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Author: RetiredVermonter Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75384  
Subject: Starting out investing Date: 10/2/2003 9:36 AM
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I just came across an apparently expired posting about starting out investing and tried to post the following, but will repeat it here for whatever it may be worth.

Please note: I am NOT a professionally trained counselor, nor do I claim to be anything more than an ordinary person who decided he wanted to learn about, and try, investing.

I've been dabbling with buying and selling stocks for several years now. I got "bitten" and lost some money up front, too, in the learning process. (I've also sometimes lost some along the way, but we won't get into that! However, overall, I do pretty well now that I have learned the ropes.)

First question: Can you afford to LOSE that startup money or more? It can happen, especially starting out, when you're going to make mistakes -- and we ALL make mistakes. No one I know has a crystal ball.

Second question: Have you got an online account, with LOW commissions? That can make a difference! LOTS of them offer low commissions, even as low as single-digit.

I have an on-line account within my Fidelity, simply becasue this was a 401k that I rolled over into a self-directed IRA. (I do NOT recommend this for a neophyte, nor do I recommend that anyone start playing around with much of his/her IRA money -- it can be too dangerous! However, I earmarked a set amount, beyond a carefully diversified group of mutual funds -- which I also monitor and sometimes adjust.)

As a retiree, my arrangement offers advantages over a cash account. Namely, I pay no capital gains taxes on whatever I make in there -- only income taxes, in my bracket, whenever I withdraw anything. In my current "low" bracket, after deductions, I may pay few taxes that way, which can be advantageous.

There are a zillion sources of information on line nowadays, of course. Aside from our good folks right here, I have bookmarked Yahoo's "In-Play", for example, which updates all day, starting around 6:30 a.m., for sudden news.

I suggest new investors get their feet wet carefully, with one or two buys of what appear to be good, sound investments. Remember, as in all things, if it looks too good to be true, it probably is and can bite you!!!

My two cents... and maybe worth about that!

Retired Vermonter
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