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naturegirl321 · Joined: 04 May 2003 Posts: 9041 Location: home sweet home

Seeing the little amount of money that I make here and that visiting my parents is more than a month salary, I'd like to do something to increase my earnings.
Stocks seems like the ideal way to do it, however, I'm clueless about them. If I wanted to start out , how much money would I need? And what kind of portfolios are good?
Any other info would be greatly appreciated!

moot point · Joined: 22 Feb 2005 Posts: 441

Look into tax-free offshore funds. Most international banks offer this service. Google "Jersey offshore funds" and you're bound to come up with a number of big banks and/or investment houses to guide you along.

moot point · Joined: 22 Feb 2005 Posts: 441

Just a follow-up. When I was first looking to invest I searched intensively over the Internet for advice. I found a very good source to be CNN Money's site. They gave an easy to understand summary of the different options out there. It is worth a look.

tedkarma · Posted: Fri Mar 03, 2006 12:57 pm Post subject:

Unfortunately - you really can't rely on stocks to give you RELIABLE income. The value of your portfolio can go DOWN as well as up.

My experience has been that real estate delivers more reliable income than anything else. The stock market can dump - but your tenants still need a place to live - and still pay rent. That's income.

JZer · Joined: 16 Jan 2005 Posts: 3898 Location: Pittsburgh

naturegirl321,

i think that if you really want to prepare for a long life in Peru, you really need to move to Saudi Arabia or somewhere to save some money and invest. Then you will be able to move back to South America and live a comfortable life style.

Justin Trullinger · Posted: Sat Mar 04, 2006 3:20 pm Post subject:

I have a philosophical problem with stock market investing, but spent a little time in a peripheral field at one point...

Ted Karma has an important point- any expert would recommend that a part of your investment portfolio be in real estate. And this will always be the most stable part. Real estate has a way of providing income, and increasing in real equity, that nothing else can match.

If you're planning to stay in South America, I doubt that your income will really allow for investing in real estate "back home." I'd look into your options, as a foreigner, to purchase property in Peru. You may be surprised how low the costs are if you get into less developed areas- and the less developed areas of today are the developing areas of next year. So to get value for money, you're going to need to do SERIOUS research. Try to find places where there is a predictable increase in value, and think of your investment in two forms of income: 1) The rent a property may/will bring you, and 2)The increase in value in the property itself.

The stock market is harder. Again, do good research and talk to people with experience. Remember that in the current climate, literally thousands of people have lost their shirts, and their pensions, over sudden market changes. Margin funds, or diversified mutual funds, tend to be amongst your most stable options, but even they offer no guarantees, especially over the short term. The idea of stocks offering anything except a way to SPEND money in the immediate future is slight. They can offer better prospects in the medium to long term future, but you'll have to have some substantial sums to invest, be patient, do good planning, and DIVERSIFY.

On my salary, it wouldn't be worth the effort. Maybe I'll by a nice retirement finca somewhere in the jungle...

Justin

naturegirl321 · Joined: 04 May 2003 Posts: 9041 Location: home sweet home

Delahoya · Joined: 16 Feb 2006 Posts: 34

Property is more stable for INCOME if you invest in cashflow positive properties. There is many ways you can go about this (and far too long to answer here).

Stock wise you can write options over shares that you own for a reliable income too. PM me if you want.... Smile

Mchristophermsw · Joined: 14 Apr 2005 Posts: 228

Nature girl,

I agree with Ted, property rentals are a steady income but also be prepared to be a landlord. That can take work but be well worth it or you can pay someone else to manage the property for you.

I took the time to cut and past for you some information that I think is very reliable and get you started. Let me know if this helps.

Personal Finance Basics (as adapted from Anthony Robbins, "Getting the Edge").

1) Limiting Belief.

Limiting belief is the number one reason why people do not become Financially Healthy. One must first believe that regardless of what they have left over to invest, they can make their dreams come true. The reality is that most people do not ever start because they think they do not have enough to save. Attitude is everything! So Start Today!

2) Compounding

This is the magic bullet of making money. Over time, consistant saving and investing will generate more money than most people could ever make working through the principal of compounding. This is a concept for those who are in it for the long run.

3) Invest

Let your money grow for you. Invest your money into

1) stocks = Growth with Critical Mass

a) Long term
b) Reinvest your principal
c) Asset Allocation

Over the long term, stocks have historically over time been the best investment to make. For instance those who kept there money into the stock market in both the Great Depression and in 1987 made money! Those who took their money out lost big time.

4) Asset Allocation is a must.

Anthony Robbins uses a 3 bucket Method he learned from John Templeton.

Bucket number 1. Security Bucket.

This is were you put a percentage of your money in low risk, long term and fixed income investments. Investments by nature that are very secure.

Bucket number 2. Growth Bucket.

This is the bucket were you put a percentage of your money in more aggressive investments. Aggressive growth mutual funds, individual stocks etc.
More risk, more growth. Also more of the risk.

Bucket number 3 is your dream bucket.

This is were you take 1/3 of your profits from your secure and growth buckets and put it into your dream bucket.

* Also reinvest the other 1/3 back into bucket number 1 and 1/3 in bucket number 2. Remeber asset allocation and compounding may sound real boring but it produce a winning combination!

The average consevative ratio is 70/30. 70 percent of saving into bucket number 1 and 30 percent in bucket number 2.

* Consistency and Patience are truly the virtues here!

Key points:
* Pay yourself first a specific percentage
* Be in it for the long term
* Be consistant
* Allocate your Assets
* While boring, and though it may seem your investments/savings are growing
at the speed of grass, over the years you will see the magic of 'Compounding!

tedkarma · Posted: Mon Mar 13, 2006 10:36 am Post subject:

I would recommend that you NEVER try to manage property yourself - and particularly from overseas.

See: http://tefldaddy.com/Manage_Real_Estate_from_Overseas.htm

JZer · Joined: 16 Jan 2005 Posts: 3898 Location: Pittsburgh

tedkarma,

I enjoyed your website. How about a follow up site on how to purchase your first property while liviing abroad? I would like to purchase a property but it seems difficult when I am living in Korea. So far I have just been investing in mutal funds and stocks.

Another idea for people looking to invest would be to invest in REITS. they are companies that invest in real estate. Also in America they are required by law to pay 90 percent of profits back to the investors. So you can invest in real estate without having to do any of the dirty work.

tedkarma · Posted: Mon Mar 13, 2006 3:57 pm Post subject:

If you are looking to buy a property - you need to go home on vacation and LOOK at it - to really know if you want to buy it.

Buying a property for investment needs to be divorced from emotion - but you still need to see where your money is going and meet the people doing the deal. It is too much money to trust that all is going to go well without personal contact.

That said - most people do CONTRACT to buy properties pending their inspection. So, yes, you can search and find something - make an offer and have it accepted all while overseas - but all pending your personal inspection in X number of days when you go there.

The inspection clauses are usually so general that you can reject it - should you find something you don't like - for any or NO reason at all.

avolkiteshvara · Joined: 15 Feb 2006 Posts: 33 Location: Seattle US

JZer · Joined: 16 Jan 2005 Posts: 3898 Location: Pittsburgh

tedkarma · Posted: Tue Mar 14, 2006 12:09 pm Post subject:

You don't have to be there to close the deal - leave a power of attorney with someone you trust. But - if you are spending US$100,000+++ for something - it is probably wise to put your eyes on it before you send your money away.

Part of being a successful expat is to find ways to get things done from overseas - it's more than half the battle.

My guess is that you will need to have a sizeable chunk of cash in the deal before anyone will loan you money - because you are working overseas. Unless, of course, you already have a property against which to lien the money you borrow.