#31
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Re: Do you understand your personal finances?
NajdorfDefense
If a random person came to you and asked you for advice on how to plan for his future retirement starting right now with no initial capital, but with monthly contributions, what would you come up with for a plan for their money? If that question takes too much to work, are there any books that you would recommend to help with this. I'm extremely curious about what your answer is (or any really knowledgable investor) as this is basically my situation and I was looking at index funds for my primary investment vehicle. (I'm canadian so that will probably change the answer a little, but I'm not sure). remember: I'm a layman and have no idea what an alpha or a beta is with respect to finances. I'm really just probing for advice on how to really get my head wrapped around this. |
#32
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Re: Do you understand your personal finances?
I used to be very into investing my $ and read about investing daily. I invested 90% of my cash in stocks when I was about 19 and kept doing so for a while with good results.
Now I have gotten busy and pretty lazy and most of my money sits there doing nothing. I have about 10% as a poker bankroll and the rest sitting in savings accounts waiting for me to figure out what to do with it. This aggrevates me as I have a pretty sizeable amount of cash to invest. However I don't really feel like walking into my bank to see a financial advisor as I don't think they do a whole lot with my $, but I am not at a point where I'm going to look for my own investments. |
#33
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Re: Do you understand your personal finances?
All,
Happened to come across this blog entry today that mentions a lot of introductory (as well as more advanced) books on personal finance/investing: blog entry |
#34
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Re: Do you understand your personal finances?
no.
350k+ mostly in mutual funds. i handle it. and probably very poorly. |
#35
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Re: Do you understand your personal finances?
[ QUOTE ]
[ QUOTE ] I think if they put a random person in a target VGuard or Fido fund, it'd be better than what 90% of people could do on their own. Or a balanced fund. Something a broker could do with 10hrs of training, for example. [/ QUOTE ] Key words here are random and Vanguard. Folks who end up at Vanguard (randomly or not) are going to be fine. Unfortunately, lots of people randomly end up somewhere else where some broker w/ approx 10hrs of training ends up steering them into "approved" loaded mutual funds w/ high expense ratios. [/ QUOTE ] I'm in the process of moving my funds (at least short term) to a couple of Vanguard index funds (thanks in part to finance forum) and I have a financial advisor. Wow do those guys love mutual funds and wow do they hate these Vanguard Index Funds. This is my nth meeting where they try to steer me towards a new fund but my next meeting I'm 90% sure I'll finally be moving my money into the index funds. It is so hard to convince these guys that index funds are a better option especially when they get paid a bonus for putting a client into a mutual fund A share which they didn't disclose to me initially. I would love someone to reply as to why if a mutual fund seems to have all the right characteristics it is still preferable to go with a vanguard index fund. Sidenote - The current one they're looking to put me in is the Riversource Strategic Allocation Fund. Anyone have an opinion on this one? sorry for hijack, got more to say but got to go. |
#36
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Re: Do you understand your personal finances?
[ QUOTE ]
Sidenote - The current one they're looking to put me in is the Riversource Strategic Allocation Fund. Anyone have an opinion on this one? sorry for hijack, got more to say but got to go. [/ QUOTE ] RiverSource Strategic Allocation A IMRFX Front Load 5.75% Expense Ratio 1.12% They are pushing this fund because they get 5.75% of everything you put in. There is 0 front load with vanguard and most of their expense ratios are < .5%. Please whatever you do, do NOT go with their choice. I would honestly never go back and talk to them again. So basically if the fund returns 8% this year, you really only make 2.25% which is less than every online savings account and not even keeping up with inflation. Hope this helps, and ask if you have any more questions. |
#37
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Re: Do you understand your personal finances?
I've decided if I ever suck at online poker for some reason I could be a freelance accountant / money manager / tax guy and do better for my clients than 95% of the people out there.
Edit: 95% is probably selling myself short. |
#38
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Re: Do you understand your personal finances?
[ QUOTE ]
All, Happened to come across this blog entry today that mentions a lot of introductory (as well as more advanced) books on personal finance/investing: blog entry [/ QUOTE ] Thanks el d. This is gonna be my summer project. |
#39
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Re: Do you understand your personal finances?
Yes and no. Yes: 30% equities, 30% bonds and 15% investment real estate, not counting home equity (substantial) or retirement funds (also substantial because of a big pension payout when I switched careers). The other 25% is in private equity funds that I used to be able to purchase through my old firm. I did so on the premise that I had zero ability to liquidate and zero control over the money, and so regarded it all as a giant flush. I started investing in those in 1999, and the average annual return has been between 25 and 30%.
Retirement funds are in Fido Contra and my company's stock. I would say that I understand where my money is and generally why, but I certainly don't have a coherent long-term strategy other than "earn more than I spend and keep my investments reasonably diverse and reasonably risky." I've been meaning to apply more rigor to it. |
#40
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Re: Do you understand your personal finances?
[ QUOTE ]
[ QUOTE ] All, Happened to come across this blog entry today that mentions a lot of introductory (as well as more advanced) books on personal finance/investing: blog entry [/ QUOTE ] Thanks el d. This is gonna be my summer project. [/ QUOTE ] FWIW, Fisher's book is terrible. Read Graham, Greenblatt, Pabrai, O'Shaughnessy, Damodaran, and Lynch for primers on investing and valuation. |
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