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eeyorethegreat
09-05-2008, 03:22 PM
We own some Disney stock but really don't know much about the stock market. can someone tell me what are some good safe(r) stocks to invest in for a beginner. We probably aren't going to be buying and selling but looking more at long term investment. We have never had any money to really invest so this is new to us (not that we have a lot now but we debt free except for mortgage and car payment so we are looking at different possibilities to invest our money). Thanks I know there are many here who are knowledgable in investments.

An_Island_Girl
09-05-2008, 03:40 PM
My Grandmother used to always tell us to buy into stocks that we use their products. Do you use Johnson and Johnson, Heinz, Sara Lee, Apple, etc? If you use a company's product exclusively than other people must be too! I wish I had a crystal ball for all of these great new companies, but the tried and true has served our family well during these slippery slope stocks lately.

HeatherC
09-05-2008, 03:44 PM
What you may want to do first is read up on stocks.

There are many different ways to invest. One way we do it is to invest in a stock mutual fund through a company like TRowePrice. They will monitor the stocks in the fund and add to them and sell off shares as they see fit. In other words, they manage the fund so you don't have to.

What you can do is research the fund, pick how much you'd like to invest and have it taken out of your account monthly. It adds up very quickly this way.

If you prefer to invest directly in a specific stock, you could also consider www.sharebuilder.com. They will take a certain amount of money out of your bank account either weekly or monthly (you pick when and how much). Then you tell them what to buy for you.

Hope some of this info is helpful to you.

Good luck!

Pigeon
09-05-2008, 04:02 PM
I agree that a decent mutual fund is a good way to start. Find a good no-load fund with low expenses. Funds have managers who study the stock market all the time, so it's less risky than trying to pick stocks on your own. Most of the financial magazines devote at least one issue per year on comparing mutual fund performance. Go to your public library and do some browsing.

SuzanneSLO
09-05-2008, 04:42 PM
There are also mutual funds called index funds that essentially invest in the entire stock market or portions thereof. The expenses charged by the managers of these fund are usually lower, which means more of the gains remain in account.

Some good books to read before you start investing are "The Only Investment Guide You'll Ever Need" by Andrew Tobias and "Investing for Dummies" or "Mutual Funds for Dummies," both by Eric Tyson.

Best of luck -- Suzanne

eeyorethegreat
09-05-2008, 07:12 PM
Thanks for the comments. I knew I would get some pointers on where to start and what to look into here.

EthansMom
09-05-2008, 07:30 PM
I'll second Suzanne's reading recommendations.

Also, I'll second (or third) the recommendations to look at Mutual Funds, which invest in stocks from a LOT of companies at one time. For a beginning investor, I highly recommend a 500 Index Fund, which mirrors the stocks in the S&P 500 Index. Because the stocks of the S&P 500 change rarely, the 500 Index Mutual Fund doesn't buy or sell it's stock holdings much (so low management fees).

I've had accounts with both Vanguard and Fidelity and found their websites and telephone customer service to be very helpful. Both offer a lot of investment options and plenty of no-load funds.

Also, you should consider how you wish to purchase these funds. Do you want to open a Roth IRA and have the mutual funds in there? If you qualify for a Roth IRA, the profit on your investment may be tax-free if you keep it there until retirement. Other options include a Traditional IRA (contributions might be tax-deductible in the year you contribute); a 529 Plan or Coverdell IRA (college-savings versions of the Roth); or in a regular, taxable account. Each of these has it's benefits.

The retirement and college options are excellent for tax-deferral. But a taxable account offers more flexibility for withdrawal if you might need to cash out (say, for an emergency) later. If you opt for the taxable account, I recommend checking "yes" to dividend reinvestment which would automatically reinvest any dividend checks from the stocks and helps increase your holdings.

I hope this helps!