NGC Investing Monies

[twodogs]

Hi all, Me and the wife have a little bit of funds and we are getting close to retirement and so far we have a little bit in Edward Jones and we are not real happy about our returns and we were just wondering if there were better options out there, (if this is a no no thread go ahead nuke this), but it seems to me that you folks have a lot better understanding about this sort of thing then we do, any help as always is greatly appreciated. Thanks for any info.
Bruce

[elvisboy77]

Hi all, Me and the wife have a little bit of funds and we are getting close to retirement and so far we have a little bit in Edward Jones and we are not real happy about our returns and we were just wondering if there were better options out there, (if this is a no no thread go ahead nuke this), but it seems to me that you folks have a lot better understanding about this sort of thing then we do, any help as always is greatly appreciated. Thanks for any info.
Bruce

Edward Jones is popular and convenient but they have fees like many places, which waters down your return.  Any "consultant" you use will take a portion of your money.

I would suggest investigating Vanguard.com which has some very low fee and reasonable return choices.  Me, I am an Index-500 investor.  Pretty safe bet over the years relative to many things, and decent returns.

[Arizona Wayne]

I have a stock with Edward Jones but now do my stock trading with Ally Financial in North Carolina. 1-855-880-2559.
$4.95 for transactions and can talk to a person quick and get educated there too on stock market dealings. 

[gearman]

As a long time investor, An Edward Jones salesman used to come to my house to push his push list to me. I would listen but when he was pushing Enron hard I knew that it wasn't for me. Of course a week later we know what happened.The poor guy said later that he had had his own money and lost it all. Be  careful.A lot of these companies own the stocks that they push.

[RinkRat II]

 Hi Bruce, Fun subject and this advice is worth exactly what your paying for it! It really is simple if you do the homework and stick to a plan...
      Put 10,000 in a  S&P index fund.
      Fully fund a Roth IRA for both You and your Wife.
      Google Jim Cramer and read up on his teachings
      Depending on your Debt load you may want to do a "debt snowball" and eliminate as much debt as possible. Google Dave Ramsey.
      Individual stocks are still a viable option. I live in a small town and have to deal with Ed Jones too but if your careful you can minimize the fees.
      For all this to work out you gotta take time and do the homework ....STAY AWAY FROM ANNUITIES.  Have Fun Learning!

        Paul B

[Lannis]

      For all this to work out you gotta take time and do the homework ....STAY AWAY FROM ANNUITIES.  Have Fun Learning!

        Paul B

Why's that?   I'll be starting next month to draw an income stream from an annuity that has worked just as promised since I started paying into it 10 years ago .... The whole point of an annuity is "predictability" - you want to be SURE that you can draw a given amount of money out AT A GIVEN START TIME rather than say (like folks did in 2008) ... "Well, I was GOING to retire but the stock market and the index funds tanked, I can't sell any of it, the dividends suck, and looks like I'll have to wait to retire now till it all comes back ...."

I think they have their place.   

Lannis

[RinkRat II]

 In the simplest terms annuities are simply insurance policies that the issuer is profiting from before paying out. If as an individual you direct where your money goes and returns a profit you can avoid paying someone else to watch your money. Depending on risk tolerance you can outperform any insurance  company.
  You are correct that it is a predictable payout  and for some there is nothing wrong with that as part of a diversified portfolio, there are just more favorable for the investor ways to invest.
     
        Paul B

[Lannis]

Depending on risk tolerance you can outperform any insurance  company.
  You are correct that it is a predictable payout  and for some there is nothing wrong with that as part of a diversified portfolio, there are just more favorable for the investor ways to invest.
     
        Paul B

Yes.  "Depending on risk tolerance" and "part of a diversified portfolio", of course, go together.   Before I was sure of when I wanted to retire, I had about 70% exposure to the stock market.   Once I decided my target date, I reduced it to 30%, and went to lower return/lower risk investments.

I have no problem with the concept of an annuity, and the part about "the company gets their money up front".  That's just business, and can work to my advantage.

Suppose I invest $100,000 in a stock-based fund or individual stocks, targeting for retirement in 10 years.   If everything goes smooth and lovely, I'll get an average 6% or more compounded annual growth out of a conservatively invested stock portfolio, so that's good, and if things go smooth, I'll have $170,000 in ten years to put into an income-producing fund for me to spend, and can draw $6800 a year from that fund.   

BUT (and this is a big But with spikes and bells on it) suppose after 9 years of investment, one year before I want to retire, I have $159,000, shooting for $170,000 next year and OUT!   Then I wake up one morning, and before I can say "SELL!", I have $75,000 in my portfolio (shades of 2008!), and it hangs there for 5 years before it starts its climb back up to its 100-year 11% average gain.   You can't constantly protect against that with limit or stop orders; it happens.   Now, unless I'm happy with $3000 a year from that investment, I have to keep on working till the market improves.

So suppose I invest $100,000 in an annuity that guarantees that in 10 years, if I let it alone and let the insurance company have the gains, that they will pay me $5500 a year for the rest of my life, and the $100,000 principal goes to my heirs when I'm gone.    I'm HAPPY to let Jackson National have the difference between the $6800 I could have had if I'd managed it AND THE TIMING WAS RIGHT, and the $5500 that they guarantee regardless of what happens to the market .... Sure, it's just for my lifetime, but I'm NOT investing so that I can leave a pile to my kids, and they already know that.

Best to diversify with some stocks, some bonds, some annuities, and don't get greedy and try for the whole hog, or you'll be crying for a government bailout like so many did 10 years past .... !

Lannis

[fotoguzzi]

thankyou Lannis, that is very educational. If your not a professor you should be.. 

[Lannis]

thankyou Lannis, that is very educational. If your not a professor you should be..

Well, I paid a financial consultant dude to show me how to work all that.   If you already KNOW how it works from your business and experience, then you can do it yourself, just like if you work as a diesel repairman, you can fix your own VW at home.

But most of us weren't born knowing how to do it, and weren't in that business, and it's no easier to learn the ins and outs of financial management from a book than it is to learn plumbing, nuclear criticality safety calculations, or radar repair .... !

Lannis

[not-fishing]

I don't really trust the Experts.  Long ago I got me invested in some kind of fruit company.  It's the real reason I can retire before I'm dead, that and I've got nearly 50 years in Social Security.



I'd be a hell of a lot better off if I could move out of California but my Junky Wife only want's to go where there no fishing, no hunting or no snow.  I just figure it's another cross I have to bear.

[RinkRat II]

 Couple of points, Lannis, when this economy you speak of tanks, where do you think your annuity company will be? Are they immune from financial disaster,along with YOUR money? I see that as just as big of a risk.  Secondly, telling your money what to do can be learned very easily as long as you invest(pun intended) the time and willingness to learn. I'm not talking day trader or options, just simple basic money management know how. There are a lot of resources out there to learn from others mistakes and when they've done well. This info is golden and free. 

     Paul B

[ITSec]

I won't give you my own advice - it's worthless.

Instead, I'll pass along what Warren Buffet told his wife to do if he were to die and she wanted to get out of Berkshire Hathaway. He told her to invest in low to no fee index funds. They will go up and down with the market but they have the lowest of all costs and no management fees to speak of. Numerous studies have shown that no managed fund ever does as well as an index over the long run. Short to medium term, there are always stars, but year in and year out the index will outperform managed investments.

And if someone comes along with the next Apple, Google/Alphabet, or whatever, you will miss that early (and big) pop invalue - but eventually its success will end up with it becoming part of one of the index sets and you'll get the benefit. It may not be sexy, but it's effective.

[John Ulrich]

I held my nose and have added a few annuities over the years for diversification.  It's considered "lights on" money.  It will cover our monthly fixed costs...... utilities, taxes, insurance.  Actually the returns are on par with the market.  We get excellent advise which had done right by us....but we do pay for that.

[twodogs]

Wow, thanks folks for the reply's, never ceases to amaze me about the info you can receive on this forum, after about 40 years of driving and being around trucking in one form or another I guess I never really believed I would ever have a chance to retire, I put most of my monies into bikes and the rest I just wasted but what I wasted it on was paying my bills, so at 59 I am debt free and me and the wife are thinking about our dream job, retirement. Looks like I got a lot of reading up to do but it will be worth it. Ride safe all

Bruce

[elvisboy77]

Wow, thanks folks for the reply's, never ceases to amaze me about the info you can receive on this forum, after about 40 years of driving and being around trucking in one form or another I guess I never really believed I would ever have a chance to retire, I put most of my monies into bikes and the rest I just wasted but what I wasted it on was paying my bills, so at 59 I am debt free and me and the wife are thinking about our dream job, retirement. Looks like I got a lot of reading up to do but it will be worth it. Ride safe all

Bruce

What a great place to be in life!  Congrats!

[Lannis]

Couple of points, Lannis, when this economy you speak of tanks, where do you think your annuity company will be? Are they immune from financial disaster,along with YOUR money? I see that as just as big of a risk. 

I don't think it's just as big a risk.

The company that's paying my annuity has not failed to make an annuity payment, in full, since it was founded in the 1890s.   That includes the "panic of 1907", the Great Depression, and every recession or pull-back since, including the most recent in 2008.

So the risk of this company failing soon, versus the risk of the stock market value dropping in half over the next few years, is a risk balance I'm willing to take.

A younger man, who can "make up" for market reverses or "learning mistakes" in short-term trading with many or even a few years of future income, will make different investment risk decisions than a man who is looking at living (eating, being housed, etc) on a fixed income of his own design in a year or two!   

And I don't want to fail to thank our resident Texas turnip farmer for the retirement advice he gave me 15 years ago.   It was sort of a "philosophy of life" thing that made me realize that I could plan and execute my retirement without fear, just like he's done.    I've done it his way and it has worked (fingers crossed so far!).

Lannis

[twodogs]

Thanks Elvis, it is a monkey off my back for sure