New to investing

[aarondogg33]

I got a new job and they start a 401k automatically for me. I am looking for the best way to make quick money, and also invest long term with a higher potential. The company I am going through is t-rowe price.

[disneysteve]

I got a new job and they start a 401k automatically for me. I am looking for the best way to make quick money, and also invest long term with a higher potential. The company I am going through is t-rowe price.

Why would you be looking to make "quick money" with your 401k? That is a retirement account. You want slow steady growth over decades (not sure how old you are). Assuming you are relatively young, you have time to take some risk and ride out the ups and downs of the market over time. Depending on what other investments you already have, fit this account into your overall asset allocation. Again, if you are relatively young (20s or 30s), you probably want 80% or more in stocks.

[snafu]

Great 1st step being enrolled in 401K. Is there an employer match and when does it start? I don't know your risk tolerance but understand that stock values are constantly changing and just now, interest on Bonds is not keeping up with inflation. If you'd like to learn more about investing there are some terrific, easy read books available at your library.

Many of us started with a low cost, no fee Index Mutual Fund. Whatever you choose, check the Management Expense Ratio [MER]. Vanguard is often favored here. By contributing the same amount every month your unit numbers increase via Dollar Cost Averaging [DCA]. When you have significant value you can subdivide into categories like International, or Small Capitalization or whatever you see as value. Understand that unit values go down as well as going up following the market they represent.

[kv968]

I got a new job and they start a 401k automatically for me. I am looking for the best way to make quick money, and also invest long term with a higher potential. The company I am going through is t-rowe price.

They most likely put you in one of T Rowe's Target Date Funds, which in my opinion, are very good. If you're not sure how or what to invest in it wouldn't be bad to just stay in that fund until you learn more. Or just stay in that fund even when you do.

There's really no way to make "quick" money in most 401k's nor really should there be since it's designated as a long-term investment. The best thing you could do is figure out an allocation you're comfortable with and go with that. The target date funds are automatically diversified so again, you might just want to stick with that.

The most important thing, and the "quickest" and surest way to make money, is to contribute up to the max that your employer is matching if in fact they are. THAT is quick money.

[jpg7n16]

I am looking for the best way to make quick money

Sign up for additional overtime at work. That's the best way to make quick money.

and also invest long term with a higher potential.

Remember the story of the rabbit and the hare?

Moral of the story: slow and steady wins the race


I believe you probably have some poor expectations for how investments work. What are your expectations from your 401k investments?

[wesman1299]

Your first mistake is wanting to make money quick off of a 401(k). Putting any sort of money on the stock market requires you to have patience. I am not sure of your age, but you will definitely want to diversify your investments as much as possible. The younger you are, the more risk you should be willing to take.

Do not get discouraged by a dip in the stock market or a temporary loss on your investment. When prices go down, you'll be able to buy new shares for cheaper, which means that when the market bounces back (it will), you will have more shares to capitalize on the gain. Stocks are essentially going on sale at this point.

[scubatim84]

I won't tell you how to make quick money, but I will tell you how to make good money and I can sum it up into three words: Buy and hold.

Everyone else has offered good advice on the specifics....go for low-cost index funds which hold the entire stock market, if you're young probably around 25% bonds with the rest in stocks and I wouldn't recommend more than 25% exposure to international stocks.

Another good tid bit is to not pay attention to stock market fluctuations or news from one day to the next. Whenever I see the stock tank or rally, I have to ask my wife what happened because I could care less...doesn't affect my strategy of "buy and hold".

[YLTL_Dan]

One of the most depressing parts of early investing is knowing how tiny your accounts are! I wanted the quick money when I started investing as well because it didn't seem like I'd ever be able to save up large amounts. That's why I gave day-trading a try (you can read what happened here).. but it didn't work out well.

The best formula has been consistent contributions plus time. Only now do I feel I'm beginning to build up a good amount. Keep in mind I've been doing it for 8 years, and I just now feel like I have something to "write home about"... but I have a long way to go!

[bjl584]

If you want to make big money then you need to think outside the box. Your 401K is a longterm investment that should be treated as such.

For the rest of your money, be creative. Learn about real estate investing, start your own business, invest and patent something, learn how to trade stocks, become the CEO of some company.

Thats all obviously easier said than done, but the point is making big fast money is a whole different concept than investing in a 401K.

[alirobertson]

consult an advisor perhaps?

Identify your strengths and weakness. Sit down with an asset manager or a financial advisor and get expert advice. Later on, you can use your 401k in venturing into a solid business.

[scubatim84]

Identify your strengths and weakness. Sit down with an asset manager or a financial advisor and get expert advice. Later on, you can use your 401k in venturing into a solid business.

The caveat I would add to this is be careful when picking a financial advisor...I would recommend getting one who charges a fee instead of commission. Get referrals if you can and get references from the advisor. Also, run away screaming if they start pushing funds that have 3-5% cost with the claim that "oh, they beat the market so well it makes up for the cost".

[Kooshiball]

There is absolutely no such thing as creating quick money in investing. It will take either time (Like 401K or other traditional investment) or work (Knowledge, effort) or both. However, if you take time to educate yourself financially (Going through the seminar, meeting and doing actual deal with investors), it is huge possibility that you can create significant wealth.

[chrisburke21]

The other posters have given some great advice. Retirement plans like your 401k should be slow and steady. They do pick up momentum through the power of compound interest. The way to put time on your side is to sick away as much as early as possible. I reccomend reading A Random Walk Fown Wallstreet. This book has some good basic investing guidance.

[prof.susan]

Lucrative investing

If you have a short time horizon I would recommend looking into option investing. I read an excellent book called "The Power Curve" by Scott Kyle and it breaks down exactly how to get the most out of lucrative investing methods with a short or long time horizon.

[BigTimeTrader]

book question

^ I have read that book as well. The graphs are really helpful that's for sure. I recommend "The intelligent investor" also. Both are great books.