Scratchi's Financial Page
Updated May 15, 2000
Why this page?
I decided to start it in May 1998 to try to list some useful links to
financial and investment information, 'quality' and 'free' being important
considerations. There are an awful lot of places out there that don't
want to give you good information for free; they want to sell
you their newsletter or magazine, which is where they're really
making their money. Other sites are nothing but fluff, very low on
anything useful. Over time I hope to have a decent collection of
sites you can visit each day for information you can really use.
(reserved)
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Neat Stuff
Watch your portfolio
all through the day.
Excite Assistant - much the same thing.
Stock Toolbar from Yahoo.
QuoteTracker from Quicken.
Market Activity Map at SmartMoney.
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Other Stuff
Bob Brinker.
He's still touting his newsletter, but he has
recently added message boards and organized things
a lot better than before.
He's on the radio every weekend, and is worth a listen
even if he sometimes does a complete 180 on his own advice
a few months later.
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My Findings:
Please read my disclaimer first.
I cannot be responsible for anything that happens because
you actually took me at my word.
Use of any of this information is at your own risk.
However, here's the general consensus of what I've found:
- Get out of debt. Paying off your credit cards gets you
that 18% or more, not the bank.
- Participate in your employers 401k plan if you can.
Your employer will usually kick in some matching funds,
so you're ahead from the start. At the very least,
do the minimum contribution for which you get the maximum
free money from your boss.
For example, if you are allowed to contribute 15% of
your gross salary, and they match 50% of your first 6% you put in but
no additional matching beyond that, at least do that first 6%.
- Then max out your IRA contribution for the year
Up to $2000 per year per person, depending on your earned income level.
- Then contribute further to the maximum your 401k allows.
You'll find you can pack away a lot more pre-tax money
that way than in an IRA: up to $10000 per year.
- Then sock away additional money. The gains may be taxable but it's
better than letting it languish in a passbook savings account.
And if you think your money will be locked in, you're wrong!
You can get it out at anytime, it'll just cost you a trade fee
and you'll have to pay some capital gains tax on the withdrawal.
(A CD at a bank will hit you for a lot worse and not pay as well.)
Motley Fool has several
proven stock portfolio ideas
that beat most other investments.
- Think long term. Don't worry about the daily fluctuations.
Overall, the stock market goes up more than it goes down.
Plan on keeping your holdings for at least a year each.
- If you want to go for mutual funds, you want no loads
and charges, no 12b-1 fees, and a low expense ratio.
If it's in a taxable account, you also want a low turnover rate
to avoid a lot of capital gains taxes.
Fortunately, there are a wide range of funds that meet those criteria,
no matter what your investment style is (aggressive, moderate,
chicken, whatever).
Also, most mutual funds don't even do as well as the S&P 500 Index,
so, if you can't find anything better, index funds may be just
what you want. The problem is they often have loads and high minimums.
An alternate is to buy shares of
SPY
which has a lot of advantages over a mutual fund.
Read the prospectus carefully.
- Beware of yearly charges from some investment places.
Some charge you $30 a year to punish you for not having ten grand
in your account.
- Don't fall for any Internet
multi-level marketing scams,
pyramid schemes, bulk email chain letters, and other garbage.
Not only are they illegal, they do not work anyway (despite all their
tired old claims otherwise).
No student ever paid his way through a university doing that stuff.
I've heard that the IRS collects names listed on the chain letters,
and takes anyone claiming they made $50 grand in 3 months
at their word! About time, I say.
- Don't gamble your money at
casinos in
Las Vegas.
There's a reason they can offer you hotel rooms (mid-week and off-season)
for just $20,
gigantic
buffets for $5,
and so on. It's because they have an endless crowd of idiots
feeding slot machines!
If you want to make money at the casinos, you might join their side of the
tables instead and just buy stock in
MGM Grand,
Park Place,
Harrah's,
Station,
Boyd,
Mandalay Bay etc.
Remember, if you go
to Vegas you can always enjoy the loss-leader attractions without
risking money
gambling.
- Don't play the lotteries either. They all have the collective
name of "Stupidity Tax!"
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This page is written and maintained by David Bartholomew.
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