BRUCE WILLIAMS' 'SMART MONEY:' 401(k) good way to start investing
DEAR BRUCE: Is it better to start a 401(k) or a private fund? My spouse and I have been trying to figure this out before we run into mistakes. — J.B.
DEAR J.B.: There is no specific answer to one being better than the other, but a 401(k) is certainly a good way to begin. The 401(k) has tax advantages and gives you flexibility in terms of investment, which can work to your advantage.
I am not sure what you mean by “a private fund.”
If you mean investing in a fund owned by a private company, I have no problem with that. It will depend on your age and what your goals are.
There is no reason to limit yourself to one or the other. If you are trying to make a small start in investing, a 401(k) is a decent way to begin.
DEAR BRUCE: I have been thinking about stocks lately. I’m trying to do as much research and ask as many questions as possible. My question to you is how much or how little of a share can you purchase? I don’t have much money at this time, but would like to give it a try. — Dawn
DEAR DAWN: You ask a good question. Starting out with even a small amount of money can be advantageous. The fact that you can’t put much money into the market doesn’t stop you from reading a good deal and tracking some stocks to see how your choices would have been.
There are some shares that you can purchase one at a time. The first thing to do is to determine what you are going to purchase. I would suggest that you pick one or more areas, such as the drug stocks, automobiles, etc., concentrate on them and read as much as you can about them. You will be surprised how things will start to come together. Don’t be discouraged that it seems confusing at the beginning. Just continue to research.