SteveR
Moderator Emeritus
- Joined
- Jul 1, 2005
- Messages
- 2,811
Welcome SSQQ,
You are receiving a lot of good advice. Here is a bit more to add to the pile.
My first wife took half of what was in my 401(k), 90% of the house equity (long story), and I got $>100,000 in debt to pay off while being a single parent and paying alimony. Not exactly a good combination to even think about retirement much less an early one.
A few years later I remarried and my wife and I were employed by the same company. We both had company stock in our 401(k) plans; she had 100% stock which she had accumulated for well over 25 years. When I started looking at her financial picture I nearly had a heart attack. I finally convinced her to start moving some of it to more diversified funds. Over a couple of years we managed to move about 40% of it....then the company ran into trouble and lost 70% of the stock price in a few days (still has not made it back up in over 10 years). We "lost" a lot of value in those few days.
I have strong opinions on having too much invested in one company. You have your pension, your job, your insurance and a large portion of your 401(k) attached to the same company. I believe that is too many eggs in one basket. I have some former company friends that were in the wrong division of the company and it was suddenly sold off. Their benefits were reduced and others frozen at the pre-sale level. Many lost pensions and stock options. Others lost their jobs. It was ugly and can happen to anyone.
Back to my story...
Flash forward 10 years from my marriage to wife #2. We both saved a ton, invested a ton and managed to retire early. We moved and found a new job (another long story). Seven months into retirement she suddenly passed away. Since then I have remarried and retired last year. My current wife became disabled soon after we were married. (another long story).
So what is the point of all this? Simply that you never know what will happen tomorrow. Don't trust your company to take care of you or to provide for you. You have to provide for yourself. Too many eggs in the company basket can lead to disaster.
If you don't want to do your own financial planning then by all means seek out a Financial Planner who works by the hour and not on commission so he will look out for you and not himself. You can do a great deal of self planning without a huge amount of knowledge by just reading the books mentioned here and by using a low cost brokerage house (Vanguard, etc.) and rolling over you 401(k) when you retire, to a self-directed IRA with several different low cost index funds. Balance and diversification are key and not that hard to do with Vanguard.
Take your time and do your homework. Don't do anything without some kind of plan. The market is down right now and many see that as a good time to buy. If your company plan has some index funds you might want to research them and see what works best for you and move some of that company stock into them while prices are down. Remember, you are still young and your investments need to work to make an income stream for you in the future (10+) years down the road.
Good luck and welcome to the board.
You are receiving a lot of good advice. Here is a bit more to add to the pile.
My first wife took half of what was in my 401(k), 90% of the house equity (long story), and I got $>100,000 in debt to pay off while being a single parent and paying alimony. Not exactly a good combination to even think about retirement much less an early one.
A few years later I remarried and my wife and I were employed by the same company. We both had company stock in our 401(k) plans; she had 100% stock which she had accumulated for well over 25 years. When I started looking at her financial picture I nearly had a heart attack. I finally convinced her to start moving some of it to more diversified funds. Over a couple of years we managed to move about 40% of it....then the company ran into trouble and lost 70% of the stock price in a few days (still has not made it back up in over 10 years). We "lost" a lot of value in those few days.
I have strong opinions on having too much invested in one company. You have your pension, your job, your insurance and a large portion of your 401(k) attached to the same company. I believe that is too many eggs in one basket. I have some former company friends that were in the wrong division of the company and it was suddenly sold off. Their benefits were reduced and others frozen at the pre-sale level. Many lost pensions and stock options. Others lost their jobs. It was ugly and can happen to anyone.
Back to my story...
Flash forward 10 years from my marriage to wife #2. We both saved a ton, invested a ton and managed to retire early. We moved and found a new job (another long story). Seven months into retirement she suddenly passed away. Since then I have remarried and retired last year. My current wife became disabled soon after we were married. (another long story).
So what is the point of all this? Simply that you never know what will happen tomorrow. Don't trust your company to take care of you or to provide for you. You have to provide for yourself. Too many eggs in the company basket can lead to disaster.
If you don't want to do your own financial planning then by all means seek out a Financial Planner who works by the hour and not on commission so he will look out for you and not himself. You can do a great deal of self planning without a huge amount of knowledge by just reading the books mentioned here and by using a low cost brokerage house (Vanguard, etc.) and rolling over you 401(k) when you retire, to a self-directed IRA with several different low cost index funds. Balance and diversification are key and not that hard to do with Vanguard.
Take your time and do your homework. Don't do anything without some kind of plan. The market is down right now and many see that as a good time to buy. If your company plan has some index funds you might want to research them and see what works best for you and move some of that company stock into them while prices are down. Remember, you are still young and your investments need to work to make an income stream for you in the future (10+) years down the road.
Good luck and welcome to the board.
