November 4 - Investing Dilemma

      Today, my father and I attempted to start up my investing account with Vanguard.  We tried using the Vanguard Target Retirement 2045 Fund like Mr. Hallam suggested, but when we tried making it joint-operated under my name too, we couldn't because I am too young to be a part-owner. What my father is now proposing is that I just take over one of his small, current investments and once I'm 18 he will just give it to me.  This account currently has $161 already in it, and I wouldn't have to put in $1,000 to start a new one (no loan!).  The one problem with this mutual fund is that instead of a Vanguard Target Retirement 2045 Fund, it is a 500 Index Fund Admiral Shares fund. Do you know if there is a big difference between the two Mr. Hallam? Is this one perhaps more or less risky?

       I just had a look at Mr. Hallam's latest article, "Millionaire Teacher Invests $21,000 in U.S. Stock Index."  Here, Mr. Hallam gives us the low-down on why he did this.  It's quite simple really.  Mr. Hallam's portfolio is split like this: 41.3% Canadian bond index, 30.4% International stock index, and 28.3% US stock index.  As you can tell, his US stock index is falling a bit behind the others. However, this is purposeful.  Since Mr. Hallam is 42 years old, he has 42% of of his index invested in bonds (generally safer than stocks).  So the other 58% had to be evenly distributed between US and international stock indexes.  Mr. Hallam likes to skim off the index that is doing the best and add onto the index that is doing the worst, so that is probably why he invested $21,000 into his US stock index.  Mr. Hallam also talked about keeping low transaction costs.  I believe he means that he doesn't want to buy/sell his stocks to too often because he loses part of that money through transaction fees.

       Since for my new investment account I'm going to need to be investing US$500 annually, I need to start saving that money.  But how? As of right now, I'm sort of working two part time jobs.  I make $20 on Saturday reffing a SACAC soccer game, and I make $20 a day, two days a week working at a baseball clinic. So add that to my $50 allowance and I'll be earning $110 a week. I usually spend about $50 a week anyways, so lets say I have $60 to save up all year.  Sixty dollars a week will earn $240 a month, and $2,880 a year.  Even though this is in Singapore dollars, it is still far above $500, so I'll be set to invest every year.  It never hurts to invest a little more either!