- quote -

Depends on your time horizon. If you need the money in the near term then
you shouldn't be investing it in index funds, you should be putting it in
a savings account. If you're investing for the long term (and our Marine
is only 24 years old so he's got lots of time) you don't care that
interest rates will rise and the net asset value of bond funds will
decline over the next few years. Waiting "3-5 years before getting into
bonds" is market timing and that's never a good idea for a long term
investor.

Vanguard has an interesting article on this up on their web site. Grossly
oversimplied, they recommend looking at the average DURATION of a bond
fund. (NOT the maturity, the DURATION.) If you're time horizon is
*greater* than the fund's duration, the folks at Vanguard explain that
rising rates are actually BETTER for you. Just checked the Vanguard web
site and I see that the average duration of their Total Bond Market Index
Fund is 4.8 years. That's obviously WAY shorter than our Marine's ~35 year
time horizon. Indeed, if he holds that fund in a taxable account he might
be pleased to see that come 2039 he has a nice long term capital gain on
the shares he purchases in the next few years at a depressed NAV.

pmb[at]his.com (Paul Michael Brown) wrote in message news:<pmb-2606042234490001[at]max1ka-46.his.com> ...

- quote -

If we assume that interest rates will be going up over the
next couple of years, one would expect bonds to go
down in value during that period. If one is comfortable with
that assumption, would it still make sense to invest in a bond
fund at this time, or would it make sense to wait 3-5 years
before getting into bonds?

Anoop

- quote -

That's why you should buy a very basic book on investing. The "For
Dummies" series is good. But I'm sure lots of people have their favorite
books. In the meanwhile, some gouge:

An "index fund" is a "mutual fund" that is designed to duplicate the
performance of some index. There are numerous indexes, some for stocks,
some for bonds, some for commodities, some for different industries (or
"sectors"). For the clueless newbie investor, the only indexes you need to
worry about (IMHO) are:

Wilshire 5000 -- This is an index of stocks (aka "equities") that is a
good proxy for the U.S. stock market.

EAFE -- This is an index of stocks that is a good proxy for the biggest
and most developed nations outside the U.S. (EAFE stands for Europe,
Australasia and the Far East.) This index contains stock of big companies
based outside the United States, like Nokia and Toyota.

The Lehman Brothers Aggregate Bond Index - This is an index of bonds (aka
"fixed income securities") that is a good proxy for the entire U.S. bond
market. It contains corporate bonds, govt bonds, mortgage-backed bonds and
lots of other fixed income securities.)

- quote -

I realize that everybody will have their own advice, but here's mine:

First, pay all all your debts. Pay for your tuition out of cash and avoid
student loans if possible. Second, figure out how much it would cost you
to live for six months if you didn't have any money coming in. Then save
up that amount in a savings account at your bank or credit union. (By the
way, the Navy Federal Credit Union is excellent and as a former Marine you
can open an account there.) It doesn't matter how little interest you make
on this account. It's more important that it be safe and easy to get to in
an emergency.

Third, start to invest in index funds that track the three indexes listed
above. All of the major mutual fund companies will have index funds that
track those indexes. I'm a Vanguard customer, so I'll recommend their
Total Stock Market Index Fund, which tracks the Wilshire 5000. The
"symbol" or abbreviation for that fund is VTSMX. For the EAFE, Vanguard
offers the Developed Markets Index Fund (VDMIX). And for the Aggregate
Bond Index, Vanguard offers the Total Bond Market Index Fund (VBMFX).

How much you invest in each fund is called your "asset allocation." There
are numerous theories on asset allocation. But for somebody who is 24
years old, I'd recommend 60 percent in the Wilshire 5000, 20 percent in
the EAFE and 20 percent in the Lehman Brothers Aggregate Bond Index. Let's
say you can invest $300 per month. You'd put $180 in the VTSMX, $60 in the
VDMIX and $60 in the VBMFX. If you go to the Vanguard.com you can set this
up to be done automatically and electronically.

That's a key point. You want to invest REGULARLY -- as in every two weeks
or every month, NO MATTER WHAT THE MARKETS ARE DOING. This is called
"dollar cost averaging" and it's a very smart way to go. Investing
sporadically because you have a hunch about how the markets are going to
behave is called "market timing" and it's stupid. Finally, every six
months or so check to see if your asset allocation is at 60/20/20. If it's
not, transfer money between funds or allocate your contributions
differently to make up the difference. This is called "rebalancing" and if
you're good about it you'll be buying low and selling high.

Finally, when your'e old and rich take me for a cruise on your yacht.

"John A. Weeks III" <john[at]johnweeks.com> writes:
- quote -

This comes up here regularly. Kiyosaki and his plans on
how one gets rich are garbage. See
http://www.johntreed.com/Kiyosaki.html

However, there is something to be said about "inspirational"
reading material. While the detailed plan on how to get
rich might be worthless, some of the big picture stuff
is often helpful in motivating folks in the first place.

Whether one invests in real estate or other things, the
notion of living below one's means, saving, investing,
learning, getting rid of expensive debts, etc - all are
pretty second-nature to those of us who've been immersed
in this for years. For someone just starting out, though,
a kick in the pants about it is very helpful - some
inspiration that this stuff all actually works, that there's
a value to it, etc.

Now, Kiyosaki should probably be avoided by most folks
in general, though some folks who've never read anything
else might find his work to be an inspiration to go and
actually learn from more useful authors. For those folks,
we regularly list suggested beginners books here on
misc.invest.financial-plan.

For folks who haven't gotten up to details about how
to invest, but are still needing the beginning spark-
the inspirational book - we might also recommend a few
of those, and different takes on that work for different
people. For example, Your Money or Your Life really
works for some folks, but not for others (and, of course,
again, the investment suggestions in there are _very_
questionable - all treasuries!). Or, perhaps,
the Wealthy Barber (simplistic - "invest in mutual funds!" -
but an easy read). Or, maybe, The Richest Man in Babylon -
which doesn't tell you anything useful about actual investments.

For folks who have already been inspired to go and
learn about investments and how to actually pull this
stuff off, I recommend Eric Tyson's "For Dummies" books -
"Personal Finance for Dummies" and "Investing for Dummies".
("Mutual Funds for Dummies" rehashes material from those
other two).

- quote -

--
Plain Bread alone for e-mail, thanks. The rest gets trashed.
No HTML in E-Mail! -- http://www.expita.com/nomime.html
Are you posting responses that are easy for others to follow?
http://www.greenend.org.uk/rjk/2000/06/14/quoting

In article
<e35e2fdb354d3f045a4d0dbd3cee8611[at]localhost.talkaboutinvestments.com> ,
milehighsecurity <ryan[at]milehighsecurity.com> wrote:

- quote -

In reading that book, you would think that Kiyosaki is some kind of
real estate investing guru. The fact is that he isn't. He made
the bulk of his money scamming people in Amway and other mulit-level
marketing schemes. Congradulations on falling into the trap. Post
back to the group when you are ready to open your eyes and let go
of the mind control stuff.

-john-

--
================================================== ==================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ==================

Carlton,

Thanks for the Link information

John,

I will be making a trip to the bookstore this weekend and can't wait to
get deep into this information. Some people I talk to say investments..
blaaaa . I say why the hell not. I'm young but I'll be a worth a millon
dollors long before you buying assets that make money for me insted of
buying liability's that make me spend more money on something that won't
work for me. About two weeks ago I finished reading "Rich Dad - Poor Dad
by Rober T Kiyosaki" and it opened my eyes up pritty big.

Thanks

Ryan

Perry:
A great site to start learning about investing is:

http://www.fool.com/index

There are a ton on investing 101 type articles, and information.

Carlton D. Taylor

All opinions and recommendations expressed are personal, and do not
represent those of any institution, or business. Furthermore, my opinions
and recommendations carry neither an implied nor explicit warranty.

In article
<3b2ae9227c08091de4673ff6511aa461[at]localhost.talkaboutinvestments.com> ,
milehighsecurity <ryan[at]milehighsecurity.com> wrote:

- quote -

Being in school, the last thing you probably want is yet another
book to read. However, I would suggest the Investing For Dummies
book as a good place to get started. I am not suggesting that
you are dumb or ignorant. In fact, you are far from that just
based on your willingness to ask and learn. Rather, the dummies
book just happens to be very well written, and the author, Eric
Tyson, does a great presentation of the topic. Another book
that I like is Andrew Tobias' The Only Investment Guide You'll
Ever Need. Suze Orman is pretty popular right now, but I'd
hold off using her as a first source given that she tends to
be a little wordy and self-absorbed.

-john-

--
================================================== ==================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ==================

"milehighsecurity" <ryan[at]milehighsecurity.com> wrote in message

- quote -


http://www.mfea.com/GettingStarted/default.asp

John,

I totally agree with you. All I have done with the is opened an account
and like you had said I found out that you do not own the stock. I know
that learning is half the battle and when it comes to all these terms like
index funds etc. I get lost. A little backround on myself. I got out the
Marine Corps about 1 year ago and have been going to school ever since.
I'm 24 and know very little about investing. Going back to my orginal
post, where is a place that I can get some entry level backround on
investing. I receive around 205.00$ per month from the military for the
rest of my life and seeing how I'm 24, that adds up to quite a bit of
money and I would like to think that the best way would be to invest.
Look foward to hearing back from you..

R/S

Ryan

In article
<5adee51a407ac0541f31fb71b0c8e82d[at]localhost.talkaboutinvestments.com> ,
milehighsecurity <ryan[at]milehighsecurity.com> wrote:

- quote -

As I understand it, sharebuilder lets you buy fractions of stock.
You don't actually own the stock, you have ownership in the company
that owns the stock. In my opinion, this is an iffy way to park
your money, and investing in individual stocks is not an efficient
way to invest in general. Finally, the golden rule of investing
is never to invest in something that you do not fully understand.
Since you say you don't understand it, you should not be giving them
your money, even if it was the best thing under the sun.

I'd rather see you open an investment account and purchase no load
low expense index funds using systematic investment. Most of the
large fund families offer this. If you commit to having the money
drafted from a checking account, they will deal with monthly
investments as low as $25 in some cases. In my opinion, this is
a great way for green investors to put small sums of money to work
with exposure to the market.

-john-

--
================================================== ==================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ==================

Good Morning All,

I am totally new to the investment world and have a couple of
questions for everyone who would like to help. I have opened up a starter
account with sharebuilder.com. I plan on monthly putting in $200.00 per
month into this account with a plan for about 2 years or so. I've looked
at some of there options and pritty much get lost. What would be a good
baseline plan to go into with this monthly investment and all options
would be great. Also, since I am new to this investment world where would
be a good place to get the basics of information regarding investing, i.e.
web sites, books and so on. Thanks for the help and look foward to
hearing your responses.

Respectfully,

Ryan
Mile High Security