'Investing should be as exciting as watching paint dry'
We're all trying to make the most of our money in these tough economic times.
The most important thing to remember is to keep it simple.
Interest rates are down, the stock market isn't going anywhere quickly and real estate isn't the investment it used to be.
But you want to make some money in this down economy, so what's the smart thing to do?
Jane Bryant Quinn is one this country's top experts on personal finance. In her latest book is "Making the Most of Your Money Now," she
gives this message: ignore most of the advice you see or hear about investing and money management.
"You do not need 95 percent of it. Ninety five percent of it cost too much; commissions are high. It's keeping brokers going. It's keeping insurance agents going. It will make them rich; it will not make you rich.
"The number one thing I say to everybody is that the simplest things are the best things. If something is complicated, it's going to have more fees than you realize you're paying, and it will not deliver the kind of returns that they say it will," she said.
So, what does Quinn mean, exactly, by the simple things?
"So the simple things are: when you buy a house, get a simple 30-year mortgage. Keep your credit card clean; pay at the end of the month. In investing, use index mutual funds.
"An index mutual fund follows the market as a whole. Everybody tries to find a mutual fund that will beat the market, because there's some wonderful manager and he's going to beat the market. There's not one. There's not a single mutual fund that has outperformed the market over the period of time that you and I are investing for retirement - not one! That means when you're buying these mutual funds, you are leaving money on the table," she said.
Quinn says buying individual stocks is a waste of time.
"People do not know how to analyze the company. I don't know. You don't know. It's impossible!" she said. "Look at all of the widows and orphans who bought all the big-bank stocks. And now they're just destroyed as a result of the panic of 2008, 2009.
"Microsoft - in January of 2000, it was a terrific company, but it was a terrible stock. People do not know what is going on inside a company. We cannot know. So when you try to pick individual stocks, the odds are, once again, maybe you'll have a winner, but you'll have losers. So for fun, I say go to the race track. For investing, keep it simple. Investing should be as exciting as watching paint dry," said Quinn.
There you have it -- boring can be the key to smart investing.
The most important thing to remember is to keep it simple.
Interest rates are down, the stock market isn't going anywhere quickly and real estate isn't the investment it used to be.
But you want to make some money in this down economy, so what's the smart thing to do?
Jane Bryant Quinn is one this country's top experts on personal finance. In her latest book is "Making the Most of Your Money Now," she
gives this message: ignore most of the advice you see or hear about investing and money management.
"You do not need 95 percent of it. Ninety five percent of it cost too much; commissions are high. It's keeping brokers going. It's keeping insurance agents going. It will make them rich; it will not make you rich.
"The number one thing I say to everybody is that the simplest things are the best things. If something is complicated, it's going to have more fees than you realize you're paying, and it will not deliver the kind of returns that they say it will," she said.
So, what does Quinn mean, exactly, by the simple things?
"So the simple things are: when you buy a house, get a simple 30-year mortgage. Keep your credit card clean; pay at the end of the month. In investing, use index mutual funds.
"An index mutual fund follows the market as a whole. Everybody tries to find a mutual fund that will beat the market, because there's some wonderful manager and he's going to beat the market. There's not one. There's not a single mutual fund that has outperformed the market over the period of time that you and I are investing for retirement - not one! That means when you're buying these mutual funds, you are leaving money on the table," she said.
Quinn says buying individual stocks is a waste of time.
"People do not know how to analyze the company. I don't know. You don't know. It's impossible!" she said. "Look at all of the widows and orphans who bought all the big-bank stocks. And now they're just destroyed as a result of the panic of 2008, 2009.
"Microsoft - in January of 2000, it was a terrific company, but it was a terrible stock. People do not know what is going on inside a company. We cannot know. So when you try to pick individual stocks, the odds are, once again, maybe you'll have a winner, but you'll have losers. So for fun, I say go to the race track. For investing, keep it simple. Investing should be as exciting as watching paint dry," said Quinn.
There you have it -- boring can be the key to smart investing.