Sunday, May 4, 2008

A Brash Cash Stash

Do you remember the Super Bowl ad with the baby talking about how easy it was to use E-Trade, and then spitting up? For me, that was the most powerful moment in television history. It convinced me to go blow $200 without having a clue what I was doing.

I've always been tempted by the stock market. Corporate America makes zillions of dollars off everyday schmucks like me. Maybe, if I play my cards right, I can own a piece of corporate America.

The problem is, I have no idea what my cards mean. They have funny acronyms on them, like “DJIA,” “NASDAQ,” and “SELL.” Who knows what on earth any of those things stand for?

But I refuse to let The Man keep me down. Instead, I'll do some research for a few minutes and pass along my findings.

Then you and I can be The Man, keeping other people down. It's the American Way.

Let's start with the basics. The “stock market” is a place where you can buy “shares” of certain corporations. In other words, you could own a tiny fraction of Sears, for example.

Keep that in mind the next time you visit Sears, if one of their employees – sorry, one of YOUR employees -- looks askance at you for swiping a knob off a washing machine, just stride up to that person and ask indignantly if they even know who you are.

“I could have you fired” should be the words you use to greet anyone who looks like they might try to sell you a lawnmower.

Anyway, financial advisors will tell you that the stock market is the most risky place to put your money, but it's also the only way to make any serious coin over the long haul.

If you're a baby-boomer and you would rather not risk losing your entire retirement savings right now, you could consider bonds.

Much is made of the the gigantic national debt, but few people realize that some of that debt is owed to ordinary Americans. Growing up in the '80s, I remember seeing those cheesy commercials for U. S. Savings Bonds. Little did I realize that my government was basically jonesing for a fix.

“Come on, man. I'll pay you back, you know I will.”

You can also get corporate bonds, which financial experts consider a bit less secure because corporations, unlike governments, can sometimes go belly-up.

I can't believe I just wrote that sentence.

Personally, I have a lot of my money in mutual funds. Here's how it works: You and a bunch of other hopeless drooling losers contribute a bunch of money to a giant “fund” that is carefully managed and invested by some jerk with a red BMW and a hands-free cell phone.

Because a true professional is deciding how to invest your money, your returns should be larger, perhaps even big enough to pay the fees charged by the true professional.

That's all I've figured out so far, but hopefully I've inspired you to take control of your finances, study the inner workings of capitalism, and then maybe spit up like that kid on TV.

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