Considering the book I said was arriving Tuesday is the first book on that list, I'd say it's a safe bet that I've already read that. Thanks though.

keep the savings in a money market or savings account for the down payment, i like INGdirect.com

If you are certain that the funds will be used to purchase a home and if you have not already withdrawn from your Home Buyers Plan (HBP), you should consider putting your $10K savings into your RRSP with the view of withdrawing it under the HBP when required. The maximum you can withdraw under the HBP is $25K, so any additional savings could be directed to your RRSP up to this amount as well. You can make that withdrawl with no penalty and pay it back over up to 15 years.

If the HBP is not available to you, or with any additional savings, you should strongly consider putting the next $10K into a Tax Free Savings account (whether you actually invest in something or simply have a cash savings account I'll leave to someone else). At least it will grow tax free in the interim.

Country you live in - Canada
Annual Income - $150K
Amount to Invest - $120K
Risk Tolerance - Low to Very Low
Timeframe for investment - 0 to 2 years
Debt - None
Any other information you might have that would help us - The $120K will be used for a down payment on a new home sometime between two months and two years from now. Most likely between one and two years. I should be able to add approximately $30K per year to this amount. Given the desired use of the funds, both liquidity and capital preservation are most important to me. Ease of investment is also important. The funds are currently in a savings account earning 1%. I have lots of contribution room in my RRSP but have already used the Home Buyers Plan. I have no additional room in my TFSA. Based on what little I know plus skimming the last several hundred posts in this thread I suspect my best other option may be a bond fund but am interested in any advice. Thanks!

FYP

I don't mean to offend, but how do you make 75k @ 24? Damn, is that what 20 somethings can make if you're able to land a job these days?

Country you live in: US
* Income: Well I make $13/hr like 30 hours a week. I have zero expenses right now (I just graduated and my parents are still helping me out until I find out about law school). I have zero debt. But I will be taking out loans for law school. If I go instate (very likely), tuition only costs me around $11000 a year. I will probably work 15 hours a week or something during school.
* Risk Tolerance: Moderate. I am tight with my money, but I am not risk averse.
* Timeframe for investment: Can vary, I'd be willing to try to make quick money or do something steady over 2-3 years.
* Debt: None
* Amount to invest: $3000. This is all the money I have, but I really don't need money (right now) for pretty much anything aside from what I do socially. I just want to use my money to make more money because i'll need it later :O.

Notes: I'm a 23 year old recent graduate trying to get into a cheap law school. I really have no debt or expenses, I don't pay like any bills, no loans, my car is paid off. The help will end soon, but I still won't have to pay for rent while living at home (which will last till the end of July). Probably not car insurance/cell phone either actually, but that could change. I would love to turn this $3000 into something I could live off of while im away at school so I don't have to work too much and not be really poor at the same time. I'll be taking loans out for tuition/rent. I don't know if this is relevant but my county just passed table games which go up in July, and I'll probably make a lot of money playing 1/2. Ideally during July I would like to be working, stacking the terrible locals, and have a decent investment going so I can get myself established monetarily before heading to school. Any advice is great, thank you!

The $120k I of course agree with your determination. Short term money needs to be put at less risk, so a split between straight cash and a Bond fund would be best option. It will be taxable and therefore a short term bond fund like BSV or VCSH or Total Bond like BND. I would consider this money outside of your regular taxable investment portfolio until its use is 100% clear. You may want to consider certificate of deposit to be even more safe. You will limit your upside compared to a bond fund, but it is zero risk when it comes to the preservation of the capital.

With the $30k each year after that I would consider putting it into a more conventional portfolio.

Any suggestions for helping reallocate some of my portfolio?
I feel like I have too much money sitting in money market funds / "high interest" savings

other stats:
age: 29, fairly high risk tolerance
debt: none
income: prefer not to say, but a reasonable mid-career salary where I'm maxing out 401k and roth IRA

% in money market/high interest savings: 41.8%

% in domestic stocks: 40.4%
- 85% of this in small cap value index
- 15% of this in mid cap value index

% in international stocks: 17.7%
- 87% in total international blend (vanguard)
- 13% in emerging markets

I'm mostly deciding where to shift some of that 41.8% that is sitting in the money market.

Maybe a short term bond fund? Just load it into international index funds?
Also, should I ditch the mid cap and just have a combination of total market + more small caps?

The final %'s look like this:

41.8% money market/savings <---- want to reduce this %
34.4% domestic small cap index value
15.4% international total index <--- put it mostly here?
6% domestic mid cap value
2.3% emerging markets <--- and maybe some here?

^^^

Other questions:
- total international index fund vs. world minus US fund?
- any need to mix in large cap domestic stocks, or stick all to small/mid at my age?

Country you live in
- Finland
Income
- 50k$+
Amount to invest
- ~70k$
Risk Tolerance
- Low to med
Timeframe for investment
- Long-term (years)
Debt
- None
Investing/Trading/Economics understanding
- None, whatsoever
Age
- 23

I would like to think I understand the techno sector at least a bit (computer science student and keep an eye on the IT industry). So, my initial plan was to spend a portion of the equity into buying stocks of tech companies (Google, Microsoft, etc.) and a larger portion into profit proven funds, like the Berkshire Hathaway.. but then I quickly realized that I don't have the knowledge and skills to estimate how well the prices correlate with their real values (ie. are they overpriced). Also, a better informed friend of mine, told me that long term investing is pretty much dead. What do you think of this and what is your advice? Thank you.

Country you live in: Canada
* Income: prefer not to say
* Risk Tolerance: high risk tolerance
* Timeframe for investment: 30-40 years
* Debt: none

This is sort of a hypothetical but I hope to some day have an arrangement like this.

Basically I'd like to set aside $1250-$2000 a month to invest up until retirement. That's like 40 years. Problem is I have no knowledge of investing or finance at all. From what I've read investing in equities would average 10% a year which I would then reinvest. Would this be the best way to invest that amount of money? With 10% compound interest on that amount I'm looking at retiring with like 7-11m in assets. Is this a realistic expectation?

10% a year on equities is probably unrealistic for several reasons. It's certainly not a conservative percentage. But if you're saving for retirement you will eventually want to move to more secure and less volatile instruments reducing your equities exposure. So even if we assume the 10% a year you won't make it with 'sound' retirement investing.

Couple approaches really, but using an All World ex-US type fund leaves your large cap domestics to languish.

Consider dropping the midcap value. I understand the tilt towards mid/small value, but I think in your current make up its weighted too heavily. Letting large caps languish is a recipe for portfolio under performance. Equities that succeed would end up being lost and some of their largest gains that make the largest impact would never be realized to the extent they could be.

With that said..

Without disrupting what you have set for funds/sectors consider the following changes:
7.5% Cash
7.5% Emerging Markets (Vanguard VWO)
5% Total Bond Market (Vanguard BND)
20% US Total Stock Market (Vanguard VTI)
30% Small Cap Value (Vanguard VBR)
30% International Total Stock Market OR All World ex-US (Vanguard VT or
Vanguard VEU)

The difference between the two is ~73% US using VT and 60% using VEU. The shift to AW ex-US adds to Euro and Asia exposure.

You can adjust the percent outflow from cash as you see fit of course, I chose a fairly reasonable distribution to get your large cap exposure up to more "conventional" levels while still leaving small tilt. I added in bonds just to get it started.

Is 7% more realistic? Trying to get a sense of what kind of returns are normal.

And what's the difference between this kind of investing and "sound retirement investing"?

Which translates to:
If you count on 10% ROI in the last 5 years before you start drawing down, you have way too much equity exposure - imagine you were starting to draw down in 2007 and had the kind of equity exposure that would return 10%? You just lost 50-60% of your portfolios value.

I don't really know much about investing so forgive my naivety but hasn't the S&P 500 for example had an average 10% gain per year over the last 50 years or so? Why would investing in it bad? Sure some years would be bad but other years would be good and after 40 years wouldn't it be in the black by a good amount?

Nuc, thanks for the input.

I'm going to start making my transition on Monday, but had a few questions:

1. I've been using the no-load index funds rather than ETF's. I imagine I can just use the equivalents unless you have a strong preference towards ETF's?

Here are my equivalent funds. Let me know if anything looks wrong:

7.5% Cash

7.5% Emerging Markets (Vanguard VWO) --> Vanguard Emerging Markets Stock Index Fund Investor Shares (VEIEX )

5% Total Bond Market (Vanguard BND) --> ??? Which fund should I use? VBMFX??

20% US Total Stock Market (Vanguard VTI) --> Vanguard Total Stock Market Index Fund Investor Shares ( VTSMX ) (I think this is US only)

30% Small Cap Value (Vanguard VBR) --> Vanguard Small-Cap Value Index Fund ( VISVX )

30% International Total Stock Market OR All World ex-US (Vanguard VT or
Vanguard VEU) --> Vanguard Total International Stock Index Fund VGTSX


2. Any thoughts on timing? Should I gradually phase the money in in chunks over the next 6-12 months, or just shift it all at once?

The TMC to GDP ratio now shows the market as roughly "fairly valued" with a 5.5% expected return.

Its not that it would be a bad investment, we aren't saying that.

Basic tenent of investing. Past performance is not indicative of future results.

I tend to go with the ETF's because there is no fund minimum and expense ratios are less and you can liquidate at any time of the day. Vanguard is $3k across the board minimum, which means even the smallest investment has to be sized to $3k at least and then the rest upscaled accordingly.

VBMFX is the mutual fund equivalent of BND Total Bond Market.

The rest looks right.

As for timing..heh. Some believe we are in for a shift in the trend of late, meaning down. When will it begin and how far will it go? Only the shadow knows. If you don't want to fret about that, do half now and half in 6 months. Lump sums have the highest long term EV over any other kind of investing strategy - unless those lump sums are proceeded by large stock market drops ;P So you see why timing is difficult and best left to 'experts' and for the individual investor altogether avoided.

Perfect. Thanks for the advice.

As for timing, this is pretty much what I expected you would say. That TMC to GDP indicator seems like a good metric to use for deciding if the market is REALLY overvalued. For now I think I might just move my money over in 2 or 3 phases over the next year.

Some follow up questions/comments:

ETFs vs Funds - obviously in my 401k all of the options are funds, so that's why I started that route. One big downside I see on ETF's is having to pay the spread. Other than that I really like the ability to buy in real time. I'm not sure how it would work out with other tax purposes. The $3000 mutual fund minimum doesn't really affect me at this point with my portfolio.

Regarding the bond fund - is there any reason you had a preference for a taxable bond fund rather than a tax-free one?

Thanks,
-Z

Without knowing the state you live in, one cannot pick the ideal muni bond fund.

Is this saying after the 3K minimum investment any future investments into the same mutual fund have to be 3K?

I was hoping to make the 3K investment and invest xxx.00 a month into the mutual fund.. Is this not possible?

Sorry for the confusion. To open an fund account it is a minimum of $3000 per fund; so if you wanted 3 funds, it would be $9000 minimum. Subsequent investments do have a minimum of an average of $100.

Vanguard Total Stock Market Minimums:
https://personal.vanguard.com/us/fun...T#hist=tab%3A3

would you get any value out of the 8k tax credit? I think it expires April 30, 2010 and you have to close by June 30, 2010.

that 8k would be huge, but I have no idea how much you are paying in tax on 50k income/year while going to school for MBA