Conference nyoss1::market_investing

    
    	Brian -
    
    	To sound a bit trite - Just Do It...
    
    	Get Peter Lynch's book "One Up On Wall Street". Pick companies you
    feel comfortable with (my wife, the shopper, has companies in her IRA
    like Gymboree, P&G, Quaker Oats, etc.; Me, the technologist, has
    Motorola, DEC Pref.A, S3, etc.).
    
    	Put at least 15% of your GROSS income away (that includes 401 (k),
    IRA account, etc.) for retirement. Do it every week. It's called dollar
    cost averaging. Forget market ups and downs (remember this is LONG term
    investing and nothing known to man beats stocks). Concentrate on the
    company. If individual companies bother you, do Mutual Funds like
    Fidelity Technology, or whatever.
    
    	Relax. Lean back. Put a smile on your face, 'cause by the time you
    are your parents age, you gonna be VERY well off.
    
    
    		the Greyhawk

    Go get yourself a book called  "Bogle on Mutual Funds."
    The author is John C. Bogle, the chairmain of the Vanguard Group.  It
    gives you a good description of all the different kinds of mutual
    funds.  It also gives you a good investment strategy.  

    Re .1's "just do it":  Amen that that!                  
    
    Investing is just like anything else: you get better by doing.
    
    Sounds like you're making the right moves by enrolling in SAVE
    and ESPP.  Rather than spend all your ESPP proceeds on house projects,
    you might want to stash a portion into a cash kitty (savings bonds,
    bank CD, or money market fund) until you've accumulated six months'
    living expenses (mortgage, utilities, food, medical insurance).
    
    To answer your questions:
    
    1.  My focus on the market is driven by two things:
         - historical price relationships
         - safety/volatility
    
        For example, when I saw stocks selling at low-single-digit
        P/Es back in the early '70s I knew it was time to buy.  So,
        not knowing a lot about investing, I picked up a few well known
        blue-chip stocks and held on.  All dividends were reinvested
        and account for most of the current market value.
    
        Today I think many commodities are *way* underpriced (check
        out the price of wheat now versus twenty-five years ago; almost
        the very same, and that's without adjusting for inflation!).
        Gold and silver are also cheap by historical standards.  If you 
        don't want to speculate on the commodities themselves (can be
        a white-knuckle experience), buy shares in the companies that
        produce these commodities and join those companies' dividend
        reinvestment plans (DRPs). 
    
    2.  No, I do not use a financial advisor.  I figure anything a
        financial advisor can learn, I can, too.  Over the years I've
        read a lot of books, subscribed to a couple of newsletters,
        and read the Wall Street Journal and Barron's regularly.
        It's too bad the public schools don't teach the rudiments of
        personal finance (budgeting, debt, investing, etc.), but the
        publishing business is doing a decent job of filling the gap.
        I like the books written by Douglas Casey, a no-nonsense value
        investor.  His latest, "Crisis Investing for the Rest of the '90s,"
        is chock-full of explanations and advice for the small investor.  
    
    3.  No, I don't worry about the money I've invested.  Sure, I keep
        an eye on my money, but if I can't sleep because of anxiety about
        some investment, I get out of it or skip it in the first place.
        Each person has his own "sleep well at night" threshhold, and
        you won't know what that threshhold is until you've made a few
        investments.  Also, your threshhold will change over the years,
        upward as you become more confident about your investing skill,
        downward as you approach retirement or other cash-needy times. 
    
    4.  How much do I invest?  Enough to meet our goals, and then some.
        
        My wife and I periodically go over our long term financial plan
        (developed without the help of a financial leech, er, planner)
        and see if we're on track.  This is also a good time to review
        our goals and, if warranted, revise them.  If the balances are at
        or above plan, we leave everything alone.  If below, we bump the
        savings rate a little.   Notice this approach introduces an upward
        bias on savings rate.
        
        Wherever possible we use automatic deductions (payroll or other)
        to shoot money into our savings and investing accounts.  That's
        a good way to ensure that you pay yourself first.
    
        And don't be tempted to raid your investing account for a Carribean
        cruise or some adult toy.  If it ain't in the financial plan,
        don't take the money out.  Of course, if one of your aims is to
        enjoy two weeks in Aruba sipping banana daiquiris in 1997, scope
        out the cost and save accordingly (DCU deduction is a good
        mechanism for such short term saving).
    
        By the way, in its June 5th issue Wall Street Journal had a
        front page article decrying the low savings rate of baby boomers.
    
    Ira Krakow in Stoneham, Mass. has a forum on personal finance matters
    that you can tap into.  Ask him to put you onto the subscriber list.
    E-mail address is CRL::"owner-persfin-digest@shore.net".
      

    
    Dittos on the "just do it" comment.
    
    My philosophy is simple:  "Invest 20+% of your gross income."
    Don't worry too much about what you invest in.  Just spread your
    risk around, and time will make you rich.  A little bit of
    self-education from the book store should be enough to keep
    you from doing something incredibly stupid.  
    
    Or you can do what most people do: buy a snazzy car, take a nice
    vacation every year, and complain about the paltry cost of living
    adjustment on your Social Security check when you're 65.
    
    I only wish I'd figured this out 10 years ago.  The bulk of my 
    investments are in real estate and aggressive growth mutual funds.
    Your mileage may vary, but the destination is the same.  
    
    
    Dave

    Why:
    
    The government made a limited-time offer to defer tax on the earnings,
    if I invested part of my income, and sweetened it with a sign-up bonus.
    (Tax-deductible IRA in 1985.)
       
    How:
    
    Started with TRowePrice; at the time, they offered lower IRA minima
    ($250) to IEEE members.
    
    Jon
    

re       <<< Note 893.0 by HNDYMN::MCCARTHY "A Quinn Martin Production" >>>
               -< Why (and how) did you get started investing? >-

i got started with the DEC ESPP back in '88 when i first joined DEC out
of college.  then, in '91 or so, my mother got me into tax free bond MFs.
these were excellent until int. rates turned upward.  consistently got
6-7% on my money each money, Fed and State tax-free, plus appreciation
on the overall fund share price.  i was 25 when i got started in earnest.

my girlfriend (now wife), i discovered, had a good stash of money
'rotting' away in a passbook savings acnt.  so, i talked her into
getting into the TF MFs also.  i showed her my past returns and she
decided to go with it.

then i expanded to stock MFs, bond funds, etc.  got my wife into the low-priced
Fido fund.  we've had that one for nearly 3 yrs now and it is doing ok,
although it hasn't enjoyed thge returns in the last 6 mos as many other funds.

then, an old HS friend of mine (exDeccie) got me into buying individual
stocks.  so, my wife (we were still not married) and i each put up $5k
for me to gamble, er, invest with.  opened a Fido USA acnt. started reading
the journal.  also, got more into diff. MFs.  in the past 4 yrs, i've been
in and out of 10+ MFs.  i know, i know, no long term horizon.  but, i hadda
come up with the down payment for our house, so we sold lots of MFs

my picture now is DCA'ing 225/mo in TR Price Sci&Tech (which is up nicely
this year) and 225/mo in TRP europe.  was DCA'ing in TRP japan, but bailed.
we also have bi=-monthly investments into money market funds.  and, i manage
our protfolio of about diff companies.

so, now we're both 30 (i'm still 29, just about 30).  we've been investing
for 5 yrs now and so far, we're happy with the returns.

> - Do you have finacial advisors?  

nope.  do it all myself.  read things in here.  read the WSJ.
read read read read.

> - Do you ever sit back and worry about money you have invested?  

nope.  long term on the stocks.  i have enough in 'safe' vehicles.
we have a t-bill, strong money mkt fund, DCU saving (keep this below
5k), etc.   the rest is in the market.

> - How do you figure how much of your income you should be investing?

start with our take-home income.
subtract out the bills: mortgage, water bill, tax bill,etc,etc.  added
a few 100 for fun/unexpected.
all bill $$$ goes into checking.  the rest is invested.  including
401k, we are saving/investing a _whopping_ 42.5% of our Gross.  
considering the american average to be less than 5%, we're doing
quite nicely.  mind you, we don't live an extravagant life:

	- i fix my own cars
	- we do our own housework/landscaping/lawn mowing
	- we are not big into eating out at expensive places
	- i've never paid more than $5500.00 for a car.  always pay cash.
		drive 'em til they cannot be driven anymore.  my last	
		car, an '81 z28, i drive to 150k. had it for 6yrs. pd $5k,
		sold it for 1.8k.  my current car i've had for 3 yrs.
		could have sold it this spring for 4.6k but flinched and
		decided to keep it. pd 5.5k for it.
	- i'm a s/w engineer at DEC and do not need fancy clothes.
	- we have no children.

i don't expect our savings rate to continue at this pace for ever, especially
if we have kids.  it'll go to 20% :-(  but, i might as well be aggressive
now while i can get away with it.


each week, i compute the worth of our investments.  each week has a goal
$ amount nee4ded to reach the year-end goal.  currently we're 9.7% ahead
of that goal.  any extra at the end of the year we will be free to blow
it on something somewhat frivolous as a reward for good saving and
investing.  

goal-oriented investing works best for me.

that';s it

    
    	I'm usually a read-only noter but like this topic.
    
    	My Father is self employed and owns his own company. A
    friend of his was selling life insurance and Oppenheimer Mutual
    Funds. It was 10 years ago and I had just turned 18. So Dad
    wanted my brother and I to listen to what the man had to say.
    Dad wanted to save for retirement.
    	When the guy told me that if I put $50 a month. In a mutual
    fund from the age of 18 until I turn 65. With just reinvesting
    the dividends and capital gains. At an average return of investment
    of 9%.  That I would have well over a million dollars, come the
    age of 65. I started the fund and haven't stopped. It used to be
    called Oppenheimer special fund A, it is now call Growth fund A.
    	This fund has done outstanding the last 10 years IMO. I
    constantly check the paper looking at it. It is currently
    Oppenheimer's highest return of investment fund. With a 3 year
    return of ~50%, with the last 12 months being ~27%. You can't
    get 27% in the bank.
    	I've also been doing the Digital ESP program at a small 2%.
    I wanted to buy a condo. So I made up my mind when the stock was at
    18. That I needed $41 dollars a share to break even. That when the
    stock hit $41 I was selling. The stock hit $41, I broke even and
    bought my condo. Still in the ESP program, building up those shares
    again.
    
    Ron

    Both my wife and I grew up in homes where investing was done.  I had my 
    first "investing" class in the 6th grade - mostly statistics (gambling 
    with beans) but we tracked stocks on the back board.  My Playboy made
    modest gains but Brain Harris's Quaker State Oil won.  Seems he had a 
    tip from his father that when QSO sold off it's supplies of home heating 
    oil, the price went up every spring...  I hope I didn't just give away a
    family secret!  I plan on teaching my kids aobut money and investing when 
    it's time.  
    
    Focus area - none.  I'm leaning more to Mutual funds.  But they're not as 
    	much fun as having "your pick" do well.
    
    Advisor - both my father and father-in-law have the time to read
    	the WSJ cover to cover and they mention or cut out articals of
    	interrest to us.
    
    Worry or let it ride - my folks did long term investing.  Choose
    	wisely, use divident re-investments and don't get loaded up on
    	any one stock.
    
    % to invest - What you can afford.  With a non-working wife, 2 kids, 
    	a house and a dog... My percent is less now than it was earlier or 
    	will be later in life.  But we're moving in the right direction.  
    	We do between 8-10%.
    
    Besides mutuals, many companies have their fingers in several "pies".
    I like it best if they are similar.  Some companies do fine with
    several, totally unrelated industries governed by the same BOD.  Like
    a mutual, if one of their divisions isn't doing well, maybe the others
    are.
    
    Dividend re-investment is GREAT except when it's time to pay taxes on
    money you've never "seen".  Also, one company we have will "tap" your
    checking account monthly for an amount you set up.  Or you can send a 
    monthly check.  No discount but little or no fee. 
    
    We recently had two neighbors die, age 43 and 49.  Remember, there's no
    prize for being the richest man/woman in the cemetary.  You've got to
    live a little now, too.  Maybe some of your investments will go towards
    a nice car or a boat or a grand vacation some day.  I don't think
    that's such a terrible thing.

    When did I get started? Gosh, my dad opened bank accounts for all of us
    when I was 4 or 5, and encouraged us to put a little of our birthday or
    allowance money away "for college". It worked: through careful
    management, I exhausted the few thousand in my savings account by my
    last month of senior year. We also collected coins, not just because it
    was fun, but because we knew they would appreciate in value. We were
    investing within the limits of our expertise.
    
    Dad also taught us about risk, mostly through penny ante poker. Lastly,
    I remember that he paid off our house early, largely through the sale
    of stock in the company where he worked. So I was fascinated with
    investing at this more rarified level, though mindful of his warning
    that the stock market is "just like gambling."
    
    First stock investment was in National Semi, when I was 19. I made $250
    when I sold it two months later, so I counted myself ahead and didn't
    dabble again until my 20's. (Meanwhile, a college friend lost a $10K
    inheritance within a few months on stock options; this taught me
    caution.)
    
    Since then, I've gotten into mutual funds and individual stocks, but
    only after I had several thousand salted away in the bank. In the case
    of stocks, I invest only what I can stand to lose.
    
    I dabbled in options and broke even, but don't recommend it: the upside
    *looks* very nice, but there are two ways to lose and only one to win.
    If you lose, you lose the whole investment; if you win, you need to win
    big to compensate for the bid/asked spread and commissions. Same is
    probably true for currency and futures speculation.
    
    Don't let the term "investing" scare you into NOT investing. The bank
    is safe, gives a better return than burying your money in the yard, and
    allows you to build up a stake while you research how to improve your
    return. But do put SOMETHING away, every month.
    			Good luck,
    				Jim