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The standard advice that is recommended for windfall recipients is to stash it in a savings account and sit on it for 3 months. The goal is to avoid making any rash decisions based on euphoria.

You can use that time to read some books on wealth management. Two classics are The Four Pillars of Investing and The Bogleheads' Guide to Investing:

It is also a good idea to not tell anyone, unless you want to be bombarded by requests from family and friends for loans, invitations to invest in weird ideas/schemes, and so forth.

hikarudo · 2018-06-20 · Original thread
This other book by Bernstein is also good: "The four pillars of investing"
Start by reading

Your intuition is correct. Holding your employers stock means that if your employer implodes not only do you lose your job you lose a nice chunk of your savings.

Money is fungible. Your vested stock is just the amount of money it's worth today. If you wouldn't go out and buy that much of the stock today then you shouldn't hold it. You should sell it and go buy the thing you would have bought with that money instead. Don't be anchored by the wrong thing.

In my case I strongly prefer diversification and reducing tail risk over potentially more lucrative outcomes that I might get from having concentrated holdings in successful companies.

I would like to say I sell the stock as soon as it vests, and that is my goal, but I've been misbehaving and had a limit order open for 6 months. I really shouldn't do that considering the risk and upside are not at all proportionate.

RE financial advisers:

The #1 rule of financial advice is never take financial advice from someone who takes a percentage of your investments. Anyone who charges based on AUM is only interested in soaking you for fees with expensive investments that give them kickbacks.

You want a fee based adviser if you want one at all. I don't think you do if you are in the accrual stage. Just invest passively in the entire market of things you can cheaply invest in using index funds with a low expense and pick a ratio of stocks to bonds that you are comfortable with and let it grow. The most important skill is staying the course, staying in the market, and purchasing regularly (don't time).

I only own one fund.

It's a wrapper around several other index funds. Simple. I don't have to think about rebalancing or anything else. I'm going to keep buying this fund until I am in my 50s or 60s and have to rethink as my time horizon shortens. When this fund is not available such as my 401k I mimic it's allocation using the available index funds.

I used to try and do it cheaper by buying the underlying funds with lower expense ratios. Gaming taxable vs tax deferred. I lost interest.

markdog12 · 2016-07-13 · Original thread
This is a great book, Four Pillars of Investing -
This is my opinion as well. It's possible for more agile traders to consistently make money year after year. It's just fraught and you won't know until after the fact whether you have what it takes. You could also do well for a very long time and then lose those gains.

People tend to trumpet their winnings and not their losses and a shocking number of people don't actually know their rate of return.

I recommend Four Pillars of Investing by William Bernstein ( It has a lot of overlap with Malkiel's book and I recommend both of them.

Until you have read at least one of them I recommend you not start investing. The Intelligent Investor is a little optimistic and in later editions even Benjamin Graham admits that maybe active investing is not the greatest idea for most people.

My first reaction is to flag and leave a snarky comment. Instead I'm going to comment and upvote.

This is terrible advice on investing and not a starting point. Hold cash? Wait for the right time? Give me a break. And then they recommend you invest with them!

I recommend The Four Pillars of Investing by William Bernstein.

At least he isn't trying to sell you anything besides the book.

I'll see your Malkiel and raise you a Bernstein:

The conclusion remains the same, however. Oh, how terribly dull it all is when compared to a nice game of craps.

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