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Easy investing for beginners and everyone

Some people will tell you that you can get full exposure to stock markets around the world by simply buying a single global equity fund, which invests in stocks from around the world. And that’s true. But these funds, not you, decide how much of your money is invested outside the United States.

The Vanguard Global Equity Fund, for example, owns 46% of its investments overseas, which strikes me as high. But it’s your call. Owning stocks inside and outside the United States is what matters. If you were, say, French, Chinese, or Mexican, I would suggest pretty much the same. Own a diversified portfolio with stocks from all over the world, not just your home country.

The bond part of your portfolio can be just as simple. Buy a total bond index fund. He will hold US Treasuries and bonds of all durations – short, medium and long term issues. And if you wanted to put 20% of your bond holdings in an international bond fund, that would be fine for me.

And that’s all.

Each year you can transfer 1% of your money to bonds and leave everything else alone. This means that as you get older, more of your money will be in bonds. This will be a good thing as it will hedge the risk of a sudden drop in stock prices as a time approaches when you need money.

Now, an alternative to transferring the money yourself would be to buy a target date fund, a mutual fund meant to meet the needs of an investor at a specific future date – at the time they plan to take their investment. retirement, for example. The fund will automatically move you to more conservative investments over time.

If you like the idea, just make sure you’re comfortable with what’s in them. Each target date fund is a little different in how it invests, its mix of stocks and bonds, and the percentage of stocks it holds in international holdings.

If you need help with complex financial issues – stock options, for example, if you’re lucky enough to be offered them – or just checking your decisions, I would recommend a paid financial planner. only who invoices by the hour and works. as a trustee. Fee only means they don’t get commissions on what they recommend, and fiduciary means they are obligated to act in your best interests.

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