Financial matters.

Off Topic
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What’s up everyone?

I wanted to use this board and hopefully you all can link me to some place else.

I am 20 yrs old and attending college.I have savings in my bank account but I have a big goal : I want to accumulate and make that money grow as much as possible in as fast as it can grow.

I need some place where I can learn what I can do with that money sitting there.I came across a very inspirational article :

http://money.cnn.com/2003/06/16/pf/millionaire/rp_millionaire_wask/index.htm?cnn=yes

So if you all can direct me to the appropriate messageboards or website where I can get good advice(while I’m young),pls do so.

Thanks.

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Just my 2 cents. Here is a copy of a weekly newsletter I receive from mutuals, home of the Vicefund.

Funny thing you mentioned finance, I was going to trash it. If it can help you, all the better!

MUTUALS- Insight of the Week
Unvarnished Information since 1994
June 16, 2003 to June 22, 2003 - Volume XIX, Issue 294

RICH MAN…POOR MAN

Quote of the Week:

“A person who wants a glass of milk should not sit in a pasture and wait for a cow to back its ass up to them.”

Mahatma Gandhi

Recently, I had a discussion with a recent college graduate, whose parents just bought him a brand new $52,000 BMW as a graduation present.

This young gentleman (who, by the way, has never held a single job in his entire life) was telling me about his aspirations of becoming the CEO of a “big” company and retire as a multi-millionaire before he turned 35 of age. He was a big fan of television and seemed to know a lot about the cars that famous people drive and the sizes of the houses of various famous people.

I proceeded to tell him about The Rich Man and The Poor Man (repeated below). I’m almost certain that it didn’t penetrate his young, granite skull, but hopefully some of this information can help you.

The funny thing about this little story is that many people in America mistakenly believe that the person with the nice car, the big house, and the 3 ex-spouses, IS the RICH man. But, as I’ve heard here in Texas, most of the time these people are “All Hat and No Cattle!”

RICH MAN:
This man or woman cares little about the latest car, the latest fashions, or the newest hot spots. He or she is typically married to the same person for a long time, lives in a modest neighborhood, and earns a decent living in a long-term career. They have little debt, great relationships with family, friends, and co-workers, and they save more than 20% of what they earn. These people rarely talk about their investments and never discuss “hot” stocks or mutual funds. In many cases, they don’t even know the stocks or bonds they own, because they have a long-term relationship with their money management firm, which, by the way is not compensated by commissions or transaction fees. They are also known to invest in good mutual funds for the long haul, and in most cases they don’t pay much attention to the ups and downs of the market. These people would no sooner attempt to buy, sell, or trade their investments (i.e. do it themselves) than they would do heart surgery on themselves. They pick an investment strategy, max out their retirement plans, and do the same thing year after year. Many POOR MEN (described below) say that these type of people lack excitement in their lives. Yes…that may be true, but many people think that Warren Buffet is boring. The fact is that Warren Buffet himself has described successful investing as BORING. “It’s like watching grass grow for 30 years”, he says. That’s pretty boring. But he built a $30 billion portfolio by being boring for a long, long time.

POOR MAN:
This man or woman likes excitement. They want the newest cars, the latest fashions, and the nicest restaurants. They strive to be on the “A-List”. They need to build a custom home, because none of the 40 million already-existing homes fits their expensive tastes. They have a penchant for excitement and change; which leads them to change jobs, change friends, and change spouses more than the boring RICH MAN (or woman) does. When investing, they need to be in on the action. They need to be in the hottest stock or the hottest mutual fund. They need to chase the markets…because it gets their blood going. At parties, they talk about the latest hot stock or fund that they’ve recently purchased. After the stock they’re watching hits a high, then they pounce on it. Like storm chasers tracking tornadoes, investors who chase performance put themselves at risk and, more often than not, they run into rough weather. They’ve got a pocket full of credit cards and they use them frequently. They typically have a lot of debt and little net worth. They would never invest in mutual funds long-term or use a money manager because they reason: “Why pay a flat fee to a money manager, when I could just do it myself”. I’ve even heard that some of them, when they are in need of heart surgery, have been known to attempt that themselves as well. These people rarely achieve long-term wealth and never seem to get their act together…but, there is always “excitement” in their lives.

Which one are you gonna be?

Have a great week!

Respectfully,

R. Sapio, 6-19-2003

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  Maybe some education on stocks, bonds, mutual funds, and investing?

  Check out http://www.investopedia.com/university/.

  If investing in any of the above is in your future, check it out. You will learn about stocks, funds, bonds in detail, technical analysis, online investment, index investing....and so forth and so forth. There's a miriad of subjects to read on - and trust me you will come out much more knowledgeable. I myself am looking into investing in the future (once I have enough saved up)

  Also check out Yahoo's finance page - it has a lot of detailed info on investing basics.

  A friend of mine grew a fortune by investing alone. He said it took him some time to really know what he was doing, but that he grew his finances by 70-80 grand each year, on average. He doesnt do it anymore because it requires A LOT of DEEP, EXTENSIVE research on each company, its past, how its doing at the present, what the future prospects are, who is managing the company, and how long he's been there - and what his track is - if the company's coming out with new products, what the expected impact will be, what the competitors are doing, if the company is relocating (which means profits will be less because of relocating expenses, and therefore value of your shares may decrease), and so forth. He did for about 5 years until he went back into the engineering field.
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If you are investing LONG TERM (no need of the money in the next 5+ years) and you like simple plans, , follow one of Peter Lynch’s comments: Invest in index funds appropriate to your financial needs and risk tolerance and let time do it’s work. Investors are far better off trying NOT to time markets. Consult a professionnal. Also, if you like to read more, look at John C. Bogle’s and Nick Murray’s (Mr. Vanguard) books. I have lots more references if you want them!

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Most millionaires I know personally did it through real-estate.

I wish I listened to them 10 years ago. I’m starting 10 years too late, but better late than never.

Peace

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Check out the book “Rich Dad, Poor Dad” it tells a lot about different ways to make and create wealth. I also learned a lot from Investors Buisness Daily. They usually have free seminars in your area and teach you how to pick stocks. I’ve had pretty good success with their method.

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Money?

Yes please.

I would be careful about making that money grow as fast as possible. Every response on the thread is spot-on: you need to be patient and let it grow continuously as possible. A couple years ago, probably at your same age, I lost almost $30000 when I got greedy and tried to mess around with stocks I had been given as a gift from someone who knew a hell of a lot more than I did. Of course, the fact that one of the stocks plummeted big-time after such a long prosperity wasn’t my fault. However, Pfizer seems to keep going up - I always like to think that I’m profiting from someone elses erectile dysfunctions. :wink:

In all seriousness, I would put as much of that money into retirement related funds - the stuff that moves very slowly. I’m pretty sure some of it isn’t touchable by the gov’t under your circumstances, thats always a plus. Another place to look is water-quality control related funds. I’d guess for the next ten years you have a 70/30 chance of profiting fairly well on anything involving cleaning up the water. If a president with any kind of pro-environment platform ever comes into office, you want to be in on things related to the smokestack scrubbers. I don’t know what those are, but they are something that eventually will become necessitated unless some drastic changes take place.

I’d stay away from Martha Stewart Living, although incidentally i just found out she used to be a trader on wall street before she became queen tupperware.

Above all, if I were you, I’d focus more of my energy into solidly earning money by doing something the best that I could - quality will reap its rewards in the long run.

Good luck,
Adam

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You’re a college kid, so you probably can’t make the monthly mortgage payment, so if I were you, I"d put the money in mutual fund.

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Go check out:

And read, read, read!!

GREAT source of investing/money info.

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First of all,thank you for all who replied,there’s a great wealth of info here.

I didn’t mean to make it sound like I wanted to become a millionaire by age 35 like that article.It inspired me to think MORE about what to do with the money I earn and I want to take the right steps in investing them wisely(and get good returns).My parents are wise investors,it’s a wonder I didn’t ask them first(well,I did,some time ago,but I kind of forgot 50% of what they said).I’ll be talking to them some time later.

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I’ll second that recommendation for fool.com. Making your money grow over 20% per year, on average, year after year, with about half an hour’s worth of research per year, is hard to argue with. The results are historically proven, and - nothing against the Vangard Fund, which requires NO research per year - will kick the absolute bejeezus out of any mutual fund out there. Vanguard has paid about 10% per year over the last ten years. Compound whatever amount of money you’d like at 10% over 20-30 years and at 20%+ over the same time period, and you’ll be amazed at the difference.

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IRON3AR: Millionnaire by 35? Either you find some mighty big growth (without crash) investment strategies, combined with big regular investments or you take the entrepreneurial route. Not to sound too cliche in the passive vs active getting rich methods, but Bill Gates did get far more richer than Warren Buffett in a far shorter period.

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iron3bar–
Im glad to see that you are looking at your financial future , as few do at our age. Right now, since your in a period of your life where you need to growth, the best start would be a growth fund. However i would do two thirgs before you actually start investing:

  1. Plop enogh of that money to live off of for 3 months if the worst happens… your parents die, you lose your job, your girlfriend produces a baby, ect. An emergency fund is something we all should have

  2. Go see a financial planner and let him sort through your risk needs , and individual situation to find the right fund for you. Its too big of a decision to make by yourself or from some money mag.

Anyway guys , im a finance major at SFA in nac, im graduating in december and then do our mba program. I want to be a financial analyst and bone a bunch of hot chicks
-lumbernac

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“I want to be a financial analyst and bone a bunch of hot chicks…”

Classic