Financial Advice for my Son (and JPL/CIT Employees)

T. Chester

Update Log

Table Of Contents

The Three Most Important Precepts
  • The Power of Interest
  • The Importance of Savings
  • There Aren't Any Get Rich Quick Schemes
  • Things To Do Before Investing

  • Health Insurance
  • Disability Insurance
  • Life Insurance
  • Credit Card Interest
  • Cash Cushion
  • Home Ownership
  • Tax-Sheltered Benefits
  • Investing

  • The Efficiency of the Market
  • Risk
    Definition of Risk
    Return and Risk
  • Investing Time Horizon
  • Tax-Deferred Investments
  • Historical Return and Risk of Various Investments
  • Other Tidbits
    Traders are Losers
    Dollar-Cost Averaging
    Never Commit Your Money to a Risky Investment at Once
    Personal Acceptance of Risk
  • Mutual Funds and Individual Stocks

    Mutual Fund Selection
    Penny Stocks


    Junk bonds
  • Speculative Bubbles

    Example of a simple asset allocation

    Slightly more complicated asset allocation

    Real Estate and Collectibles


    NOTE: This document is still under construction. It has just been converted from Wordstar 3.3(!), and needs to be fully put into html. Sorry for the appearance of the tables. I'll fix them when I get around to it. I'll fix the equations as soon as browsers can read the html 3.0 standard! Also, the glossary is not yet present, but if you wish to email me any word you want defined, I'll start adding words to it and email you the definition.

    DISCLAIMER: This document was written for my son, and I threw in some specific information for JPL/CIT employees on the investment options available to them. I take no responsibility or liability for anyone following this advice.

    I apologize for putting in such a stupid statement as the above disclaimer. It was only necessary due to the incredible mess that lawyers have gotten our society into. I'll be posting some specifics on how (some) lawyers make us all poorer and how (some) lawyers have made our society a significantly worse place in which to live, in their quest to make a dollar.

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    Table of Contents for entire Financial Advice pages

    Copyright © 1989, 1996, 1997 by Tom Chester.
    Permission is freely granted to reproduce any or all of this page as long as credit is given to me at this source:
    Comments and feedback: Tom Chester
    Last update: 12 May 1997.