Oct
26
23yo College Grad – Needs Money Advice?
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doog18z asked:
Graduated from college in 2005 and have been working since. Worked my butt off in school and landed a job paying in the mid 70’s starting. still live at home to save some cash (thank god for mom and dad). Been able to save over 30k in 2006 and will prob be able to do the same in 2007 (savings is earning 5% annually ). Have my 401k covered as well as a company pension plan (will be well taken care of after retirement, 42 years from now). Have an IRA and some stock investments (not much $$$ in them). My question, what should i look into for investments? I live in los angeles where a 2 bedroom shack costs $500k so real estate may be out of the question nonetheless i am banking on this bubble to burst. should i continue to save and go on a shopping spree when real estate prices come back to normal? advice from a seasoned pro would be nice….
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Graduated from college in 2005 and have been working since. Worked my butt off in school and landed a job paying in the mid 70’s starting. still live at home to save some cash (thank god for mom and dad). Been able to save over 30k in 2006 and will prob be able to do the same in 2007 (savings is earning 5% annually ). Have my 401k covered as well as a company pension plan (will be well taken care of after retirement, 42 years from now). Have an IRA and some stock investments (not much $$$ in them). My question, what should i look into for investments? I live in los angeles where a 2 bedroom shack costs $500k so real estate may be out of the question nonetheless i am banking on this bubble to burst. should i continue to save and go on a shopping spree when real estate prices come back to normal? advice from a seasoned pro would be nice….
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2 Comments
October 26th, 2009 at 4:07 pm
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I’m not a seasoned pro, but I can say this. Because you are so young, you should go after mainly agressive type stuff. I like mutual funds, because you get a good diversified bunch of stuff, and it’s low maintance. Go to a professional shop like Charles Schwab, they can help you with spicifics. I can tell you, it helps to go with a profesional.
I am 18, and I started my college fund when I was 6, when my dad died. Most people can expect to double their money every 8 – 10 years, but I did much better than that. You honestly get what you pay for, and a good financial planner/adviser can really help you get a sense of your entire financial picture.
October 28th, 2009 at 6:54 pm
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The bubble has burst, It won’t get any better than it is now. Interest rates are around 6% which is also great. Believe me, I have lived through 8% to 12 % interest rates with 2 points to close. That won’t get much better either. Look into a condo to get you started. It’s a ladder approach. Buy something that will do you for the next 4 to 5 years. Then trade up.
Don’t plan on keeping a job till your 62, corporate America has a way of dumping on you when you hit your late 50’s They can hire 2 20 year olds for what they pay you.
If you buy a $300k condo and put $30k down, and live there for 4 years and the value increases 5% a year then it will be worth over $360k. When you sell you will get 90K out in equity which will have earned you 200% on your investment over 4 years or 50% a year.