how do you invest?

[anoop]

I thought I'd ask folks how they invest over here since I'm more likely to get a broad spectrum of responses than if I were to ask in an investing focused forum.

I am nearly 100% in money market/treasuries/savings/CDs. I feel like I have lost out on the run up of the last several years and since there's no telling whether or not it will continue, I'm wondering if I should get in now--maybe a small % of assets. I am 46.

I would like to know how you invest. If you are willing to share your age, that would be helpful too. Some questions to get the discussion started:

What do you invest in? (stocks, index funds, bonds, CDs, gold, silver, etc.)
Do you get professional advice?
Do you subscribe to any newsletters?

 

[Kentos]

I am the same age as you, and the majority of my measly investments are in ETFs and Stocks. My investment window is still pretty large so they are all in moderately aggressive categories, meaning quite a bit of volatility. I also contributed regularly to a ROTH as well. My portfolio went belly up in the last sell-off but has since taken off tremendously recently as you alluded to. In the last 12 years despite dipping into it frequently for emergency money my investments have more than doubled.

You should go see a reputable "wealth planner" to see what options are open to you. Mine is with a local FCU so rates are lower.

 

[anoop]

You should go see a reputable "wealth planner" to see what options are open to you. Mine is with a local FCU so rates are lower.

What would the wealth planner do? Would they just help pick an asset allocation or something more?

 

[Billski]

My money is with an Investment Counsel. I believe the 2nd word is correct.

 

[Kentos]

What would the wealth planner do? Would they just help pick an asset allocation or something more?

I don't know what others have experienced, but for me I believe they should take into account how long you have until retirement, what your risk tolerance is, what kinds of investments interest you, and in my case, try to lessen the tax burden your gains may have. Of course an accountant would know more, but at least tax exposure should be taken into account.
They may also give you advice on how much you need to save to get to a certain investment goal etc. and explain their opinions on the markets and what they see happening in the future. After all you will be paying them a percentage of the money they are managing for you.
In the end no one has a crystal ball and can know what will make or lose money, but in my case I think my investments are diverse
enough to lessen my exposure.

 

[DC_MPA]

I'm into stocks on retirement funds, gold and silver and relics/rarities on my spare cash.

 

[doofus]

A little younger than you about 50% of my money professionally managed mostly mutual funds and about 50% managed by me in stocks. But like above what you do should be based on your risk tolerance.

 

[Alacrity59]

Balance is important. I dislike gold, silver, and other things (oil/energy) that are very speculative in nature. I believe in investing based on fundamentals. I like stocks that have a history of paying dividends so that some of your return is pretty certain. I like what the folks at fool.com say and subscribe to their service. I'm 57.

 

[BSAGuy]

Diversification is the key word. +/- 90% of a portfolio's performance is attributable to the overall asset allocation and not specific securities.

Most people and even financial publications focus solely on return whereas, as a credentialed financial planner, I focus more on risk management.

Most of the forces that affect your financial success are beyond your control. You can't control any of: market performance, inflation, tax policy, unexpected expenses, death or disability.

I encourage my clients to control what they can, which is their savings rate. If you save 15-20% of your gross income, you will succeed.

I have an ax to grind because this is how I make my living, but I think that everyone needs professional advice.

One's money is too important to handle it all by yourself.

Would you do your own surgery? Make your own car? Grow all your own food? Build your own house?

 

[Highspeedlane]

Mid 50's and I use Thrift Savings. This is program that taxes your annuity upon withdrawal. It offers a multitude of different investment options and is essentially self-managed. Not sure whether it's good/bad/indifferent compared to something like a Roth but it's what I'm going to be working with after I hang up my boots.

 

[smudge]

Low UK interest rates over the last decade, so I have approx 80% in real assets (stocks/shares) and the rest in money based products (government bonds, premium, index linked, cash etc) I've used Fidelity for the asset backed investments and always found them to be excellent over a 25 year period. Not forgetting of course to utilise tax free ISA allowances.

 

[musicman1951]

I'm 65 and retired. I started saving when I was in my 20's and have gone through a few poor strategies. What works great for me is about 80% invested in a balanced portfolio of stocks and bonds - all indexed funds (no individual stocks and nothing that is remotely expensive). Frankly, if my wife were not so keen on money in the bank I'd probably go 90% invested.

I've had a few financial planners and Vanguard (where all my investments are) also provides advice. I think you're question about the market is understandable, but misplaced. The market goes up and down. That's what it does. If you're talking about having money when you're 76 and hopefully 86 you need a long term strategy for your investments. It goes up and down. Balanced portfolio to ride out the downs and good investment in your future. IMHO your current investment in the future is very poor - get some money invested. Monthly through direct deposit from your checking account is probably best, although you can still put a lump in a Roth IRA for last year.

 

[Alex_Kinzor]

Well I don't really trust the stock market, lost a lot of my retirement in 08 through my 401k. As it stands I have the 401k through work, which I roll over when I change jobs which happens periodically. Other than that I save in other ways--mainly through storing commodities directly.

As such I have some silver ingots, a stash of copper pennies (pre-1982, after that they switched to copper plated zinc) and nickles (they are cupronickle), weapons, ammunition, and of course long term storage foods. My view is that if only exists on a computer screen somewhere or on a spread sheet it can be vaporized in a few key strokes so I'd rather have physical objects. Also you never know when the zombie apocalypse will happen.

I'm 37 in case of anyone is interested and otherwise my retirement plan is to die on the job. Retirement is likely to kill me much like it did my grandparents.

 

[StillShaving]

I thought I'd ask folks how they invest over here since I'm more likely to get a broad spectrum of responses than if I were to ask in an investing focused forum.

I am nearly 100% in money market/treasuries/savings/CDs. I feel like I have lost out on the run up of the last several years and since there's no telling whether or not it will continue, I'm wondering if I should get in now--maybe a small % of assets. I am 46.

I would like to know how you invest. If you are willing to share your age, that would be helpful too. Some questions to get the discussion started:

What do you invest in? (stocks, index funds, bonds, CDs, gold, silver, etc.)
Do you get professional advice?
Do you subscribe to any newsletters?

I do not get personal advice, but I have read a lot and continue to do so. Morningstar, SeekingAlpha, MrMoneyMustache, Bogleheads.org, are some good sites among many. There are also lots of personal blogs were people talk about their approach to savings, budgeting, retirement, etc. If you enjoy a more doom&gloom outlook and/or if your political views align then ZeroHedge is a combination of informative/depressing/humorous.

There are a lot of trite sayings but I think a lot of them have value like: "Nobody is going to care about your money more than you". Meaning everyone should learn enough about budgeting, saving, investing, etc, as no one else can do it for you. I believe that professional advice can be helpful but I think it is more helpful to guide overall big picture planning and not to give you specific stock tip or mutual fund advice. If you have a bucket of money (small or large) to invest and not sure which way to go on your own, then buy low cost broad indexes.

"This time is no different" but I think I have heard more pundits than ever say that this the most difficult investing climate they have seen in their careers. I tend to think they are right in that Bonds are near historical lows so they pay very little interest relative to the risk of higher rates. So buying a Bond fund does not look as attractive as it has in the past few decades. Or if you do buy Bonds stick with short terms and accept low returns, as they are still better than cash & CDs. Stocks are richly valued unless you factor in relative value as compared to interest rates. Add in the political polarization/uncertainty and it is difficult. The Dow just notched its 12th record high closing in a row...do you ride that momentum forward or look for a way in after the potential pullback.

IMO it is a bad idea to be heavily weighted into cash, but if you have most of your savings in CDs then I think one should take the dollar cost average approach to buying/investing, to more slowly get in over time. This will not maximize your gains if the market continues up, but it helps avoid a bigger loss assuming there is a spike in interest rates, political confusion over tax rates, etc.

 

[Rushman2112]

Usually check the form guide in the Sporting Life: if the trainer and jockey combo is a good one too, then it's worth a punt.

 

[RealPretendPsychic]

I am in my late 20's and have most of my investments in blended mutual funds with a nice mix of domestic and international, large and medium cap, small cap and emerging markets and bond funds. The 401k sits in a target date fund and the rest is mainly in large cap stocks. I work with an advisor whose full-time job it is to understand this stuff, and have mostly phased out speculative plays. I do still have a weakness for biopharm, energy, commodities and fx.

 

[musicman1951]

Well I don't really trust the stock market, lost a lot of my retirement in 08 through my 401k.

Yes, it can be a little too exciting when it dips. But it's up 220% since 09, so as long as you left your money there you should be good.

 

[Alex_Kinzor]

Yes, it can be a little too exciting when it dips. But it's up 220% since 09, so as long as you left your money there you should be good.

I've been sitting on it. I don't trust it though. I'm kinda of the same school that my grandfather was--if you're gonna play the stock market might as well go to Vagas. Got the about the same odds of coming out ahead and you can have fun.

 

[anoop]

Thanks for the replies so far. I see I am an outlier being nearly all cash/bonds with my investments.

 

[Prof. Moriarty]