ETFs are typically index funds and do not generate as much in the way of taxable capital gains to pass on to investors as compared with actively managed funds. ETFs and mutual funds are becoming less distinct from each other, and investors need not own both types of investment. If you like the idea of buying and selling fund shares during (rather than at the end of) the trading day, ETFs are a good choice for you.
As a true beginner, I found this book rather frustrating. I liked that a minimal amount of time was spent on general investing advice, so that we could get right into stocks. At first I liked that this is a small book, 128 pages of content with a small page size and medium font, but soon realized that the information was packed too densely for me to be able to learn it. The bulk of the book is one equation on company statistics after another woven into a loose narrative. They said to follow along with the equations at home, but I would have needed more guidance than that, like a work book or at least some exercises. So the more I read, the more lost I got. I will, however, keep this as a reference book, as it has a good index, and I will be able to use it to look up terms and equations.
For instance, if you purchased an S&P 500 ETF, you are only buying one “thing”. However, that ETF owns stock of all 500 companies in the S&P, meaning you effectively own small pieces of all 500 companies. Your investment would grow, or decline, with the S&P, and you would earn dividends based on your share of the dividend payouts from all 500 companies.
If you want to turn a modest salary into a comfortable retirement income, you’ll likely have to invest in some way. Many employees get investing opportunities through their employers via a 401(k). If this is you, it’s important to take advantage of the educational resources your company offers. Aside from this, do your homework before investing your hard-earned money, and avoid plans that charge high fees. Check out our 401(k) calculator to see how your contributions can help you be ready for retirement.
Andrew: 00:50 Yeah, I love it. So maybe I’m recording this because this is something I need to tell myself more than anything else. Having people around and having them influence your life can do a lot of things for you. Very, very well. They say the five people closest to you are the most important because they impact how you live your life and the big, big way. So I, I kind of present this topic and this idea based on some personal context. I guess I didn’t mean to get like super personal, but there’s a saying that as you get close to the turn of a decade you start to make big moves, right? So we’re here close to the end of 2020 and that full decade before.
For example, depending on your age and risk tolerance, you might want to have some of your portfolio invested in bond funds, growth and income funds, and international funds. You may also want to consider high dividend stocks among your individual stock holdings. Income earning securities tend to be less volatile than pure growth stocks, particularly in bear markets. You’ll want to develop a balance between your growth assets, and your income- or growth and income-holdings.
Popular financial goals include buying a home, paying for your child’s college, amassing a “rainy day” emergency fund, and saving for retirement. Rather than having a general goal such as “own a home,” set a specific goal: “Save $63,000 for a down-payment on a $311,000 house.” (Most home loans require a down payment of between 20% and 25% of the purchase price in order to attract the most affordable interest rate.) 
When you elect to contribute to a 401(k), the money will go directly from your paycheck into the account without ever making it to your bank. Most 401(k) contributions are made pretax. Some 401(k)s today will place your funds by default in a target-date fund — more on those below — but you may have other choices. Here’s how to invest in your 401(k).
Buying at the best time. Once you know what to buy, don't run out and make a purchase immediately. "There's a reason Wall Street makes money consistently and the average investor doesn't," Seiden says. According to him, that's because Wall Street investors wait until the share price drops before making a purchase, while many new investors buy when prices are highest. The World's Worst Stock Investment Advice