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| financial_advice [2008/09/15 21:29] – external edit 127.0.0.1 | financial_advice [2012/01/02 16:56] – Remove broken link, add FIXME peterwilliams |
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| ====Learn more==== | ====Learn more==== |
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| * Read [[http://en.wikipedia.org/wiki/Burton_Malkiel|Burton G. Malkiel]]'s 1973 classic //[[http://www2.wwnorton.com/catalog/fall06/006245.htm|A Random Walk Down Wall Street]]// for a thorough explanation of the [[financial_advice:glossary#Efficient Market Hypothesis (EMH)|Efficient Market Hypothesis]] (or why it's so hard to beat the market) and how to invest wisely. It's often called the first book any investor should read on investing. There's also an advice-only version //[[http://www2.wwnorton.com/catalog/fall04/032639.htm|The Random Walk Guide to Investing]]//, without all of the academic analysis. | * Read [[http://en.wikipedia.org/wiki/Burton_Malkiel|Burton G. Malkiel]]'s 1973 classic //[[http://www2.wwnorton.com/catalog/fall06/006245.htm|A Random Walk Down Wall Street]]// for a thorough explanation of the [[financial_advice:glossary#Efficient Market Hypothesis (EMH)|Efficient Market Hypothesis]] (or why it's so hard to beat the market) and how to invest wisely. It's often called the first book any investor should read on investing. There's also an advice-only version, //[[http://www2.wwnorton.com/catalog/fall04/032639.htm|The Random Walk Guide to Investing]]//, without all of the academic analysis. |
| | * [[http://money.stackexchange.com]] is a Q&A site with some good information. |
| * [[http://finance.yahoo.com/columnist/archives/headline/futureinvest/2006/1|Jeremy Siegel]] and [[http://finance.yahoo.com/columnist/archives/headline/millionaire/2005|David Bach]] have some [[http://finance.yahoo.com/columnist/allbios|columns]] which can be instructive. | * [[http://finance.yahoo.com/columnist/archives/headline/futureinvest/2006/1|Jeremy Siegel]] and [[http://finance.yahoo.com/columnist/archives/headline/millionaire/2005|David Bach]] have some [[http://finance.yahoo.com/columnist/allbios|columns]] which can be instructive. |
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| * Learn about [[http://en.wikipedia.org/wiki/Benjamin_Graham|Benjamin Graham]], [[http://en.wikipedia.org/wiki/Warren_Buffett|Warren Buffett]] and [[http://en.wikipedia.org/wiki/Berkshire_Hathaway|Berkshire Hathaway]], the paragons of active, low-risk, high-return, "value" investing. | * Learn about [[http://en.wikipedia.org/wiki/Benjamin_Graham|Benjamin Graham]], [[http://en.wikipedia.org/wiki/Warren_Buffett|Warren Buffett]] and [[http://en.wikipedia.org/wiki/Berkshire_Hathaway|Berkshire Hathaway]], the paragons of active, low-risk, high-return, "value" investing. |
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| * [[http://www.morningstar.com|MorningStar]] is the gold standard for analysis of mutual funds, and has a handy, free web interface for keeping track of your investments. Just don't take their star system too seriously. | * [[http://www.morningstar.com|MorningStar]] is the gold standard for analysis of mutual funds, and has a handy, free web interface for keeping track of your investments. Just don't take their star system too seriously. |
| | * [[http://www.fool.com|Fool.com]] is all about trying to beat the market (which is, in fact, a foolish strategy). |
| * [[http://www.fool.com|Fool.com]] is all about trying to beat the market. | |
| * [[http://www.fairmark.com/rothira/toc-roth.htm|Roth IRAs]] can get kind of complicated. | * [[http://www.fairmark.com/rothira/toc-roth.htm|Roth IRAs]] can get kind of complicated. |
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| ====Bottom line advice==== | ====Bottom line advice==== |
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| * Pay off your credit card bills. If possible, make this your most important financial priority after school, food and shelter. | * Pay off your credit card bills. If possible, make this your most important financial priority after school, food and shelter. |
| * Open a [[http://www.bankrate.com/brm/rate/mmmf_highratehome.asp?params=US,416&product=33&sort=2|high yield internet bank account]] and keep spare cash there. | * Open a [[http://www.bankrate.com/brm/rate/mmmf_highratehome.asp?params=US,416&product=33&sort=2|high yield internet bank account]] and keep spare cash there. |
| * Open a Roth IRA mutual fund at T. Rowe Price (start with [[http://www.troweprice.com/common/indexFundFacts/0,0,ticker=74149P762,00.html?rfpgid=7155&ddown=Fund_by_Name&scn=Find_a_Fund|Retirement 2045]]) and set up automatic, monthly contributions of at least $50. Aim for maxing out your IRA, if you can afford it, at $333/mo. | * Open a Roth IRA mutual fund at T. Rowe Price (start with [[http://www.troweprice.com/common/indexFundFacts/0,0,ticker=74149P762,00.html?rfpgid=7155&ddown=Fund_by_Name&scn=Find_a_Fund|Retirement 2050]]) and set up automatic, monthly contributions of at least $50. Aim for maxing out your IRA, if you can afford it, at $412 per month. (FIXME as of January 2012: is Vanguard a better IRA custodian these days?) |
| * If you've worked here for a summer already, [[https://login.fidelity.com/ftgw/Fidelity/NBPart/Login/Next|move your DCP savings]] into something like the Spartan S&P 500 [[http://badgrads.berkeley.edu/doku.php?id=financial_advice:glossary#index_fund|index funds]], where it can start to grow for you. | * If you've worked here for a summer already, [[https://login.fidelity.com/ftgw/Fidelity/NBPart/Login/Next|move your DCP savings]] into something like the Spartan S&P 500 [[http://badgrads.berkeley.edu/doku.php?id=financial_advice:glossary#index_fund|index funds]], where it can start to grow for you. |
| [[https://personal.vanguard.com/us/VanguardViewsArticle?ArticleJSP=/freshness/News_and_Views/news_ALL_chaircorner2Q06_07132006_ALL.jsp|Longer term]]: | |
| *Live below your means | Longer term: |
| *Participate in the markets | * Live below your means |
| *Invest regularly | * Participate in the markets |
| *Get knowledgeable | * Invest regularly |
| | * Get knowledgeable |
