Seeking investment advice!
Hey, female, in my early 30s, trying to get financial education and boost my cash flow. I installed Robinhood and bought google, Microsoft and all that! But I’m not sure how to diversify my portfolio! Was thinking about QQQ and SPY but need to do more research! Should I hire an advisor? What should I do with my saving if I’m not planning to buy a property (been doing fundrise for a while) and matching my 401k? YoE: 5 TC: 225k
Following
+1 to hiwxp’s suggestion. They have a series of relatively short videos if you don’t want to explore the wiki https://www.bogleheads.org/wiki/Video:Bogleheads®_investment_philosophy
No QQQ
Why?
Either go all in on BBBY or get a financial advisor. Mutually exclusive.
My $0.02, do not use an advisor. The market is incentivised by Assets Under Management (AUM). They each want many tens/hundreds of millions under them, it is the metric of their worth. What % of their time do you think they spend considering your nest egg compared to the entire basket? Instead, I'd find a way to get sound advice from someone who can only benefit from giving you sound advice, not by deceiving you. One thing I do currently is follow someone I trust in on Patreon, I pay each month to access his advice, and manually make my own trades based on that. I like this model because if he gives bad advice, he'll lose subscribers, there is alignment of incentives. He also has no idea how much of my funds he's influencing, so nor does he care. There are also "fee-only" advisors, who will charge you an hourly type rate to advise on your portfolio. I like this idea, for the same reason. Do not believe the lie of "ohh, they are a fiduciary, so they are fully doing what is in my best interest". If it's too overwhelming, I like comment #1, the 3 fund portfolio idea until you want to try something more involved.
What about performance based fee?
You should match your 401K. You did good start by buying google Msft. Subscribe to Barron’s or investors business daily. You can also read some articles free. Start slowly. Take profits and learn to cut losses.
Started with 0 11 years ago, current NW 1m+ 1. Put money in your 401k and invest it in index funds (equity over debt in early years) 2. Invest up to the post tax maximum in a roth IRA if your employer allows it. The tax savings are mind boggling, and you get to hold the same securities with tax free growth) 3. Put money in HSAs - another great tool for healthcare expenses without having to pay taxes 4. Put money in 529 (yes, you can do this before you have a kid and name it over to them later) - if you dont think you will ever have a kid - skip this step 5. After all the above is done, and you have an emergency fund, the pot you have (+ Roth IRA from above) is truly investable. I would recommend hold no more than 8-10 separate stocks/funds (securities more generally), since it is hard to keep track on a long term basis. Bucket those into (some of the buckets overlap): 1. i want to hold this forever (>10 year span) - Microsoft, J&J types 2. i want to make a quick buck (buy and sell in 0-3 years) - Hot tech names 3. I want a dividend - Waste Management, Apple, Microsoft, J&J and a host of others 4. I want these to grow, but unsure of prospecgs (watch) - Tesla, Space Exploration etc Lastly, If your risk tolerance is high and you can deal with volatility, assign 1-3% to cryptos
Buying separate stocks from IRA is possible ? I was in impression only we can buy mutual funds and ETFs through pre/post tax IRAs?
Nope - I buy options from my roth acc too!
Open vanguard . Setup auto invest every week into vtsax. Check the account after 20 years .
After maxing out your 401k, Robinhood recurring investments. Setup daily/weekly/biweekly/monthly in ETFs like VOO. You can even link a portion of your paycheck directly to the app and set up how you want it to be invested. Set and forget.
Bogleheads.org look up the 3 fund portfolio, set and forget
Oh and ditch Robinhood and get a legit brokerage like fidelity, Schwab, vanguard
This, get rid of Robinhood