my mother is 55 and is looking to put $300.00 A MONTH INTO SOME TYPE OF retirement fund.she has no money saved at all to date what would be the best place for her to start saving her money...i know its late in her life to start saving but shes willing to start saving right now...thanks
First, she should open some form of IRA because of the tax benefits. She can open one at any brokerage (discount or full service - whichever she prefers). Tehn, without the IRA she has a world of possible investment opportunities.I would suggest that she should be investing in some form of equities (stock) since, at age 55, her time horizon is sufficient to overcome market fluctuations - such as we are seeing right now.Within the world of equity based investments the most obvious choices are mutual funds and individual stocks. Then, of course, within these two options there are literally thousands of mutual funds and thousands of individual stocks available to choose from.I would suggest a visit to Fool's schools (13 steps to investing Foolishly) on this site for a pretty good summary of the types of mutual funds that are available and the advantages/disadvantrages of each type. Without rehashing the entire series of articles on mutual funds, I will summarize by suggesting that a no load [and the no load part if very important] index fund would probably be a good choice for your mother.Individual stocks offer the potential for extraordinary returns but this potential increase in returns comes with some potenital downside. They are genrally more risky. They require that your mother actively manage her portfolio and perform stock research. They have higher trading costs. With the exception of Dividend Reinvestment Plans (DRIPS - also described in the 13 steps to investing Foolishly] they cannot be purchased economically in $ 300 increments.In the long run, I would suggest that your mother should strive to build a balanced portfolio of some solid invidual stocks and a healthy index fund balance. [That is merely my opinion and other opinions may be equally valid]. Further, I would suggest the following "game plan".1) Your mother should open a no load index fund and start contributing her $300 / month to that account as quickly as possible.2) Your mother should definately read the 13 steps that I keep mentioning. Further, I would suggest a little more reading so that she can better understand the options that are avaialble to her. [The Motley Fool Investment Guide would be a good book to read].3) After completing steps 1 & 2, she can then make an informed decision about how she would like to allocate her final portfoilo among various stocks and/or mutual funds. She can then eiother start redirecting her $300/month into these other invetments or move a chunk of the index fund money into them.
my mother is 55 and is looking to put $300.00 A MONTH INTO SOME TYPE OF retirement fund.she has no money saved at all to date what would be the best place for her to start saving her money...i know its late in her life to start saving but shes willing to start saving right now...Dear bobsmob19,Welcome to the Motley Fool. I just wanted to add some links to the excellent reply by the previous poster. http://www.fool.com/school.htm?ref=G02A06http://www.fool.com/money/allaboutiras/allaboutiras.htm?ref=LNAnd for books: http://www.foolmart.com/Shopping/Catalog_View_Two.asp?CATALOGID=5If you mom hasn't yet registered for the Fool, I invite her to do so: http://www.fool.com/community/register/register.asp?source=CSboardsGood luck! Fool on!Karen KosoyTMF KarenIf you are retiring now or later, don't miss the Roadmap to Retirement seminar. Sign up at http://www.fool.com/seminars/retirement/retirement.htm?REF=PP
I'm 63 and discovered the brothers' book You Have More Than You Think a year and a half ago. Of course I wish I were a lot younger to make use of that wonderful accumulation time but, I do have experience and more common sense than I ever did so it's not too late. Have your mom read that book. Tell her I did, almost as if it were a hot sexy novel, turning the pages quickly cause it made so much sense. She'll have a real good idea what to do after reading and if she needs help she will know what to ask about.Good luck to her...and youJudith
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