Where would you store $2000 a month for a 15 year savings plan?

[fireplay]

I am a novice at savings and investments. Now I am finally at a secure place in my life where i can save $2000 a month. What should i do with it? How do i best make the money "work"? I am not looking for any high risk opportunities...i am looking for a 15 year solid savings plan. Thanks for your suggestions.

[DirtyDan]

I invest in stocks - large companies and many of which pay regular dividends. The dividends are nice because they're taxed at a lower rate than personal income and they can be reinvested into more stock.

If you're positive you don't need it for 15 years (no medical/housing/bereavement/katoey-operations) then simply put it into blue chip stocks. These will be the big ones on the market - energy (XOM), Banking, Telcom, Transportation, Commodities. Pick a dozen stocks and start buying. You could also cheat and use a mutual fund for large cap companies (maybe a little less risky having someone in the game pick your targets)

$2k/month after 15 years at a reasonable 8% return will turn your $360K investment into $675.2k (this does not discount for inflation). If you choose a mutual fund, the managers will take a percent every year knocking you down to $622.2k but might be worth it to mitigate risk of selecting your own individual stocks.

You also want to make sure you're putting this money into an institution / bank that is credible - not one of the random Singaporean numbers that keep calling asking to invest your money.

Keep in mind that during the next 15 years, the stock market may go up and down, (which is why you need to be sure you will not need to cash in the stocks - it hurts when the shares are worth less) but over any 15 year time-span your initial investment will recover.

Edited November 27, 2015 by DirtyDan

[Misty]

As you get started, suggest you read The Global Expatriate's Guide to Investing by Andrew Hallam The author, an international school teacher and personal financial journalist, wrote the book specifically for novice expat investors. It should help you get started, and warn you off some of the things that are really best avoided.

The Hallam book is specifically for novice expats so you might find it useful. But one of my favorite books on investing is The Investor's Manifesto: Preparing for Prosperity, Armageddon, and Everything in Between by William Bernstein. It's incredibly readable: short, concise and to the point.

Reading either or both of these would be time very well spent.

[fireplay]

@misty fantastic thanks for the reads list I will check these books out...and @dan... again this may seem super simple but are you saying I should use an American Bank to invest in the NYSE? Can i use a foriegn bank? Is there some sort or reccommendations regarding expats working with a mutual fund manager? I don't think I want a thai managing my money so how do i set up meetings with people to get into a mutual fund situation?

[DMC1]

I have a savings plan with AAM advisory, Singapore. I have a monthly scheme of $1000USD and a portfolio lump sum. If you are interested they will come over to meet with you & discuss the best plan for you. I won't give any more details on the public forum so you can PM for more details, if you are interested.

[technologybytes]

I think that if you choose to ask and take advice for a matter like this on a forum like this then there is little hope for you.

Get some professional advice from outside Thailand.

[fireplay]

So why do you say that huh? I see lots of advice being offered here and your negative comments aren't really useful or necessary are they?

[AyG]

fireplay

Without knowing your nationality, your country of residence, your intended retirement country, your current pension provisions, your age, and your reason for investing, it's impossible to give any meaningful advice.

[fireplay]

Thats solid Ayg...American...I live in Thailand...i have no idea where i want to retire...possibly Thailand but most likely not the USA.... I am 40 I have no pension provisions and my reason to invest is to make sure i can eat pay bills and feel comfortable when i become old man winter and invalid....

Edited November 27, 2015 by fireplay

[jackie45]

Take a look at Vanguard Mutual Funds. Google there reputation for integrity and for the lowest fees in the industry.

Vanguard has a very comprehensive website and its online investing site is straightforward.

I am a 70 year old American splitting my time between Malaysia & Oregon. I started a plan similar to yours at about 45

and it worked, notwithstanding the stock market went through some gut wrenching periods. Invest and hold for the long term.

Worked for me.

[3mike26]

Check this out and adjust, simplify, for your circumstances:

http://www.marketwatch.com/story/is-this-all-the-investing-advice-youll-ever-need-2015-07-31

best wishes

[nithisa78]

Sir, That's great news. However, on TV you're going to get a lot of answers....most will be subjective.

Suspect you are in Thailand. Your question doesn't provide enough specifics.

When you would PM I can refer you to a creditable source.Financial adviser. One whose references you can check and should check. That's the way its done.

Doubt you're in the position because of foolishness. I know what I'd do, but this isn't the forum to air it in.

Congratulations. Respect sir.

[AyG]

Thats solid Ayg...American...I live in Thailand...i have no idea where i want to retire...possibly Thailand but most likely not the USA.... I am 40 I have no pension provisions and my reason to invest is to make sure i can eat pay bills and feel comfortable when i become old man winter and invalid....

Really sorry to hear that you're an American. That really sucks. America is one of only two countries in the world that taxes its nationals on their worldwide income. (The other is Eritrea.) You should at least consider renouncing US citizenship if your unlikely to retire there.

The other implication of being an American is that you are basically restricted to US investments; overseas funds won't usually accept you as an investor.

Not being American, I can't really comment on the challenges of opening a brokerage account in the US whilst non-resident, though I understand it can be difficult. That's something you'll need to look into.

You also need to look into whether you're eligible for any tax-privileged accounts. I don't know the details, but I hear terms like Roth IRAs and 401(K) plans bandied about. Don't know if either is relevant to your situation.

On the plus side, you've got a decent amount of time to retirement, perhaps 25 years. That means you can reasonably take on higher risk investments, rather than stashing all your money in the bank or in bonds. In practice, that means buying equity mutual funds or ETFs.

Don't fall into the trap of just buying US stocks (via funds/ETFs). It's a common mistake to overweight one's investments to one's home country. There's no reason to think that US markets will outperform over any given time period. As well as the US, invest in Europe, Asia Pacific, Emerging Markets. This is particular relevant since you say you're unlikely to retire to the US.

Finally, you need to consider whether you're saving enough each month. If you save $2,000/month over 25 years you'll save $600,000. (That's ignoring both the effects of inflation and any growth in investment value, so is a conservative figure.) When you start drawing on your investments you can probably safely withdraw 4% each year, that's $24,000/year. That's not an enormous amount to live on, even in Thailand. And an unexpected accident or medical bill might severely dent your savings, so reducing potential future income. If you can increase your savings to $3,000/month you'll be in a rather more comfortable position.

[scorecard]

Another possibility is a savings / endowment / pension plan with Tokio Marine Insurance.

(TM is the biggest life company in Japan and well respected, and they operate across all of Asia. In Japan life companies and banks (and their overseas companies / agencies are under constant serious scrutiny by an appropriate Japanese government agency.)

They have a large office in Bangkok, also Chiang Mai and other regional centers.

No push of any sort, they have plenty of English speaking direct very professional staff who are trained to listen and advise the best plan for you rather than best commission.

If your in Chiang Mai I can give you the name of one of their senior staff, she speaks good English, quite knowledgeable but where needed she checks with HO to be sure. She came to our house maybe 6 or 7 times before we signed, no hassle or hurry up. Please PM to me if you want her name and mobile number.

For my own Thai family we have taken:

- A pension plan for my Thai son - all payments completed over 5 years then 30 year growth to 65 then an excellent guaranteed yearly payment kicks in. Final large payout at 90 years old, full benefits paid out if son dies before 65 or before 90.

- An endowment plan for my Thai daughter in law - all payments completed over 5 years then 10 year growth then a guaranteed excellent one time payout.

- Same for son's three kids. (And they have a pension plan to start little kids (not sure of minimum age but I guess 4 years old) started into a lifetime pension plan to kick in at 60 or 65 years old.)

Plus:

- My son gets a better rate for health insurance for whole family, with more options than usual.

- Discounted interest rate to borrow money from Tokio Marine.

- Personal Accident plans at a discounted rate.

- Discounts on car and house insurances.

Worth a look.

Edited November 27, 2015 by scorecard

[Shiver]

I don't know if our situations are similar or not, but because in my own case I'm a little under official retirement age at the moment, I have to put sweat equity (study of subjects, not work) as well as cash down in higher risk investments. If I get to the point where, if I understand you correctly, you want a reliable return rather than lottery style 'to the moon or bite the dust', then I would suggest (and I hate to say this, but if money is the goal then ....) I would suggest investigation of some Unethical stocks - by that I mean things like Lockheed Martin, British American Tobacco and others of that ilk. They seem to be more stable in good times and bad, whereas luxury product creators seem to swing with the economy, and I think a lot of us are expecting a rather large stock market correction, though we don't know when that will manifest. If it does take a hard hit in the future then you can always change your strategy to one that takes advantage of 'blood on the streets' for a future recovery.

One other thing that came to mind was Richard Branson many years ago created a FTSE (a UK index) investment programme, where he claimed that just investing directly, buy and hold, out performed more than 90% of fund managers (bear in mind that they take their commission first before you see anything), so the short answer for what it's worth I would say Unethical and do it yourself rather than men in suits telling you that 7-Eleven sales of Mama noodles always work. Oh, and be diverse in your choices for better stability.

[BuaBS]

Put some money in something real and tangeble : PM's : GOLD & SILVER , maybe some platinum & palladium. Yes they are manipulated but so are all other assets. Paper is worthless , paper burns , stocks & bonds are zero's & ones in some bankers or brokers computers. You can hold your Gold & Silver in your hands. Numbers on a computerscreen can vanish in microseconds. IRAs and 401(K) will be looted by your government.

[Ks45672]

Put some money in something real and tangeble : PM's : GOLD & SILVER , maybe some platinum & palladium. Yes they are manipulated but so are all other assets. Paper is worthless , paper burns , stocks & bonds are zero's & ones in some bankers or brokers computers. You can hold your Gold & Silver in your hands. Numbers on a computerscreen can vanish in microseconds. IRAs and 401(K) will be looted by your government.

Gold is nice, but I wouldn't ignore everything else just because it isn't "tangible"

Gold has its own strengths and weaknesses and also a lot of people think they have gold in some vault somewhere because they have a piece of paper but if everyone tried to withdraw their gold the whole charade will likely collapse....

[bluebluewater]

I would also suggest the Vanguard funds. Put them into a Roth IRA or whatever tax deferred or (better yet!) tax free account that best suits your situation. They have a whole "family" of funds but you don't need them all. Three or four will give you what you need - low cost, low risk, and great diversification including international exposure if you feel like you want that too.

[chilli42]

You have been given some good advice by people here so I won't repeat it. There are three things I would leave you with though:

1. If it sounds to good to be true, it is too good to be true - you are being set up for a scam/rip off

2. Assuming common stock of solid companies is what you buy, don't sell regardless of the price is up or down. The prices in the stock market are manipulated by big players who make money on stock movements up or down. Small players, like yourself, is where they make their money. If you have chosen the right companies stick with them.

3. One stock newsletter that I have found most useful is Motley Fool. Its not that they don't have products they want to market to you. They do and they can be expensive. However, the basic service they provide is as good as it gets and its free.

[Shiver]

Some good advice above about Precious Metals imho. One part of my game is to ride BTC and switch to GLD (physical) if it looks a bit toppy, then rinse and repeat - there are companies now that can facilitate that in multiple continents (including Asia - I think Singapore would be our nearest) where you can collect yourself in person if you want to (they keep more than 100% physical reserve to assure delivery capability). I have a modest business to put bread and water on the table, so can be unemotional about higher risk investment choices.

Also, one thing we're lucky to have in Thailand is that you can have a physical bar of gold if you want to - not all countries allow that, and a 1Kg bar is much like the size of a smartphone, so easy to store, even if you can't cross borders with it. I'd call it preservation of wealth rather than an investment though. It looks on historical data that it is capable of negating inflation, but doesn't actually grow (if you average the swings in the market that is).

Edited November 27, 2015 by Shiver

[DirtyDan]

Enevitably the gold golems emerge from their bridges talking about their "prescious" shiny coins... Gold has never paid a dividend. Gold is cyclical - buy low, sell high - it's a gamble because every year you hold it, you're losing out on what you could've made if you invested elsewhere (the opportunity cost). If you're at the point in your portfolio you need a hedge, then buy a bond, at least it keeps up with the price of inflation.

As stated, the whole Kennedy inspired global taxation for Americans things throws a monkey-wrench into any "offshore tax havens". As long as you have the American passport, you'll pay American tax. Open up any foreign bank account you now need to declare it on your taxes - there's a form (FUBAR or something they made me file out when I filed American taxes) Perhaps you can offset it with their reirement plans (IRA? 401K?) .

It won't cost you anything to sit down and discuss this with a financial expert. Look for someone with proper designations (Certified Financial Planner - CFP) and get their input. It's your future and not worth gambling away from poor advice.

And congratulations on saving for retirement. My brother (a CFP) tells me stories all the time about 60+ year olds ready to retire but THEY HAVE A MORTGAGE AND NO SAVINGS. Uhmm... you can't retire if you have no money.

[seancbk]

I don't know if our situations are similar or not, but because in my own case I'm a little under official retirement age at the moment, I have to put sweat equity (study of subjects, not work) as well as cash down in higher risk investments. If I get to the point where, if I understand you correctly, you want a reliable return rather than lottery style 'to the moon or bite the dust', then I would suggest (and I hate to say this, but if money is the goal then ....) I would suggest investigation of some Unethical stocks - by that I mean things like Lockheed Martin, British American Tobacco and others of that ilk.

If I was looking to invest I'd definitely go with the most evil corporations I could find.

I would also look at Energy Storage Systems, Robotics and Atmospheric Water Generators.

[seedy]

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[GOLDBUGGY]

If you are uncomfortable with the Stock Market, then a Mutual Fund is better for you. They diversify more than you can, thus less risk, but generally less reward to.

Choosing the best Mutual Fund for you is the most important. Many deal with stocks and bonds, which gives you added protection. Many deal with high yielding Dividend Stocks and Funds, which can be reinvested. But there are also many of them that just deal with stocks, oil, or gold funds which can be risky as well. I would choose for you a Mutual Funds which holds bank, utilities, bonds, and premium stocks from Blue Chip Companies.

The last thing you want to do is leave it in the bank.,You are better off buying the bank stock and gaining dividends then a savings account. .

[bbabythai]

http://www.thaivisa.com/forum/topic/825815-invest-in-facebook-shares-now-and-double-your-money-in-1-to-2-yrs/

[MANFROMBOCA]

Take a look at Vanguard Mutual Funds. Google there reputation for integrity and for the lowest fees in the industry.

Vanguard has a very comprehensive website and its online investing site is straightforward.

I am a 70 year old American splitting my time between Malaysia & Oregon. I started a plan similar to yours at about 45

and it worked, notwithstanding the stock market went through some gut wrenching periods. Invest and hold for the long term.

Worked for me.

i have accounts with vanguard and its a great company with great funds but recently they have blocked thailand from accessing thier website you will need a vpn if you want to use their site,,,but just as good is schwab www.schwab.com and i suggest using ETF funds they are like mutaul funds but have less costs involved, also with a schwab account you can send funds here with a phone call and their atm cards have no fees for international transfers

heres a link with some investment advice study the other links and as the above poster said buy and hold and you should be fine

http://www.schwab.com/public/schwab/investing/retirement_and_planning/retirement_income/portfolio_allocation

[a10ams]

Study the classic car market closely. Borrow 300k from the bank and buy two or three cars, For example .... 308/328 Ferrari, E-type Jaguar, Porsche 993 Turbo etc. Pay the bank back the $2000 a month you would save and watch these three cars outstrip any other investment.

[bazza40]

Study the classic car market closely. Borrow 300k from the bank and buy two or three cars, For example .... 308/328 Ferrari, E-type Jaguar, Porsche 993 Turbo etc. Pay the bank back the $2000 a month you would save and watch these three cars outstrip any other investment.

While I don't disagree classic cars usually increase in value, the risks are not stated.

1/ Risk of buying a lemon classic.

2/ Risk of lack of diversification.

3/ Risk of the bank calling in the loan with no notice. Yes, it has happened.

[brd]

fireplay.

You are lucky to be able to benefit from investing for yourself on a monthly basis to average down and long term, allowing you to be outperforming 85 % of all the fund managers.

In spite of political turmoil Thailand Index SET the past decades had performed extremely well ( +18 % a year in average ) because the Thai economy ignored the demonstrations.

Opening up on AEC 2015 to trade with 9 other partners plus a new Government redressing past errors, omissions etc....Thailand has a great potential.

Therefore look for Thai Military Bank TMB SET 50 fund at very low cost outperforming the Index you should not have any hesitation to join in.

I am a professional Investor and I am recommending index fund prior anything else.

If you do not like Thailand go for USA then.

Kind regards

[SinCityGr8One]

Gold (AU) and nothing BUT Gold (Au). Physical Gold in you hand. ..925% or 965% or .999% It has value for 5,000+ Years and will have value for another 5,000+ Years. Me and 5 Kg's. of 96.42% Dore Gold in my hands. Yeah, it's Gold and ONLY Gold. IMHO!