Finance/Investments

[StrangeSox]

bankrate.com has some pretty good loan calculators:

 

http://www.bankrate.com/calculators/auto/e...calculator.aspx

 

In general, student loans are virtually impossible to get rid of even through bankruptcy, so it can be a good idea to get rid of that debt above almost anything else. I'm not sure how hard and fast that rule is with the relatively recent payment caps and eventual loan forgiveness stuff, though.

[pettie4sox]

Necrobump to some extent.

 

I started a new job recently and I am taking advantage of the match to the full.

 

I have saved some money via retirement accounts in the past but I'm not nearly where I need to be. This is probably a vague question but when do you need to start saving more money in your retirement account to make sure you're OK when the time comes?

[StrangeSox]

The earlier the better thanks to compounding interest.

 

"If you can" is a pretty good and short intro guide on retirement investing. https://www.etf.com/docs/IfYouCan.pdf

 

General guidelines I've seen and follow are:

 

--Save in your 401k up to your employer's match. If they match the first 5%, put in that much. It's free money.

--Beyond the employer match, put your next chunk of retirement savings into an IRA or Roth IRA. Which makes more sense for you depends on your current income levels (both phase out as income goes up) and your current and expected retirement tax brackets. The reason to go with your own IRA over your work's 401k is you can choose someone like Vanguard or Fidelity (and I think Schwab) who offer very-low-cost funds whereas you're going to be pretty limited in your options in your 401k.

--Once you've maxed your IRA contribution limits ($5.5k/year right now), increase your 401k savings. That caps out at 18% of your income a year.

 

If you max your 401k and your IRA space, congrats, go see a real financial professional because you've got a good problem on your hands.

 

 

[Chisoxfn]

Necrobump to some extent.

 

I started a new job recently and I am taking advantage of the match to the full.

 

I have saved some money via retirement accounts in the past but I'm not nearly where I need to be. This is probably a vague question but when do you need to start saving more money in your retirement account to make sure you're OK when the time comes?

My view is you should do it as soon as you start your career. Set it and take advantage of compounding growth. At a minimum, you should set it and take advantage of your company match. I'm an old fogie (at heart) and I believe in living below the means. If you start that way, then as you get more income, you just slowly increase what you put in 401K's and you never have this big "hit" because you suddenly start investing (after you got used to spending that new found money when you initially start your career).

[Chisoxfn]

The earlier the better thanks to compounding interest.

 

"If you can" is a pretty good and short intro guide on retirement investing. https://www.etf.com/docs/IfYouCan.pdf

 

General guidelines I've seen and follow are:

 

--Save in your 401k up to your employer's match. If they match the first 5%, put in that much. It's free money.

--Beyond the employer match, put your next chunk of retirement savings into an IRA or Roth IRA. Which makes more sense for you depends on your current income levels (both phase out as income goes up) and your current and expected retirement tax brackets. The reason to go with your own IRA over your work's 401k is you can choose someone like Vanguard or Fidelity (and I think Schwab) who offer very-low-cost funds whereas you're going to be pretty limited in your options in your 401k.

--Once you've maxed your IRA contribution limits ($5.5k/year right now), increase your 401k savings. That caps out at 18% of your income a year.

 

If you max your 401k and your IRA space, congrats, go see a real financial professional because you've got a good problem on your hands.

This is excellent advice.

[bmags]

I have followed the principle of increasing my 401k/retirement savings by 1% every year which has suited us well.

 

Luckily our work has great 401k options and had a CFO who made a point to finding us lowest fees and index fund options.

[pettie4sox]

The earlier the better thanks to compounding interest.

 

"If you can" is a pretty good and short intro guide on retirement investing. https://www.etf.com/docs/IfYouCan.pdf

 

General guidelines I've seen and follow are:

 

--Save in your 401k up to your employer's match. If they match the first 5%, put in that much. It's free money.

--Beyond the employer match, put your next chunk of retirement savings into an IRA or Roth IRA. Which makes more sense for you depends on your current income levels (both phase out as income goes up) and your current and expected retirement tax brackets. The reason to go with your own IRA over your work's 401k is you can choose someone like Vanguard or Fidelity (and I think Schwab) who offer very-low-cost funds whereas you're going to be pretty limited in your options in your 401k.

--Once you've maxed your IRA contribution limits ($5.5k/year right now), increase your 401k savings. That caps out at 18% of your income a year.

 

If you max your 401k and your IRA space, congrats, go see a real financial professional because you've got a good problem on your hands.

 

I currently do 8% of my salary 2% match and up to 8% at 50%. I was going to do it for a year, pay down some debts and re-evaluate then.

 

I'm in a precarious situation because I have my sports betting account but I can't do anything to it because I can't figure out the tax implications, so it's safer to keep it in there for now. Most accountants don't know how to proceed with online sports betting winnings.

[bmags]

I would not consider keeping money in a sports betting account safe, but that's just me. Not after what happened in the online poker world.

[pettie4sox]

I would not consider keeping money in a sports betting account safe, but that's just me. Not after what happened in the online poker world.

 

I agree, but I still make bets and such. It's not an idle account for sure. I just don't want to pay any taxes on it when I withdraw it.

[bigruss]

I agree, but I still make bets and such. It's not an idle account for sure. I just don't want to pay any taxes on it when I withdraw it.

Good luck with that

[pettie4sox]

Good luck with that

 

I'll find a way, why should I have to get taxed if the big dogs don't?

[bigruss]

I'll find a way, why should I have to get taxed if the big dogs don't?

The game doesn't work that way unfortunately but godspeed sir!

[pettie4sox]

The game doesn't work that way unfortunately but godspeed sir!

 

Time to be the one that breaks the glass ceiling then. =)

[bmags]

Seriously though, it seems these are better regulated but a kid from my high school lost reported hundreds of thousands when one of the online poker scams closed shop. You never know how well they are keeping your money.

[pettie4sox]

Seriously though, it seems these are better regulated but a kid from my high school lost reported hundreds of thousands when one of the online poker scams closed shop. You never know how well they are keeping your money.

 

I remember those poker scams you are referring to. GWB signed legislation that ruined the industry which was ridiculous. It paved the way for subpar poker sites to run amok to lure desperate Americans in and then pretty much pulled the rug from underneath them.

 

I use the SBR when deciding on what sports book to invest in. I have multiple accounts to spread my money out and it also allows me to shop for better betting lines.

[southsider2k5]

Necrobump to some extent.

 

I started a new job recently and I am taking advantage of the match to the full.

 

I have saved some money via retirement accounts in the past but I'm not nearly where I need to be. This is probably a vague question but when do you need to start saving more money in your retirement account to make sure you're OK when the time comes?

 

ASAP. A great rule of thumb is the rule of 72 for how often your account should double itself. The earlier you start, the less you miss the money you are socking away. Do it early so you never build a dependence on it.

 

As a general rule you should ALWAYS take advantage of any retirement plus up to at least what they are willing to match. If you aren't it is like leaving free money on the table. If they are willing to give it to you, take it.

 

When it comes to most 401k programs, I would almost always have the lions share of your funds in the broadest and simplest SP fund. They are going to have the lowest fees by far, and while they might not win a particular year, they will win in the long term. Trust me on that one. As you age, you should also be putting more and more of your funds in conservative style investing such as dividend and bond based funds. If you ever want to talk specifics, let me know. I have worked in this industry for 20 years and will point you away from the BS and where you need to go.

[pettie4sox]

ASAP. A great rule of thumb is the rule of 72 for how often your account should double itself. The earlier you start, the less you miss the money you are socking away. Do it early so you never build a dependence on it.

 

As a general rule you should ALWAYS take advantage of any retirement plus up to at least what they are willing to match. If you aren't it is like leaving free money on the table. If they are willing to give it to you, take it.

 

When it comes to most 401k programs, I would almost always have the lions share of your funds in the broadest and simplest SP fund. They are going to have the lowest fees by far, and while they might not win a particular year, they will win in the long term. Trust me on that one. As you age, you should also be putting more and more of your funds in conservative style investing such as dividend and bond based funds. If you ever want to talk specifics, let me know. I have worked in this industry for 20 years and will point you away from the BS and where you need to go.

 

I will absolutely keep you posted. Right now, I have them in a standard what year do you plan to retire fund.

[ptatc]

I will absolutely keep you posted. Right now, I have them in a standard what year do you plan to retire fund.

This is what I do. Is this a smart way for those of us who don't know much about the different funds?

[Marky Mark]

This is what I do. Is this a smart way for those of us who don't know much about the different funds?

 

 

On the whole, yes. Pumping as much money as you can into your 401k or other tax advantaged accounts is always going to be the key and should be your main focus. Push yourself and find ways to put in more than you thought possible, and that's going to be key in the long term.

 

Otherwise, regarding the retirement age funds, the closer you get to retirement the more the funds increases your % of holdings in bonds and cash and reduce in stocks to be safer. That's a good way to go if you aren't familiar or comfortable with different funds. Personally I think they're usually more conservative than I prefer, but I am also more comfortable with short term risk than most people.

 

The only reason I would advise against it would be due to the expense ratio. When I look at my 401k options, my retirement age-based options have an expense ratio of .7%. For me, that's way too high, so I have 100% of my 401k going into an S&P500 index fund that has a .04% expense ratio.

 

Why does this matter? In the short term, you wouldn't notice much, but the longer term makes a difference.

 

If I put $18,500 into my 401k a year for the next 20 years and I'm getting 7% interest each year for both options, than I will have over $52,000 more if I use the option with the .04% expense ratio. Over 30 years, I will have $192,000 more with the .04% expense ratio.

 

 

[Marky Mark]

The earlier the better thanks to compounding interest.

 

"If you can" is a pretty good and short intro guide on retirement investing. https://www.etf.com/docs/IfYouCan.pdf

 

General guidelines I've seen and follow are:

 

--Save in your 401k up to your employer's match. If they match the first 5%, put in that much. It's free money.

--Beyond the employer match, put your next chunk of retirement savings into an IRA or Roth IRA. Which makes more sense for you depends on your current income levels (both phase out as income goes up) and your current and expected retirement tax brackets. The reason to go with your own IRA over your work's 401k is you can choose someone like Vanguard or Fidelity (and I think Schwab) who offer very-low-cost funds whereas you're going to be pretty limited in your options in your 401k.

--Once you've maxed your IRA contribution limits ($5.5k/year right now), increase your 401k savings. That caps out at 18% of your income a year.

 

If you max your 401k and your IRA space, congrats, go see a real financial professional because you've got a good problem on your hands.

 

 

This is critical for another big reason too. With a Roth IRA, you can always pull out your principal that you've put into the account without any tax or penalty for doing so. So if you put $5,500 in each year for 10 years and get 7% interest, you'll have $76,000. If you have some huge financial emergency or retire early, you can take out the $55,000 you put into the account without having to pay taxes or penalties.

[Chisoxfn]

This is what I do. Is this a smart way for those of us who don't know much about the different funds?

For most people, this is by far the best approach (sitting in this type of fund).

[Chisoxfn]

On the whole, yes. Pumping as much money as you can into your 401k or other tax advantaged accounts is always going to be the key and should be your main focus. Push yourself and find ways to put in more than you thought possible, and that's going to be key in the long term.

 

Otherwise, regarding the retirement age funds, the closer you get to retirement the more the funds increases your % of holdings in bonds and cash and reduce in stocks to be safer. That's a good way to go if you aren't familiar or comfortable with different funds. Personally I think they're usually more conservative than I prefer, but I am also more comfortable with short term risk than most people.

 

The only reason I would advise against it would be due to the expense ratio. When I look at my 401k options, my retirement age-based options have an expense ratio of .7%. For me, that's way too high, so I have 100% of my 401k going into an S&P500 index fund that has a .04% expense ratio.

 

Why does this matter? In the short term, you wouldn't notice much, but the longer term makes a difference.

 

If I put $18,500 into my 401k a year for the next 20 years and I'm getting 7% interest each year for both options, than I will have over $52,000 more if I use the option with the .04% expense ratio. Over 30 years, I will have $192,000 more with the .04% expense ratio.

Depends on your 401K options but there are some really low cost age based funds these days.

[Heads22]

I've started doing this too. Before my dad passed he got me started on Vanguard's target funds. In about two years I become vested in the IPERS plan here in the state but I have also been contributing monthly to the Target 2050 from Vanguard. Hopefully I get to enjoy more than the five months of retirement that he did.

[ptatc]

I've started doing this too. Before my dad passed he got me started on Vanguard's target funds. In about two years I become vested in the IPERS plan here in the state but I have also been contributing monthly to the Target 2050 from Vanguard. Hopefully I get to enjoy more than the five months of retirement that he did.

I do the same except for Illinois state employees they'll do a deferred income into the Vanguard type fund. Ours is T Rowe Price I believe. I'm old though. I'm in the 2025.

[Dam8610]

This seems like a good place to ask this question. Is there a reason that high dividend yield securities aren't used as part of aggressive growth strategies? Especially when the security is something like a REIT interest where the asset portfolio is less risky and the primary reason for high yields is legal avoidance of tax (REITs have to distribute 90%+ of their profits to shareholders to avoid the profits being taxed at the trust level)? Because I feel like if I'm getting a 15-20% dividend yield, I really don't care what happens to the value of the stock short of it tanking completely.