Who is the best place to invest in with?? My State Farm agent talked to me about them and its something I should do, but I’m not sure if I should go through them or not?

 

  • Common Sense 7:57 am on March 12, 2010 Permalink

    There are places you can buy "loaded" funds from that will have better funds available than "State Farm". You’ll pay around $57.50 for every $1,000.00 you invest.

    If you want to pay such a high ridiculous rate go to a good brokerage like Edward Jones, Inc. Buying from banks or insurance companies almost guarantees mediocre funds. it usually guarantees less expertise (as good as your rep may appear).

    If you want good mutual funds with no sales charge…. check out the following;
    T. Rowe Price
    Vanguard
    Dodge & Cox

    All you’ll need is a good "asset allocation". You’ll find great suggestions in almost any book on Mutual Funds. There are also places on the web.

  • zornundox 7:57 am on March 12, 2010 Permalink

    You want to look at the funds that many of the big places offer. One thing to really keep in mind when shopping for funds, besides how well or poor a fund may perform, are its investment expenses. Investment expenses can destroy a fund’s return if the expenses are too high. Your agent probably wants you to invest through him/her. S/he probably gets a commission on any funds that you purchase. I would avoid this at all costs, because the agent is only doing him/herself a favor and not you. Go research a few places like Vanguard, T Rowe Price, Fidelity, and etc. Most places will let you start investing online.

  • KNight31 7:57 am on March 12, 2010 Permalink

    If you want to purchase mutual funds open an account with T Rowe Price or Vanguard. They have no load funds. They also have low expensive. State farm will sell you funds that are load, which means you will be paying the person who sells you the funds commissions. This will lower the amount you could get from your dividends and if you decide to sell it in 90 days or less you will be charge extra. If you don’t have an Roth IRA account open one of the above companies and then you can start openning how many mutual funds you would like.

    I have 3 mutual funds with T Rowe Price. One is moderate risk global fund ( you should invest oversea or globally). Second one is high risk domestic fund (the higher the risk the more money you can make, but could lose too) and the third one is a moderate risk domestic fund. Both company offer great mutual funds. The difference is that vanguard’s mutual funds has lower expensive than T Rowe Price’s funds, but I like the way TRP website is setup and is well organize compare to Vaguard’s website.

    Don’t buy any mutual funds from insurance companies or banks you are not going to make as much money as should be making. I had my IRA account with my Bank and my investor for one year was making 5% commission every time i bought shares from the mutual funds (the shares were for $11.75 but I was getting them for $12.34 per share because it included his 5%). I was also paying the 0.98% the mutual fund charges for running it. Now I’m only paying the price of what the each share costs and the percentage of running the fund. Make sure you read the prospectus for each fund you will invest in and see how much they charge for running the fund.

    You may want to read Mutual Funds for dummies its a great book. I learned a lot about mutual funds. If you are interested in other type of investments also get Investments for dummies.

  • A nobody 7:57 am on March 12, 2010 Permalink

    You’re agent is absolutely right about you getting in to mutual funds, and you should look into other sources

    Mutual Fund companies have an entire array of products many will fit your needs.
    You can go to the MSN.Money website it has an entire section on mutual funds. Read about the various funds and in doing so you will be getting investment ideas and at the same time educating yourself about investing.

    You could also contact the funds companies for more information. I have found that Vanguard & Fidelity can meet your needs. The service and information they provide is all free and you will find it helpful. And remember, keeping you money in a bank or bank product is not investing.

  • Don 7:57 am on March 12, 2010 Permalink

    About 75% of all mutual funds under perform the market. All of them have management fees and some have sales loads. In my opinion, there are much better investment options than mutual funds.

    You might consider ETF’s, which are basically the same things as mutual funds, except they are on average, lower in costs.

    My favorite investment is a DRIP Plan.

    They are seldom recommended by brokers due to the low rate of commissions received. However, these
    reinvestment plans can be very powerful long-term investments. Studies have shown that DRIP’s are one of
    the best strategies on Wall Street.

    They are inexpensive and easy to start. New investors to the stock market should definitely consider a DRIP Plan.

    Companies like Toyota, Royal Canadian Bank, Sony, Bank of America, General Electric and many other Blue Chip
    Stocks can be purchased through your DRIP Plan, with as little as 1 share in most cases.

    These long-term plans are great for beginners as well as veterans. Check them out.

    Best of Luck