Reply to How do I learn to be a savvy investor?

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[quote=Anonymous]Start off simple. If you just want to invest in the "market" -- invest in an S&P ETF or Vanguard Fund that gives you exposure to the S&P; that means that if the S&P goes up 5%, your money goes up 5%.

Then once that's done, you can see if you're interested in certain sectors. If you want additional exposure in a couple sectors like technology or healthcare or real estate, you can put additional funds into a mutual fund or ETF that invests ONLY in that sector. The key difference between mutual funds and ETFs is that a mutual fund is actively managed by a portfolio manager who picks/chooses what stocks to hold and when to sell while an ETF is algorithmic /automatic investing done by computer programs. ETFs have lower expenses (usually) than mutual funds bc you're not getting active management -- but in certain more volatile sectors, active management is worth the fee.

Overall just keep it simple -- S&P index funds and large mutual funds run by Vanguard or Fidelity. It's when people get cute that they lose money or make less money than the overall market. I wouldn't attempt to pick individual stocks.

While I'm not opposed to buying income property -- be very sure about what you're getting into -- i.e. what expenses will you have for mortgage/taxes/HOA vs. what rent can you command AND is it an area where you can consistently keep your property rented AND do you need a property manager for maintenance/repairs etc. and how will that eat into your rental income.  I have always thought of buying rental property and then every time, I research for a couple weeks and decide -- let me just throw $ in the market with a few clicks of the mouse; it's just easier with a more "immediate" return.[/quote]

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