anyone familiar with retirement/investment accounts?

[anj46907 10+ year member]

im looking to do some type of investment account for retirement. im 24 now and think its definetly time to start saving for retirement, but i dont know sh*t about it. ive looked into places like etrade/scottrade for ira roth accounts but again, have no idea what im doing. i dont get any employer benefits like 401k because im considered a contractor and not a full time employee, so i dont get the company benefits. when it comes to health insurance and 401k's im on my own so im trying to figure out the best way to do this. any help or ideas?

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[Louisiana_CRX 5,000+ posts]

GM stocks are cheap right now ...they will come back once tthey bring back the Camaro...if you've noticed their stocks continued to fall once they did away with the Camaro...that was a bad business move doing away with their most popular car....

 

[Bigrick31 10+ year member]

Depends on what you want and how much risk you want to take. I have an account that is handled by a division of Fidelity and they basically invest my money into stocks and bonds. The idea behind this is that when one goes down the other goes up like a scale. With regards to the recent economic situation i have lost some money but its not as bad as what a lot of other people have lost. Ive only lost 4% this year. So there is that rout where you basicly hand your money over to someone and have them invest it for the long haul. The 4% loss is nothing to the 13% gains I had been receiving when times were good. Im not an expert and a lot of this investment and 401K business is still foreign to me but you should be able to open your own 401k account and basically you tell them how much money you want in it by the time you are 55 or 60 or whenever you plan on retiring and they tell you how much a month you need to put into that account. Just make sure to ask any questions that you have when dealing with a company that will either invest or set up a 401K account for you make sure you know what penalties you may face if you need to take your money out early and if you even can take it out early. With my account I can access my money any time I want but there are a lot of taxs and penalties i have to pay for doing so. Hope this helps and best advice i can give is shop around and check portfolios but first decide do i want to take a risk and possibly end up with more money or consequently less money by retirement or do i want the steady less risk lower yield type of account.

 

[michaellane 5,000+ posts]

go to your bank or shop around for the best % rate but open a roth IRA....they are pretty much just like 401k's...or go to someone who will watch and invest your money for you. they normaly get a small % of the interest you make but that helps keep them on their toes and always makes sure your money is making money.

 

[svarasnj 10+ year member]

I'd go with roth IRA. When you have roth IRA its not deductible on your taxes but there are no taxes when you start taking it out @ 65+.

Talk to investment manager at your local bank and see if they have retirement accounts. If not just go to either scottrade or etrade and open an account online.

I'd call one of the companies and talk to financial adviser. They 'll give you some questions, like your financial goals, net worth, savings, etc and will suggest you some fund to invest .

Pretty simple. I did it last year and took maybe 40 min over the phone.

The biggest problem my sh1t is down like 35%. Oh well lets hope for the best

 

[anj46907 10+ year member]

thanks guys all 3 of those answers helped alot. i have a buisness accountant/advisor so im going to see what he advises as well, but i need alot more input then just his.

 

[Flipx99 5,000+ posts]

Are you considered self-employed?

If so, there is a form of 401(k) available for you.

Also, a Roth may or may not be right for you. It depends on your tax situation now vs. your retirement. Furthermore, depending on your income, you may not even be able to qualify for all types of retirement accounts.

 

[Flipx99 5,000+ posts]

Depends on what you want and how much risk you want to take. I have an account that is handled by a division of Fidelity and they basically invest my money into stocks and bonds. The idea behind this is that when one goes down the other goes up like a scale. With regards to the recent economic situation i have lost some money but its not as bad as what a lot of other people have lost. Ive only lost 4% this year. So there is that rout where you basicly hand your money over to someone and have them invest it for the long haul. The 4% loss is nothing to the 13% gains I had been receiving when times were good. Im not an expert and a lot of this investment and 401K business is still foreign to me but you should be able to open your own 401k account and basically you tell them how much money you want in it by the time you are 55 or 60 or whenever you plan on retiring and they tell you how much a month you need to put into that account. Just make sure to ask any questions that you have when dealing with a company that will either invest or set up a 401K account for you make sure you know what penalties you may face if you need to take your money out early and if you even can take it out early. With my account I can access my money any time I want but there are a lot of taxs and penalties i have to pay for doing so. Hope this helps and best advice i can give is shop around and check portfolios but first decide do i want to take a risk and possibly end up with more money or consequently less money by retirement or do i want the steady less risk lower yield type of account.

LOL....whatcha gonna do when correlation equals one. Great Laugh!

 

[Bigrick31 10+ year member]

LOL....whatcha gonna do when correlation equals one. Great Laugh!

Har har har. So far its been like someone took the arms of the scale and bent them down about 9% but its still less than loosing 30+%

 

[Flipx99 5,000+ posts]

Har har har. So far its been like someone took the arms of the scale and bent them down about 9% but its still less than loosing 30+%

I wasn't commenting on your losses as much as I was the ubiquitous advice that stocks and bonds are uncorrelated.

 

[Bigrick31 10+ year member]

I wasn't commenting on your losses as much as I was the ubiquitous advice that stocks and bonds are uncorrelated.

I know you wernt talking about my losses. There is a direct correlation between stocks and bonds and i odnt think my post stated that they are uncorrelated at least that wasnt what i entended. Heres an example of what i meant. (note im not taking credit for writing this but it reflects what i was trying to say in my previous post)

Bonds are issued with a stated interest rate, say 8%. and do not change over the life of the bond. That means they pay $80 of interest annually no matter what.

If the general interest rates RISE in the market, then some other company will have to offer 9% bonds to attract investors. These new investors are going to get $90 annually in interest. In order for your 8% bonds to be attractive to another investor they will want to pay less for it. i.e. your bond has gone down in value to $889 ($80 / 9%) from the $1,000 you paid for it.

Of course if interest rates move down, then the opposite is true. People will be willing to pay more than $1,000 to get $80 of interest. They will be willing to pay $1,142 for your $1,000 bond if rates drop to 7% ( $80 / 7%). Your bond went up in value as interest rates went down.

Stocks are just the opposite b/c the changing interest rate reflects how expensive it is for a company to borrow money to grow or expand. If it costs a company less(lower interest rates) to borrow money, then they become more profitable and consequently their stock price goes up.

so you see if you have investments in stocks and bonds when you gain money on one end you loose it on the other. So far the gain on one end has outweighed the loss on the other and historically our retirement plan has gained an average of 13% annually by investing in stocks and bonds

 

[mcsoul 10+ year member]

Right now, it's the mattress or the freezer, cash is king.

Just before the recovery Flip will tell us when to jump back

into the market. Right Flip??? Alright maybe not.

 

[GearGuy2001 10+ year member]

I was reading through a suze orman book and she said if you start investing at 25, $300 a month until your 40. Which would add up to $54000 at an average gain of 8% (I Know right lol) you would retire at 59 1/2 with 1 Million and some change.

If you waited till your 40 and invested $700 a month till your 59 1/2 youd only retire with $440k or so.

If you want the exact numbers Ill look em up but thats pretty much what I remember.

Since you were asking where to invest, well 8% out of anything right now is a long shot but maybe you can find a good money market or buy some CDs

 

[Bigrick31 10+ year member]

I was watching good morning America and they had a report on there saying that 43% of retired Americans at the age of 55 only have about $53000 saved fore retirement. If yu want to retire and live as you do right now you need to invest 25 times your monthly income. So if you make say $1000 a month you need to invest a total of $25000 of coarse i take it that is investing in safer things than the stock market

 

[BassMechanix 10+ year member]

GM stocks are cheap right now ...they will come back once tthey bring back the Camaro...if you've noticed their stocks continued to fall once they did away with the Camaro...that was a bad business move doing away with their most popular car....

Seriously???? Yeah............. GM is going under because they stopped selling the camaro. You should work on wallstreet dude!