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Anonymous

Re-Investing Savings bonds.
    #13330869 - 10/13/10 01:03 PM (13 years, 5 months ago)

a

Edited by Anonymous (03/11/12 04:06 PM)

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OfflineToltecatl
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Registered: 07/29/10
Posts: 641
Loc: Tardis
Last seen: 10 years, 10 months
Re: Re-Investing Savings bonds. [Re: Anonymous]
    #13330949 - 10/13/10 01:17 PM (13 years, 5 months ago)

Look into a Roth IRA. I have one with Scottrade. it's free. The great thing about a Roth IRA is when you take that money out it doesn't get taxed because you  are using money that you have already paid taxes with. Check it out


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Invisiblebadchad
Mad Scientist

Registered: 03/02/05
Posts: 13,377
Re: Re-Investing Savings bonds. [Re: Anonymous]
    #13331053 - 10/13/10 01:35 PM (13 years, 5 months ago)

Are you planning anything career wise?  If so, you may want to look into a company retirement program.  A "matching" program will probably outperform most investment options on the market.


--------------------
...the whole experience is (and is as) a profound piece of knowledge.  It is an indellible experience; it is forever known.  I have known myself in a way I doubt I would have ever occurred except as it did.

Smith, P.  Bull. Menninger Clinic (1959) 23:20-27; p. 27.

...most subjects find the experience valuable, some find it frightening, and many say that is it uniquely lovely.

Osmond, H.  Annals, NY Acad Science (1957) 66:418-434; p.436

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Anonymous

Re: Re-Investing Savings bonds. [Re: badchad]
    #13331222 - 10/13/10 02:11 PM (13 years, 5 months ago)

I’m still in school.  I am working, and plan to pursue a career in the field im currently working in.  But im part time, and don’t believe I qualify for such things.  I have a lot planned career wise, but won’t be making any real money for another year or so.  And that is IF I enter the field before pursuing a Masters degree, which is still undecided.

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Offlinepothead_bob
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Posts: 1,811
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Re: Re-Investing Savings bonds. [Re: Anonymous] * 1
    #13335392 - 10/14/10 11:27 AM (13 years, 5 months ago)

Open up a Roth IRA with Vanguard and buy the STAR fund.  It is a blended fund, meaning it is well-diversified, which will manage your risk.  It invests in large cap stocks, small cap stocks, values stocks and growth stocks both foreign and domestic, as well as government and corporate bonds.  Unlike all of Vanguard's other funds, which require minimum investments of $3,000, the STAR fund only requires a $1,000 minimum investment, which is good for you.  There are no brokerage fees like if you buy stocks through a site like scottrade, the cost of ownership is very low, and you can make additional investments of as little as $100 when you feel like adding more to the fund.  You can also set the dividends to automatically reinvest.  If you're gonna buy the fund in a Roth, you just gotta remember that you can only invest as much as you've earned in the year, so if you didn't make more than the $2,000 you'll be investing, you'll have to buy the fund in a taxable account.  Anyway, remember that the key to successful investing is to start as young as possible.  Compounding interest + time = a marvelous thing.


--------------------
No knowledge can be certain, if it is not based
upon mathematics or upon some other knowledge
which is itself based upon the mathematical
sciences.
  -Leonardo da Vinci (1425-1519)

Speak well of your enemies.  After all, you made them.

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Anonymous

Re: Re-Investing Savings bonds. [Re: pothead_bob]
    #13335794 - 10/14/10 01:05 PM (13 years, 5 months ago)

pothead_bob,

A couple questions, what kind of average interest does the STAR fund yield?  Also, what kind of protection does a person have?  I’d like to do a 40 year investment, a lot can change over 40yrs, what happens if Vanguard goes under/ doesn’t exist anymore?  What happens to my investment?

Also, I just started working this year in May.  Any previous work wasn’t legit taxable income like it is now. 
So let me try to get this straight.  As long as I have made over 2k in taxable income so far this year I am good to go, even if I have not filed taxes yet?  And haven’t in the past?  Right?

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Offlinepothead_bob
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Registered: 04/12/08
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Re: Re-Investing Savings bonds. [Re: Anonymous] * 1
    #13335835 - 10/14/10 01:14 PM (13 years, 5 months ago)

SEC yield as of 10/13 was 2.3%.  1, 3, 5, and 10 year performance was 9.28%, -.89%, 3.73%, and 4.76%, respectively.  Past performance, though, is not an indication of future performance.  See more info at Vanguard:

https://personal.vanguard.com/us/funds/snapshot?FundId=0056&FundIntExt=INT

The key is it is a highly diversivied investment utility.  You get a lot of bang for your buck.  If you instead buy a stock, you just get that one stock, in that one sector of the economy and are held hostage to the potential pitfalls of that particular company's business decisions.

Vanguard, I believe, is the world's biggest mutual fund manager and I think it is unlikely that they are running some kind of Ponzi scheme and planning to take peoples' money.  The asset classes you are invested in might decline, which would subsequently cause a decline in the index fund value, but that's a risk you'll take with any investment, really.

Each year, you can contribute $5,000 to your Roth IRA, at most.  This assumes you made at least $5,000 in that same year.  Obviously, the income has to be reported.  So long as you made over $2,000 in income this year (2010) that you will claim when you do your taxes next spring, you can contribute $2,000 to a Roth IRA. It doesn't matter what you did in the past.


--------------------
No knowledge can be certain, if it is not based
upon mathematics or upon some other knowledge
which is itself based upon the mathematical
sciences.
  -Leonardo da Vinci (1425-1519)

Speak well of your enemies.  After all, you made them.

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