Nội dung

Published by The Motley Fool, Inc., 123 North Pitt Street, Alexandria, Virginia, 22314, USA First Printing, February 2001 10 9 8 7 6 5 4 3 2 1 This publication contains the opinions and ideas of its authors and is designed to provide useful information in regard to the subject matter covered. It is sold with the understanding that the author and publisher are not engaged in rendering legal, financial, tax preparation, or other professional services. Laws vary from state to state, and if the reader requires expert assistance or legal advice, a competent professional should be consulted. Readers should not rely on this (or any other) publication for financial guidance, but should do their own homework and make their decisions. The author and publisher reserve the right to be stupid, wrong, or even foolish (with a small “f”). Remember, past results are not necessarily an indication of future performance. The author and publisher specifically disclaim any responsibility for any liability, loss, or risk, personal or otherwise, which is incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this book. Copyright © 2001 The Motley Fool, Inc. All rights reserved. The Motley Fool and the “Fool” logo are registered trademarks and “Fool” is a trademark of The Motley Fool, Inc. ISBN 1-892547-11-2 Printed in the United States of America Body set in Apollo MT 11.5/13.5. Questions set in Syntax Med 13/13.5. Titling set in ITC Veljovic. Without limiting the rights under copyright reserved above, no part of this publication may be reproduced or distributed in any form or by any means, or stored in a database or retrieval system, without the prior written permission of The Motley Fool, Inc. Distributed by Publishers Group West Cover design by Johnson Design Interior Design & Production by Pneuma Books: Complete Publisher’s Services; (for info visit www.pneumadesign.com/books/info.htm) Printed by United Book Press, Inc. The Motley Fool The Motley Fool’s mission is to educate, amuse, and enrich. Begun as a newsletter serving 60 readers in August 1994, the Fool now reaches millions of people every month as it plays host to a celebrated community of individuals dedicated to helping each other achieve financial security and independence. The Motley Fool’s products and services are available across a variety of media: on its website at Fool.com; via its four Simon & Schuster books, all New York Times bestsellers; through its premium products, including online seminars, self-published books, and Motley Fool Research; through its syndicated weekly newspaper column, currently carried by more than 200 newspapers around the U.S.; via its daily “Market Minutes” and weekly “Motley Fool Radio Show,” both joint ventures with Cox Radio that can be heard on more than 150 stations nationwide; and on America Online (keyword: Fool). The Fool’s international website can be found at www.Fool.co.uk and on America Online (keyword: FoolUK). Become a Fool! Join the millions of people who call themselves Fools and are taking control of their financial destinies. When you become a Fool youÕll get: ¥ Access to The Motley FoolÕs informative and acclaimed website, Fool.com • A wide variety of personal finance solutions and exciting investment ideas • Foolish product discount alerts • Answers to all of your questions about money Get started on your journey to financial independence today by registering at www.welcome.Fool.com! iii About the Author Selena Maranjian is a senior writer at The Motley Fool. She lives in New Hampshire with her two dogs. (Whoops! Scratch that — that’s every other writer.) Armed with a Wharton MBA and a Masters in Teaching from Brown University, one of Selena’s missions in life is to render the incomprehensible comprehensible. She writes the Fool’s nationally syndicated weekly newspaper feature and has also written Investment Clubs: How to Start and Run One the Motley Fool Way and co-written The Motley Fool Investment Tax Guide. iv Acknowledgments Few Foolish products are created alone. Foolishness is all about community — about people conversing and learning together, asking and answering questions, sharing opinions, and making each other laugh. Even though I have an MBA, most of what I know about investing and personal finance was learned in Fooldom. Most of what you’ll read in this book also comes from Fooldom, directly or indirectly. I’m grateful to the many community members of the Fool who spend time on our discussion boards, sharing their wisdom. I’m also indebted to my many Fool colleagues, from whom I’ve learned much. I hesitate to name any names, but when it comes to personal finance and tax issues, Roy Lewis and Dave Braze are the ones who’ve most often made me look smart. Much of this book’s car buying and home buying information, as well as the glossary, is drawn from the work of Bill Barker, Paul Maghielse, and David Wolpe. The colleagues who’ve taught me about investing are too numerous to name. Many Fools worked hard helping make this book a reality, heroically reading and reviewing every page and making it a much better work than it otherwise would have been. I thank them most sincerely: Brian Bauer, Reggie Santiago-Bobala, Alissa Territo, Robyn Gearey, and Debora Tidwell. Thanks to Alicia Abell as well, for her guidance as the book was shaped. v For my family, who made me who I am, and my Fool colleagues, who always make me look good. Table of Contents FOREWORD by David Gardner............................................................................vii i INTRODUCTION ..................................................................................................xi PART I — PERSONAL FINANCE ..........................................................................1 Chapter 1: Saving and Budgeting..........................................................................3 Chapter 2: Credit Cards and Debt ......................................................................13 Chapter 3: Insurance ..........................................................................................23 Chapter 4: Buying a Car ....................................................................................45 Chapter 5: Buying a Home ..................................................................................61 Chapter 6: Paying for College ............................................................................85 Chapter 7: Banking Foolishly ..............................................................................95 Chapter 8: Living Below Your Means ................................................................107 Chapter 9: Taxes ................................................................................................121 Chapter 10: Retirement ......................................................................................139 Chapter 11: Divesting — Giving to Charity ..........................................................151 Chapter 12: Death, Funerals and Estate Planning................................................161 PART II — INVESTING ......................................................................................175 Chapter 13: The Basics ........................................................................................177 Chapter 14: Wall Street’s Ways ..........................................................................209 Chapter 15: Understanding Stocks ....................................................................233 Chapter 16: Researching and Evaluating Companies ..........................................251 Chapter 17: Advanced Research Topics ..............................................................299 Chapter 18: Buying and Selling Stocks ..............................................................309 Chapter 19: Mutual Funds ..................................................................................321 Chapter 20: Managing Your Portfolio ................................................................335 Chapter 21: How Businesses and the Economy Work ........................................351 Chapter 22: Un-Foolish Investing ........................................................................361 Chapter 23: Potpourri..........................................................................................371 PART III — APPENDICES ..................................................................................387 Appendix A: Resources for More Information ....................................................389 Appendix B: Glossary ..........................................................................................393 Appendix C: Index ..............................................................................................403 vii Foreword by David Gardner Every year, The Motley Fool executes its own April Fool’s Day prank. We design each of the pranks in accordance with our public mission: to educate, to amuse, and to enrich. That means the jokes themselves must not only be funny, but must also teach people to make better financial decisions. Our 1998 joke provided a perfect example. On our home page at Fool.com, as evening blended into early morning on April 1, 1998, we put up a public apology, front and center. “We’ve been telling you for five years now that most mutual funds underperform the market averages,” it began. “We were wrong.” We were of course completely right. In case you didn’t already know, the vast majority (on the order of more than 80%) of managed stock mutual funds have in fact lost to the market’s average over the past five years! It’s one of the most damning statistics out there — that mutual funds managed rather expensively by humans do worse, after fees, than the stock market’s average performance each year. Given that you’re paying fees to a manager, do you not find it pretty shocking and disappointing to be paying someone to lose to the market for you? And not enough people know this, which is the educational purpose of our joke, once we came clean. Anyway, we claimed in this April Fool’s apology that we’d been wrong, wrong, wrong. You see, we had been misreading a graph, we said. For five years, we had been looking at a graph of these numbers that had, unbeknownst to us, been printed upside-down. So rather than 80% of all mutual funds losing to the market, our April Fool’s letter stated that 80% of mutual funds had actually beaten the market. And we had been telling all our customers to steer clear of managed mutual funds as a bad idea! Egg all over our faces. viii • The Motley Fool Money Guide Now if you’re not clear on what “stock mutual funds” are, or what “market averages” even means, these are irrelevant for the purpose of this Foreword. I’ll just say now that you’ve come to the right book; Selena is here to teach you. No, the singular aim of this Foreword is to get across to you that if you don’t “know it all,” you’re not alone! In fact, you might be surprised to learn of the company you keep… Later that day, April 1, 1998, a vice president of a regional brokerage firm in Charlotte, NC who also hosts a popular regular radio broadcast in that city dispensing financial advice — castigated The Motley Fool for being so wrong about mutual funds. We’ll call him “Fanny.” In 10 minutes of radio we will never forget, we listened to Fanny explain to his listeners how he knew we had always been wrong about mutual funds, that 80% of them had beaten the market, that we were completely wrong and that our apology wasn’t even enough. “If I had my way,” Fanny said in an emotionally charged address, “I’d put those guys up against a wall and shoot ‘em.” That’s right, a man who had risen to become VP at a regional brokerage firm and a daily radio personality dispensing financial advice to a large Southern city had actually fallen for our joke. He had actually believed that 80% of all mutual funds were beating the market! (He’d “known” we were wrong.) This Wise “expert” who held sway over the money management of many did not himself even realize how poorly managed mutual funds had performed. Given his career focus, you’d think he’d have had his eye on the ball, especially given his senior level. You’d think so, wouldn’t you? Without ever intending to actually bait professionals with our April Fool’s joke, we had snared a big shot who actually lacked a simple knowledge of one of the financial world’s most basic truths. In her introduction, Selena calls it a secret that most of us don’t know much about personal finance and investing. Guess what? She writes: “Most of your friends, relatives, neighbors, and colleagues probably feel the same way. Just as you’re pretending that your financial house is in order, so are they.” Foreword by David Gardner • ix In this handy, plainly worded, and humorous guide are many of the answers to questions most of us think everyone else but us already knows. Keep it nearby, go back to it as needed, and put these answers to work for you in your daily life. And don’t believe a word you read on our site on April first. But you’ll be surprised who does! — David Gardner To read the 1998 April Fool’s Joke visit: www.Fool.com/AprilFools98/ x • The Motley Fool Money Guide