit card interest bill. There are a lot of ways to finagle one's finances so this "emergency fund" is always there as a buffer, yet is doing more than just sitting there. I don't have a strong objection to using one's contributions to a Roth IRA as at least part of an emergency fund, either, since contributions may be withdrawn penalty-free at any time. Otherwise, we disagree, strongly. And don't go calling people's comments "stupid." That's not constructive, duh. Posted by Elle on February 24, 2007, 6:40 pm > >> I think what you list are horrible tools, because (1) the >> interest rates are ridiculous; and (2) current money >> market >> rates at reputable institutions are about 5%. > > Perhaps your credit rating isn't what it should be. My credit rating is undoubtedly better than yours. Address your remarks to the general population, who, if you've done any reading on this at all, are frequently paying interest through the nose to credit card companies. > I get > offers in the mail on a daily basis for 1.99%, 2.99%, and > 5.99%, some for 6 to 9 months, others for the life of the > loan. These are on cards that I already hold, and where I > have credit available. > > At the same time, the Dow and S&P are both up around 15% > over the past year. Are you serious? Do you remember when it was down 15% for the year? I reassert that keeping money sitting > in a low return bucket You're also forgetting that part of many allocation strategies is to have a certain amount in cash. This can be massaged to make up one's emergency fund as well. We disagree. Plus, you need to watch your ad hominems. Similar Threads Posted Investing advice March 30, 2007, 4:12 pm Advice on investing and tax savings January 3, 2007, 8:10 am Investing Better September 12, 2007, 3:44 pm beggining investing January 15, 2007, 7:18 pm investing in Yuan? March 5, 2007, 4:59 am Investing in Prosper August 13, 2007, 5:07 am payoff mortgage vs investing November 15, 2006, 3:18 pm Question about re-investing returns... November 26, 2006, 5:35 pm Investing with Private Banks December 15, 2006, 4:59 am Regular or taxexempt investing? March 30, 2007, 4:12 pm