| |
| |
|
|
Day Trade Blog - Ivesting Information Learn to invest in the stock market, invest like a pro daytrader swing trading penny stocks |
|
|
|
401(k) Plans
I've been in and interested in the stock market so long (one year shy of forty years) I can remember when the mutual fund pages in my home town paper were just one page! Now it looks like there are more mutual funds then there are stocks listed on the New York stock exchange. I wonder how many billions of investor dollars are supporting these funds. How many investor dollars are supporting all the brokerage firms? How many times has 401(k) monies been given to a 'financial expert' to manage after retirement, then three years later the $400,000 is down to $200.000 (Yet, the financial expert is still driving around in a new Lexus). I could tell you stories from the people I know, who have retired and aren't so happy with these experts, but I bet you know some stories of your own. Do you know what you're going to do with your 401(k) money when you retire? If you are going to hand it over to a financial expert to manage, see if you can get the names of some of his/her clients. See if you can call some of the expert's clients, tell them what you're planning to do and ask them if they're satisfied with the expert's performance. Or you could talk to those people you've once worked with, have retired, and went with a financial advisor or planner. Try to get some reference from a live body that has already been there, rather than just a bunch of statistics thrown at you by the expert. Today's 401(k) plans are excellent vehicles for saving money and here's what I like about mine: I like the 10 percent contribution being a tax write-off (some plans, sixteen percent). I can contribute up to 16 percent, but 6 percent would have to be after-taxed dollars. I like that the monies made in a 401(k) are tax-deferred. I like the company's 70 to 100 percent company match (it differs every year with my company) up to 6 percent of my contribution. I like the option to move my money (every business day, if I wished) into my company's stock or an Interest Income fund, Bond fund, Mutual fund or Index fund, at no cost. I like the option to roll-over into an individual IRA account, twice a year, any after-tax and company matched dollars put into my 401(k), with no penalties or fees, even while I am still employed with the company. This allows me to select individual stocks and allows the dividends from those stocks to be rolled-over automatically into more shares of each company, also at no cost. (However, there are commission fees for the purchases of the stock. Dividend purchases only are commission-free. In my book 'The Stockopoly Plan' I explain how to purchase stocks commission free.) I like that the company's dividends in my IRA (set up by monies from my 401(k) plan) are also tax-deferred and are 85% tax free. I like knowing that when my retirement day arrives, I'll already have an individual IRA set up to move the rest of the 401(k) monies into, with twelve stocks already chosen, owned and proven to provide reliable ever-increasing dividend income. (The companies owned all have a history of raising their dividends every year.)I like the free 1% the company gives me, just for being in the 401(k) plan. I like the option to borrow money from my 401(k) plan, pay a low interest rate on the loan and know that the interest rate I'm paying on the loan goes to me (if I were paying a credit card bill of $3,000.00 at 18%, I know I have the option to pay off the high interest credit card loan and pay only 6% interest (to myself) on the $3000.00 loan from my 401(k). I like knowing that when I move the rest of my 401(k) monies into my IRA when I retire, I'll know about how much income I can reasonably expect in dividend income four times a month, twelve months a year (all twelve stocks have staggered dividend pay-out dates, providing cash dividends every week of the year). The companies chosen in my IRA, with their history of raising dividends every year, will provide the comfortable, worry-free income which I believe investing should be all about. My advice on 401(k) plans is to talk to an expert from the firm your 401(k) monies are with and find out what options are available to you and/or what your company allows. My point was simply to inform you that you may not be restricted to just putting your money into a Mutual fund or your company's stock. You can transfer monies from your 401(k) to an individual IRA (Tradition, Roll-Over or Roth), at no fee and build your own Mutual fund. (I have been doing this in my 401(k) plan for years while still employed with my company.) If those companies you choose in your IRA have a dividend reinvestment plan you can request to have the dividends reinvested back into the stock each quarter. And this would be done for you, commission-free. Charles M. O'Melia is an individual investor with almost 40 years of experience and passion for the stock market. Author of the book 'The Stockopoly Plan', published by American-Book Publishing. For more excerpts on'The Stockopoly Plan' visit http://www.thestockopolyplan.com/
MORE RESOURCES:
Google News |
|
|
|
RELATED ARTICLES
How to Use Annual Report There are many steps in calculating the fair value of a company. However, before we even do that, it is imperative to know how a company earns its profit. Volatile Range The stock market fell sharply Thu and Fri before and after the employment reports Fri morning. The Nonfarm Payrolls report showed 207,000 net jobs were added in July, which were 27,000 more than the market expected. Boost Your Income With Financial Spread Betting About 6 years ago I started to notice that certain friends of mine had quit their jobs but continued to live very luxurious lifestyles - seemingly without doing very much. I thought they must just be using up their savings until I discovered they were all making a fantastic living by spending just a few hours a week doing something I had never heard of before - "financial spread betting". Using Divergences to Keep Out of Bad Trades The American Football season just came to an end with my team getting close to the championship but falling short again. I am a big fan of the Indianapolis Colts and we keep having a groundhog day season year after year but it is still fun to watch. Investment Rowing You have rowed a boat at some time haven'tyou? Yes, put the oars in the water and pull. Ofcourse, you don't know where you are goingbecause you are sitting backwards. Four Key Components To Building A Trading System Need some insight on what you should really be striving for when you're building a mechanical trading system? When it comes down to it, there are really only a few criteria that are used in judging the merits of a trading system. The most obvious one is profitability - does the system work? But really, there's more to it than just that. Keep Stock Market Investment Profits Have you had one of those huge investment winners - a stock that went from $2.00 to $80. Creating Momentum with Options - Pro and Cons of At-the-money, In-the-money, and Out-of-the-money To create momentum in your options trading you need to understand the advantages and disadvantages of at-the-money options, in-the-money options and out-of-the-money options.An at-the-money option has both advantages and disadvantages over stock and in-the-money options. Real Estate Clubs Hot Among Investors Six or seven years ago, the stock market was booming, Internet companies that no one had ever heard of were valued at billions of dollars, and anyone and everyone was investing their money in tech stocks. Then, in 2000, the stock market crashed, the Internet companies closed their doors, investors lost trillions of dollars, and life went back to normal, more or less. Stock Market Leaders and Laggards Leaders are stocks that breakout immediately when the market confirms a new rally. In the first several weeks, strong stocks with leadership ability will breakout on volume above their 50-day average. High Volatility Investments Penny stocks and options are high volatility investments that attract both the trader and the long term investor because of the small amount of capital required to make substantial gains as compared with less volatile higher priced stocks. The long term investor buys a stock believing that a company's value will increase over time and the stock price along with it. 5 Day Trading Tips for Success 1. How to Treat Gap Openings A gap up or gap down open is an emotional move, and it often will reverse course and turn in to "trap open". Reasons For Joining An Investment Club Whether you're a novice investor or an experienced stock picker an investment club may be beneficial to growing your investment portfolio. This article explains what an investment club is, why you should have an investment program and finally why you should join an investment club. Day Traders and Swing Traders and Options? Maybe! Typical day traders and swing traders look for stocks with quick,short term movements, and are not in the business of holdingpositions overnight let alone a week or two. So the use ofoptions has not usually been a component of their tradingstrategies. Financial Planners "Financial planners are like dentists: they may occasionally inflict pain, but in the end, you will be better off for following their advice!"Whoever wrote these lines must have either been a financial planner or someone who relied heavily on planners for finance management. We all know that planning our finances is vital. Pros & Cons of Investing in Bonds What are Bonds?A bond is a debt security, by which you are lending money to a government, municipality, corporation, federal agency or other entity known as the issuer. In return for investing in the bond, the issuer promises to pay you a specified rate of interest during the life of the bond and to repay the face value of the bond (the principal) when it becomes due. Chile Leads the Latin Pack Everyone's talking about China. Don't miss the opportunities in the other CHI. Ask The SEC Who is the SEC and why should I ask them anything? The Securities and Exchange Commission in Washington, DC is the government bureau that regulates the securities industry. They make the regulations that all stock exchange listed companies, brokerage houses and mutual funds must follow. The Basics of Tax-Free UK Financial Spread Betting Financial Spread Betting (or Trading) offers a tax free method of speculating on financial markets.Quite simply, if you think a particular index, share, commodity, currency or sector will rise, you place an UP bet. Online Trading Options Strategies - Rolling Rolling is defined in options online trading as moving a position from one strike to another either vertically in the same month, horizontally to another month or some combination thereof.Other times, you may have to buy your short call back so that you will not lose your stock.
|
| home Day Trade Blog | site map |
| © 2006 Day Trade blog investing and stock market resource |
