Lookout Mobile

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Heard an interview this morning on the radio from a fascinating group. The group's name is Lookout Mobile. It was founded by a Mobile transplant as a place for people to come together and interact with new interesting people in their own city.

A very neat idea that solves the age old question for people living someplace new.... How do I meet people? I recommend checking it out. Once registered you can post new events on the calendar that you would like others to attend, or you can sign up to attend current events posted by others. And the best part, it is absolutamente free!!

The Taming of the Roth

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A friend at work asked me to put some information together on the Roth IRA and taxable investment accounts, so I figured since I went to all of the trouble to write it up, I might as well share it with my adoring public.

1. We don't need no stinking retirement accounts: Ok, face the facts, Social Security will not be there for you. Regardless of what the politicians say, forget about it. Even if it is still around and maybe by some miracle is still able to cut you a check one day the realities are:
   
   • You will probably be 80 years old before you reach the new and improved retirement age if the government has its way
   
   
   • The amount you will receive will be a pretty tiny monthly check compared to what you put in
   
   
   • You will never get out the amount that you put in and that was put in on your behalf (remember that your employer was matching your Social Security contributions when you were working)
   
   


2. The textbook retirement plan approach: The book says that retirement plans should go like this (in this order too):
   
   • Employer sponsored 401(k) plan up to the company match - You really, really want to put in enough money to get the full company match. Remember the Employer's matching contributions are like free money. Don't you like free money? Or think of it this way, if you put in a dollar and they put in 50 cents match, you just made a 50% return on your investment. Try to do that consistently on Wall Street. Don't forget this is Pre-Tax money so it will lessen your taxable income, but you will have to pay taxes on the money when you withdraw it in retirement.
   
   
   • Roth IRA up to the yearly contribution limit - The limit for 2005 is $4,000.00. These are after tax contributions meaning you put in money that has already been taxed. Beauty of these babies is 1) the money in this account will never be taxed again, 2) You can always remove your original contributions without any penalty (Uncle Sam already got his tax money so he doesn't care), and 3) The contributions and any growth they achieve over the years will not be taxed when you start withdrawing money.
   
   
   • Back into the company 401(k) plan up to the yearly limit - the limit for 2005 is $14,000.00
   
   
   • If you still have money left over - then you place it in a taxable investment account......or give some over to me since you seem to have plenty to spare
   
   


3. How do I open a Roth - You must go through a third party company to open a Roth IRA account. The best companies to go through are those that only deal in No-Load Mutual Funds and those that charge extremely low expense ratios for those funds (Less than 1%). Here are some that I like along with their minimum requirements.
   
   The Vanguard Group (www.vanguard.com) - $1,000.00 minimum to open an account. Thereafter a minimum contribution size of $100 if contributing via check, exchange, or electronic bank transfer. The minimum for additional contributions through an Automatic Investment Plan (monthly debit of bank account) is $50. There is a $10 annual maintenance fee until your account gets over $5,000.00. A couple of nice funds are:
   
   VFINX Vanguard 500 Index Fund
   VTSMX Vanguard Total Stock Market Index Fund
   VGSTX Vanguard STAR Fund
   VWELX Vanguard Wellington Fund
   
   Fidelity Investments (www.fidelity.com) - Offers the SimpleStart IRA Account which has no minimum to open an account and no account maintenance fees. The only requirement is to set up a recurring contribution of at least $200.00 per month from your bank account. Very nice that there is no minimum to open an account. Some nice funds:
   
   FFNOX Fidelity Four-in-One Index Fund
   FFFFX Fidelity Freedom 2040 Fund
   
   TIAA-CREF (www.tiaacref.org) - No minimum and no account maintenance fee. The only requirement is to set up a recurring contribution of at least $50.00 per month from your bank account. Nice funds:
   
   TCEIX TIAA-CREF Equity Index
   


4. Taxable Investment Account - For those with just too much money lying around or that just want to play and get a feel for the market. Look for no account maintenance fees, low trading fees, automatic dividend reinvestment, and ability to purchase fractional shares. Here are some I like:
   
   Scottrade (www.scottrade.com) - $500 minimum to open an account. No account maintenance fees. $7.00 trades. No automatic dividend reinvestment. Only allows purchase of whole shares
   
   ShareBuilder (www.sharebuilder.com) - No account minimums or inactivity fees. $4 trades if done via an automatic investment plan. Able to purchase fractional shares. Automatic dividend reinvestment
   

Now I know that was a good bit to take in all at once. Maybe I'll break it down further later, but that is it for now. Hopefully my co-worker will be able to take this information and decide to join the elite group of those who Roth.

American Roulette

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Just finished reading a fascinating book called American Roulette : How I Turned the Odds Upside Down---My Wild Twenty-Five-Year Ride Ripping Off the World's Casinos. The book details Richard Marcus's 25 year career stealing from the casinos using slight of hand type moves with casino chips. Of course first and foremost, I would not advocate attempting anything you read in this book (that is if you enjoy the nice, fairly normal life of freedom you currently have).

I found out about this book one day from an online article that mentioned Richard's online weblog. Here he details various stories and thoughts on the gaming industry. What I read sounded fascinating so I had to pick up his book.

To buy the book I used Amazon.com's used book purchasing capability. It has worked great in the past for CD's so why wouldn't it work well for books.....

Well it worked great. I found the book cheap, it arrived in under a week and was in great condition...all the way down to the Baltimore Public Library sticker on the front of it. Surely this was purchased from the library and not just stolen, but who knows.

I was held hostage for 3 days while reading this book because it was so enthralling. I would highly recommend it. Of course if you are in Baltimore, you probably will not be able to find it at the local public library. Now that I have just finished it I can go back to the main task at hand. Finishing preparing for the Sun Certified Programmer Java 5 beta exam. I have less than 2 weeks left, so let the cramming commence.

It was nice to break away from reading the techie stuff for a bit since I rarely read anything that isn't technical or financially related.

Speaking of that, are you going to file your taxes online this year? No you say, why not? Did you know that many of the online tax preparation sites have made deals with the IRS to offer free federal filing online. You get your refund faster than mailing and there is no way your neglect in carrying the one can put you in hot water. Follow the links on the IRS site