# Category: House Architecture

## Retirement Archives – Money Crashers

Source: moneycrashers.com

## Your Retirement Savings Goal for 2021 – The Best Interest

Looking for a New Years Resolution? Start saving for retirement! This calculator helps you build a retirement savings goal for 2021.

Source: bestinterest.blog

## Turkey, Money, COVID, and More

I’m thankful for you, reading this article. But I’m also thankful for turkey and potatoes and pecan pie. And in the spirit of Thanksgiving dinner, I’d like to serve you with a smorgasbord today. The appetizer comes from the engineering world. The main course brings in investing. And for dessert, I added a quick calculator to consider the risk of COVID at your Thanksgiving dinner.

## Low and Slow

I’m a mechanical engineer. In the engineering sub-field of heat transfer, there’s an important quantity called the Biot number. The Biot (bee-yo) number compares the way heat enters a body at its surface against the way that heat travels through the body.

That might not make sense to you. That’s why the Biot number needs to be explained using food!

Why do we cook pizzas at 900ÂºF for 3 minutes? Great question, especially when compared against cooking turkeys at 350ÂºF for multiple hours.

Pizza has a small Biot number. It has a large surface area compared to its volume—it’s very thin. Any energy added to the pizza at its surface will quickly propagate to the center of the pie.

But turkey has a large Biot number. It’s roughly spherical, so its ratio of volume to surface area is vastly larger than a pizza’s. It takes time for energy added at the surface of the turkey to propagate to the center of the turkey.

And then there’s the matter of mass. This is separate from the Biot number, but equally important. Cooking a 20-pound turkey will take longer than cooking a 1-pound pizza. That’s easily understood. Heavy stuff takes longer to warm up.

Why do I have to bake pumpkin bread at 325ÂºF for an hour? Why can’t I bake it for 450ÂºF for 40 minutes? Or in a pizza oven, at 900ÂºF for a few minutes?

I don’t recommend it, but it’s an experiment you could conduct yourself. You’d find that you’d overload the exterior of the loaf with heat before giving that heat enough time to propagate to the center of the loaf. The outside burns. The inside remains raw. And everyone’s sad at the lack of pumpkin bread.

The more cubic or round or dense a food is, the more low-and-slow the cooking or baking will be. This applies to loaves of bread, cakes and pies, or dense cuts of meat. A meat smoker might run at 225ÂºF all day.

If a food is flat or thin or narrow, it can probably be cooked high and fast. Pizzas, bacon, stir fries all apply. Lots of surface area and lightweight.

But what about mashed potatoes? We only boil potatoes at 212ÂºF degrees for 15 minutes. That’s way colder and shorter than a turkey or pie. And potatoes are reasonably dense. What gives?

The answer is that water transfers heat more effectively than air. That’s why 60ÂºF air feels temperate to your skin, but 60ÂºF degree water is frigid. That’s why you can stick you bare hand in a 400ÂºF oven (for a few seconds), but sticking your hand in boiling water (212ÂºF) will scald you. Water moves heat better than air.

And moving or flowing fluid transfers heat better than stagnant fluid. This is why cold winter air has a “wind chill” factor—the blowing cold air removes more heat from your skin that stagnant cold air. And those Thanksgiving potatoes are surrounded by boiling and roiling water. They cook quickly.

## Invest Like a Turkey

Enough engineering. Let’s bring it back to money.

You can approach investing like baking a pizza. Or you can invest like you would cook a turkey. I recommend the turkey version.

You can (try to) pick stocks that will double overnight. Or you could explore exotic asset classes with promises of “going to the moon.” You can even borrow money—or leverage—to further extend your investments. This is investing like a pizzamaker. It’ll be hot and fast and potentially over in five minutes.

But sadly, historical context provides ample data suggesting that pizza investing is not effective. Hand-picking stocks has more risk than reward. Short-term flips are closer to gambling than to investing.

That’s why you should invest like a turkey. Low and slow and long-term. Check on your progress occasionally. Adjust your timeline if needed. A half-cooked turkey does not resemble your final product, just like a half-funded portfolio can’t support your retirement. But mostly, stay on plan and trust the process. Plan for the long-term and let time take care of the rest.

Use last week’s retirement calculator to plan for the long-term…starting with your savings goal for 2021.

## A Plate Full of Stuffing

And speaking of Thanksgiving, ensure that your investing portfolio resembles a Thanksgiving plate: diverse and well-balanced.

Could you imagine eating 1500 calories worth of gravy? Well, maybe. But it would be accompanied by plenty of turkey, stuffing, cranberry sauce and potatoes, too. You can even fit in a slice of something exotic, like pecan pie.

Similarly, a well-balanced investment portfolio reduces your risk from being over-exposed to any single asset type. I described my personal choices in my “How I Invest” article. But there are many ways to skin a turkey, and many ways to diversify a portfolio.

## Will Your Turkey Get COVID?

Everyone seems to be all huffy about gathering for Thanksgiving. So-called “experts” are saying the holiday will act as a super-spreading event for COVID. First, Starbucks cancelled Christmas. And now China is cancelling Thanksgiving? What’s up with that?!

Don’t be an ignoramus. For most of the United States, a gathering of 10 or more people has a higher than 50% chance to contain at least person who is positive for COVID. Re-read that sentence.

If you’re going to gather for Thanksgiving, it’s helpful to understand the risk involved. For some, the risk is small and reasonable. For others, the probability of COVID being at your gathering will easily surpass a coin flip.

The following calculator is a simple, first-order estimate. It provides an example of how probabilities work. There’s more explanation after the calculator.

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`form_structure_1=[[{"form_identifier":"","name":"fieldname2","shortlabel":"","index":0,"ftype":"fnumber","userhelp":"How many people will be at your Thanksgiving? ...Or at any gathering you're interested in looking in to","userhelpTooltip":false,"tooltipIcon":false,"csslayout":"","title":"People at Thanksgiving","predefined":"10","predefinedClick":false,"required":true,"exclude":false,"readonly":false,"size":"small","thousandSeparator":"","decimalSymbol":".","min":"0","max":"150","formatDynamically":false,"dformat":"digits","formats":["digits","number","percent"],"fBuild":{},"parent":""},{"form_identifier":"","name":"fieldname3","shortlabel":"","index":1,"ftype":"fnumber","userhelp":"What is your state's, region's, or community's positive infection rate? You can look it up here: https://covidactnow.org/?s=1360346","userhelpTooltip":false,"tooltipIcon":false,"csslayout":"","title":"Your Local Positive Infection Rate (Percentage)","predefined":"4.4","predefinedClick":false,"required":true,"exclude":false,"readonly":false,"size":"small","thousandSeparator":"","decimalSymbol":".","min":"0","max":"100","formatDynamically":false,"dformat":"number","formats":["digits","number","percent"],"fBuild":{},"parent":""},{"dependencies":[{"rule":"","complex":false,"fields":[""]}],"form_identifier":"","name":"fieldname11","shortlabel":"","index":2,"ftype":"fCalculated","userhelp":"Based on your inputs, this is the probability that at least one person with COVID-19 will be at your gathering","userhelpTooltip":false,"tooltipIcon":false,"csslayout":"","title":"Probability That COVID Will Be at Your Thanksgiving","predefined":"","required":false,"exclude":false,"size":"medium","eq":"ROUND(100-100*POW((1-fieldname3/100),fieldname2),0.1)","suffix":"%","prefix":"","decimalsymbol":".","groupingsymbol":"","readonly":true,"noEvalIfManual":true,"formatDynamically":false,"hidefield":false,"fBuild":{},"parent":""}],{"0":{"title":"Turkey and COVID: Probability of COVID at your gathering","description":"A quick calculator to help you understand the risk of coronavirus at your Thanksgiving dinner","formlayout":"top_aligned","formtemplate":"","evalequations":1,"evalequationsevent":"2","autocomplete":1,"persistence":0,"customstyles":"#fbuilder input[type=text],n#fbuilder textarea,n#fbuilder select {nborder: 2px solid #3b7d04;n}nn.specialclass select {border: 2px solid #00f !important;}"},"formid":"cp_calculatedfieldsf_pform_1"}];`

I’m not an epidemiologist or virologist. Please take this math at face value. If an area has a positive infection rate P, then then odds of a person being negative is 1-P. The odds that all N people at your gathering are negative is (1-P)^N. Therefore, the odds of at least one positive case at your Thanksgiving gathering is 1-(1-P)^N.

I recommend looking up your area’s positive case rate here—COVID ActNow. Now, a large positive test rate is just as indicative of insufficient testing as it is of high infection rates. If you only have enough test supplies to test the sickest people, then you’re likely to have a higher rate of positive infections. More reading here from a guy named Johns Hopkins.

So feel free to play around with the infection rate. The true infection rate of an area is likely lower than what’s reported on COVID ActNow.

Keep Grandma healthy!

## Thanks Again

Thanks a ton for reading the Best Interest. I try to stuff this blog full of fun and helpful information, and having wonderful readers is the gravy on top.

I wish you a happy and healthy Thanksgiving. And don’t burn the pumpkin bread!

If you enjoyed this article and want to read more, Iâd suggest checking out my Archive or Subscribing to get future articles emailed to your inbox.

Source: bestinterest.blog

## Webull Review 2020: Investing Power in Your Pocket

This page may include affiliate links. Please see theÂ disclosure pageÂ for more information. Webull believes that everyone should have an equal opportunity to control their financial future, and with their app, you can do just that. Let’s dig into our Webull review. What is Webull? It’s an iOS and Android online stock trading app that incorporates…

The post Webull Review 2020: Investing Power in Your Pocket appeared first on Debt Discipline.

Webull Review 2020: Investing Power in Your Pocket was first posted on September 17, 2020 at 6:30 am.

Source: debtdiscipline.com

## How to Invest in Gold as a Beginner

Gold is one of the oldest investment strategies there is and continues to be relevant even today. Gold tends to move in the opposite direction as the stock market, so it can be a worthwhile…

The post How to Invest in Gold as a Beginner appeared first on Crediful.

Source: crediful.com

## The 10 Best Vanguard Index Funds to Buy

If you don’t have the time, the money or the expertise to buy individual stocks or bonds to build your investment portfolio, then consider the best Vanguard index funds.

Index funds are a good way to start saving and investing for retirement.

One reason is because the chance of making more money investing in index funds is far higher than it is investing in individual stocks, especially if you are a beginner investor.

As the master of value investing, Warren Buffett, once said “a low-cost index fund is the most sensible equity investment for the great majority of investors.” “By periodically investing in an index fund, the know-nothing investor can actually out-perform most investment professionals.”

But how do you find and choose among the best Vanguard index funds? Don’t worry, GrowthRapidly can help make your choice easier.

## Index funds vs mutual funds

Index funds are one of the easiest and cheapest ways to invest in the stock market. As opposed to a mutual fund, which is actively managed by a fund manager, index funds are passive.

This means that index funds attempt to track the performance of a particular index, such as the Standard & Poor’s 500 index of 500 large U.S. company stocks or the CRSP US Small Cap Index.

So, when you invest in the Vanguard S&P 500 Index fund (which we’ll discuss in more detail below), you’re essentially buying a piece of the 500 largest publicly traded US companies.

Index funds don’t jump around; they stayed invested in the market. Again, they simply track the performance of the stock index.

Related: What is a mutual fund?

Whereas with a mutual fund, fund managers might make mistake by not being invested when the market goes up or by being too aggressive when the market goes down.

That doesn’t mean mutual funds are not good investments. In fact, they are great investment vehicles. But when it comes to long term investments, index funds are the best. However, these 8 mutual funds are great for long term investing.

Like a mutual fund, you can buy an index fund through a fund company like Vanguard.

The main advantage of a Vanguard index fund is its low-cost, which is usually less than 1% annually. Another benefit of Vanguard index funds is that they are diversified. Like mutual funds, they invest to multiple companies, thus spreading out the risk.

One of the downside with index funds, however, is that they won’t outperform the market they track.

## Why choosing the best Vanguard index funds to invest your money?

There are thousands of fund companies (such as Fidelity, Schwab, JP Morgan) where you can buy index funds. Different companies have different experiences and expertise with different type of funds. So, it can be difficult to know which one is the best.

Here are four main factors to consider when looking to buy the best index funds for long term investments:

• The company: Is it a reputable and well-known company with a great track record?
• Fees: Another major factor to consider in picking a fund company is its cost. Excessive fees have a negative effect on your investment return. These fees are deducted from your index fund’s balance every year. Other fees can apply as well. So always find a company with a low fee.
• Reasonable minimum investment: Will you be able to invest with as little as \$1000?
• Performance: Although past performance does not guarantee future performance, look for a fund company with a strong record of performing well against its competitors over the short and long term as well.

If you are an intelligent investor who has done his or her research, you will conclude that among the various fund companies out there, Vanguard comes out on top.

Jack Bogle, who recently died and who founded the firm Vanguard Group, invented the index fund in 1976.

Today, Vanguard is one of the World’s biggest and the best investment funds with approximately \$5.6 trillion in assets.

Moreover, Vanguard has the best index funds because of their ability to keep their operating fees so low. Vanguard has all types of stock and bond index funds and their fees are the lowest.

CIT Savings Builder – Earn 0.85% APY. Here’s how it works: Make at least a \$100 minimum deposit every month. Or Maintain a minimum balance of \$25k. Member FDIC. Click Here to Learn More.

### Pros of the best vanguard index funds

By now, you know that an index fund is well diversified. But you might know these two other pros that make Vanguard index funds the best:

• Good return: Vanguard index funds generally delivers a good return because their expenses are relatively low. The average Vanguard Index fund has an expense ratio of 0.2% per year (compare that to the average index fund operating expenses of 1.4% per year.) A 1.2% difference can be a significant difference on your return. Operating expenses are also lower because ongoing research is not needed to identify companies to invest in.
• Tax-friendly: not only Vanguard index funds have lower operating expenses, which help increase your returns, they are also tax-friendlier when you invest outside of retirement accounts. Because a mutual fund is actively managed, they tend to jump around by selling and buying stocks more frequently. By doing that, it increases a fund’s taxable capital gains distribution. Whereas an index fund stays invested and not trying to jump around.

### Cons of the best Vanguard index funds

Despite their low costs and tax-friendliness, their minimum investment while seem reasonable, might not be for the beginner investor with little money to invest.

Most Vanguard index funds requires a \$3,000 minimum initial investment. Retirement account investors who plan on starting with less might be at a disadvantage.

Moreover, Vanguard has an overwhelming number of index funds to choose from. That can make it tedious for an investor to decide which ones are the best. But that’s why we have compiled the top Vanguard index funds for you.

## The 10 Best Vanguard Index Funds to Buy in August 2020:

Now that you know what an index fund is and why investing Vanguard index funds makes good sense, in no particular order, below are 10 of the best Vanguard index funds to add to your investment portfolio.

### Vanguard S&P 500 Index Admiral (VFIAX)

Of all the Vanguard index funds in this list, the Vanguard S&P index fund, which tracks the Standard & Poor’s 500, is perhaps the best Vanguard index fund. One reason is that the fund invest in 500 of largest U.S. companies with a few a midsize stocks.

Some of the big name stocks in this index fund includes Apple (AAPL), Microsoft (MSFT), and Google/Alphabet (GOOGL). Another reason to select this fund is that the cost is pretty low, (0.04%) if not the lowest of all the index funds.

Index fund cost is an important factor in choosing an index fund to invest in, because fees are deducted from your balance and thus reduced your rate of returns. The last reason to invest in the VFIAX is because the initial minimum investment is also low (\$3,000).

So if you’re looking for an index fund that maintains low operating expenses while enjoying a good rate of return, the Vanguard S&P 500 Index Admiral is for you.

### Vanguard Developed Market Stock Index Admiral

For diversification, you should consider in your investment portfolio some index funds that invests in foreign countries. International funds are diversified because they invest in countries around the world. If so, the Vanguard Developed Market Stock Index Admiral fund (VTMGX) is a fine choice.

This Vanguard index fund tracks the performance of the FTSE Developed All Cap ex US Index. It invests in large cap stocks in 24 developed countries. Some of its several blue-chip multinational companies include the Toyota Motor Corp (7203), Royal Dutch Shell (RDS.A.), Nestle SA (NESN), making it one of the best Vanguard index funds.

This index fund has a minimum investment of \$3,000 and an expense ratio of 0.07%.

### Vanguard Emerging Markets Stock Index Admiral

While Vanguard index funds invested in U.S. stocks tend to perform better than Vanguard index funds invested in emerging markets, emerging markets in Latin America, Asia, and Eastern Europe should not be overlooked.

If you don’t mind investing in emerging economies, consider checking out the Vanguard Emerging Markets Stock Index Admiral (VEMAX), which is currently one of the best Vanguard index funds to buy now.

In fact, some of the big name foreign companies included in this index fund are Alibaba Group Holding Ltd ADR (BABA), Tencent Holdings Ltd (TCEHY), Taiwan Semiconductor Manufacturing Co Ltd (2330.TW), and China Construction Bank Corp Class H (00939).

This investment attempts to track the performance of the FTSE Emerging Markets All Cap China Inclusion Index.

One of the downside of this index fund is that it has an expense ratio of 0.14%, but it still has a low minimum initial investment of \$3,000.

### Vanguard Total Stock Market Index (VTSAX)

The Vanguard Total Stock Market Index (VTSAX) is one of the best Vanguard index funds. It captures the total market.

That means it gives investors broad exposure to the entire U.S. equity market including large cap, mid cap and small cap growth and value stocks.

Some of the big name companies included in this Vanguard fund are: Facebook, Alphabet, JPMorgan Chase, Apple, and Microsoft.

This Vanguard index fund has an expense ratio of 0.04% and a minimum initial investment of \$3,000.

So, if you’re looking for a well diversified Vanguard fund and don’t mind a little volatility, this index fund is for you.

Note that you can purchase this index fund as an ETF as well. It start at the price of one share.

The Vanguard Mid-Cap Index Admiral fund (VIMAX), which tracks the CRSP U.S. Midcap Index, may be appropriate for you if you have a long term perspective.

That is because the index fund, which consists of midsize and smaller stocks, performs better in the long term rather than the short term, making it one of the best Vanguard index funds to include in your investment portfolio.

The fund targets midsize companies. The minimum investment is \$3,000 with an operating expense of 0.05%.

So if you’re looking for a Vanguard index fund to use for retirement investing and you don’t expect to tap into your investment money for 10 years or more, the Vanguard Mid-Cap Index Admiral fund is for you.

The Vanguard Small-Cap Index Admiral (VSMAX), as the name suggests invests in stocks of smaller companies.

This index fund tracks the CRSP U.S. Small Cap Index. Some of its holdings include DocuSign, Inc (DOCU), Leidos Holdings Inc (LDOS), Tyler Technologies, Inc (TDY), Equity Lifestyle Properties, Inc (ELS), etc…

This index fund, just like the Vanguard Mid-Cap Index Admiral fund, tends to perform better in the long term. Therefore, invest in this Vanguard fund if you don’t plan to use your money within the next five years.

So if you’re looking for a broadly diversified index of stocks of small U.S. companies, the Vanguard Small-Cap Index Admiral is a good choice. This index fund has a minimum initial investment of \$3,000 and an expense ratio of 0.05%.

### Vanguard Short-Term Corporate Index Admiral

If you want to invest in short term bonds to use your money in the next five years to buy a house, or if you plan to withdraw the money from your retirement account, then the Vanguard Short-Term Corporate Index Admiral fund (VSCSX) is for you.

This bond index fund tracks the performance of the Bloomberg Barclays U.S. 1-5 Year Corporate Bond Index.

While you shouldn’t expect a return of no more than 2 to 3% annually on this bond index fund, corporate bonds in general are safe, and this fund is pretty stable.

Because of this stability, this short-term bond index fund makes it an appropriate investment. The Vanguard Short-Term Corporate Index Admiral has an expense ratio of 0.07% expense and a minimum initial investment of \$3000, making it one of the best Vanguard index funds around.

### Vanguard High Dividend Yield ETF

The Vanguard High Dividend Yield ETF (VYM), as the name suggests, is a “dividend” fund. It attempts to track the performance of the FTSE High Dividend Yield Index.

This index ETF allows investors to earn dividend through growth companies. Some of the big companies with a strong record of paying dividends are AT&T, Intel, and Exxon Mobil.

As of 2/27/2020, this ETF has an expense ratio of 0.06%, making it one of the best Vanguard index funds for income. It starts at the price of one share.

So, if you’re looking for an index fund with the best long term investments growth potential, and you don’t mind the stock market volatility, this income-focused fund is appropriate for you.

Note that the Vanguard High Dividend Yield is also available as an Admiral share with a minimum investment of \$3,000.

### Vanguard Information Technology

Vanguard Information Technology Index Fund Admiral Shares (VITAX) is a sector fund. This investment attempts to track the performance of the MSCI US Investable Market/Information Technology 25/50.

Sector funds invest in stocks and/or bonds in specific industries. And the Vanguard Information Technology Index Fund, as the name suggests, focuses only on technology.

Generally, you should avoid sector funds mainly because they lack diversification. However, there is an exception with this Vanguard index fund. It focuses on technology, which makes it one of the best Vanguard funds.

In addition, this index is made up of stocks of large, mid-size, and small U.S. companies within the technology sector.

Nowadays, technology has shaped our daily lives. From computers, TVs, tablets, etc, everything is connected to the internet. Therefore, this means that there is and there will be continued growth in the years ahead.

The top companies included in this Vanguard fund are Apple, Microsoft, Visa, Adobe, PayPal, etc.

This index fund has an expense ratio of 0.10 %, but a minimum investment of \$100,000. This can be high for the beginner investor.

However, this Vanguard index fund is available as an ETF, starting at the price of one share.

### Vanguard Real Estate

The Vanguard Real Estate Index Fund Admiral Shares (VGSLX) is another sector fund. It focuses on real estate investment trusts (REITs), which are companies that buy office buildings, hotels and other real estate properties.

This Vanguard fund seeks to track the performance of the MSCI US Investable Market Real Estate 25/50 index.

Just as any other sector funds, this Vanguard real estate index fund may lack diversification. So, it makes sense to have this index fund in conjunction with another a more broadly diversified Vanguard fund.

Despite the lack of diversification, however, this fund distributes higher dividend income than other funds, allowing it to be among the best Vanguard index funds for income.

This Vanguard fund has an expense ratio of 0.12%. It has a minimum initial investment of \$3,000.

Note that this Vanguard fund is also available as an ETF, starting at the price of one share.

## Final tips for buying the best Vanguard index funds

In general, index funds are a good investment vehicle to use. So whether you’re looking to invest money for retirement, or you’re looking to add diversification to your investment portfolio, these Vanguard index funds are a great choice for you. They are great quality funds. They produce superior returns comparing to other similar funds.

Indeed, the best Vanguard Index funds will not only save you money in fees throughout the years. But also, these low-cost index mutual funds and exchange-traded funds (ETFs) will give you a wide exposure to different asset classes.

## Speak with the Right Financial Advisor

• If you have questions beyond knowing which of the best Vanguard index funds to invest, you can talk to a financial advisor who can review your finances and help you reach your goals (whether it is making more money, paying off debt, investing, buying a house, planning for retirement, saving, etc).
• Find one who meets your needs with SmartAssetâs free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

The post The 10 Best Vanguard Index Funds to Buy appeared first on GrowthRapidly.

Source: growthrapidly.com

## 4 Easy Ways To Get Started With Real Estate Investing

If you’ve never considered real estate investing because you don’t want to own rental properties or be a landlord, you may want to look at these options.

The post 4 Easy Ways To Get Started With Real Estate Investing appeared first on Bible Money Matters and was written by Marc. Copyright Â© Bible Money Matters – please visit biblemoneymatters.com for more great content.

Source: biblemoneymatters.com

## Fractional Shares: What They Are and How to Buy Them

Investing in fractional shares can help make certain investments more accessible. Learn what they are and how to invest in them.

Source: goodfinancialcents.com

## How to Start Investing in the Stock Market

Although investing in the stock market can feel intimidating at first, it could be the key to achieving your financial goals. Short of hitting the lottery or building a thriving business that you can sell, buying securities that increase in value over time is usually the easiest path to wealth.

After all, the average savings account pays out a paltry 0.05% APY according to the Federal Reserve Bank of St. Louis, yet the average stock market return is around 10% per year before accounting for inflation.Â

Unless you want your money to languish in a savings account where itâs worth less with each passing year, learning to invest should be at the top of your to-do list.

## 6 Steps to Start Investing in the Stock Market

But, how do you start down a path that is notoriously complicated and has the potential to leave you with less money than you started? Here are a few top steps you should take to get started.

Ask yourself what you hope to accomplish by investing in the stock market. A few examples of investment goals might include:

• Making a quick profit by investing in the short-term, and reselling stocks at a higher price,
• Creating a source of passive income you can use later on,
• Growing investment earnings so it can cover your retirement, or
• Saving money for a specific goal.

As you list out your goals, make sure you have the extra money to invest on a regular basis, while also having cash set aside for emergencies. If you have a lot of credit card debt or other high-interest debt, you might even consider paying it off before you begin investing. After all, the average credit card interest rate is currently over 16% â  and you might not get an investment return anywhere close to that.

There are advantages that come with investing in a retirement account. Accounts, like a workplace 401(k), a SEP IRA, or a Solo 401(k) are tax-advantaged, giving you the chance to reduce your taxable income (and thus, pay less in taxes) when you contribute.

With a 401(k) plan from your job, for example, you can contribute up to \$19,500 in 2020 and again in 2021. If youâre age 50 or older, you can also contribute another \$6,500 each year which is called, a âcatch-up contributionâ. The amount you contribute is taken off of your taxable income, so your tax liability is lower.

You might also qualify for an âemployer matchâ on contributions to your employer-sponsored retirement account. Check with your companyâs human resource department to learn if your employer offers this benefit.

Other retirement accounts to consider include a traditional or Roth IRA. You can deduct your full traditional IRA contribution from your taxable income, if you donât have a retirement plan at work. Another option is funding a Roth IRA which lets you contribute using after-tax dollars instead. This means you wonât get a tax deduction for contributing, but Roth IRA funds grow tax-free and you can take distributions at retirement age without paying any taxes.Â

In 2021, contribution limits for IRAs stay the same as 2020. You can contribute up to \$6,000 to an IRA, or \$7,000 if youâre age 50 and older.

### 3. Open a Brokerage Account

In addition to investing for retirement, you can also open a taxable brokerage account. You wonât get any upfront tax advantages for opening a brokerage account, but you get the chance to buy and sell stocks and other securities, or buy and hold them for the long-term.

There are excellent brokerage account options for beginners or experienced investors, many of which let you invest in some capacity without any fees. Some of the top firms to consider include:Â

• Betterment: Best for Beginners
• Robinhood: Best for No Minimum Balance Requirement

### 4. Compare Costs and Fees

You might not have a lot of options if youâre investing in your workplace retirement plan at first. If you have the option to select a brokerage firm, youâll need to compare the fees and costs involved in investing. Fees and costs to watch out for include:

• Investment management fees. These fees can be nonexistent or as high as 1% of your account balance (or more).
• Expense ratios. Specific funds, like index funds or mutual funds, might carry this fee.
• Transaction fees. You might pay transaction fees when buying or selling a stock or another security.
• Front-end loads. This fee can be charged on some investments upfront.
• Annual account fees. A charge thatâs tacked on just for using your brokerage account.

These are just some of the main fees to watch out for, but there are plenty of others. If you want to figure out how much youâre paying in fees on your investment accounts, the free retirement fee analyzer tool from Personal Capital is a good place to start.

### 5. Start Off With Simple Investments

Youâve probably heard plenty about the âhot stocksâ of the last few years, and how investors who got in early have gotten rich by being in the right place, at the right time. Unfortunately, most âregularâ investors donât hear about hot stocks until itâs too late.

As a beginning investor, itâs usually best to keep your stock market strategy simple by investing in what you understand. Some beginning investments to consider include exchange-traded funds (ETFs), which are made up of various investments that track an index or focus on a specific industry sector. You could even stick to index funds, which are another type of investment that tracks an index and are mostly âhands-offâ for the investor.

Target-date funds are another type of simple investment to consider. These funds include a selection of stocks and bonds that adjust for less risk over time. If you purchase a target-date fund thatâs meant to last until 2050, for example, your risk would be high at first but slowly taper down as you approached 2050 or whatever âtarget dateâ you choose for retirement.

### 6. Research Before Jumping on Complex Strategies

If youâre curious about more complex investing options, youâll need to learn more about how and when to invest. Some resources to turn to include investing books, like:

• The Little Book of Common Sense Investing by John C. Bogle
• Investing All-In-One for Dummies by Eric Tyson

You could also check out top investing forums like Seeking Alpha or the Bogleheads forum, taking the time to read through questions and answers from investors at the top of their game.

Blog posts that can help you get started with some investing basics include:

• How to Invest Essentials for Beginners & Intermediates
• How the Stock Market Works
• How to Buy Stock Online

## The Bottom Line

Investing in the stock market can be nerve-racking, but starting with common-sense investments in place (e.g. employer-sponsored retirement account) and uncomplicated investments (like index funds), lets you ease into the process slowly.

Over time and with more experience, youâll have a better sense of when â and when not to â shy away from the risks of the stock market.

The post How to Start Investing in the Stock Market appeared first on Good Financial CentsÂ®.

Source: goodfinancialcents.com

## Managing Multiple Financial Accounts in a Single App: Personal Capital

Personal Capital gives you the tools to understand your financial situation â and you can use that information to reach your goals. Here’s how.

The post Managing Multiple Financial Accounts in a Single App: Personal Capital appeared first on The Dough Roller.

Source: doughroller.net