Investing

Investing#

Mentimeter Question

https://www.menti.com/alohp2v13yqh

Before investing#

  • Payoff debts

  • Build emergency funds (General rule: Be able to cover 3-6 months of expenses)

Investing versus saving#

Liquid versus non-liquid assets#

  • How quickly can I cash out my investment/assets?

  • Are there any penalties/fees for early withdrawl?



Investing options#

Standard investment options#

  • Savings

  • Money Market

  • Certificate of Deposit (CD)

  • High Yield Savings Accounts (HYSA)

  • Bonds

  • Stocks (Index Funds)

  • Real estate

Speculation (risky investments)#

  • Lottery

  • CryptoCurrency

  • Individual stocks

    • Meme stocks (Gamestop)

    • Stock options



How & where to invest (keep it simple)#

  • Company investments

    • 401K

    • Employee Stock Purchase Plans

  • GWU investment options

    • GW 403(b) Supplemental Retirement Plan

    • GW 401(a) Retirement Plan for Faculty and Staff

    • GW 457(b) Deferred Compensation Plan & GW 457(f) Restoration Plan

    • HSA

  • Online broker (Vanguard, Schwab, Robinhood, etc.)

    • target age retirement fund

    • index funds

    • ETFs (groups of stocks)

    • traditional & roth IRAs (tax benefits)

    • actively managed funds (beware)

    • Robo advisers (automated allocation and diversification offered by many online brokers)

  • Certified Financial Planner (CFP)



Free money (Yes you heard that right)#

  • Company benefits

    • 401k matching

    • 403(b) with 401(a) funding plus matching

    • Employee Stock Purchase Plan discounts

    • Tuition Remission & Exchange

    • HSA and other tax free options

    • Dependent Daycare

  • For advanced users only

    • Gaming the system with reward credit cards

Mentimeter Question https://www.menti.com/alohp2v13yqh

Investing strategies#

  • Diversify

  • Low or no fee index funds

  • Be wary of investment advisers

  • “Past performance does not guarantee future results”

Invest early and often (more compound interest magic)#

Set it and forget it#



S&P 500 Invest \(\$\)100, 1957-2023#

If you invested \(\$\)100 in the S&P 500 at the beginning of 1957, you would have about \(\$\)72,148.05 at the end of 2023, assuming you reinvested all dividends. This is a return on investment of 72,048.05%, or 10.32% per year.

This lump-sum investment beats inflation during this period for an inflation-adjusted return of about 6,553.58% cumulatively, or 6.47% per year.

S&P 500 Historic Returns



S&P 500 Historic Chart#

S&P 500 Historic Chart



S&P 500 Historic Annual Returns#

S&P 500 Historic Annual Returns

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