I would avoid recommending specific investments to someone without some basic knowledge in the field. That might lead to trouble down the read.
This doesn't make much sense to me. Investing in VTSMX over having money in a savings account probably has the highest ratio of additional return divided by effort involved, and is justified by two sentences and a question: "When you invest in a specific stock or fund manager, you're betting that you know more about that vehicle than the whole market. When you invest in an index fund, you're betting that the long term trend is up. Given the existence of Wall Street, which bet would you rather take?"
That is to say, one of the main reasons that sleep-at-night investing is so valuable is that you sleep at night. Set up automatic investing into your Vanguard fund, and you're done. Knowing more of the philosophy behind it can help, and will make you less likely to panic and sell during a downturn, but the initial bump into an index fund is the main value-add.
Probably yes. But if you do not know the reasoning behind that chances are high that the first economic crisis makes you sell your stock at bad timing.
Hey everyone,
I'd like too see if I can utilize the rational powers of Less Wrong
Currently I work full time. Am well paid for my age. Have approximately $20,000 AU in savings.
My spouse is in uni. Will finish this year and begin working next year. But currently I am supporting our household.
I have recently concluded that $20k is too much to be sitting idle, and the rational thing to do would be to find a way of putting those savings to work in some fashion. But how?
What would be the best way of utilizing these finances in terms of self-development and/or monetary return?
A few things to consider:
a) My skillset at the moment is limited, but I am eager to learn anything.
b) I only desire money in that it enables me to carry out many plans that would be difficult otherwise.
c) Relationships are far more important to me than money, however money is still pretty high up there.
I come to Less Wrong because it is the only community whose advice I would trust. The rest of the internet as many scammers, most friends and family feel threatened by the idea of investment/new things etc. Also they just aren't as rational as Less Wrong.
I would be so appreciative of any advice given.
Also anyone in the same boat?