Posted 10/13/2021 17:48 (#9267214 - in reply to #9267145) Subject: RE: Where does a young guy start investing money?
West of Lincoln a little bit
get familiar with bogleheads.org -- simple investing for all. Their wiki pages have instructions on how to create a super simple investment plan that takes no effort and you do not need to pay a money manager.
You want simple investing. Set and forget. Don't listen to the noise about the economy or the state of things. There's always a crisis, the media insists on it. There will be up times and down times. Just keep adding money continuously and you'll see growth. Do you think the stock market will be LOWER when you retire than it is today? If yes, avoid it. If no, get your money working for you and check on it each decade.
Do a 401k first up to the company match.
Then do a Roth IRA to the annual limit ($6000) (I recommend one of the big brokerages like Fidelity, vanguard, or schwab)
then back to the 401k up to the annual limit ($19,500)
then open a taxable brokerage account to add whatever extra you want (this can be accessed anytime)
If you're a young guy you have 40-50 years+ of investing, so do all index stock funds. sp500 index fund or a total market index fund. or a target date fund if you want a little bonds and really don't understand investing. Age minus 10 or 20 in bonds is a good idea as you get older. So once you hit 40 you could have 70-80% in stock funds, 20-30% in bond funds. Bonds don't return squat right now, but it helps keep your balance stable during a stock downturn. Also, don't look at the balances. Just add, and check it in 10 years to see what you got. Young guys don't really need bond funds, you've got time on your side and can afford a little market drop once in a while so general consensus is for you to stick with stock funds (index funds). In fact you're better off if the market does drop so you can add more shares at lower prices and it'll have all those decades to grow.
If your 401k choices are poor, pick the LOWEST COST fund you can. Fees/costs will kill your returns. That's why index funds are so great, fees are super low. And the vast majority of managed funds cannot beat their comparative index over time anyway, so why pay the fees to under perform?
Keep adding. By the time you retire you'll likely be a millionaire many times over.