investments

[mek42]

We just attended the investment lesson of FPU last night. My wife has a real estate mutual fund available as one of her 403(b) choices. We're thinking about allocating her 403(b) in each of the four categories suggested by DR plus a portion in the real estate fund, each fund getting 20% of the account value. Any thoughts on this proposed deviation from DR?

Next, my Roth is currently in some single stocks and a few options thereof. I enjoy investing and after commissions I was just under the S&P 500 return for 2009. I actually understand single stocks better than mutual funds due to the variety of fees imposed by the mutual funds.

Once we finish BS 2 and 3, I'm thinking to max whatever defined contribution plan my employer might match and allocate that in mutual funds as per DR. With the rest of the 15% going to the Roth, I'm thinking to continue investing like I have been with single stocks and option writing.

In my cash account (non-IRA) with blow money I may consider more speculative strategies such as buying options with blow money as a hobby.

Does this sound like a reasonable plan?

[Greebo]

DR's investment advice is VERY vanilla - it's designed for the layman investor who knows next to nothing about investing, and he REGULARLY tells callers seeking investment advice to seek the advice of a professional.

So when it comes to retirement investing, the 4 way split is *not* a hard and vast rule - he just wants ppl to understand the basics and then find helpers (pros) who will educate you in helping you make the right decisions for you.

Some specifics:
Real estate - depends on the product, but I'll tell you what we do - we split our 15% 50/50 - 50% goes to Roth and 401k, 50% goes into our real estate business (real estate *is* our retirement plan).

ALL of my Roth/401k money goes into mutual funds, because single stocks are not diversified and I *don't* understand them well enough. I don't worry about paying some fees to a mutual fund manager as long as my fund is performing well relative to the market in general.

However, if you LIKE single stocks - as long as you are comfortable with the risk involved, while DR would say he wouldn't, it's got to be a plan that 1) works for you and 2) you both understand (remember, spouses on same page!).

[mek42]

...

However, if you LIKE single stocks - as long as you are comfortable with the risk involved, while DR would say he wouldn't, it's got to be a plan that 1) works for you and 2) you both understand (remember, spouses on same page!).

I'm trying to convince my wife to at least glance through the fund prospectus documents for her 403(b) choices. We have agreed that she'll be doing her 15% through work mutual fund choices and I'll be doing single stocks for dividends and some option writing in my Roth for part of my 15%.

If her 15% ever exceeds the maximum allowable through work, we'll open a Roth from her and discuss what to do with it. If my 15% ever exceeds maximum matching at work and my Roth limit, we'll discuss whether to open a Roth in her name for me to contribute to or for me to contribute non-matching to work or make deposits to a non-IRA investment account for (hopefully) early retirement. What we do with the Roth in her name may well depend upon whose money is funding it.

I know that many folks here might not agree with our separate finances, but it is what works for us. If either of us has a bad week, we only mess up about half the household budget, not the whole thing, etc.