Poll of the Day > Mutual fund recommendations?

(+) Yeah! (+)

I'm finally at a point in life where I've saved a lot of money and I'm no longer living paycheck to paycheck, so I'm trying to get involved with investing. I have enough savings to invest $5k and my research and others have told me mutual funds are good place for beginner investors to start.

Are you invested in a good mutual fund you'd recommend? What are the dividend payouts like?

if you give me 5k right now Ill give you 10k in 20 years

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good Idea, ima keep an eye on this here topic brah

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What even is a mutual fund

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Mead posted...

What even is a mutual fund

It's basically a diversified portfolio starter pack. It can have a mix of different stocks, bonds, or both.

Somebody give me one

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bump

If you don't already have a Roth IRA, open one up and contribute 5k for the 2020 year. Vanguard is easy. You can choose a target retirement date fund or just go with VTSAX for a lower expense ratio. Try to get another $1k in before tax deadline. Then you can automate a $500 contribution every month for set it and forget it.

If you already have a Roth IRA you can still open a brokerage account and so the same thing. Just no retirement/tax benefits.

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Clench281 posted...

If you don't already have a Roth IRA, open one up and contribute 5k for the 2020 year. Vanguard is easy. You can choose a target retirement date fund or just go with VTSAX for a lower expense ratio. Try to get another $1k in before tax deadline. Then you can automate a $500 contribution every month for set it and forget it.

If you already have a Roth IRA you can still open a brokerage account and so the same thing. Just no retirement/tax benefits.

Thank you! This is the exact kind of specific advice I was looking for. I do not have a Roth IRA yet, so I will start there.

Personally I prefer ETFs. You get to invest in a basket of stocks like a mutual fund, but it can be bought and sold like a stock.

SPY invests in the entire S&P 500. It's the very first ETF and the largest.

GLD is the second largest ETF and gives you simple access to the gold market.

DOG is an inverse ETF that bets against the Dow Jones Industrial Average. When the Dow goes down, this ETF goes up. When the Dow wins, this ETF loses.

SQQQ is a leveraged ETF that offers 3x the Nasdaq 100. It's extremely risky, you can make triple the money, or lose triple.

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captpackrat posted...

Personally I prefer ETFs. You get to invest in a basket of stocks like a mutual fund, but it can be bought and sold like a stock.

SPY invests in the entire S&P 500. It's the very first ETF and the largest.

GLD is the second largest ETF and gives you simple access to the gold market.

DOG is an inverse ETF that bets against the Dow Jones Industrial Average. When the Dow goes down, this ETF goes up. When the Dow wins, this ETF loses.

SQQQ is a leveraged ETF that offers 3x the Nasdaq 100. It's extremely risky, you can make triple the money, or lose triple.

This is all going a bit over my head. I don't know enough about stocks to want to risk a triple money/triple loss situation.

Speaking of which, if anyone has any resources to educate myself I'm a good learner! I understand a lot of economic theory, but I don't know a lot about actual practical investing and saving.

https://www.reddit.com/r/personalfinance/wiki/iras

I have an IRA, but it's not a Roth. I'm still a bit confused about it because the guy called it a "Rollover IRA." I was taking money from my previous employer's 401k and wanted to put it into an IRA. But that's what I've been putting money into each year. Reddit seems to recommend Charles Schwab or Vanguard. I got mine at Merrill Edge, but I don't know the difference between them all and I'm too lazy to switch.

At my current job, I have a Roth 401k.

I also use an app called Acorns. You link your credit card to it and any charge you make, it rounds up the cost, takes the spare change, and invests it for you (based on whatever portfolio you use). I got about $50 in dividends in December, but that's usually the month with the biggest payout, I think. Dividends seem to be quarterly, semi-annually, or annually. I've been using the app for 3 years, but it was very slow in the beginning (like a couple cents). The app tells me I've gained 2k since starting, but I don't know how to verify that. It seems like I only have its word to go on.

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get a roth ira through one of the "nearly" free places (my wife and ours are through schwab)

and go for etfs instead and just put in your cap deposit every year and use that to diversify or get rid of things that are underperforming

Fidelity. They've got a lot of useful and digestible information to help you invest properly. It reminds me of good video game tutorials where you can just play, and any time a new game mechanic comes up, you can get a quick tooltip to get an idea and access to learn more.

Mutual Funds and ETFs basically do the same thing, and practically, for every mutual fund with a certain goal, there is a ETF with the same goal and vice versa. Such as tracking the S&P 500. The differences are pretty negligible.

2 easiest/no-brainer funds are ones that track either the total stock index or the S&P 500. If you ask anyone for the simplest but best strategy, it is this to invest into a mutual fund or ETF that does this.

If you want to have some fun playing individual stock with low risk, research and buy stock from a company that's part of the S&P 500. Fucking Chipotle is there.

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DirtBasedSoap posted...

if you give me 5k right now Ill give you 10k in 20 years

DirtBasedSoap posted...

if you give me 5k right now Ill give you 10k in 20 years

LOL there's no guarantee someone will be around in x number of years which is one of of the downfalls of 401ks etc.

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JigsawTDC posted...

This is all going a bit over my head. I don't know enough about stocks to want to risk a triple money/triple loss situation.

Speaking of which, if anyone has any resources to educate myself I'm a good learner! I understand a lot of economic theory, but I don't know a lot about actual practical investing and saving.

Etf is like a mutual fund except less fees. It's a. Bunch of stocks mixed together and you buy a piece of that.

Max contribution to an ira is 6000 so try to put that much in this year.

Investopedia is good for learning

How much money you save per year is the most important thing

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JigsawTDC posted...

This is all going a bit over my head. I don't know enough about stocks to want to risk a triple money/triple loss situation.

Speaking of which, if anyone has any resources to educate myself I'm a good learner! I understand a lot of economic theory, but I don't know a lot about actual practical investing and saving.

An Exchange Traded Fund (ETF) is like a mutual fund, in that it's a basket of stocks, bonds, gold bullion, foreign currency, or whatever, but it's traded like a stock. They're sometimes called "Spiders" after their original name, SPDR.

Mutual funds usually have purchase fees associated with them or you're required to own them for a certain length of time before you can sell, and transactions usually only occur at close of business. ETFs trade like a stock, there's no fees (other than your usual stock trading fees charged by your broker), no time limit on ownership, and orders usually goes through in seconds when the market is open. The main difference is that mutual funds are intended for long term investment, usually 6 months or longer, while ETFs can be held for any length of time from minutes to years.

SPY is a pretty good ETF for beginners. It's the oldest and largest, and it invests in every single stock in the S&P 500 index, so buying 1 share of SPY is like buying stock in 500 companies all at once. This lets you spread out your risk with a single purchase instead of having to actually buy stock in 500 individual companies.

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Money missed is better than money lost

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/r/personalfinance has a pretty extensive wiki under investing

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And they link to this a lot
https://www.bogleheads.org/wiki/Lazy_portfolios

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