IF - If you had

BochimanBochiman Posts: 24,623 ✭✭✭✭✭

~$3500 to invest for a teenager (in a Roth IRA) to start them off, because they worked during the summer and you want to teach them about the power of saving and investing, what FUNDS, or indexes, would you think of doing? Why?

Already have him a little gold, a little silver, and some coins. Want to add some stock fun in a roth IRA. Limited by what he made last summer.

TIA

I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

«1

Comments

  • derrybderryb Posts: 26,552 ✭✭✭✭✭
    edited April 2, 2019 4:32AM

    I'd let the cash sit in the account until the market starts a big decline and then put it in TVIX for the ride down. I'd also do my account with an online broker such as Ameritrade so that the account could be self managed.

    When exposing a crime is treated as committing a crime, you are being ruled by criminals.

  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭

    He earned the money let him decide.

  • jmski52jmski52 Posts: 19,303 ✭✭✭✭✭

    Stocks are at all time highs. Keep a cash account ready and teach him how to wait.

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • Jinx86Jinx86 Posts: 3,111 ✭✭✭✭✭
    edited April 2, 2019 6:32AM

    I didnt know anything about the stock market as a teenager. I did some research, but back in the late 90's early 2000's there wasnt a whole lot out there for self directed that I could get into. I parked my money in 100 oz silver bars at 6.50-7.50 an ounce. I was working as a mechanic and machine operator for my uncle over the summers doing custom combining work, long hours, great pay for a farm kid.

    I got lucky.

  • derrybderryb Posts: 26,552 ✭✭✭✭✭

    @Jinx86 said:
    I didnt know anything about the stock market as a teenager. I did some research, but back in the late 90's early 2000's there wasnt a whole lot out there for self directed that I could get into. I parked my money in 100 oz silver bars at 6.50-7.50 an ounce.

    I got lucky.

    Lucky? You got smart.

    When exposing a crime is treated as committing a crime, you are being ruled by criminals.

  • Jinx86Jinx86 Posts: 3,111 ✭✭✭✭✭

    Looking at it though. If I had purchased a wide range of stocks at that valuation back then, I would have far more in equity gains over time. That and 20 years of potential dividends and compounded growth. I knew I wouldn't get rich buying silver and gold as a teen, I saw it as a savings account, one that would be hard for me to spend. I truly did get lucky with the 2009ish market crash and silvers run up to 48 in 2011. Otherwise I would be sitting on roughly the same value of silver I started with.

    I am far from being against owning silver/gold. I still own both in quantity, but only as sudo cash reserve for the next big crash, just to convert to cash and by stocks at a discount.

  • jmski52jmski52 Posts: 19,303 ✭✭✭✭✭

    I saw it as a savings account, one that would be hard for me to spend.

    Still true.

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • MsMorrisineMsMorrisine Posts: 22,630 ✭✭✭✭✭

    @Bochiman said:
    ~$3500 to invest for a teenager (in a Roth IRA) to start them off, because they worked during the summer and you want to teach them about the power of saving and investing, what FUNDS, or indexes, would you think of doing? Why?

    Already have him a little gold, a little silver, and some coins. Want to add some stock fun in a roth IRA. Limited by what he made last summer.

    TIA

    Vanguard 500 Index Fund Admiral Shares (VFIAX)

    1. low management fee.
    2. tracks the s&p 500 index, so you have the diversification of 500 stocks
    3. it is what is called passively managed meaning they put money into the 500 stocks according to the ratios in the s&p 500. It is thought to be better than choosing an actively managed fund, where some manager tries to picks the good stocks, because most of those underperform the similar index.
    4. there is compounding of dividends
    5. there is a matching stock ETF, VOO, that could be bought but that won't put all of the 3500 to work (no fractional shares on a ETF but fractional shares with the mutual fund) and there is the distraction of intraday ups and downs with the ETF.
    Current maintainer of Stone's Master List of Favorite Websites // My BST transactions
  • HemisphericalHemispherical Posts: 4,390 ✭✭✭✭✭

    @Bochiman

    Have you explained to the teen the power of compounding? Wish someone did that to me when I was younger.

    Just a thought and good on you to get a teenager to start thinking and doing something for retirement. Not many do or care.

  • derrybderryb Posts: 26,552 ✭✭✭✭✭

    per the FED "compounding ain't what it used to be."

    When exposing a crime is treated as committing a crime, you are being ruled by criminals.

  • Timbuk3Timbuk3 Posts: 10,047 ✭✭✭✭✭

    Stay in cash until there's a market correction !!! :)

    Timbuk3
  • meluaufeetmeluaufeet Posts: 481 ✭✭✭

    College Savings Plan 529, especially if you're topped off in 401k, IRA, and Roth.

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    @Hemispherical said:
    @Bochiman

    Have you explained to the teen the power of compounding? Wish someone did that to me when I was younger.

    Just a thought and good on you to get a teenager to start thinking and doing something for retirement. Not many do or care.

    Yes, and that's why he wanted to do this. It isn't just me doing it for him. He is involved. Just like when we were looking to fully fund his GET account (Washington State version of something like a 529) years ago. He was given a choice of us funding some of it or him adding his savings and funding half of it (I wanted him to have skin in the game for his college funding) and he wanted to do it.

    I actually have used my 401k and shown him how much was put in by me and how much has grown over time (stock growth + dividends), so he does see the value.

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    @Coinstartled said:
    He earned the money let him decide.

    I'll give your comment all the value it deserves. Let's see, you have no kid. You don't honor my request for you to ignore my threads or at least not add in non-value. You have no clue of what goes on in my life. Nope. Done.

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    @Jinx86 said:
    I didnt know anything about the stock market as a teenager. I did some research, but back in the late 90's early 2000's there wasnt a whole lot out there for self directed that I could get into. I parked my money in 100 oz silver bars at 6.50-7.50 an ounce. I was working as a mechanic and machine operator for my uncle over the summers doing custom combining work, long hours, great pay for a farm kid.

    I got lucky.

    Luck/timing usually does better than hard work on a lot of financials.
    Given that we already have some PMs for him, and he hasn't expressed interest in playing with buying/selling PMs, we are just holding those until I either use them for retirement reasons :) or until he decides he wants to be more involved in them.

    I grew up near farming as well, so I fully understand what you are saying on long hours, hard work, and good pay.

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    @meluaufeet said:
    College Savings Plan 529, especially if you're topped off in 401k, IRA, and Roth.

    Not worth it at this point. 1 year until graduation and we had already maxed out our state's GET program (and then rolled that into a state 529 once they started it up.....not 6 figures, but not 4 figures either.).

    He paid ~1/3 of the total and that was what I wanted...him to realize his has skin in the game for his college costs and if he dorks around, he isn't just screwing up our money but his as well.

    So, fully agree with you that the 529, for kids, is important, if one can contribute, but we are past that stage now where it really matters....hence me taking the next step to help teach him about saving for retirement, compounding, dividends, etc.

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    @MsMorrisine said:

    @Bochiman said:
    ~$3500 to invest for a teenager (in a Roth IRA) to start them off, because they worked during the summer and you want to teach them about the power of saving and investing, what FUNDS, or indexes, would you think of doing? Why?

    Already have him a little gold, a little silver, and some coins. Want to add some stock fun in a roth IRA. Limited by what he made last summer.

    TIA

    Vanguard 500 Index Fund Admiral Shares (VFIAX)

    1. low management fee.
    2. tracks the s&p 500 index, so you have the diversification of 500 stocks
    3. it is what is called passively managed meaning they put money into the 500 stocks according to the ratios in the s&p 500. It is thought to be better than choosing an actively managed fund, where some manager tries to picks the good stocks, because most of those underperform the similar index.
    4. there is compounding of dividends
    5. there is a matching stock ETF, VOO, that could be bought but that won't put all of the 3500 to work (no fractional shares on a ETF but fractional shares with the mutual fund) and there is the distraction of intraday ups and downs with the ETF.

    Thanks Scott,

    That was something I was looking for... a recommendation on a fund for a reason. I was thinking about the S&P500 tracking, but the one I started looking at is priced too high to really make it worth getting into.

    For this, for him, I am looking for something more passively managed as I already have a UTMA for him that I let him pick his stock on (being an athletic smart kid, he chose NIKE a few years ago....because that is what every kid on the AAU circuit wears).

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • HemisphericalHemispherical Posts: 4,390 ✭✭✭✭✭

    @Bochiman

    Reference UTMA, watch out for the IRS rules for UTMA and the gift tax.

  • KkathylKkathyl Posts: 2,640 ✭✭✭✭✭

    Since money depreciating at minimum of 2% annum And long term treasury is inverted look for something that will stay nuteral yet allow for them to Borrow against for car, school etc. probably a simple CD to start.

  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭
    edited April 2, 2019 10:13PM

    @Bochiman said:

    @Coinstartled said:
    He earned the money let him decide.

    I'll give your comment all the value it deserves. Let's see, you have no kid. You don't honor my request for you to ignore my threads or at least not add in non-value. You have no clue of what goes on in my life. Nope. Done.

    You asked a question and I gave you a legitimate response. This is a general information forum where others learn from threads that they often did not create.

    Your kid I am sure worked hard for the money and is proud of the accomplishment. Probably has a 50 year plus investment horizon and this is a good time let him put some effort into learning about various vehicles that might allow him to see that $3500 grow.

    If on the other hand you dump the money into a fund or a handful of equities (the OFR always has great investment ideas ;) ) and little Bochi loses half of the money, he will look negatively at further suggestions.

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    @Kkathyl said:
    Since money depreciating at minimum of 2% annum And long term treasury is inverted look for something that will stay nuteral yet allow for them to Borrow against for car, school etc. probably a simple CD to start.

    I agree that a simple CD is a good start. I've been working with him on those for over a decade now, so he has a pretty good idea on how those work and the return on them.

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • KollectorKingKollectorKing Posts: 4,474 ✭✭✭✭✭
    edited April 2, 2019 8:20PM

    ba B)

    Appreciation plus + ~2.1% dividend

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    KK - I'm laughing because we already own some...bought a little before the majority of issues, and we stayed in, so far, with the rollercoaster ride these past few weeks...still net positive for us

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • KollectorKingKollectorKing Posts: 4,474 ✭✭✭✭✭
    edited April 2, 2019 8:24PM

    @Bochiman said:
    KK - I'm laughing because we already own some...bought a little before the majority of issues, and we stayed in, so far, with the rollercoaster ride these past few weeks...still net positive for us

    B)

    One can’t go wrong w/ba & amzn period!

  • ChrisRxChrisRx Posts: 5,567 ✭✭✭✭

    @Bochiman said:

    @Kkathyl said:
    Since money depreciating at minimum of 2% annum And long term treasury is inverted look for something that will stay nuteral yet allow for them to Borrow against for car, school etc. probably a simple CD to start.

    I agree that a simple CD is a good start. I've been working with him on those for over a decade now, so he has a pretty good idea on how those work and the return on them.

    A CD rate minus inflation will nearly guarantee that money will not grow.

    With that said Put it all in vtsax. :)

    image
  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭
    edited April 2, 2019 10:14PM

    fine art is another option.

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    glicker aka coinstartled aka your other dozens of alts....you bring nothing to the discussion. just like on the OFR, I am now adding you to the forum's "ignore list". You interrupt threads and add no value, so it gets harder for real people to add value.

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • bluelobsterbluelobster Posts: 1,195 ✭✭✭

    There are only a few responses on this thread that pass muster. What MsMorrisine said is very reasonable.

  • tneigtneig Posts: 1,493 ✭✭✭

    I'd put it in a T.Rowe Price mutual fund family picking one of their index funds. That way he could see how it moves with the market, and later move the money around to other funds within the fund family to experiment. Most funds require $2500 minimum which would be an incentive to add more over time to open two funds (maybe a pre-tax as well) within that family (all online and ez). Learning the stability of keeping the money in, balancing risk, and learning the ups and downs, moving accts around, adding to, getting involved with a monthly statement is valuable hands on learning.

    COA
  • mariner67mariner67 Posts: 2,737 ✭✭✭

    Forget about any “ market timing” as some above are suggesting.
    Put it into an S&P 500 index now and forget about it.
    He is so young it will do very well by the time he retires.
    Studies have shown that even when bought at market tops that such a fund does very well in the long run.
    Market timers usually get hurt in the long run.
    That is what I did for my son.
    Best of luck to you.

    Successful trades/buys/sells with gdavis70, adriana, wondercoin, Weiss, nibanny, IrishMike, commoncents05, pf70collector, kyleknap, barefootjuan, coindeuce, WhiteTornado, Nefprollc, ajw, JamesM, PCcoins, slinc, coindudeonebay,beernuts, and many more
  • BaleyBaley Posts: 20,878 ✭✭✭✭✭

    80% index fund as mentioned.
    20% have him pick 2 or three stocks he likes, buy an odd lot of each and watch their price moves and earnings/news cycles for several quarters. Educational!

    Liberty: Parent of Science & Industry

  • CuKevinCuKevin Posts: 1,403 ✭✭✭

    @mariner67 said:
    Forget about any “ market timing” as some above are suggesting.
    Put it into an S&P 500 index now and forget about it.
    He is so young it will do very well by the time he retires.
    Studies have shown that even when bought at market tops that such a fund does very well in the long run.
    Market timers usually get hurt in the long run.
    That is what I did for my son.
    Best of luck to you.

    Only the 3rd voice of reason on this thread.
    All SP500 index, like voo, or 1/3 each of large, mid, and small cap index funds.

    Choice Numismatics www.ChoiceCoin.com

    CN eBay

    All of my collection is in a safe deposit box!
  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭

    @Baley said:
    80% index fund as mentioned.
    20% have him pick 2 or three stocks he likes, buy an odd lot of each and watch their price moves and earnings/news cycles for several quarters. Educational!

    Best thing to teach a young man is independence as we will not always be around for hand holding. Stock market is a sucker play at these valuation levels and rising interest rates will smoke the funds. The Baley model could easily dump 50% as the folly of a decade of unabated money printing results in near double digit 10 year rates.

    Kid will be discouraged and wonder WTF happened. That is not a good way to create a long term investor.

  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭

    Sorry RMan..I know you don't want me to post here.

    :)

  • cohodkcohodk Posts: 15,372 ✭✭✭✭✭

    @Coinstartled said:

    @Baley said:
    80% index fund as mentioned.
    20% have him pick 2 or three stocks he likes, buy an odd lot of each and watch their price moves and earnings/news cycles for several quarters. Educational!

    Best thing to teach a young man is independence as we will not always be around for hand holding. Stock market is a sucker play at these valuation levels and rising interest rates will smoke the funds. The Baley model could easily dump 50% as the folly of a decade of unabated money printing results in near double digit 10 year rates.

    Kid will be discouraged and wonder WTF happened. That is not a good way to create a long term investor.

    Kinda like a PM investor? Lol. Too funny.


    Excuses are tools of the ignorant
    Knowledge is the enemy of fear
  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭

    PM investor may get stung as well. Gold and silver are quadruple two decade lows.

    Lesson is, $3500 is a decent start on a portfolio, but the input of the investor is equally as important as the benevolent advisor.

  • CuKevinCuKevin Posts: 1,403 ✭✭✭

    I> @Coinstartled said:

    @Baley said:
    80% index fund as mentioned.
    20% have him pick 2 or three stocks he likes, buy an odd lot of each and watch their price moves and earnings/news cycles for several quarters. Educational!

    Best thing to teach a young man is independence as we will not always be around for hand holding. Stock market is a sucker play at these valuation levels and rising interest rates will smoke the funds. The Baley model could easily dump 50% as the folly of a decade of unabated money printing results in near double digit 10 year rates.

    Kid will be discouraged and wonder WTF happened. That is not a good way to create a long term investor.

    It doesn’t matter how ‘inflated’ or not the market is right now. A teenager has such a long time horizon. Buy some RGLD, or similar, if you REALLY MUST ‘hedge’ the regular equities a little.

    Choice Numismatics www.ChoiceCoin.com

    CN eBay

    All of my collection is in a safe deposit box!
  • illini420illini420 Posts: 11,225 ✭✭✭✭✭

    Since the money will be invested for 50+ years, invest it in equities now. Don't listen to those who are guessing we are at the top of the market... it still may be going up from here. And even if it does take a dip, so what, it'll rebound and then some over the next few decades... But keeping the cash on the sidelines now or putting it in a very low interest CD makes no sense given the time you have.

    Not only teach him the power of compounding, but teach him dollar cost averaging by not trying to pick and choose a "perfect" spot to enter the market. Instead, try to invest each year if he can and who cares where exactly the market is at that time... just keep contributing and after 50 years he'll be alright.

  • 3stars3stars Posts: 761 ✭✭✭✭

    VMMXX money market fund. Currently at 2.5%. No market fluctuations to worry about, and unlike a CD you can take money out anytime

    Previous transactions: Wondercoin
  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭

    @CuKevin said:
    I> @Coinstartled said:

    @Baley said:
    80% index fund as mentioned.
    20% have him pick 2 or three stocks he likes, buy an odd lot of each and watch their price moves and earnings/news cycles for several quarters. Educational!

    Best thing to teach a young man is independence as we will not always be around for hand holding. Stock market is a sucker play at these valuation levels and rising interest rates will smoke the funds. The Baley model could easily dump 50% as the folly of a decade of unabated money printing results in near double digit 10 year rates.

    Kid will be discouraged and wonder WTF happened. That is not a good way to create a long term investor.

    It doesn’t matter how ‘inflated’ or not the market is right now. A teenager has such a long time horizon. Buy some RGLD, or similar, if you REALLY MUST ‘hedge’ the regular equities a little.

    The love affair with equities is wonderful. Have not had an extended bear since the 1970's. Magically every crash is followed by a record runup. What the market has not faced since the late 1980's is substantially higher interest rates, particularly in the last decade. Markets have been hypnotized by the reality that there is no realistic interest bearing option that will offer an infation adjusted return.

    Many posters on the forum can look back 20 or 40 years and say, aha, equities.

    Kid who is maybe 16 or 17 sees a three or four year swoon and makes a lifetime decision that equities are not the way to go. Whatever has performed better will look like the long term winner.

    That is called market psychology and is extremely important to folks just getting into the market.

  • cohodkcohodk Posts: 15,372 ✭✭✭✭✭
    edited April 7, 2019 5:45AM

    Kid who is maybe 16 or 17 sees a three or four year swoon and makes a lifetime decision that equities are not the way to go. Whatever has performed better will look like the long term winner

    That is called market psychology and is extremely important to folks just getting into the market

    Which is exactly why he get reasoned and logical input rather than the rantings of chicken little.


    Excuses are tools of the ignorant
    Knowledge is the enemy of fear
  • MCMLVToppsMCMLVTopps Posts: 2,997 ✭✭✭

    @Bochiman said:
    ~$3500 to invest for a teenager (in a Roth IRA) to start them off, because they worked during the summer and you want to teach them about the power of saving and investing, what FUNDS, or indexes, would you think of doing? Why?

    Already have him a little gold, a little silver, and some coins. Want to add some stock fun in a roth IRA. Limited by what he made last summer.

    TIA

    Definitely a Roth.

    Secondly, the S&P 500 Index fund is almost a no brainer. You have a tiny slice of 500 companies. Perhaps some in a Smal-mid/cap Index fund as well. A 50-50 split wouldn't be bad. It is imperative to look at administrative costs, Index funds should be very, very low, like in the 0.0X area.

    He should learn the time value of money and compound interest. Perhaps a cheap financial calculator, or a website where you can play "what if" with him in terms of investing for the future would be beneficial. Once he becomes familiar with the basics of the market, he can move his money as he wishes...I think the two above would be ideal to begin.

    Time, time, time is his most valuable asset at this point in his life. If you can help him realize that saving a little now, on a consistent basis, will make him a very wealthy person when retirement comes, you will have hit a grand slam. When he becomes employed a bit later in life he should max whatever the percentile of his savings in a company match. If they offer to match 3%, he MUST do at least that. Then, as each year goes by, or he gets promotions, he should increase his savings accordingly, 1-2% should not hurt. I am a FIRM believer than you should pay yourself 10% (if able) into some form of savings from each paycheck. If he makes $300/week...$30 goes to him off the top.

    I wouldn't cloud his brain with such things as "A Random Walk Down Wall Street"....too deep for such a young age. No doubt he's more concerned about "Debbie" in High School right now.

    You are a very, very wise man to help set your son on the right path to a nice retirement. I used to talk to my younger relatives from time to time about the importance of saving for the future...not heavy, but just talking reality. They'd look at me like a just landed from Neptune. So, I just kinda don't bring it up.

    Make sure whatever account you open has a very, very strong password that sits on a piece of paper on your computer desktop area...not on his phone. Also, make sure his account is locked so tight that he has to jump through a few hoops to prove who he is should he ever need to make a withdrawal, which I would like to think would be many, many years away.

    I am blessed to have saved a long, long time ago...it wasn't easy sometimes, and I survived the blast in 1987 and other downturns, but, I persevered. I live a very good life thanks to mine and my wive's saving habits.

    Good luck, you're a great dad!!! May your son enjoy the fruits of his labor many years from now.

    Al

  • CoinstartledCoinstartled Posts: 7,417 ✭✭✭✭✭

    @cohodk said:
    Kid who is maybe 16 or 17 sees a three or four year swoon and makes a lifetime decision that equities are not the way to go. Whatever has performed better will look like the long term winner

    That is called market psychology and is extremely important to folks just getting into the market

    Which is exactly why he get reasoned and logical input rather than the rantings of chicken little.

    The thread is short on discussion of valuation. Don't see much talk about what a share of Amazon or Facebook is worth, just that it is up 10 or a 100 or a thousand fold over the last 5 or 25 years. And when blindly suggesting index funds, they are weighted heavily to recent high flying shares that at least deserve intelligent evaluation before the mere suggestion that they have gone way up so they will continue to go way up.

    I have not on this thread suggested one investment of another. To commit all of the young investor's funds to a vehicle that has experienced a recent parabolic surge is foolish, if the intent is to teach prudent investment habits that are intended to last a lifetime.

    Maybe tulip bulbs are an option.

  • skier07skier07 Posts: 1,052 ✭✭✭✭

    S&P 500 tracking fund, 50%, and NASDAQ tracking fund, QQQ, 50%.

    Good luck timing the market.

    If you have $3500 try dollar cost averaging. Do something like $500 for seven consecutive months or something along those lines.

  • cohodkcohodk Posts: 15,372 ✭✭✭✭✭
    edited April 7, 2019 8:55AM

    And when blindly suggesting index funds, they are weighted heavily to recent high flying shares

    Are you sure?


    Excuses are tools of the ignorant
    Knowledge is the enemy of fear
  • Musky1011Musky1011 Posts: 3,787 ✭✭✭

    @skier07 said:
    S&P 500 tracking fund, 50%, and NASDAQ tracking fund, QQQ, 50%.

    Good luck timing the market.

    If you have $3500 try dollar cost averaging. Do something like $500 for seven consecutive months or something along those lines.

    This is the way to go

    Pilgrim Clock and Gift Shop.. Expert clock repair since 1844

    Menomonee Falls Wisconsin USA

    http://www.pcgs.com/SetRegistr...dset.aspx?s=68269&ac=1">Musky 1861 Mint Set
  • MCMLVToppsMCMLVTopps Posts: 2,997 ✭✭✭

    @skier07 said:
    S&P 500 tracking fund, 50%, and NASDAQ tracking fund, QQQ, 50%.

    Good luck timing the market.

    If you have $3500 try dollar cost averaging. Do something like $500 for seven consecutive months or something along those lines.

    Agree completely. I should have added that to my comments...being retired, my situation is much different. Can't make any more contributions to my 401k.

  • msch1manmsch1man Posts: 759 ✭✭✭

    You might look into the Vanguard Target Retirement funds (probably the 2060 or 2065 fund given your son's age). I like Vanguard funds because you get rock bottom expense ratios. I also prefer the "set it and forget it" approach of a target date fund that does all the diversifying and re-balancing for you.

  • BochimanBochiman Posts: 24,623 ✭✭✭✭✭

    @cohodk said:
    Kid who is maybe 16 or 17 sees a three or four year swoon and makes a lifetime decision that equities are not the way to go. Whatever has performed better will look like the long term winner

    That is called market psychology and is extremely important to folks just getting into the market

    Which is exactly why he get reasoned and logical input rather than the rantings of chicken little.

    Exactly right, Cohodk, which is why I asked here. I could ask on investment forums as well, and may have already ;), but I like getting a diverse about of info and there are some smart folks here as well. Of course, there are those that think they know everything and everything about other people's situations just from a few things on the internet.

    You, and a handful of others, have been very helpful. Someone else that posted, that loves to see their own posts even though they really have nothing of value to add...added just that...nothing of value. I'm used to him doing that, though, which is why I have him blocked now and only see when people quote him. He really doesn't add value on any forum he is on.

    $3500 isn't "much" money, but I think I like the idea of splitting between a mid-cap and a S&P500 tracking fund. We'll likely do the buy this week.

    I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment

  • Dave99BDave99B Posts: 5,968 ✭✭✭✭✭

    Awesome idea.

    Timing the market is virtually impossible. I'd split it three ways, and invest it soon.

    60% in QQQ
    30% in VWIGX
    10% in a stock he's researched, and is interested in

    Have fun,
    Dave

    Always looking for original, better date VF20-VF35 Barber quarters and halves, and a quality beer.
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