I'm not much older than you but I've been in the finance world for some time now and give the following advice when friends ask.

1.) You don't need a broker or someone you have to pay to manage your money.

2.) Your outlook should be one of set it and forget it. That is, you don't want this money to be money you need on day to day basis. This is money you want to set aside and let it work for you. And you need to be OK with being apart from that money for some time in order to realize actual growth.

3.) Find a platform that suits you and doesn't hit with crazy fees and has a minimum deposit you can handle. Something like E-Trade, Merrill Edge, TDAmeritrade, etc. Open an IRA through whatever platform you choose. Google IRAs first to make sure it's something you want and understand the basic rules.

4.) Find some high growth funds. Vanguard US Growth, Fidelity blue chip, TRowe Cap, etc. All these guys generally invest in the same stuff so don't split hairs over which fund. Google some and read about it and pick ones that suit you. Consider setting up smaller recurring contributions that coincide with when you get paid. Again, only do what you can afford to part with.

4.a) Or you could use the auto-advisor service that some of these things offer - some may charge for this so careful here. The goal would be to pick growth given your age and the current market climate, should it hold.

5.) In addition to mutual funds, consider looking at blue chip stocks that perform consistently and have 2-5% dividend yield. Things like Coke, Duke, 3M, IBM etc. Throw some money in those and set those puppies to reinvest the dividends and you'll realize growth that way as well. I always include this bit about stocks in the event you hit the maximum deposit for an IRA - 6k for someone your age for 2021. So if you plan on investing more than 6k, consider stocks in just a basic account through the same platform.

**DISCLOSURE** I'm not a financial advisor. I'm a software developer that works in finance and have many broker friends.

metcalfmafia said:

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Bumping this to the top with a question:

For the folks on this board with more years under their belt than mine...

What is the one bit of advice you would give someone in their late 20s on investing in mutual funds. Trying to get into it now so I'm not regretting it later. Thanks in advance!

---

I dont think I am too much older than you, but the answer completely depends on what your goals are. Is it something you think youll need in the next few years? Is it a retirement account?

One great piece of advice I got fairly early on in my career - always be able to answer the question of why. Why are you putting money into a particular stock/mutual fund/index. Once you know why, its much easier to figure out what you want to do.

One word of caution with mutual funds - figure out where the fees are going. There are some out there with massively bloated fees and it makes it much harder to stay positive in ROI. I am personally a big fan of index funds over mutual funds, but they are more volatile. Much like mrc said, my strategy is to pretty much set it and forget it. In an ideal world, I wont touch any of my accounts for years with regards to withdrawals. I realize thats probably not feasible, but thats the goal. If I do have to dip into them, I know exactly where Ill start and what stays in the market.

mrcpack17 said:

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I'm not much older than you but I've been in the finance world for some time now and give the following advice when friends ask.

1.) You don't need a broker or someone you have to pay to manage your money.

2.) Your outlook should be one of set it and forget it. That is, you don't want this money to be money you need on day to day basis. This is money you want to set aside and let it work for you. And you need to be OK with being apart from that money for some time in order to realize actual growth.

3.) Find a platform that suits you and doesn't hit with crazy fees and has a minimum deposit you can handle. Something like E-Trade, Merrill Edge, TDAmeritrade, etc. Open an IRA through whatever platform you choose. Google IRAs first to make sure it's something you want and understand the basic rules.

4.) Find some high growth funds. Vanguard US Growth, Fidelity blue chip, TRowe Cap, etc. All these guys generally invest in the same stuff so don't split hairs over which fund. Google some and read about it and pick ones that suit you. Consider setting up smaller recurring contributions that coincide with when you get paid. Again, only do what you can afford to part with.

4.a) Or you could use the auto-advisor service that some of these things offer - some may charge for this so careful here. The goal would be to pick growth given your age and the current market climate, should it hold.

5.) In addition to mutual funds, consider looking at blue chip stocks that perform consistently and have 2-5% dividend yield. Things like Coke, Duke, 3M, IBM etc. Throw some money in those and set those puppies to reinvest the dividends and you'll realize growth that way as well. I always include this bit about stocks in the event you hit the maximum deposit for an IRA - 6k for someone your age for 2021. So if you plan on investing more than 6k, consider stocks in just a basic account through the same platform.

**DISCLOSURE** I'm not a financial advisor. I'm a software developer that works in finance and have many broker friends.

---

Wow thanks for the detailed answer!

I definitely want to set it and forget it since this is more for retirement purposes. I have a Roth IRA through work that has a pretty good rate of return on it right now. Are you saying I could open up another IRA instead of just using a brokerage account?

metcalfmafia said:

---

mrcpack17 said:

---

I'm not much older than you but I've been in the finance world for some time now and give the following advice when friends ask.

1.) You don't need a broker or someone you have to pay to manage your money.

2.) Your outlook should be one of set it and forget it. That is, you don't want this money to be money you need on day to day basis. This is money you want to set aside and let it work for you. And you need to be OK with being apart from that money for some time in order to realize actual growth.

3.) Find a platform that suits you and doesn't hit with crazy fees and has a minimum deposit you can handle. Something like E-Trade, Merrill Edge, TDAmeritrade, etc. Open an IRA through whatever platform you choose. Google IRAs first to make sure it's something you want and understand the basic rules.

4.) Find some high growth funds. Vanguard US Growth, Fidelity blue chip, TRowe Cap, etc. All these guys generally invest in the same stuff so don't split hairs over which fund. Google some and read about it and pick ones that suit you. Consider setting up smaller recurring contributions that coincide with when you get paid. Again, only do what you can afford to part with.

4.a) Or you could use the auto-advisor service that some of these things offer - some may charge for this so careful here. The goal would be to pick growth given your age and the current market climate, should it hold.

5.) In addition to mutual funds, consider looking at blue chip stocks that perform consistently and have 2-5% dividend yield. Things like Coke, Duke, 3M, IBM etc. Throw some money in those and set those puppies to reinvest the dividends and you'll realize growth that way as well. I always include this bit about stocks in the event you hit the maximum deposit for an IRA - 6k for someone your age for 2021. So if you plan on investing more than 6k, consider stocks in just a basic account through the same platform.

**DISCLOSURE** I'm not a financial advisor. I'm a software developer that works in finance and have many broker friends.

---

Wow thanks for the detailed answer!

I definitely want to set it and forget it since this is more for retirement purposes. I have a Roth IRA through work that has a pretty good rate of return on it right now. Are you saying I could open up another IRA instead of just using a brokerage account?

---

It is a Roth 401k or a Roth IRA? If its the 401k, I would look at opening a Roth IRA if its for retirement outside of work. As the money going in is after taxes, any gains on the account when taken out are tax free (as of now, at least). Funding my Roth is top priority each year before I even touch brokerage.

FlossyDFlynt said:

---

metcalfmafia said:

---

mrcpack17 said:

---

I'm not much older than you but I've been in the finance world for some time now and give the following advice when friends ask.

1.) You don't need a broker or someone you have to pay to manage your money.

2.) Your outlook should be one of set it and forget it. That is, you don't want this money to be money you need on day to day basis. This is money you want to set aside and let it work for you. And you need to be OK with being apart from that money for some time in order to realize actual growth.

3.) Find a platform that suits you and doesn't hit with crazy fees and has a minimum deposit you can handle. Something like E-Trade, Merrill Edge, TDAmeritrade, etc. Open an IRA through whatever platform you choose. Google IRAs first to make sure it's something you want and understand the basic rules.

4.) Find some high growth funds. Vanguard US Growth, Fidelity blue chip, TRowe Cap, etc. All these guys generally invest in the same stuff so don't split hairs over which fund. Google some and read about it and pick ones that suit you. Consider setting up smaller recurring contributions that coincide with when you get paid. Again, only do what you can afford to part with.

4.a) Or you could use the auto-advisor service that some of these things offer - some may charge for this so careful here. The goal would be to pick growth given your age and the current market climate, should it hold.

5.) In addition to mutual funds, consider looking at blue chip stocks that perform consistently and have 2-5% dividend yield. Things like Coke, Duke, 3M, IBM etc. Throw some money in those and set those puppies to reinvest the dividends and you'll realize growth that way as well. I always include this bit about stocks in the event you hit the maximum deposit for an IRA - 6k for someone your age for 2021. So if you plan on investing more than 6k, consider stocks in just a basic account through the same platform.

**DISCLOSURE** I'm not a financial advisor. I'm a software developer that works in finance and have many broker friends.

---

Wow thanks for the detailed answer!

I definitely want to set it and forget it since this is more for retirement purposes. I have a Roth IRA through work that has a pretty good rate of return on it right now. Are you saying I could open up another IRA instead of just using a brokerage account?

---

It is a Roth 401k or a Roth IRA? If its the 401k, I would look at opening a Roth IRA if its for retirement outside of work. As the money going in is after taxes, any gains on the account when taken out are tax free (as of now, at least). Funding my Roth is top priority each year before I even touch brokerage.

---

It is a Roth 401k, so I'll look into a Roth IRA.

You cannot contribute more than 6k total in Roths though, correct?

6k this year as long as your AGI is under 125k (assuming youre single)

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits

My non financial adviser advice is

1. to invest as much as you can as early as you can to maximize your time in the market.

2. If your 401k is pretty robust with options for investing and low fees, I'd look to maximize that contribution out first before opening up a separate IRA account. That way the money is "gone" before it hits your bank account. Or set up auto investments into your IRA that hit the same day your direct deposit hits your bank account.

3. Make sure you have emergency savings account with a minimum of 3 months up to 6 months of monthly expenses

4. A home is not an investment unless you are renting it or a portion of it out for income. Don't feel pressure to buy a home because it's the "grown up thing to do."

5. Sit down and do a monthly budget and get disciplined with your spending. You'd be surprised what you'll find you spend money on that you could save and invest

6. Do your research, listen to podcasts, read articles and books to get a basic understanding of what you're doing and have clear retirement goals

7. Whatever you can invest now is great, don't be concerned too much about the amount, just that you're doing it.

I personally am a value investor and my portfolio is tilted towards value and small cap value. It's the approach that I've researched and decided is the best for me.

hokiewolf said:

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My non financial adviser advice is

1. to invest as much as you can as early as you can to maximize your time in the market.

2. If your 401k is pretty robust with options for investing and low fees, I'd look to maximize that contribution out first before opening up a separate IRA account. That way the money is "gone" before it hits your bank account. Or set up auto investments into your IRA that hit the same day your direct deposit hits your bank account.

3. Make sure you have emergency savings account with a minimum of 3 months up to 6 months of monthly expenses

4. A home is not an investment unless you are renting it or a portion of it out for income. Don't feel pressure to buy a home because it's the "grown up thing to do."

5. Sit down and do a monthly budget and get disciplined with your spending. You'd be surprised what you'll find you spend money on that you could save and invest

6. Do your research, listen to podcasts, read articles and books to get a basic understanding of what you're doing and have clear retirement goals

7. Whatever you can invest now is great, don't be concerned too much about the amount, just that you're doing it.

I personally am a value investor and my portfolio is tilted towards value and small cap value. It's the approach that I've researched and decided is the best for me.

---

Great stuff. It truly is appreciated.

Are you all of the mindset that paying off debt outweighs the value of getting into the market early?

Student loans are a *****. Not saying you can't do both...which is what I'm doing.

All good advice, but I disagree with number 4 given how low interest rates are on loans at the moment. If you can afford it without busting your monthly budget (and can afford the down payment), property can be a great investment. Its certainly not for everyone and I would never tell someone to do it "because its the grown up thing to do", but I bought my first house four years ago and will come out WAY ahead whenever I end up selling it.

metcalfmafia said:

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Are you all of the mindset that paying off debt outweighs the value of getting into the market early?

Student loans are a *****. Not saying you can't do both...which is what I'm doing.

---

I would most definitely do both.

The earlier you invest, the longer it has to grow -- no matter the amount.
Someone else may have the exact numbers/percentages on hand, but to paraphrase.... Waiting until you're 30 to start investing in a 401k, as opposed to starting when you're 25, is basically giving up X-amount of dollars. (in the tens of thousands, etc.)

So no matter how small of an amount, be sure to invest SOMETHING every month when you're young. With compound interest, it will grow and grow.

If every high school grad was disciplined enough to make and then put $1,000 into a Roth IRA on the day he/she turned 18, the world would be a different place.

I like threads like these, seeing all the different ways people invest/save. I am not a great investor but I am very very good at saving.

I am all about growing wealth which in my case means saving for retirement and honestly allowing me to do what I want to do for the next 5 to 10 years of my working life.

Some points:

1) Realize taxes are your largest expenses. Minimize as best you can.
2) Budget and follow your budget.
3) Target saving a percentage of your salary. I target saving 30% of my gross salary.
4) Pay yourself first. Put your savings aside then the rest is for your budget.
5) Start as early as you can.

Nothing really new but they work for me.

WolfpackCPA said:

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Don't buy GameStop is my only advice

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That has been wild to follow from the sidelines

It was kind of touched on above but what is the consensus on paying down student debt now while interest is frozen?
We have continued to pay basically the same amount as always (my impression is that it's all going toward principle). But the other options are investing or savings.
We have some low risk investments in stocks, 401k and are decent in saving but could always be better.

metcalfmafia said:

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Are you all of the mindset that paying off debt outweighs the value of getting into the market early?

Student loans are a *****. Not saying you can't do both...which is what I'm doing.

---

I am not, Time in the market will far exceed your interest saved on student loans unless you got your student loans from a loan shark.

For instance, If for one year in your 20s if you maximized out your 401k contribution and then maximized out a Roth contribution with a modest rate of return, you'll be a millionaire in 30 years.

hokiewolf said:

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metcalfmafia said:

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Are you all of the mindset that paying off debt outweighs the value of getting into the market early?

Student loans are a *****. Not saying you can't do both...which is what I'm doing.

---

I am not, Time in the market will far exceed your interest saved on student loans unless you got your student loans from a loan shark.

For instance, If for one year in your 20s if you maximized out your 401k contribution and then maximized out a Roth contribution with a modest rate of return, you'll be a millionaire in 30 years.

---

Agreed here. My only caveat if you are almost done paying student loans and think the market will be down for a couple of years then I could make sense to pay off the loans.

Good luck trying to predict the market!

FlossyDFlynt said:

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WolfpackCPA said:

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Don't buy GameStop is my only advice

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That has been wild to follow from the sidelines

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AMC is apparently next

griff17matt said:

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FlossyDFlynt said:

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WolfpackCPA said:

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Don't buy GameStop is my only advice

---

That has been wild to follow from the sidelines

---

AMC is apparently next

---

I love to gamble more than most, but thats an extremely expensive game of chicken vs a group that has access to way more assets than I do. Ill sit and watch the fireworks

FlossyDFlynt said:

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griff17matt said:

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FlossyDFlynt said:

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WolfpackCPA said:

---

Don't buy GameStop is my only advice

---

That has been wild to follow from the sidelines

---

AMC is apparently next

---

I love to gamble more than most, but thats an extremely expensive game of chicken vs a group that has access to way more assets than I do. Ill sit and watch the fireworks

---

The Reddit revolution is here brother LOL

metcalfmafia said:

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FlossyDFlynt said:

---

griff17matt said:

---

FlossyDFlynt said:

---

WolfpackCPA said:

---

Don't buy GameStop is my only advice

---

That has been wild to follow from the sidelines

---

AMC is apparently next

---

I love to gamble more than most, but thats an extremely expensive game of chicken vs a group that has access to way more assets than I do. Ill sit and watch the fireworks

---

The Reddit revolution is here brother LOL

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Its here for now. Ill be shocked if the SEC lets it continue

I bought some blackberry stock as I saw it was going to be one of the next ones the Reddit people were going to mess with. Obviously, I'm up a bit on it. Should I sell it now before it tanks? And are there any legal implications to this? Admittedly, I'm one of those small time robinhood traders (with my real investments in my 401k, etc handled by professionals).

SportManagementEngineer said:

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I bought some blackberry stock as I saw it was going to be one of the next ones the Reddit people were going to mess with. Obviously, I'm up a bit on it. Should I sell it now before it tanks? And are there any legal implications to this? Admittedly, I'm one of those small time robinhood traders (with my real investments in my 401k, etc handled by professionals).

---

I think you should be fine as long as its publicly available information. On the other hand if your getting a tip from a guy who knows a secretary working at blackberry that overheard a board meeting then I may not touch that.....

FlossyDFlynt said:

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griff17matt said:

---

FlossyDFlynt said:

---

WolfpackCPA said:

---

Don't buy GameStop is my only advice

---

That has been wild to follow from the sidelines

---

AMC is apparently next

---

I love to gamble more than most, but thats an extremely expensive game of chicken vs a group that has access to way more assets than I do. Ill sit and watch the fireworks

---

Depends. They're only going after this stuff b/c they're shorting the stocks. The way I understand shorting stocks, it essentially comes down to how long can the hedge fund hold their position vs how long can 1mm people hold the stock. Melvin Capital had to have a 2.75bb loan from other hedge funds to stay solvent because of this ONE SHORT. Wall Street will just learn to not squawk about which companies they're taking down in the future.

The best thing that will come of this is for people to realize if they band together, they can save something they love. I think they saved GameStop for a bit b/c they wanted to stick it to Wall Street. They're saving AMC because they see the value add theaters provide to society at large. That's great to see, imo.

cowboypack02 said:

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SportManagementEngineer said:

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I bought some blackberry stock as I saw it was going to be one of the next ones the Reddit people were going to mess with. Obviously, I'm up a bit on it. Should I sell it now before it tanks? And are there any legal implications to this? Admittedly, I'm one of those small time robinhood traders (with my real investments in my 401k, etc handled by professionals).

---

I think you should be fine as long as its publicly available information. On the other hand if your getting a tip from a guy who knows a secretary working at blackberry that overheard a board meeting then I may not touch that.....

---

I think it's a bit more complicated than that. I've seen some concerns on Twitter from lawyer types that think the SEC might think this is sort of a pump & dump scheme. May be difficult to bring to trial because the scope is so large and you have thousands of people involved that never posted or interacted with reddit/twitter regarding this, but I've seen a lot of guys warn to watch yourself.

metcalfmafia said:

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griff17matt said:

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cowboypack02 said:

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SportManagementEngineer said:

---

I bought some blackberry stock as I saw it was going to be one of the next ones the Reddit people were going to mess with. Obviously, I'm up a bit on it. Should I sell it now before it tanks? And are there any legal implications to this? Admittedly, I'm one of those small time robinhood traders (with my real investments in my 401k, etc handled by professionals).

---

I think you should be fine as long as its publicly available information. On the other hand if your getting a tip from a guy who knows a secretary working at blackberry that overheard a board meeting then I may not touch that.....

---

I think it's a bit more complicated than that. I've seen some concerns on Twitter from lawyer types that think the SEC might think this is sort of a pump & dump scheme. May be difficult to bring to trial because the scope is so large and you have thousands of people involved that never posted or interacted with reddit/twitter regarding this, but I've seen a lot of guys warn to watch yourself.

---

Guess the wrong people are making the money this time huh?

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That's about how it works. Up until a few years ago insider trading wasn't illegal if you were in congress....

With regards to the market, I always say - "What goes up, has to come down (at some point)."

The Gamestop story is interesting and it remains to be seen how long the Reddit guys can keep driving the stock up. It is definitely sticking it to Melvin Capital AND the banks supporting their effort are also taking a big hit. This is always the risk when shorting a stock. If the stock goes up (or does not come down in the prescribed time period), there will be a margin call and the group/person shorting the stock has to come up with the funds to cover the margin. As long as they can continue to access funds for the additional margin calls, they will survive. Once the money runs out, they are toast (along with the banks).

The banks have the Federal Reserve to help them out in the event of a loss of capital, but the investor who is shorting the stock only has the SEC. It is not clear if the SEC will get involved in this particular instance, but I guarantee they are watching this very closely. They are charged with insuring markets are efficient and fair and if they do not believe this to be the case, they have an obligation to act. However, if no rules are currently being broken, they should not be taking action at this time.

Personally, I think the SEC should stay out of this particular case and let it play out. Longer term, they do need to examine what happened and only implement new rules if they believe they are necessary to keep markets fair and efficient. It is interesting to sit on the sidelines and watch it play out.

As an update - I just saw Melvin Capital called "uncle" and conceded defeat. This episode is now over, but it could happen again. Get ready to watch the stock fall now when the people who were helping to play the game get out of the stock. Anyone up for a new game of shorting Gamestop?

cowboypack02 said:

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SportManagementEngineer said:

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I bought some blackberry stock as I saw it was going to be one of the next ones the Reddit people were going to mess with. Obviously, I'm up a bit on it. Should I sell it now before it tanks? And are there any legal implications to this? Admittedly, I'm one of those small time robinhood traders (with my real investments in my 401k, etc handled by professionals).

---

I think you should be fine as long as its publicly available information. On the other hand if your getting a tip from a guy who knows a secretary working at blackberry that overheard a board meeting then I may not touch that.....

---

Yeah I just saw tweets mocking the reddit groups and figured I'd jump on

I still trying to figure out what has happened on the GameSpot deal...

• A group of people in a Reddit group decided to buy GameSpot
• Somehow, Elon Musk backs these guys
• One Capital hedge Fund firm lost a bunch of money

So, the group on Reddit starting buying the stock and drove the price up?
The Hedge Fund firm shorted the stock?

Ultimately, the Hedge Fund firm was betting against the market and lost 3 billion...

Good Twitter thread explaining whats going on

TLDR version - hedge funds shorted the stock (borrowed shares banking that the stock will tank, they can sell at a cheaper price and pocket the difference) and the Reddit crowd bought all the shares and refused to sell, jacking up the price. Well, the options expired and the hedge funds owe the difference, thus creating a huge loss for the hedge funds. And now some hedges are doubling down with the prices skyrocketing on the stock.

Its basically one gigantic game of chicken. Someone is going to get stuck with the bill at some point

FlossyDFlynt said:

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Good Twitter thread explaining whats going on

TLDR version - hedge funds shorted the stock (borrowed shares banking that the stock will tank, they can sell at a cheaper price and pocket the difference) and the Reddit crowd bought all the shares and refused to sell, jacking up the price. Well, the options expired and the hedge funds owe the difference, thus creating a huge loss for the hedge funds. And now some hedges are doubling down with the prices skyrocketing on the stock.

Its basically one gigantic game of chicken. Someone is going to get stuck with the bill at some point

---

Agree, at some point the Reddit guys are holding stock that is over valued. What I like is that they "kind of stuck it to the man" and caused harm.

The CNBC's of the world are all raising hell over this. One guy said: these people (Reddit people) are using this like a casino. I'm sorry, but that's all a Hedge Fund group does is use the market as a casino.

None of us have the access to the markets the same way investment houses have. This, in my opinion, was a populist movement and the Elite's don't like it! I say GOOD!

Reddit nuked r/WallStreetBets and Discord deleted the WSB server. As we saw leading up to the election, big tech censorship is a big, big problem.

FlossyDFlynt said:

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Reddit nuked r/WallStreetBets and Discord deleted the WSB server. As we saw leading up to the election, big tech censorship is a big, big problem.

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They didn't nuke the subreddit. They closed it to get moderation in place to monitor the 1mm new subs they've had in the past 3 days. I think I saw where the subreddit is back up now.

ETA: Discord definitely deleted their server though for some bull**** TOS violation. Discord doesn't want that reddit smoke though. That place will put discord out of business.