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Retirement, College Fund, & Investments Thread

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#1 KSB2424

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Posted 11 March 2015 - 11:51 AM

The Time Value of Money thread got me thinking......

 

Am I saving for the future correctly?   Are there other financial vehicles out there I am not taking advantage of?

 

I have a 401(k)

I have a company pension

My wife (stay at home) has an IRA which is rather small as its only from when she worked for 5 years.

We have a 529 for both kids (6 and 3)

 

Is that par for the Geeks?  Should I have a ROTH IRA?

 

What happens if my kid is brilliant or athletic (they are my son's afterall :P ) and one or both gets a scholarship. Do you really get penalized AND taxed on the 529?  If so thats effed up.

 

What am I missing? 


Disclaimer: I have no focking idea what I'm talking about.

"Only a life lived for others is a life worthwhile." – Albert Einstein

Political Correctness is a doctrine fostered by a delusional, illogical minority, and rabidly promoted by an unscrupulous mainstream media, which holds forth the proposition that it is entirely possible to pick up a turd by the clean end.

 

***2018 EdEx Cup Champion***


#2 Patriotsfatboy1

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Posted 11 March 2015 - 12:01 PM

I have IRA, 401k and Roth IRA. The Roth helps spread out your tax liability as it could be significant if you are cashing in all of that tax deferred stuff when you are older.

The 529's are transferrable, so you could have one transfer to the other if one gets a full boat. You could also give them to your grandkids if both of your kids get full boats.

Remember, cash is king. Are you liquid enough and saving/investing with current needs in mind? I max out my 401k, but I also save/invest with money that I can tap into in a pinch if I want to buy a 2nd home or invest in something large. I am never going to see any financial assistance when my kids go to college, so there is no reason to try and hide it.

Do you have all insurance areas covered, including disability?
Fat, drunk and stupid is no way to go through life, son.

#3 edjr

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Posted 11 March 2015 - 12:05 PM

great. Another brag thread.

 

I like stories.


posty


#4 KSB2424

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Posted 11 March 2015 - 12:07 PM

great. Another brag thread.

 

I like stories.

 

:dunno:

 

Its not like there are dollar figures here.  I don't get how saying one has a 529 for their kid or a 401(k) is bragging.  :unsure:


Disclaimer: I have no focking idea what I'm talking about.

"Only a life lived for others is a life worthwhile." – Albert Einstein

Political Correctness is a doctrine fostered by a delusional, illogical minority, and rabidly promoted by an unscrupulous mainstream media, which holds forth the proposition that it is entirely possible to pick up a turd by the clean end.

 

***2018 EdEx Cup Champion***


#5 NorthernVike

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Posted 11 March 2015 - 12:07 PM

A DI policy should he very high on everyone's list including mine as you are something like three times as likely to be come disabled as you are to die young. Yet most, including myself, don't have one. I use to, but I figure it won't happen to me. :pray:

Being an ass hole is all part of my manly essence

 

 



You guys have no focking clue what happened so you really should just shut it..

 


#6 HenryHill9323

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Posted 11 March 2015 - 12:08 PM

:dunno:
 
Its not like there are dollar figures here.  I don't get how saying one has a 529 for their kid or a 401(k) is bragging.  :unsure:


Ed is poor.

The Best Of: IGotWorms:you spineless little faggut....... What a useless sack of sh!t you are......Get it through your thick focking troll head.....Maybe it gets focktards like you hard......Were you not such a moron that would be fairly obvious.....Now eat a gun you miserable waste of life.......a bunch of focktards.......you're all faggut trolls......you're focking retarded......a focking dumbass troll.....Your a lazy fock......He really should eat a bullet....Monumental retard........you're a collosal retard......fock of troll...I'll suck your cack for $1000.00...worthless sack of sh!t internet troll.....Hoping he will post a nudie.....Fock off you flaming piece of sh1t.......kill yourself immediately.....you're filth. Pure focking trash......sad-sack-low-life pathetic excuse for a human being...GOd damn you are remarkably stupid.....you redneck sack of sh1t......everyone hates his gOd damned guts...Jesus Christ you are a focking dumbass....you're a worthless sack of sh!t.

 

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#7 NorthernVike

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Posted 11 March 2015 - 12:09 PM

 
:dunno:
 
Its not like there are dollar figures here.  I don't get how saying one has a 529 for their kid or a 401(k) is bragging.  :unsure:


It's not. It's just smart if you know you won't be able to get a hand out.

Being an ass hole is all part of my manly essence

 

 



You guys have no focking clue what happened so you really should just shut it..

 


#8 patweisers44

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Posted 11 March 2015 - 12:14 PM

great. Another brag thread.
 
I like stories.

It ain't braggin' mother***er if you back it up.......
To be the man, you gotta beat the man.

#9 NorthernVike

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Posted 11 March 2015 - 12:18 PM

It ain't braggin' mother***er if you back it up.......


Nice Kid Rock quote. :thumbsup:

Being an ass hole is all part of my manly essence

 

 



You guys have no focking clue what happened so you really should just shut it..

 


#10 KSB2424

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Posted 11 March 2015 - 12:18 PM

I read where in-state college costs (tuition/books/room&board) etc. will be over 100K for 4 years in a decade.  And thats in state, out of state or private is twice that.

 

I'm 39, reality is starting to hit me in the haid.   :cry:


Disclaimer: I have no focking idea what I'm talking about.

"Only a life lived for others is a life worthwhile." – Albert Einstein

Political Correctness is a doctrine fostered by a delusional, illogical minority, and rabidly promoted by an unscrupulous mainstream media, which holds forth the proposition that it is entirely possible to pick up a turd by the clean end.

 

***2018 EdEx Cup Champion***


#11 edjr

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Posted 11 March 2015 - 12:40 PM

It ain't braggin' mother***er if you back it up.......

 

I have 4 accounts.

 

529

401k (one I fund and 1 work funds  through profit sharing

IRA Roth

 

http://postimg.org/image/6w8greq7p/

 

 

:gfy:


posty


#12 Patriotsfatboy1

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Posted 11 March 2015 - 01:54 PM

I read where in-state college costs (tuition/books/room&board) etc. will be over 100K for 4 years in a decade.  And thats in state, out of state or private is twice that.
 
I'm 39, reality is starting to hit me in the haid.   :cry:


We started saving via 529's for each of our kids when they were born. I have already told them that they better start saving their own money because we don't have enough to cover everything. We also explain that each of us paid for our bachelor's by ourselves, so they can't cry.
Fat, drunk and stupid is no way to go through life, son.

#13 edjr

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Posted 11 March 2015 - 02:06 PM

I read where in-state college costs (tuition/books/room&board) etc. will be over 100K for 4 years in a decade.  And thats in state, out of state or private is twice that.

 

I'm 39, reality is starting to hit me in the haid.   :cry:

 

if i don't add another penny, it will still be more than my parents gave me


posty


#14 tanatastic

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Posted 11 March 2015 - 02:09 PM

Dont waste money on college funds for kids. College is a scam and huge waste of time and money. I know a handful of people who make 100k a year and tnone went to college. College is a great place to get a hjob paying a nice 30-50k a year and no more. Pencil pushing suicide inducing jobs that people hate, if they get a job at all. Encourage them to start their own business, tell them to try and become "internet famous" or just spend 4 years networking and making connections. School is pointless unless you want to become a doctor, lawyer or dentist. 



#15 KSB2424

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Posted 11 March 2015 - 02:37 PM

School is pointless unless you want to become a doctor, lawyer, dentist, accountant/finance/economics, teacher, nurse, or engineer.

 

You're post does have some merit.  But I edited your post.

 

Agreed that its not really for everyone.  Technical and Speciality schools should be on the rise. 


Disclaimer: I have no focking idea what I'm talking about.

"Only a life lived for others is a life worthwhile." – Albert Einstein

Political Correctness is a doctrine fostered by a delusional, illogical minority, and rabidly promoted by an unscrupulous mainstream media, which holds forth the proposition that it is entirely possible to pick up a turd by the clean end.

 

***2018 EdEx Cup Champion***


#16 IGotWorms

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Posted 11 March 2015 - 03:00 PM

Sounds about right, KSB. Your wife should probably be maximizing her IRA contributions if you qualify for the deductions. You might want to add a Roth since it's another tax-advantaged vehicle.

Roth seems kinda dumb to me on its face since it's hard to believe you will be taxed more in retirement than when you were working -- things would have to go VERY well for you or taxes would have to be hiked up quite a bit.

However you can usually contribute to a Roth even when maxed out for traditional IRA/401k so it does have that purpose.

#17 Baker Boy

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Posted 12 March 2015 - 05:39 PM

Health care costs for retirees are considered likely to continue to rise. For example, by 2020 a 65-year-old married couple without an employer-based health plan and with median drug expenses could need a total of $365,000 to $454,000 to pay for Medigap, Medicare Part B and Part D premiums and out-of-pocket drug expenses.


No ACA for you!

#18 NorthernVike

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Posted 12 March 2015 - 06:56 PM

Health care costs for retirees are considered likely to continue to rise. For example, by 2020 a 65-year-old married couple without an employer-based health plan and with median drug expenses could need a total of $365,000 to $454,000 to pay for Medigap, Medicare Part B and Part D premiums and out-of-pocket drug expenses.


No ACA for you!


They don't need aca, they already have medicare. Depending on what drugs you need, you can get a supplement for under 150 a month.

Being an ass hole is all part of my manly essence

 

 



You guys have no focking clue what happened so you really should just shut it..

 


#19 Brad GLuckman

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Posted 12 March 2015 - 07:13 PM

Man I only have a 401k and I put 15% towards it, plus my company matches 6%.
Same for my wife but she only adds 10%.

Are we behind the curve?
We met with a financial planner but he just tried to push whole life insurance on us.

We really don't know what we're doing, but financial planners only care about commission.

#20 Baker Boy

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Posted 12 March 2015 - 07:24 PM

They don't need aca, they already have medicare. Depending on what drugs you need, you can get a supplement for under 150 a month.


You better do your homework. ACA stole $700 Billion from Medicare to help fund the plan and it is not the deal you think it is. Medicare is not free and only covers 80% of your costs. Supplemental insurance to pay the 20% will cost you more than your employer backed full Insurance Policy. You better include health insurance in your retirement plans or you will not be enjoying your "Golden Years". Ignoring the truth will not make it go away.

#21 Patriotsfatboy1

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Posted 12 March 2015 - 08:15 PM

Man I only have a 401k and I put 15% towards it, plus my company matches 6%.
Same for my wife but she only adds 10%.

Are we behind the curve?
We met with a financial planner but he just tried to push whole life insurance on us.

We really don't know what we're doing, but financial planners only care about commission.


Life insurance should not be an investment vehicle. Get a real investment guy. The good ones do cost money, but they make money for you.

Have a portfolio of different vehicles that are diversified. It is not a sprint so be patient. Slow and steady can win that race.
Fat, drunk and stupid is no way to go through life, son.

#22 Brad GLuckman

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Posted 12 March 2015 - 08:20 PM

Life insurance should not be an investment vehicle. Get a real investment guy. The good ones do cost money, but they make money for you.
Have a portfolio of different vehicles that are diversified. It is not a sprint so be patient. Slow and steady can win that race.

Are you suggesting a fee based planner? They're hard to find.
Mine charged nothing, but obviously got commission for what he tried to sell us. I didn't like that.

#23 Patriotsfatboy1

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Posted 12 March 2015 - 08:29 PM

Are you suggesting a fee based planner? They're hard to find.
Mine charged nothing, but obviously got commission for what he tried to sell us. I didn't like that.


I have a guy who manages my 401k, 529's, IRA's and cash/stock investments. He gets paid based in the size of my portfolio and growth. If I make money, he makes money.

I used to do it all myself and it was a lot of work and I was not good at the timing of my transactions (too early or too late).
Fat, drunk and stupid is no way to go through life, son.

#24 IGotWorms

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Posted 12 March 2015 - 09:38 PM

All financial planners are scammers. You can figure this stuff out yourself without someone skimming 2% off your 8% return.

#25 IGotWorms

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Posted 12 March 2015 - 09:41 PM

Man I only have a 401k and I put 15% towards it, plus my company matches 6%.
Same for my wife but she only adds 10%.

Are we behind the curve?
We met with a financial planner but he just tried to push whole life insurance on us.

We really don't know what we're doing, but financial planners only care about commission.

Depends on how old you are but if you're contributing 21% total you are probably doing great.

May want to look into adding a Roth IRA although I suspect your MAGI might be too high to qualify. Could do a traditional IRA, probably won't get tax deduction for contributions since you have a 401(k) but your earnings still grow tax free

#26 Magnificent Bastard

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Posted 12 March 2015 - 11:19 PM

I would recommend "the retirement gamble" on pbs' frontline. You can watch it online. It covers a lot of what you guys are talking about. One takeaway was that a lot of the portfolio managers, like Edward Jones, get a 2% commission on a yearly basis, whether it goes up or down. It really eats into your portfolio over the years. The guy who started vanguard funds said you should just buy shares in a s&p 500 fund on your own. Like I said, check it out, it will be a great hour spent. You have to be on this, because you really have nowhere else to put your money for retirement. Savings and bonds pay nothing right now.

#27 Patriotsfatboy1

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Posted 13 March 2015 - 04:15 AM

All financial planners are scammers. You can figure this stuff out yourself without someone skimming 2% off your 8% return.


I don't pay even 2%
Fat, drunk and stupid is no way to go through life, son.

#28 IGotWorms

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Posted 13 March 2015 - 06:49 AM

I don't pay even 2%


As much as he sucks as a poster, MB is right about "the retirement gamble" frontline episode. You should watch it.

Whatever you are paying in fees, it's basically reverse compound interest. 1% or whatever may not sound like a lot but it can add up to tens of thousands less in your retirement account over the years. Maybe even six figures less. And for what?

http://www.fool.com/...-financial.aspx

#29 Patriotsfatboy1

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Posted 13 March 2015 - 07:14 AM

As much as he sucks as a poster, MB is right about "the retirement gamble" frontline episode. You should watch it.

Whatever you are paying in fees, it's basically reverse compound interest. 1% or whatever may not sound like a lot but it can add up to tens of thousands less in your retirement account over the years. Maybe even six figures less. And for what?

http://www.fool.com/...-financial.aspx


Again, I don't pay an annual fee. I used to have someone managing things that was charging that stuff and I pulled my money from there and managed it myself. The problem was when I added in my cash/stock investments into the mix, I was not reacting to the market appropriately and was missing out on things. I was also not rebalancing my portfolio. So, I found a guy who does this for me and it costs me far less than what my increased returns have become.

If you are worried about the fees and are unsure whether it is worth it, do what I did. I gave him money to manage for me and I kept doing my own management on a separate account for one year. His yield was 12% after his cut and mine was 8%. Granted, he is a friend and does not solicit clients, but to say that none of them are worth it is not true.

Oh, and don't forget the time that you spend on managing your money when it comes to taxes and rebalancing. I am better off spending my time making more money.
Fat, drunk and stupid is no way to go through life, son.

#30 IGotWorms

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Posted 13 March 2015 - 07:51 AM

Again, I don't pay an annual fee. I used to have someone managing things that was charging that stuff and I pulled my money from there and managed it myself. The problem was when I added in my cash/stock investments into the mix, I was not reacting to the market appropriately and was missing out on things. I was also not rebalancing my portfolio. So, I found a guy who does this for me and it costs me far less than what my increased returns have become.

If you are worried about the fees and are unsure whether it is worth it, do what I did. I gave him money to manage for me and I kept doing my own management on a separate account for one year. His yield was 12% after his cut and mine was 8%. Granted, he is a friend and does not solicit clients, but to say that none of them are worth it is not true.

Oh, and don't forget the time that you spend on managing your money when it comes to taxes and rebalancing. I am better off spending my time making more money.


Time and effort is certainly a valid point. To me it isn't worth six figures over the life of the account but I suppose that's a matter of perspective.

As for returns, pretty much nobody beats the market over time. Even the great Warren Buffet has had a streak of underperforming the market lately. The law of averages catches up to everyone over time. Study after study says that pretty much the only reliable predictor of performance is your asset allocation. So I dunno, maybe your buddy upped your stock to bond ratio, but that's something you can do yourself pretty easily.

#31 Patriotsfatboy1

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Posted 13 March 2015 - 07:59 AM

Time and effort is certainly a valid point. To me it isn't worth six figures over the life of the account but I suppose that's a matter of perspective.

As for returns, pretty much nobody beats the market over time. Even the great Warren Buffet has had a streak of underperforming the market lately. The law of averages catches up to everyone over time. Study after study says that pretty much the only reliable predictor of performance is your asset allocation. So I dunno, maybe your buddy upped your stock to bond ratio, but that's something you can do yourself pretty easily.


Your assumption is that the financial advisor is only telling you about how to make money on stocks and similar vehicles. The reality (as evidenced by the OP's post) is that there are questions of how to manage your money that go far beyond just stocks. Managing the balance between investing completely different purposes (today, retirement, college, risk management, etc.) is where the value is. I am not sure about you, but I don't want all my eggs in the US stock market, so you also have to factor in diversification. Once you do that, you then need to rebalance over time to prevent yourself from having too many eggs in a particular basket. Add all of that up and there is management that has to occur.

If you are capable and can do it as well as a financial advisor, then have at it. Either way, you might want to consider this (from the article that you posted)
 

Let me make one thing clear. I am not saying financial advisors are wicked people nor am I saying many advisors don't provide a deeply valuable service. However, if you do use a financial advisor or money manager, take a long, hard look at the graphs above and ask yourself, "Am I getting my money's worth?"


Fat, drunk and stupid is no way to go through life, son.

#32 IGotWorms

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Posted 13 March 2015 - 08:03 AM

Your assumption is that the financial advisor is only telling you about how to make money on stocks and similar vehicles. The reality (as evidenced by the OP's post) is that there are questions of how to manage your money that go far beyond just stocks. Managing the balance between investing completely different purposes (today, retirement, college, risk management, etc.) is where the value is. I am not sure about you, but I don't want all my eggs in the US stock market, so you also have to factor in diversification. Once you do that, you then need to rebalance over time to prevent yourself from having too many eggs in a particular basket. Add all of that up and there is management that has to occur.

If you are capable and can do it as well as a financial advisor, then have at it. Either way, you might want to consider this (from the article that you posted)
 


Fair enough. The issue is most people have no idea how much the service actually ends up costing them. If you've done the math and its worth it to you, then more power to you :cheers:

As for me, most of the stuff you talked about is pretty simple. Diversification, okay, I'll add in an emerging market index fund or an REIT fund. No biggie. Rebalancing? They say doing it only once per year is probably the best approach, so that's pretty simple.

#33 Patriotsfatboy1

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Posted 13 March 2015 - 08:14 AM

Fair enough. The issue is most people have no idea how much the service actually ends up costing them. If you've done the math and its worth it to you, then more power to you :cheers:

As for me, most of the stuff you talked about is pretty simple. Diversification, okay, I'll add in an emerging market index fund or an REIT fund. No biggie. Rebalancing? They say doing it only once per year is probably the best approach, so that's pretty simple.


Who is "they"? The "probably once a year" is dependent on a variety of factors and I would contend that many times that is too often to actually take action. The timing of those efforts can cost you even more than the fees. Don't forget that those funds have fees built into them as well. Nothing is for free.

If you have an "advisor" who does not give you value for the cost that you pay, then you get a new one. Same as any other profession. If people do not spend the time to understand where their money is going, then they are foolish.
Fat, drunk and stupid is no way to go through life, son.

#34 IGotWorms

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Posted 13 March 2015 - 08:18 AM

Who is "they"? The "probably once a year" is dependent on a variety of factors and I would contend that many times that is too often to actually take action. The timing of those efforts can cost you even more than the fees. Don't forget that those funds have fees built into them as well. Nothing is for free.

If you have an "advisor" who does not give you value for the cost that you pay, then you get a new one. Same as any other profession. If people do not spend the time to understand where their money is going, then they are foolish.


I don't pay anything to rebalance.

http://www.vanguard.com/pdf/icrpr.pdf

#35 Patriotsfatboy1

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Posted 13 March 2015 - 08:19 AM

I don't pay anything to rebalance.

http://www.vanguard.com/pdf/icrpr.pdf


I did not say that you did. I said that the funds themselves have fees associated with them.
Fat, drunk and stupid is no way to go through life, son.

#36 IGotWorms

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Posted 13 March 2015 - 08:25 AM

I did not say that you did. I said that the funds themselves have fees associated with them.


I pay no transaction fees and I'm only in tax advantaged accounts so there aren't tax issues either. Depends on what you're invested in I suppose but obviously the analysis would be different if fees were involved

#37 Patriotsfatboy1

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Posted 13 March 2015 - 08:28 AM

I pay no transaction fees and I'm only in tax advantaged accounts so there aren't tax issues either. Depends on what you're invested in I suppose but obviously the analysis would be different if fees were involved


DOES THE FUND HAVE FEES BUILT IN?

If you somehow are in a fund that has no management fees built in and no transaction fees, I would jump on that in a heartbeat. My question in that situation would be - how exactly do they make money - volume?

http://www.nbc.com/s...ange-bank/n9701
Fat, drunk and stupid is no way to go through life, son.

#38 IGotWorms

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Posted 13 March 2015 - 08:35 AM

DOES THE FUND HAVE FEES BUILT IN?

If you somehow are in a fund that has no management fees built in and no transaction fees, I would jump on that in a heartbeat. My question in that situation would be - how exactly do they make money - volume?

http://www.nbc.com/s...ange-bank/n9701


Well of course there are fees for management. Expense ratio is pretty low for the index funds I'm primarily invested in. What does that have to do with what we're taking about though? :wacko:

#39 IGotWorms

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Posted 13 March 2015 - 08:40 AM

Management fees aren't the same as transaction fees and I'm not invested in funds with transaction fees.

If your goal here is to shift to talk about expense ratios, well okay. It's not that hard to find solid funds with low expense ratios. Basically check out Fidelity or Vanguard.

Not what sucks is when your 401k only has investment options with high fees. Not much you can do about that except convince your company to dump their plan manager

#40 Patriotsfatboy1

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Posted 13 March 2015 - 09:04 AM

Well of course there are fees for management. Expense ratio is pretty low for the index funds I'm primarily invested in. What does that have to do with what we're taking about though? :wacko:


Uggh.

You can have an advisor who charges you fees to manage your portfolio, which includes stocks and other vehicles. There may or may not be fees in the associated transactions that they do, but in aggregate, he is charging you management fees.

You can buy funds that essentially do the same thing and they charge you management fees. Do you see how they are related?

The problem is when you have someone (anyone) who is charging you a fee that you don't get commensurate value for.
Fat, drunk and stupid is no way to go through life, son.