Investing for retirement 101 Help

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andrehzg
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Joined: Wed Aug 10, 2016 10:10 am

Investing for retirement 101 Help

Post by andrehzg » Wed Aug 10, 2016 10:17 am

Hi,

I'm new in th US and I'm constantly hearing from people I should invest for retirement and savings because the bank doesn't pay enough money and actually you can lose money by having it in a regular saving account.

I have $20K, i would love you to help me find the better way to invest and save. I have no knowledge of stocks market at all. And as i'm new in the US i have no idea of what can be done with the money instead of having it in a saving acoount.

Thank you so much,

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Peter Foley
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Re: Investing for retirement 101 Help

Post by Peter Foley » Wed Aug 10, 2016 11:31 pm

Some money should be in a bank savings account. This essentially serves as an emergency fund. Six months of income is often recommended. Once you have that in hand you could invest in the overall stock market. Vanguard is one of the lowest cost companies to use, but Fidelity and Schwab also have a number of low cost broad based index funds.

At its most basic (101) level, the approach to take is to invest in a broad based, low cost index fund on a regular basis. This is called dollar cost averaging. Do not try to pick winners based on past performance, and do not try to time the stock market. Do not pay fees to buy mutual funds.

After you have a fair amount of money in a stock mutual fund (half year's salary) diversify by adding a bond fund to the mix. Again, a broad based, low cost bond fund such as Vanguard Total Bond Market is a solid recommendation.

RadAudit
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Re: Investing for retirement 101 Help

Post by RadAudit » Thu Aug 11, 2016 6:11 am

Welcome to the forum.

Mr. Foley offered very sound advice.

There are other options for your retirement investments, depending on how much you want to be involved with them.

For background you might want to start here. https://www.bogleheads.org/wiki/Getting_started

If you are relatively young, in your 20's, you might want to consider a (Vanguard) Target Date Retirement Fund. Pick the date you'd like to retire and choose the appropriately dated fund. Those funds have excellent diversification, they are automatically rebalanced, high allocation to equities in the early years, and they have a glidepath of an increasing bond allocation as you approach your retirement date.
FI is the best revenge. LBYM. Invest the rest. Stay the course. - PS: The Calvary isn't coming, kids. You are on your own.

investor1
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Re: Investing for retirement 101 Help

Post by investor1 » Thu Aug 11, 2016 6:31 am

Do you plan on remaining in the US after you retire?

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Watty
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Re: Investing for retirement 101 Help

Post by Watty » Thu Aug 11, 2016 8:34 am

The Bogleheads Guide to Investing book is also a good place to start. You local library may have a copy of it.

https://www.amazon.com/s/?search-alias= ... Bogleheads

In addition to investing and savings it is also critical to not get into debt with credit cards and large car loans so be very careful with those.

mhalley
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Joined: Tue Nov 20, 2007 6:02 am

Re: Investing for retirement 101 Help

Post by mhalley » Thu Aug 11, 2016 7:28 pm

You might try this pdf also
https://www.etf.com/docs/IfYouCan.pdf

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