It's a shame I didn't ask this questions in the beginning. Of course, I may have not received an answer either. Most of the people I know don't have a clue when it comes to investing.
My first experience in investing would have been shortly after I left the army. I had amassed a whopping $1,000 in savings. It was time to get rich. In case you didn't know it, your options are limited when you only have $1,000 to invest. I was undecided between buying shares in Southwest Airlines or an Oakmark Mutual Fund. This would have been back in 1996. I decided to try the Oakmark fund. The funds were growing at a decent rate. Unfortunately, I decided to pull the money out and invest it into an online business I started in 1998. I'm sure you can imagine how that went.
In 2004, I decided it would be a good idea to start putting money into my job’s 401k. This really is a no-brainer. You put $1 in and they match $1. You just doubled your money. Of course there are some other things involved, but basically that's it. When the market nose-divided in 2008, I saw a great opportunity. I started to put 15% of my paycheck in my 401k. I figured either the marked would rebound like it always has or our money was going to be worth nothing anyways. This was the first smart thing I did. It paid off pretty well.
After leaving this job, I was left without the option to continue investing in that 401k. So, it was now time to try investing on my own. I had been watching Mad Money over the last few months and reading stock related teachings on the Internet.
What I realized after a while was none of these people really knew what to do for certain. Take CNBC for an example, none of the experts can agree and what they say on way day is contradicted by them on the next day.
In all his mess, I find Jim Cramer on Mad Money the clearest voice of help or instruction. However, there is still a problem. Cramer does not hit 100%. Currently he holds a couple of dozen stocks in his charitable trust. Some of these stocks go up and some go down. Most of them go up. I have no idea which ones they will be. Neither doe he or he wouldn't have the losers. I can't afford to buy stock in all of them. So, now what? If I pick the wrong one, I’m in trouble.
It would seem evident that I should stop trying to be a stock guru and just stick with a few well run mutual funds. Ah, now another problem. There are a lot of sucky funds.
Maybe you’re familiar with the repeated statement, "80% of all funds do not outpace the S&P 500." At this point, I believe index funds are a smart choice for a non-investor who wants to invest. Unless, someone is willing to get a ton of education and risk, then a fund like Vanguards index 500 fund is a great choice.
My Losses to date:
My Success to date:
My Current Stakes:
DLN - In a Roth IRA
My 401K investments are not listed.
No comments:
Post a Comment