Right now I'm sitting around 28%
Of course, this is in addition to the 6% 401k to get my employer match.
Erm I usually dump roughly 12% of each paycheck in to my savings account. That's about it though. I ought to get around to setting up some investments. Soon, once I get a full time position (I'm 24 and graduating w/ my Master's degree next month)...
What sort of ideas have you had for investments?
Pretty rudimentary ideas: throwing some money into an S&P 500 index fund (probably vanguard), and starting a Roth IRA.
BrainBurner, I love index funds - at this point in my investing career I'd have to invest (hehe) a ton of time and energy into value investing before I'd see returns that could be reasonably relied on to be an index fund... So for now that's all I roll with. I'm in Canada so I've not learned what a Roth IRA or 401(k) are yet, but I'll get there :) Quick ELI5 on the Roth? Is it a wrapper that grants tax benefits to whatever vehicle is inside of it?
Under a Roth IRA you're taxed when you contribute to the fund, but when you withdraw your funds it is untaxed. It makes sense for those who believe they'll be facing higher tax rates in the future; I'm young and expect to have substantial growth as a professional, so it makes sense. The yearly contribution max is $5,500 right now. Not sure what the average rate of return is.
Interesting, the Roth sounds identical to the Canadian Tax-Free Savings Account (TFSA), which has a CAD$5,000 maximum yearly contribution, and exempts all earnings from tax. However, more or less anything can be placed in the TFSA umbrella/wrapper/container - stocks, bonds, cash, bank accounts, ETFs, etc etc etc. Also, that 5k/yr limit is retroactive to 2009, so I've got a good amount of contribution room waiting for me when it's time to invest. :D Thanks Government of Canada!
This should be the first year I max personal contribution limits for 401k, IRA and HSA. Yay. I'm not sure what that breaks down to in % of my take home. My IRA is post tax, my 401k a mix of pre and post tax, and the HSA is pre tax. I hope to invest in land soon, too. I'd like to buy property that gives me the option to build a home or something I can sit on and sell if I decide not to live there. I increasingly hate the idea of (significant) debt, so if I can borrow enough for land and pay it off in less than ten years and then sell my current home to build a house and have no mortgage, that appeals to me. Does anyone buy life insurance as an investment anymore? I know it was a thing for a while, but I never really understood it.
6% + 9.24% employer match. That's waaaay less than I would like, but I've long accepted that this is the way things are going to be for a while, because of supporting a family with one job, and because my wife is not Mustachian in the least. It is what it is.
Mr. Money Mustache is a guy who retired at 30 by, as he puts it, "living a slightly-less-ridiculous-than-average lifestyle." He says that modern white-collar salaries are actually quite a lot of money, and once you realize buying more things doesn't make you any more or less happy, you can save over half of your income without sacrificing any happiness. A Mustachian is an adherent or fan of this idea.
I'm 17 but I'm saving up $3,000 to put in a VTSMX fund when I turn 18. I have about $600 saved and still have four months to go. Wish me luck. I make about $800/month by lifeguarding and waiting tables. Just finished paying my share of a trip to Europe that my parents were so kind to help me out with. Any tips for where to go from here?
Nutin' I don't have a job tho and hoping (trying) the get that entrepreneurial lifestyle going. So that's where my extra $ s going. Honestly, I don't really have anything to worry about thanks to my wonderful parents. My dad emigrated to Canada at 47 and built a pretty decent home ownership business. Ive been tagging along day to day business since I'm a kid and I know I have a backup managing the properties anytime. And by the time its my retirement I'll either have built a business or at least have some property to sell/live off. Well, that s the dream, we'll see where real life leads :)
Hmm... Depends. Do you count Mortgage payments as an investment? It is more tax efficient and a better return for me to pay my debt off on an asset I will own at the end then invest it.
Ignore the hoolah on the media and idiots in /r/investing. Dollar Cost Averaging. Just pick a dollar amount each month and put it in like clockwork. I'm assuming you won't be looking to retire for another two decades at minimum so we're playing the long game here. Remember, even in 2008 nobody lost money in the markets unless they panicked and sold.
Dollar cost averaging made sense in an Era of decreasing interest rates. If you want to see what happens to dollar cost averaging when you have stagflation and a huge bursting bubble take a look at the Japanese market. Socks really seem to have be a strictly speculative/gambling assets where their price is dependent not on fundamentals of growth or profit but of but on the hope that you can sell them later to some greater fool. As long as there is an unlimited amount of money coming out of the FED stocks will grow, but as soon as the spigot closes or the flow decreases the supply of greater fools really dwindles.