On-line trading...

[BuffaloBill]

No I get what you're saying. But here's what a real planner (me ) does. It's not just about investing. It's about planning. How much do you need to retire? Are you on track? Can we get you on track if you're not? When and where do you want to retire? What's the most tax efficient way to plan? Do you have any guaranteed income for retirement? How do we control your taxes today and tomorrow? Do you have enough life insurance? Too much? Is it the right kind of insurance? Long term care? Disability? Who's going to take care of you when you can't? Who is going to take care of your kids if you can't? Who's going to take care of your parents when they can't? Is the trust done? Is it funded right? Who are the beneficiaries on your retirement accounts? Who is the beneficiary on your life insurance? Is it your wife, the trust, the kids? It's not just stocks, bonds and mutual funds. And most of us really care about our clients. But that stuff doesn't make the evening news.

 

(also in response to Fezmid)

 

My parents (who while not poor are far from being rich) have used a planner for many years and swear that working with him (and his dad - jointly own the practice) was one of the best decisions they ever made. As for me, I am a "do -it -yourselfer" because I truly enjoy budgeting, investing and planning (my situation is also arguably much easier because no kids and very solid income).

 

I also truly enjoy following stocks / companies / the market and assuming my brain does not get fried (worse than it already is) I plan to do it for a long time to come. I've tried to help myself by learning in a methodical way and not getting exotic in anything that I do. I would say that I am risk prudent vs. some level of risk tolerant. Where I tend to struggle is with time. Even though I do much on my own I do not do everything, I take classes, I read and I have open conversations with people who are more versed in a given issue than I am.

 

At the end of the day whether or not you use a planner requires you to take an honest look at yourself and to consistently monitor whether your plannner is meeting your needs if you do. In no situation should you trust your financial "empire" to any one person / firm (including yourself). If you are handing money over to someone to "manage" in one form or another it is your responsibility to understand, agree to and oversee what they are doing. If you do not then you like many others may run across the "bad egg" and be burned because of it.

 

I would (and have) run far away from anyone who starts a conversation extolling their knowledge of "the market," or offers you some insight on how you might just get rich quickly. They are likely scammers and liars.

[Chef Jim]

How much does it cost to have someone (like you) do all that stuff for you? Is there a flat fee or percentage?

 

It can be a flat fee or a percentage. To have it all done (including the trust and getting it funded, taxes and the written financial plan) runs around $10,000 at the high end plus the cost of any insurance. So it's not cheap but a proper plan could save you and the next generation tens or hundreds of thousands of dollars over your lifetime. Keep in mind that's the cost for our offices in SoCal and it might be a lot cheaper where you live. Up here in SF we may charge more, we're still working on the cost structure up here. We're looking at an Estate Attorney up here that charges $4k alone just to do the trust, but that include all the funding.

[Chef Jim]

(also in response to Fezmid)

 

My parents (who while not poor are far from being rich) have used a planner for many years and swear that working with him (and his dad - jointly own the practice) was one of the best decisions they ever made. As for me, I am a "do -it -yourselfer" because I truly enjoy budgeting, investing and planning (my situation is also arguably much easier because no kids and very solid income).

 

I also truly enjoy following stocks / companies / the market and assuming my brain does not get fried (worse than it already is) I plan to do it for a long time to come. I've tried to help myself by learning in a methodical way and not getting exotic in anything that I do. I would say that I am risk prudent vs. some level of risk tolerant. Where I tend to struggle is with time. Even though I do much on my own I do not do everything, I take classes, I read and I have open conversations with people who are more versed in a given issue than I am.

 

At the end of the day whether or not you use a planner requires you to take an honest look at yourself and to consistently monitor whether your plannner is meeting your needs if you do. In no situation should you trust your financial "empire" to any one person / firm (including yourself). If you are handing money over to someone to "manage" in one form or another it is your responsibility to understand, agree to and oversee what they are doing. If you do not then you like many others may run across the "bad egg" and be burned because of it.

 

I would (and have) run far away from anyone who starts a conversation extolling their knowledge of "the market," or offers you some insight on how you might just get rich quickly. They are likely scammers and liars.

 

But once again all your talking about is investing. Planning goes so much deeper. You say planning in your case is easier because you don't have children. I say no and I know this from experience because I don't have kids either. When you're old and can't take care of yourself and you have no kids, who's going to take care of you? What if you find yourself incapacitated and your wife is 100% healthy, any idea what that could do to the rest of her life if all your savings is zapped dry just to take care of you? It's not all about today or even a few years from now. Proper planning is a decades long process with lots of life events that require a lot of thought.

[BuffaloBill]

But once again all your talking about is investing. Planning goes so much deeper. You say planning in your case is easier because you don't have children. I say no and I know this from experience because I don't have kids either. When you're old and can't take care of yourself and you have no kids, who's going to take care of you? What if you find yourself incapacitated and your wife is 100% healthy, any idea what that could do to the rest of her life if all your savings is zapped dry just to take care of you? It's not all about today or even a few years from now. Proper planning is a decades long process with lots of life events that require a lot of thought.

 

 

Understood. I have also reviewed my insurance situation, completed a will, set aside emergency funds, looked at taxed advantaged income deferral vehicles (as you know essentially another form of life insurance), etc, etc.

[Chef Jim]

Understood. I have also reviewed my insurance situation, completed a will, set aside emergency funds, looked at taxed advantaged income deferral vehicles (as you know essentially another form of life insurance), etc, etc.

 

Just a will? Do you own a home?

[BillsFanNC]

Before even entertaining the thought of trading individual stocks you should be able to answer yes to the following four questions:

 

Are you contributing the max to your 401k plan at work?

Are you fully funding a Roth IRA each year?

Do you have an at least 6 month emergency fund for living expenses?

Are you consumer debt free?

 

Unless you can answer yes to all four of the above you have no business whatsoever buying and selling individual stocks. I'd guess there is a very small percentage of the population that can answer yes to all four. To go even further, even if you do meet the above criteria most folks would be better off going to a fee only financial planner or educating him or herself and investing in low cost mutual funds with a company like Vanguard or Fidelity.

 

If you can answer yes to all four then you can set up a play money account to trade individual stocks. Only put in what you can afford to lose as Chef Jim said. You cannot beat the market in the long run.

 

I'd suggest going to these forums and peruse them for awhile. There is a wealth of information there for the investing novice.

[The Dean]

First of all, I am not a big stock market player. I only own some shares of the company for which I work. And my wife and I have some stock through her broker, but he charges quite a bit for a transaction. Anyway, I have an itch to jump on some stock that I have been following lately. It's up $2 in the past couple days, so I need to get the ball rolling. I checked out scottrade and etrade, but am not sure which, if any, would be better. There are a lot of sites out there, but a lot of them sound pretty much the same. Does anyone have any suggestions for trading sites? I am sure there are a few on-line traders on this board. Much appreciated, Thanks!

 

 

http://www.tvg.com/

 

If you live in the right state, you can make your bets right through your cable/Direct TV/Dish Network box. The channel offers analysis and handicapping tips. Get a subscription to The Racing Form, and you're all set!

 

http://en.wikipedia.org/wiki/TVG_Network

 

EDIT: Of course, you should only bet what you can afford to lose. That goes without saying.

[plenzmd1]

Before even entertaining the thought of trading individual stocks you should be able to answer yes to the following four questions:

 

Are you contributing the max to your 401k plan at work?

Are you fully funding a Roth IRA each year?

Do you have an at least 6 month emergency fund for living expenses?

Are you consumer debt free?

 

Unless you can answer yes to all four of the above you have no business whatsoever buying and selling individual stocks. I'd guess there is a very small percentage of the population that can answer yes to all four. To go even further, even if you do meet the above criteria most folks would be better off going to a fee only financial planner or educating him or herself and investing in low cost mutual funds with a company like Vanguard or Fidelity.

 

If you can answer yes to all four then you can set up a play money account to trade individual stocks. Only put in what you can afford to lose as Chef Jim said. You cannot beat the market in the long run.

 

I'd suggest going to these forums and peruse them for awhile. There is a wealth of information there for the investing novice.

 

Not to be a prick here, but if you are saying you need all 4 of these things to invest money in any market, whether it be real estate, stocks, bonds etc... thast that is just wrong.

 

Consider many folks CANNOT qualify for a Roth. Sure as chit know I can't.

Consider I would think it absolutely nuts to not have a mortage(consumer debt), at least until Mr Obama decides that is no longer tax deductable.

Maybe many reasons why someone would choose not to max out a 401k plan.

 

 

In other words, as in most things in life, there are NO absolutes..except death, taxes, and the Bills losing in ungodly fashions. If someone is saying not to invest in a business they believe in cause they don't have a finacial planner, that's just BS. Now, that person should not invest 100% of their savings, but you know I mean. Crimminy, Peter Lynch always yapped about how he never invested in a business he didn't understand. So maybe the original poster knows that this this particular company has a long term competitive advantage and wants to invest>>>you all are saying there is something wrong with that???

 

Listen, I know I am an old fart, and being as such have made a TON of mistkes in my financial dealings. But I have made some GREAT moves as well, some when I was a just a lad in my early 30's that are still paying dividends today . I do use a a few guys now..a fee besed money manager and a tax and estate guy. I still make trades on my own as well though, and recently jumped into the landlord business...of which I am learning a ton about now ( feel like I did 20 years ago buying my first stocks).

[Fezmid]

Not to be a prick here, but if you are saying you need all 4 of these things to invest money in any market, whether it be real estate, stocks, bonds etc... thast that is just wrong.

Well to be fair, he did say "individual stocks."

 

And I don't think he's wrong.

 

Consumer debt is generally not lumped in with mortgage debt, it usually means credit cards (at least in my mind).

[BillsFanNC]

Not to be a prick here, but if you are saying you need all 4 of these things to invest money in any market, whether it be real estate, stocks, bonds etc... thast that is just wrong.

 

You are right in that those four questions will not apply to everyone, but in my opinion they will apply to a vast majority of people.

 

Consider many folks CANNOT qualify for a Roth. Sure as chit know I can't.

 

Correct if you don't qualify then obviously it won't apply to you. But for those that do qualify they will be MUCH better served putting those after tax dollars into a roth rather than buying individual stocks.

 

Consider I would think it absolutely nuts to not have a mortage(consumer debt), at least until Mr Obama decides that is no longer tax deductable.

 

Again correct. I was talking more credit cards and car loans. Student loans and mortgage debt where you get a tax deduction don't apply here.

 

Maybe many reasons why someone would choose not to max out a 401k plan.

 

Perhaps, but I can't think of many good reasons why it would be a good idea to gamble with after tax dollars in individual stock picking vs. putting pre tax dollars into a sheltered 401k.

 

In other words, as in most things in life, there are NO absolutes..except death, taxes, and the Bills losing in ungodly fashions.

 

True, but for the vast majority of Americans who understand next to nothing about the markets those four criteria better hold true before considering trading in individual stocks.

 

If someone is saying not to invest in a business they believe in cause they don't have a finacial planner, that's just BS. Now, that person should not invest 100% of their savings, but you know I mean. Crimminy, Peter Lynch always yapped about how he never invested in a business he didn't understand. So maybe the original poster knows that this this particular company has a long term competitive advantage and wants to invest>>>you all are saying there is something wrong with that???

 

Not necessarily. But if he/she is carrying consumer debt or not contributing enough to retirement accounts or doesn't have a rainy day fund I don't care how much they know about a business, trading stocks isn't a good idea.

 

Listen, I know I am an old fart, and being as such have made a TON of mistkes in my financial dealings. But I have made some GREAT moves as well, some when I was a just a lad in my early 30's that are still paying dividends today . I do use a a few guys now..a fee besed money manager and a tax and estate guy. I still make trades on my own as well though, and recently jumped into the landlord business...of which I am learning a ton about now ( feel like I did 20 years ago buying my first stocks).

 

I trade stocks too, but it's only play money (money I can afford to lose) and I have resolved that when and if that money is gone then it's gone and my career as a stock picker is over. In other words I do it as a hobby because I realize that the market is smarter than me and everyone else.

[plenzmd1]

Well to be fair, he did say "individual stocks."

 

And I don't think he's wrong.

 

Consumer debt is generally not lumped in with mortgage debt, it usually means credit cards (at least in my mind).

I get that...point of my post is there are no absolutes. I fit into only one of his criteria...should I not be investing in stocks???

 

 

My point would then go the ..why buy mutual funds that invest in stocks???? I assume in both 401K and Roth accounts(i know little of Roths cause according to our governemnt I am too rich to have one ) most people have mutual funds that buy STOCKS. Remember, that while gains are protected from taxes whilst remaining in the 401K, losses are not offsettable. These plans are strictly tax vehicles, they in and of themselves are not invetsments. And lets not forget the people that are getting whacked right now by having to take mandatory distributions from their 401ks and are getting murdered in the double whammy of having to take the losses without a way for them to offset gains, plus paying taxes on the money as income even though they LOST money on the some of these funds.

 

Yes, people can own index funds in the 401k plan, but again they own STOCKS for the most part . Some would say I can buy money market funds in my 401k to avoid risk..tell that to people who owned those funds when they slipped below $1.00 last fall.

 

 

Again, all I am saying is there are NO absolutes.. if the origianl poster has spotted a comapny he believes will provide a better return than other options, that is the nature of investing. Do not get wrapped around rules that are supposed absolutes that have a lot of 50 and 60 something peoiple now worried about if they have enough money to retire.

[BillsFanNC]

I get that...point of my post is there are no absolutes. I fit into only one of his criteria...should I not be investing in stocks???

 

 

My point would then go the ..why buy mutual funds that invest in stocks???? I assume in both 401K and Roth accounts(i know little of Roths cause according to our governemnt I am too rich to have one ) most people have mutual funds that buy STOCKS. Remember, that while gains are protected from taxes whilst remaining in the 401K, losses are not offsettable. These plans are strictly tax vehicles, they in and of themselves are not invetsments. And lets not forget the people that are getting whacked right now by having to take mandatory distributions from their 401ks and are getting murdered in the double whammy of having to take the losses without a way for them to offset gains, plus paying taxes on the money as income even though they LOST money on the some of these funds.

 

Yes, people can own index funds in the 401k plan, but again they own STOCKS for the most part . Some would say I can buy money market funds in my 401k to avoid risk..tell that to people who owned those funds when they slipped below $1.00 last fall.

 

 

Again, all I am saying is there are NO absolutes.. if the origianl poster has spotted a comapny he believes will provide a better return than other options, that is the nature of investing. Do not get wrapped around rules that are supposed absolutes that have a lot of 50 and 60 something peoiple now worried about if they have enough money to retire.

 

Diversification lowers risk.

[The Dean]

Diversification lowers risk.

 

 

http://www.truveo.com/Chappelles-Show-Wu-T...l/id/1203303284

[KD in CA]

What stock?

 

 

Yeah, what's the stock?

[DC Tom]

Yeah, what's the stock?

 

Not IRobot, I hope. Took a bullet this morning. Good thing I sold last week.

[BuffaloBill]

Just a will? Do you own a home?

 

 

In the interest of being reasonable about not disclosing too much about my personal situation let me leave it as I understand the basis of your questions and yes have taken the issues in account from a planning perspective. Does the situation continue to evolve - clearly - yes.

[Stussy109]

Scottrade all the way... i have been using is for about 6 yrs or so. It is not the cheapest at 7$, but is the easiest in my opinion.

 

great time to invest in general! Real estate and stocks.

[Pine Barrens Mafia]

Diversification lowers risk.

 

 

It didn't in this downturn.

[Fezmid]

It didn't in this downturn.

 

Lowers != eliminates

[Pine Barrens Mafia]

Lowers != eliminates

 

Some "advisors" pimp diversification as a means to assuage customers' fears of risk. Personally, I think a lot of these same "advisors" use diversification as a means to fatten their commission take. More trades=more income.