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Old 08-27-2016, 01:29 PM   #1
Draz
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Default Anyone here invest in stocks / bonds?

And want to make an explain like I'm 5 guide on how to invest?

I feel like I'm reading on it a lot but they get straight to the point. We're missing the brokering fee, services, etc.

If anyone would be kind enough to educate the mass here on how and where to start with step by step instructions, you'll be mvp for the month.
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Old 08-27-2016, 05:21 PM   #2
Cleverness
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Default Re: Anyone here invest in stocks / bonds?

If you're looking for general advice, then read these books in order and you will know more about investing than 99% of the planet:

1. I Will Teach You To Be Rich by Ramit Sethi
2. Millionaire Teacher by Andrew Hallam
3. Boglehead's Guide to Investing


If you're looking for individual advice (or both), then it would be a lot easier to help if I knew some general info, such as:

Age
Income
How much you would like to invest per year
When you would like to retire
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Old 08-27-2016, 05:24 PM   #3
Draz
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Default Re: Anyone here invest in stocks / bonds?

24
Income is low because I'm part time and a student
Per year I can do $500-1,000
Retire: tomorrow

I'll read those thanks.
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Old 08-27-2016, 05:30 PM   #4
Cleverness
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Default Re: Anyone here invest in stocks / bonds?

For you, your plan is probably to pay off student loans ASAP and borrow/live off of as little as possible. Most of your loans are probably high(ish) interest rate loans around 6.8-7.9% right?

That is unless you are planning on doing PAYE + PSLF or PAYE + 20year forgiveness plans available for student loans

If you're planning on paying them off, then look into refinancing your loans after you graduate
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Old 08-27-2016, 05:31 PM   #5
KyrieTheFuture
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Default Re: Anyone here invest in stocks / bonds?

Quote:
Originally Posted by Draz
24
Income is low because I'm part time and a student
Per year I can do $500-1,000
Retire: tomorrow

I'll read those thanks.
So you can't invest in stocks
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Old 08-27-2016, 05:43 PM   #6
oarabbus
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Default Re: Anyone here invest in stocks / bonds?

The Little Book of Common Sense Investing by Bogle is great.

Some of the stocks in my portfolio:

VTI
VHT
VDC
MSFT
JNJ
AAPL

Also the easy way to start investing:

Step 1: Download Robinhood app for your phone (no commission fees)
Step 2: Enter in your bank info and transfer money into Robinhood App
Step 3: Purchase stock
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Old 08-27-2016, 05:45 PM   #7
Cleverness
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Default Re: Anyone here invest in stocks / bonds?

Here's a dummy version on the world of investing:

You can choose to invest in anything, but most commonly people invest in stocks and bonds.

When you buy stocks, you own part of that company. Any profits that company makes you get a portion based on your shares in the company. That company also owns buildings and products etc, so you own part of those as well.

Bonds are a bit more complicated because there are so many different types of bonds, but here's a good definition from a Google search:

Quote:
A bond is a debt security, similar to an I.O.U. When you purchase a bond, you are lending money to a government, municipality, corporation, federal agency or other entity known as an issuer.* In return for that money, the issuer provides you with a bond in which it promises to pay a specified rate of interest during the life of the bond and to repay the face value of the bond (the principal) when it matures, or comes due.

Most people purchase stocks and bonds through investment firms such as Charles Schwab, Fidelity, Franklin Templeton, T Rowe Price, Edward Jones, Prudential, etc. Of course, these places charge fees to manage your accounts for you, such as a brokerage fee in case you open a brokerage account.
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Old 08-27-2016, 05:49 PM   #8
Cleverness
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Default Re: Anyone here invest in stocks / bonds?

Quote:
Originally Posted by oarabbus
The Little Book of Common Sense Investing by Bogle is great.

Some of the stocks in my portfolio:

VTI
VHT
VDC
MSFT
JNJ
AAPL

Also the easy way to start investing:

Step 1: Download Robinhood app for your phone (no commission fees)
Step 2: Enter in your bank info and transfer money into Robinhood App
Step 3: Purchase stock

This is good advice if you looking into buying individual stocks. But if you are looking for LONG-TERM growth then I recommend the same thing Warren Buffet recommends for the typical investor: LOW COST index funds or lifecycle funds, such as VTTSX (https://personal.vanguard.com/us/fun...NT&FundId=1691)
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Old 08-27-2016, 05:51 PM   #9
Cleverness
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Default Re: Anyone here invest in stocks / bonds?

My advice for most people looking to invest into their retirement is

1. Pay off high interest debt
2. Contribute up to what your company/organization matches for your 401k/403b
3. Max out Roth IRA (or backdoor ROTH IRA for high-income earners)
4. Max out rest of 401k
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Old 08-27-2016, 05:55 PM   #10
Draz
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Default Re: Anyone here invest in stocks / bonds?

Quote:
Originally Posted by Cleverness
For you, your plan is probably to pay off student loans ASAP and borrow/live off of as little as possible. Most of your loans are probably high(ish) interest rate loans around 6.8-7.9% right?

That is unless you are planning on doing PAYE + PSLF or PAYE + 20year forgiveness plans available for student loans

If you're planning on paying them off, then look into refinancing your loans after you graduate
while I do pay for tuition, I'm debt free.
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Old 08-27-2016, 05:55 PM   #11
oarabbus
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Default Re: Anyone here invest in stocks / bonds?

Quote:
Originally Posted by Cleverness
This is good advice if you looking into buying individual stocks. But if you are looking for LONG-TERM growth then I recommend the same thing Warren Buffet recommends for the typical investor: LOW COST index funds or lifecycle funds, such as VTTSX (https://personal.vanguard.com/us/fun...NT&FundId=1691)

I want to go into Vanguard's main index funds. But from what I've seen the admiral shares are a minimum $10,000 investment. Don't have the money now to get those but maybe in a few years I will.
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Old 08-27-2016, 05:57 PM   #12
Cleverness
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Default Re: Anyone here invest in stocks / bonds?

If you would like to choose individual stocks to buy, then follow Oarabbus' post.

Step-by-Step instructions for index funds:

1. Open a Vanguard account at their website at vanguard.com (Vanguard has some of the lowest fees out there and will save you thousands of dollars in the long run compared to most other firms)

2. Buy VTTSX or another Vanguard Target Retirement Fund and just keep adding money whenever you can

3. Be patient and your money will grow about 7-8% per year over the long run (your money will double every 9-10 years)
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Old 08-27-2016, 06:10 PM   #13
Draz
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Default Re: Anyone here invest in stocks / bonds?

Quote:
Originally Posted by Cleverness
If you would like to choose individual stocks to buy, then follow Oarabbus' post.

Step-by-Step instructions for index funds:

1. Open a Vanguard account at their website at vanguard.com (Vanguard has some of the lowest fees out there and will save you thousands of dollars in the long run compared to most other firms)

2. Buy VTTSX or another Vanguard Target Retirement Fund and just keep adding money whenever you can

3. Be patient and your money will grow about 7-8% per year over the long run (your money will double every 9-10 years)

So, if one were to buy a stock, one wouldn't need a broker right? With the software, you can easily buy and sell?

I'm approaching 13k in savings, but I can't gamble on that with stocks
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Old 08-27-2016, 06:24 PM   #14
KyrieTheFuture
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Default Re: Anyone here invest in stocks / bonds?

Quote:
Originally Posted by oarabbus
I want to go into Vanguard's main index funds. But from what I've seen the admiral shares are a minimum $10,000 investment. Don't have the money now to get those but maybe in a few years I will.
When buying something like an admiral share, would you buy a single share or wait until you had like 100k to buy several?

Edit: Everything I'm reading has made it clear I don't understand anything about these shares
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Old 08-27-2016, 06:40 PM   #15
Cleverness
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Default Re: Anyone here invest in stocks / bonds?

Quote:
Originally Posted by Draz
So, if one were to buy a stock, one wouldn't need a broker right? With the software, you can easily buy and sell?

I'm approaching 13k in savings, but I can't gamble on that with stocks

Right. You can buy individual stocks with oarabbus' 3 easy steps

Buying individual stocks is very risky. Are you looking to purchase individual stocks or are you looking for safer, long-term growth for retirement?

Once you read those 3 books I listed you'll have a better idea of what you want to do (and probably be 100% all-in on index funds and VTTSX heh)
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