Hi Guys! I've been lurking around these forums for a while and decided to make a first post. I'm 21 single, young and living at home (and paying no rent or board). no debts or liabilities either I've just finished uni a week ago and have gotten my first full time job as an intern pharmacist (before this i was working casually and earning enough to survive and to fund a lifestyle of buying phones and ipods and lots of other crap to my hearts content but now i've finally decided to grow up a little ) I've done some calculations and have worked out i can afford to put away about $800 a month after taxes and expenses. At the moment i have around 2k set aside in an ING account and i add it to as much as i can. I also have $700 in super (which i add to fortnightly, about $50) and a disaster fund which i add to fortnightly. My question is how should i get started! I've been doing lots of reading into managed funds, index funds, etfs, LICs, LPTs etc etc I've got a brokerage account at e-trade and bell-direct and an account at investsmart (as well as a nice pile of managed funds prospectuses on my desk) My general goal super longterm is to be financially independent.. what does that mean? I'm not really sure but i have set myself a goal to be worth $100 000 by the time i am 25 through saving and investing. By then i may consider getting an investment property or just sitting on my portfolio and adding to it. At the moment i am looking for capital growth and with plans to reinvest any dividends and distributions back into whatever it is i plan on investing in. (I have no need for extra income atm) I was thinking either to invest in one of those generic multimanager managed funds such as CFS FirstChoice Growth or Blackrock Growth which will give me instant diversibility and let me add drip-feed it with money OR Investing in exchange traded securities and starting by buying $1500-$3000 bundles of STW, ARG and AFI every few months and building that up slowly (i am not ready to trade individual securities yet.. not for a long shot so i feel much more comfortable letting a professional handle it) My understanding is that either way i will be reasonably diversified through a single transaction (e.g. australian shares, property securities, infrastructure securities etc). Having said that; i am pretty okay with risk and will be okay with volatility if it means better chance of long term gains. I know that the managed funds will attract more fees (CFS FirstChoice Growth has an MER of 1.90% and 0.2% transaction fee) but with listed securities i have to pay brokerage ($15 a trade with bell direct) but lower ongoing management fees. I don't know which to pick or what to do! A) Is it worth me trying to invest now.. or should i sit on it and accumulate more money before taking a plunge into Investorworld b) Should i see a planner? Is it worth it for such a small starting amount of money C) What would be better in your opinions? Managed fund or LICs+ETFs or somethign else entirely? Thanks Guys! Look forward to hearing from someone
Hi Krevo, Check out Personal Investors | Home | Vanguard they buy the index as opposed to taking active positions in stocks which active fund managers think are going to out perform or under perform. Also the retail MER is 0.75% so it is very attractive fee wise and you can add regular contributions. Cheers, Dan PS This is general information. Before making an investment decision speak to your FPA registered Financial Planner.
