I am selling property and will recieve 400K tax free. I have a 401K all of which is one company stock =250K. I need someone or somewhere to go to for proven advice to invest for five years then retire.....Presently 45. I would like to mimic a plan but realize there are no crystal balls.
Five years to eligibility@50
- Thread starter mp77
- Start date
Do not panic. Cash can be an excellent choice for a few years if you need time.
In addition, it is generally a good idea to invest your funds gradually (similar to dollar cost averaging). That approach fails only when there is a strong, continuing upward trend in a market. The stock market is still at historically high levels of valuation even though it is much closer to the previous norms than it used to be. You can afford to wait.
Have fun. Pay attention to what you will be doing after you retire. I am talking about your future daily routine, not something such as a dream vacation.
John R.
In addition, it is generally a good idea to invest your funds gradually (similar to dollar cost averaging). That approach fails only when there is a strong, continuing upward trend in a market. The stock market is still at historically high levels of valuation even though it is much closer to the previous norms than it used to be. You can afford to wait.
Have fun. Pay attention to what you will be doing after you retire. I am talking about your future daily routine, not something such as a dream vacation.
John R.
Here are some suggestions:
1. Until you decide what is an appropriate allocation for you between cash, stocks, bonds, and other assets, put your money into something that is safe and liquid, but which pays more interest than a money market fund or bank CD's. I suggest Vanguard's Short Term Corporate Bond Fund and/or Vanguard's Inflation Protected Securities Fund. Both have no loads and low annual expenses.
2. If you don't already have a Roth IRA, establish one before April 15 (with Vanguard or another investment company that offers no load, low cost mutual funds). That way, you can contribute $2,500 to it for year 2002 and another $3,000 for 2003. You will be able to contribute that much (or more in the future) for every year in which you have that much earned income. All earnings in this account will grow tax-free and may be withdrawn tax-free after you reach age 59 1/2.
3. You can decide for yourself what constitutes a good "basic" asset allocation between stocks and bonds by experimenting with the FIRECalc program. Also, mutual fund companies like Vanguard, T. Rowe Price, and Fidelity regularly publish data that provides guidance regarding asset allocation.
4. For continuing advice, see the "Getting Going" column by Jonathan Clements in the Wall Street Journal on Wednesday and in the Sunday business section of many newspapers. The financially sound principles that he explains how to implement are (1) diversification and (2) keeping investment expenses and taxes low. It is a rare case in which advice that is essentially "free" is much better than the advice provided by most "financial professionals" (whose primary interest is in selling "financial products" that provide big commissions to them at your expense).
5. For heaven's sake, reduce your exposure to your own company's stock! What happened to the Enron employees who loaded up on Enron stock might happen to anyone.
1. Until you decide what is an appropriate allocation for you between cash, stocks, bonds, and other assets, put your money into something that is safe and liquid, but which pays more interest than a money market fund or bank CD's. I suggest Vanguard's Short Term Corporate Bond Fund and/or Vanguard's Inflation Protected Securities Fund. Both have no loads and low annual expenses.
2. If you don't already have a Roth IRA, establish one before April 15 (with Vanguard or another investment company that offers no load, low cost mutual funds). That way, you can contribute $2,500 to it for year 2002 and another $3,000 for 2003. You will be able to contribute that much (or more in the future) for every year in which you have that much earned income. All earnings in this account will grow tax-free and may be withdrawn tax-free after you reach age 59 1/2.
3. You can decide for yourself what constitutes a good "basic" asset allocation between stocks and bonds by experimenting with the FIRECalc program. Also, mutual fund companies like Vanguard, T. Rowe Price, and Fidelity regularly publish data that provides guidance regarding asset allocation.
4. For continuing advice, see the "Getting Going" column by Jonathan Clements in the Wall Street Journal on Wednesday and in the Sunday business section of many newspapers. The financially sound principles that he explains how to implement are (1) diversification and (2) keeping investment expenses and taxes low. It is a rare case in which advice that is essentially "free" is much better than the advice provided by most "financial professionals" (whose primary interest is in selling "financial products" that provide big commissions to them at your expense).
5. For heaven's sake, reduce your exposure to your own company's stock! What happened to the Enron employees who loaded up on Enron stock might happen to anyone.
dory36
Early-Retirement.org Founder, Developer of FIRECal
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Great discussion, and others might benefit from the responses. So I'm moving it from the "how do I use this forum" section to the "investment strategies" section.
Dory36
Dory36
Please visit www.ibaloinaturepark.org. We have a very good investment opportunity there for retirees. The project is located in the Philippines. ROI is fast and very attractive considering the might of dollar in the Philippines. We will assit you for any documentary requirement in the Philippines
BigMoneyJim
Thinks s/he gets paid by the post
Uh-oh, Dory36 may have to move this thread yet again....to the "Make money fast with no work and no brains" forum.
I note from the web site that this development has all sorts of amenities that are "proposed." I would be reluctant to invest in any such development, even in the U.S., unless there was proof of sufficient financial commitment to complete the essential "amenities."
As a general principle, I don't think much of Americans retiring to countries that have a substantially lower standard of living than in the U.S. Americans generally do so because their "dollars go farther," which means that they can live in relative luxury compared to the local people. In doing so, they are typically isolated from local society (which can become lonely for them), and can easily become "ugly Americans" resented by the local people.
Retirees who are willing to conform to local lifestyles and customs, in the manner of Peace Corps volunteers, may have something to contribute. But those who just want cheap servants would better serve their own interests and those of local people by staying in the U.S. and purchasing products made in developing countries.
As a general principle, I don't think much of Americans retiring to countries that have a substantially lower standard of living than in the U.S. Americans generally do so because their "dollars go farther," which means that they can live in relative luxury compared to the local people. In doing so, they are typically isolated from local society (which can become lonely for them), and can easily become "ugly Americans" resented by the local people.
Retirees who are willing to conform to local lifestyles and customs, in the manner of Peace Corps volunteers, may have something to contribute. But those who just want cheap servants would better serve their own interests and those of local people by staying in the U.S. and purchasing products made in developing countries.
Mr._johngalt
Thinks s/he gets paid by the post
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There is a positive angle which offsets the
"isolation" of Americans moving to low cost of living
countries. Many of these countries already have large
American "enclaves". If you relocate there. you will
have plenty of company with the same heritage,
language, customs, etc. Nothing wrong with mingling
with the locals, but for those who would rather not
it's a really good option for ERs. In fact, if my circumstances were a bit different I would seriously
consider it. Probably Mexico or Central America.
I suspect that a lot of the "ugly American" feelings
would be quickly forgotten with a little sensitivity
along with the monetary impact of those ER dollars.
"isolation" of Americans moving to low cost of living
countries. Many of these countries already have large
American "enclaves". If you relocate there. you will
have plenty of company with the same heritage,
language, customs, etc. Nothing wrong with mingling
with the locals, but for those who would rather not
it's a really good option for ERs. In fact, if my circumstances were a bit different I would seriously
consider it. Probably Mexico or Central America.
I suspect that a lot of the "ugly American" feelings
would be quickly forgotten with a little sensitivity
along with the monetary impact of those ER dollars.
Anybody who imagines that "enclaves" of Americans would not be resented in less developed countries should imagine how they and their neighbors would feel if a group of wealthy foreigners (such as, say, Japanese, French, or Russians) purchased a large tract of the most desirable land in their community, and built an exclusive gated enclave there. A few local merchants might be happy with their purchases, but I guarantee that most of the people in the area would highly resent them. (I don't doubt that many Florida natives probably feel the same way about northerners.)
People in poor countries can reasonably be expected to feel the same way towards Americans. And I for one don't support the using U.S. military forces to rescue them if the resentment turns to violence.
People in poor countries can reasonably be expected to feel the same way towards Americans. And I for one don't support the using U.S. military forces to rescue them if the resentment turns to violence.
Mr._johngalt
Thinks s/he gets paid by the post
- Joined
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- 4,801
Whoa! By "enclaves" I wasn't talking about a fortress- like situation. However, it does seem that most Americans who relocate to other countries prefer to
settle in with their fellow countrymen. I know I would,
On the other hand your point about wealthy
foreigners creating an "enclave" in my back yard is
well taken. In fact, I have seen this sort of resentment
of tourists by the locals right here in the States.
For example, I recall during my years in Northern Michigan, the summer visitors were commonly referred
to as "fudgies". But, you find this sort of parochialism
almost everywhere, to one degree or another.
settle in with their fellow countrymen. I know I would,
On the other hand your point about wealthy
foreigners creating an "enclave" in my back yard is
well taken. In fact, I have seen this sort of resentment
of tourists by the locals right here in the States.
For example, I recall during my years in Northern Michigan, the summer visitors were commonly referred
to as "fudgies". But, you find this sort of parochialism
almost everywhere, to one degree or another.
Hi Ted,
Yes, you're right. The project is still in its "proposed" stage. You are right also about the financial requirement for the project to push through. I truly understand where you are coming from.
Let me explain that the retiree's village is just another component of the project. At this point several groups have indicated their intention to help out in the nature park component. I will you keep you posted of the developments.
On the matter of the possibility of locals resenting foreign nationals particularly Americans, building an enclace in their community, did you know that majority of Filipinos still have what we call colonial mentality, that whatever is American must be superior? Ironic isn't it. I'm a Filipina but I must say, that Filipinos still view the whites as more superior race! Further, this part of the Philippines (Baguio City) was practically built by Americans.
So maybe Americans retiring in other countries just have to study the history and culture of the country and the specific area they plan to go to, for them to be guided.
Yes, you're right. The project is still in its "proposed" stage. You are right also about the financial requirement for the project to push through. I truly understand where you are coming from.
Let me explain that the retiree's village is just another component of the project. At this point several groups have indicated their intention to help out in the nature park component. I will you keep you posted of the developments.
On the matter of the possibility of locals resenting foreign nationals particularly Americans, building an enclace in their community, did you know that majority of Filipinos still have what we call colonial mentality, that whatever is American must be superior? Ironic isn't it. I'm a Filipina but I must say, that Filipinos still view the whites as more superior race! Further, this part of the Philippines (Baguio City) was practically built by Americans.
So maybe Americans retiring in other countries just have to study the history and culture of the country and the specific area they plan to go to, for them to be guided.
