25 year old - Investing for Tomorrow Tips

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BlancoJordan
Posts: 3
Joined: Sat Dec 10, 2016 6:35 pm

25 year old - Investing for Tomorrow Tips

Post by BlancoJordan »

Age: 25
Status: Single
Debt: $7,700.00 car loan at 0% interest
Cash: $100,000.00
401K: Max out plus 30% contribution match from employer. 401K position allocation: 25% DDFIX, 25% FBGRX , 25% FUSVX, 25% JTSSX
Investment Account: Stocks and mutual funds - $22,000.00

New to the game, and want to make sure we are allocating properly. Would you invest money into ETF's or Index Funds, or keep working the stock market? If so, what are some good one to choose from?

Any tips or insight is greatly appreciated!
PFInterest
Posts: 2684
Joined: Sun Jan 08, 2017 12:25 pm

Re: 25 year old - Investing for Tomorrow Tips

Post by PFInterest »

ETFs can be index fund and vice versa. so start with the wiki!
the wiki really helped me out. read the whole thing. the first step is figure out a general plan, then you can decide what to keep/scrap/adjust.
ff4930
Posts: 114
Joined: Fri Dec 30, 2016 3:33 pm

Re: 25 year old - Investing for Tomorrow Tips

Post by ff4930 »

What is your tax bracket? I would recommend opening a Roth-IRA. ETF's and index funds are very similar but have their differences. I would search Bogleheads for threads describing each. There is a bunch. Personally I like index funds over ETF's because I can contribute any amount vs ETF's is on share prices.
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ruralavalon
Posts: 19733
Joined: Sat Feb 02, 2008 10:29 am
Location: Illinois

Re: 25 year old - Investing for Tomorrow Tips

Post by ruralavalon »

BlancoJordan wrote:Age: 25
Status: Single
Debt: $7,700.00 car loan at 0% interest
Cash: $100,000.00
401K: Max out plus 30% contribution match from employer. 401K position allocation: 25% DDFIX, 25% FBGRX , 25% FUSVX, 25% JTSSX
Investment Account: Stocks and mutual funds - $22,000.00

New to the game, and want to make sure we are allocating properly. Would you invest money into ETF's or Index Funds, or keep working the stock market? If so, what are some good one to choose from?

Any tips or insight is greatly appreciated!
I would buy index mutual funds, rather than stocks or ETFs. I would look for index funds which are very diversified (to decrease risk) and which have low expense ratios (to increase net return).

It will help if you add some more information. Please just add to your original post using the edit button, so that all of your information is in one place. Please see the post "asking portfolio questions" for format.

Do you have any debt, if so what types, amounts and interest rates?

What is your marginal tax rate, both federal and state?

Do you have an asset allocation (stock/bond mix) that you want to aim for?

Will you please add the fund names and expense ratios for the funds you are using in your 401k? We don't have the ticker symbols memorized, most people won't want to look up what funds you are referring so most people won't respond.

You are using Fidelity 500 Index Fund Premium Class (FUSVX), you should probably increase your use of that fund in your 401k. It's very diversified. I don't recognize the other ticker symbols you indicated in your 401k.

What other funds are offered in your 401k, besides the funds you are now using?

Do you have an IRA somewhere? If so what funds are you investing in?

You should consider opening an IRA if you don't have one.

Where is your investment account located, and what stocks and funds are you using there? In a taxable account you should use very tax-efficient funds, such as total market type stock index funds. Examples would include Vanguard Total Stock Market Index Fund and Vanguard Total International Stock Index Fund.

About how, much (in dollars) do you expect that you might be contributing to investing annually?
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started
Grt2bOutdoors
Posts: 23151
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: 25 year old - Investing for Tomorrow Tips

Post by Grt2bOutdoors »

I would do nothing before reading the following:

The Little Book of Common Sense Investing - John Bogle
The Only Guide to a Winning Investment Strategy - Larry Swedroe
The Four Pillars of Investing - William Bernstein
All About Asset Allocation - Rick Ferri

Then, I would write an Investment Policy Statement, invest according to said document, then stay the course.

Done!

The time you spend doing the above will pay you back in spades over your lifetime.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
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