How do I set-up and/or invest for my future?

Also I know the economy is not in the best of shape, but surely savings or the like is a good idea right?

Contact a reputable retail on line brokerage firm or a local one you trust as they are exactly what you need to get started. Diversification is the key to long term investment strategy and now is an excellent time to buy stock and mutual funds as many still have a ways to go to catch back up to their all time highs.

A Roth IRA is an account that you put money into, after you’ve paid the taxes on earning that money, and when you take it out at retirement, you pay no taxes on it.

An IRA is an account that you put money into, allowing you to deduct that money from your income for tax purposes, and when you take it out at retirement you pay ordinary income tax on it.

Basically a Roth IRA is betting that you will have a lot of money socked away for retirement and will be paying a higher tax rate then than you are now.

A standard IRA makes saving for retirement a little less painful by reducing your current tax bill. It is also a bet that you are making more now than you will be in retirement.

If you are making good money while you are young, a Roth may be the best way to go, if you are older or not making much money a standard IRA may be a better way to go.

By STP index 500 I assume you mean the S&P 500 index, which is a set of stocks that is used as a benchmark for the market as a whole. You can also buy an S&P 500 index fund. That means that you invest with a mutual fund company who takes your investment and all the other investments they get and put them all into the S&P 500 index stocks. Index funds are a great way for novice investors or those who don’t want to deal with a lot of trading to invest. If you really want to just leave the money be for 20 years, index funds are a great choice but you want ones with a low expense ratio. Mutual fund companies charge based on a percentage of the total value invested, not on returns and a high expense ration means a high percentage of the total value. The numbers may not seem high, but you should be aiming for less than ½ of 1%. Anything over 1% should be avoided. If you are leaving the money and for some reason not investing for a while, that expense ratio can be a real hit on your money. It also really sucks when you are suffering temporary market losses, because you still pay the expense ratio as well.

You also need to diversify, so you want several different index funds and some bonds and money market investments as well. All of these investments can be bundled into a single Roth or standard IRA.

Long term this is the right thing to do, assuming that the global economy continues to grow with occasional down cycles. Barring a complete re-structuring of the economy, you will win in the long run.

Can you explain more is to what he meant by the bonds thing? And certain bonds do not go by inflation?

@Cruiser I have to pay those people though right? How would I know if they are trust-worthy?

Stocks – a piece of a company that you own basically?
Mutual Funds – is like buying into a pool of companies?

How hard is it to go to a do it yourself , online type like E Trade for example.

@Steve_A You will pay commissions anywhere you go or at least a small fee for trades if you attempt them yourself. Firms like Schawb are very well established and again perfect for beginner and 1st time investors and having somewhere to turn for advice is worth the small fees. I don’t want to try and tell you what to do let the pro do that and try not to make decisions based on anything you read here. Learn all you can and I will say never act on someones “tip”...make your own decisions. A lot of what you do do will depend on your age and risk tolerance all of which will be discussed with your investment adviser.

@Steve_A Yes, a mutual fund is a pool of companies and Stock is a piece of a company. Stocks pay dividends, but you have to have a pretty good sized investment to invest in enough of them to reduce your risk (don’t put all your eggs in one basket). You also have to watch the markets and business news closely and do a little trading.

Mutual funds spread your risk across a large number of stocks, often in certain categories. Most mutual funds do all the trading and market watching for you trying to maximize return, but they charge you more money to do that and in the long term tend not to be any more successful than an index fund.

Index funds are like mutual funds, except that they just match a market index like the S&P 500 or the Dow Jones index, so they don’t do a lot of trading and can reduce management costs.

You can also buy bonds in indexes or individually.

You can do this reasonably well for yourself online, and there are lots of sites where you can see recommended mixes of investments at varying levels of risk and time of return. In general when you are young you want lots of stocks, very little bonds or money market accounts and you let time do it’s work. As you get older you start moving more of your money to bonds and mutual funds.

I can’t really give you much more detail than that, a financial planner can help, as can many websites such as these: http://www.fool.com/how-to-invest/index.aspx?source=ifltnvpnv0000001

http://articles.moneycentral.msn.com/learn-how-to-invest/home.aspx

I can’t find any of the calculators right now for determining how much of what kind of investment you want, but they’re out there. Most 401k providers will have a free one.

@Snarp @Cruiser

Ok, thanks both , If I have few more questions do you mind I PM eithier?

I have to go now for work OH THE JOY lol…

@Steve_A You can ask, but I can’t guarantee I’ll have an answer.

Motley Fool is a great site to read, but www.weseed.com is a great site to pretend invest. It gives you a chance to build a portfolio and learn about investing without having real money to do so.

Cultivating good financial habits from the moment you start supporting yourself will give you a secure financial future. It takes self-discipline an common sense. You need long term savings (investments), short term savings (money you can get to in an emergency) and moderate spending habits (not incurring debt for things that have no long term value) and building up a credit history (Good payment history.)

The important thing is to learn and keep good money habits right from the start. How much you save or spend can fluctuate with your income, but the habit is the important thing.

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You got a lot of great information already. The only thing I want to add is remember to maintain some cash in savings that you can easily get to in case of emergencies. Ideally 6 months of expenses on hand. Also, you can start slow as you become accustomed to what each of these different types of investments are. You don’t have to dump the majority of your savings all at once into a particular fund or bond. As you start utilizing them you will gain knowledge about them. Best to feel cofortable with your choices. I think it is great that you are thinking about this though. You are ahead of the game.

by becoming a pro bumb !!!

Buy cheap land…that has been cut over or in a rough area and plant pine trees on the land. Buy one piece of land, pay for it..and then buy another piece…and so on! Also, if you ever decide to cut the timber, be sure to get a bid from Weyerhaeuser. They give top dollar and when people ride by the land, they will never know Weyerhaeuser was there. Weyerhaeuser is an awesome company. Also, buy their stock! Now, is the time to buy it..their stock is not expensive now.

@BoBo1946 I will look into that, thank you.

Read all you can to gain a familiarity with the choices. Look at Money Magazine for investing information, and the links provided here by other users.

If you’re just starting out, the first thing to do is save some money in a rainy day. It will provide some security if you have to deal with a health problem, a layoff, or a car repair.

The next thing to do is investigate employer savings programs. The 401k program allows you to save money while reducing your tax bill, and may even have an employer match. If your employer matches part of your 401k contribution, make sure you take advantage. Even if there is no employer match, you should be able to save at least a thousand dollars in taxes by participating.

Pick up a copy of Phil Towns ‘Rule #1’

His book and interactive website helped me get my feet wet in the market a few years ago.

Also, yes, read Money mag. and as @PandoraBoxx mentioned Motley fool.

I have had moderate success with pharmaceuticals, Pfizer, and had a good yield on some AT&T, Vodaphone stock a few years ago when I cashed out.

Drugs and communications, always pretty solid.

If you are especially brave you can look into oil wells and wildcatting investments.

Risky, but if you get in on a good producing well in a stable field it can produce for 20–30 years, max. optimum. But this is a high risk investment.