For the Younger Investor..

1. You are going to have a lot more bills ahead of you ( Own a Home, Marriage, Kids, College, Weddings) and tying up anykind of $ in investments and your going to be tapping it in the near future, until you get (a) established in a Decent Job, (b) get a Home ( #1 Priority Investment, Since it ave a 7% apy -Tax Free Rtn and a 15% apy Growth Factor beating Just about everykind of Index on the Planet =Doubling every 10 yrs)

2. Have Credit Card Bills? ( Who Doesn't) Pay them Down and keep  Bal. Under  $1,000/mo or less. And do you have equal to at least 6 mos Of equal to your Monthly Bills Sitting in a MMkt?  If not, Don't proceed to the Next Steps..You ain't Ready yet..

3. If your age 25 ? By age 67? Your going to be needing At Least $500k in savings + SS to afford to retire and that's only at the Lower Income scale of Retirement..( @ $40k yr now - $22 SS = $18k from Savings @ 4% = $450k req'd, @ 3% Inflation, Doubles Every 24 yrs) so you best be saving at Least  $5-$10k Yr my friend!

4. Owing a Home is a far better first investment choice..It grows tax Free, not tax exempt.( 1st $500k profit is not taxable ) and by the time you sell it? that will be more like the 1st $1 million..and most Condo's/Twnhmes/SF Homes have ave. a 7% apy. past 20 yrs.. Tax Free! Not Tax Deferred..= 9%+, far better than the S&P Index , let alone Any kind of Bonds investments.(which are enventually taxable ) Buy A Condo/Loft/Townhome/SFH and Only a 15 yr Mort.

5. 9 out of 10 Do not Know about Investing and LOOSE $.."The Odds/Force are Against You" ..Just read this article on a "Whistle Blower about the Investment Industry" > 11 reasons passive investors let Wall Street steal their money - MarketWatch

6."I am a Strong Advocate of AMBF's"> The Market is in turmoil now..You want to Loose 20--50% of your $?  Did you Know that a simple Balanced Portfolio of btwn 50/50 to 60/40 Mix Beat everykind of other Port. for the past 30 yrs! And 'AMBF's ( Active Managed Balance Funds) Beat 98.4% of all other Portfolio's and Indexes for the past 8 & 10 yrs and Beyond!   I used to Believe Owing All kinds of Funds was the way to make $, but I switched to AMBF's in 1998-1999 and it not only saved My Retirement $ from Loosing over -30% btwn 2000-2002' but Made me $ in the Process and Ended up having More than I needed to Retire Early! (at age 55  thank you very much ! )

Where do you put your Retirement $ First? ( here's what I Did ) 

1. Into your Home.. get it paid off in 15 yrs. then sell it and get a bigger place and get it paid off by Retirement time, then downsize for Retirement, invest the rest into your Retirement Portfolio &  most  will be tax free $ going in it ! Not Tax Deferred either. ( in 2004,  I had over $200k left over, after buying my Retirement Home to add to my Retirement Port. & Doubling it ! )

2. AMBF's as your "Primary" Investment ( min. 80% of your $ ) and go play with the other 20% to see if you can do better... ( FPACX, OAKBX, PRWCX,PRPFX and add a Reit, like CGMRX ) if you can't get them in a Company #401k plan? Ask your Employer to Get them...  or Invest Min. in whatever Nearest 60/40 Fund they Do have and put the rest of your $ into a ROTH IRA.  ( just go back and see how they've done for the past 8 & 10 yrs vs Anyother Funds  or Combination of Funds/Portfolio's )

3. Want to Try your Luck with the other 20%? Go Play with Funds like CGMFX,FLVCX,FAIRX and some Sector country Funds Like PRLAX.( And how did they not only do in the last Bull Yrs of 03-07, but look what they did in the last Bear Yrs of 00-02' ! ) and/or if got a #401k? Load that Puppy Up ! But after you got your Home and a 15 yr Mort. $ taken out first.

In the meantime? You can also Start your Education on Investing by (a) Get the following books.. and (b) Ck out the Sites and don't go investing  Any $ until you complete them all..( should take about the Summer if not a Yr ) But, Keep In Mind? All of these Guys Based their Ways On the PAST and most Before the Advent of the PC/Internet and Wising up the Average Investor and Was back when These Kinds of guys and only a Few Big Fund Families and Brokerage Houses Controlled the Markets!

I think a lot of their ways are now History and won't work as well in the 21st Century and Beyond..There are just So many thousands more investing now and making the markets far more Volatile..( and some have Hidden Agenda's..Like Bogle and other Index Advocates, since they made most of their $ from Advocating them,selling Books and  getting Big Salaries and not actually making their Millions from investing their own $ into them or AFTER they made enough $ from their Daytime Jobs/Careers ) and Most Investors Haven't Got a Chance! The Big Boys/Brokers have the Inside Information and We're just along for the Ride.." It Takes a Pro' to Beat a Pro'...

1) Common Sense on Mutual Funds, by John Bogle and Peter Bernstein
2) Bogle on Mutual Funds by John Bogle.
3) The Four Pillars of Investing, by William Bernstein
4) Winning the Loser's Game, by Charles D. Ellis
5) What Wall Street Doesn't Want You To Know, by Larry Swedroe
6) Asset Allocation, by Roger Gibson
7) Stocks for the Long Run, by Jeremy Siegel
8) Jonathan Clements's book
9) M*'s Guide to Mutual Funds
10) The Informed Investor by Frank Armstrong III.
11) A Random Walk Down Wall Street, by Burton G. Malkiel.
12) Yes, You can still retire comfortably , by Ben Stein and Phil DeMuth
13) Trade Like Warren Buffett                                                                                                               14) Perspectives on Investing                                                                                                              15) Pabrai also has a new book, The Dhandho Investor ( "Endeavors that create wealth”.)

Sites to  Ck out:

Morningstar: Stocks, Mutual Funds, and Investing( ck out bottom of the page for Learning about the different Types of Investing.MF's, stocks & Bonds )

Bogleheads Investing Advice and Info

And when all is said an done?  Other than Putting $ into your Home ( and maybe a Rental Property or 2 ) You will probably find out that you'll be far better off just owing some Balanced funds and Investing Equally in them,  such as FPACX,LAALX, OAKBX, PRWCX and/or  PRPFX, and add a Reit like CGMRX and A Growth Fund Like FAIRX ( ave 15% past 8 yrs ) ,  seeing as the odds of you doing anybetter   is about 20-1  against you using Index funds or anyother balanced portfolios. Why? Just read the article in #5..

And Don't take my word for all this stuff !, just set up a M* Portfolio of these Funds, Invested  $10k Equally and (a)  do a past 5,8 and 10 yrs on it.. and (b) Track them from now on and use them for comparisons vs any other kind of Ports you want to look into investing into ( or are Recommended to you by anyone) There will be better one's that come alone, but won't Last...Not for the Longer term.. Hope you Learn from My Mistakes of chasing around and Do Better than I and 93% of the others have!

And If and When your Wife  Divorces you and takes all your $! + $800/mo for child support Plus Another $50k for each kid to go to college, that will end up dropping out of !  Just plan on living in a Trailer Park in Fla...when you have to Retire    (LOL )

Good Luck to you!

Any investment-related content of this message is intended strictly for informational and educational purposes. Such content is not based on knowledge of any reader's individual needs or circumstances.

Individuals should adhere to M* recommendations of always be Skeptical  of others information . I am Biased towards Owing a Port. of Balanced  & Reit Funds for myself as well as for the Vast Majority of Investors. Of course past performance will not Guarantee the Future, but It sure has Improved My odds for me.. and Saved My Butt as well!

 

Dennis @DKP50@aol.com