The disclaimer comes first. Don’t take this purely as advice for your situation. Even a lot of people who called themselves “experts” you should be skeptical of, and I’m not expert. With that said, here are my discoveries…

You’ve heard it before: don’t put all your eggs in one basket. I’ve really taken that to heart, seeing the ups and downs of my first stock purchase back in 2008. Recently, I have diversified my portfolio and have also started looking for a place to stash some cash. I know, you’re probably thinking “You can put some cash in my pocket,” but I bet you won’t pay interest.

If you are having trouble saving money to put back for retirement, here is an idea that might help you. If your employer offers direct deposit, have them take out an amount every week that you won’t miss. In my case, that small amount goes straight into a bank that I only have a savings account with and rarely visit. It’s really out of the way, which is great because it’s not so tempting to use that money on a whim for something else. When I reach a goal of $500 or $1000, for example, that money gets invested.

CDs

CDs are a tricky thing these days. Rates are sooo LOW, LOwww, lowwwwwww, but the important thing to remember is that rates are even lower for that money sitting in your savings account. Although you will get a higher interest rate for that five year CD, a lot can happen in that time. Your best bet is probably going to be to lock away that money for two years and search for better rates when that term is almost up. Alternately, if you plan on socking away, say, $1,000 in a CD every year, you could continually set up 5 year terms and, eventually you’ll get to the point where you have a CD term ending every year.

Now, when it comes to IRA CDs, the guidelines are slightly more complex. With that direct deposit money I spoke about, I was going to set up an IRA CD at one of the banks that had a higher yield rate listed on bankrate.com or bankaholic.com (I forget which). With the particular bank in question, I browsed through some reviews and decided to navigate on over to their website to start setting up an account. I think that’s when the Lord Almighty blessed me with a sign… honestly. I filled out all my personal information, clicked “submit” and suddenly lost my internet connection. When it came back, I was like “Okay, I’m going to read a little more and make sure this is the right bank.” It turned out it wasn’t. I discovered some fine print on another page saying they charge an annual $30 IRA account maintenance fee. I was going to make about $10 a year on the two-year CD I was going to set up, so going with that bank would have actually made my retirement account lose $20 a year!


STOCKS

When I first bought stock, I didn’t have the freedom to decide what broker I was going to use. My employer decided that, as I was purchasing through an Employee Stock Purchase Program. The broker is a major one that you’ve heard of, and I like how the system works. I bought the stock when it was at an all-time low in 2008, at less than $1 a share. Knock on wood, but the stock has shot up since then, back to a more normal value for that company. A dividend is paid on the shares every-so-often, and the dividend reinvestment program is awesome. It’s great to periodically check in on your account and discover that you have more stock shares than the last time you logged in.

Automatic dividend reinvestment is great, but some DIY stock brokers like Scottrade don’t allow it. Instead, when a dividend is paid, the money goes into your account. It seems like a ploy to add money to your overall balance, to get you to buy more stock, which means having to pay the $7 transaction fee more often.


IRAs

This is where it starts to get into those murky, giving-specific-financial-advice waters that I am trying to steer clear of. But if you don’t already have an Individual Retirement Arrangement (IRA), they are a smart choice. There are some limitations, but the tax benefits can be great. This year, the maximum contribution limit for most people is $5,000. There are also some income limits to consider. If you’re earning a six-figure income every year, chances are you’re not eligible.

Roth and Traditional IRAs each have their own tax rules but, in my exploration, it seems that most people prefer the Roth. With the Traditional IRA, you can deduct your contributions on your tax return every year, and you pay on your earnings when it’s time to retire. With the Roth, you can’t deduct the yearly contributions from taxes, but the money isn’t taxed at retirement. In other words, for people who can do without that tax break, it’s probably wiser to go with the Roth. Again, though, consult an adviser for your personal situation.

Another thing I have learned is that contributions to your IRA have to be cash, unless you’re rolling another investment vessel like a 401k into the account. Otherwise and unfortunately, you can’t do things like take stock shares in a regular account and transfer them directly to an IRA. Rather, you would have to sell your shares and use the proceeds as a contribution to your IRA. From there, you could buy shares of the same stock again if desired, but that wouldn’t be so wise because of the taxes you would have to pay on the stock sale. I would love to make a hefty profit, then move it to a tax-advantaged account, but it’s just not to be.

That just about sums about my recent discoveries for now. If you have any questions or have your own helpful tips to add, feel free to comment below. Happy investing, and good luck!

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Maybe I just don’t get it. Maybe I’m disillusioned. But it seems that the real trick (which seems like no trick at all) to “beat the stock market” is patience. Patience. There’s so little of that these days. People – advertisers, investors, marketers, boards of directors – brainstorm and work so hard to retain our interest, ranging from the duration of a movie to the duration of a commercial. When that patience fades and you start to mix in a little fear, you end up with something that can get very ugly.

The part of me that may be disillusioned and allows me to perpetually keep a positive outlook is that I can’t recognize the things I don’t know… blissfully unaware, I suppose you could say. The more I learn, the more I realize there is a science to everything. And the more science explains a story, some of the magic can start to disappear.

I currently own one stock and am weighing my options for buying more in different companies. The stock I do own is the result of an Employee Purchase Program. It was kind of a fluke… I signed up for the program without really thinking it though.

The employer would set aside 5% of my check every week, figure out the lowest price of the company’s stock for the quarter, then give me a 10% discount off the stock. Then that weekly money set aside would be used to buy the stock. At the lowest point, I bought stock for $00.88. That’s right – I bought stock when it was on its way to being worth nothing. Then it turned around. It climbed up to $12+ at its high, and it’s back down now to $7-something. That’s still not bad…. and, for me, it was all on a whim. Also, don’t think I’m a bajillionaire now because I’m way, way, way far from that.

Where this decision to buy worked out, I also could have bought a flop, which is what happened with the stock from my other job at the time. My boss there said “You don’t wanna buy that… media stock is never worth anything.” I thought about buying some anyway but didn’t. About a year later, that company’s stock was delisted from the New York Stock Exchange. Not good.

At this very moment, I am at a crossroads. It feels like I am in a very adult place at this point, where I have to weigh my options and try to make the best decisions for myself and my family. I keep thinking about dumping the shares I have but can’t ever make that decision hit the “sell” button and jump. I set a target sell price when it was over $12, then missed it when it dipped below that mark. So now it’s like “I should have sold then……buy maybe it will climb back up.” That’s where patience comes into play. One of my family members lost a lot of money in stocks 20 years ago. I don’t know what the stocks were exactly, but I have to wonder how the price compares today to what it was when she decided to sell.

Anyway, it’s time to diversify. It’s a lot of decision-making to prioritize my list of potential buys, which consists of some cheaper, industrial companies (for now, HAH-HAH!!!) and some blue chips. Whatever happens, when my gut stops telling me conflicting things, I certainly won’t be putting all my eggs in the same basket.

Whoever thought diversification would be so hard? Yet the whole process is also very liberating at each step, when you’ve saved up enough, a little bit at a time, to put away for decades.

I guess no matter what happens, I just need to remind myself to breathe… and to have a little patience.

I received this from someone who had apparently received this email from someone else, from someone else, and on down the line. Could I be a mere five steps from Mark Zuckerberg?! Jokes aside, here is the email, which made me laugh, and it’s too funny not to share with you:

A Letter from Mark Zuckerberg

About Facebook’s IPO

MENLO PARK, CA (The Borowitz Report) – On the eve of Facebook’s IPO, Founder and CEO Mark Zuckerberg published the following letter to potential investors:

Dear Potential Investor:

For years, you’ve wasted your time on Facebook. Now here’s your chance to waste your money on it, too.

Tomorrow is Facebook’s IPO, and I know what some of you are thinking. How will Facebook be any different from the dot-com bubble of the early 2000’s?

For one thing, those bad dot-com stocks were all speculation and hype, and weren’t based on real businesses. Facebook, on the other hand, is based on a solid foundation of angry birds and imaginary sheep.

Second, Facebook is the most successful social network in the world, enabling millions to share information of no interest with people they barely know.

Third, every time someone clicks on a Facebook ad, Facebook makes money. And while no one has ever done this on purpose, millions have done it by mistake while drunk. We totally stole this idea from iTunes.

Finally, if you invest in Facebook, you’ll be far from alone. As a result of using Facebook for the past few years, over 900 million people in the world have suffered mild to moderate brain damage, impairing their ability to make reasoned judgments. These will be your fellow Facebook investors.

With your help, if all goes as planned tomorrow, Facebook’s IPO will net $100 billion. To put that number in context, it would take JP Morgan four or five trades to lose that much money.

One last thing: what will, I, Mark Zuckerberg, do with the $18 billion I’m expected to earn from Facebook’s IPO? Well, I’m considering buying Greece, but that would still leave me with $18 billion. LOL.

Friend me,

Mark