Yeah I am going to bump up my 401k contribution for sure.

I get minuscule returns on the MM, which is the $ I'm going to throw into a Vanguard fund.

No returns on checking either but I'm going to keep that around $10k to remain somewhat liquid, as most of my other funds will be tied up.

lump sum beats dollar cost averaging mathematically. DCA is purely a tool for dealing with human psychology. if doing it over 5 months makes you feel better, go for it.

but no, for $10k it almost certainly won't matter in the long run.

it's funny you should ask because i was just reading this yesterday:

http://www.fpanet.org/journal/Curren...feSavingsRates

it won't load for me right now but i think this is what you're looking for.

edit: google cache: http://webcache.googleusercontent.co...&ct=clnk&gl=us

roth 401k seems like a bad choice. why lock in your top-of-the-line tax rate?

i think you are too young, uncertain about your future, and impulsive to make owning a home a good idea. renting is a great deal; why rush into such a huge financial commitment?

anyway, short/med term funds belong in high-yield savings. if you know you won't need some part of it for a year or more, you might look at CDs or I Bonds.

long-term, you want a broadly-diversified portfolio. you didn't provide a lot of specifics about your holdings (unless i missed them in your wall of text) but it sounds like you are poorly diversified with heavy bets on various sectors. hence, i'll start by recommending a target date fund.

Tyler,

What do you mean by a target date fund?

I just took my IRA from Vanguard and put it in my TD Ameritrade account and I'm looking to put the $ in either large cap stocks or maybe just in an index fund. I'm 26 and there's only $4k in my IRA(leftover from an old job)

You and me both, only just moved here recently, however that is a good point that I should look into.


Thanks so much for the advice, do you think there are any other interesting options such as cheap real-estate (and renting it out)? Just wondering what some alternatives can be?

Do you mean you withdrew your money from your IRA? If so, why did you do that? And regardless, why did you transfer your money from Vanguard to TD Ameritrade?

A target date fund is a fund that simply invests in domestic and international stocks along with bonds. The "target" is your approximate retirement date. The fund automatically becomes more conservative very gradually as the "target" year approaches. It's a one stop shopping type of fund.

Country you live in
USA (SoCal)

Income
180k

Risk Tolerance
Medium to high

Timeframe for investment
Thinking of something like a Vanguard 2040-45, but also interested in owning (eventually) some properties if that option is still +EV

Debt
None

Any other information you might have that would help us
Am in my mid 20s, have about 300k literally sitting in a bank (don't ask), currently renting. Know next to nothing about investing so looking for any direction / recommended books. Have no 401k / IRAs etc. I'd eventually like to own some investment properties in/near LA (have heard Santa Clarita / Hesperia still has ~100k - 150k properties), but also want to diversify as much as possible. My wealthy uncle is willing to set up an LLC and go halves with me (or whatever I want). I feel like I'd have absolutely no edge over the vast RE investing companies here so not sure how to find +EV investments. I'd guess 6-7 years from now I'd like to pull together enough to purchase / reno my own house.

MalkasGambit - I can't help with the investing angle, but you should be maxing out 401k/IRAs. It hurts my head that you aren't.

What is your interest rate on that 300k? You may want to look into GE Capital Invest Direct or something similar.

Small adjustments can make a huge difference for someone in your position.

good luck

malkas,

i'm with pdiggz. max your Roth (you'll need to do a backdoor roth at your income level) and 401k like yesterday.

a tr fund is fine, though slightly sub-optimal since the bond portion isn't very tax efficient. i'd go ahead and start there while you learn more. i'd look to get into a two-fund or three-fund portfolio so you can concentrate your bonds in tax-advantaged space (and probably use municipal bond funds in taxable space). if you don't understand any of that, that's a terrific reason to use the tr fund instead.

money you want in 6-7 years doesn't belong in your portfolio (unless you don't really need it and can accept high risk with it). i'd instead put it in CDs, i bonds, and, yes, internet savings. (beware person/institution limits on CDs, which iirc are 250k.)

i consider real estate to be an entirely different ballgame, not like regular investing since it carries so much effort/worry. i think you are wise to be skeptical of your edge vs professionals.

A paper has already been published on the topic of “Ideal Money" and with that title. That paper of ours was published in the Southern Economic Journal after a lecture had been given on that topic at the meeting of the Southern Economic Association in Tampa, Florida. So it is better now not to cover again in full the grounds of the ideas presented there and the specifics about how “ideal money" currencies could be arranged for by using linkage to an appropriate index of the prices of internationally traded commodities. (Note that gold and silver are EXAMPLES of internationally traded commodities.)

hi, thanks for any advise!!

Country you live in
Switzerland

Income
85k chf = 90,5k $, expecting on average 5-10% increase every year during next 10 years.

Risk Tolerance
medium-high, i.e. 10-25% up and down every month no problem. but i like only stocks, no options gambling or stuff like that.


Timeframe for investment
10-15 years


Debt
none

Any other information you might have that would help us
hi 2p2! thanks for any hints on this. im looking to invest 40k$ now and over the course of the next 10-15 years, invest another 2k$ per month, maybe more depending how the job goes. the plan is definitely to buy and hold and only re-adjust strategy maybe once a year at most. given my investment horizon and age (29), i want to be 100% equity all the time, well at least for the first 5-7 years. i dont need the money at all now, so some ups and downs are totally ok. the most important thing is, i want to end up with somewhere around 7-8% average annual return. is that even possible ? THX!

if you are investing and hoping to target a specific roi, you're doing it wrong. 7-8% may be feasible in the long run but it doesn't actually matter.

100% stocks is generally considered bad because:
- diversification
- efficient frontier
- no dry powder for rebalancing when stocks crash

if you were an american i'd recommend a target date fund. since you're not, you might have to build one yourself. it's basically just a three-fund portfolio.

google some of those terms and then we can talk more.

well after 1 week of thinking what to do i decided 80% stocks via etfs (sp500, europe, asia, brics) and 20% investment-grade corp bonds.

first day return -2% haha. hope next 10 years will go better.

this seems ok.

i'm not a huge fan of corporate bonds but i have more available choices than you do.

why s&p 500 instead of total us stock? you're missing out on mid- and small-cap exposure.

similarly you might be missing out on emerging markets the way you have your international structured. are these choices deliberate?

why all this trouble instead of, say, a single total world stock fund?

I agree with this, but holding a specific BRIC (Brazil, Russia, India, and China) fund does capture the vast majority of the emerging markets. Still, I second Tyler's post. I'm sure over the long run, this will do fine, but it does seem overly complicated.

have about 10 k sitting in savings Im 29 and want to invest it any good ideas ? every one i talk to says mutural fund ?

WDR, what is your income and risk tolerance?

USA
35k
Low to Med

target retirement fund.

i'm having a harder time than expected figuring out what countries comprise EM. best i could do in a few minutes:

http://us.ishares.com/product_info/f...erview/EEM.htm

op mentioned asia and europe separately, but it looks to me like going BRIC misses out on south korea, taiwan, south africa, mexico, malaysia, indonesia -- about 35% of EM. plus all the even smaller markets that aren't listed.

plus just holding one fund is simpler and probably cheaper.

but like dale said, this is a small optimization and i'm just quibbling because i find this interesting.

Agree, go with vanguard target retirement fund. I just opened one up this year, it was pretty easy and straight forward.

Like I said, I agree with you.

btw, here's the breakdown for Fidelity's EM Index:

Country Diversification2 More Information
AS OF 6/30/2013

China 12.57%
Brazil 12.30%
Taiwan 12.06%
USA 11.02%
South Africa 8.07%
India 7.92%
Russia 6.00%
Hong Kong 5.10%
Mexico 5.04%
Malaysia 4.54%
Indonesia 3.08%
Thailand 2.85%
Chile 1.97%
Turkey 1.97%
Philippines 1.39%
Poland 1.37%
Colombia 1.02%

I think USA must be a typo and should be South Korea. Otherwise South Korea is not represented in the EM fund or the developed international index fund.

It depends on what you mean by "low to med." A target date fund for someone your age is going to be very aggressive. You might want to consider one of Vangaurd's Life Strategy funds.

https://personal.vanguard.com/us/fun...feStrategyList

Probably the Moderate Growth Fund would fit for you or even the Conservative Growth Fund. Again, it really depends on how much volatility/risk you're willing to accept.

i'll clarify that one should never look at the DATE of a target retirement fund except as a proxy for the stock/bond ratio (which is what you're really picking).

so a conservative investor with a 30 year timeline and an aggressive investor with a 10 year timeline could both reasonably hold a TR 2035 fund.

(and i generally recommend TR funds over LS funds because the folks that benefit from all-in-one funds generally also benefit from automated glideslopes.)