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Old 12-14-2012, 07:19 AM   #21
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Nera, an advantage of talking to people on this board is that many have already succeeded at retirement.

Financial advisors are still at work! And many are nothing more than salesmen for their companies products.

No one on this board is selling anything. Just free advice from people who would like to see others succeed.

In theory, theory and practice are the same. In practice, they are not.
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Old 12-14-2012, 08:28 AM   #22
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Originally Posted by Nera View Post
Thank you, thank you, thank you all for your advice. I have a lot of reading and research to do and you all have given me a good point of departure. I've decided to to contribute 3% and work hard to get a measure of understanding quickly so I can invest in something better, like a Roth at Fidelity or Vanguard.

(And Bestwifeever, I agree with your heresy and so if I don't stick to a self-directed plan, I'll put more into American in 2014 because I know I can't save for retirement with a savings account.)

I'm really heartened to see that so many people have been able to figure out retirement and investment for themselves. It took me years to truly buckle down on cashflow and I've only recently gotten aggressive enough in my salary negotiations that we do have a HHI of $130k. So thanks for your patience and I'll be studying these forums, along with a bunch of suggested reading material closely.
Sounds like a good plan and hopefully at the end of 2013 you will find you have saved even more that 15 % all together and you'll be financially literate to boot. I wish we had had the expertise of the folks on this board when we were your age!

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Old 12-14-2012, 08:41 AM   #23
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Originally Posted by dmdunca44 View Post

Right now, I'd contribute enough to get the match. After that, I would not put any other money into American Funds. If you want to open a Roth or Trad IRA on your own, you have until April 15, 2013 to contribute for 2012. I'd definitely go with Vanguard or Fidelity. If you don't want to have to learn a lot right away, put the funds into a Target Retirement fund. Then contribute the max allowable every year.

Nera, I'll second this advice. No real need to rush, since you can open an IRA any time in the next 4 months. Just double check that your income won't prohibit you from participating in an IRA. In 2013 you and your spouse can put a total of $11000 a year into IRAs, so that will go a long way toward your retirement savings (when it grows over 30 years).

I'll recommend one book: The Bogleheads' Guide to Investing: Taylor Larimore, Mel Lindauer, Michael LeBoeuf, John C. Bogle: 9780470067369: Books

The Bogleheads Guide to Investing

The book covers investing, taxes, and money management and starts at a fairly basic level that is great for beginners that don't know all about investing terms and the lingo that is used in the financial advising world.

The bottom line is that investing doesn't have to be highly complicated, and even a beginner can do it on their own with a little up front learning.
Retired in 2013 at age 33. Keeping busy reading, blogging, relaxing, gaming, and enjoying the outdoors with my wife and 3 kids (4, 10, and 11).
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Old 12-14-2012, 10:19 AM   #24
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American Funds are generally well run, but some have excruciatingly high expense rations and when sold through advisors (even 401k advisors) can carry obscene loads. The fact that you are being pressured to make a quick decision indicates this plan was not well thought out and increases the chances you will be hit for fees that can make this a terrible investment, even if American runs a good fund.

You absolutely need to know expense ratios on the Funds and if there are any loads or fees involved. 401k can charge terrible fees, especially in small plans. Sometimes so terrible you would do better even without the match or tax deduction. You need to know more to make this choice.
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Old 12-14-2012, 02:54 PM   #25
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Nera, Fuego recommended a good book. The Bogleheads also have a great website. Here's a link to their "getting started" page: Getting Started - Bogleheads

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