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Author: RodeoKing Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75375  
Subject: Re: Help me flesh out my 401k Date: 2/28/2009 9:15 PM
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Well, I meant for a quick post, but since you asked:

Q: Seriously, I hope this is not how you plan to invest for your retirement - going to a discussion board and asking people you don't know to advise you on stock picks. What will you do with the information?

A: Why do these discussion boards exist, if not to provide a forum for discussing investing ideas among individuals (OK, strangers) interested in investing? I will evaluate any recommendation using the process I use for every potential stock purchase. I'll look at the fundamentals of the company, the current valuation, and think about how the company fits into the broader context of its industry and the overall economy.

Q: idea in your head - about what your eventual retirement nest egg will look like? How much will you need?

A: I'd like to retire with $2 - $3 million in today's dollars. That range will likely turn into $7 - $11 million 40 years from now, once inflation is factored in.

Q: In what type of assets?

A: Since I'm young, I plan on going 100% into equities for the next 2 - 5 years. As I near retirement I'll add less risky investments like bonds and cash. As for specific equities, I've listed them. I was hoping someone could recommend a few good stocks in sector/industries that I don't have represented in my current portfolio.

Q: How will you build it?

Monthly contributions. I send 8% of my $69920.00 gross annual salary into my 401k. My employer matches up to 4.5%. At my current pay rate, that is $8740 a year. The same ratio of my bonus goes into my 401k each year. So, I should have about $10,000 going into my 401k this year.

What will your risk tolerance be?

See answer to asset class question.

What vehicles will you use (besides your 401k)?

Besides my 401k, I plan to invest through a regular, taxable account. I understand I'm giving up tax benefits by going this route as opposed to an IRA, but I may decide to use the money for a house or other large purchase in the near to mid future. And I don't want to worry about penalties.

Now that I put my original question into context, do you have any recommendations for me that aren't on that short list I mentioned?

As for now being a bad time to go long on stocks, I think now is the best time to start accumulating equities. While we might not be at the bottom right now, I can be sure that I'm buying stocks while they're historically cheap. I'm a long-term bull. The best days are ahead of us!
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