Personal Investing: The Missing Manual

by Bonnie Biafore, Amy E. Buttell, Carol Fabbri

Overview

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

Product Details

ISBN-13:	9781449381783
Publisher:	O'Reilly Media, Incorporated
Publication date:	05/24/2010
Series:	Missing Manual Series
Pages:	236
Product dimensions:	5.90(w) x 8.90(h) x 0.60(d)

About the Author

Bonnie Biafore has always been a zealous planner, whether setting up software demos, cooking gourmet meals, or scheduling a vacation to test the waters of spontaneity. Ironically, fate, not planning, turned this obsession into a career as a project manager. When she isn't managing projects for clients, Bonnie writes about project management, small business accounting, personal finance, investing, and technology. She's also branching out into other "dry" topics with articles for the Wine Enthusiast. As an engineer, she's fascinated by how things work and how to make things work better. She has a knack for mincing dry subjects like accounting and project management into easy to understand morsels and then spices them to perfection with her warped sense of humor.



Bonnie is the award-winning author of more than a dozen books including Quicken 2009: The Missing Manual, QuickBooks 2009: The Missing Manual, Project 2007: The Missing Manual, the Better Investing Stock Selection Handbook (which won an APEX Award of Distinction), Online Investing Hacks, and On Time! On Track! On Target!. She also writes regularly about financial topics for Better Investing bankrate.com and interest.com. When unshackled from her computer, she hikes in the mountains, cycles, rehabilitates horses, cooks gourmet food, and, most importantly, tries saying no to additional work assignments.

Amy Buttell is a journalist who writes about personal finance, investing, healthcare and accounting. She got started writing about investing and personal finance when she realized she owned several mutual funds recommended by a broker and had no idea whether they were any good or what she needed. That event along with her insatiable curiosity landed her first assignment as mutual fund columnist for Better Investing magazine, a position she still holds today after nearly 10 years on the job.



She writes for Bankrate.com, Creditcards.com, the Journal of Financial Planning, AARP: The Magazine, The Investment Professional, and Cyberhomes.com. She is the author of The Better Investing Mutual Fund Handbook and contributed to the book, Online Investing Hacks. She lives in Erie, PA with her two sons and two cats in a house near Lake Erie

Carol Fabbri is driven to teach as many people about personal finance as she can.On any given day you'll find Carol writing, speaking, or presenting on the topic. She believes that the biggest roadblocks to making good investment decisions are emotional baggage regarding money and a lack of clarity in the industry—both of which can be improved with financial education.



By combining her background in management consulting and the finance education she gained at MIT Sloan, Fabbri replaces people's preconceived ideas about finance with knowledge, and breaks down the psychological barriers hindering good investment choices. She has helped thousands learn to manage their money.



Fabbri is the managing partner of Fair Advisors, an independent financial advisory firm. She is also launching the Fair Advisors Institute, a nonprofit dedicated to improving financial literacy in the US.



In 2009 she received the TIAW World of Difference award in recognition for her efforts to advance the economic empowerment of women. She is frequently quoted in national publications like The Wall Street Journal, Forbes, and Smart Money.Carol's other passions are her husband and her son. She used to have hobbies but then she became a mom.

Table of Contents

The Missing Credits vii

Introduction 1

Part 1 Prepare to Invest

Chapter 1 Why Should You Invest? 13

How Inflation Hurts 14

Why Scary Numbers Aren't That Scary 16

Chapter 2 Set Your Investment Goals 21

Building Your Bucket List 22

Retirement, College, or Other Goals 23

The Big Kahuna: Retirement 24

Other Long-Term Goals 33

Putting It All Together 36

Chapter 3 Invest with Open Eyes 39

Clean Up Your Finances 40

Spend Money Wisely 43

Expect Base Hits, Not Home Runs 44

Sidestepping Pitfalls in Investor Psychology 45

Part 2 Choose and Buy Your Investments

Chapter 4 How Investments Work 55

The Big Four: Typical Investments 56

Taxing Decisions 62

Chapter 5 Funds 71

The Vanilla, Chocolate, and Strawberry of Funds 72

What a Fund Invests In 76

Evaluating Fund Performance 85

Keeping a Lid on Fund Expenses 90

How to Pick Funds 92

Finding Funds 95

Deciding When to Sell 97

Managing Your Funds 99

Chapter 6 Stocks 103

Buying into a Business 104

Investing in Growth 108

Investing in Quality 111

Investing in Good Value 120

Watching for Trends 125

Chapter 7 Bonds 127

Why Invest in Bonds? 128

How Bonds Work and How You Use Them 129

Buying Bonds 138

Chapter 8 REITs 141

Is REIT Investing Right for Me? 142

Types of REITs 143

Picking Individual REITs 144

Finding the Right REITs and REIT Funds 149

Chapter 9 Manage Your Portfolio 153

What's Investment Portfolio Management? 154

Return vs. Risk 156

Asset Allocation 159

Choosing an Asset Allocation Plan 162

Asset Allocation Made Ridiculously Easy 166

Reviewing Your Portfolio 69

Rebalancing Your Portfolio 170

Getting Back On Track 172

Part 3 Manage Your Investments

Chapter 10 Investing for Retirement 175

The Key Retirement Decisions 176

Making the Most of Retirement Accounts 177

Managing a Retirement Portfolio 188

Making the Most of Social Security 191

Withdrawing Money During Retirement 194

Chapter 11 Investing for College 197

College Costs How Much? 198

Tax-Savvy Ways to Save for Education 199

How to Pick a 529 Savings Plan 204

Saving for More Than One Child 208

The Best Way to Spend College Savings 209

Chapter 12 Investing for Health Care 213

Types of Health Insurance 214

Choosing an Employer-Sponsored Plan 215

Choosing an Individual Health Insurance Plan 216

High-Deductible Health Insurance Plans 218

Negotiating with Health-Care Providers 224

Paying for Long-Term Care 226

Index 227