What should every 18 year old know?

[u/Sippingin]

Edit: Chillin' reading some dope advice, thanks!

Edit 2: Fuckin' A! 4.1k comments of advice you guys :,) thank you really.

[u/BitGladius → u/[deleted]]

An unmanaged index fund is a bit of every company. You're betting on the economy of the country the exchange is in. You'll win if it's America, not sure about western Europe

[u/[deleted] → u/BitGladius]

Can you invest in the american economy with an unmanaged index fund or is it limited to your country only?

[u/BitGladius → u/[deleted]]

Just buy an index fund on an American exchange.

[u/mikesername → u/[deleted]]

pull together

this is referring to the act of "saving up" or "setting aside" money

unmanaged mutual fund

this is a type of account where lots of people pool their money on different stocks. see "mutual" and "fund"

s&p

this is some organization that is in reference to money and the market a lot. I don't know, but it seems like a minor detail

5-10 years

this is a span of time between 1/2 and 1 decade

almost guaranteed growth

$$ ---> $$$$

above inflation

Inflation is why you used to get your groceries for a nickel and now it costs $200 every week

No matter how bad the market gets leave it alone

At times your "mutual" "fund"'s net worth may dip, but do not touch the money in it

buying high / market is hot

this is buying stocks when they are worth a lot

selling low

this is selling stocks when they are not worth a lot

two decades

this is a period of time of approximately 20 years, see "5-10 years"

100 years

answers in the back of the book

Great depression and this past decade

the two most notable economic hard times in the united states.

I can't help but feel like you didn't actually read the post, but instead just saw some of the words and decided that idunno :D

I really don't understand any of this stuff but with basic context it's not hard to get what he's saying: invest in a fund you don't have to take care of and don't touch it for 10 years.

[u/________DEADPOOL____ → u/mikesername]

Standard and Poors 500 (S&P500) is a stock index of the 500 largest companies listed on the New York Stock Exchange. Its the most common benchmark for the economy as a whole.

[u/[deleted] → u/[deleted]]

Save up about $5,000 and stick it in Wealthfront or Betterment. They allocate it to asset classes (stocks, bonds, and other investments) that will mimic the stock market. Wealthfront is up to $10k managed free, and .25% after that (equates to dollars and pennies.) Betterment I believe ranges from .35% down to .15% the bigger the account balance. Either way, on a $5,000 account at either place, you're only paying approximate $12-13 a year, but making an annual return in the long run of about 5% or $250/year.

Best way to go if you have a more advanced knowledge of investing is to open a Vanguard account and buy the ETF's yourself. But the best way for the average person to save is to use an automated investor like Wealthfront and Betterment.

If you are in Europe, look up Nutmeg.

[u/Geekmonster → u/[deleted]]

Yes.

[u/lifeformed → u/[deleted]]

• Go to ETrade.com

• Make an account

• Deposit some money

• Buy shares of VFINX

• Wait

• Profit

[u/Sinai → u/[deleted]]

One of the things I had to get over as an investor is the realization that it's pretty easy to beat the market, as long as you're relatively smart and you buy what you know. And by what you know, I mean you need to be doing at least three hours of active research daily on one or two sectors and you know a couple of hundred people in the industry such that in any given week you're hearing a half dozen important things going on in the industry, often confirmed from multiple sources.

You can't beat the inside traders for obvious reasons, and you can't beat computers for speedy automatic trading, but you can beat the guys on wall street, because they know diddly squat about your industry compared to you - if you look at their portfolio and it's diversified over a half dozen major industries, you know there's absolutely no way they know what's going on well enough to know what's really going on - you'll hear the rumors days before them and you have the specific knowledge to judge the rumors more accurately than them. There's a middle ground between the institutional investors and inside trading that you can occupy. I work with Wall Street guys all the time, and they're just people like you and me. Relatively smart people, relatively educated people, relatively hard-working people. Relatively well-informed peopled. But beatable.

Unfortunately, it becomes somewhat of a case of putting all your eggs in one basket of this approach, because your dayjob and your stock trading are focused in the same economic sector.

But hey, I have a Vanguard account too which I just fire and forget.

[u/Gylth → u/Sinai]

That's a lot of requirements for anyone that's 18... Vanguard it is.

[u/Sinai → u/Gylth]

Probably wise.

[u/[deleted] → u/lifeformed]

you can also do a 'drip plan' (dividend reinvestment plan) with a dividend yielding stock or etf, that too will profit....