Personal Investing: The Missing Manual

Book description

Your financial goals probably include a comfortable retirement, paying for your kids' college education, and long-term healthcare. But you can't reach those goals by putting your money in a savings account. You need to invest it so it grows over time. Three seasoned personal finance experts show you how in this jargon-free guide.

  • Investing demystified. Get clear, real-world examples of why investing is crucial to your financial goals
  • How to invest. Learn how to evaluate four types of investment so you make the right decisions
  • Hidden gems. Discover lesser-known, low-cost investments that provide tax advantages
  • Retirement, Education, Healthcare. Find chapters devoted to the fine points of each of these big-ticket goals
  • Flexibility. Learn how to change your investment strategy as you age
  • Choices. Find an investment plan that's right for you -- whether you're a conservative investor or go-for-broke risk-taker

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Table of contents

  1. A Note Regarding Supplemental Files
  2. The Missing Credits
    1. About the Author
    2. About the Creative Team
    3. Acknowledgments
    4. The Missing Manual Series
  3. Introduction
    1. Why Investing Is Important
    2. The First Step: Planning
    3. Simple Steps to Successful Investing
    4. About This Book
      1. About the Outline
      2. The Very Basics
      3. About→These→Arrows
      4. About
      5. About the Missing CD
      6. Safari® Books Online
  4. One. Prepare to Invest
    1. 1. Why Should You Invest?
      1. How Inflation Hurts
      2. Why Scary Numbers Aren’t That Scary
        1. How Investing Makes Your Money Work Harder
        2. Investing for the Long Term
    2. 2. Set Your Investment Goals
      1. Building Your Bucket List
      2. Retirement, College, or Other Goals
      3. The Big Kahuna: Retirement
        1. When You Retire
        2. What’s Retirement Going to Cost?
        3. Sources of Retirement Income
          1. Thanks, gov!
          2. Pension plans
          3. Work during retirement
          4. Nest egg income and principal
        4. Building Your Retirement Plan
      4. Other Long-Term Goals
        1. Health Care and Long-Term Care
        2. College Savings
        3. Caring for Aging Parents
        4. A Second Home
        5. Leaving a Legacy
        6. Fun Stuff
      5. Putting It All Together
        1. What If I Can’t Save Enough?
    3. 3. Invest with Open Eyes
      1. Clean Up Your Finances
        1. Borrowing for a Good Reason
        2. Get Rid of High-Interest Debt
      2. Spend Money Wisely
      3. Expect Base Hits, Not Home Runs
      4. Sidestepping Pitfalls in Investor Psychology
        1. Which Type of Investor Are You?
        2. Protectors
          1. Protectors’ bad habits
          2. Protectors’ new habits
          1. Followers’ bad habits
          2. Followers’ new habits
        4. Leaders
          1. Leaders’ bad habits
          2. Leaders’ new habits
        5. Power Players
          1. Power players’ bad habits
          2. Power players’ new habits
  5. Two. Choose and Buy Your Investments
    1. 4. How Investments Work
      1. The Big Four: Typical Investments
        1. Stock: Owning Part of a Company
        2. Bonds: Lending Money
        3. Investing with Others: Funds
        4. Real Estate Investment Trusts (REITs)
      2. Taxing Decisions
        1. The Big Tax Bite
        2. Making the Most of Tax-Advantaged Accounts
        3. Tax-Advantaged or Taxable: Where to Put Investments
        4. Managing Taxes in Taxable Accounts
    2. 5. Funds
      1. The Vanilla, Chocolate, and Strawberry of Funds
        1. Index Funds: Taste Great, Less Filling
        2. Mutual Fund Basics
        3. Exchange-Traded Funds
      2. What a Fund Invests In
        1. Asset Allocation Categories
        2. Investment Style and Size Categories
        3. Bond Fund Characteristics
        4. Does the Fund Do What It Says?
      3. Evaluating Fund Performance
      4. Keeping a Lid on Fund Expenses
      5. How to Pick Funds
        1. Choosing an Index Fund or ETF
        2. Evaluating Actively Managed Mutual Funds
      6. Finding Funds
      7. Deciding When to Sell
      8. Managing Your Funds
        1. Avoid Overlapping Funds
        2. Managing Taxes
        3. Making the Most of Limited Choices
    3. 6. Stocks
      1. Buying into a Business
        1. The Income Statement
        2. The Balance Sheet
        3. The Statement of Cash Flows
      2. Investing in Growth
      3. Investing in Quality
        1. Dealing with Debt
          1. Debt-to-equity ratio
          2. Interest coverage
          3. Current ratio
          4. Quick ratio
        2. Management Effectiveness
          1. Return on equity
          2. Return on assets
          3. Turnover ratios
        3. Profitability
      4. Investing in Good Value
        1. Price Ratios
          1. Other price ratios
        2. Dividends and Yield
      5. Watching for Trends
    4. 7. Bonds
      1. Why Invest in Bonds?
      2. How Bonds Work and How You Use Them
        1. Bond Credit Quality
          1. Avoiding default
          2. How credit quality affects bond interest rates and prices
        2. Bond Maturity
        3. Bond Interest Rates
        4. Understanding Bond Prices
          1. How market interest rates affect bond prices
        5. Interest Rate Risk
      3. Buying Bonds
        1. Building a Bond Portfolio
    5. 8. REITs
      1. Is REIT Investing Right for Me?
        1. The Pros
        2. The Cons
        3. A Lesson in REIT Returns
      2. Types of REITs
        1. How REITs Make Money
      3. Picking Individual REITs
        1. Looking at Strategy
        2. Looking at the Bottom Line
      4. Finding the Right REITs and REIT Funds
        1. Screening REITs
        2. Screening REIT Funds
    6. 9. Manage Your Portfolio
      1. What’s Investment Portfolio Management?
      2. Return vs. Risk
        1. Face Your Fears: Understanding Investment Risks
      3. Asset Allocation
        1. Other Ways to Diversify
      4. Choosing an Asset Allocation Plan
        1. Using an Online Asset Allocation Tool
      5. Asset Allocation Made Ridiculously Easy
        1. Building a Lazy Portfolio
        2. Stealing a Lazy Portfolio from an Expert
      6. Reviewing Your Portfolio
        1. Checking Your Asset Allocation
        2. Checking Up on Funds, Stocks, and Bonds
      7. Rebalancing Your Portfolio
      8. Getting Back On Track
  6. Three. Manage Your Investments
    1. 10. Investing for Retirement
      1. The Key Retirement Decisions
        1. When You’re Going to Retire
        2. What Retirement Will Cost
      2. Making the Most of Retirement Accounts
        1. Making the Most of Your 401(k)
          1. Why you should contribute to your 401(k)
          2. The downsides to 401(k)s and 403(b)s
          3. Rolling over a 401(k)
        2. Choosing an IRA: Traditional or Roth?
          1. Traditional IRA
          2. Roth IRA
        3. Should I Convert a Traditional IRA to a Roth IRA?
          1. Using a Roth conversion calculator
      3. Managing a Retirement Portfolio
        1. When Retirement Is Way in the Future
        2. The Red Zone
      4. Making the Most of Social Security
        1. The Benefit of Delaying Benefits
          1. Social Security delayed retirement credit
          2. Increased earnings
          3. Life expectancy
        2. Working and Receiving Benefits
      5. Withdrawing Money During Retirement
        1. Figuring Out What You Can Spend Each Year
        2. Creating a Retirement Paycheck
    2. 11. Investing for College
      1. College Costs How Much?
      2. Tax-Savvy Ways to Save for Education
        1. Section 529 Savings Plans
        2. Section 529 Prepaid Plans
        3. Coverdell Education Savings Accounts
        4. Uniform Gifts to Minors Accounts
      3. How to Pick a 529 Savings Plan
        1. Choosing investment options
          1. Choosing investment options
        2. What to Do with Excess College Savings
      4. Saving for More Than One Child
      5. The Best Way to Spend College Savings
    3. 12. Investing for Health Care
      1. Types of Health Insurance
      2. Choosing an Employer-Sponsored Plan
      3. Choosing an Individual Health Insurance Plan
      4. High-Deductible Health Insurance Plans
        1. Health Saving Accounts
          1. Setting up an HSA
          2. Choosing an HSA provider
          3. What are qualified medical expenses?
        2. Why Go High-Deductible/HSA?
      5. Negotiating with Health Care Providers
      6. Paying for Long-Term Care
  7. Index
  8. About the Authors
  9. Copyright

Product information

  • Title: Personal Investing: The Missing Manual
  • Author(s): Amy E. Buttell, Carol Fabbri, Bonnie Biafore
  • Release date: May 2010
  • Publisher(s): O'Reilly Media, Inc.
  • ISBN: 9781449381783