posted on August 19, 2001 12:50:18 PM new
Is there anyone here who has a clue and would be willing to help me with investments? I don't know what I am doing. I would like to learn.
T
posted on August 19, 2001 08:03:50 PM new
I just can't resist, so please, be a good sport...
Call Moses, cuz it is said that "Jesus Saves, and Moses Invests..."
Saw that on a bumper sticker a few years back...and I was not even offended
As to your original questions, with the condition of Stocks lately, the "Penny Stocks" are starting to look good
******** Gosh Shosh! My "About Me" Page
posted on August 19, 2001 08:55:05 PM new
#1 advice: never trust a person with your money to invest. No matter how good this person has treated your friends before. No matter this person attends your church, and worships God exactly as you do. People who ask you to trust them with your money turn out to be crooks with very high predictability.
#2. Large financial markets are not rigged nor are you likely to have your money stolen. That doesn't mean that there aren't some outrageously bad investments available, and people on the other side of them ready to sop you up. Generally, avoid things which look like they might make a lot of money in a hurry, because the looks are deceptive.
Avoid:
-Any "over the counter" or "pink sheet" stock.
-very low priced stocks go to zero (and stay there) a hundred times more frequently than they go to $10.
-options, futures, options on futures, ..., stuff advertised on Rush Limbaugh
Generally reasonable:
-GNMA funds
-"spiders", "diamonds", and q's, which are funds which match the S&P500, DJ 30, and Nasdaq 100.
-no load index tracking mutual funds
-tbills, notes, and bonds which can be purchased directly from the federal government or purchased through many banks.
Hard core but for real:
-rental residential real estate. If you can do it, one of the most common paths to being a millionaire in America
In the middle:
-a few individual stocks
-corporate bonds
Risky, but sometimes the way to achieve some intermediate goal:
-lots of stock in one company, usually the company you work for
Not a pure ripoff, but a better deal for them than you:
-load funds (you give them money to put money in, take it out, or both)
-whole life insurance
Wishful thinking which almost never pays off, particularly when compared to the safe alternatives:
-vacation property
-bare land
-antique automobiles, ....
And then:
-timeshare "real estate", no matter where or when. If you're ever tempted, at least check out the resale market where you can nearly always pick these things up, from next to nothing on up to 50% of what the salesman is asking.
-family businesses soliciting your investment. Some work. Most don't. Some investments tie families together. A whole lot of them tear families apart. Declining to invest will not tear apart a good family. Be careful. It might be better to give money to a family member than to invest it with the family member.
-your own business...actually has a much greater chance of success when you invest your own money in it as compared to when you invest someone else's money in it. That doesn't mean the odds are good, particularly when considering people who are just getting into whatever business they are getting in to. Don't bet your family on a wishful thinking business plan.
Well, that's probably a lot more than anyone asked for.
I wasn't paying attention for...umm...ok, 9 years, and I lost money because I had 50% in stock. Help me out. Real estate? v. traditional annuity? Better to keep it split up?
The worst thing you can do is to dump your stocks in such a down market. (If you switch funds, that's essentially what you're doing.) Notice that they're only down for the past year, but up overall. Stocks have an average 10% rate of return -- over time. It's easy to give in to the fear of holding a losing investment during a bear market, but if you hang in there it's likely that things will turn around. Unless you're close to retirement (which I'm pretty sure you're not), holding onto those stock funds should be better in the long run than doing what amounts to "selling low" and making more conservative investments.
My 401(k) has gotten hammered this year, but I'm hanging in there.
As a rule, though, you should have a variety of fund types in your retirement account, with a larger percentage of riskier funds (with more aggressive growth potential -- like stocks) when you're younger, moving to more conservative investments (bonds etc.) as you get closer to retirement and can't afford to wait for any losses to rebound. My 401(k) is full of stock funds -- small cap growth, large cap growth, and international equity. It's painful to watch their value drain away, but I trust that they'll come back within a couple of years.
A really good book to read is The Nine Steps to Financial Freedom by Suze Orman. It's easy to get through and contains lots of great, understandable advice about investing, and also the spiritual side of money. Check on eBay or half.com.
posted on August 20, 2001 01:57:48 PM new"the spiritual side of money....?"
Helen - yeah, it surprised me, too. There's certainly an emotional component to finance, though I've never thought of it as "spiritual." Then again, I'm not a very spiritual person.
Things to the effect of "be generous with your money and financial/emotional rewards will follow."
posted on August 20, 2001 03:32:13 PM new
Thanks Rainy. I though at first you meant managing money according to Biblical principle but I take it that wasn't what it was. I DID already switch it around. When I saw red then it got my attention though I generally always just ignore it. I appreciate your insight which I will consider and continue to learn something about all this. Though I understand basic concepts behind money, stock market, etc., when it gets into this fund/bond/account type by name, I am lost. Part of the trouble is it's boring and time consuming to learn for such a seemingly small amount of money that you can't have for about a hundred years.
I used to play that stockmarket with fake money. Loved it and I always made money. It's an educational tool that is "simulated" based on real stock market and in real time, just like the real thing...but the money is FAKE. Too bad because I would be RICH.
BTW, If anyone wants to put $1000 worth of quarters in and let me play the game, then we can split the winnings 50-50. LOL. Yeah, right...takers on that, just form a line, ok?
And the moral of this story is:
"You can't be rich, if you have no money."
Actually, I would like to get a real estate license.
T
posted on August 20, 2001 03:40:29 PM newI wasn't paying attention for...umm...ok, 9 years, and I lost money because I had 50% in stock. Help me out. Real estate? v. traditional annuity? Better to keep it split up?
Generally, don't take it personally that you lost money. It's not an indication that you were unsuccessful, or that you weren't paying attention. Stock investments have worked well over the long run, not always over any particular short run.
No one can predict the market.
Seriously consider doing nothing.
If you're concerned that we face impending widespread instability, go for the money market fund. A money market fund can sustain almost any kind of turmoil.
"Real estate" isn't obvious as to what it means. It might mean a fund which invests in Real Estate Investment Trusts. Some are ok, some of them are nests of cronies collecting fat management fees. If it's a particular fund with actual properties you can find out about, it might be interesting.
The stock market being down or the stock market being up is zero evidence regarding what it will do in the future.
Bond funds seem scary to me, because I fear inflation. Bonds do well in a period of falling interest rates, and they do dreadfully in times of hyperinflation. Bonds have done very well over the past 15 years because they have carried a premium for inflation risk and the risk has not materialized.
posted on August 20, 2001 03:43:40 PM new
Hey T!
Wish we could've grabbed you before you dumped your stocks, as Beth said.
That being done, now is actually a very good time to buy.
Think of it as A Big Sale. There are certainly a Great many "bargain" stocks right now ~ significantly undervalued and good for long term.
If the real estate in your neighborhood were to drastically come down in price for no apparent reason, wouldn't you scoop up the house next door at 50% off?
Individuals who would never think of selling their home (their largest investment) in a down market think nothing of selling off their investment portfolio when it's value decreases.
The only way you lose money is if you sell it!
A well established mutual fund can be a little easier to stomach for those who get queasy with the roller coaster ride.
Unfortunately, I am limited to what I can actually "recommend" (other than in generalized layman's terms) since I am a licensed investment consultant.
Be careful and know what your goal is (long term growth, etc) before you invest!
Good Luck to you!
val
posted on August 20, 2001 03:53:24 PM newThat being done, now is actually a very good time to buy.
It might be.
But the fact that something is selling for less now than it did six months ago is not evidence that it is a bargain.
Take CMGI, a core "internet" stock. Traded in the high 100s to about $200 a year ago. Then it started down. $100, what a bargain on CMGI? But wait a bit longer, and there it is at $50. Wait some more, damn if it isn't at $10. Wow, what a bargain.
Today it is at $2.
Is that a good buy? I don't think so, but that's just my opinion.
posted on August 20, 2001 04:01:29 PM new
Should the fact that these people are TIAA/CREF reassure me that my money is being invested wisely? I have always assumed that it did...thus ignoring it for 9 years.
T
posted on August 20, 2001 05:54:35 PM new
Have you considered DRIP and direct purchase of stocks ? That's what I do on strictly dividend plays. There are hundreds of companies that you can send money and buy stock direct with little or no fees. Do a search under DIVIDEND REINVESTMENT and there are several sites that list companies that have DRIP and/or direct purchase programs.
With DRIP (dividend reinvestment programs) you can somewhat forget about the stock for years and let it grow if it is a good company.
You can also add as little as $10 a month in some programs, but you don't have to add any money if you don't want to.
I have DRIPS and direct purchase with GE, US Tobacco, Dayton Power and Light Co, American National Bank Shares, Pepsi Co, and several others.
For pure price appreciation ( QQQ's etc. ) I use Trading Direct, $9.95 per trade for internet transactions.
If you don't invest yourself, you just have to pay someone else to do it for you and you start off in the red as soon as you make purchase.
posted on August 20, 2001 06:57:52 PM new
My wife is also in a fund at the University but we take the option to pick what sector
funds we want and sat and talked about it and have done much better than the market.
Even at the very worst when most of the funds took a 30% hit we only lost 5%.
2/3rds in natural gas and the rest in entertainment. Am I saying to go into those? NO.
We will be moving the money to other things as we see changes in the economy and
changes in technology. We both read a LOT about everything from commercial fishing
to building trades practices.
If you depend on a broker to invest for you you are going to run into this syndrome
where they put most of the money in diversified stocks - a formula for mediocrity -
and "safe" blue chips. Then when they go down the tubes they pat each other on the
back and say "Too bad old man - how could you have known?"
Things to invest when you see a leader emerge in the next 10 years...
Tornado and hurricane proof building materials.
Cheap high efficiency LED lighting.
Small scale fuel cell generation of power.
streaming video security systems for upscale homes then cars and personal.
Non ballistic weapons.
Custom built furniture in a few days.
Totally sealed air quality controlled home ventilation sytem. heat/cool/filter and remove pollution.
Blown radiant insulation and radiant barrier paints.
Ballistic panels for home construction.
Cheap bullet proof/rock proof glass and body panels for cars.
High altitude drones replacing cell towers and satellites.
Active response clothing and shoes that are heated/cooled /ventilated.
Self heating and cooling food and drink containers.
Home hand held sensors to detect food spoilage.
Diagnostic sensors that can detect common illness like flu by passing through a gate at a mall entry or airplane tunnel to refuse entry.
Self cleaning toilets with active venting of aerosals.
Diagnostic wear that monitors your heart/ temperature/ blood chemistry and reports emergency conditions to EMS.
Artificial intelligence programs that watch activity at your house and pool and call the police if there is a burglery or a kid in your pool or fire.
Real voice recognition programs that WORK.
Animal stem cells that have human genes inserted for theropies.
Real time electronic translation from language to language with idiom and context.
Airliners than explosivly segment and recover sections with ballistic parachutes when experiencing major failure.
Automobiles that automatically come to a stop on the shoulder and call the police if the driver loses conscienceness.
Packaging that foams an object in place when a tab is pulled.
Sunglasses with a camera on the temple pieces that will flash you a rear view window when you look at the corner.
Programs that continuously compose music on a theme and stream it to you.
The marketing of scenes as a decorator service. For example a view of a drone flying continuously around New York or Yosemite 24/7 for display on a wall. (and law suits to keep scenes the same)
posted on August 21, 2001 10:58:24 AM new
JT, I used Fidelity Retirement Services Company.
When I started out 95% stock, 5% bonds. As my years got near retirement. I started moving it more to Goverment bonds. When I retired, it was 95% government bonds, 5% stock. I retired with 35 years service. It has treated me very well.
posted on August 21, 2001 11:59:16 AM new
Terri - When we were first married a friend of my husband's dad told us to invest our extra money in real estate ownership (direct - not through anyone). Now mind you we were in CA and the market there is *very* different that it is in the south. We followed his advice and it did very well by us.
Then we were given the opportunity to join a profit sharing plan with my husbands employer. That later was converted to a 401K account, where matching funds were added to our account by his company. We put in the max. that they'd match, and then some. We were given the choice as to how much and where we wanted the funds placed. At that time we were told to stay diversified....33% in three different areas. One was high risk, one medium risk and one pretty safe. That worked well for us too. As we got older we did the same thing Fred (Hi Fred) did and started switching our high risk funds to lower risk ones, a little at a time.
I think investing all depends on where your confort level is at any given time in your life.
Wishing you the best with those choices.
Edited to add - About two years before we retired, and with the knowledge that we were going to be in a different life-style situation, my husband took two different 8 week courses at our community college to learn about how we could best handle our holdings in retirement. Maybe your community college offers classes on investing????
[ edited by Linda_K on Aug 21, 2001 12:03 PM ]
posted on August 21, 2001 03:57:51 PM new
Linda_K said, "I think investing all depends on where your confort level is at any given time in your life."
Please take that to heart - many 401k/IRA advisors think everyone of a certain age should invest a certain way.
I'm very conservative when it comes to money (and always have been), and I really believe that unless you have the time to study it, the stock market is a gamble for most middle class folks. Investment types call people like me risk averse.
I'm not saying there isn't money to be made in putting money in stocks, I just think that too many people let "advisors" tell them how to plan for their retirement without knowing what they're really doing. Many of these advisors make a commission no matter what happens to your money, so it's like anything else: buyer beware.
