UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev Thread | Prev | Next | Next Thread
Author: WilliamLipp Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75839  
Subject: Re: Retirement Date: 8/2/1999 10:51 AM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
chmiller10 Date: 8/2/99 9:37 AM Number: 12694
I am a newly retired teacher with 60K that I must rollover from my pension fund into an IRA. I have a broker at Prudential who was recommended to me by my mother and he has done very well by her.

This broker will probably be charging you much more than $10 commission per trade. The first question is whether you need such a broker - it doesn't sound like it below. You can find information about selecting a discount broker on the Discount Brokers board and their FAQ.

The second question is the standard used to measure "has done very well by her." The Foolish standard would be to compare the performance of her portfolio to the S&P500 with dividend reinvestments. The reasoning is that index investing is a no-effort approach that can be managed for extremely tiny fees, so anybody making money from your investments should be adding value above this "dumb-as-a-stump" approach." Take a 3-5 year period for the test, and take all money at the beginning of the period and invest in S&P500. Add and subtract cash the same as she did, buying and selling S&P500. It's simplest to ignore dividend reinvestment for the first approximation, and just use the S&P500 index (which does not reinvest dividends).

I am looking to do the Fool 22345
While this is still a respectable Dow Dividend Approach, the Fools have found some they like even better. They've changed the Dow Dividend Approach that is the Official Foolish Four twice since this one. Check out the Foolish Four Portfolio Report and the informational links from their to learn more about this.

I am new to this game and would appreciate some one's opinion on the above

You seem to have a careful, methodical, reasonable approach to this. I think you are going to be thrilled at the information you find around the Fool. If you haven't done so, you should consider a quick cruise through the Fool School's 13 steps to Foolishness from the Home Page - it sounds like you already know most of this but might find a few additional nuggets.
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (4) | Ignore Thread Prev Thread | Prev | Next | Next Thread

Announcements

The Retire Early Home Page
Discussion on accelerating retirement day.
Pencils of Promise - Back to School Drive
"Pencils of Promise works with communities across the globe to build schools and create programs that provide education opportunities for children."
Managing Your Wealth
Our own TMFHockeypop from Rule Your Retirement fame on the TV show Managing Your Wealth.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Macro Economics

Should You Be an Index Investor?
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement