Thanks for the advice. Please lock mods.

[Walleye]

... well, here, in 3 years, houses have gone up 350%. so, i guess our buying this home was a good investment

 

[Mill]

Originally posted by: Heifetz

Originally posted by: Millennium

Originally posted by: dquan97
How long in the future would you need it?

I will not actually be investing for another 4 years and 9 months, but I am seeking opinions now. I do not want to make stupid decisions or get myself into a tax problem.

Why such a specific amount of time?

Anyways, anytime is a good time to invest in the stock market, given that you won't need the money anytime soon, and you're willing to diversify. You might want to look into accumulating blue chip stocks, stocks with historical stable increase in earnings from 5 - 10%. You might also want to look into high dividend stocks, especially in light of the possible end of taxation on dividends. There are many stocks out there that have very high, >10 % dividend yields. You should also invest yearly into tax saving investments, such as roth IRAs...I'm not too familiar with those though.



Heifetz

Quick question. Is it possible for the high dividend stocks to go down in price per share and the dividends with it? How exactly does a roth IRA work?

 

[Steve819]

Quick question. Is it possible for the high dividend stocks to go down in price per share and the dividends with it? How exactly does a roth IRA work?

First off, I would get a certified financial planner to help you manage your money effectively. Interview several candidates, and choose the one who makes the most sense. Fees should be fairly minimal - try to avoid a fee plan that charges 1% of your assets every year. It only damages your returns. Pay for services on as needed basis.

Do your own homework and avoid mutual funds with over 1% fees - look at Longleaf Partners Fund, Clipper, Vanguard, Third Avenue Growth, Mairs and Power Growth, and Dodge and Cox Stock Funds. All of those funds have long term track records of beating the indexes. Stick to index funds and carefully selected mutual funds, equities, and bonds. Your planner should be able to advise what bonds and how to effectively diversify your portfolio among small caps, mid cap and large caps.

Secondly, it is possible for a dividend to decrease with the stock price if the company cuts the dividend payout. Otherwise, the stock price will go down, and the dividend will remain the same - thusly increasing your yield. However, you should always research why a stock has decreased substantially - sometimes it is because the market feels the company does not have the cash to support paying a dividend.

A Roth IRA is a tax-free account. You are allowed to place I think up to $2000 a year in the account and allocate it anyway you please. It is basically a retirement account that allows you to avoid paying taxes on that money until after you retire.

Thirdly - get a subscription to the Motley Fool and start reading. Also get a subscription to the Wall Street Journal and read that every day. That should give you a good business education and allow you to keep up with Wall St. and how to manage your money.

Congrats and Good Luck!


Edit: It sounds like you are recieving a trust fund of some sort - I would recommend talking to a tax accountant about the tax implications in addition to a financial planner.

 

[Ameesh]

i would talk to a financial planner, they will be able to help you wayy more then anybody who posted in this thread. Take to a few and see who you like. When you goto them tell them you only have 30-40k to invest and see how they treat you, if they seem good about 30-40k and you feel comfortable with them tell them you actually have 10x that.

 

[Mill]

Originally posted by: Steve819

Quick question. Is it possible for the high dividend stocks to go down in price per share and the dividends with it? How exactly does a roth IRA work?

First off, I would get a certified financial planner to help you manage your money effectively. Interview several candidates, and choose the one who makes the most sense. Fees should be fairly minimal - try to avoid a fee plan that charges 1% of your assets every year. It only damages your returns. Pay for services on as needed basis.

Do your own homework and avoid mutual funds with over 1% fees - look at Longleaf Partners Fund, Clipper, Vanguard, Third Avenue Growth, Mairs and Power Growth, and Dodge and Cox Stock Funds. All of those funds have long term track records of beating the indexes. Stick to index funds and carefully selected mutual funds, equities, and bonds. Your planner should be able to advise what bonds and how to effectively diversify your portfolio among small caps, mid cap and large caps.

Secondly, it is possible for a dividend to decrease with the stock price if the company cuts the dividend payout. Otherwise, the stock price will go down, and the dividend will remain the same - thusly increasing your yield. However, you should always research why a stock has decreased substantially - sometimes it is because the market feels the company does not have the cash to support paying a dividend.

A Roth IRA is a tax-free account. You are allowed to place I think up to $2000 a year in the account and allocate it anyway you please. It is basically a retirement account that allows you to avoid paying taxes on that money until after you retire.

Thirdly - get a subscription to the Motley Fool and start reading. Also get a subscription to the Wall Street Journal and read that every day. That should give you a good business education and allow you to keep up with Wall St. and how to manage your money.

Congrats and Good Luck!


Edit: It sounds like you are recieving a trust fund of some sort - I would recommend talking to a tax accountant about the tax implications in addition to a financial planner.

Just got a 30 day free trial there. I am looking at their boards and info now. Thanks for the great info. You may have a PM coming your way soon.

 

[Phuz]

Originally posted by: Ameesh
i would talk to a financial planner, they will be able to help you wayy more then anybody who posted in this thread. Take to a few and see who you like. When you goto them tell them you only have 30-40k to invest and see how they treat you, if they seem good about 30-40k and you feel comfortable with them tell them you actually have 10x that.

Very good idea.

 

[olds]

Originally posted by: Phuz

Originally posted by: Ameesh
i would talk to a financial planner, they will be able to help you wayy more then anybody who posted in this thread. Take to a few and see who you like. When you goto them tell them you only have 30-40k to invest and see how they treat you, if they seem good about 30-40k and you feel comfortable with them tell them you actually have 10x that.

Very good idea.

I agree. It's always a good idea to come across as as putz and a liar.

 

[Mill]

Originally posted by: oldsmoboat

Originally posted by: Phuz

Originally posted by: Ameesh
i would talk to a financial planner, they will be able to help you wayy more then anybody who posted in this thread. Take to a few and see who you like. When you goto them tell them you only have 30-40k to invest and see how they treat you, if they seem good about 30-40k and you feel comfortable with them tell them you actually have 10x that.

Very good idea.

I agree. It's always a good idea to come across as as putz and a liar.

WTF is your problem?

 

[olds]

Originally posted by: Millennium
WTF is your problem?

You've got to be kidding me?

 

[Mill]

Originally posted by: oldsmoboat

Originally posted by: Millennium
WTF is your problem?

You've got to be kidding me?

No I am not. First of all you starting talking about traps. WTH? A bear trap or something? Then you said their idea was not a good one. How is it lying to say you have 40k you want to invest? You do have 40k and depending on how you are treated, you might invest more. ???

 

[Ferocious]

Real estate is almost always sound advice.

That's how I'm building my wealth.

 

[olds]

Originally posted by: Millennium
No I am not. First of all you starting talking about traps. WTH? A bear trap or something? Then you said their idea was not a good one. How is it lying to say you have 40k you want to invest? You do have 40k and depending on how you are treated, you might invest more. ???

It is my opinion that going to a professional who is used to dealing with money and lying to them is not a good idea. It's not like 350K is a lot of money and they have never dealt with it before. How would you feel if someone came to you (in your professional capacity, whatever that is) asking your advise and lied to you or attempted to mislead you? I wouldn't feel that it was the start of a very good relationship. Which is something I would want with someone who is handling my money. Of course that is just my opinion.

 

[Spooner]

dude, how old are you?

since when do you have 325k? :Q

 

[dquan97]

I wouldn't recommend going with real estate with that time frame. Too much risk for your short-term investment. Have you thought about Municipal or gov't quality bond funds? Good thing about this is that capital gains may be tax-free!

 

[Mill]

Originally posted by: dquan97
I wouldn't recommend going with real estate with that time frame. Too much risk for your short-term investment. Have you thought about Municipal or gov't quality bond funds? Good thing about this is that capital gains may be tax-free!

I am hearing a lot about the Municipal bonds and gov bonds. Going to look into all of this and I just wanted some opinion on where to get started. Maybe I should invest it in steak? I see that you put 40oz away easily.

 

[olds]

Originally posted by: Millennium

Originally posted by: dquan97
I wouldn't recommend going with real estate with that time frame. Too much risk for your short-term investment. Have you thought about Municipal or gov't quality bond funds? Good thing about this is that capital gains may be tax-free!

I am hearing a lot about the Municipal bonds and gov bonds. Going to look into all of this and I just wanted some opinion on where to get started. Maybe I should invest it in steak? I see that you put 40oz away easily.

Steak is an excellent investment. I like a good rib-eye with straight horseradish, garlic mashed potatoes and red wine.

 

[ed21x]

buy some apartment next to a college campus and rent them out for some rediculously high price. It's the gift that keeps on giving =\

 

[DaveSimmons]

A personal financial planner is not a bad idea, but you want one that is paid only consultation fees, not an annual percent of assest and defintely not one who does your stock / fund trades for you (and earns comissions for "churning" your holdings).

For a brokerage that offers stocks, funds and flat-fee financial advice I'd recommend www.schwab.com since you'll have more than the 50K needed to avoid account maintenance fees. If you plan to put a lot of money into Vanguard's top-rated mutual funds it might be worth setting up an account directly with them instead or in addition.

Don't make plans on how to divide your assets based on the current markets -- real estate is hot right now but it's at least partly a bubble from low mortage rates and people fleeing stocks. That bubble will burst, then people will flee back into stocks. Same to a certain extent with bond funds, which are now overpriced from too much money placed into them.

It's hard to tine it, but I suspect in 4 years you'll have missed the best time to buy stock funds this decade -- Warren Buffet and some other experts think stocks will fall a bit more, but then they'll bottom out. Once they start heading up, and after a lot of easy profit has been missed, the average investors will dump their bond funds and get back into buying stocks.

 

[udonoogen]

Originally posted by: ed21x
buy some apartment next to a college campus and rent them out for some rediculously high price. It's the gift that keeps on giving =\

my landlord makes $72 grand off of our house every year. sick isnt it.

 

[tcsenter]

Dude, if I had $325,000 cash to work with, I would double it every two years.

Know anything about carpentry and/or home construction?

Buy a little property, subdivide it, hire all the subcontractors yourself, have subcontractors do the foundation, rough framing, roof, facing, wiring, plumbing, insulation, etc., then do the finish work yourself, the interior, paint the walls, hang some cabinets, do the counter tops, lay the floors, stuff like that.

You could easily build several homes for around $70 per square foot and sell them for $90 per square foot.

Do the math: 90 - 70 = $20

1700sq. ft. x $20 = $34,000 per house

That was a quick and dirty estimate, but its actually a little conservative. Need a partner??