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bacon! posted:I called up Vanguard this week and got the rundown on their mutual funds, how the automatic investing works, etc. It seems great, but most of the funds have a minimum of $3000 ($10,000 for admiral) and I've only got about 30k in my IRA right now meaning I can't get by with a portfolio of mutual funds as diverse as the one I posted above with just ETFs. Just in case he didn't tell you, your regular funds automatically turn into Admiral shares when you reach the $10k mark, so don't stress if you come in a bit below that now if you don't want to put in the full $10 right away. Vanguard definitely has excellent customer service, it's pretty great getting someone knowledgeable on the phone after just a few rings.
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Sep 18, 2011 22:42
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berzerker posted:Just in case he didn't tell you, your regular funds automatically turn into Admiral shares when you reach the $10k mark, so don't stress if you come in a bit below that now if you don't want to put in the full $10 right away. This is great news! I will cut it down to about 5 funds and most of them will pretty close to Admiral status. Sweet!
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Sep 19, 2011 01:06
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Lyon posted:I'm kind of at a loss for what to do right now and was hoping for some advice. Quoting your whole post since it's a new page and you might get lost. I don't know about most of it, but there's no reason not to fund your Roth as you go instead of waiting till the end of the year. You can't time the market or anything by waiting or not waiting, and it's a long term investment, so you might as well just do it as you go so that (in good times anyway) your money can have more time to increase in the Roth. If interest rates were decent it would maybe be worthwhile to build it up in SmartyPig first, but as it is, there's no point. For your other savings stuff... I dunno. There's not too many good places for savers who want to grow their money right now  Might as well use SmartyPig for your Life fund (marriage/house/etc.) unless you want to go a little higher risk with bonds or something.
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Sep 19, 2011 21:38
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Eggplant Wizard posted:Quoting your whole post since it's a new page and you might get lost. I don't know about most of it, but there's no reason not to fund your Roth as you go instead of waiting till the end of the year. You can't time the market or anything by waiting or not waiting, and it's a long term investment, so you might as well just do it as you go so that (in good times anyway) your money can have more time to increase in the Roth. If interest rates were decent it would maybe be worthwhile to build it up in SmartyPig first, but as it is, there's no point. That's a good point, maybe I'll just setup a Vanguard direct withdrawal for the amount. It was never a time the market thing, more of a, "I just opened it last year and did a lump sum of $5k in 2010 so why not do the same in 2011" thing. Seems cash is the best/safest in regards to holding money so I'll just have to start differentiating what certain piles of money are for. I've never exceeded my $2,500 monthly income (come drat close to breaking even though once or twice) so I've never had to dip into savings. I guess now I'll start creating weird categories in Smarty Pig so when the need does arise I'll know what I can take from where etc.
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Sep 19, 2011 22:01
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bacon! posted:The dude on the phone was extremely helpful and seemed very committed to low cost, indexed investing.
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Sep 20, 2011 00:10
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Lyon posted:That's a good point, maybe I'll just setup a Vanguard direct withdrawal for the amount. It was never a time the market thing, more of a, "I just opened it last year and did a lump sum of $5k in 2010 so why not do the same in 2011" thing.
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Sep 20, 2011 17:42
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Chin Strap posted:You don't have to have 15 different funds to be diverse. You can just do something like the three or four fund portfolios here: http://www.bogleheads.org/wiki/Lazy_Portfolios Thanks, I had no idea they were that broad. Do you or anyone else have any recommendations for someone who is 31 as to allocation? 85k had said that he felt that retirement accounts were too heavily weighted toward stocks and I tend to agree looking through my current one. But I'm wondering what would be ample. 30% toward bonds? My biggest concern right now would be that we're entering a lost decade or two with minor growth in stocks and I'd hate to be wasting those years having 90% allocated to them.
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Sep 22, 2011 02:24
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Niwrad posted:Thanks, I had no idea they were that broad. The stock market isn't going to stay depressed for two decades.
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Sep 22, 2011 02:51
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mobn posted:The stock market isn't going to stay depressed for two decades. Not depressed, but maybe the growth won't be what we've historically seen.
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Sep 22, 2011 02:53
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Niwrad posted:Not depressed, but maybe the growth won't be what we've historically seen. You know the fed lowered interest rates on long term bonds today? Bonds aren't exactly going to blaze ahead of stocks for returns. Bonds are valued for their stability, not big returns.
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Sep 22, 2011 03:02
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Niwrad posted:My biggest concern right now would be that we're entering a lost decade or two with minor growth in stocks
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Sep 22, 2011 03:03
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I understand. I was mainly going off the advice of 85k who had said he felt that retirement funds are to heavily allocated to stocks. I'm not looking to allocate all my money to one or the other, just find a nice balance for someone who is pretty conservative with his money.
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Sep 22, 2011 03:11
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Question regarding maxing out a 401k. My company does a really good matching (I put in 2% and they match that with 8%). On top of that, I have several extra % going into both a Roth IRA as well as a normal 401k. I noticed on my paycheck the other day that it didn't deduct my Roth like it normally does. When I went to check my funds, I found that overall I look like I have right around $16.5k for the year overall and $5k into my Roth. Until now, I wasn't aware there was a limit for the yearly contributions. Since there's still three months left in the year, did I kind of shoot myself in the foot by contributing too much earlier on as opposed to contributing a little less and letting my employer keep matching through the end of the year?
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Sep 22, 2011 05:53
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mobn posted:The stock market isn't going to stay depressed for two decades. Frankly, you don't know that. The fundamentals of the economy are getting worse and worse and given the political climate, there's very little in the way of it getting better.
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Sep 22, 2011 10:23
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Shipon posted:[...] there's very little in the way of it getting better. Nor do you know that either. Really though, predicting the future isn't something you need to be doing [and shouldn't be doing if you want to keep your money]. Of the books in the OP that I've read, they all suggest creating a portfolio that you don't obsessively check and buy/sell from. A good long-term portfolio in any political or economic climate is one that you only need to check once every couple months.
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Sep 22, 2011 13:04
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Niwrad posted:Thanks, I had no idea they were that broad. I think approximately age% in bonds is a perfectly reasonable thing to do. Remember you aren't you aren't trying to win the investment game when it comes to retirement, you are just trying to do good enough. Higher bond allocation may mean slightly less return, but it is higher peace of mind with less variance to potentially scare you off your plan. I'm 26 and have 25% in bonds. When I get near 30 I'll up that allocation.
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Sep 22, 2011 13:29
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Unless you have more than $75k, your savings rate has a larger impact on your portfolio value than asset selection. After that point, compound returns take over and you should be much more concerned with what your allocation is. I recommend making a 75/25 portfolio and focus on creating a nice stream of savings into your account. That is where you will get your most value.
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Sep 22, 2011 14:00
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mobn posted:The stock market isn't going to stay depressed for two decades.
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Sep 22, 2011 14:36
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gvibes posted:I am sure the Japanese were saying the same things twenty years ago. His point is not that it couldn't happen, but that it's foolish to think that you can predict it one way or another. The more prudent path to take is to pick an appropriate allocation, rebalance at least annually, and stay the course. Overall, the economy has been flat, but sectors have seen growth that you would be able to capitalize on through rebalancing.
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Sep 22, 2011 14:45
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TraderStav posted:His point is not that it couldn't happen, but that it's foolish to think that you can predict it one way or another.
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Sep 22, 2011 16:30
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gvibes posted:I didn't take that as his point, but agree with you on the prudent path. You're right, my fundamental reading skills were off this morning. I disagree with him also!
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Sep 22, 2011 16:34
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TraderStav posted:Unless you have more than $75k, your savings rate has a larger impact on your portfolio value than asset selection. After that point, compound returns take over and you should be much more concerned with what your allocation is. I recommend making a 75/25 portfolio and focus on creating a nice stream of savings into your account. That is where you will get your most value. This is the truth. There are a lot of people who are very  about their portfolio with $3,000 - $5,000.At that point, (assuming it's retirement and not something shorter term) you're just fine putting it in an S&P Index (100% Stocks  ) or a Total Bond fund ( ) It just doesn't really matter that much because when you only have $5,000 your 10% 'awesome' return won't be as much relative to your individual contribution. Don't get me wrong, compounding long term is extremely important but you need to focus first on getting your money in and working for you now rather than finding the magical 14 funds that will create a perfect portfolio.Do not let the complexity scare you off, focus first on saving the money.
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Sep 23, 2011 16:40
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Is it stupid to keep 20% of your total assets in a standard bank account and the rest in a diversified financial portfolio that is pretty low risk but isn't guaranteed either? I recently got a financial adviser and I'm being setup on a plan that helps with my business so a good chunk of my money will go in mutual bonds and SEP-IRA for tax purposes. For some reason I still feel I should have some money in a standard bank account.
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Sep 23, 2011 19:43
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mechanic virus posted:Is it stupid to keep 20% of your total assets in a standard bank account and the rest in a diversified financial portfolio that is pretty low risk but isn't guaranteed either? I recently got a financial adviser and I'm being setup on a plan that helps with my business so a good chunk of my money will go in mutual bonds and SEP-IRA for tax purposes. For some reason I still feel I should have some money in a standard bank account. I would think that depends on how much liquidity you need over a period of time. But perhaps others have a more detailed explanation or understanding.
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Sep 23, 2011 20:21
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downout posted:I would think that depends on how much liquidity you need over a period of time. But perhaps others have a more detailed explanation or understanding. 6 months of cash in the bank, rest into your investment portfolio is a good start. Provided you don't have any other liquidity needs. Shouldn't your financial advisor be suggesting something? Is he compensated by commission or fees only?
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Sep 23, 2011 20:28
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mechanic virus posted:Is it stupid to keep 20% of your total assets in a standard bank account and the rest in a diversified financial portfolio that is pretty low risk but isn't guaranteed either? I recently got a financial adviser and I'm being setup on a plan that helps with my business so a good chunk of my money will go in mutual bonds and SEP-IRA for tax purposes. For some reason I still feel I should have some money in a standard bank account. More importantly, if it helps you sleep at night, hell yes keep some in the bank. There's no point chucking it all in the stock market if you're going to be frantically micromanaging it and will panic and cash out as soon as the market dips rather than riding it through. I've got a 50/50 split between a Vanguard account and an internet bank account earning 6.5%. That's highly conservative for my age but once I've got a little more in the bank all my new savings will start going into Vanguard.
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Sep 24, 2011 00:04
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Where are you getting 6.5%? That's a hell of an interest rate right now.
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Sep 24, 2011 00:08
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T-1000 posted:If there is any chance that you might need the money within the next 3 or so years, keep it in the bank, with as little fees and as much interest as possible. As TraderStav said, you need at least a few months of living expenses saved up, in case you lose your job or get sick and can't work. I like to have an additional super-emergency fund in case my car gets destroyed in a flash flood or the fridge dies or I have parking fines/medical bills/whatever at the same time as I'm not working. Yea I'm new to this so I told my financial advisor that I'd like to have atleast 20% in the bank just incase something should go terribly wrong but I like to get other opinions as well. As far as being laid off I'm self employed so short of an industry collapse I can't see actually needing that money in 3 years granted everything ran smoothly (knock on wood there is no major medical problems either). Thanks for all the advice guys 
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Sep 24, 2011 00:14
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Lyon posted:Where are you getting 6.5%? That's a hell of an interest rate right now.
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Sep 24, 2011 01:10
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T-1000 posted:I'm in Australia, conditions are slightly different here. What's the best you can get in the US? 1.5%? Maybe?
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Sep 24, 2011 01:20
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silvergoose posted:1.5%? Maybe? Ten year bond is below 1.70%, we're all doomed.
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Sep 24, 2011 01:29
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That is, wow, I don't really know what to say. Move out here, I guess?
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Sep 24, 2011 01:53
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T-1000 posted:That is, wow, I don't really know what to say. Move out here, I guess? It's all relative. Can you get a 30 year fixed, non-recourse mortgage for ~4%? (I hope not!) For mechanic virus: Depending on how old you are and how much 20% is, 20% cash could be a bit too conservative. However, considering that you are self employed you need a much larger safety net than most. Obviously depending on your industry, but there isn't a contractor alive today that wouldn't tell you, if you could afford it, a 1+ year safety net is a great idea. Without magnitude numbers, or at least relative to how many months of expenses, and background information about industry and age anything is just a rough guess.
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Sep 24, 2011 02:41
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I've got some free time coming up in the near future and my goal is to actually learn how to invest for the long term. Are the books in the OP still the best ones to read?
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Sep 24, 2011 03:44
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KennyG posted:It's all relative. Can you get a 30 year fixed, non-recourse mortgage for ~4%? (I hope not!) Residency Evil posted:I've got some free time coming up in the near future and my goal is to actually learn how to invest for the long term. Are the books in the OP still the best ones to read?
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Sep 24, 2011 04:26
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T-1000 posted:Haha, fair point. Having worked for, and being a friend of Rick Ferri, I highly recommend all of his books. He absolutely knows his stuff and always has the investor in mind when he writes.
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Sep 24, 2011 14:44
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T-1000 posted:That is, wow, I don't really know what to say. Move out here, I guess? What's the inflation rate in Australia right now? 6.5% in the bank would be pretty horrible if you're dealing with 7% inflation....
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Sep 25, 2011 17:18
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flowinprose posted:What's the inflation rate in Australia right now? 6.5% in the bank would be pretty horrible if you're dealing with 7% inflation....
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Sep 26, 2011 11:39
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Could someone help clarify the 401k limit for me? Is the $16500 a total limit on personal+employer contributions? My work contributes ~2k regardless of what I put in, and I'm planning to max out the rest. I just can't tell if that means saving 16500 a year or 14500 a year.
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Sep 27, 2011 19:47
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Scissors posted:Could someone help clarify the 401k limit for me? $16,500 is the amount your can contribute personally, and employer contributions aren't counted towards that total.
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Sep 27, 2011 19:52
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