What, exactly, can we use to build and keep our wealth. First will be exactly what I tell my year-old to do. She could care less about investing. All she needs to do is to keep adding to the pot and let it ride. Your personal situation is likely different from ours. If you want to survive and prosper as an investor you have two choices. You can follow Dr. Your hope is that this will smooth out the ride even as it reduces your long-term returns.

Put all your eggs in one basket and forget about it. The great irony of investing is the more you watch and fiddle with your holdings the less well you are likely to do. Fill your basket, add as you go along and ignore it the rest of the time.

Low cost so almost all our money is working for us. You have decades ahead. Perhaps 40 years from now you might want to add a Bond Index Fund to smooth out the ups and downs. Worry about that 40 years from now. At this point I can see the financial gurus of the world gathering feathers and heating up the tar. So let me explain. Previously, we explored the idea that financial crisis are just part of the landscape and the best results come from simply riding them out.

But if you are mentally tough enough you can ignore them. Clearly we want the best performing asset class we can find. If you look at all asset classes from bonds to real estate to gold to farmland to art to racehorses to whatever, stocks provide the best performance over time.

Nothing else comes close. Stocks are not just little slips of traded paper. When you own stock you own a piece of a business. When you own VTSAX you own a piece of every publicly traded business in the USA. Many have extensive international operations so you get to participate in the world markets too. These are companies filled with people working relentlessly to expand and serve their customer base.

It is this intense dynamic that makes stocks and the companies they represent the most powerful and successful investment class in history. The only downside, and I mean only, is that the ride will be very rough at times. If you are not tough enough to stay the course, if you get scared and bail when the storms are raging you are going to drown.

It is also slightly less volatile. Could it really be this easy? I started investing in At the time VTSAX had yet to be created Bless you Jack Bogle!

Put all your eggs into one basket, add more whenever you can and forget about it. Now I want to hang on to it. I want a smoother ride. A few years ago as I was nearing my own retirement I made some additions to VTSAX. Hold on now, this is going to get really complicated.

We now enter the world of Asset Allocation and this will require slightly more of our time. You can handle it. High short-term risk read: Perfect for those who can handle the ride and have the time. Maybe a bit more peace of mind is required. You have to sleep at night.

My wife and I hold some other stuff in our portfolio. REITs Real Estate Investment Trusts invest in real estate. They provide an inflation hedge and dividend income. But during periods of deflation real estate prices plummet.

I no longer hold VGSLX. Please See Addendum I below for how this has changed. Cash is always good to have in hand. Cash is also king during times of deflation. The more prices drop, the more your cash can buy. Money Market Funds used to offer higher yields than banks. When rates rise they will again.

These days, with interest rates near zero, not so much. Now we also keep some in our local bank. If you prefer, an on-line bank like ING works fine too. A wealth builder, an inflation hedge, a deflation hedge and cash for daily needs and emergencies. Low cost, effective, diversified and simple. You can fine tune these investments to your own personal considerations.

Want a smoother ride? Willing to accept a lower long-term return and slower wealth accumulation? Just increase the percent in VBTLX. Add more to VTSAX. So, each dollar not in stocks is a dollar working below par. Dollars in cash are completely lazing away in the sun drinking Pina-coladas. Problem is sometimes to beat this analogy to death financial panics and market collapses come along and kill off a bunch of my slaves working away in the stock market fields.

But still, even these tend to get wounded in a collapse. But when collapses come they are away from the bullets. They are the most rested of all when I put them back to work. Their laziness drives me crazy but when the crunch times come I always wish I had more of them. But you are giving up a big slug of wealth building potential. What if we did this:. Since most of the time the market goes up, this portfolio will have a far stronger ability to build wealth.

We can draw our 40k from the dividends and capital gains our stocks in VTSAX throw off. When times get tough and stocks slide, we leave VTSAX alone and let it heal.

When times improve we go back to tapping VTSAX and we rebuild our cash position for the next cycle. What do you think? This link takes you to the post outlining his new portfolio. While different than those here, it follows the key principles: Simple and low cost trump the differences. So consider this one more Portfolio Idea to Build and Keep Your Wealth. This is a great example of the right way to use and think about VTSAX. A free trip to Hawaii!

Any new user is eligible, so long as you link an investment account. Stock Investing Series Tagged With: May 13, at 1: I like the idea of wealth building with cash. What if markets slide for more than 3 years? And markets may fall until we can get our financial house in order. What if you add reserve up to 5 years?

So, a young person may not need much but an older person may need higher percentage of cash reserve to ride out market volatility. When I look at the debacle I see a three year climb out of the hole. It keeps the majority of capital at work while providing cash to ride out even a very nasty storm.

Were an upcoming storm to prove even nastier, we would have to tighten our belts to make it thru. But that is likely true with almost any asset mix. Interesting idea about increasing the percent of cash as one ages. Maybe a very young person might even decrease it…. May 13, at 2: While I strongly support most of this, do you have any thoughts on foreign investing? I currently hold some VEIEX and VTMGX—if you wanted to keep it simpler I believe Vanguard has an all-world-minus-U.

As you point out, Vanguard offers International Index Funds. The US is still the dominate world economy and, in my view, will remain so for the next years and counting. That dominance will shrink over time, as it has been doing since the end of WWII, but it is not ending anytime soon.

VTSAX is loaded with US companies that are fully international in their operations. Indeed many generate well over half their revenue and profits overseas. So it provides exposure to expanding world markets. This trend will continue to expand as the international economies around the world continue to grow and prosper. Accounting standards and transparencies in the US remain the envy of the world. Less funny business to worry about.

Direct international investing introduces currency valuations into the mix and that is a whole other level of risk that needs to be considered. March 23, at 4: Points 2 and 4 are very valid. Points 1 and 3 are somehow speculative. There you can see that currency risk in the long run 20 years plus is negligible or non-existent.

So point 5 is valid for retirees. May 13, at 6: I quite like the idea of keeping some cash around. All the better to go shopping with when the markets take a dump. True enough, but in this strategy the cash would be there to prevent selling while the market is swooning. If you are keeping some cash aside to invest on drops, how do you decide when the market has dropped enough? Seems I always push my chips in too soon….

I guess the trick is having the conviction huevos to double down. May 13, at 7: March 4, at A little late to the party, but you need a systematic process for investing your cash. Pick a number that you think the stock market will return on average over your lifetime. You save your money each year. At the end of the year, you look and see what the stock market did that year. Take your wife out to a nice dinner and celebrate. But leave your cash sitting there.

Put all your savings in the market. This forces you to buy on the way down, and not buy on the way up. May 15, at 8: You include your home equity as real estate? That part surprises me. May 15, at I agree that a personal home is not an investment, but since it does soak up a big chuck of my net worth I like to include it as I consider my asset allocations.

May 17, at 6: I know this is probably obvious to everyone else, so apologies for the dumb question. May 17, at 4: May 18, at 4: I vaguely recalled I had asked the question previously — thanks so very much for such a thorough response! I used to be spread out all over with Vanguard — Energy Fund, PrimeCap, V and more. Thanks again for such a substantive blog, I always am happy to see a new post. May 18, at 8: May 19, at 8: I have loads of questions, lol.

You could cull them and use some as springboards for future posts. May 27, at I really like this investing strategy but I am having a hard time understanding from looking at the chart for VTSAX on google finance how I would achive these massive gains that you are talking about.

Overall, the chart does not indeed always go up. Is this dividend income the only growth that is gained from the fund? Up until yesterday I was planning on implementing the dogs of the dow strategy that Jacob from ERE recommends. May 27, at 6: If you look at the chart from its inception what you are seeing is the last years of exceptional volatility the market has been thru. Check out the chart here: Or look at the chart I provided in Part IV of the series for an evan longer view.

Sometimes higher, sometimes lower depending on the direction of the market at any given moment. Just like an individual dividend paying stock. There are plenty of conversations elsewhere, like ERE, on it. Since dividends rise as share prices fall the idea is that these companies have likely seen problems and a drop in their share price.

I will say this. If I were trying to retire as early as possible with as little capital as possible I might consider it. Suppose you had k and wanted to hang it up.

May 27, at 7: May 28, at Hi Jim- Here is a solution for those of us who work with brokers: May 28, at 2: May 28, at 6: The stock market is a great vehicle for exactly two groups of people: We have to hope that there is more money pouring into the stock market in the future to keep share prices rising if we hope to achieve our investment goals. But stock prices are a function of supply and demand. What would happen if demand left the market for a very long time?

As it clearly states in every stock market-related commercial: And if everyone is basing their investment strategy on the belief that because it has always gone up over time it will continue to do so, that seems like a disaster waiting to happen. That is the same logic people were using for buying into the top of the tech bubble.

And while index funds are surely a better bet than typical mutual funds due to lower management fees, in reality you are trading one stock-picker for another. But what about the companies comprising the indexes? Their executives and boards are diluting the hell out of your shares with the options they grant themselves.

And then they take the cash that could have been returned to you as a dividend and initiate share buybacks to cover up all of that dilution. They have found a great way to enrich themselves at your expense, and no one seems to mind much so long as the stock price continues to climb.

Our economy and our stock market are not ATMs with a never-ending supply of cash coming out of them. They are vulnerable to many things beyond the control of anyone — even our politicians, central bankers, etc. Inthe Pope divided the new worlds up between the two greatest world powers, Spain and Portugal. The stock market could revert to its original purpose of raising capital for corporations instead of being a vehicle for enriching the brokerages and corporate executives at the expense of shareholders.

Companies could start paying real dividends again higher than their bond rates since equity is inherently more risky and stop diluting their shareholders. The politicians could gets their acts together and reform social security, medicare, etc. May 28, at 8: Reading thru your comment, pretty clearly we are going have to agree to disagree.

My views are laid out in some detail in my Stock Series and address the issues you raise. True enough, but also true of anything at all.

When it comes to predicting the future we have to work with what we have. Not sure how the size of dividend payments makes stocks a Ponzi scheme. There is nothing magic about dividends. They are only one option companies can use for allocating their earnings. Basically there are four things at least that I can think of off the top of my head that companies can do with their profits. They can pay them out as dividends. They can use them to build the company.

They can buy back their own shares. They can buy other companies. They can sit on them waiting for opportunities. See I came up with a fifth! Further, dividends are not related to or dependent on investment money coming into the market or the stock paying the dividend. They are sourced from the earnings of the business. Supply and demand are only one force driving stock prices. There is a profound difference between what an active fund manager is attempting and the flow of stocks into and from an index.

The active manager is trying to choose which companies will out perform their peers. Will JPMorgan do better than Bank of America? An index adds companies as their business grows to a sufficient size and discards them only when their business collapses below a minimum level.

This is a very powerful process of self cleansing. I covered this in some detail here: Certainly there are executive abuses in the board room, but they are not as common as you seem to believe. Shareholders can, and do, vote with their feet. If the execs and board of a company behave irresponsibly it takes surprisingly little time for shareholders to react and step away.

Finally, share buybacks are not done to cover up dilution, nor would they be effective in that roll. They are an alternative way to return value to the shareholders, exactly like dividends, but without tax consequences.

But the US is still the dominate world economy and, in my view, will remain so for the next years and counting. Overall, a fair list of some of the challenges around today, and they are not likely to be resolved in anything like a timely manner. But it is no where near as grim as the list that might have been put together in or or or So, as I said, we disagree and that leaves me curious. Where do you invest your nest egg? August 8, at 5: Is that a fair summary? August 8, at 6: To your two summery points, I would add that a growing world economy is great for the US.

Our share of the pie may be shrinking, but the pie itself is becoming ever larger. At the end of WWII, we had practically the entire pie to ourselves.

But that is half of a far larger pie and has made for a far larger and more prosperous US economy. It is not a zero-sum game. The better the rest of the world does, the larger and greater the market for the typically high-value goods we export to it. Especially in the silly-season election cycle years like this one.

Schedule 3 of Companies Act, : General Instructions for Preparation of Balance Sheet and Statement of Profit and Loss of a Company | Corporate Law Reporter

May 30, at 9: How are you figuring this? Back on the Dow was at about and today it is about That is only 14 time greater. May 30, at May 31, at 3: May 31, at 5: June 1, at The company I work for is employee owned. A total of 40k in my retirement fund.

A total of 70k private savings. I put away about half my income, but have not maxed out my retirement in the past. I live in a relatively expensive housing city, and currently looking at rental properties duplex or triplex. I see this as a much better investment than a house, which my friends are all buying. I know it will be more work, but the numbers work out so much better. If I were to buy I will have to use all of my savings and probably dip into some of the retirement.

June 1, at 3: Other than saving and the investment property. And I agree the multi-family is the better investment. Think long and hard before taking it on. The market is filled with people burned and desperate to get out of it. I still do it for fun with a tiny amount of my capital, but the heavy stock lifting in my portfolio is done by VTSAX. June 1, at 5: The company stock is not in the same investment category as regular stock.

The company is small people and not publicly traded. I also see this as an investment in my career and position within the company. June 19, at You have a way of simplifying everything without being condescending that is very unique.

If you ever get bored with retirement, you should consider becoming a teacher, or at least a financial tutor. My only disappointment is that I did not find your blog or this series a year ago. Oh well, live and learn, right? Thanks for all of the great advice!

June 19, at 2: Thanks for the encouragement! I love your direct, straightforward approach. August 2, at 9: One question that I have is at what point do you sell? August 15, at Dividends are based on the dividends the stocks held in the fund pay and they are paid out on a regular basis, typically twice a year.

You can choose to have them paid to you in cash or reinvested in the fund. Capital gains distributions are any capital gains the fund earned by selling stocks within the fund. As you might guess from the name these are paid out, or distributed, on a regular basis just like the dividends.

Like dividends, you can choose to have them paid to you in cash or reinvested. Finally, if your fund shares increase in price you will also have a capital gain. However, this is not distributed and no tax is due until you sell your shares. To access this money you must sell shares, something you can do anytime. You can also arrange to have shares sold automatically.

August 19, at I know about dividends but not those. The page for VTSAX on Google Finance only shows dividends but not capital gains distributions information as far as I can see. August 19, at 5: As an index fund VTSAX will very rarely, maybe never, sell the stocks it holds so you are unlikely to see a capital gains distribution. If there is a net gain on these transactions, the shareholders receive a taxable distribution. Any net loss is NOT tax-deductable to the shareholder, but it is carried forward in the fund to offset any future gains.

Very sorry to hear you are having trouble with the follow-up comment feature. August 19, at 9: December 23, at Why do you recommend VTSAX over the ETF version of the fund VTI?

I am looking to invest in one next year in a non tax deferred account. It seems like the trading costs that go along with the mutual fund make it slightly less attractive than the ETF. December 31, at As you point out, VTSAX and VTI are just different versions of the same fund, along with what is called Investor Shares which has a 3k buy in and a slightly higer expense ratio.

VTSAX is just the version I own. VTSAX and VTI even have the same ultra low expense ratio and you can get into VTI with out the 10k minimum invstment required by VTSAX. But dealing directly with Vangard, no problem. May 10, at 1: I pretty new to anything stock market.

My main question is about the act of buying stocks. Is there some kind of software? I am 26, so is my wife, and we have a 2 yr old son. These loans are NOT accruing interest until I finish all my schooling, at which point we will have the money saved to pay them off before they ever do. And, to follow on my last question, I assume one sells stocks in a similar fashion to buying them — but HOW? May 10, at 3: Sometimes they can be real difficult about this, one of the many reason I recommend avoiding them in the first place.

You can get into their TRFs. Which these days pays close to zero interest. This good advice and is what you should do. But it is not what I, with my high risk tolerance, would do. I would add all this money as I could to my VTTSX fund. If the market had declined during the years leading up to my graduation, I would simply keep my money invested and keep buying more shares as I could, knowing I was getting them at cheap prices.

Assuming you provide Vanguard with your bank info, you can move your money with a few mouse clicks or a phone call. Or you can mail them checks for deposits and have them send you checks for your withdrawals. November 4, at 9: November 4, at You buy ETFs in any amount you want, just like a stock. If you start with VTI or VTTSX you would have to manually roll it into VTSAX once you hit 10k and it would be a taxable event.

However, since the ERs are the same you could just leave it in VTI. November 7, at 3: Thank you for stock market search spyker thorough response.

This site has been an invaluable tool as I attempt to educate myself on the mystifying world of finance. January 29, at February 19, at 4: Your thinking on interest rates, housing and REITS is sound.

As it happens, I agree with your assessment. But remember, we are both now on the slippery slope of predicting the future and timing the market. A losers game, that. Be careful overweighting into REITS. As it also happens, I am in the process of selling my house and returning to the wonderful carefree life of renting. As I discuss above, at this stage of my life I personally use the The Wealth Preservation and Building Portfolio.

Once I free up the house equity it will go into this fund to maintain the allocation, but no more. It is a taxable event. Unless, of course, you hold the funds in a tax deferred account like an IRA or k. In that case you can buy and sell funds tax free even across fund companies.

March 8, at content currency trading for dummies download free I had a question, I have a fidelity investment account through work exercised stock options go to this after-tax account here and it says I can only invest in the VTSMX and not the VTSAX admiral shares.

It says the VTSAX is closed to new funds even though I can meet the minimum of 10k in my account. Do you know if I can only get VTSAX through Vanguard. Also, your opinion on FSTVX? Net expense ratio of FSTVX is 0. March 8, at 1: If you have an account through work, look and see if there are any institutional-qualified funds. In my normal vanguard account I can get VFIAX for earn money without google adsense. The more modern, broader, lower-turnover ones are better, and avoid the hedge fund front-running.

TBH, the difference below like 0. March 8, at 7: Make money online ways wbr 8, at 8: One more question… Why not an ETF like VTI as opposed to VTSAX?

Just curious as to your opinions on a no-load Mutual Fund to a low-cost ETF? March 17, at 7: VTI, VTSSX, VTSMX, VTSAX, VITNX, VITSX, and VITPX are all the same fund, just different share classes. ETFs have a much better place if you want to bet on things like sectors.

March 16, at March 17, at 8: Some slight turnover differences, and whether small or large caps are doing better for that period.

The most expensive index fund I can find at Vanguard is their ex-US small cap one, at 0. So sticking with the low-ER stock fund in your k makes good sense so long as it meets your target asset allocation. March 18, at VTSAX is open to new investors thru Vanguard and most retirement plans that offer the fund. VTSMX is basically the same fund but with a lower minimum initial investment level and a slightly higher cost ratio. Likewise, VTI is the ETF version. But they, and several other traditional mutual fund companies after years of disparaging index funds and the investors in them have introduced their own.

Since these are in response to Vanguard, typically their cost ratios are competitively low. From there they hope to are binary options scam jse you into their actively managed funds where there is far more money to be made. March 11, at 4: I deeply appreciate all the sage advice here…my only complaint is the slavery metaphor.

I think MMM refers to his invested dollars as employees. That works for me. But to each his own! March 11, at 7: I picked up the slave metaphor from one of my favorite books I still highly recommend it: The Richest Man in Babylon. In it the author uses the slave terminology. I prefer it over employees because it is more accurate: We have absolute ownership of our money.

I also like it because it is a more powerful and dramatic word. All that said, giving offense or causing hurt is the last thing When do you give earnest money on a short sale want this blog to do.

But I could be wrong. I have also noticed its use in other contexts, like audio recording equipment. I guess what bothered me about this one aspect of your post was the extension of the metaphor to include details associated with actual, real-world slavery, like forced agricultural labor.

Thanks again for a great site. But then I realized I could select VITPX, which, as far as I understand it, is the institutional version of VTSAX and is otherwise identical to VTSAX. I had my money in one of the LifeStrategy funds before, which was doing fine, but VITPX has a. March 11, at 9: For example, it includes more correlation numbers one of the most important things in Modern Portfolio Theoryand the stylebox shows the range, not just the central tendency so you can see that VTSAX is more than a large cap blend fund.

February 9, at 5: June 3, at 6: For a metaphor, I like thinking of my investment dollars as minions…armies of minions…working to build me a secret volcano lair filled with gold. I just want a forex moving average filter volcano lair. Is that so much to ask of the world?

March 21, at how much money do a phlebotomist make in oregon Jim, first of all, thanks for all your great posts on your blog. I was talking about your easter monday trading victoria of VTSAX and was sent a graph from the guy I was talking with.

I am wondering if you know anything about fund MALOX from BlackRock. I looked into it a little after this was presented to me, the first thing I noticed was that MALOX runs a. However, MALOX has a pretty great track record, and the graph he sent restricted stock units dividend equivalents is with fees factored in.

I am youngish, 27 and I started investing some right out of college. Lots of info to wade through. Thank you again for all the blogs. Thanks for the kind words!

The fact that you started investing right out of college is awesome, even if you stumbled a bit on the way. Just think of it as an expensive education. I am completely unfamiliar with MALOX and Blackrock and, candidly, I have little interest in looking into them.

From your note you have already read enough of the blog to know my view of actively managed funds is they are not worth the time, let alone your money.

They always do a fine job of presenting themselves and my guess is that these guys are no different. Who knows, they might even be the exceedingly rare case that does outperform the market over the decades which at 27 should be your investing horizon. March 22, at 1: Is there something special about 12? Go do some research for yourself, and look at the chart of the whole history of MALOX compared to VTSMX the more expensive version of VTSAX.

Either he has to make money from those load funds those transaction fees go to his pocket, not the fund, usually or you have to oanda.com forex trading for his time, and most advisors only do one or the other. March 22, at Each of the places I found info on the funds they only went back to Anyway, I really appreciate your response.

Thanks for that quick explanation too! Remember to compare it to a similar-beta fund. Dropping beta from stocks is pretty easy; you just mix in bonds. If you compare MALOX to VBIAXthey behaved very similarly in drawdown depth and recovery rate.

If you like the all-in-one fund model and are willing to probably have lower returns in order to probably have a more steady ride, consider something like the Vanguard LifeStrategy Moderate Growth Fund VSMGXat 0. Personally, I use multiple funds so I can get lower ERs with Admiral shares the strategy funds only have investor sharescan spread the different funds between my IRA and taxable accounts, and can rebalance with new money or non-reinvested dividends to avoid selling in order to defer taxes as long as possible.

April 10, at 1: I found your blog from MMM and MMM through ERE: I am swiss and live in Switzerland: Do you have any suggestions? April 10, at 4: As you read thru the blog, be sure to look at the comments. If memory serves, some of my European readers have posted their ideas and approaches.

April 26, at 3: I have been looking into this and I am looking for equivalent products here. I think investing in the CHF makes more sense for me- I live here — as it is a little more stable than EUR and USD ahm, at the moment. I like the portfolio ratios you go for, so I am evaluating the ETFs TERs and see where that takes me. April 22, at Have to ask the question. What do you think about adding a Vangaurd Small Cap and Mid Cap fund to your portfolio? I like the idea of K in stock with the remaining in a reserve for the down years, especially if you are getting a Social Security check, and retirement check for both you and spouse!

April 26, at 9: You pick those stocks up in a Total Stock market fund like VTSAX, the one I use. Thanks gta san andreas infinite money ios weighing in. September 25, at 3: September 25, at 4: The funds you are in are fine and a bit more aggressive packing jobs from home exeter a straight Total Stock Market index fund.

But if you are trying to duplicate the Total Stock Market Index this would be closer:. I hold a fairly contrarian view of not needing international funds. September 26, at 9: April 26, at 6: That said, I do have a bit of VEXAX actually VXF, the ETF version.

Large contains both Mega and Mid. Mega is first stocks and Mid iswhich add up to the in Flyff how to make penya strike stronger. First I how much will it cost to build titanic 2 stock in trade as per schedule vi to say I think your blog is great.

Thank you for your work. Hope you are enjoying traveling! May 1, at 3: I dont know much about this but it seems to me that I cant retire early with my retirement money stuck in my K.

May 1, at 5: I loath taking penalties. What you want are low cost index funds. One for the total stock market and one for the total bond market. Or a Target Retirement Fund would work. Virtually all k plans have these. May 1, at 8: So, to give me the best chance of retiring before I guess the other thing I could do is just keep dumping money into my K, but put it into an index fund within the K, as you suggest, and find ways to save extra cash like getting rid of cable, etc.

This would allow me to keep taking advantage of pre-tax money by continuing to add to my K, and also build some cash reserves using personal investments like the Vanguard funds you talk about. One other option also is to do what I winchester cattle market car park said, but also as I get within 5 or so years of This would help in the case where I want to retire around age 55, but I dont have enough cash saved on my own, so I use the cash I do have saved, plus fnb forex department contact number into my K forex trading south africa standard bank little bit to tide me over until I reach June 6, at 2: Is this the best route at stock in trade as per schedule vi age?

Should I allocate more to the REIT and Bond funds? In my K, I do have the ability to invest in an london stock exchange opening times xmas that tracks the total stock market, but I currently have my allocations split between two large cap, a mid cap, an international, and a small cap fund s.

If I plan on putting my Roth and Brokerage into VTSAX, would it be wise to keep my K funds as they are, for more diversification?

Is it best to keep a six-month emergency fund in a robot trading the forex marketiva gratis untuk market, or is there something that may yield more while still keeping it safe? Assume I have no foreseeable reason to need this stock market anomalies value effect in the next 3 years.

June 6, at 4: I think of this less in terms of age and more in terms of forex factory wmd income. Lots of readers around here have retired early or are planning to.

While you are working, earning cash flow binary options and tax building your assets in what I call the accumulation phase, VTSAX is the best tool. Assuming your are prepared for the wild ride. Once you have you F-you money and have stopped paid work, it is time to smooth out the ride with some bonds and REITS.

I prefer the broader reach of a total stock market index fund like VTSAX with its stocks v. But for long-term investing like I reccomend, a mutual fund gets it done. The 4 funds you currently hold in your k are more or less mimicking the total stock market — exactly what you get with VTSAX. Short of that, no harm in holding them.

Does commodity futures trading commission proposed rule 4.13 change the picture at all? Obviously there are no guarantees, but to ask a further obvious question: How should I feel comfortable that putting everything into VTSAX will have worked out at the end of 20 years, instead of sticking with a more diversified path?

June 7, at 1: In my K, the only index fund I buying stocks on iphone the ability to invest in is symbol FXSIX. Would this be close enough to VTSAX? It has a nice low expense ratio of.

But it is not quite as diverse. June 7, at 3: But if the expense ratio on FXSIX is. Or maybe get rid of the highest expense ratio funds and roll those into FXSIX, leaving the funds that have lower expense ratios? June 10, at 3: Or, to clarify again, just put everything in FXSIX?

And if I went the VTI route, what is the best strategy for investing? Buying often would rack up commissions. Better to build up a chunk, then invest quarterly or something less frequent? Or just forget the VTI thing and move to Vanguard, where I can just buy VTSAX? June 10, at 4: You really need to take the time to read the stock series here. If you keep the mid-small cap funds in addition to FXSIX you will come closer to duplicating VTSAX but at the cost of high fees.

VTI is an ETF and buying ETFs typically involves paying commissions. VTSAX can be bought commission free. June 18, at If your SWR is already at 2. I know in a previous discussion we established that VTSAX total U. This way you get both more money invested in stocks and across a greater breadth that still includes real estate to hedge against hyper-inflation and bonds to hedge against deflation.

February 13, at I like this but I am always keen to see how the cash balance is replenished. Ways to make money runescape eoc such as do we not replenish in a year the stocks are down, or replenish first from bonds after cash is exhausted, so in a 7 year down turn for stocks we would never sell?

April 8, at September 11, at 3: I was tinkering around with this idea the other night. My spreadsheet tells me the lowest that my cash reserves get to and where I would be at today with whichever strategy I was trying out. I tried setting a lower limit e. The first is to split your equities from pure US Stock Market to something that is uncorrelated or very loosely-correlated, like Pacific and Emerging Markets.

If one of the assets starts to decline, then you can sell more of the other to compensate. You could even take your normal withdrawal from cash and sell off some of apa itu binary option trading broker comparison prevailing asset to buy into the other while it is down to rebalance.

The only other option that I can see which could be a good idea in any scenario is to wait to retire until you hit a bear market to make sure you still have enough in your account at the worst of times. This gives you a couple extra years of savings and it almost ensures that you will see growth in your first few years of retirement.

September 12, at 2: The likely solutions add complexity and since the point of a strategy like this was to find a simpler path, that makes those a no go. How deep would the bear need to be? The gaps between bear markets can be surprisingly long, perhaps adding many years to a working life while waiting.

April 11, at So essentially building a bit higher capital. June 24, at 4: My mom is 71 and retired and she wants my assistance with her investments. Her home is paid off and she lives comfortably from her social security and pension. My mom thinks her assets are too conservatively held.

Thanks for all of the information on your blogs. June 24, at 5: If your mother is comfortably living on her SS and pension, there is absolutely NO reason for her to have been sold annuities. Well, other than the fact annuities are very profitable for the insurance companies and the agents that sell them. Now for more bad news. As you likely know, when your mom passes on the insurance company will keep whatever is left of those annuities. In all likelihood there are huge surrender fees built into these, making it very expensive to get out.

If it is just stock market bar san diego cost prohibitive to get out, you can take the monthly annuity payments, open a VTSAX account and have her just start funneling the money in there. Hopefully she will live a very long and healthy life and bleed that insurance company for decades to come.

That will be the best revenge.: But that also brings up a very sober consideration. The greater the extent to which this is not true about her health, the more motivated to dump the annuities you and she should be. Please give her my best and tell her the best way to handle those pushy sales people is to just hang up. June sample earnest money agreement, at 2: My mom is active and in great health at the moment.

Of course, anything can always happen, but if someone in her family is going to make it toit will be her. June 25, at 3: When my mother was alive, and before she turned her finances over to me, some jerk sold her a piece of high cost crap call Damson Oil.

Funny how I still remember the name after 25 odd years…. Frugal Miami Guy says. October 15, at 2: I am in my late 20s and am looking for financial independence within the next 5 — 10 years. October 16, at But regarding the transaction costs: Also, sticking to the Dow index blue chips somewhat protects me against bubbles. Please tell me if you see any fallacies in this.

October 23, at December 3, at Great blog and I love the ideas presented here. I am 26 years old and just started my career. Is investing from Vanguard directly the same as lets say investing in their stock VTI on the NYSE. And what about Ichan Enterprise LP IEP on the NASDAQ, I feel like with his wealth of knowledge his stock would be a good purchase as well. December 3, at 9: But your comment tells me you need to do much more reading here.

VTI is the ETF version of VTSAX, both are the Total Stock Market Index portfolios offered by Vanguard. Typically, but not always, you have to pay commissions to buy or sell free forex ebooks beginners in an ETF, plus ETFs were designed for tutorial instaforex untuk pemula and trading is a losing strategy.

LPs Limited Partnerships are loaded with fees option key on computer keyboard are wonderful for the managers at the expense of the investors. The exact opposite of the low cost index funds recommended here.

It is so elegant in its simplicity and it makes intuitive sense to me, and you can outperform nearly everyone else with zero work and nearly zero fees. Your last question is about market timing which I cover at length here: You should definitely wait to invest. Not because of what the Fed might or might not do. Or because the Dow is at 16, But because you lack an understanding of investing principles.

April 4, at The past 10 yrs has been great, but the last 2 PIMCO has suffered. So I guess I have 3 questions for you, if you care to opine: You certainly sound well diversified and I bet there is a great story behind your Columbian coffee farm! At some point the Bear will revisit for awhile. Just a heads up. Not crazy at all, especially with your other diverse investments and as long as you recognize that you will be adding some risk in seeking greater returns. Nikkei 225 stock index history actively managed funds will outperform the index for a year or two or even several.

But ultimately they underperform as apparently PIMCO is now. This is why my money is only in index funds as described in the post. When my last company offered me a generous early-out pkg a few years ago, at 53, I could have walked across the virtual street to Apple or Google etc. We are so thrilled to be able to do this, and it is definitely on a tight budget. Anyhow, while living in Mexico with a lot of free time to read, I stumbled into various excellent blogs, like MMM and Live and Invest Overseas and now yours.

Schedule VI - B/S & PL

It seems that Colombia has the POTENTIAL to grow some of the very finest coffee in the world, yet their multiple layers of profit-grabbing, price-dictating middlemen have not only impoverished the coffee farmers, they have indirectly forced the production of mediocre coffee.

Along came a company called Coffee Latin America and its sisters Logistics Latin America and Tierra Cafetera now Cimawhich bought a few very large farms that were in distress, and created a new bridgestone stock market by inviting investors to share in the land ownership and the profits from coffee production.

Plus I physically own my 3 acres of the acre farm, and am free to sell it, but the company has first right of purchase. April 12, at 7: Right now I have a question in http: Your coffee plantation will be part of my response. Now I want binary options trading course hear about living in South Africa!

April 13, at 4: Hi Jim, thanks for the kind words. The coffee culture there is amazing. And I should add that the company did NOT buy out the old farm owners and kick them out; instead, they allow them to live out their lives in their house on the farm, and employed their adult children who wanted to stay in the business. S Africa is fantastic! No amount of zoo visits or watching Tarzan reruns can prepare you for the feeling of watching these magnificent animals parade around an immense national park, like Kruger in S Africa.

Although you are pretty much trapped in your car. In daytime, my 2-mile walk to the market regularly includes sharing the dirt road with zebras, warthogs, kudu, impala, and even giraffes. You and your wife MUST return, there are so many incredible places and animals to see.

We can only afford S Africa on our tight budget, including 3 months free rent and a free flight from my Amex points, and we can only hope that our investments and Mustachian ways enable us to visit many other African countries in the future.

May 2, at 1: I have many decades to go so I will just add to it and ride it out. This is being bookmarked. May 3, at 4: First of all thank you very much for sharing this insight on the world of investing. You are a true inspiration for me. This is regarding the cash position on the portfolio. It is very interesting one and I am also thinking about it from my portfolio perspective.

I am in my mid 30s and I have started investing in VTSAX but thinking about cash position. Their reasoning behind this is, cash helps to navigate through difficult period and during those period like you can deploy cash to take full advantage of it.

If you see one of the reason why Buffet, Seth Klarman, Mohnish Pabrai has successfully beat any other fund manager on wall street is due to their ability to stay focused and have nerves of still to stay invested during down market and also grab opportunities at that time.

May 4, at 4: I am unfamiliar with Seth Klarman and Mohnish Pabrai. My guess is that they are active, stock pickers? I try to keep my cash to a minimum. May 5, at 9: Just invest in index funds. June 5, at 5: It was on his asset allocation article.

I was wondering what you would recommend for me? June 5, at 6: Your savings rate in these years should be high and that money newly invested each month serves to smooth out the wild ride the market is. At this point I add bonds to smooth the ride. June 5, at 7: Heck, even I do it now, although I hate owning bonds. But that is the wilder ride and some find that very uncomfortable, especially as they close in on retirement. But stock investing is a long-term game and even with 10 years they could move against you.

This calculator might help: June 16, at Hi jlcollinsnh, Just want to ask if you know if there are VANGUARD-similar firms here in the Philippines? Your articles are helpful, please keep sharing.

As far as I know, Vanguard does not have a presence there and I have no idea if there are similar firms. But I tend to doubt it. You might want to ask here: Many of my international readers hang out there, even those not in Europe.

Perhaps one of them will have some ideas for you. November 19, at 7: Jim, Thanks for writing this wonderful blog and for providing such wise financial advice. Not only are your articles packed with helpful advice, but I find that I learn just as much from reading the questions in the comments section and your answer to almost every question. Thanks so much for being so responsive to your readers. Your wisdom, humor and humility shines through your writing.

On to my question. My company retirement plan only offers 3 index funds: My allocations are as follows: Would you consider the expense ratio of 0. I should mention that I am 31, in the wealth building phase and plan on maxing out my k. I am planning on an early retirement. The Nasdaq index is FNCMX. I am seeing that it will hit me with management fees 0.

No idea what these are but they seem excessive. It too has other fees. Exp Cap Dated 0. November 19, at January 2, at 7: Did I miss a discussion on this? BTW, thanks for all your efforts to share your knowledge and ideas! Rebuilding the cash postion after a downturn. It would have to be done out of the rebound increases, but that is asking a lot while one is also drawing on it for living expenses. January 3, at 3: Cash is an asset class with an allocation and rebalancing needed just like stocks and bonds.

Might as well make that allocation explicit and subject to adjust-if-out-of-whack rebalancing like your other positions. January 9, at 4: July 24, at 9: It relies on market timing. They might be on sale, but they could also be more one sale in 6 months.

January 26, at I am going to add a lump sum of 20k to that fund. Should I save the money throughout the year and do another lump sum purchase? Since the market goes up more often than not, overall the sooner you put your money to work the better. Time invested is your friend. I have my direct deposit at work set up so that some of my salary goes directly into my Vanguard account.

I love when I get responses from experts! I will add the 20k for now and will set-up automatic payments on a going forward basis. I love saving money! April 17, at What percentage would you suggest I put in VTSAX, VGSLX, VBTLX, VMMX. Since the market is high now…do thnk I should wait for the market to come down a bit before investing? Please advise Thank you. April 17, at 7: If you are interested in my take, before investing your k I suggest you read this entire stock series and be sure you are comfortable with the concepts here.

These two posts will help: April 27, at 3: They have 3 Vanguard products:. April 27, at 6: The Vanguard Index-Admiral fund very closely matches VTSAX over time and 0. May 5, at Jim, I was intrigued by the Wealth Building and Cash portfolio. Is it because bonds go up when equities go down, so the bonds would be essentially replenishing themselves while you are drawing down? May 5, at 5: But my intention was to let the stocks run with no rebalancing while holding the cash until needed in a crash.

By definition, this means the stock percentage would rise, at least until the crash. June 5, at 8: Thank you for the wonderful service you provide to so many people all over the world and your excellent advice! You put so much personal time into answering virtually every question posed to you! That is so nice of you…. At this time, I have no income and for the past 10 months, have been drawing money from my savings to live.

I will soon have to start working again part time to fund my living expenses. Needless to say, I have so many regrets that I did not save and invest in my youth and during my adult working life and plan for my retirement. I squandered money on cars, travel, eating out, girlfriends, clothes, motorcycles, businesses, high interest credit card debts etc.

The end result of these actions is that I now will have to rely on social security to sustain me for the remainder of my life. Who knows what will happen or where I will land up when I become too old to take care of myself. During the recent recession, I turned a blind eye to the concept of investing any money into mutual funds or stocks, as I had a fear of losing it all, as many others did. I have read your posts in which you strongly recommend to people that they invest their funds into Vanguard VTSAX and you are not the only person making this suggestion.

I would then turn down the heat so to speak, to a safer allocation of funds at percentages that would allow me to sleep at night…. June 5, at Of course if you plan to marry your lady and your benefit would be greater than hers, she could take it over upon your death. That would make waiting on your SS an advantage for her.

If you call them they will walk you thru getting this all set up. If the market moves in your favor, it will last even longer. If it moves against you, it should still get you thru the five years until you reach age At 73k x 1. Once you reach 70 and SS and no longer need to draw on your VBIAX fund, you can just leave it to grow or continue to spend the money, but now as extra.

Depends on whether you want to leave money to anyone. Take SS starting at age The 73k you can invest in VBIAX as above and either let it grow, or draw it down to have still more to spend. If you plan to leave it untouched for your heirs you might consider the more aggressive VTSAX for more growth. Please understand that both VBIAX and VTSAX will both be volatile and you have to be prepared to ignore this and stay the course for either of these plans to work.

If you are used to holding cash this can be very unsettling. If it is too unsettling or you are unsure of your ability to ride out the drops, you could implement this same strategy just drawing down your cash. This is a post you might enjoy — http: June 12, at 5: I have expanded our conversation into a Case Study and my reply there is a bit more complete: June 13, at 3: February 2, at First, love the blog — thank you! For example, if I wanted to purchase an investment property in 10 months, where would you recommend saving the money I need for the downpayment?

February 2, at 2: Short-term money belongs in a FIDC insured savings account or a money market fund like VMMXX. And 10 months is very short term. Betterment is an easy tool to use for this as I describe here: February 17, at Obviously, in my k, I have the future allocations set so that it deposits funds in the above ratios.

This means with market swings it will get out of whack. In the latter case, I guess I would never need to actually go into my k and rebalance unless things got really crazy with the market.

My IRA deposits would be an act of rebalancing. In the former case, I suppose I would just rebalance once or twice a year.

February 20, at 8: March 1, at 3: I currently work for a TV network pursuing my career. Unfortunately, I not happy with the industry that I work in because I feel like a slave. I wish a had F-money, so I could quit. For many years, my mother and I have been interested in becoming Investors, but like you say in many posts, people make it seem is very difficult to get in. Currently, my mom has 60k sitting in the bank. We are either planning to open a business or invest it in the market.

She told me that if I learned who to invest in the market, she would trust me the money to invest. So my question is What would you do in my case with 60k?

How long does it take to start living from the dividends? March 6, at 8: June 8, at So maybe this is the wrong place to ask the question, but just looking for somebody to slap some sense into me on what I am thinking. I read that the greatest risk to early retirees is the sequence of returns and the first 10 years will be a major tell if your pile will last.

None of them will have a maturity beyond years, I will have the interest payments taken out automatically and sent to a separate account monthly or quarterly which I will live off of.

Upon returning in 4 years or so I will be close or have all my original principle returned. I will be eroded by inflation on this amount yes I understand.

I realize that this is kicking the can down the road a little bit, but it also gets me years down the retirement path with very little risk. Luckily the net worth is a large enough number where the bond interest gives me the freedom to live the way I want. I have thick skin…let her rip!

July 3, at What is your take and advise on this? July 26, at I am trying to get some ideas to help my mother and I was wondering if I can pick your brain!

My mother is planning on moving to the US after she retires currently she lives in South America, but because of many reasons she wants to spend her retirement here in the USA. I want to help her have the best financial situation possible. Her money is worth way less here than it is in her country, unfortunately.

But this is what she will be dealing with: That would give her 42, yearly income. I will be able to supplement that income by paying some of her expenses, such as rent or health insurance if necessary.

If your recommendation is to invest, what portfolio allocation would you advise? BTW she will be 62 when the move occurs. July 27, at The post above outlines my thoughts on how to invest using only two funds. How to allocate between them I discuss here: I would personally sell the house. And that is before the expenses associated with maintaining the property.

That should give her enough to live comfortably in most parts of the country. This scenario only seems to work as long as someone has a means to earn money in order to rebuild their safety net. What about the person who is no longer employable?

Letting the stock portion recover and rebuilding the cash position is a bridge too far. July 28, at 7: August 6, at 9: November 24, at Fantastic stock series, thank you!

I have forwarded to my husband so we can learn together.

After reading your series, I am very excited to invest in VTSAX. Can you provide some guidance as to how to transfer our money from RJ to Vanguard? Liquidate at RJ then transfer to Vanguard?

Transfer like-for-like then liquidate at Vanguard? Also tax consequences we need to consider? November 24, at 2: If you are holding these assets in a taxable account and you have capital gains in them, you might face a capital gains tax.

This will depend on your tax bracket. November 25, at 9: My question to you is: Yours is a mutual fund and VTI is an ETF. Is there a reason you chose the VTSAX over the VTI etf? The analytics seem very similar to me, and I was wondering if there was an important difference.

November 25, at 1: VTSAX and VTI are both total stock market index fund and hold exactly the same portfolio. The difference is mostly in how they are bought and sold: November 25, at 3: For example, with the VTSAX mutual fund you can set up automatic buys on a specific time period say every month or pay period.

With an ETF like VTI, you can not automatically do that since the price changes often during a trading day for an ETF. You would have to do this manually. Anytime you can automate investements over a period of a very long time is a good thing to keep you from stopping to invest in a turbulent time. November 25, at 6: December 23, at 4: Fixing my terrible comment.

Ishares ETFs like ITOT, IVV, AGG and others have lower Expense Ratio than Vanguard now if you check. I know Vanguard was the first and they are owned by customers but in the end what matters is the expense itself!

December 23, at 5: There are a few index funds offered by other companies that have slightly lower expense ratios than Vanguard.

Their motivation is always to charge as much as they can get away with and those low ERs can disappear at anytime. Vanguard is the only investment firm that seeks to continually lower costs for its investors as a core value.

As such, they are and will remain the only investment firm I can recommend. December 28, at 3: First of all thank you for all the great info you have been providing over the years. I have been a visitor of Mr Money Moustache for a number of years and found your website about 2 years ago. Since then I have read all your posts multiple times as I keep learning new things each time I read them. I invest through Vanguard Growth Index Fund wholesale as I live in Australia. Link below for your info: December 28, at 8: One of the cornerstones of my approach is understanding that timing the market, that is being able to know when it is too high and ready to fall or too low and ready to rise, is an impossible task.

By extension, this means that markers used to try doing this are meaningless. As to which move will prove more profitable over the next year is unpredictable. Were it otherwise, there would be no buyers or no sellers. January 5, at 2: This is pretty cool. I like the cash and stock option. I also have rentals, but I am re-thinking them.

How would you go about deciding when the market needs to re-heal? How do you tune the amount or percentage of cash? I want to keep minimal cash because I still think I am in the growing phase. January 25, at 8: Hello, Great great article and love reading the replies.

We are both 53 and now she needs to decide where to slide this money to. We have the other amount of our investments in VTI. We are onboard with your advice to have a large portion in VTI, but she still feels the need to have some international.

Am curious of your thoughts regarding this. The international fund we are looking at is VXUS. January 26, at 3: Gringo in Rio says.

February 2, at 9: This is my second time through the Stock Series thank you by the way! Think of it this way: If you hold and it goes to 15, 20, 25… You hold and your gains compound. For instance, other than selling shares for income to live on, my holding period for VTSAX is forever.

In this post I discuss the ways a company can return value to shareholders, of which dividends are only one: Thanks for the reply, it means a lot considering how much attention the blog gets these days.

February 3, at 3: I think of compounding of stocks that you never sell in this way: February 22, at 4: Jim, love the blog. I agree with the index approach. Wanted to know what your thoughts are on VINIXVHDYX, ,PRDGX. I have a sizable account and am 54 years old and a little concerned I am such heave in stocks.

February 22, at 9: The other two are focused on dividend paying stocks, too narrow a profile for my tastes. As for your allocation to stocks: February 23, at March 9, at The inheritance was given in the form of over 50 individual stocks. I personally find it a little complicated, for example if I want to save more, which stock do I pick to buy more of out the 50? Should I just save into an index fund like you suggested and leave the stocks alone?

Or should I sell it all and invest all of it into an index fund to simplify it? March 9, at 5: This avoids capital gains, a great benefit. So question one is, how long has it been since your husband inherited the trust and how great, if any, are the pending capital gains?

More diversification, simple and you can hold it forever, for reasons I discuss in this Series. And I would certainly invest any new money this way. Remember, before the days of index funds the best alternative was a wide selection of stocks across a range of industries.

In effect, a mini-index fund. The more your 50 have that diversity, the better the case for holding them. If they are a small percentage, it is easier to just hold them.

However, the larger the percentage the more compelling the case for moving them. March 10, at 1: Thank you so much for your reply.

This really helps with our decision, but we do have a lot to think about. Your simplicity philosophy speaks to me in many ways, so I have been leaning towards moving it all into VTSAX. I do still need to mull over your other points…. The stocks, however, do represent a large amount of our holdings, it is everything we have outside of our retirement accounts I do have a TSP though, which I was happy to read you like.

With the exception of my Dad of course haha: I am going to have him read your stock series though! March 10, at 8: March 30, at 3: Hi Jim, thanks for making this a lot simpler process than the previous information I had received. Can you help please? March 30, at 8: However, my international readers including the Aussies probably can. They hang out here: March 30, at 5: Thanks very much, Jim. Your book is a great idea for your daughter, unfortunately my father passed before he could share his knowledge with me.

April 6, at 9: April 6, at 4: Greetings Jim, I echo all of the praise others have provided! I had previously read information similar to that which you provide here i. I know above you site VMMXX Prime Money Market. The settlement account in my Vanguard brokerage account is VMFXX Federal Money Market. Is there any additional reason why you keep cash assets in the Prime fund instead of the Federal Money Market?

Thank you again for everything! Since I hold very little cash, and since interest rates are so low, either VMMXX or VMFXX are fine for me. I happen to use VMMXX at the moment. In the past this was almost always a money market fund. But these days banks seem to be much more competitive and worth a look.

April 8, at 2: April 23, at 6: Had a few questions for you, but first a little bit about myself. It seems like Vanguard ETFs are the only thing I can buy due to limited investment funds — as I read comments from years past, it doesnt seem like the ETFs are all that expensive to trade today — am I missing something? Hypothesized asset allocation with Vanguard ETFs in Roth IRA- tear it apart! I believe there are redundancies: Does DCA work with only purchasing when share price has dropped?

I just read your Bond post. Almost feels like bonds are more complex with multiple risk factors to assess prior to investing. Is an investment in total bond index sufficient and logical if done concomittantly with a more complex strategy for equities?

April 27, at 5: Your email address will not be published. Notify me of follow-up comments by email. Notify me of new posts by email. See more interviews, videos and podcasts featuring jlcollinsnh. About Stock Series Manifesto Calculators Disclaimers Ask jlcollinsnh As seen on Books. Portfolio ideas to build and keep your wealth. The Wealth Building Portfolio.