I need some advice with my 2 questions below. I'm 22 years old and have some extra money I want to invest. I'm looking into 1 or 2 long term (40+ years) mutual funds only from Vanguard or T. Rowe. 1.) Which funds should I consider?

Note: I already have maxed out my Vanguard Roth IRA (Target 2050) and have some money in the following T. Rowe funds: Capital Appreciation, New Era, and Equity Income. 2.) Should I close any of these 3 funds and put the money somewhere more aggressive (e.g. Vanguard's Global Equity, T. Rowe's Emerging Mkts, etc ?)

Thanks for your help.

I would suggest investing in the same funds that your Target 2050 fund invests in. To pass through foreign taxes on your 1040 forms, you need to buy the foreign funds directly rather than through the Target 2050 fund. Emerging Markets are very volatile. You could lose 50% in one year. I wouldn't go above 10% in Emerging Markets.

Vanguard Total Stock Market Index Fund 72.1%
2 Vanguard European Stock Index Fund 10.2%
3 Vanguard Total Bond Market Index Fund 9.8%
4 Vanguard Pacific Stock Index Fund 4.6%
5 Vanguard Emerging Markets Stock Index Fund 3.3%
Total — 100.0%

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What should i need for online investment?

You can go to any bank and fill the mutual fund form. All you need is any identity proof.
Or you can approach any agents. The agents list you can find at:
http://www.amfiindia.com/pu-showarn.asp?admin=yn

P.S:- For investments above 50K, you are required to submit photocopies of PAN card.

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If you doing research on funds then:
www.morningstar.com

If you investing in funds then it's good to open an account with large fund family such as:
www.fidelity.com
www.vanguard.com
www.troweprice.com

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There may have been more than one occasion when you might have had to borrow money from a friend: at the coffee shop, in the office, or even for the cab service. When you run out of money, borrowing is usually your only way out. Juxtaposing the same with big corporations and the federal government, one would find it is not that easy for them. Not only have they to repay the money owed, but to top that amount with interest. That is why companies are made to sign a bond by law, promising the repayment of the money owed. It is a formal kind of security to ensure due payment.

However, certain criteria ought to be considered before investing in a bond. Let us take a short tour through how investing in a bond could benefit you.

Before Investing

The working of a bond primarily depends on whether you need to invest money for a long or short term. Besides, it also depends on your tax status, the period and investment goals. There are some basic strategies on hand, which should be considered before making any investments. For instance, putting all your assets and risks in one single asset class would not be a good idea. It is better to diversify the risks by creating a portfolio of several bonds within the bond. By choosing different issuer’s bonds, you could protect yourself from the possibility that one of the issuer’s may not be able to pay back the amount owed.

After Investing

After investing, a par value, or the amount of money the investor receives after maturity of the bond, is calculated. This means the amount (principal) owed should be returned to the investor. The coupon rate is the amount received by the bondholder as the percentage of the par value. Lastly, a maturity date is arrived at wherein the bond issuer needs to return the principal amount to the lender.

To arrive at how much a bond would yield, one could divide the amount of interest paid over the course of a year by the current price of the bond. Prices of bonds fluctuate; hence, the current price is always taken into consideration. However, if you decide to sell before the maturity date, it is advisable to do it at the current rate of the market.

Types of bonds

There are different types of bonds available. For example, government, corporate, agency, mortgage-backed securities, municipal, etc. In addition, different maturity level bonds are also available; these help in managing the interest rate risk.

The treasury bonds available from the US government have maturity dates ranging from 3 to 5 months to thirty years.

Corporate bonds, on the other hand, which are sold through public security markets, are a little risky and have high interest rates.

Local and state government bonds have higher interest rates, as unlike the federal government, there are more chances of them going bankrupt.

Foreign bonds are difficult to buy, and is mostly done as a part of a mutual fund. However, investing in them can turn out to be risky.

To conclude, even though certain bonds may be risky, or offer a lower rate of interest, buying bonds are a safe option, as they are sound investments. Securing a number of bonds gives the owner a good credit rating and helps to prove his or her financial stability.

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